Malaysia Daily, Maybank KE (2014-03-27)

Daily 27 March 2014 COMPANY UPDATE Glomac: Maintain Hold To pick up pace in 2H14  Shariah-compliant Looking to expand its landbank aggressively especially for township development. Property launches will pick up pace in 2HCY14; most launches will be affordable landed properties. Maintain HOLD on unchanged earnings forecasts and MYR1.20 TP (0.6x P/RNAV). Click here for full report » Telekom Malaysia: Maintain Hold Acquiring Packet One (P1)?  Shariah-compliant TM and Green Packet (parent of P1) have requested for a trading suspension today pending a material announcement. If this relates to the acquisition of P1, pricing and TM's longer term wireless intentions would be key points to note. Maintain HOLD (TP: MYR5.90) for now as we await further details. Click here for full report » Kimlun Corporation: Maintain Buy More MRT jobs from Singapore  Shariah-compliant Won its maiden SGD21m (MYR53m) precast package for the new Thomson Line in Singapore. Earnings visibility is high with its record high jobs in-hand. Maintain BUY with TP of MYR1.90 (10x FY14 PER). Click here for full report » Technicals Obvious 1Q14 window dressing The FBMKLCI rose 1.97 points to close at 1,839.14 yesterday, while the FBMEMAS and FBM100 also closed higher by 18.63 points and 15.32 points, respectively. We recommend a �Buy on Dips� stance for the index. Trading idea is a Short-Term Buy on KFIMA with upside target areas at MYR2.50 & MYR2.64. Stop loss is at MYR2.10 Click here for full report » Other Local News TH Heavy: Lifting load-up capacity at yard. TH Heavy Engineering Bhd is upgrading its fabrication yard to achieve a fourfold increase in load-up capacity to 8,000 tonnes by the third quarter of this year.The upgrade is expected to push the yard�s current annual capacity above 20,000 tonnes, depending on the evaluation done by Petroliam Nasional Bhd (Petronas). TH Heavy�s fabrication yard on Pulau Indah, which is also the only such facility in the Klang Valley, completed the first phase of modernisation last year, which allowed it to undertake major offshore and onshore fabrication works. It is also in the early stages of diversifying its services into the Floating Production Storage and Offloading (FPSO) system. TH Heavy is bidding for a contract by an international O&G player that, if materialised, would mark its first venture into the FPSO segment, likely in the first half of this year. (Source: Business Times) Tan Chong: New Nissan X-Gear from ETCM. Edaran Tan Chong Motor (ETCM) has unveiled the latest face-lifted model of the Nissan X-Gear which is available in only one option � the 1.6 litre automatic. The five-seater X-Gear is a crossover between a multi-purpose vehicle and a sport-utility vehicle and is priced at RM89,800 on-the-road with insurance with a warranty period of three years or 100,000km (whichever comes first). ETCM is looking at a sales target of 1,500 to 2,000 units a year for the X-Gear. (Source: The Star) IPO: Azman and Hamid propose MBO of Symphony's existing business. Symphony House Bhd has entered into a heads of agreement with Ranhill Energy and Resources Bhd to facilitate the listing of the latter in a reverse takeover exercise (RTO). Symphony would acquire all the equity interest in Ranhill Group Sdn Bhd including its subsidiaries from Ranhill in return for new Symphony shares. Another salient point from the agreement is that Tan Sri Mohamed Azman Yahya who is the current acting chairman and group chief executive officer of Symphony and executive director Abdul Hamid Sheikh Mohamed would buy out the existing business of the company for MYR60m in a management buyout (MBO) exercise. The shares will be consolidated and issued at MYR1.50. The consolidation is in the ratio of 10 existing shares of 10 sen each to be consolidated into one share of MYR1. No value was given to the proposed exercise as due diligence on the assets to be injected into Symphony is only expected to be completed in about two months� time. (Source: The Star) Property: Iskandar hub for data centre. Iskandar Malaysia has been earmarked for the establishment of a second hub for data centre parks in the country under the Entry Point Project 3 (EPP3) of the Economic Transformation Programme (ETP). Under the EPP3, Malaysia aims to achieve MYR786m in revenue in 2014, MYR7b in private investments and MYR2.46b gross national income contribution by 2020 respectively. At least half of 23 data centre service providers currently in the Klang Valley region were keen to expand their services to Iskandar Malaysia. (Source: The Star) Outside Malaysia U.S: Capital-goods orders signal slower investment. American factories received fewer orders for machinery, communications gear and computers in February, signaling business investment is slowing after an unusually harsh winter put a damper on sales. Bookings for non-military capital goods excluding aircraft fell 1.3% after a 0.8% gain in January that was smaller than initially reported. The category, which is part of the durable goods report, is considered a proxy for the corporate-spending prospects. (Source: Bloomberg) Indonesia: Seeks Rupiah to help exports, tight policy bias. Bank Indonesia aims to keep monetary policy on a "tight bias" and favors an exchange rate that supports exporters, according to Senior Deputy Governor Mirza Adityaswara. "We are still in a period where we need to reduce the current-account deficit," so a rupiah level that's supportive of exports and reduces unnecessary imports is more suitable, he said in an interview in Hong Kong. The authority will let markets determine the currency's onshore and offshore rates, Adityaswara said. (Source: Bloomberg) Australia: RBA's Stevens sees encouraging signs of domestic handover from mining-led demand growth to domestic consumption and the nation's economy may strengthen later this year. "This outlook is, obviously, a balance between the large negative force of declining mining investment and, working the other way, the likely pick up in some other areas of demand helped by very low interest rates," Stevens said in the text of a speech in Hong Kong. "The lower exchange rate since last April and the improved economic conditions overseas also help." (Source: Bloomberg)     Key Indices Value YTD (%) Daily (%) KLCI 1,839.1 (1.5) 0.1 JCI 4,728.2 10.6 0.5 STI 3,143.3 (0.8) 1.3 SET 1,360.4 4.8 0.5 HSI 21,887.8 (6.1) 0.7 KOSPI 1,964.3 (2.3) 1.2 TWSE 8,737.3 1.5 0.6 DJIA 16,269.0 (1.9) (0.6) S&P 1,852.6 0.2 (0.7) FTSE 6,605.3 (2.1) 0.0 MYR/USD 3.3 0.7 (0.2) CPO (1mth) 2,770.0 5.4 (1.0) Crude Oil (1mth) 100.3 1.9 1.1 Gold 1,304.5 8.6 (0.5) TOP STOCK PICKS Buy rated large caps Price Target Tenaga 11.96 14.00 Genting Msia 4.20 4.74 HLBK 14.18 16.40 AMMB Holdings 7.18 8.50 Bumi Armada 3.89 5.00 IJM Corp 6.11 6.75 Time dotCom 3.81 4.40 MPHB Capital 1.82 2.42 Cahya Mata Swak 9.74 10.50