Thursday, January 29, 2015

Malaysia Daily, Maybank KE (2015-01-29)


Daily
29 January 2015
MARKET STRATEGY
MY Strategy: Maintain Neutral
Roadshow feedback
  • Quite a number of foreign investors we met have sold out.
  • Re-entry point when crude oil price, MYR volatilities ease.
  • Still defensive, our strategy; no change to targets.
COMPANY UPDATE
Yinson Holdings: Maintain Buy
More on Ghana FPSO job win
  • Can command EBITDA/EBIT margins of 80%/50% respectively.
  • This job alone could double Groups current earnings once it operates fully in 2018.
  • Reiterate BUY and MYR4.35 SOP-TP.
Yinson Hldngs: Maintain Buy
Secures Ghana FPSO job
  • A 15+5 year charter worth USD3.3b (ex-cost escalation).
  • To contribute MYR110m-MYR170m p.a. profit from 2017.
  • TP raised by 44% to MYR4.35 (SOP-based), offers 50% upside.
Sime Darby: Maintain Buy
A step closer on NBPOL takeover  Shariah-compliant
  • The EU Commission has granted the necessary clearance for Simes proposed acquisition of NBPOL (NBPO LN).
  • Post-acquisition, we expect Sime to seek more greenfield land from the PNG government for future expansion there.
  • Maintain BUY with an unchanged TP of MYR10.70 on 18x 2016 PER.
KLCC Property: Maintain Buy
Visible pipeline of assets
  • Clear pipeline of assets in place for the next 4-5 years.
  • Maintain earnings forecasts, DCF-based TP of MYR7.65.
  • We like KLCCP for its earnings defensiveness, strong back-up by its parent, PETRONAS and superior asset quality. BUY.
RESULTS REVIEW
Sunway REIT: Maintain Hold
Within expectation
  • 1HFY6/15 core net profit of MYR126m (+7.7% YoY) in line.
  • Raise FY15-17 net profit forecasts by 1.6-5.1% to include recently-acquired Sunway Georgetown Hotel, Wisma Sunway.
  • Maintain HOLD with a higher DCF-based TP of MYR1.50 (from MYR1.36).
ECONOMICS
BNM Monetary Policy
No change in OPR
  • OPR stays at 3.25%.
  • Tone of the Monetary Policy Statement (MPS) is "neutral" as the Malaysian economy is seen on steady growth path and inflation is expected to rise slower than earlier expected.
  • We expect OPR to remain at 3.25% throughout 2015.
Technicals
A weaker index tone may emerge

The FBMKLCI declined 7.29 points to 1,795.88 yesterday, while the FBMEMAS and FBM100 also closed lower by 39.00 points and 38.77 points, respectively. We recommend a
Take Profit stance for the index.

Trading idea is a Take profit call on PENERGY with downside target areas at MYR1.34 & MYR0.80.
Click here for full report »
Other Local News
AMMB: Shake up at the top. A major shake up at the top level of AmBank Group is on the cards as the banking industry braces itself for a tough 2015. Sources said the banking arm of AMMB Holdings will soon see the departure of its group MD Ashok Ramamurthy, MD for wholesale banking coverage Pushpa Rajadurai, and AmInvestment Bank MD/CEO for wholesale banking products Kok Tuck Chong. Some of the changes will likely be announced as early as end of this week, sources said. (Source: The Edge Financial Daily)

AirAsia X: Plans rights issue funding as management shakeup looms. It is set to announce a rights issue of shares as early as Friday to try and close a growing cash-flow gap, according to sources. The sources did not say how much AirAsia X was targeting to raise from the rights issue but said the airline was also examining other funding options. They declined to be named because the matter was not public yet. (Source: The Star)

Mitrajaya: Secures MYR230m public housing project in Putrajaya. It comprises 1,062 units, in Precint 5, Putrajaya. The contract is for 36 months and is expected to be completed by February 2018. The contract is expected to contribute positively to its earning, said Mitrajaya. (Source: The Star)

