Kuala Lumpur: Maybank Investment Bank Bhd (Maybank IB) has maintained its “buy” call on CIMB Group Holdings Bhd with a target price (TP) of RM6.20, after the group’s 92.5 per cent-owned PT CIMB Niaga Tbk (CIMB Niaga) posted solid financial results for the third quarter of 2022 (Q3 2022).
CIMB Niaga posted a net profit of IDR1.31 trillion (100 rupiah = RM3.02) during the quarter, marking a 22 per cent increase year-on-year (y-o-y) and a 10 per cent increase quarter-on-quarter (q-o-q).
“This took CIMB Niaga’s first nine months of 2022 (9M22) net profit to IDR3.84 trillion (+18 per cent y-o-y) which is within our expectations at 74 per cent of the full year forecast,” said Maybank IB in a note Thursday.
As such, the investment bank is maintaining its forecasts for CIMB Niaga, as well as for CIMB Group.
“General trends are positive with faster loan growth, q-o-q improvements in net interest margin, stable overheads and lower credit costs.
“As such, we expect CIMB Niaga to contribute 28 per cent of CIMB Group’s earnings in financial year 2022,” it said.
Meanwhile, Public Investment Bank Bhd said it continued to like CIMB Group’s longer-term prospects, underpinned by its F23+ initiatives, hence it has maintained its ‘outperform’ call on the group, with an unchanged TP of RM6.00.
However, it noted that CIMB Niaga reported slightly weaker results on a sequential basis due to weaker non-interest income contributions.
“Nonetheless, the bank remained well-placed to weather growing economic uncertainties with continued improvements in its efficiency and productivity, improving traction in its portfolio mix optimisation, and improving asset quality combining to deliver sustainable profit growth.
“The management also continues to maintain some level of caution amid rising macroeconomic
headwinds, though optimism remains as Indonesia continues to make strides in its post-Covid recovery,” it added in its research note.
