Reuters: Hot Stocks: STOCKS NEWS INDONESIA-CIMB cuts Mitra Adiperkasa target price

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STOCKS NEWS INDONESIA-CIMB cuts Mitra Adiperkasa target price Sep 19th 2012, 08:15 Wed Sep 19, 2012 4:15am EDT CIMB Equity Research slashed its target price on shares of Indonesian retailer PT Mitra Adiperkasa Tbk to 7,500 rupiah from 8,300, citing expectations of lower margins and a subdued second-half. "1H12 earnings were 39 percent of our FY12 estimate and 36 percent of consensus," Erwan Teguh, Head of Research at Indonesia-based CIMB Equity, wrote in a note on Wednesday. "Restatement of 1H11's earnings, down by 17 percent, was not a good sign, nor was the guidance for a 1% pt cut in margin. We cut our earnings and target price, now pegged at 23x P/E, in line with regional peers," Teguh said. The broker said the company's first-half results showed lower gross margin, while the guidance for a further cut suggested some structural issue. The earnings forecast cut of up to 7 percent is based on lower gross margin, partially offset by lower interest costs in 2013, he added. The research house kept its 'neutral' rating on Mitra Adiperkasa, but de-rating cannot be ruled out if second-half earnings turn to 'disappoint', Teguh said. Shares of the company were down 2.27 percent at 6,450 rupiah, while the broader index was up 0.50 percent. 1443 (0743 GMT) (Reporting by Andjarsari Paramaditha) Link this Share this Digg this Email Reprints

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