Among the positives, Affin HWang Research said SIme Darby INdustrial, the third largest Caterpillar dealer globally, is set to revound in FY18019E on firmer commodity prices and mega-infrastructure projects and townships in the pipeline.
It said Sime’s motor division should also see higher revenue growth in FY19-20E, sdriven by BMW’s product upcycle and attractive model line-ups from other car marques.
Further, it added that robust long-term healthcare demand should continue to benefit Ramsy Sime Darby Healthcare, and expected its ongoing cost rationalisation initiatives to foster earnings growth.
“Potential upward re-rating catalysts include possible disposal of its logistics division or its Malaysian Vision Valley (MVV) land.
“Key downside risks are competition in respective divisions, susceptibility to an economic slowdown and local regulatory risks,” it said.