Potissimus Optimus: Morning Call

Monday, September 10, 2012

Stock Alert
STOCK	DATE	PRICE	BUY/SELL	TARGETPRICE
GTRONICS (7022)	10/9/2012	RM1.45	Trading BUY	RM1.60
Recent retracement of 12% from its peak of RM1.64 has provided a buying opportunity in GTRONIC that is expected to see significant growth in earnings starting from 2H2012 when its proximity sensors production lines are ramped up ahead of smartphone product launches. Growth would come from further capacity expansion and R&D into other sensors or possible turnkey operator. Expect share price support at RM1.40 level. Dividend remains attractive at 7.5% yield and FY12PE of 11x. (TYK)
ALAM (5115)	10/9/2012	RM0.51	BUY	RM0.56
Share price has fallen back to RM0.51 despite showing signs of recovery in earnings in 2QFY12 that subsequently saw share price reaching a high of RM0.59. We don’t see much downside given it is trading near its 52weeks low of RM0.49 with 2HFY12 expecting to be even stronger owning to 1) fleet utilization of 75% 2) execution of the remaining RM120mil SOGT project & BCOT job worth RM50mil 3) strong tenderbook of RM1.3bn mainly from the underwater segment. Currently trades at only 7xFY12PE. Buy (TYK)