FLOWS
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Friday, 3 May, 2013
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BUY
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MAXIS, IJM, MAS
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SELL
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GENM, TENAGA, KNM
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STOCK ALERT
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STOCK NAME
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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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MISC(3816)
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3/5/2013
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RM4.30
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BUY
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RM4.97
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Stock is trading just 10%
off its decade low following the failed privatization exercise by Petronas
which resulted in cut-loss selling from those who bought the shares to take
advantage of the general offer. This can
be seen from the sharp reduction in trading volume as compared to last week
when the shares were initially returned to the shareholders. Before this
cut-loss selling is completed, investors should take advantage of this
opportunity to buy the stocks. From the recent exercise, we know that about
80% of the shareholding belonging to Petronas, EPF, PNB and KWAP will not
sell at current levels. The fundamentals of MISC has also improved since the
Q4 2012 post the selling of the container shipping division. Gemusut Kakap
rig will commence from Q3 and increase contribution from the offshore
division. Tank terminals saw increased earnings of 30% last quarter from the
Tanjong Bin terminal and is expected to increase further when additional
phases come into operation. Even the loss-making petroleum tanker division
has seen some improvement with tanker rates 7% higher in Q1 2013 vs Q4 2012 .
The LNG business alone is valued at RM5.00/share and is looking to add 9 new
vessels with likely 20 years charter from Petronas from 2013. Further ahead,
Petronas JV in the Australian Gladstone project and Canadian Progress Venture
will mean more requirement for MISC’s LNG transportation. MISC currently
trades at an attractive 0.91x P/Bk which is significantly lower than the
5-year average of 1.53x. Buy (PT)
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PETDAG(5681)
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3/5/2013
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RM23.52
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Trading SELL
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RM20.00
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Stock has held near its all-time high of RM23.86 despite potential
earnings hiccup in the next few quarters as selling prices (hence gross
margins) are impacted by lower Means Of Platts Singapore (MOPS) prices. MOPS
prices are correlated to Brent Crude which has fallen by more than 15% since
it peaked in early February, and looks to have more downside with the break
of support at USD104.70/barrel and targeting a downside objective of
USD90/barrel (an additional 10% downside). In addition, Petdag is trading at
lofty valuations as measured by its PER and P/Bk - 25.0x historical PER and
23.3x forward PER versus its 5-year average 17.1x PER, and current P/Bk of
4.86x versus its 5-year average P/Bk of 2.70x. Petdag also does not look good
technically as its price charts exhibit weekly negative divergences against
its momentum & trend indicators. Trading sell with buy back target at
RM20.00. (PT)
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Calls for APRIL Week 4/ May
Week 1
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STOCK
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Initiation Dates
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Initiation price
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BUY/SELL
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TARGET
PRICE
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LAST PRICE
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% Change since Initiated
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BHIC(8133)
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25/4/2013
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RM2.20
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ACCUMULATE
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RM2.53
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RM2.08
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-5.7%
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MRCB(1651)
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25/4/2013
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RM1.38
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BUY on weakness
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RM1.68
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RM1.40
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+1.4%
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MUHIBAH(5703)
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26/4/2013
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RM1.12
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ACCUMULATE
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RM1.60
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RM1.11
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-0.9%
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MAYBULK(5077)
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26/4/2013
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RM1.53
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BUY on weakness
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RM1.80
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RM1.51
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-1.3%
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TENAGA(5347)
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29/4/2013
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RM7.83
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TRIM
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RM7.30
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RM7.79
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-0.5%
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SPSETIA(8664)
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29/4/2013
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RM3.30
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ACCUMULATE
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RM4.40
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RM3.48
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+5.4%
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PETGAS(6033)
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30/4/2013
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RM19.64
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Sell into strength
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RM18.50
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RM20.00
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+1.8%
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PCHEM(5183)
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30/4/2013
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RM6.49
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Sell into strength
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RM6.00
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RM6.50
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+0.1%
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WTK(4243)
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02/5/2013
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RM0.975
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BUY
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RM1.20
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RM0.97
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-0.5%
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MPHB(3859)
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02/5/2013
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RM3.52
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BUY
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RM4.20
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RM3.50
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-0.5%
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