MORNING CALL 31 JULY
2012
FLOWS;
BUYS: YTL, MRCB, Axiata
SELLS: Maybank, DRBHcm, AMMB
Technical Stock Alert;
PARKSON (RM4.76) - stock has underperformed this year,
-15% YTD on the back of weaker economic conditions. It represents a cheaper
entry to its two other listed subsidiaries, 67.6% Parkson Retail Asia and 51.5%
Parkson Retail Group, whose combined value is approx RM5742m vs current market
cap of RM5196m. They would be an obvious beneficiary from the expected
quantitative easing from Western Central Banks with exposure to the fast
growing economies of China, Indonesia, Vietnam and Malaysia.
Technically it looks to be forming a head and shoulder
pattern, with an immediate breach of RM4.80, potentially reaping an upside of
around RM5.20. MACD is also hooking up. BUY
(DN/AL)
Genting (9.26) - buy Genting coz risk-on trades are back in vogue due to
expectations of QE3, ECB/EU determination to bring borrowing costs down and
talks of China's injection of further stimulus. This is especially so with
global funds generally being under-weighted in equities. Evidence can be seen
from regional gaming stocks like Sands China, Wynn Macao, Galaxy & Melco,
have already rebounded strongly the last 2 trading days, putting on gains of
12-14%, despite the recent negative sell-side reports due to slowing Macao
gaming growth & speculation of restriction on visas for Chinese tourists to
Macao.
Genting S'pore, a 52% sub, also rebounded 8% yesterday.
Genting, a major laggard this year (down 16% ytd vs KLCI +7%) and trading at
FY12/13 PER of 10.9x, coupled with being a foreign favourite whenever they
allocate funds to M'sia, is a compelling buy in the current environment.
(PT)