MORNING CALL 10 April 2012
FLOWS;
BUYS: TNB, Tebrau, Sime
SELLS: TM, Digi, MRCB
Technical Stock Alert;
LBS (RM0.88) - We first recommended the stock on 22 Mar at RM0.79, the current price has now hit immediate stretch target of RM0.88 thus advice to lock in some profits at this juncture with a consolidation expected ahead with support at RM0.85. Rumours over the weekend renewed interest in the counter on talks that it is mulling a possible sale of its 50% stake in two JV companies in Zhuhai,China.
BHIC (RM3.19) - its wholly owned sub was today awarded a contract to undertake engineering and integration works in connection with the DCNS Setis Combat Management System together with procurement of the CMS and Rheinmetall Fire Control System at a ceiling sum of RM1.53bn for upto ten years. +ve
Technically the price as has retraced substantially from its year high of RM4.12 when it secured the RM9bn contract to build 6 Naval combat ships. Should see some small technical rebound to 3.38/40 level with RSI down below 20. Medium/long term prospects remain bright if they do not encounter any execution problems with another 15 naval vessels in the pipeline.