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FLOWS
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Monday, 5 August, 2013
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BUY
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GENTING, TM, PERDANA
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SELL
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TENAGA, SIME, AXIATA
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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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KPJ(5878)
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5/8/2013
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RM6.67
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ACCUMULATE
on weakness
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RM7.25
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The share price has retraced c10% from the RM7.40 level after it was
announced that Group had to pay RM70.6m for breach of an agreement signed in
May 1996. Selling pressure was further fueled by earnings dilution concerns
from its recent rights issue & free warrants, and potential cut in
dividends from litigation losses. We believe the selldown provides a lower
entry point into KPJ. On the positive side, the rights issue is expected to
raise RM123m, which will be used to finance part of its expansion plan &
to pare down borrowings. KPJ's net gearing is expected to fall from 0.45x to
0.36x. Bonus issue will also improve trading liquidity in the share while the
warrant could potentially raise RM380m and could help to finance KPJ's future
capacity expansion. Management is also in the process of filing an appeal (potential
compensation) & even should it lose the appeal, the legal liability is
one-off in nature. Trading at c26x FY14 - Accumulate on weakness (TP RM7.25
based on 28x FY14).
(AK)
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MYEG(RM1.88)
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5/8/2013
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RM5.37
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ACCUMULATE
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RM2.20
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Share price has fallen c14% over the past 2
weeks (or a 50% retracement of its latest run-up) after the recent surge in
interest in mid-July which saw prices hitting RM2.20. With the retracement,
valuation stands at 25x & 17x for FY06/14 &15, which still appears stretched
(vs FBM small cap historical PE of 10x), but the group's longer term
prospects remain intact. This is underpinned by its newly launched services,
namely the online Foreign Workers Permit Renewal (FWPR) & upcoming
Customs Services Tax Monitoring (CSTM). News-flow / new developments suggest
management is not resting on its laurels but is striving to move up the
ladder chain, with a multitude of new services & projects in the
pipeline. Group is also expected to be one of the major beneficiaries when the
government implement the GST system in the near future - Accumulate. (TP
RM2.20, PER 20x FY06/15).
(AK)
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Calls for JULY Week 4 /
AUGUST 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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MAHSING (8583)
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29/7/2013
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RM2.51
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ACCUMULATE
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RM3.10
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RM2.40
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-4.4%
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QL(7084)
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29/7/2013
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RM3.60
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Trading SELL
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RM3.30
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RM3.48
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-3.3%
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GADANG (9261)
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30/7/2013
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RM0.92
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BUY
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RM1.20
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RM0.93
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+1.0%
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PERISAI(0047)
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30/7/2013
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RM1.56
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ACCUMULATE
on weakness
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RM2.00
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RM1.55
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-0.7%
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SENDAI (5205)
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31/7/2013
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RM1.56
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Trading BUY
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RM1.75
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RM1.57
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-0.6%
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TEBRAU (1589)
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31/7/2013
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RM1.36
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Trading BUY
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RM1.70
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RM1.33
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-2.3%
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KIMLUN (5171)
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1/8/2013
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RM2.00
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ACCUMULATE
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RM2.60
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RM2.08
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+4.0%
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DELEUM (5132)
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1/8/2013
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RM3.28
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BUY
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RM3.90
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RM3.65
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+11.2%
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UEMS (5148)
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2/8/2013
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RM2.70
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BUY
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RM3.15
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RM2.73
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+1.1%
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MISC(3816)
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2/8/2013
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RM5.37
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BUY
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RM5.80
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RM5.29
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-1.5%
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We’ve added
an extra feature (first column from right) to indicate our recommendation for
our call.
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HOLD
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CONT SELL
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SELL/ TAKE PROFIT
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CONT BUY
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STRONG BUY
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