Highlights of the day
§ KPJ Healthcare (Company Update): Growth trajectory reflected in its financials (Maintain HOLD, TP: RM4.96) [download report]
We are positive on KPJ’s long term prospects, asset light business model and defensive earnings. However, the stock growth trajectory is already reflected in its financials. Based on our forecast, the stock is trading at 23x FY12 and 20x FY13 FD EPS which appears rich compared to an average net profit growth of 12% pa over the next two years. Maintain HOLD with TP RM4.96 based on 22x FY12 FD EPS, in line with peers average.
§ Money and Banking (Money and Banking): February 2012: Drastic YTD contraction in business loans [download report]
February total loans grew slower at 11.9% y-o-y compared to 12.1% y-o-y in January despite the fact that the Lunar New Year fell in January this year instead of February as it did last year. Moving seasonality may have masked the underlying trend in loans growth. Year-to-date loans growth is 0.2% y-o-y while it grew 1.7% y-o-y last year. This may hint some kind of slowdown in overall loans growth. Meanwhile, systemwide spread between average lending rate and cost of funds fell by approximately 7bps to 240bps. The broad money supply grew faster at 15.9% y-o-y than the previous month when it grew by 14.7% y-o-y. In contrast, the monetary base grew slower at 9.8% y-o-y versus 10.5% y-o-y in January 2012.
Other reports
§ Sapura Kencana Petroleum (Results Review): 31 Jan quarter results: In line (Maintain HOLD, TP: RM2.32) [download report]
Other Malaysian news
§ CIMB: To partner in APH project
§ UMW: Petronas extends contract with UMW
§ MBSB: To disburse RM500m loans via ‘MBSB my first home scheme’
§ Takaful Malaysia: Beefs up Indonesian operation
§ VSI: Plans to invest US$10m in Indonesia facility
§ SEG: Navis Capital buys 37.5% stake in SEGi
§ Silver Bird: Suspended MD, wife reduce their stakes
§ Xian Leng: RM90m accounting issue in Xian Leng
§ Extol: Bidding for RM100m worth of jobs
§ Banking: Banking system well-capitalized, RWCR at 14.8%
Global news
§ US: Treasuries drop on outlook in worst quarter since 2010
§ US: Employment Probably Kept Growing in March: U.S. Economy Preview
§ UK: BOE to keep bond-buying plan on hold amid split
§ Euro: Leaders seek global help after firewall boosted
§ Japan: Must overhaul taxes to avoid bond rout, bank lobby says
§ China: Manufacturing gain masks exporters’ woes as loosening seen
§ Global: India and China skirt Iran sanctions with junk for oil
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