Nomura raises target on DBS to $17.30

Stock Name: DBS
Company Name: DBS GROUP HOLDINGS LTD

Research House: Nomura

Price Call: BUY

Target Price: 17.30

Nomura increased its target price on DBS Group Holdings, Southeast Asia’s largest lender, to $17.30 from $15.80 after raising its earnings forecast for fiscal years 2012 to 2014 by 4-5%.

DBS shares closed 0.6% higher at $14.33.

Nomura said DBS’s net interest income growth in fiscal year 2012 is expected to remain strong as loan growth had upside potential on sustained regional credit demand and an increasingly diversified liquidity base.

Net interest margins also had positive traction due to the stabilising Singapore dollar rates and rising US dollar yields, Nomura said, adding that the bank’s franchise restructuring initiatives launched in 2010 were maturing well.