Thursday, December 20, 2012
Osim: Macquarie downgrades to Neutral with TP $1.82. Says it is time to take a pause and reflect; believes that at current valuations, expectations of ~15% earnings growth in the next 2 years are priced in. Says multiples could re-rate further only if OSIM surprises with higher growth in 2013 or the Chinese consumer plays re-rate strongly next year. Advises stock holders to keep a close watch on 1) quarterly results – to see if OSIM is able to maintain high margins in the core business, 2) Richlife & TWG performance – as they will be the key growth drivers in the next 24 months, 3) any new acquisition announcements – for they could be negative for the stock price.