Malaysia Daily, Maybank KE (2014-03-18)

Daily 18 March 2014 SECTOR UPDATE Banking Sector: Maintain Neutral Mudarabah: Deposit or investment? Latest EDs could raise operating costs for Islamic banks. But we expect a muted impact ( Impact on BIMB's pretax profit (estd -4%) could be less than earlier estimated. Maintain HOLD for now. Click here for full report » RESULTS REVIEW Berjaya Sports Toto: Maintain Hold Results in-line, waiting for catalysts 9MFY4/14 results within expectations. 9.5sen third interim share DPS a pleasant surprise. Maintain HOLD with a trimmed TP (-1%) of MYR3.95. Click here for full report » Technicals Back to trading the ranges The FBMKLCI rose 10.04 points to close at 1,815.16 yesterday, while the FBMEMAS and FBM100 closed higher by 58.52 points and 61.44 points, respectively. In terms of market breadth, the gainer-to-loser ratio was 300-to-434, while 336 counters were unchanged. A total of 1.27b shares were traded valued at MYR1.52b. Click here for full report » Other Local News Oil & Gas: Oil found offshore Sabah at Limbayong-2 well, says Petronas. Oil has been discovered offshore Sabah at the Limbayong-2 well with 136 metres of oil bearing sands. Discovery on Monday was made during appraisal of Limbayong gas field by Shell. The consortium of Shell Malaysia (35%), Conoco Phillips (35%) and Petronas Carigali Sdn Bhd (30%) were involved in the drilling of the Limbayong-2 appraisal well. (Source: The Star Online) Property: Perfect Eagle eyes golf land. Perfect Eagle Development S/B, a privately held property developer - known for its flagship O2 City mixed-development project in Puchong, Selangor - is proposing to buy 279 acres of land in Sungai Buloh, Selangor, on which Kelab Rahman Putra Malaysia sits, for MYR296m cash. (Source: The Edge Financial Daily) KEuro: To start work on WCE in 2Q14. Kumpulan Europlus Bhd (KEuro) will commence construction of the West Coast Expressway (WCE) in 2Q14. The highway will take 5 years to complete with toll collection to commence in 2018. (Source: The Edge Financial Daily) AZRB: Expects MYR750m revenue for 2014. Ahmad Zaki Resources Bhd (AZRB) is expecting MYR700m-MYR750m in revenue this year, driven by its construction division. (Source: The Edge Financial Daily) Maica: Mulls fundraising. Malaysia Aica Bhd (Maica) has confirmed that it is currently considering a potential fundraising exercise for the company. (Source: Bursa announcement) Outside Malaysia U.S: Factory output in February rises most in six month. The 0.8% MoM gain exceeded the highest estimate in a Bloomberg survey and followed a revised 0.9% MoM slump in January. The pickup contrasts with the housing industry, where another report showed builder sentiment rose less than forecast in March. Assembly lines churned out more cars, business equipment and chemicals a month after snowstorms hampered deliveries of parts and materials. The data point to an expansion that will keep improving as temperatures warm, one reason why Fed policy makers this week will probably stick to their strategy of reducing the pace of monthly bond purchases. (Source: Bloomberg) E.U: Euro-area inflation unexpectedly slowed in February, keeping pressure on the European Central Bank to defend the currency bloc against falling prices. Consumer prices rose an annual 0.7% YoY, down from 0.8% YoY in January, the European Union's statistics office said. The rate has been below 1% for five months. (Source: Bloomberg) Vietnam: Cut its key policy rates, as the government tries to support businesses and bolster a struggling economy. The discount rate will be cut to 4.5% from 5%, and the repurchase rate will be lowered to 5% from 5.5%, the central bank's monetary policy head Nguyen Thi Hong said. The refinancing rate will be reduced to 6.5% from 7%. (Source: Bloomberg)     Key Indices Value YTD (%) Daily (%) KLCI 1,815.2 (2.8) 0.6 JCI 4,876.2 14.1 (0.1) STI 3,092.1 (2.4) 0.6 SET 1,377.1 6.0 0.4 HSI 21,474.0 (7.9) (0.3) KOSPI 1,927.5 (4.2) 0.4 TWSE 8,700.1 1.0 0.1 DJIA 16,247.2 (2.0) 1.1 S&P 1,858.8 0.6 1.0 FTSE 6,568.4 (2.7) 0.6 MYR/USD 3.3 (0.0) 0.0 CPO (1mth) 2,829.0 7.6 (0.4) Crude Oil (1mth) 98.1 (0.3) (0.8) Gold 1,380.6 14.8 0.7 TOP STOCK PICKS Buy rated large caps Price Target Tenaga 12.00 14.00 Genting Msia 4.13 4.74 HLBK 14.20 16.40 AMMB Holdings 6.99 8.50 Bumi Armada 3.88 5.00 IJM Corp 5.97 6.75 Time dotCom 3.82 4.40 MPHB Capital 1.83 2.42

Definition of Ratings Maybank Investment Bank Research uses the following rating system: BUY Total return is expected to be above 10% in the next 12 months, HOLD Total return is expected to be between -10% to 10% in the next 12 months, SELL Total return is expected to be below -10% in the next 12 months. Applicability of Ratings The respective analyst maintains a coverage universe of stocks, the list of which may be adjusted according to needs. Investment ratings are only applicable to the stocks which form part of the coverage universe. Reports on companies which are not part of the coverage do not carry investment ratings as we do not actively follow developments in these companies.

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