Berjaya Food's exit from its loss-making Berjaya Paris Baguette joint venture is likely positive for its turnaround, removing a long-running drag on earnings, CIMB Securities analyst Walter Aw Lik Hsin says in a note. The near-term earnings impact is expected to be limited because the investment had already been fully impaired and its carrying value was close to zero, he reckons. The disposal allows management to focus on its Starbucks Malaysia business, which remains the company's main earnings driver, he adds. CIMB maintains a hold rating on Berjaya Food and keeps its target price at 0.21 ringgit, as the worst is likely over but the current valuation appears fair. Shares are 2.6% lower at 0.19 ringgit. (yingxian.wong@wsj.com)
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Berjaya Food's Paris Baguette Exit Likely to Support Turnaround — Market Talk
Berjaya Food's exit from its loss-making Berjaya Paris Baguette joint venture is likely positive for its turnaround, removing a long-running drag on earnings, CIMB Securities analyst Walter Aw Lik Hsin says in a note. The near-term earnings impact is expected to be limited because the investment ha…