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Tuesday, June 7, 2011

AMEDIA – In rapid transit to growth (CIMB)

Asia Media, Malaysia’a largest transit TV operator, offers a good growth story in a small but fast-growing media segment. Another key attraction is the group’s exposure to the public transportation upgrade in the Klang Valley which will allow it to expand its services to the LRT and MRT systems. Tagging a 40% discount to our 14.5x target P/E for the larger media companies under our coverage, we get a CY12 P/E of 8.7x. Based on an estimated CY12 EPS of 6 sen, the stock could be worth 53 sen, which suggests attractive upside of 88%. The stock is trading at cheap CY12-13 P/Es of 4-5x and could be catalysed by strong quarterly numbers or success in securing the licence to operate on the LRT. Asia Media provides investors with an alternative exposure to growing media segments other than FTA TV and newspaper.

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