Goodpack: CIMB downgrade to Underperform from Neutral. House note that Goodpack’s trading history shows that weak market sentiment could send its valuations down to a trough of 5x P/E, as in 2008, despite its intact fundamentals. It is now trading at 12.6x CY12 P/E. In view of overall market weakness, house lowers P/E target from 14.4x to 10.3x CY12 P/E, one SD below its 4-yr historical forward average, while maintaining our earnings forecasts.
TP accordingly falls from $1.75 to $1.30. In spite of its recent underperformance, downgrade Goodpack to Underperform on valuations, recognising valuation-compression risks.