KUALA LUMPUR: Aeon Co (M) Bhd's net profit which rose 54.1 per cent in the first quarter of 2024 (Q1 2024) is above Affin Hwang Investment Bank Bhd and consensus' estimates.
In a research note, Affin Hwang said the results accounted for 51 per cent of its full-year forecast and 45 per cent of consensus'.
It said the improved performance was primarily due to a better-than-expected product mix in the retail segment, resulting in an overall pre-tax earnings margin of 10.1 per cent.
"As there were no exceptional items during the quarter, we think that this margin trend may be sustainable.
"Besides, the property management services segment continued to show earnings resilience with the EBIT margin improving to 36.4 per cent, thanks
to its effective rental renewals," it added.
Quarterly, Aeon Malaysia's revenue rose by 13 per cent primarily attributed to the seasonal sales
improvement.
Affin Hwang increased its earnings forecasts by 30-37 per cent in financial year 2024 (FY24)-26E to account for the
better-than-expected results.
Following the earnings upgrade, the firm upgraded its call to "Buy" for the stock with a higher target price of RM1.55.
