Thursday, February 27, 2014

Market Roundup | 26 February 2014

FBMKLCI   1822.55pts    -11.20pts   (-0.61%)   Volume  2.448b   Value 2.374b
 
1)  The KLCI was one of the losers amongst the Asian region today as the US market dipped overnight after data showed slower growth in U.S home prices and a drop in consumer confidence. In the regional market, bourses were generally mixed with SHCOMP+0.35% rebounding as the Yuan stabilized and money rate fell today; HSI +0.54% also gained as valuations of stocks reached undemanding levels. In the local scene, profit taking was seen all over the market whilst the CI closed at day low after selected heavyweights were hit down at the end of the session, namely CIMB -2.81%, YTL -1.86%, KLK -0.83%, YTLP -1.17%. Market breadth was negative with losers beating gainers by 558 : 291. Futures closed at 1826 (3.5pts premium).
 
2) Heavyweights: CIMB -2.81% RM6.90, IOICORP -3.59% RM4.56, SIME -1.30% RM9.10, MAYBANK -0.82% RM9.65, TENAGA -0.66% RM11.94, DIGI -1.165 RM5.09, YTL -1.86% RM1.58, GENTING -0.59% RM10.02
 
3) DBT: RPB 20mil @ RM 0.41 (2.33% PUC @ 7.9% discount), AMPROP 9.279mil @ RM0.90 (1.59% PUC), RCECAP 4.871mil @ RM0.295
 
4) Situational:-
KPS +4.44% RM1.88/ENGTEX +5.52% RM1.91/JAKS +10.78% RM0.56/PUNCAK 0.00% RM3.36/YLI +8.12% RM0.865 - The federal and Selangor governments have signed an MOU on the restructuring of the state's water supply industry which has dragged on for five years. Under the MoU, the state government will issue a development order for the construction of the Langat 2 Water Treatment Plant (Langat 2) and its distribution system (LRAL2) (Package 2A) effective today and ensure that all approvals and authorisations relating to the LRAL2 project approved within 30 days. In addition, the federal government is ready to inject additional funds to enable the state government to take over water concession companies and manage water supply in the state through a state-owned company.
 
5) FGV
 
FY13   Tover-2.5% RM12,568mil  Net+21.7% RM981mil   EPS  26.9sen
 
     Core RM488mil is 18.8% below FY consensus of RM601.5mil
 
Yoy, Plantation division PBT fell 48.3% to RM686.87mil due to lower      average selling price of RM2,333/MT from RM2,843/MT in 2012. FFB production was 5.05mil MT or 2.9% higher with FFB yield achieved at 19.59ton per hectare vs 19.12ton per hectare.
 
Sugar division increased 24.4% to RM388.78mil backed by higher volume and lower processing and purchasing cost of refined sugar. Gross Margin improved to 20.2% vs 16.3%.
 
Downstream saw losses widening from RM12.04mil to RM45.16mil. Manufacturing, Logistic segment fell 45.6% due to decrease in R&D income by 34.1% and lower fertilizer sales volume and margin.
 
QoQ: Operating profit achieved excluding LLA effect was RM354mil compared to RM119mil due to higher CPO  and FFB from its plantation division. While Sugar segment fell 31.8% due to fall in domestic sales by 15% after abolishment of sugar subsidy.
 
Hold. Currently trades at FY14 PE of 19.3x
 
6) Mkt: Cautious pattern to persist with profit taking in recent outperformers.