Affin Daily Insight (LV) - 2 September 2014 - TA ANN / BANKING / CIMB / SIME / LAFARGE / SAKP / MAS / FGV / US OUTLOOK

Top Calls

Results Note - Ta Ann (BUY, maintain) - Good 1H14 performance On the back of higher revenue by 31% yoy to RM457.6m, Ta Ann registered 1H14 core net profit of RM58.6m. Timber and palm oil plantation divisions revenues grew by 18% and 60% yoy respectively to RM283.8m and RM173.8m. This was largely underpinned by: 1) higher timber products sales volume and ASP; 2) higher FFB and CPO production; and 3) higher ASP for CPO. However, we cut our FY14E EPS by 19% to account for the considerably weaker CPO prices (RM1,929/MT currently vs. average of RM2,539 in 2Q14) due to, among others, record high US soybean production, weak CPO export growth as production increased, and tighter credit availability in China. Meanwhile, we keep our FY15-16E EPS based on a CPO ASP assumption of RM2,850/MT pending review of the CPO price and demand outlook for the plantation sector. We maintain our SOP-derived target price of RM5.12 and BUY rating on Ta Ann.

Other Calls

Sector Update � Banking (NEUTRAL, maintain) - Repayments continue to weigh down loan growth

Results Note- CIMB (REDUCE, maintain) - Higher allowances hit 2QFY14, below expectations

Results Note -Sime Darby (ADD, maintain) - KPIs surpassed but challenges ahead

Results Note - Lafarge (REDUCE, maintain) - Results largely within expectations

Flash Note -Sapura Kencana (BUY, maintain) - Significant gas discovery and US$124m contracts wins

Flash Note - MAS (ADD, maintain) - Reviving MAS from its ashes

Flash Note- FGV (ADD, maintain) - VCO for Asian Plantations with 24,622 ha in Sarawak

Economy � US Outlook � Weekly Wrap (18 - 22 August 2014) - Are concerns of rate hikes lower after Yellen�s speech?

Morning News and Market summary