FLOWS;
BUYS: CIMB, IOIC,
Digi
SELLS: KNM, JCY,
SIME
Technical Stock Alert;
1) SUPERMAX (RM1.88) - Its price has eroded from a year
high of RM2.37 in Jan to settle at current levels on concerns of rising raw
material costs. Both RSI and price seems to be finding some support now with
MACD indicating a positive divergence. A bounce back could see an immediate
upside of RM2.08. Recently the company has been decommissioning old NR lines
and replacing them with new nitrile lines. This will change their product mix
in favour of nitrile by 2013 where nitrile will represent 52% of production capacity.
2) 3A Resources
(RM1.23) - 3A a manufacturer of liquid caramel, caramel color, soya protein
sauce, glucose syrup, and maltose syrup has seen a recent pick up in volume and
share price from a low of RM1.13. Company had setup a 50:50 JV with Wilmar in
2010 to invest up to USD40mil in China where share prices peaked at RM2.32.
China operations has just started its operations in 4Q2011, this could see
earnings contribution starting 2012.
Trading Buy on 3A with earnings growth and contribution
from China, and recovery of its margins. Price is also substantially lower than
last placement price of RM1.74 in July 2010