Tuesday, July 23, 2013

Morning Call |23 July 2013


FLOWS
Tuesday, 23 July, 2013
 
BUY
CIMB, GENM, PCHEM
 
SELL
DIALOG, JCY, KLK
 
 
 
 
STOCK ALERT
 
STOCK NAME
DATE
PRICE
BUY/SELL
TARGET PRICE
 
BRAHIMS (9474)
23/7/2013
RM1.00
Trading BUY
RM1.20
 
With new in-flight catering contracts secured and recent m&a exercise, group’s revenue and net profit is expected to show a substantial growth this year. Recent buy out of Brahim’s LSG sky chef holdings from LSG Asia will further boost the group’s revenue by a fold. Group also secured a RM10mil contract to cater food to names like (Air France, Phillipine Airlines, Turkish Airlines, Nas Air of Saudi Arabia and Xiamen Airlines) will continue to contribute to the division’s growth. Looking forward, group is planning to expand contributions from its f&B division by operating a 27k square ft food court and a higher end restaurant in KLIA2 for the next 3 years. Brahim’s chairman is confident that the group is able to maintain a modest 5% annual growth. Currently valuations demand a rerating on the back of recent acquisition of BLSG and would expect to see the stock be fully evaluated by 2014. Share price consolidated well around levels recorded its 2nd higher-high, higher-low and looks to create a 3rd yesterday. Volume picked up as the share price breached the 50days MA yesterday, MACD creeping upwards. Trading BUY with a near term TP of RM1.20
(RL)
 
 
 
WTK(4243)
23/7/2013
RM1.24
BUY on weakness
RM1.55
 
Stock has outperformed in the market recently due to the rising log prices, rising exports and turnaround in the Japan economy. Since January, log export prices in the country raised 30-50% and should continue to benefit the group’s margin looking forward. Also, recent win by favoured president, Shinzo Abe will continue to boost housing starts numbers as the government pledge to end a 15 years deflation and result in the recovery in property prices in the country. We feel that stock will continue to thrive as most of its log is exported to Japan and the overall timber division contributes 80+% to the group’s revenue. Currently stock is only trading at 11x PE compared to its average of 16x and peers of 15x mean. About 0.44x p/b vs. historical of 0.52x. Accumulate on weakness with a revision of TP to RM1.55 from our initial TP of RM1.20 based on 14x PE.
(RL)
 
 
 
Calls for JULY week 2 / week 3
 
STOCK
Initiation Dates
Initiation price
BUY/SELL
TARGET PRICE
LAST PRICE
% Change since Initiated
 
JOHOTIN(7167)
16/7/2013
RM1.97
BUY
RM2.60
RM1.90
-3.6%
 
GENM(4715)
16/7/2013
RM3.99
Take profit
RM3.68
RM3.90
-2.3%
 
PRESBHD (5204)
17/7/2013
RM2.11
Trading BUY
RM2.80
RM2.10
-0.5%
 
HSL(6238)
17/7/2013
RM2.02
BUY
RM2.60
RM2.08
+2.9%
 
WASEONG (5142)
18/7/2013
RM1.96
BUY
RM2.33
RM1.95
-0.5%
 
MUDAJYA (5085)
18/7/2013
RM2.70
BUY
RM3.44
RM2.68
-0.8%
 
MAYBULK (5077)
19/7/2013
RM1.85
BUY
RM2.30
RM1.80
-2.8%
 
DAYA(0091)
19/7/2013
RM0.255
BUY
RM0.295
RM0.27
+5.8%
 
THHEAVY(7206)
22/7/2013
RM0.945
Trading SELL
RM0.85
RM0.91
-3.8%
 
SAM(9822)
22/7/2013
RM2.45
BUY on weakness
RM3.00
RM2.55
+4.0%
 

 

 
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