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FLOWS
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Tuesday, 10 June, 2014
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BUY
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UEMS,
SPSETIA, IOICORP
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SELL
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SKPETRO, GENTING,
DIGI
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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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YTL (4677)
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10/6/2014
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RM1.63
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BUY
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RM2.40
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Share price tanked ~8% following its removal from the list of Shariah-compliant
stocks. The weakness found in the current share price may present a very good
buying opportunity as the fundamental for the stock is still intact. As
comparison, YTL Power experienced a similar predicament six months ago and
its share price recovered after a comparable drop. YTL's fundamentals are
arguably better than YTL Power's because of the additional earnings catalysts
from the cement division and the Express Rail Link extension to KLIA2. Going
forward, construction is poised to be a new powerful earnings catalyst for
YTL, kicking off with the recent Track 4A IPP award to a consortium led by
YTL Power. YTL should benefit from the construction of the RM6bn project, and
its orderbook could swell further with the possible RM8bn Express Rail Link
(ERL) extension to Melaka and the RM30bn high speed rail (HSR) project to
Singapore. Currently trading at 10.3x FY15 P/E, YTL's valuations are the
cheapest among the conglomerates in the region. Buy with a TP of
RM2.40 based on a 20% discount to RNAV.
(KL)
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SUPERMX(7106)
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10/6/2014
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RM2.33
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BUY
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RM2.90
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Share price has retreated ~24% since reaching a high of RM3.08 in
December. As it has been consolidating at this level for about a month
following the decline, it is believe that investors have already priced in
its foreseeable risks. Although the group’s 1QFY14 earnings were weak, the
result was expected as the group's operations were affected by the temporary
stop in production due to the fire at its Alor Gajah plant in 4QFY13. Looking
ahead, earnings growth is not a concern because 50% of the production lines
impacted by the fire are now up and running since mid-Jan 2014 while the
remaining production lines were re-commissioned in various stages in 2Q14. In
addition, potential insurance claims from the damages and loss of revenue
could be reflected in subsequent quarters. Currently, Supermax is trading at
only 10x CY15 EPS, a 25% discount to the sector average. Given the attractive
valuation and the intact fundamentals, advocate Buy with a TP of
RM2.90 based on 12.4x P/E (30% discount to Hartalega's P/E).
(KL)
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Calls for JUNE WEEK 1/WEEK 2 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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DAYA (0091)
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3/6/2014
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RM0.315
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ACCUMULATE
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RM0.44
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RM0.32
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+1.5%
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SURIA (6521)
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3/6/2014
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RM2.61
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ACCUMULATE
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RM3.20
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RM2.84
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+8.8%
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PADINI (7052)
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4/6/2014
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RM1.94
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BUY on weakness
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RM2.20
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RM1.92
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-1.1%
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GADANG (9261)
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4/6/2014
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RM1.69
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Trading BUY
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RM2.20
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RM1.69
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0.0%
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NCB (5509)
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5/6/2014
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RM3.00
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Trading BUY
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RM3.55
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RM3.00
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0.0%
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IJM-WC (3336WC)
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5/6/2014
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RM2.79
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BUY
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RM3.30
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RM2.77
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-0.8%
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TALAMT (2259)
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6/6/2014
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RM0.09
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Trading BUY
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RM0.16
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RM0.10
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+11.1%
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SNTORIA (5213)
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6/6/2014
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RM0.895
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BUY
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RM1.20
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RM0.895
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0.0%
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SUCCESS (7207)
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9/6/2014
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RM1.48
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BUY
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RM2.00
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RM1.47
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-0.7%
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WEIDA (7111)
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9/6/2014
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RM1.60
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ACCUMULATE
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RM2.00
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RM1.60
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0.0%
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Performance
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Positive
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Negative
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Neutral
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