Highlights of the day
§
DRB-Hicom
Bhd (Results Review): 2QFY13:
Below expectations (Maintain BUY, TP: RM3.45) [download
report]
2QFY13 revenue grew more than double contributed mainly
by the automotive followed by the services division. Revenue from automotive
was up more than three-fold largely due to the inclusion of Proton sales.
However, 2QFY13 net profit fell 23% y-o-y to RM81m as additional finance costs
from new borrowings, lower contribution from associates and JVs, and higher
effective tax rate derailed earnings. This brings 6M13 net profit to RM113m,
which fell below our and market’s expectation, forming only 29% and 26% of
house and consensus’ full-year earnings forecast. As we see high growth
potential in its automotive division from strong sales contributed by Proton
and Honda, its assembling collaboration with Volkswagen as well as its future
collaboration with Honda Motor, we leave our numbers unchanged and maintain our
Buy recommendation and target price of RM3.45.
§
Lafarge
Malayan Cement (Company Update): Watch out
for margins pressure (Maintain HOLD, TP: RM9.36) [download
report]
We attended Lafarge’s analyst briefing yesterday, coming out feeling
cautious on its margins going forward as more and more supply will come into
the market gradually. The potential capital repayment exercise, which the
market is eagerly awaiting, is still far from materialization. While we believe
that Lafarge will benefit from the growth in demand for cement, we see limited
upside for the stock considering its rich valuation. Lafarge is currently
trading near its peak forward PE of about 22x. Maintain HOLD with unchanged
target price of RM9.36..
Other reports
§ Axiata (Results Review): 3QFY12: Within house expectation
(Maintain HOLD, TP: RM5.22) [download
report]
§ KPJ Healthcare (Results
Review): 9MFY12: Within our but below market's (Maintain HOLD, TP: RM5.63) [download
report]
Other Malaysian news
§ CIMB:
Bidding for stake in Thai bank
§ IJM:
Likely to exit Scomi if bond deal falls through
§ S
P Setia: Launches Setia Investment Centre
§ S
P Setia: Inks Bangsar land swap deal with government
§ Scomi
Group: Shah Hakim fortifies hold on Scomi
§ Manufacturing:
Malaysian manufacturers see weaker prospects
§ Telco:
MCMC issues revised SRSP for 4G services in 2600 MHz spectrum
§
Economy: World Bank
expects 5% GDP growth next year
Global news
§ US
§ US
§
US
§ US: CBO says US
won’t reach debt limit before mid-February
§ Europe : Euro-area
economic sentiment unexpectedly rises in November
§ Europe : Greek
debt-buyback operation may address holdouts, Troika says
§
Japan
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