Tanjung Offshore: Suspends 3 officials for possible breaches of fiduciary, procedure, authority. The move was taken based on the recommendation of an independent committee following an in ternal inquiry, the company said in a statement. According to Tanjung, Tan Sri Tan Kean Soon and Muhammad Sabri Ab Ghani have been suspended from their executive functions and roles with immediate effect, but remained as directors of the company. Also, Datuk Harzani Azmi
s services as a paid advisor to the company has also been suspended with immediate effect. (Source: Business Times, The Edge Financial Daily)

Tune Ins Holdings: Appoints new CEO. It has appointed Junior Namjick Cho as its new CEO, effective on Jan 27, 2015. Prior to his appointment, Cho 43, was chief executive adviser of AirAsia Zest between January 2013 and October 2014. (Source: The Edge Financial Daily)
Outside Malaysia
U.S: Fed raises economy assessment while staying patient on rates. The Federal Reserve boosted its assessment of the economy and downplayed low inflation while repeating a pledge to stay "patient" on raising interest rates. The Federal Open Market Committee described the expansion as "solid," an improvement over the "moderate" performance it saw in December. It substituted "strong" for "solid" in its evaluation of job gains. The central bank acknowledged that inflation has declined further below its long-run objective of 2%, attributing it to the impact of lower crude oil price. In addition, Fed added international developments as factors that will determined on how long to maintain the interest rate at current level. We are maintaining our view that Fed will raise the fed fund rats moderately by 50-75bps beginning late 3Q 2015. (Sources: Bloomberg, Maybank KE)

Russia: Retail sales jump as shoppers offload tumbling Ruble. Russian retail sales surged the most in more than two years as consumers enduring the country's worst currency crisis since 1998 accelerated purchases to mitigate the effect of a sinking ruble. December sales jumped 5.3% YoY, quicker than November
s 1.8% YoY advance, the Federal Statistics Service said. Wages adjusted for inflation fell 4.7% YoY. (Source: Bloomberg)

Japan: Retail sales unexpectedly slump in challenge to Abe. Japanese retail sales unexpectedly fell in December, underscoring challenges to Prime Minister Shinzo Abe's effort to stoke a recovery in the world's third-biggest economy. Sales slid 0.3% MoM from November for a third straight monthly decline, the trade ministry said. (Source: Bloomberg)

Australia: Core consumer prices accelerated last quarter, easing pressure on the central bank to reduce interest rates and sending the local currency higher. The trimmed mean gauge of core prices rose 0.7% from the previous quarter, when it climbed a revised 0.3%, the Bureau of Statistics said. (Source: Bloomberg)
   
Key Indices
Value
YTD (%)
Daily (%)
KLCI
1,795.9
(3.8)
(0.4)
JCI
5,268.9
23.3
(0.2)
STI
3,419.2
7.9
0.2
SET
1,592.8
22.6
0.2
HSI
24,861.8
6.7
0.2
KOSPI
1,961.6
(2.5)
0.5
TWSE
9,510.9
10.4
(0.1)




DJIA
17,191.4
3.7
(1.1)
S&P
2,002.2
8.3
(1.3)
FTSE
6,825.9
1.1
0.2




MYR/USD
3.620
10.5
0.6
CPO (1mth)
2,221.0
(15.5)
1.5
Crude Oil (1mth)
44.5
(54.8)
(3.9)
Gold
1,288.6
7.2
0.7












TOP STOCK PICKS



Buy rated large caps

Price
Target
Axiata

7.14
7.60
Tenaga Nasional

14.80
16.00
Sime Darby

9.55
10.20
Genting Malaysia

4.10
4.60
Gamuda

5.07
6.00
AirAsia

2.77
3.00
Westport

3.52
3.60
SP Setia

3.56
3.98
AFG

4.78
5.50
Hartalega

7.55
8.50










1 comment:

  1. Tanjung Offshore Bhd is the victim here..Tan Sri Tan Kean Soon may be the main culprit that caused the loss in business..
    http://www.thestar.com.my/Business/Business-News/2015/01/29/Tanjung-suspends-3-key-officials-Move-comes-on-recommendation-by-its-newlyset-up-independent-committ/?style=biz

    ReplyDelete

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