RHB Research maintains ‘buy’ call on DRB Hicom

RHB Research maintains ‘buy’ call on DRB Hicom

KUALA LUMPUR,. RHB Research Institute has maintained a “buy” call on the 50.1 per cent stake owner of Proton Holdings Bhd, DRB Hicom Bhd, following the national carmaker’s positive efforts to improve its image.

The research institute said it likes the atmosphere of the upgraded centres.

“Product-wise, the initial market response to the Proton X70 and its dealership network revamp indicates improving brand perception – which will be a long-term work in progress.

“We maintain our target price of RM2.92 for the company as Proton’s turnaround will be a positive re-rating catalyst for DRB-Hicom,” it said.

At 10am today, DRB shares rose by three sen to RM2.17 with 662,200 lots changing hands.

Moving forward, however, Proton is likely to reduce the number of 1S centres and replace them with 3S/4S centres by incentivising dealers to upgrade their centres.

One of the incentives is giving them the opportunity to sell Proton’s latest models, starting with the X70.

Over the long term, RHB said, this should improve overall dealership network management and translate into better customer service quality. — Bernama