KUALA LUMPUR: MMC Corp Bhd’s results were dragged down again by provisions at associates Zelan and Kapar amounting to some RM140 million for the first half ended June 30, 2010, says OSK Research.

“While core operations improved to sustain its operating profits, continued provisions at the associate level leads us to pare down our net earnings forecast by between 6% and 6.6%,” it said on Wednesday, Aug 25.

OSK Research said while its sum of parts (SOP) fair value is largely unchanged and gives minimal upside, it is still maintaining its Trading Buy call on the stock given the anticipated news flow on the Kuala Lumpur mass rapid transit as well as speculation on its potential listing of Johor Port, Gas Malaysia and Malakoff.

“Our SOP fair value is pared down slightly from RM2.61 to RM2.59 given the recent retracement in Zelan’s share price,” it said.