Phillip Capital says there could be improved profitability from the company’s bus business due to lower oil prices.
Here’s more from Phillip Capital:
A defensive stock for uncertain times
Undervalued against closest peer
Trading at only 12X T12M EPS
Valuation. We used a blended valuation model of DCF (COE: 8.2%, terminal g: 1%) and P/E (17X FY11e PATMI) to arrive at our target price of S$2.01. CDG could potentially return 52.1% after incorporating our forecasted dividends of 6.1¢ over the next 12months. Hence, we maintain our Buy call on CDG.
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