Malaysia Daily, Maybank KE (2015-04-10)

Daily 10 April 2015 COMPANY UPDATE Bursa Malaysia: Maintain Hold Holding out for a special Flattish 1Q15 earnings expected. We maintain our forecasts, expect another special dividend. Fairly valued, maintain HOLD. Click here for full report » Inari Amertron: Maintain Buy More Avago content in new devices  Shariah-compliant Samsung's Galaxy S6/S6 Edge teardown reveals an increase in Avago RF content compared to its predecessor, Galaxy S5. Catalysts are higher orders/new product outsourcing from Avago; the weaker MYR provides upside to our forecasts. Our earnings forecasts are unchanged for now. Reiterate BUY with an unchanged TP of MYR3.95, pegged to 16x CY16 PER. Click here for full report » Sunway: Maintain Hold Expanding trading divisions  Shariah-compliant Neutral on the latest acquisitions of two trading companies. Deals backed by profit guarantees of MYR15.7m p.a.. Fine-tune earnings by +0.5-1.7%. Maintain HOLD with a marginally raised MYR3.25 TP (+2sen, on 0.59x P/RNAV). Click here for full report » Technicals Consolidating ahead of the weekend The FBMKLCI inched down by 0.92 points to 1,849.39 yesterday, while the FBMEMAS and FBM100 closed higher by 5.14 points and 0.67 points, respectively. We recommend a �Nibble on Dips� stance for the index. Trading idea is a Short-Term Buy on EATECH with upside target areas at MYR0.715 & MYR0.76. Stop loss is at MYR0.55. Click here for full report » Other Local News Transportation: MYR9b LRT3 tender documents ready for collection. Prasarana Malaysia, the project owner of the Light Rail Transit Line 3 (LRT3) from Bandar Utama to Johan Setia in Klang covering 36km with 25 new stations have announced that tender documents for pre-qualified contractors bidding to be the project delivery partner are ready for collection. The contractors have until noon on June 9 to submit their proposals to Prasarana with construction scheduled to commence in 2016 and slated for completion by 2020. (Source: The Edge Financial Daily) Water: Puncak Niaga's MYR1.5b sale of water assets get fourth extension. Puncak Niaga Holdings said the proposed MYR1.5b disposal of its assets to Pengurusan Air Selangor Sdn Bhd (Air Selangor) has been extended for the fourth time by another month to May 11. Selangor Menteri Besar Mohamed Azmin Ali and Energy, Green Technology and Water Minister Datuk Seri Maximus Ongkili are to meet this week to discuss matters involving the master agreement signed between both governments in September last year. (Source: The Edge Financial Daily) KNM Group: Bags USD56.57m deals from Japanese, Spanish groups. KNM Group has secured three projects worth a combined USD56.57m from Japan's Toyo Group and Spanish-based Tecnidas Reunidas Group. The group has won the USD15.17m contracts from Tecnidas Reunidas Group to supply reactors, columns and pressure vessels for the Pengerang project, the USD7.97m contract to supply towers to Toyo Engineering Corp of Japan for Turkmengas Petrochemical Complex and another USD33.53m contract by Toyo Group to supply columns, reactors, drums and tanks for the Pengerang Integrated Petroleum Complex Project in Johor. (Source: The Edge Financial Daily) Bina Darulaman: Keen on Kulim airport project. Kedah-based property developer Bina Darulaman is keen on bidding for the construction of the proposed Kulim International Airport reported to cost some MYR1.6b. However, no bids for the project have been submitted as authorities are yet to finalize the terms of the proposed airport. The company also mentioned that it targets to launch three mixed-development projects in Jitra, Sungai Petani and Kuala Ketil this year, with a gross development value of MYR350m. (Source: The Edge Financial Daily) Outside Malaysia U.S: Jobless claims over past month lowest in 15 years. Fewer Americans applied for unemployment benefits over the past four weeks than at any time in almost 15 years, signaling underlying strength in the labor market even as hiring cooled last month. From mid-March through the seven days ended April 4, jobless claims averaged 282,250 a week, the lowest since June 2000, a Labor Department report showed. (Source: Bloomberg) Germany: Industrial production was bolstered by investment-goods output in February, highlighting improved confidence in the recovery in Europe's largest economy. Output, adjusted for seasonal swings, rose 0.2% after a revised 0.4% drop in January, a report from the Economy Ministry in Berlin showed. While investment- goods production surged 1.2%, a slump in construction damped output. (Source: Bloomberg) U.K: House prices rose in March as a strengthening economy and a boost to real wages spurred demand for property. The average cost of a home increased 0.4% from February, mortgage lender Halifax said. Prices gained 7.8% YoY to GBP 192,970 (USD 266,000), though Halifax said the pace may cool through this year. (Source: Bloomberg) India: Rating outlook raised by Moody's on growth prospects. India's credit rating outlook was raised to positive by Moody's Investors Service, signaling optimism in the efforts of Prime Minister Narendra Modi and central bank chief Raghuram Rajan to improve Asia's No. 3 economy. The country's Baa3 rating was affirmed and the outlook was revised from stable, Moody's said. India is rated the lowest investment grade, on par with Indonesia, Iceland and Turkey. (Source: Bloomberg) S. Korea: Central bank held its key interest rate at an all-time low to monitor the impact of three cuts since August as inflation slowed and exports fell. The Bank of Korea kept the seven-day repurchase rate unchanged at 1.75%, as forecast by all 16 economists surveyed by Bloomberg. The BOK is expected to keep it at that level until at least the end of March 2016, according to a separate survey. (Source: Bloomberg)     Key Indices Value YTD (%) Daily (%) KLCI 1,849.4 (0.9) (0.0) JCI 5,500.9 28.7 0.3 STI 3,460.3 9.2 (0.0) SET 1,545.1 19.0 0.0 HSI 26,944.4 15.6 2.7 KOSPI 2,058.9 2.4 (0.0) TWSE 9,568.0 11.1 (0.0) DJIA 17,958.7 8.3 0.3 S&P 2,091.2 13.1 0.4 FTSE 7,015.4 3.9 1.1 MYR/USD 3.632 10.9 0.0 CPO (1mth) 2,108.0 (19.8) (2.1) Crude Oil (1mth) 50.8 (48.4) 0.7 Gold 1,194.8 (0.6) (0.6) TOP STOCK PICKS Buy rated large caps Price Target Tenaga Nasional 14.56 16.00 Sime Darby 9.30 10.20 Genting Malaysia 4.41 4.60 Gamuda 5.18 6.00 Westport 4.01 4.50 SP Setia 3.46 4.07 AFG 4.77 5.30 Hartalega 8.35 8.50 Inari 3.42 3.95 MBM Resources 3.38 4.20 Vitrox 3.55 4.05