DRB-Hicom down 3.30% this morning

October 8, 2018 | By | Reply More

Grab latest promotion at LAZADA now!

PETALING JAYA: DRB Hicom Bhd’s shares fell as much as 3.30% to RM2.07, as analysts flagged a possible drag on its balance sheet from its potential participation in the third national car project.

At 11.30am, the stock was trading at RM2.07 with RM2.34million shares done.

While DRB-Hicom’s participation in the new national car development is viewed to be in line with its strategic automotive plan, analysts have concerns on the financing and viability of the project that may drag DRB-Hicom in the short term.

HLIB Research is neutral on the revelation of DRB-Hicom’s 96.9%-owned Composites Technology Research Malaysia Sdn Bhd (CTRM) as one of the potential partners for Malaysia’s new national semi-autonomous car project, despite details remaining sketchy.

“We have concerns on the project’s financing and viability (at least in the short term), as DRB is still in the midst of its restructuring exercise for a turnaround after registering losses for the past three financial years (dragged by Proton), while Proton may need equity injection in the near term to finance its growth plan,” the research house said in a report.

“The overall details of the new national car project remain sketchy and the mentioned timeline is relatively aggressive, in our view. Given the short timeline, the prototype of the new semi-autonomous car may be based on existing developed ideal/vision prototype. We have doubts on Malaysia’s existing capability and capacity for the project. It was not mentioned if the project would rope-in foreign partners/supports,” HLIB Research said.

FREE RM12.70 credit upon sign up to discover and book amazing travel experiences with Klook.

Category: News

About the Author ()

Leave a Reply