Alliance Financial Group (AFG MK, BUY, FV: RM4.25, Last close: RM3.50). The group’s 1HFY12 results were largely in line with consensus and our full-year estimates. Net profit expanded by 17.6% due to better Islamic banking income, stronger non-interest income and lower impairment charges. The laggard stock’s immediate term catalysts are stronger NIMs arising from any potential OPR hike and M&A excitement. Maintain BUY, with a revised FV of RM4.25 as we roll forward our valuation to FY13 PBV of 1.7x (13.5% ROE, 9.5% COE and 4% growth rate).
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