Viz Branz

Viz Branz: OCBC upgrades to Buy with unchg TP of $0.74. Notes share price has corrected 5.6% following mkt disappointment over lack of an immediate GO previously. But believes fundamentals remain unchanged in the medium term. Reiterates assertion that Lam Soon (~19.8% ownership) will make an offer for the remaining shares. 1QFYJun13 results were in line with OCBC’s expectations. Despite seasonal weakness with the 1.5% yoy decline in revenue to $41.1m, Viz Branz still managed to post a 19.4% yoy increase in operating profit to $6.1m, following favorable raw mat’l costs during the qtr and effective cost control measures. As a result, net profit grew 17.4% yoy to $4.5m. Gross and operating margins increased 5.7ppt and 2.7 ppt yoy to 36.7% and 15.0%. The stock is flat at $0.67.