KUALA LUMPUR (March 7): TA Securities Sdn Bhd has assigned a target price-earnings (PE) of 23 times financial year 2025 (FY2025) forecast earnings per share (EPS) for ACE Market-bound Alpha IVF Group Bhd and derived a fair value of 28 sen.
In a note on Thursday, the research house said at the initial public offering (IPO) price of 32 sen, Alpha IVF is priced at a trailing PE of 29.2 times FY2023 EPS.
TA Securities, which does not have a rating on the stock, said its valuations have taken into consideration the group’s experienced management team, arguably that most wide-ranging fertility-related treatment services in the region and high standards in in-vitro fertilisation.
“On top of that, we have also considered Alpha IVF’s rich margins and medium-to-long term earnings growth prospects, which are backed by growing medical tourism and declining total fertility rate.
“Going forward, we forecast Alpha IVF’s core profit to increase to RM54.0/59.6/70.8 million in FY2024/2025/2026F driven by higher Oocyte Pick Up procedure.
“Our expectations on FY2024/2025/2026F respective sales growth of 23%/15%/20% are on the back of expansion plans and growth of the medical tourism industry,” it said.