Wednesday, October 17, 2012

Morning Call | 17 Oct 2012


FLOWS
Wednesday, 17 October, 2012
BUY
MRCB, TM, UOADEV
SELL
ARMADA, GENTING, LATEXX
Stock Alert
STOCK
DATE
PRICE
BUY/SELL
TARGET PRICE
FITTERS (9318)
17/10/2012
RM0.685
Trading BUY
RM0.80
The share price has retreated c19% from its recent high in July. Fitters is the market leader of integrated fire fighting business in Malaysia. However, renewable energy has been identified as its next growth driver. It’s new engine of growth, ie third party green palm oil milling, has finally been set in motion with the first 2 signings in July 2012 (with Indonesia based Anglo-Eastern Plantation & Tradewinds Plantation). The earnings from these 3rd party green mill ventures will be felt from FY13 onwards (estimated to be from 7% of group profit in FY13 to 29% in FY14 & 40% in FY15). Management is targeting 2 third party green mills in FY13, 8 mills in FY14 & 14 mills in FY15. Other potential catalyst may come from the group’s specialist theme park works & maiden property development project in Setapak. Trading at just 5-6x for FY13
 
 
MRCB (1651)
17/10/2012
RM1.68
ACCUMULATE
RM1.90
Stock has drifted south c13% from its recent high of RM1.93 in July on the back of the pending GE as well as uncertainties on the EDL  takeover price & final terms of the impending Nusa Gapurna SB ( NGSB ) transaction. We believe this to be just a temporary drag on the stock. We see it unlikely that the disposal price of the EDL to be less that RM1.4b, thus no loss to MRCB. And subject to final terms, the NGSB deal may be value enhancing. As the KL Sentral development is nearing the tail end, group is also eyeing additional landbank in Klang Valley & Penang. Outstanding construction OB amounted to cRM2b & group is actively looking for more jobs ( from new building construction works & opportunities in MRT2 / MRT3 ). Trading at 23x & 17x multiples for FY13 & FY14, and 40% discount to RNAV of RM2.88 -
 
Calls for OCT Week 2 / Week 3
STOCK
Initiation Dates
PRICE
BUY/SELL
TARGET PRICE
LAST PRICE
% Change since Initiated
KOSSAN (7153)
10/10/2012
RM3.05
BUY
RM4.00
RM3.09
1.3%
BENALEC (5190)
10/10/2012
RM1.30
Trading BUY
RM1.43
RM1.32
1.5%
GENTING  (3182)
11/10/2012
RM8.65
LT Accumulate
RM10.20
RM8.81
1.7%
GLOMAC (5020)
11/10/2012
RM0.815
Mid Term BUY
RM0.865
RM0.815
0.00%
NAIM (5073)
12/10/2012
RM1.80
LT Accumulate
RM2.02
RM1.84
2.22%
YTL (4677)
12/10/2012
RM1.74
Mid Term BUY
RM1.92
RM1.74
0.0%
REDTONE (0032)
15/10/2012
RM0.395
Trading BUY
RM0.50
RM0.40
1.2%
3A (0012)
15/10/2012
RM1.10
ST BUY
RM1.25
RM1.19
7.6%%
DRBHICOM (1619)
16/10/2012
RM2.38
Trading BUY
RM2.60
RM2.40
0.8%
SILKHLD (5078)
16/10/2012
RM0.35
Trading BUY
RM0.41
RM0.365
4.2%

 
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