Following our recent discussion with management, we gather that the YTDFY09 earnings trend is still indicative of strong earnings growth momentum. We believe that:
1) a strong investment banking and bond origination deal pipeline,
2) further traction in CIMB Niaga’s earnings growth, and
3) more subdued loan loss provisioning on the back of still improving asset quality will underpin consensuswide earnings upgrades as we edge closer to the release of the group’s 3Q09 results
in November.
Our current FY09 earnings estimates are 9.2% above consensus. Maintain BUY with a higher TP of RM13.00 (2.2x FY10 PBV and 14.9x FY10 PER), implying a realistic 14.4x FY10 PER, which is still below its historical 15x average PER.
"CIMB is the no.1 bank in Malaysia because it provides you the special situation investing concept. I believe it will hit RM13.00 within 12 months. All "friend"s really good support for CIMB share, keep buying daily. "Hot" money is pump into CIMB to stimulate the share price" Mr. Tun
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