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FLOWS
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Wednesday, 22 January, 2014
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BUY
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IOIPROP,
GAMUDA, ASTRO
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SELL
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CIMB, AXIATA, MISC
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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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DIALOG (7277)
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22/1/2014
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RM3.32
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ACCUMULATE
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RM3.60
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Stock has retraced about 8% since 31/12/13 and is trading near to
initial support at RM3.30 level. Dialog has continued to execute on its core
business with its 3rd tank terminal project at Pengerang, where
Phase 1A is substantially completed & well on track to start operations
in 1QCY14. This deep-water petroleum terminal will underpin Dialog’s long-term
profitability. Dialog’s management has reiterated that the Pengerang terminal
project is independent of Petronas’ RAPID project and was planned 1 year
before the conception of RAPID, and it will proceed regardless of Petronas’
decision on RAPID which is expected to be by1QCY14. However, we are of the
opinion that RAPID, being an important part of the government’s 12 National
Key Economic Areas, and the daily advertisements taken by Petronas
citing RAPID as one of their landmark projects over various major news
networks, coupled with RAPID is expected to take the lead in producing Euro 4
& Euro 5 standards petrol & diesel, are key giveaways that the
project will be approved and be a huge catalyst for Dialog. In addition,
Dialog has recently signed a MOU with Concord Energy to conduct a feasibility
study (which will take approximately 1 year) for a proposed dedicated crude
oil and petroleum product storage terminal In Pengerang. These are all
potential sizeable jobs for its EPCC division which will add to the secured
jobs on subsequent phases of Pengerang terminal and provide earnings
feasibility for easily the next 5 years. Over a mid-time frame of 2-3 years,
Dialog has a potential re-rating catalyst which analysts have not build into
their forecasts currently. These are their ventures in the upstream O&G
development, i.e. the 50:50 EOR JV with Halliburton Energy Services Inc. to
redevelop the matured Bayan oilfield off-Sarawak and its Balai marginal field
Risk Sharing Contract (RSC) with Petronas which has already hit first-oil
& is awaiting final investment decision. Accumulate on weakness in view
of the current weak market.
(PT)
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TIMECOM(5031)
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22/1/2014
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RM3.56
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BUY
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RM3.90
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Stock has been consolidating around the RM3.50 – 3.60 band after
falling sharply from the RM4.00 level towards the end of last year. It is
also close to its major August’13 support of RM3.50. The Group has announced
plans for regional expansion via M&A by first gaining a foothold in Thailand
and eventually to Indonesia, Vietnam, Singapore and Philippines to fully
utilise the APG’s capacity by tapping into regional bandwidth demand from
Thailand and Indo-China. To recap, TimeCom is estimated to have a 6% stake in
the APG submarine cable which connects Malaysia directly to Korea and Japan.
With that stake, TimeCom is estimated to have an initial capacity of about
3.4Tbps for sale upon APG’s completion by end-2014. Also, Trading at only a
PER of 13.3x for FY14, which is relatively cheap compared to its peers of
19.8x, has a strong balance sheet with RM250m net cash. Start accumulation on
growth potential of bandwidth demand as increasing smartphone penetration
drives demand for content & data revenue at the expense of voice &
sms revenue in the telecommunication industry.
(PT)
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Calls for JAN week 2/Week 3 2014
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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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GAMUDA (5398)
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13/1/2013
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RM4.52
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ACCUMULATE
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RM4.90
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RM4.33
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-4.3%
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IOICORP (1961)
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13/1/2013
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RM4.24
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ACCUMULATE
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RM4.80
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RM4.20
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-1.0%
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UZMA (7250)
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15/1/2014
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RM5.75
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Trading Sell
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RM5.31
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RM5.69
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-1.1%
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WCT (9679)
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15/1/2014
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RM2.20
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ACCUMULATE
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RM4.80
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RM2.10
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-4.6%
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MEDIA (4502)
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16/1/2014
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RM2.57
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Trading BUY
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RM2.90
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RM2.44
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-0.4%
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LAFMSIA (3794)
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16/1/2014
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RM7.90
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Technical BUY
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RM9.00
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RM8.48
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+7.3%
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PUNCAK (6807)
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20/1/2014
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RM3.10
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ACCUMULATE
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RM3.80
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RM3.01
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-3.0%
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FAVCO (7229)
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20/1/2014
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RM3.25
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ACCUMULATE
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RM3.75
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RM3.36
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+3.3%
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BSTEAD (2771)
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21/1/2014
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RM5.34
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ACCUMULATE
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RM6.00
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RM5.35
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+0.1%
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SIME (4197)
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21/1/2014
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RM9.12
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ACCUMULATE
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RM10.00
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RM9.13
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+0.1%
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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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