FBMKLCI 1861.82 -0.49%
(-0.03%) Volume 3.291b
Value 2.119b
1) The KLCI rose
in the earlier session following the stronger US market overnight but retraced
to close just flat before the release of US consumer confidence data tonight.
In the regional market, bourses were generally negative as the HSI -0.37%
retreated from its 6 year high; while the SHCOMP -0.98% closed lower weighed by
a small cap sell off today which triggered concerns. In the local scene,
CONSTRUCTION index grew by +0.87% in the last hour of trade boosted by GAMUDA
+2.88%, GBGAQRS +8.80%, EKOVEST +2.32%. Market breadth was positive today as
gainers beat losers by 435 : 382. Futures closed at 1863.5 (2points premium)
2) Heavyweights : IOICORP +1.50% RM4.73, MISC +1.31%
RM6.94, SKPETRO +0.70% RN4.30, KLK +0.54% RM22.22, GENTING -0.93% RM9.56,
MAYBANK -0.39% RM10.04, PCHEM -0.78% RM6.35, PPB -1.07% RM14.74.
3) DBT : BJCORP 165.51mil @ RM0.50 (3.84% PUC), MARCO
10.5mil @ RM0.249 (18.5% premium), CRESBLD 3mil @ RM1.50 (1.818% PUC @ 5.1%
discount).
4) Situational:-
AMBANK +0.43% RM6.96 - AMMB Holdings Bhd has decided to
sell its entire stake in its wholly owned Singapore stockbroking company,
AmFraser Securities Pte Ltd, to KGI Asia (Holdings) Pte Ltd (KGI) for SGD38.0m
(RM96.2m) cash. Its wholly-owned Singapore-based subsidiary, AmFraser
International Pte Ltd (AmFIPL), has entered into a sale and purchase agreement
with a 100.0%- owned subsidiary of KGI Securities Co Ltd, a Taiwan-based
stockbroking company, for the proposed disposal of AmFraser. The purchase price
has taken into consideration a preliminary value for future recovery of overdue
receivables post completion and a value at a premium over the adjusted net
assets of AmFraser.
5) IJM Q1 06/14
Rev-2% RM1.373b Net-19% RM133.4m EPS 9.23s
Results trails
FY cons of RM659m
For 3 months yoy, revenue from Construction -32%, as
certain JV projects that contributed significantly to previous year have since
been completed. Revenue from Property +5%, driven mainly by strong sales
achieved and faster work progress. Revenue from Plantation +32% as current
quarter sales volume and CPO ASP increased by 15.2% and 14.9% respectively. PBT
from Construction +731% following higher margins being achieved at various
projects and a decrease in unrealized forex losses ( RM13m LY vs RM1.2m this
period). PBT from Property was marginally lower attrible to higher operating
expenses, advertising and promotional expenditure. PBT from Plantation surged
962% as a result of higher commodity prices ( RM2566/mt vs RM2234/mt last year).
Qoq, PBT was 13% lower due to gains on remeasurement of previously held stake
of RM223m of Radiant Pillar SB in preceding quarter & share of JV losses
arising from impairment of concession assets in Vijayawada Tollway Pte Ltd and
Lebuhraya Kajang-Seremban totaling RM176m in preceding quarter.
We still like IJM, as there is renewed order book
optimism as it's construction margins begin to normalise. Outstanding orders
are at a record RM5bil, including c.RM2.8bil already secured from West Coast
Expressway (WCE). Orderbook momentum should accelerate with several upcoming
tenders that include another RM2.2bil worth of jobs under WCE, Kuantan Port
expansion Phase 1 and the Four Seasons Hotel building works. The market is also
positive on the Proposed Privatisation for IJM Land. The higher premium for IJM
land shares can be compensated through greater operational efficiencies as well
as enhanced property development and property investment business of IJM Land
through easier availability of funding at cheaper rates. Furthermore, with an
outstanding land bank of over 5,800 acres and GDV of RM39bn, IJM Land's profit
is poised for more growth beyond FY17; Hold.
6) Market : Expect the market to further consolidate with
a downward bias. Key technical indicators are waning, suggesting that the local
benchmark could dip further in the short-term. Investors may look to buy into
weakness on selective blue-chips at the 1855 support level.