Tuesday, April 24, 2012

Morning call | 24 April 2012

Morning Call                        24 April 2012

Flows: 

Buys: Armada, CIMB

Sells: WCT, AirAsia, MAS

Technical Stock Alert: 

Benalec - (RM1.12)- Stk formed a double top at RM1.40 lvls but has since reversed its trend to make a new recent low at RM1.12. Technically looks oversold as RSI languishing at 26 whilst MACD is flattening out. Immediate support should hold at RM1.10, otherwise stronger support is seen at RM1.
- exciting prospects in coming quarters as co concentrates on its core business focusing in Johor where it is in the process of reclaiming 3485 acres in Tg Piai and 1760 acres in Pengerang over the course of 10-15 years. Both these locations have been earmarked for the development of Johor into a oil hub.
- further rerating catalyst should co be awarded more reclamation jobs in Melaka, Penang and Singapore.
- Trading at undemanding PE of 7.8x with a potential of 50% earnings growth in the following year. Accumulate on weakness.
 
Plantation
Name    24/4/2012 YTD    Comment

Small/Mid Cap

TSH                  2.47 30.00% MACD cutting down, break below RM2.44.
                         could see share price retest RM2.26 levels.

TWSPLNT        5.59 28.80% MACD cut down. Broken below RM5.57
                         could see share price retrace to RM5.20 (61.8% level)

TDM                4.73 25.80% MACD cut down. Breaking below RM4.66
                         could see share price retrace to RM4.32

SOP                 6.87 22.90% Share trading near all time high RM6.95,
                        MACD is negative, RSI 60.69

RSAWIT         1.1 18.92% MACD cutting down, key support RM1.10,
                       violation would see share price retrace to RM1.00 level


Big Cap
KLK            24  8.79%
IOI          5.35  0.77%
SIME         9.73  6.09%


Recent weakness in global equity market has seen CPO futures falling from its high of RM3628/MT To RM3475/MT breaking below its upward trendline. Current chart is showing a head and shoulder pattern and should it fall below RM3426/MT, index could retrace to RM3224/MT level. Lock in profit on recent outperformers. BOW Sime-underperforming big cap and most liquid proxy to plantation sector.