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ValueMax started at ‘buy’ on future earnings growth, higher interest rate environment

Michelle Zhu
Michelle Zhu9/7/2017 12:40 PM GMT+08  • 2 min read
ValueMax started at ‘buy’ on future earnings growth, higher interest rate environment
SINGAPORE (Sept 7): KGI Securities has initiated coverage on ValueMax at “buy” with a target price of 39 cents, based on a price-to-book (P/B) ratio of 1.15 times FY17F estimates and in view of robust future earnings growth as well as a lower-for-long
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SINGAPORE (Sept 7): KGI Securities has initiated coverage on ValueMax at “buy” with a target price of 39 cents, based on a price-to-book (P/B) ratio of 1.15 times FY17F estimates and in view of robust future earnings growth as well as a lower-for-longer interest rate environment.

The group operates pawnbroking and moneylending services, as well as deals in the retail and trading of pre-owned jewellery and gold.

In a Thursday report, analyst Colin Tan highlights how ValueMax’s high-margin moneylending business, which was started in 2014, has fuelled “remarkable” earnings per share (EPS) growth of 54.9% and 17.9% in FY15 and FY16, respectively, and says he expects strong growth momentum to continue in the next two financial years ahead.

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