Friday, May 25, 2012

News Bits | May 25 2012


Highlights of the day
§  Lion Industries (Results Review): 3QFY12: Down but not out (Maintain STRONG BUY, TP: RM2.00) [download report]
Lion Industries’ 9MFY12 results missed expectations due to sluggish sales of steel products coupled with higher raw material prices, particularly scrap iron which accounts for about 70% – 80% of its steel production. We foresee the group’s steel outlook to be challenging over the next quarter or two due to flattish long steel prices coupled with high scrap prices. However, we remain sanguine that the steel division will return to the black by 2HFY13 with stronger steel sales growth on the back of increased infrastructure and property development activities in the Klang Valley and Iskandar regions. We see the stock as a deep-value play on the Malaysian construction sector, trading at CY12 forward P/B of 0.3x compared to its peer average P/B of 0.5x. Sum-of-parts TP is lowered to RM2.00 from RM2.16 previously, as we incorporate current market prices of its listed units and our in-house target price for its 17%-owned associate Parkson Holdings Bhd. Maintain STRONG BUY. 
Other reports
§  Kossan Rubber (Results Review): Weak 1QFY12 results, subsequent quarters to be better (Maintain BUY, TP: RM4.02) [download report]

§  CIMB Group Holdings (Results Review): 1QFY12: Slow start to the year (Maintain HOLD, TP: RM7.00) [download report]

§  Malayan Banking (Results Review): 1QFY12: distorted by trading gains (Maintain HOLD, TP: RM8.25) [download report]

§  Kuala Lumpur Kepong (Results Review): 2QFY12: Below expectations (Maintain HOLD, TP: RM18.53) [download report]

§  Newz Bits [download report]

Other Malaysian news
§  SapuraKencana: Received extension for contract
§  Maxis: Unveils personal cloud service
§  TM: In strategic partnership with ChinaCache
§  PPB: Unit to spend RM90m to expand Indonesian mill
§  RHB-OSK: SC approves merger
§  AEON: Looks East
§  WCT: Plans two more malls
§  CCM Duopharma: Eyes opportunities in generic drugs
§  Deleum: Bids for RM1bn jobs
§  KHSB: Earmarks Pulau Indah land for RM8bn project
§  Permaju: Board to meet on Sepangar project
§  Scomi Engineering: 4-car trains on track
§  Bina Puri: To diversify into power and mining
§  Power: Government to get tough with IPPs
§  Banking: Indonesia ruling may hurt Malaysian banks' earnings
Global news
§  US: Initial jobless claims declined by 2,000 last week
§  US: Demand for business equipment fell in April
§  US: Manufacturing grows at slowest pace in three months
§  Europe: Merkel gives ground on austerity in bid to pass crisis bills
§  Europe: EU urges Greece to stay in euro, plans for possible exit
§  Europe: Manufacturing shrinks, German confidence drops


Visit ECM Libra at https://www.ecmlibra.com/ecmlsmy
Our on-line trading portal at www.ecmmoney.com
at