Morning Call | 5 Sept 2012

FLOWS	Tuesday, 5 September, 2012
BUY	SIME, UEMland, YTL
SELL	JCY, Maybank, MRCB
Stock Alert
STOCK	DATE	PRICE	BUY/SELL	TARGETPRICE
SUPERMAX (7106)	5/9/2012	RM2.13	BUY on weakness	RM2.50
Share price has fallen some 13% from its high of RM2.25 to its 100 day SMA (RM1.99) before rebounding, within the last 3 weeks. We see a resurgent in the glove industry with the underlying downtrend in its main cost components - prices of natural rubber & nitrile. Despite the slowdown in the Eurozone & US, strong demand is seen from other regions such as Middle East, Africa & Asia. Management has guided that it will be spending RM70m to automate its operations & has no upstream plans to buy rubber plantation (seen as +ve as will be more focused on manufacturing). Trading at multiples of 10.5x & 9.3x for FY12/2012 & 2013, it is at the lower end of its average historical PERs of 11x-13x. BOW. (AK)
JAYATIASA (4383)	5/9/2012	RM2.45	Accumulate	RM2.80
Over the past 5 months, share price has retraced some 26% from its high of RM3.38. Management has guided that log volumes are picking up although prices were on the downtrend last quarter, and that Co is making good traction for FFB growth. The average age profile of group’s oil palm plantation is very young at about 4-5 years, as majority of trees are either immature or young mature at 4-6 years old. This will underpin FFB production growth. Oil palm contributes about 65% of earnings currently & up to 70% by FY06/13 onwards. Liquidity of shares has also improved, post it’s bonus issue & 15% private placement, issued capital is now 974m shares (from 283m shares). Trading at below 13x PE for FY06/13, we like Jayatiasa as there could be a potential re-rating, boosted by earnings from plantation (increasing FFB production volume & favorable CPO prices). MACD appears to be cutting up with RSI at 32. – Accumulate. (AK)
Calls for August Week 1/ Sept Week 1
STOCK	DATE	PRICE	BUY/SELL	TARGETPRICE
KIANJOO (3522)	28/8/2012	RM2.73	SELL Into Str	RM2.50
IHH (5225)	28/8/2012	RM3.11	Long Term BUY	RM3.55
GENM (4715)	29/8/2012	RM3.36	Accumulate	RM3.70
SUNWAY (5211)	29/8/2012	RM2.25	BUY on weakness	RM2.70
QCAPITA (5123)	30/8/2012	RM1.14	Long Term BUY	RM1.20
MBSB (1171)	30/8/2012	RM2.36	Trading BUY	RM2.70
CANONE (5105	3/9/2012	RM2.79	BUY	RM3.10
MRCB (1651)	3/9/2012	RM1.69	Trading BUY	RM1.90
NAIM (5073)	4/9/2012	RM1.87	BUY	RM2.20
PERDANA (7108)	4/9/2012	RM0.715	Short/Mid Term BUY	RM0.81/RM1.00