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FLOWS
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Tuesday, 8 July, 2014
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BUY
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WCT,
SKPETRO, TENAGA
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SELL
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MAXIS, GAMUDA, AXIATA
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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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ECONBHD (5253)
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8/7/2014
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RM0.765
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BUY
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RM1.00
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Stock has total outstanding shares of 535m and 90m shares
(16.8%) were offered to investors via public issue of 30.5m shares &
private placement to identified investors of 59.5m shares at an IPO price of
RM0.54. It was recently listed on 30/6/14 and in total 433.9m shares have
been traded since then. Econpile shares saw very strong demand during the
private placement exercise and the public issue was oversubscribed by 35.4x.
Given the volume traded since its listing, it is very likely that all the
stags have been fully absorbed and the shares are now in strong hands. With a
small free float, we expect Econpile to outperform on any positive news.
Econpile is one of the pioneers & leaders in the local piling industry
(market share of 13%), hence is expected to garner its fair share of the
piling contracts in the current construction boom. Piling & foundation
works, on an average is 10% of the project cost. Independent research
estimated that the piling & foundation works will grow at a CAGR of 9%
between 2013 & 2018. Econpile has an order book of RM498m (1.3x FY6/13
revenue) and is tendering for RM2.0b worth of contracts. It is one of the few
construction companies that has a dividend policy of minimum20% payout of net
profit. Valuation is attractive at prospective FY6/15 PER of 11.8x. Buy
(LJN/PT)
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GUH (3247)
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8/7/2014
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RM1.39
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BUY
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RM1.55
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One of the principal activities of GUH is the manufacturing
of double-sided & multi-layered printed circuit boards (PCB) which
operates from Penang & Suzhou in China. Its PCB division saw a PBT growth
of 43.4% in 1Q14 despite a seasonally slowest quarter in the global
technology sector. This is not unlike the other listed tech stocks profit
performance. Yet GUH remains unnoticed and a laggard compared to its peers in
terms of price performance, hence an opportunity to buy the stock. GUH’s
relative new water & waste water division which gained traction in FY13,
also offers promising prospects. In FY13, the division secured 3 projects
with total contract value of RM39.1m in Malaysia. As at end 1Q14, it has
unbilled sales of RM40m and is currently tendering for RM170m worth of
projects. GUH also has a strong balance sheet with net cash of RM195.2m at
1Q14 which translates into RM0.74/share. GUH is currently trading at PER
ex-cash of 7.1x for FY15, and is trading at 24% discount to its NTA of
RM1.83/share. Buy
(LJN/PT)
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Calls for JUNE WEEK 3/ 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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TDM (2054)
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1/7/2014
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RM1.04
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ACCUMULATE
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RM1.20
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RM1.05
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+0.9%
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MHB (5186)
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1/7/2014
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RM3.72
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BUY
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RM4.10
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RM3.81
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+2.4%
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MUDAJYA (5085)
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2/7/2014
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RM2.51
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BUY
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RM2.85
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RM2.62
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+4.3%
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TAS (5149)
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2/7/2014
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RM1.50
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ACCUMULATE
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RM1.70
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RM1.54
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+2.6%
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SONA (5241)
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3/7/2014
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RM0.485
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Trading BUY
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RM0.60
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RM0.485
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0.0%
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CYPARK (5184)
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3/7/2014
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RM2.81
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ACCUMULATE
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RM3.20
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RM2.86
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+1.7%
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GOB (1147)
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4/7/2014
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RM1.03
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Trading BUY
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RM1.40
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RM1.02
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-1.0%
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WPRTS (5246)
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4/7/2014
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RM2.72
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ACCUMULATE
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RM3.12
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RM2.70
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-0.8%
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KPJ (5878)
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7/7/2014
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RM3.63
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SELL
into strength
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-
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RM3.61
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-0.6%
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TURBO (5167)
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7/7/2014
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RM1.35
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ACCUMULATE
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RM1.60
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RM1.35
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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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