MORNING CALL 18 JULY
2012
FLOWS;
BUYS: Affin, CIMB,
Perisai
SELLS: TNB, Digi,
GentM
Technical Stock Alert;
SIME (RM9.96) - remains the cheapest big planter trading
at 13.4x PE with a gross yield of 3.2% vs IOIC 17.4x PE, 2.7% yield, KLK 17.2x
PE, 3.6% yield and FGV 16x PE, 2.9% yield. They are set to be a main
beneficiary of expected higher CPO prices in the 2H with 522,900 ha planted of
which 58% is in prime maturity stage. Technically the price has been flirting
with the RM10 mark and a push above this psychological resistance should see it
achieve an immediate upside target of RM10.80-RM11.00. BUY
GENTING (RM9.43) - price has retraced from our initial
upside target of RM9.85 after our earlier trading buy call. Current pull
back is dragging it to interesting levels again for a short term trade with a
buy call at current levels with a stop loss of RM9.35. Upside potential remains
a 4-5% spread to around RM9.80-RM10.00. Recent announcement of entering a
Greenfield power project in Indonesia will not have any immediate impact but on
the longer term expand its power portfolio in a rapidly growing economy and
further diversify its earnings base. Trading BUY.
(DN/LJN)