PETALING JAYA: Used motor vehicle financier ELK-Desa Resources Bhd ’s earnings outlook for the second half of financial year 2019 (H2FY19) looks to be resilient, backed by the group’s vertical expansion focus in the used-car hire purchase markets while maintaining domestic dealer partnerships in its furniture business.

According to Affin Hwang Capital, ELK-Desa is viewed as a safe haven in volatile markets given a resilient earnings outlook against a backdrop of moderating global growth.

“The group’s dividend yields remain attractive at 5.7% to 8.9%, at a 60% payout ratio. “A potential expansion of leverage will drive potential upside in earnings per share (EPS) and minimise dilution effects from the last two rights issues,” said Affin Hwang Capital.

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