|
FLOWS
|
Thursday, 26 June, 2014
|
|||||||||||||
|
BUY
|
SKPETRO,
PBBANK, SIME
|
|||||||||||||
|
SELL
|
UMW, GENM, IHH
|
|||||||||||||
|
STOCK ALERT
|
||||||||||||||
|
STOCK NAME
|
DATE
|
PRICE
|
BUY/SELL
|
TARGET PRICE
|
||||||||||
|
ARMADA (5210)
|
26/6/2014
|
RM3.52
|
ACCUMULATE
|
RM4.03
|
||||||||||
|
Armada (RM3.52) – is likely to test the recent low of
RM3.49 to complete a 5-wave correction from a 2/4/14 RM4.03 high. Yesterday
trading saw an increase in volume with significant portion of the volume
being OMTM crossings which signify that block buyer(s) have found the prices
appealing at current levels. We rate this last leg of correction as a low
risk area to start accumulation of the stock before the sellers are
exhausted. Armada looks set for a sharp improvement in bottomline for FY15
with 2014 being such a busy year compared to 2013. After Armada Claire FPSO set
sail in Feb’14, the company is working on the conversion works of Armada C7
FPSO (target completion by 3Q14) and Kraken FPSO (target completion by 1H16).
Concurrently, Armada is actively bidding for 10 FPSO prospects worldwide.
Notable mentions are Eni’s East Hub project off Angola (USD1.5b) and Husky’s
Madura development off Indonesia (USD1.2b) where Armada is tipped as the
frontrunner. Sentiment on Armada was affected by the lower reported profit
due to the change in accounting policy this year from treating all FPSO
contracts as operating leases (recognition of revenue & profit from the
conversion period) to treating longer tenure, large scale FPSO projects as
financial leases (minimal recognition of recognition of revenue & profit
during the conversion period) but has no impact on the company’s underlying
project economics, i.e. project cash flow & IRR. Armada’s recent RM1.5b
Sukuk debt raising exercise will reduce its conventional debt to about 25% of
its total assets, well below the Syariah threshold of 33%, hence management’s
initial deliberate attempt to get back to the Syariah list. Armada trades at
FY15 & FY16 PER of 16.8x & 14.5x respectively, significantly lower
than its historical PER of 28.1x. Accumulate
(PT)
 |
||||||||||||||
|
KULIM (2003)
|
26/6/2014
|
RM3.46
|
TRADING BUY
|
RM3.98
|
||||||||||
|
Kulim (RM3.46) – a potential crystallization of investments
in New Britain Palm Oil Ltd (NBPOL) & E.A Technique (M) Bhd (EAT) and the
potential distribution of special dividends post the unlocking of value are
rationale for a trading buy call on Kulim. EAT is the oil & gas division
of Kulim and is scheduled to be listed in the second half of 2014. EAT is
involved in the transportation of clean petroleum products and upstream
exploration support for oil majors. It has a total fleet of 32 marine
vessels, including 9 vessels chartered from third parties, and has an
outstanding order book of RM1b. Kulim has a 49% stake in NBPOL and it has
been reported that 7 major listed plantation players in Malaysia & Asean
are interested to bid for Kulim’s stake. Now is an opportune time to buy for
a trade before the bidding process commences in the first week of July. The
charts are also indicating better days ahead with NBPOL breaking above the
stubborn GBP4.27 resistance, confirming a bullish flag pattern, and Kulim
reclaiming its SMA200 at RM3.44. Recent Bursa filings have reported that KWAP
has been accumulating Kulim. Trading buy
(PT)
 |
||||||||||||||
|
|
||||||||||||||
|
Calls for JUNE WEEK 3/ WEEK 4 2014
|
||||||||||||||
|
STOCK
|
Initiation Dates
|
Initiation price
|
BUY/SELL
|
TARGET PRICE
|
LAST PRICE
|
% Change
since Initiated
|
||||||||
|
TUNEINS (5230)
|
19/6/2014
|
RM2.34
|
ACCUMULATE
|
RM2.60
|
RM2.30
|
-2.6%
|
||||||||
|
JTIASA (4383)
|
19/6/2014
|
RM2.49
|
ACCUMULATE
|
RM2.94
|
RM2.58
|
+3.6%
|
||||||||
|
PERDANA (7108)
|
20/6/2014
|
RM1.80
|
ACCUMULATE
|
RM2.10
|
RM1.89
|
+5.0%
|
||||||||
|
ALAM (5115)
|
20/6/2014
|
RM1.56
|
ACCUMULATE
|
RM2.10
|
RM1.57
|
+0.6%
|
||||||||
|
CBIP (7076)
|
23/6/2014
|
RM4.40
|
BUY
|
RM5.10
|
RM4.44
|
+1.0%
|
||||||||
|
HOHUP (5169)
|
23/6/2014
|
RM1.41
|
BUY
|
RM2.30
|
RM1.38
|
-2.1%
|
||||||||
|
KUB (6874)
|
24/6/2014
|
RM0.555
|
TRADING BUY
|
RM0.725
|
RM0.535
|
-3.7%
|
||||||||
|
GKENT (3204)
|
24/6/2014
|
RM1.90
|
TRADING BUY
|
RM2.67
|
RM1.85
|
-2.7%
|
||||||||
|
AHEALTH (7090)
|
25/6/2014
|
RM3.81
|
BUY
|
RM4.40
|
RM3.95
|
+3.6%
|
||||||||
|
FGV (5222)
|
25/6/2014
|
RM4.41
|
BUY
|
RM4.80
|
RM4.34
(ex)
|
-1.6%
|
||||||||
|
Performance
|
|
|
Positive
|
|
|
Negative
|
|
|
Neutral
|
|
