FBMKLCI
1831.98 -7.31pts (-0.40%)
Volume 2.873b Value 2.520b
1) The KLCI continue to erase last week's gain despite
the stronger US market which rallied after the Republican won control of the
Senate and improving jobs numbers. In the regional market, bourses were mixed
despite the rebound in oil prices today as the NIKKEI -0.86% and HSI -0.20%
both closed marginally lower while SHCOMP +0.27% closed just slightly higher
after the Chinese Government approved of more investment spending to bolster
growth. In the local scene, TRADING & SERVICES -0.56% index lost the most
grounds today weighed by TENAGA after the tariff hike was delayed, other losers
amongst the sector was AXIATA -1.13%, GENTING -0.72%, PETDAG -1.10%. Market
breadth was negative today as the losers outpaced gainers by 436 : 364. Futures
closed at 1835.5 (3.5points premium)
2) Heavyweights : TENAGA -3.26% RM13.02, AXIATA -1.13%
RM6.99, BAT -3.47% RM65.50, CIMB -0.93% RM6.35, GENTING -0.72% RM9.60, PBBANK
+0.43% RM18.34, SIME +0.41% RM9.72, GENM +0.71% RM4.21.
3) DBT : MEGB 30mil @ RM 0.60 (7.319% PUC), IDMENSN 5mil
@ RM0.103, YSPSAH 3.4mil @ RM1.47 (2.55% PUC)
4) Situational:-
MITRA -1.98%
RM0.99 - Mitrajaya Holdings Bhd has won a RM401.9m construction job from
Sunrise Pioneer Sdn Bhd, a member of UEM Sunrise Group. The group said the
award, bagged by its unit Pembinaan Mitrajaya Sdn Bhd is for the proposed
execution and completion of two blocks of a condominium (MK22) at Mont Kiara,
Kuala Lumpur. It said the contract is expected to be completed by Aug 2, 2017
and to contribute positively to the group's earnings.
5) PCHEM
9 Mths Tover -10%
RM10,696m Net -27% RM1,964m EPS 25 sen
21% below cons(f) RM3,323m
Against the corresponding period, the Group recorded
lower plant utilisation by 5% at 77% on the back of higher level of gas supply
limitations and statutory turnaround activities. Lower methane gas availability
from upstream supplier affected the Group’s methanol production, particularly
in the first and third quarter of the period. Statutory turnarounds were also
more intensive in the period with activities at the Group’s smaller cracker and
related downstream facility, MTBE plant, Bintulu urea plant and smaller
methanol facility, as well as planned maintenance at the aromatics plant. The
corresponding period saw statutory turnaround activities at the PDH plant as
well as at the main cracker and related downstream facilities. Consequently,
production and sales volumes were lower.
Average realised prices for the period was slightly lower
with mixed movements amongst the products. Polymer and methanol prices
strengthened whilst ethylene glycols, aromatics and fertiliser prices softened.
As a result of lower volumes and prices, Group revenue
declined by 10% or RM1.2 billion at RM10.7 billion. Subsequently, PAT for the
period decreased by 28% or RM851 million at RM2.2 billion mainly due to
narrower spreads particularly for ethylene glycols, derivatives and aromatics
and lower volumes of higher-margin ethane based products. EBITDA also decreased
by 24% or RM1,062 million to RM3,302 million.
Management expect Q4 to improve following completion of
turnaround & maintenance activities and feedstock reliability to improve in
1Q2016 when sources of supply from another new field is expected to be
available via a new pipeline.
Trading at prospective PER of 13.3x, PChem is fairly
priced. The current market weakness is an opportunity to position into the
stock for the seasonally attractive year end/January window.
6) Market: likely to continue to correct/consolidate
after its strong gains in the 2nd half of October.