Highlights of the day
§ Malaysia
Malaysia Marine and Heavy Engineering’s (MMHE)’s high PE valuation is unwarranted, considering its smaller net income and market capitalization compared to closest peers Sembcorp Marine and Keppel Corp. MMHE is trading at a hefty PE of 22x or 51% premium over average regional peers. The slower-than-expected order book replenishment, increasing competition and higher effective tax rate are likely to dampen its earnings over the next 12 months. As such, we are cutting our FY12-14 net profit by 19-21%. Correspondingly, we downgrade our target price to RM4.96, pegged against 18x FY12 EPS (-1 SD). Downgrade our HOLD call to SELL.
Other reports
§ Newz Bits [download report]
Other Malaysian news
§ Genting Group: NY Convention centre project may come with a casino license
§ Genting Malaysia : Considering US$4bn complex in New York
§ SapuraCrest: Unit in vessels deals with Cosco Shipyard
§ IGB Corp: To open two hotels in Penang
§ Eversendai: To bids for jobs worth RM12bn
§ BHIC: Refutes privatisation talks
§ TDM: To invest RM300m in plantations
§ Xidelang: Navis Capital may take over
§ Construction: River of life tenders up for grabs
§ Power: Pengerang power plant likely to supply electricity to Singapore
§ Property: CapitaLand to manage project in Iskandar
Global news
§ US: Private hiring soars
§ US: Jobless claims dropped 15,000 last week to 372,000
§ US
§ US: Makeup of leading economic indicators index to change
§ Europe : Industrial orders increase less than estimated
§ Europe : German retail sales unexpectedly decline for a second month
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