Kenanga

KGB - Orderbook Surged on New Jobs

KGB’s post-results’ briefing received positive response from ~80 participants. KGB’s order-book reached a new high of RM370m as SMIC’s expansion hit full speed, with no signs of slowing. Job replenishment remains healthy. The group expects order-book level to remain elevated even after factoring a stronger 4Q ahead. In addition, KGB has been in touch with Pfizer to understand the use of dry ice to store vaccines. We believe the scarcity of deep freezer, especially in rural areas, makes dry ice a timelier and more efficient option for vaccine distribution. Positive prospects are juxtaposed with an attractive Fwd. PER of 18.7x vs peers’ average of 30-58x. Our OUTPERFORM call and TP of RM2.30 reaffirmed.

Share price also up up!!

Yes, agree with cschee68.. Once accumulation phase completed, shoot to the sky!

Tech stocks rally not gonna stop anytime soon. Hoot!

Tech stocks rally not gonna stop anytime soon. Hoot!

Buy buy buy! UOB upgraded TP 1.10!!

Optimax Holdings (OPTIMAX MK/BUY/RM0.81/Target Price: RM1.10)
1H20: Temporary Glitches By MCO; Good Growth Trajectory Ahead

*What’s New*
• *ACC expansion drives organic growth.* Optimax’s expansion plan includes upgrading both Klang and Seremban branches to Ambulatory Care Centre (ACC) in order to carry out cataract and refractive surgical procedures. Management sees the potential annual revenue generation from both ACCs to be closed to RM10m-12m from 2021F onwards (2019: RM1.3m). We gathered that Optimax’s organic growth comes from the growing number of ACC.

• *Earnings recovery in 2H20*. While 1H20 earnings dropped 77% yoy amid COVID-19 impact, management sees surgeries picked up encouragingly with surgeries conducted for the month of June and July have outpaced the average monthly level seen in 2019. Taking cues from management inputs and records in the past, we believe the healthy underlying demand for ophthalmologist services could pave the way for an earnings recovery in 2H20.

• *Good growth prospect with a 24% earnings CAGR for 2019-22F*. This will be underpinned by: a) additional revenue stream from the Seremban and Klang ACC, b) an average 23% revenue growth from both cataract and laser operations, and c) established market presence. Optimax is the key beneficiary of the growing trend of aging and myopic populations.

• *Maintained BUY with a higher target price of RM1.10* in tandem with earnings upgrade (raised 18% and 14% for 2021F-22F earnings). We also ascribed a higher 2021F PE from 20x to 25x. This is based on regional 2016-19 average PEG of 1.5x, and a 30% discount from the implied PE of 36x. Since our initiation with BUY, share price soared up 270% from its IPO price and 13% from our previous TP. That said, we believe the market might not have sufficiently priced in for its scarcity premium given its good value proposition.

Please see the attached file link:
https://research.uobkayhian.com/content_download.jsp?id=58627&h=3beeb3d3d3c61910b3b8822f439fc4d4

Congrats all!!