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FLOWS
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Wednesday, 23 October, 2013
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BUY
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AXIATA, MHB, ARMADA, SUNWAY
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SELL
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TENAGA, AIRASIA
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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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MAXIS (6012)
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23/10/2013
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RM7.21
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TAKE PROFIT
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RM6.70
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Maxis (RM7.21) – with the stock overbought and its technical
indicators flashing signs of negative divergence against its price, we are
advocating to take profit into strength as it approaches its multi-year
resistance level of Rm7.30. Maxis is relatively expensive and it trades at a
significant premium valuation compared to market, and against its Malaysian
& regional peers despite limited earnings growth due to the saturation
mobile penetration rate coupled with a very competitive environment with
minimum opportunity for product differentiation. It trades at prospective PER
of 25.2x compared to market PER of 16.9x, and Malaysian ®ional
telecommunication sector average prospective PER of 22.1x & 14.1x
respectively. Maxis’ market consensus 12-month target price is only at RM6.64
– 8% downside from current price. Take profit
(PT)
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KULIM (2003)
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23/10/2013
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RM3.27
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ACCUMULATE
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RM3.80
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Kulim (RM3.27) – has a track record of outperformance in
the last quarter of the year with an average gain of 27% for the last 3
years. This is not surprising as Kulim has Johor Corp (60%), KWAP (7.5%)
& EPF (5.2%) as major shareholders. For the past 2-3 weeks, there were
signs of accumulation with the stock trading between RM3.25 – 3.30, and
subsequent Bursa filings disclose that KWAP & EPF have been buying Kulim
around the current level. The announcements also showed that Johor Corp has
exercised 3.5m of warrants when the warrants were trading at a premium of 16%
in the market, i.e. at an indicative all-in price (warrant price + exercise
price of RM3.13) of RM3.80. These major shareholders buying & exercise of
warrants at premium normally indicates that the shares are undervalued. Kulim trades at FY14 PER of 18.2x and p/bk of
1.08x versus its peers’ average FY14 PER of 18.8x and p/bk 1.95x. The
benchmark CPO price has gained by 8.3% since it bottomed at the end of
September while Kulim price has retraced 1.5% over the same period. Other
plantation stocks like TSR, KLK, FGV, Sime & GENP have already crept up
in line with higher CPO prices. Accumulate
(PT)
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Calls for OCT Week 2/ Week 3
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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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YTL (4677)
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16/10/2013
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RM1.52
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ACCUMULATE
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RM1.80
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RM1.61
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+5.9%
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SCOMIES(7045)
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16/10/2013
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RM0.67
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ACCUMULATE
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RM0.80
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RM0.73
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+8.9%
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MALTON (6181)
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17/10/2013
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RM0.97
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Trading BUY
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RM1.20
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RM0.985
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+1.5%
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SENDAI (5205)
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17/10/2013
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RM1.42
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ACCUMULATE
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RM1.80
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RM1.45
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+2.1%
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NAIM (5073)
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18/10/2013
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RM3.75
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ACCUMULATE
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RM5.12
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RM3.80
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+1.3%
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OLDTOWN (5201)
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18/10/2013
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RM2.48
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Trading BUY
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RM2.88
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RM2.6
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+3.2%
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UEMS (5148)
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21/10/2013
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RM2.51
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ACCUMULATE
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RM3.22
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RM2.59
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+3.1%
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MRCB (1651)
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21/10/2013
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RM1.46
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ACCUMULATE
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RM1.70
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RM1.46
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0.0%
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WEIDA (7111)
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22/10/2013
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RM1.74
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BUY
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RM2.45
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RM1.75
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+0.5%
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WCT(9679)
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22/10/2013
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RM2.45
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BUY
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RM3.08
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RM2.42
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-1.3%
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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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