Monday, November 10, 2014

Market Roundup | 7 October 2014


FBMKLCI   1824.19   -7.79pts   (-0.43%)     Volume  2.522b   Value 1.954b
 
1) The KLCI closed at day’s low paring earlier gains after hitting a high of 1841 (+9.42pts) as key heavyweights led by PCHEM  and SIME saw selling pressure at close. In the regional market, bourses were lacklustre despite a stronger DOW overnight as ASX+0.78%, Nikkei +0.55% were offset by HSI-0.42% and STI-0.14%. as investors trade cautiously ahead of key US employment data tonight. In the local scene, Construction-1.16% fared worse paced by loses in GAMUDA-3% and IJM-1.7% as investors took opportunity to lock in profit following recent rally. Market breadth was marginally positive today as the gainers edged decliners by 409 : 392. Futures closed at 1825 (1points premium)
 
2) Heavyweights : PCHEM-3.6% RM5.89, SIME-1.2% RM9.60, PBBANK-0.55% RM18.24, GENTING-1.25% RM9.46, SKPETRO-1.9% RM3.08, AXIATA-0.43% RM6.96, BAT+3.8% RM68.00, MISC+1.8% RM7.38
 
3) DBT : K1 45mil @ RM 0.37 (12% PUC, 28.8% discount), BJAUTO 39.1mil @ RM3.20 (4.8% PUC, 8% discount), MAYBANK 22mil @ RM9.73, MEGB 9.846mil @ RM0.60 (2.4% PUC)
 
4) Situational:-
MEGB -1.6% RM0.61: Masterskill Education Group Bhd has announced the disposal of its assets in a move to become an asset-light company. Major shareholder Siva Kumar Jeyapalan has offered to buy back four properties for RM75.0m, while another four non-core properties will be put up for sale. This move will see the company reducing its gearing to zero. An independent valuer, principal and independent advisers will be appointed for the proposed corporate exercise, said MEGB.
 
5) SUPERMX
 
3QFY14   Tover-20% RM748.75m   Net-22% RM80.7m  Eps  11.93sen   DPS  5sen
 
          Core net profit of RM86.6m is 69% of Consensus (f) RM125m
 
YoY, 3Q revenue was 2.2% lower mainly due to marginally lower gloves sold as a result of automation program in the current quarter. PBT was RM32.4mil -20% mainly due to this quarter recording a RM5.9mil realised and unrealised FOREX losses.  9M revenue was -20% lower mainly due to fire incident at Alor Gajah plant.
 
QoQ, Revenue was up 16.9% to RM278mil as its plant in Alor Gajah had fully recovered its production capacity. However PBT was only +0.4% due to FOREX losses and stocking up cost relating  to new factories and for the resumption of Alor Gajah plant.
 
Going forward, Latex and nitrile prices is expected to remain at current levels. Company’s earnings will be supported by the recovery of its Alor Gajah plant as well as full commission of its production lines in Lot 6059 and 6058 that will see nitrile production capacity reach 12.3b pieces p.a. or 52% of the total installed capacity. SUPERMX trades at 10.5x FY15 PER compared to peers of mid teens . Accumulate.
 
6) Market: likely to continue consolidation pattern with first support at 1820pts level. Upcoming earnings season to dictate market direction.