Malaysia Daily, Maybank KE (2014-07-30)

Daily 30 July 2014 RESULTS PREVIEW Regional Plantations: Maintain Neutral 2Q14 Results Preview 2Q14 plantation profits will be stronger YoY boosted by strong FFB output and higher CPO ASP. Bumitama, TSH, AALI and GENP posted strongest YoY FFB output growth in 2Q14; slower growth by FGV, THP and FR. Sector NEUTRAL maintained, lacks short-term catalysts. Click here for full report » COMPANY UPDATE UMW Holdings : Maintain Buy Rationalising non-core M&E assets  Shariah-compliant UMWH�s disposal of non-core M&E assets in India is positive, in line with its strategy to streamline its core operations. No change to our earnings from this development; potential upside from stronger-than-expected Toyota vehicle sales. Reiterate BUY with an unchanged MYR12.44 SOTP-based TP. Click here for full report » Technicals Selling on last-minute rallies is wise The FBM KLCI rebounded 4.37 points WoW to close at 1,877.34, as some very late last-minute nibbling activities led the index up after the index spent most of last Thursday and Friday under heavy initial selling. With the selling that emerged from 1,896.23, we advise clients to sell at the resistance areas of 1,877 to 1,896. The support levels of 1,860 and 1,867 will see very weak nibbling activities. Trading idea is a Take profit call on AMBANK with downside target areas at MYR6.66 & MYR6.45. Click here for full report » Other Local News Auto: Demand for CKD hybrid cars. Sales of locally-assembled hybrid cars are expected to be brisk this year as demand for such vehicles are still strong. Malaysian Automotive Institute chief executive officer Madani Sahari said sales of hybrid vehicles in the country this year will be led by the locally assembled or completely-knocked-down (CKD) Honda Jazz and Mercedes S-Class. He said Mercedes Benz began production of their S-Class hybrid in April this year but production units until 2015 have been completely sold out. (Source: The Star) Zelan: To win MYR250m ECER job. Zelan is expected to bag a MYR250m contract from the East Coast Economic Region (ECER) for the construction and completion of a drawbridge connecting Muara North and Muara South in Kuala Terengganu. Zelan is partnering Hasrat Sedaya Sdn Bhd, an engineering company specializing in bridge construction. They have a 70% and a 30% equity interest in the joint venture respectively. (Source: The Edge Financial Daily) Aeon Credit: Mulls rewarding shareholders. Non-bank financial institution Aeon Credit Service may consider making a bonus issue which will help to improve the stock's liquidity said its newly-appointed managing director Kenji Fujita. He said the issue was raised in the last annual general meeting but they have not arrived at any such decision at this point. The last time Aeon Credit gave bonus shares to its shareholders was in June 2008, with a one-for-one bonus issue for 175.5m new shares. (Source: The Edge Financial Daily) Berjaya Food: BStarbucks to grow BFood earnings by 40%-50% y-o-y. Berjaya Food Bhd�s (BFood) acquisition of the remaining 50% stake it does not own in Berjaya Starbucks Coffee Co Sdn Bhd (BStarbucks) is expected to grow the group�s earnings by 40% to 50% year-on-year (y-o-y) in the financial year ending April 30, 2015 (FY15) from its net profit of MYR23m in FY14. This will translate into a targeted net profit of MYR32m to MYR35m said the group�s chief executive officer Francis Lee. Furthermore, BFood targets to open 20 to 25 more Starbucks outlets in Malaysia in FY15. (Source: The Edge Financial Daily) Titijaya: Eyes more projects. Property developer Titijaya Land is mulling over development projects on two parcels of land in the Klang Valley to beef up its already large gross development value (GDV). Sources said that Titijaya was in the process of submitting a proposal to KTMB Bhd to build a massive commercial building on the piece of land that is located between the Subang Jaya Komuter station and Shah Alam. It is believed that there is an option for the building to be KTMB's new headquarters. The other parcel that Titijaya is targeting is located in the popular spot in Ampang near Mah Sing Group Bhd's M City project. The land, measuring less than 4.05ha, is near the Ampang-Kuala Lumpur Elevated Highway. Sources said the high-rise mixed development had a GDV of some MYR1b. (Source: The Star) Outside Malaysia U.S: Residential real-estate prices rose in the 12 months ended May at the slowest pace in more than a year as a lull in the U.S. housing market limits appreciation. The S&P/Case-Shiller index of property values in 20 cities increased 9.3% from May 2013, the smallest year-to-year advance since February 2013, after rising 10.8% in the year ended in April, the group said. Compared with the prior month, prices dropped for the first time in two years. (Source: Bloomberg) U.S: Consumer confidence soared in July to an almost seven-year high as increased employment opportunities led to brighter views of the U.S. economy. The Conference Board's index advanced to 90.9, the highest since October 2007, from 86.4 in June, the New York-based private research group said. (Source: Bloomberg) U.K: Mortgage approvals rose more than economists forecast in June to a four-month high, suggesting the housing market resumed some momentum. Approvals rose to 67,196 from an upwardly revised 62,007 in May, the Bank of England said. (Source: Bloomberg) Japan: Retail sales fell more than forecast in June, capping a weak quarter that challenges Prime Minister Shinzo Abe's bid to reflate the economy while heaping a heavier tax burden on consumers. Sales dropped 0.6% from a year earlier, the trade ministry said. In the second quarter, sales slumped 7% from the previous three months. (Source: Bloomberg)