It said today it expects the Bezza to give a boost to UMW’s earnings while it maintains a price-to-earnings of nine times for the latter’s auto segment.
The research house also has a fair value of RM2.30 a share for MBM Resources, which is at 9.5 times PE FY16 earnings per share. It had Hold calls for UMW and MBM.
Perodua will launch its Bezza on July 21, which is the car maker’s first B-segment sedan for young families and will be primarily marketed to existing Axia and Myvi users who are looking to upgrade.
The Bezza comes in five variants: 1.0L standard G (manual and auto), 1.3L Premium X (manual and auto) and 1.3L advance (auto only). While the final prices have not been revealed, it will be priced between the Axia and Myvi.
It has a high degree of local content. Recall that Perodua imports 10% of its raw materials, with exposure to the Yen for the Myvi and Alza, and USD for the Axia. The company's costs rose 25% last year on forex, while profit margin dropped to 4.7% from 5.8%.
“The price of the Bezza should range between RM33,000 and RM50,000 (translating to an average price of RM42,000). This would place the Bezza squarely in between the Axia (price range: RM24,000-RM41,000) and the Myvi (price range: RM41,000-RM58,000.
“At this price range, it would fare well given the price consciousness of customers in the current environment, and the increasing age of the current Perodua line-up (the Axia debuted in 2014, Alza in 2009, the Myvi in 2005),” it said.
AmInvestment said the Bezza would be the cheapest in its segment and compete with the Nissan Almera (RM69,000-RM82,000), Mitsubishi Attrage (RM70,000-RM75,000), Honda City (RM73,000-RM89,000) and Toyota Vios (RM78,000-RM98,000).
Against Proton, the Bezza would contend with the Saga (RM34,000-RM38,000) and Persona (RM46,000-RM49,000). The other Proton models are priced higher:- the Preve (RM59,000-RM74,000), Inspira (RM78,000-RM92,000) and the Perdana (RM113,000-RM138,000).
Perodua aims for volume and will rely on price to succeed with the Bezza. The Axia was priced to be the cheapest among A-segment hatchbacks and sales rose from 30,000 in 2014 (15.1% of Perodua TIV) to 99,000 in 2015 (46.6% of Perodua TIV).
Average monthly sales of the Axia, however, moderated from 9,800/month in 2014 to 8,800/month in 2015.
In terms of volume, Perodua will rely on the Bezza to reach its target of 212,000 units this year. This is because the 5MFY16 sales had underperformed, meeting 36% of the FY16 target, while annualised sales would only touch 88%.
“We believe Perodua had rushed for a mid-year launch, much sooner than most had anticipated, to get a bigger volume boost for the full year.
“We have raised the potential volume contribution from the Bezza to 12,000 (3,000 units/month for Sept-Dec) from 8,000 previously (2,500 units/month for Oct-Dec), and retain our assumption of 40,000 (3,000 units/month) for FY17. Our volume assumptions for Perodua are at 212,000 for FY16 (-1% on-year) and 219,000 for FY17 (+4% on-year),” said the research house.
