The lower price target results from accounting for start-up costs for the group’s China hospitals, which has led CIMB’s FY17-19F core earnings per share (EPS) estimates to fall by 1.3%-26.2%.
SINGAPORE (Sept 18): CIMB Research is upgrading its call on Raffles Medical Group (RMG) to “add” from “reduce” with a lower price target of $1.21 from $1.25 previously on the belief that the stock is looking attractive to gain exposure to the growing China healthcare market, as gestation woes have been largely priced in.
In a report issued on Sunday, lead analyst Ngoh Yi Sin notes that the group’s share price has corrected about 27% in the year to date (YTD), which makes the stock a more attractive buy to investors in terms of risk-reward and also presents an opportunity for entry in the case of any further near-term share price weakness.
