Pantech - Making Steady Progress (OSK)

Pantech’s 3Q results came in stronger-than-expected q-o-q with a revenue growth of 12% and net profit growth of 42.9%. Although there are some losses arising from the manufacturing division’s stainless steel pipe-making unit, this is not a big concern for us as it naturally needs to undergo a steep learning curve for managing this new business arm. Nevertheless, we still believe Pantech will progress well with more expansion plans being rolled out.

We maintain our Trading BUY call with a new FV of RM0.595 derived from 5x FY13 EPS.