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FLOWS
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Tuesday, 6 May, 2014
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BUY
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UEMS,
YTL, IOICORP
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SELL
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AXIATA, SIME, PETGAS
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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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PTARAS (9598)
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6/5/2014
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RM3.81
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ACCUMULATE
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RM4.30
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The forthcoming listing of Econpile, another piling
specialist although with lower profit margins, will throw the spotlight
on PTaras which is the best in the trade with average PBT margin of c.
24% vs its peers of <8% for FYs 2011 & 2012. For the y/e June'13,
PTaras achieved a PBT margin of 30%. The company is able to outperform due to
the following reasons: 1) it has a full range of piling machines, tools &
accessories which reduces the need to outsource & provides easier
scheduling thus reducing downtime; 2) its in-depth knowledge of ground
conditions of most parts of Malaysia (accumulated from numerous jobs done
over 2 decades) allows for informed decision-making to pick & choose the
best jobs to bid; and 3) ability to procure inputs at a discount to
prevailing market prices because of its size & financial standing (net
cash of 69sen/share + market value of investments by external fund managers
of 29sen/share as at 31/12/13). The industry is also in a sweet spot with the
numbers of large-scale infrastructure projects & the proliferation of
high rise developments that will keep them busy & boost piling rates from
shortage of piling capacity. PTaras trades at an attractive forward FY6/15
PER of 10.2x. Accumulate
(LJN/PT)
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GOB (1147)
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6/5/2014
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RM0.965
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BUY
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RM0.965
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Stock has retraced 21% in the last 2 weeks from the
contagion of the ACE market correction and is close to the 76.4% retracement
of the run from RM0.86 to RM1.22. GOB is a beneficiary of the opening of the
Penang Second Bridge with its 350 acres of land in Batu Kawan with long-term
growth prospects on Penang’s mainland. This parcel of land is neighbour to a
proposed golf course & theme park land, and is near to the exit of the
Penang Second Bridge & the Batu Kawan Industrial Park, hence creating
demand for residential properties in GOB’s land with potential GDV of RM2.3b.
The recent launch of its property development project, Callisia 2, has been
fully taken up with more phases slated for next year. The latest transaction
prices of parcels of land in Batu Kawan ranges from RM45-55psf. Assuming the
lower end at RM45 psf, the 350-acre landbank is worth RM686m, i.e. >3x
GOB’s existing market cap of RM219m. Its other developments are its
flagship Taman Equine with a remaining 80 acres (estimated GDV RM900m) to be
completed over the next 2 years, and its JV with Lembaga Getah Malaysia to
develop a mixed development project with a GDV of RM800m along Jalan Ampang.
GOB is undervalued, trading at 66% discount to its RNAV of RM2.87. Buy
(LJN/PT)
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Calls for APRIL Week 4/MAY week 1 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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IOIGP (5249)
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28/4/2014
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RM2.69
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BUY
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RM3.40
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RM2.65
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-1.5%
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IGB (1597)
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28/4/2014
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RM2.75
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ACCUMULATE
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RM3.20
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RM2.73
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-0.8%
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GAMUDA (5398)
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29/4/2014
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RM4.55
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BUY
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RM5.45
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RM4.56
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+0.2%
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SUNWAY (5211)
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29/4/2014
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RM3.15
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BUY
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RM3.50
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RM3.08
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-2.3%
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MISC (3816)
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30/4/2014
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RM6.39
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BUY
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RM7.10
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RM6.47
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+1.2%
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SEALINK (5145)
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30/4/2014
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RM0.465
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BUY
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RM0.57
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RM0.445
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-4.4%
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HARTA (5168)
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2/5/2014
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RM6.34
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ACCUMULATE
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RM7.40
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RM6.16
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-2.9%
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UMW (4588)
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2/5/2014
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RM10.76
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ACCUMULATE
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RM12.00
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RM10.70
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-0.6%
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THHEAVY (7206)
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5/5/2014
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RM0.90
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Trading BUY
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RM1.20
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RM0.89
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-1.2%
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HOHUP (5169)
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5/5/2014
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RM1.60
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BUY
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RM2.30
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RM1.52
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-5.0%
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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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