Highlights of the day
§ IJM Corp (Quick Bits): IJM ups the ante in West Coast Expressway (Maintain BUY; TP: RM7.02) [download report]
In an announcement to Bursa Malaysia yesterday, IJM Corp bought over Prominent Xtreme Sdn Bhd’s 20% stake in West Coast Expressway (WCE) Sdn Bhd. Including IJM’s indirect 18% stake in WCE Sdn Bhd via its 22.72% share in KEuro, the 80% controlling stakeholder of WCE, this share transaction results in IJM having an effective 38% share in WCE. We view that IJM will gradually increase its stake in WCE over the course of the project to gain more recurring income from the WCE toll concession in the future. Maintain BUY with TP unchanged at RM7.02 based on sum-of-parts.
§ Telekom Malaysia (Company Update): Riding on the fixed line growth (Maintain HOLD; TP: RM4.78) [download report]
We are positive over TM’s HSBB Unifi growth momentum that has beefed up FY11 internet revenue which we believe would further drive up future growth. However, our HSBB Unifi net adds assumption is on the conservative side to account for competitions going forward. Consequently, after revising earnings by 1%-24% in FY12-FY14, we upgrade our TP from RM3.70 to RM4.78 based on the Gordon Growth model imputing 4.5% long term growth and 30 sen per share of capital distribution in FY12. However, given the rich valuation, we maintain HOLD on TM
Other reports
Other Malaysian news
§ Maybank: Islamic unit embarks on regional push
§ Axiata: Etisalat eyes US$700m from sale of XL Axiata stake
§ TNB: Sees solution to subsidy issue soon
§ MMC Corp: More time needed for Gas Malaysia listing
§ MAS: No latest development on AirAsia-Mas share swap deal
§ Naim Indah: To participate in Shell LPG business buy
§ Ramunia: Wins RM23.6m substructure job
§ Silver Bird: Down but not out
§ TSM Global: Will consider other offers for its business
§ Aviation: IATA advises against charges hike
§ Oil & Gas: Technip bags Petronas' Rapid design deal
Global news
§ US: Fed says 15 of 19 banks have adequate capital in stress
§ US: Fed says labor market improves, leaves policy unchanged
§ US: Retail sales climb by most in five months
§ US: Job openings were little changed from highest since 2008
§ Europe: Weidmann says ECB looking at ways to exit from crisis tools
§ Europe: German investor confidence surges as debt crisis eases
§ Japan: BOJ expands loan program to fight deflation
Visit ECM Libra at https://mail.ecmlibra.com/exchweb/bin/redir.asp?URL=https://www.ecmlibra.com/ecmlsmy
Our on-line trading portal at https://mail.ecmlibra.com/exchweb/bin/redir.asp?URL=http://www.ecmmoney.com/
