Monday, May 6, 2013

Morning Call | 6 May 2013


FLOWS
Friday, 6 May, 2013
BUY
CIMB, GAMUDA, IOIC
SELL
IJM, SPSETIA, TM
STOCK ALERT
STOCK NAME
DATE
PRICE
BUY/SELL
TARGET PRICE
TAMBUN(5191)
6/5/2013
RM0.94
ACCUMULATE
RM1.12
Despite the strong performance ( share price +56% over the past 6 months), we reckon the strong growth prospect of Co has not been fully priced in. The 600 acre anchor landbank in Simpang Empat where Pearl City, it's crown jewel sits, has a total GDV of RM3b ( commenced 2009 and expected to be completed in 2020), thus providing earnings visibility. The upcoming opening of the Penang Second Bridge in September 2013 will provide significant economic impact at the Batu Kawan area. Tambun's value is underpinned further by its capable management ( team completed development worth RM2.1b to date), quality products ( upside in pricing suggesting margin enhancement), strong Balance Sheet ( net cash cR90m ) & attractive dividend yield of c6-7%. Co is currently trading at about 5.9x FY13 ( 40% discount to the mid to small cap average PE of c9-10x) - Accumulate TP RM1.12  (based on PE6.6x FY14 )
 
SENDAI(5205)
6/5/2013
RM1.07
BUY
RM1.41
The share price has corrected c26% over the past month, after the sharp run-up to RM1.44 in early April 2013. Co recently announced that it had secured it's maiden project in Azerbaijan worth RM87m, bringing YTD jobs secured to RM412m & outstanding OB close to RM2b, which could last it for another 2-3 years. Management has guided that it was in line for further contract wins in the region. Over the past year, the share price has retreated c32% from its peak of RM1.64 in June 2012. Group remains a good proxy to the infrastructure boom in the Middle East (esp Qatar, who's racing to build buildings & infrastructure ahead of the 2022 FIFA World Cup) as well as the Klang Valley MRT domestically for structural steel works for stations. It remains a preferred structural steel specialist for international contractors & we like the potential of it moving into O&G sector via its investment in Technics. Trading at just 6.1x FY12/13 -  Buy TP RM1.41 (PE 7.5x FY12/14)
 
Calls for APRIL Week 4/ May Week 1
STOCK
Initiation Dates
Initiation price
BUY/SELL
TARGET PRICE
LAST PRICE
% Change since Initiated
MUHIBAH(5703)
26/4/2013
RM1.12
ACCUMULATE
RM1.60
RM1.10
-1.8%
MAYBULK(5077)
26/4/2013
RM1.53
BUY on weakness
RM1.80
RM1.48
-3.3%
TENAGA(5347)
29/4/2013
RM7.83
TRIM
RM7.30
RM7.78
-0.5%
SPSETIA(8664)
29/4/2013
RM3.30
ACCUMULATE
RM4.40
RM3.50
+6.0%
PETGAS(6033)
30/4/2013
RM19.64
Sell into strength
RM18.50
RM18.56
+5.8%
PCHEM(5183)
30/4/2013
RM6.49
Sell into strength
RM6.00
RM6.48
-0.1%
WTK(4243)
02/5/2013
RM0.975
BUY
RM1.20
RM0.955
-2.0%
MPHB(3859)
02/5/2013
RM3.52
BUY
RM4.20
RM3.46
-1.7%
MISC(3816)
3/5/2013
RM4.30
BUY
RM4.97
RM4.32
+0.5%
PETDAG(5681)
3/5/2013
RM23.52
Trading SELL
RM20.00
RM23.20
-1.3%

 
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