Public Investment Bank
24th June, 2016


NTPM: Improvements in FY16 (NTPM MK, Neutral, TP: RM0.88)

NTPM recorded 4QFY16 revenue of RM144.7m (+7.3% YoY), while full-year FY16 revenue was higher by 9.9% YoY to RM601.7m, accounting for 98% of our forecasts. 4QFY16 net profit was lower by 23.7% YoY to RM10.0m, though FY16 net profit stood higher at RM57.7m (+35.2% YoY). The Group saw overall improvement in margins compared to FY15 due to better product mix and continuous cost-saving initiatives to improve operational efficiency. In the medium term, contributions from NTPM’s expansion into Vietnam is expected to be more visible, as we expect it to breakeven by FY18. We keep our earnings estimates and TP of RM0.88, but upgrade our call from Underperform to Neutral as share price has fallen recently and we view that NTPM is now trading at a fair valuation of 14x to our FY17F EPS of 6.3sen. The Group declared a final dividend of 0.80sen per share, bringing total net dividend per share for FY16 to 1.60sen.