OCBC Investment Research raised its target price for massage chair maker Osim International to $1.82 from $1.61 and kept its ‘buy’ rating, citing strong growth and better-than-expected margins.
By 10:34 a.m., shares of Osim were 3.4% higher at $1.225, and have gained about 6% so far this year, outperforming the FT ST Consumer Goods Index’s 17% loss.
Osim’s second quarter net profit rose 20.1% to $22.5 million, higher than OCBC’s estimates, due to better-than-expected margins backed by favourable product mix and better productivity, the brokerage said.
It raised its 2012 and 2013 net profit estimates by 3.6% and 2.9% respectively.
“While we acknowledge that concerns over the slowing Chinese economy remain entrenched, Osim has executed well on driving its productivity gains and expanding its margins to mitigate this," OCBC said in a report.
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