SINGAPORE (Nov 10): DBS Vickers Securities is maintaining its “buy” call on Yoma Strategic Holdings with an unchanged target price of 80 cents, while remaining positive on the group’s prospects on the back of an improved operating outlook in Myanmar.

This comes after the Myanmar-focused business conglomerate posted 2Q17 earnings of $8.5 million, which was 28 times more from $0.3 million the year before.

(See also: <a href="http://www.theedgemarkets.com.sg/sg/article/yoma%E2%80%99s-2q-earnings-surge-85-mil-higher-revenue" target="_blank">Yoma’s 2Q earnings surge to $8.5 mil on higher revenue</a>)

In a Wednesday note, analysts Rachel Tan and Derek Tan say they see Yoma as a beneficiary of an improved economic outlook with the new Myanmar government.

Aside from steady growth revenue contributed from Yoma’s non-real estate business and KFC stores, the analysts also highlight that the group’s real estate business appears to be doing well based on its latest set of financial results.

“Looking ahead, the establishment of the framework of the condominium law, which promotes and facilitates foreign investment in Myanmar’s real estate market, is expected to boost transaction volumes going forward,” they continue, adding that continued supportive government policies on foreign investments in Myanmar are key to improving sentiment within the real estate space.

DBS has yet to remove earnings in its forecasts, as the research house is still awaiting the completion and approval of Yoma’s recently-proposed spinoff of its tourism businesses before doing so.

(See also: <a href="http://www.theedgemarkets.com.sg/sg/article/yoma-strategic-list-71-mil-worth-tourism-related-assets-rto-shc-capital-asia" target="_blank">Yoma Strategic to list $71 mil in tourism-related assets via RTO of SHC Capital Asia</a>)

“If delisted, we estimated close to 5% impact to forecasts. In addition, Yoma has exercised its option to sell its 12.5% stake in Myanmar Towers Company (MTC) for US$35 million. Yoma intends to hold on to its remaining 12.5% till the company achieves stability,” say the analysts.

“We believe the consistent delivery of the group’s real estate sales, coupled with the continued scaling up of its operations for its non-real estate segments, will represent upside to earnings and target price.”

As at 3:26pm, shares of Yoma are trading flat at 58 cents.

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