CIMB Research has maintained its Add rating on Cuscapi Bhd at 37 sen with a lower target price of 45 sen (from 70 sen) and said Cuscapi recorded a RM2.9 million loss in 1H14, which was below house expectations as the research house believed that the company had turned around early this year.
In a note Aug 28, the research house said Cuscapi’s operations seem burdened by higher operating costs while its topline growth was slow.
“We slash our EPS forecasts and this causes our target price to drop as we maintain our target valuation basis at 21x CY15 P/E, in line with its peers.
“The stock remains an Add, with higher REV subscription numbers and the clinching of more major contracts being the potential re-rating catalysts,” it said.
In a note Aug 28, the research house said Cuscapi’s operations seem burdened by higher operating costs while its topline growth was slow.
“We slash our EPS forecasts and this causes our target price to drop as we maintain our target valuation basis at 21x CY15 P/E, in line with its peers.
“The stock remains an Add, with higher REV subscription numbers and the clinching of more major contracts being the potential re-rating catalysts,” it said.
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