OSK Keeps Notion Vtec At Neutral; Target MYR2.12

OSK Research maintains Notion Vtec (0083.KU) at Neutral with an unchanged price target of MYR2.12. The house says the company's 1H FY11 core net profit of MYR19.5 million came within its expectation, achieving 47.4% of its full year forecast, but it fell short of market consensus. "While we like its increasing focus in the camera segment, we believe it is too early to turn bullish on the stock as the appreciation of the ringgit against dollar and rising aluminium prices could spell earnings uncertainty in 2H FY11," the house adds. It also says, though potential setback in the HDD industry could dampen sentiment, "we believe the new income stream from closer tie-ups with Nikon would help to mitigate the downside risk to earnings." The stock is up 1.0% at MYR2.09.