Share Price: RM6.76 | Target Price: RM8.40 | Rating: Buy
BUY call retained by RHBIB with a lower TP of RM8.40 (compared with RM9.25 previously) due to a more cautious global macroeconomic outlook. Earnings forecasts and TP trimmed to reflect the challenges ahead. RHBIB opines that CIMB’s operating income (rather than credit cost) poses a larger downside risk to earnings, while an uncertain earnings outlook could lead to a sharp compression in valuation multiple. CIMB share price is down 18% YTD which is around July 2024 levels, possibly pre-rerating with the aid of foreign investors. RHBIB is of the view that the forecast FY25 dividend yield of around 6% and 0.98x P/BV should provide downside support.
CIMB Research Update
Research House: RHB Investment Bank (RHBIB)
Analyst: David Chong, Nabil Thoo
FY2025 Forecast: Net Profit: RM7,995m | EPS: RM0.75 | DPS: RM0.42
FY2026 Forecast: Net Profit: RM8,431m | EPS: RM0.79 | DPS: RM0.44
(Both FY2025 and FY2026 forecast EPS reduced from 78sen and 83sen respectively, DPS reduced from 43sen and 46sen respectively compared to previous Research Report dated 3/3/25).