News Bits | 23 August 2013

IDEAS OF THE DAY (SEE SEPARATE REPORTS FOR DETAILS)

l  Results Note:  BENALEC, GAB, MAGNUM, MBMR, NESTLE, PCHEM, PERISAI, PETGAS,  QL, SEB, WASEONG, WCT, YTLPOWR

l  On Our Portfolio: KIANJOO

l  On Our Technical Watch: DAIBOCHI, PADINI

NEWS HIGHLIGHTS

l  MSM M’sia 2Q profit soars 75% YoY to RM92.6m

l  icapital.biz to pay special dividend of 9.5 sen

l  Celcom targets single-digit growth in revenue yearly with launch of Escape

l  Sun Life Assurance aims to boost market position

l  DiGi keen on buying companies with low spectrum

l  AMMB to finalise insurance deal by year-end

FOREIGN NEWS HIGHLIGHTS       

l  Barrick to sell three Australian mines to Gold Fields

l  ICBC to lead China’s biggest banks in posting slower profit gain

 

ECONOMIC NEWS HIGHLIGHTS (MACRO BITS)

Malaysia

l  Malaysia Vehicle Sales Rise In July

l  Bank Negara Global Reserves At RM438.3b

 

Asia

l  China Manufacturing Activity Sees Sharp Rebound

USA

l  US Manufacturing Growth 'At Five-Month High'

l  U.S. Jobless Claims Fell To Five-Year Low Over Past Month

l  Leading Index Signals U.S. Growth To Pick Up Into 2014

l  Consumer Comfort In U.S. Declined Last Week To Two-Month Low

 

Europe

l  Eurozone Growth Hits 26-Month High, Says PMI Survey

 

Currencies

l  Dollar Follows Bond Yields Higher After Data

Commodities

l  Oil Edges Up On Strong China, Euro Zone Data

l  Gold Up After Chinese PMI Data, Downside Risk Seen.

Market Roundup | 22 August 2013

FBMKLCI   1720.37  -24.48pts  (-1.40%)   Volume  2.435b   Value RM3.443b

1) The KLCI gapped down -20pts at the opening following weaker 2Q GDP numbers and release of FOMC minutes that showed support for QE tapering. Index touched a low of 1710.17 (-34.68pts) after midday before some bargain hunting saw markets recovered to close down 25pts. Regional markets bounced off low after HSBC PMI came in better than expected. In the local market, BANKING stocks continue to see plenty of liquidity as CIMB, MAYBANK and  AMBANK lead in volume among the bluechips. Market breadth was negative with losers once again towering over gainers by 904 : 76. Futures closed 1713pts (7 pts discount).

2) Heavyweights : TENAGA -3.83% RM8.52, PBBANK-1.40% RM16.90, MAYBANK-1.30% RM9.87, MAXIS-2.08% RM7.00, IOICORP -1.88% RM5.20, AXIATA -1.05% RM6.58, GENM -2.41% RM4.05, CIMB -0.78% RM7.56, RHBCAP-5.2% RM7.30.

3) DBT : TIGER 5mil @ RM0.245 (1.295% PUC @ 6.5% premium), TECFAST 4.939mil @ RM0.10 (3.168% PUC @ 13.1% discount), AFG 2.3mil @ RM5.40 (6.9% premium)

4) Situational:-

KIMLUN -1.01% RM1.95: Kimlun announced its unit, Kimlun Sdn Bhd, had secured a contract to construct two towers of serviced apartments and ancillary buildings in Johor Bahru. The job, awarded by Wealthy Growth Sdn Bhd, a subsidiary of IOI Properties Berhad, is worth RM296.4mil, with work expected to be completed by May 2016.

5) WCT

1H June 2013   Tover +32% RM973.5m   Net +25.6% RM99.9m   EPS 9.5sen

                        In line with cons(f) RM202m

The better numbers were attributable to civil engineering and construction which recorded revenue of RM666m and op profit of RM89m due to higher contribution from the local div. Property development and investments saw revenue grow 54% to RM307m and op profit of RM62m due to higher sales recorded from property launches. Company declared an interim div of 3.5sen.

