Maybank IB Remains Positive On Axiata's Earnings Outlook, Reiterates 'buy' Call

KUALA LUMPUR, July 11 (Bernama) -- Maybank Investment Bank Bhd (Maybank IB) maintained a positive earnings forecast on Axiata Group Bhd and reiterated a ‘Buy’ call on Axiata with an unchanged target price of RM2.90 per share.

In a note today, the investment bank said there would be a significant improvement in Axiata’s gearing following the potential divestment of its entire stake in Edotco.

“The hypothetical divestment of Axiata’s entire stake in Edotco would deconsolidate Edotco’s borrowings while bringing in potential cash proceeds.

“We simulate the divestment of Edotco at seven to 12 times enterprise value to earnings before interest, taxes, depreciation, and amortisation (EV/EBITDA), which implies potential proceeds of a cumulative RM3.2 billion to RM8.3 billion,” it said.

At 10.45 am, the counter rose four sen to RM2.39 with 121,200 shares traded.

-- BERNAMA