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FLOWS
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Tuesday, 10 December, 2013
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BUY
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SKPETRO,
TM, MAYBANK
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SELL
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AXIATA, IOICORP,
MEDIA
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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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KULIM (2003)
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10/12/2013
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RM3.58
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Trading BUY
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RM4.00
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Stock is an attractive trade for year-end window dressing
which is currently evident due to the followings: 1) Johor Corp, KWAP &
EPF control 73% of its shareholdings; 2) Kulim provided an average return of
12.4% for the month of December over the last 3 years; 3) Kulim is a laggard
amongst the bigger plantation players in Malaysia with a year to date
negative return of 9.8% versus its peers average returns of +9.6%; and 4) it
is in the current favourite plantation sector which has been neglected and
under owned by the foreign investors for the past year due to the depressing
CPO prices and the global underweighting of commodity & commodity-related
stocks. However, recently investors have been flocking into the plantation
sector again due to the improving fundamentals such as the biodiesel mandates
in Malaysia & Indonesia, the slower-than-expected FFB & CPO
production from tree stress & severe wet weather, coupled with the
plantation sector entering a seasonally low production period which have all
been supportive of higher CPO prices of which Kulim is a pure play after
having sold its fast food business. Kulim is currently trading at FY14 PER of
19.6x which is in line with big caps plantation stocks average FY14 PER of
20x, but is undervalued on a p/bk basis with its p/bk at 1.2x versus its
peers average of 2.4x. Trading buy
(PT)
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SEALINK (5145)
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10/12/2013
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RM0.40
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Trading BUY
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RM0.50
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Stock faced selling pressure recently due to its exclusion
from the Syariah List. We view this as a buying opportunity as the selling is
due to complying with technicalities and not due to deteriorating
fundamentals. We also not expecting the selling to be excessive as a perusal
of the top 30 shareholders listing revealed the absence of any major Islamic
funds holding sizeable positions in the stock. The last few days of trading
showed the selling to be well absorbed with yesterday’s trading particularly
impressive - volume increased substantially in a +2.6% day. Sealink’s
chartering of marine support vessels business is predominantly focused on the
offshore O&G industry. It has a young and diverse fleet of 40 vessels
that cater to a wide base of reputable clients. It is not surprising that
this division has been doing very well this year with both higher utilization
& charter rates. This division has also been boosted by the delivery of 2
state-of-the-art diesel-powered hybrid anchor handlers with DP-2 positioning
which will contribute handsomely to Q4’13 &FY14 profits. Its Achilles’
heel, the shipbuilding & repair division, which has been suffering losses
these last 2 years, is showing signs of improvement with the announcement of
contracts secured for the disposal of 3 vessels in Q4 and expectations of
further orders with the buoyant local O&G sector.. Sealink’s valuation is
highly attractive with a p/bk of 0.46x & FY14 PER of 5.9x compared to a
current favourite with similar business profile (although different offshore
assets), Coastal Contract, with p/bk of 1.7x & FY14 PER of 9.3x. Buy
(PT)
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Calls for DEC week 1/week 2
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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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SYSCORP (5173)
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3/12/2013
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RM0.435
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BUY
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RM0.65
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RM0.455
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+4.5%
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CMSB (2852)
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3/12/2013
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RM6.09
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Take Profit
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-
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RM6.24
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+2.4%
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SENDAI (5205)
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4/12/2013
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RM1.16
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ACCUMULATE
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RM1.60
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RM1.21
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+4.3%
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TROP (5401)
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4/12/2013
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RM1.36
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ACCUMULATE
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RM1.70
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RM1.36
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0.0%
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SUPERMX (7106)
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5/12/2013
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RM2.68
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BUY
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RM3.40
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RM2.70
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+0.7%
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UOADEV (5200)
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5/12/2013
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RM1.98
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BUY
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RM1.70
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RM2.00
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+1.0%
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IOICORP (1961)
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6/12/2013
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RM5.80
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Trading BUY
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RM6.20
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RM6.00
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+3.4%
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JTIASA (4383)
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6/12/2013
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RM2.22
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BUY
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RM2.90
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RM2.23
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+0.4%
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WCT (9679)
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9/12/2013
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RM2.24
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Trading BUY
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RM2.50
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RM2.25
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+0.4%
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WTK (4243)
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9/12/2013
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RM1.23
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Trading BUY
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RM1.50
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RM1.22
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-0.9%
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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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