Outstanding order book of RM2.8bn and the best local proxy for exposure to Qatar World cup contracts. BOW

6) Market - Current sell off momentum could see the market test the 1700pts level with a stronger support at 1680pts.

 

Morning Calls | 22 April 2013

FLOWS

Monday, 22 April, 2013

BUY

CIMB, DIGI, BENALEC

SELL

GAMUDA, MUDAJAYA, MAS

STOCK ALERT

STOCK NAME

DATE

PRICE

BUY/SELL

TARGET PRICE

TCHONG(4405)

22/4/2013

RM5.61

Take Profit

RM5.05

Group jump started the year with a sales boom from its recently launched B segment car, Nissan Almera, which did well to help Nissan secure 9% market share of total vehicle sale in Malaysia for the first 3 months of 2013 and recent weaker YEN. However latest industry numbers are already showing a slowdown as more uncertainty from the GE13 as well as a potential car price exercise duty reduction after the GE  keeping buyers at bay until further clarification. Stock rose some 18% since the beginning of the year behind more +ve news flow but looks like it has peaked at RM5.72 and have started its pull back. Current RSI at 66% while MACD is turning down; we recommend investors to lock in profit and buy back at RM5.05 (50% fibo) Take profit. Buy back  of TP RM5.05 (RL)

MAHSING(8583)

22/4/2013

RM2.28

BUY

RM3.00

Mahsing is fast becoming a proxy in the Malaysian property sector as it is currently the 2nd largest developer by sales value and is currently working on 40 projects. The group has been aggressively expanding and buying more land to prepare for the future. Mahsing’s product range spans from affordable housing to premium up market homes, high rise units, commercial properties and industrial. Beside the 6 new projects launches this year, M Residence 2 in the Klang Valley, Ferringhi Residence in Penang island, Mah Sing iParc@Tanjung Pelepas and The Meridin@Medini which are located in Iskandar Malaysia and Sutera Avenue in Kota Kinabalu, the group is also excited to start developing Southville City, Bangi which has a gdv of RM3.6b where 1/3 of it is expected to be launched this year. Management is confident that the group’s growth is sustainable and has revised this year’s sales target to 3bil from 2.5bil. Technical – MACD currently trading above the baseline (0) and looks like it’s about to cut up. Currently only trading at cheap valuations of 8x PE, pays 5% div, est RNAV at RM3.18. BUY with a TP of RM3.00. (RL)

Calls for APRIL Week 2-3

STOCK

Initiation Dates

Initiation price

BUY/SELL

TARGET PRICE

LAST PRICE

% Change since Initiated

AIRASIA(5099)

15/4/2013

RM2.84

Situational BUY

RM3.30

RM2.95

+3.9%

DIGI(6947)

15/4/2013

RM4.69

Technical BUY

RM5.08

RM4.67

-0.4%

TAGB(5158)

16/4/2013

RM0.245

ACCUMULATE

RM0.33

RM0.24

-2%

IJM-WC (3336WC)

16/4/2013

RM1.36

BUY

RM1.80-RM2.00

RM1.50

+10.2%

AIRPORT(5014)

17/4/2013

RM5.70

BUY on weakness

RM6.40

RM5.81

+1.9%

PLENITU(5075)

17/4/2013

RM1.97

Strong BUY

RM2.52

RM1.98

+0.5%

WASEONG(5142)

18/4/2013

RM1.63

ACCUMULATE

RM1.84

RM1.63

0.0%

PANTECH(5125)

18/4/2013

RM0.755

BUY

RM0.85

RM0.75

-0.6%

HSL(6238)

19/4/2013

RM1.54

ACCUMULATE

RM1.74

RM1.55

+0.6%

TAANN(5012)

19/4/2013

RM3.52

BUY on weakness

RM4.10

RM3.52

0.0%