Morning Call 17 JULY 2012
FLOWS:
BUYS: BStead, PBB
SELLS: AMBank, IJM, Gamuda
Technical Stock Alert:
Bstead(RM5.55) - after consolidating for 3 weeks between
a range of 5.50 to 5.30, Bstead broke out last week on huge volume and
confirmed a reverse head and shoulder pattern with a minimum upside target of
6.10 and a higher mid-term target of 6.35. The stock trades at attractive
valuations - forward PER 10.4x, p/bk 1.25x and a 6.2% gross dividend yield, and
its main divisions of plantation and pharmaceuticals are in sectors which are
current market favourites and are also firing on all cylinders. The property
division has catalyst projects eg the Jalan Cochrane project and exciting
newsflow of potential JV with LTAT on the Batu Cantonment army camp at Jalan
Ipoh. The problematic heavy industries division has also seen its worst days
and will be contributing significantly with the award of the lucrative RM9bn
naval patrol vessels contract. Buy
(PT)
TChong (RM4.60) - volume has been picking up of late as
this underperforming auto stk plays catch up as anticipation builds for better
results on new launch of Nissan Almera in the Class B segment which will be
very competitively priced against its peers eg Vios, City. Technically, MACD has turned up and widening creating a
+ve divergence.
Table below for easier comparison:
Ytd performance (%) yield (%)
PER (x)
20
MBMR +84 1
11
DRB +30 2
9
TChong +12 2
17
Co is said to be optimistic of recovering mkt share to
5.6% v 5.3% earlier as sales of top seller Nissan Grand Livina MPV still a/c
for 40% of its mkt share. Recovery from supply chain constraints and new model
launches in 2H to provide much needed impetus for stk-BUY
(LJN)
