Morning Call 27 AUGUST 2012
FLOWS:
BUYS: UEMLAnd, MRCB, Armada
SELLS: GenM, Genting, Maxis, Sime
Technical Stock Alert:
GenP (RM9.26) - stock has fallen 8% fr its peak of
RM10.20 and is sitting on the lower range of the Bollinger band. Strong support
at 200D SMA of RM9 with MACD flattening out after cutting down in mid July
following falling CPO average. Believe downside risk is limited as its a pure
upstream player with 85% of their earnings correlated to CPO price movement
which has been recovering since touching low of RM2800/ton to above RM3k now.
CPO has bottomed and is expected to edge higher on the back of weather woes,
discount btwn soy bean and CPO price and increased demand from festivities
going fwd. Its improving contribution from its Kalimantan ops will continue to
drive their FFB production fwd. Trading at fwd PER of 16x-BUY.
(LJL/LJN)
Airport (RM5.46) - Price is now trading at the low end of
it defined range for the year between RM5.00-RM6.00 with MACD chart showing
signs of bottoming out and has started to cut upwards. Stock is now trading
below the last private placement price of 110m @ RM5.60. We expect the stock to
steadily move higher as the main re rating catalyst draws nearer with the
commencement of KLIA 2 in April 2013, targeted to handle 45m passengers/annum.
Passenger vol grew 2.7% in June with intl passengers growing 4% to 2.34m in KLIA
mainly due to 12.4% rise in foreign airline movements and 8.7% growth in
AirAsia movements. Jan-June +4.2%(yoy) to 32.56m passengers. Dividend yield remains
attractive at 4.12%. Accumulate.
(TYK/LJN)