MORNING CALL 4 JULY
2012
FLOWS;
BUYS: Maybank, PChem, Affin
SELLS: BJtoto, MRCB, SIME
Technical Stock Alert;
YTLPower(1.78) - Tan Sri Francis Yeoh had showed his hand
with his move on YTL Cement and the recent performance of YTL Corp, YTLPower is
a prime candidate for takeover as this would enhance the fundamentals and
create value for the family flagship with this exercise. YTLP trades at
FY13 PER of 10x and p/bk 1.4x versus YTL's FY13 15x and p/bk 1.7x. Even if
the deal does not pan out, YTLP is trading close to the low end of its
historical PE band and 1 standard deviation from its historical mean p/bk. This
is extremely attractive for a well-diversified utility company. None of its
peers in the utility sector has such diversifications in business and
geographical spread. Buy
(PT)
Media Prima (RM2.23) Share priced has retraced some 20%
from it's recent high of RM2.78, largely due to disappointing 1Q2012 earnings,
which was attributable to weak TV adex which fell 20% yoy. We view the 1Q
weakness as more of a timing issue, and expect earnings to recover strongly in
the subsequent quarters. Management indicated that some contractual advertisers
held back spending in 1Q on concerns of potential contagion effects from
external uncertainties, as well as planning their spending to coincide more
with domestic & international events later in the year ( Olympics, Hari
Raya & GE13). Media's move to digitalize print would stretch it's lifespan
to remain relevant in the digital era. Newsprint has softened & remained
relatively flat. With it's strong position & best proxy in Malaysia due to
it's fully diversified media platform, virtual monopoly in the FTA TV segment
& dividend yield in excess of 5%, ACCUMULATE.
(AK)