to "buy" on the back of its recovery prospects as management undertakes a proactive approach towards navigating the Covid-19 situation."The new management has unveiled its 2025 roadmap, with a view of shaping the group into a tech-centric and healthcare-focused solutions provider.
"This is centred upon its use of technology to drive operational efficiencies (c.MYR100m opex savings over five years), enhancing its value proposition via digitalisation, expansion of solutions offerings (eg COVID-19 management), and a business footprint into other high-growth regions and market areas," said RHB.
While there were no dividend payments in FY20 in an attempt to preserve cash, UEM Edgenta has reiterated its commitment to resume its dividend policy of 50% to 80% of PATAMI going forward.
The research house raised its target price on the stock to RM2.05 after rolling forward its sum-of-parts valuation base to FY22 with an implied price-earnings of 11x, albeit trimming FY21 earnings estimate by 7%.
"Risk-reward is attractive, given improved visibility on its earnings recovery, with COVID-19 vaccinations underway, while the resumption of dividends is set to offer 5-8% yields," it said.