MORNING CALL 27 February 2012
FLOWS;
BUYS: JCY, Maybank, Sime
SELLS: TNB, Gamuda, TM
Technical Stock Alert;
Three A (RM1.23) - Price approaching support levels of RM1.20 after touching a 2012 high of RM1.44. These levels represent a good level to accumulate again ahead of the commissioning of its maiden China JV F&B ingredients plant in China with Wilmar. Wilmar is a major shareholder with a 16% stake.
Salcon (RM0.52) - Earlier run up on water related counters this year drove its price to a high of RM0.67 before profit taking sent it tumbling back down again the past few weeks. The price is now finding support around the RM0.50 levels with an immediate bounce back target of RM0.60. The company in recent years has been diversifying into the region, in particular China where they now operate 9 water and waste water concessions located in Shandong, Fujian, Zhejiang Prov and Jiangsu
Prov.
Stock of the Day;
PARKSON (RM5.60)
- Planning to expand into the region after its success in China.
- Currently operates 49 outlets in China, 37 Malaysia, 8 Vietnam and 8 Indonesia.
- Future markets include Thailand, Myanmar, Philippines and Cambodia where they will open a first Outlet in 2013.
- Offers a cheaper entry to the two other Parkson listed entities, HK Parkson Retail Group and Spore Parkson Retail Asia Ltd which they own 51.5% and 67.6% respectively. Current PE ratio of Parkson Msia is 16.9x vs Parkson HK 19.2x and Parkson Spore 24.7x.
- Buy with a target of RM6.30
