Written by RHB Research
Tuesday, 09 March 2010 09:17
KUALA LUMPUR: RHB Research is maintaining its Outperform on PROTON HOLDINGS BHD [] at the share price of RM4.42 with a fair value of RM5.48.
It said on Tuesday, March 9 Proton Holdings will develop a comprehensive local vendor structure to support its global car programme after unveiling its concept car, EMAS at the International Motor Show in Geneva, Switzerland last week.
Recall that EMAS (Eco Mobility Advance Solution) has three variants i.e. the five-door four-seater “EMAS”, three-door 3+1 plus seater “EMAS3” and three-door five-seater hatchback “EMAS Country.
RHB Research said the concept car which is the result of a joint collaboration between Proton, its subsidiary Lotus and Italian design house Italdesign Guigiaro, is powered by a serial hybrid plug-in drive system with an engine that is able to run on petrol, ethanol, methanol or natural gas.
“This is a giant leap for Proton as it enters into the global market after being focused on the local market for the past 25 years. However, EMAS is still a concept car and roll-out of the car is only scheduled in 2012,” it said.
The key risks for this venture are: 1) Lack of economies of scale and expertise, 2) Lack of global distribution networking, and 3) Competition from more established players, i.e. Toyota and Honda.
“We are keeping our numbers for the time being as the concept car is only scheduled to go into production two years from now. Hence, we are maintaining our Outperform rating on the stock with a fair value of RM5.48 based on stripped down book value,” it said.
