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FLOWS
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Thursday, 31 July, 2014
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BUY
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IOICORP,
AXIATA, SKPETRO
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SELL
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MAYBANK, DIGI, PCHEM
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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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BRAHIMS (9474)
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31/7/2014
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RM1.77
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ACCUMULATE
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RM2.00
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Stock price fell 13% in less than 3 weeks on contagion from
the MH17unfortunate accident to close near recent support levels of RM1.75 -
RM1.73, and is within the retracement band of 62%-76% which provides
attractive opportunity for re-positioning of this stock. Management has
guided that the impact from the earlier MH370 incident has not been
significant with number of meals produced by Brahim post-MH370 resilient at
average of c. 1m meals/month. Quarters ahead are expected to be stronger with
recent sign-up with Lufthansa & contribution of RM4m p.a. to kick-in from
2Q onwards, AAX’s long-haul strategy to grow by 40% in capacity in FY14,
resulting in higher demands for in-flight meals (which will also compensate
from lower traffic in MAS), contribution from KLIA2 to start in 2Q and
significant interest cost savings (from 2Q onwards) from the group’s
refinancing into Islamic loan, estimated at RM5m savings across 3 years.
Brahim trades at attractive valuation of PER 12.2x & 9.8x for FY15 &
FY16 respectively. It is also defensive as GLCs hold significant stakes in
the company. Accumulate
(PT)
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AIRASIA (5099)
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31/7/2014
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RM2.44
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BUY on weakness
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RM2.75
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Chart is bullish with the recent
take-out of resistance at RM2.40 – RM2.43 and weekly macd has proven to be
resilient to continue staying in the positive territory. Improving
fundamentals from lower jet fuel cost which has retraced c. 7% in 2
weeks from USD126.21/bbl to USD117.90/bbl currently (which is < 0.5% from
critical support of USD117.34/bbl with further significant downside if broken).
MYR, Indonesian rupiah & the Thai baht have also strengthen by
5.0%, 5.7% & 3.5% respectively versus the USD over the past 6
months. These will greatly assist to reduce the costs of AirAsia &
its associates when yields are sticky on the upside. Analysts have estimated
that a 10sen strengthening in the MYR vs USD will improve the
bottomline by 7%. AirAsia is also likely to gain market share at the
expanse of MAS in view of the MH370 & MH17 mishaps. AirAsia
trades at cheap valuation with forward PER of 8.9x & 7.3x for FY15 &
FY16 respectively. The second half of the year is seasonally significantly
better than the first half. Buy on
weakness
(PT)
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Calls for JULY WEEK 4 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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POS (4634)
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22/7/2014
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RM5.33
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TRIM
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-
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RM5.15
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-3.3%
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PERISAI (0047)
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22/7/2014
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RM1.50
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ACCUMULATE
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RM1.88
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RM1.54
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+2.6%
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NAIM (5073)
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23/7/2014
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RM4.05
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BUY
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RM4.50
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RM3.98
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-1.8%
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GAMUDA (5398)
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23/7/2014
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RM4.76
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BUY
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RM5.30
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RM4.80
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+0.8%
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GASMSIA (5209)
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24/7/2014
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RM3.36
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ACCUMULATE
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RM3.65
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RM3.39
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+0.8%
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AFG (2488)
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24/7/2014
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RM5.04
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ACCUMULATE
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RM5.50
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RM4.95
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-1.8%
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PDZ (6254)
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25/7/2014
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RM0.16
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Trading BUY
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RM0.20
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RM0.18
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+12.5%
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PETDAG (5681)
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25/7/2014
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RM19.22
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ACCUMULATE
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RM22.00
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RM18.94
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-1.5%
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TROP (5401)
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30/7/2014
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RM1.44
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ACCUMULATE
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RM1.94
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RM1.44
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0.0%
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MHB (5186)
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30/7/2014
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RM3.58
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ACCUMULATE
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RM4.10
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RM3.53
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-1.4%
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Performance
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Positive
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Negative
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Neutral
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