KUALA LUMPUR (Aug 29): Shares in MBM Resources Bhd (MBMR) rose 5.01% in late morning trade on Monday (Aug 29), after the company announced a 16 sen dividend — comprising a first interim dividend of six sen and a special dividend of 10 sen — over three times the five sen payout it announced for the corresponding quarter last year.

This followed a more-than-fourfold increase in the company's net profit for the second quarter ended June 30, 2022 (2QFY22).

At 10.45am, the stock had pared some of it gains and was up 4.72% or 16 sen at RM3.55. The counter earlier rose to a high of RM3.59.

The dividend is to be paid on Sept 30, the company's filing with Bursa Malaysia last Thursday showed.

Kenanga Research maintained its “outperform” rating of MBMR at RM3.29, with an unchanged target price (TP) of RM4.10, and said MBMR’s first half of FY22 results met expectations.

In a note on Monday, the research house said MBMR chalked up strong sales as the economy reopened, and margins due to high-margin new models and better pricing power for its auto parts amid supply constraints in the industry.

“Associate Perusahaan Otomobil Kedua Sdn Bhd (Perodua) also turned in excellent results, thanks to strong car sales.

“We maintain 'outperform' with a TP of RM4.10. The stock offers a dividend yield of more than 6%,” it said.

Read also:
MBM Resources declares special dividend after 2Q profit jumps over fourfold