kimeng: 3 mar NSTP ( hold)

> Penning strong numbers; write-backs of impairment continued
> NSTP posted EPS of 15.6sen (+38% Y/Y) in FY07, meeting our expectation.
> Excluding net exceptional gains of RM21.7m and RM18.4m from FY07 and
> FY06 and the respective deferred tax impact, core operation actually
> posted EPS of 13sen (+62% Y/Y) in FY07, thanks to a 7.5% rise in
> turnover which benefited from a 10-11% increase in advertising revenues.
> And, thanks to a 25% decline in interest expense due to a lower debt
> level, pretax profit (before exceptional gains) grew a stronger 83% Y/Y,
> even though contribution from associate Malaysian Newsprint Industries
> (MNI) softened 14% to RM5m. NSTP has declared a first and final gross
> dividend of 8 sen per share, slightly lower than last year's dividend
> comprising normal gross dividend of 5sen and special gross dividend of
> 5sen.
>
> At steep discount to book NTA, otherwise an unexciting story
> We have kept NSTP as a HOLD, notwithstanding the stock's price/book
> valuation of only 0.4x and FY08 PER of 14x. The lack of exciting stories
> in a highly volatile market in which investors seek high-beta returns,
> will probably result in the stock being range-bound. In addition, the
> dividend yield is unexciting.