CIMB 2QFY10 Results - Bank Danamon - Here comes the growth

Maintain Outperform on Danamon. 1H10 results met consensus and our expectations, with net and core profits forming 48% and 49% of our FY10 forecasts, respectively. 1H10 EPS grew 48% yoy, with the resurging growth boosting its loans by 10.2% qoq and 12.3% year to June, making its FY10 loan-growth target of 20% easy to beat. With its NIM sustaining at double digits and growth renewing, we believe Danamon deserves better valuations. Given its lagged share performance in 1H10, a faster re-rating than peers could be expected in 2H10, in our view. We maintain our earnings forecasts and target price of Rp7,250 (DDM-based, discount rate 15.8%), with catalysts expected from its continuous growth momentum