Brokers' Take

Best World International
April 18 close: 73 cents

BEST World's Malaysia and Singapore sales appeared to have grown by at least 30 per cent y-o-y in 1Q06, with the two markets remaining the group's key revenue generators.

Malaysia experienced both product sales and agent growth. Singapore sales were previously expected to slow down, but this has not happened, thanks to the launch of a new product - the negative ioniser. Negative ioniser sales in March reached a respectable 800 units per month. Priced at $750 each, take-up for this product has surprised us a little.

The seeds of growth have been sown regionally, especially in Hong Kong and Taiwan. Thailand continues to lag behind, due to a lack of motivated leaders. Indonesia has been doing well, but is overshadowed by Malaysia.

Our target price is intact at $0.90, based on 12 times CY06 PE, a 30 per cent discount to peers. The stock's under-performance after the release of below-par results presents a buying opportunity. We believe that Best's business remains as cash-generative as ever, while the stock continues to trade at a deep discount to peers.
OUTPERFORM

- Compiled by MATTHEW PHANM

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