FLOWS
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WEDNESDAY,
26 Sept 2012
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BUY
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CIMB,
SUPERMX, YTL
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SELL
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DIALOG,
IOIC, PCHEM
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Stock Alert
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STOCK
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DATE
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PRICE
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BUY/SELL
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TARGET PRICE
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IJM
(3336)
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26/9/2012
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RM4.75
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Trading BUY
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RM4.92
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Share price retreated 7% yesterday following its announcement that IJM
will be acquiring up to 25% stake in O&G entity Scomi Group, comprising
new shares & convertible bonds for up to RM149m. We feel the sell-down is
excessive as move appears to be part of IJM’s strategic plan to gain a
foothold in the O&G business, as well as possibly reap synergies from its
prowess in rail related civil engineering works and Scomi Engineering (
Scomi’s 67% unit). We expect no immediate earnings impact as the initial 10%
stake will place Scomi as a simple investment rather than associate. This is
also not the first time IJM had bought stakes into other related companies,
having done so with Keuro, Eversendai & fabricator Torsco SB prior. The
RM39m initial investment is fairly small compared to IJM’s cash reserve of
cRM1.8b & market cap of cRM7b. The sell-off has erased more that RM500m
off IJM’s market cap which we feel is overdone. We advise a trading buy
around the RM4.60 levels with an exit above the RM4.80 levels ahead of a
company briefing today when more clarity to its positioning in Scomi is
expected.
(AK)
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CANONE
(5105)
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26/9/2012
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RM2.54
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ACCUMULATE
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RM3.20
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The stock is down to its lowest levels since touching a year high of
RM3.16 in early July when we started to see board room changes in Kian Joo.
With the acquisition of 32% in Kian Joo finalized, Can One will be able to
factor in part of Kian Joo’s earnings and see potential synergies for their
own general can business and Kian Joo’s aluminium can products. Net earnings
for this year is expected to reach RM50m, which equates to 7.7x PE based on
current prices. Current weakness presents an ideal opportunity to accumulate
the stock for long term growth. Immediate target of RM3.20.
(DN)
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Calls for SEPT Week 3
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STOCK
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DATE
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PRICE
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BUY/SELL
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TARGET PRICE
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BURSA
(1818)
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19/9/2012
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RM6.22
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BUY
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RM6.60
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MUDAJYA
(5085)
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19/9/2012
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RM2.70
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BUY
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RM3.02
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PPB
(4065)
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20/9/2012
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RM12.14
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BUY
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RM13.10
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MAS
(3786)
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20/9/2012
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RM1.01
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Trading BUY
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RM1.16
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PHARMA
(7081)
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21/9/2012
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RM7.43
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Accumulate
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MidTerm TP - RM8.80
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DAYANG
(5141)
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21/9/2012
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RM2.00
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BUY
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RM2.20
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KLK
(2445)
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24/9/2012
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RM22.06
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TRIM
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RM20.00
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MAYBULK
(5077)
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24/9/2012
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RM1.41
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BUY
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RM1.60
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KULIM
(2003)
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25/9/2012
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RM4.68
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BUY
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RM5.00
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GENM
(4715)
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25/9/2012
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RM3.40
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ACCUMULATE
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RM3.60
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