Malaysia Daily, Maybank KE (2014-09-29)

Daily 29 September 2014 COMPANY UPDATE Genting Malaysia: Maintain Buy Our chips are all in! Poor 2Q14 results was an anomaly, from our understanding. Trim earnings estimates by 4-6% nonetheless. GENM looks set to win an upstate NY commercial casino license, in our view. Value accretion at least MYR0.47/sh. Upgrade to BUY and raise TP 10% to MYR5.15. New TP assumes GENM will win an upstate NY license. Click here for full report » RESULTS REVIEW Yinson Holdings: Maintain Buy New FPSO win a major catalyst 1HFY1/15 results are tracking 12M expectations. Securing one new FPSO job for 2014 is a major catalyst. MYR3.03 TP under review pending outcome of Ghana's tender, due soon. We are positive and maintain our BUY call. Click here for full report » ECONOMICS Singapore IPI, August 2014 On an upward momentum Industrial production growth in Aug 2014 picked up further to +4.2% YoY (revised Jul 2014: +3.0% YoY). Electronics and Biomedical output led the gains. Jul-Aug 2014 trend is positive for 3Q 2014 GDP after it slowed to 2.4% YoY in 2Q 2014 from 4.8% YoY in 1Q 2014. Click here for full report » Malaysia Budget 2015 Preview Sustaining progress on fiscal consolidation Budget 2015 on 10 Oct 2014 to stay focused on fiscal consolidation, especially with the rollout of GST on 1 Apr 2015. Other possible key measures include announcements on the review of fuel subsidy mechanism; Government debt management measures; incentives for Islamic banking/capital market; higher development fund allocation for Sarawak and several railway infrastructure projects; people-oriented measures to deal with cost of living issues. The "usual suspects" like hikes in sin and gaming taxes as well as further property-cooling measures are unlikely. Click here for full report » Technicals Global indices remain much weaker The FBM KLCI fell 8.99 points WoW to close at 1,840.50, as consistent selling activities led the index down since last Monday. We advise clients to sell at the resistance areas of 1,840 to 1,896. The support levels of 1,802 and 1,829 will see much weaker buying activities. Trading idea is a Take profit call on PRESBHD with downside target areas at MYR1.86 & MYR1.79. Click here for full report » Other Local News Banking: BSN targets MYR3b savings from Premium Savings Certificate. Bank Simpanan Nasional (BSN) has targeted to accumulate MYR3b in savings from the Premium Savings Certificate (SSP) scheme by the year-end. Its head of Islamic banking department, Damanhuri Mahmood, said that until September this year, the amount of savings generated through the syariah-compliant SSP nationwide was MYR2.6b. He said Selangor, Kuala Lumpur and Johor registered the highest number of SSP depositors while Kelantan had 147,000 depositors with savings worth MYR146m. (Source: The Star) Property: Emkay to build affordable houses worth MYR1.3b. The Emkay Group, owned by Tan Sri Mustapha Kamal Abu Bakar, is developing affordable houses worth MYR1.3b in Selangor to suit the needs of the middle-and low-income group. First out of the blocks, the company is building 960 units apartments, which has a gross development value of MYR347m, known as MasReca-19 at Block 19. Mustapha Kamal said the project is the first phase of the development and it is slated to be completed by third quarter 2017. (Source: Business Times) Oil & Gas: Petronas signs MoUs with Pemex, YPF. Petroliam Nasional Bhd (Petronas) has signed two MoUs with the Mexican national oil company, Petr�leos Mexicanos (Pemex) and Argentinian national oil company, YPF, extending its aspirations for growth in the Americas. Both Petronas and Pemex have also signed a tripartite MoU with YPF, which was represented by its chief executive officer Miguel Galuccio. The MoU covers the sharing of experiences and best practices related to exploration and production of oil and gas. (Source: The Star) Ekovest:To launch projects worth MYR4b. Builder and property developer Ekovest Bhd, controlled by tycoon Tan Sri Lim Kang Hoo and Datuk Haris Onn Hussein plans to launch five projects with combined gross development value (GDV) of over MYR4b over the next 10 years. Included in this development is EkoTitiwangsa, EkoQuay, EkoGateway, EkoPark Place, EkoAvenue and its ongoing EkoCheras which is a mixed retail and residential development. (Source: The Edge Financial Daily) Outside Malaysia U.S: Consumer sentiment rose in September to 14-month high. The Thomson Reuters/University of Michigan final index of sentiment increased to 84.6, the same as the preliminary reading, from 82.5 in August. Employment growth at the strongest pace in 15 years is helping brighten moods, while cheaper prices at the gas pump are making it easier on household budgets. Faster wage increases and more broad-based improvement in employment would help provide an additional boost for sentiment and spark bigger gains in the consumer purchases that make up about 70% of the economy. (Source: Bloomberg) India: S&P raises outlook in boost for Modi as Rupee surges. India's credit rating outlook was raised to stable from negative by Standard & Poor's, removing the risk of a downgrade to junk status for Prime Minister Narendra Modi as the U.S. weighs when to boost interest rates. The rupee surged the most in six weeks. The company maintained its BBB- rating on Asia's third-largest economy, the lowest investment grade, and said it could raise the rating if economic growth quickens and fiscal, external or inflation metrics improve. S&P had lowered the outlook to negative in April 2012 on diminishing growth prospects. (Source: Bloomberg)     Key Indices Value YTD (%) Daily (%) KLCI 1,840.5 (1.4) (0.1) JCI 5,132.6 20.1 (1.3) STI 3,292.2 3.9 0.0 SET 1,600.2 23.2 0.5 HSI 23,678.4 1.6 (0.4) KOSPI 2,031.6 1.0 (0.1) TWSE 8,989.8 4.4 (0.2) DJIA 17,113.2 3.2 1.0 S&P 1,982.9 7.3 0.9 FTSE 6,649.4 (1.5) 0.1 MYR/USD 3.3 (0.5) 0.2 CPO (1mth) 2,189.0 (16.7) (0.7) Crude Oil (1mth) 93.5 (5.0) 1.1 Gold 1,218.4 1.4 (0.3) TOP STOCK PICKS Buy rated large caps Price Target Tenaga 12.28 14.00 Axiata 6.98 7.60 Sime Darby 9.19 10.20 Gamuda 4.82 5.30 UMW O&G 3.90 5.15 AFG 5.00 5.50 Perdana Petroleum 1.82 2.55 Hock Seng Lee 1.87 2.25