Morning Call | 8 May 2013

FLOWS

Wednesday, 8 May, 2013

BUY

MAYBANK, PCHEM, AXIATA

SELL

BJTOTO, AMMB, DRBHICOM

STOCK ALERT

STOCK NAME

DATE

PRICE

BUY/SELL

TARGET PRICE

ARMADA(5210)

8/5/2013

RM3.98

ACCUMULATE

RM4.40

laggard in recent o&g run up as stk has been consolidating slightly below RM4. Technically MACD is still oversold and looking to cut up, RSI 58-still not overstretched.  Stk has been trading within a tight range this yr despite earlier award of RM2.3bn FPSO contract from ONGC, India. Anticipation is high that co will continue to secure another 1-2 FPSO charter contracts for the Belud (Msia) and Madura (Indo) fields. With recent newsflow on OSV players, Armada lags in terms of performance but co is positioning itself for deepwaters in Brazil, Africa and Msia as it is expanding in this segment from recent purchase of 4 MPSVs which yield higher rates. Another possible rerating catalyst for stk is Shell’s EOR contract which is expected to be awarded in June’13 which Armada is frontrunner. Trades at discount 21x to mkt leader SKPetro PER’13 31x. (LJN)

MRCB(1651)

8/5/2013

RM1.63

Trading BUY

RM2.00

one of the worst performing quasi GLCs, despite recovering from recent low of RM1.21. Technically this laggard has just broken out yesterday as it spiked above RM1.60 lvl as it plays catch up to other situational stks (It finally broken above LT 200D SMA lvl). Immediate rerating catalyst will be the upcoming EGM to approve recent proposed Nusa Gapurna acquisition will be held in June. This will enhance MRCB’s depleting landbank with 4 parcels of prime land in Klang Valley worth RM459m includes a new proj called PJ Sentral (diversify from KL Sentral which is due to complete in 2014). Limited downside as shr swap deal is at RM1.55 providing base case for stk. Also, just received LoI from GOvt to upgrade Klang Valley’s double tracking system for RM850m. In addition, more Govt initiatives eg RRI land and Jln Bangsar land will further boost its orderbook. (LJN)

Calls for APRIL Week 4/ May Week 1

STOCK

Initiation Dates

Initiation price

BUY/SELL

TARGET PRICE

LAST PRICE

% Change since Initiated

PETGAS(6033)

30/4/2013

RM19.64

Sell into strength

RM18.50

RM20.12

+2.4%

PCHEM(5183)

30/4/2013

RM6.49

Sell into strength

RM6.00

RM6.58

+1.3%

WTK(4243)

02/5/2013

RM0.975

BUY

RM1.20

RM1.02

+4.6%

MPHB(3859)

02/5/2013

RM3.52

BUY

RM4.20

RM3.71

+5.3%

MISC(3816)

3/5/2013

RM4.30

BUY

RM4.97

RM4.60

+6.9%

PETDAG(5681)

3/5/2013

RM23.52

Trading SELL

RM20.00

RM24.40

+3.7%

TAMBUN(5191)

6/5/2013

RM0.94

ACCUMULATE

RM1.12

RM1.06

+12.7%

SENDAI(5205)

6/5/2013

RM1.07

BUY

RM1.41

RM1.22

+14%

RHBCAP(1066)

7/5/2013

RM8.65

BUY

RM10.00

RM8.74

+1.1%

GLOMAC(5020)

7/5/2013

RM1.01

BUY

RM1.16

RM1.04

+3.0%