Malaysia Daily, Maybank KE (2015-06-18)

Daily 18 June 2015 RESULTS REVIEW Eco World Development: Upgraded to Buy Value emerges; U/G  Shariah-compliant 1HFY10/15 net profit of MYR14.9m was in line. Encouraging response to new launches; management keeps its MYR3b sales target for FY10/15. Maintain earnings forecasts and MYR1.95 RNAV-based TP but upgrade ECW to BUY given a potential total return of >30%. Click here for full report » Top Glove: Maintain Buy Higher efficiencies, new capacities  Shariah-compliant Strong 3QFY8/15 surpassed expectations. High margins and earnings growth could sustain on higher efficiencies and new capacities. Raise FY8/15-17 EPS by 6% and TP to MYR7.10 (+6%; 17x CY16 PER). Maintain BUY. Click here for full report » COMPANY UPDATE Gas Malaysia: Maintain Hold A lower norm  Shariah-compliant MYR1.58/mmBTU FY15 spread guidance is an increase from the current level (c.MYR1.10/mmBTU), but a drop from the previous base of MYR2.02/mmBTU. IBR potentially begins in Jan 2016, and could incorporate a pass-through mechanism while preserving spreads. FY15/16/17 earnings revised by +68%/-12%/-33%; TP lowered to MYR2.65 (-12%), maintain HOLD. Click here for full report » REGIONAL SECTOR UPDATE Regional Plantations: Maintain Neutral USA bans trans fat by 2018 The USA�s ban of trans fat by 2018 is positive for palm oil, but incremental demand is relatively small at 0.22m MT pa. No CPO price jump expected. But this could benefit IOI Corp for its 400,000 tpa specialty fats plant near Chicago, USA. Still NEUTRAL on the sector. Top BUYs are First Resources, Bumitama Agri, Genting Plantations, and Sarawak Oil Palms. Click here for full report » ECONOMICS Singapore NODX, May �15 Flattish� NODX fell slightly by -0.2% YoY last month Dragged by lower electronics exports and slower non-electronics exports Maintain our full-year NODX growth forecast of 2%-3% (2015 YTD: +3.3% YoY; 2014: -0.7%). Click here for full report » Technicals Persistent selling on rebounds The FBMKLCI gained 4.62 points to 1,726.86 yesterday, while the FBMEMAS and FBM100 also closed higher by 25.48 points and 26.51 points, respectively. We recommend a �Sell on Rallies� stance for the index. Trading idea is a Take Profit call on AIRASIA with downside target areas at MYR1.45 & MYR0.88. Click here for full report » Other Local News Transportation: Prasarana bids for two more projects in West Asia. Prasarana Malaysia is in the midst of bidding for two more transportation projects in West Asia. The projects are the operation and maintanance of the Jeddah Metro in Saudi Arabia and the Doha Metro in Qatar. The Jeddah Metro aims to increase the public transport commuter share in Jeddah, while the Doha Metro in Qatar's capital city is a rail transit system, an integral component of the larger Qatar Rail network and part of the country's preparations to host the 2022 Fifa World Cup. (Source: The Star) Mudajaya: Keen on 1MDB power assets. Mudajaya Group is interested in buying 1MDB power assets in Malaysia. Mudajaya have the capacity and can raise funds as their gearing ratio is quite low at only 0.1 time. The group still have MYR1b sukuk facility, of which they only issued MYR320m and their net cash is MYR117m. 1MDB power assets in Malaysia are parked under Tanjong Energy Holdings Sdn Bhd, Genting Sanyen Power Sdn Bhd and Jimah Energy Ventures Sdn Bhd. (Source: New Straits Times) Maxis: Sets up MYR5b sukuk plan. Maxis, the country's largest mobile operator by subscribers, has proposed to set up a MYR5b Islamic bond (sukuk) programme, with proceeds to be used for its capital expenditure and working capital, and to refinance other debt. The Securities Commission Malaysia has, vide its letter yesterday, given its approval for the unrated sukuk programme, which will have a tenure of up to 30 years. (Source: The Edge Financial Daily) Outside Malaysia U.S: Chinese buyers topped Canadians to rank as the biggest foreign purchasers of U.S. homes by both sales and dollar volume, accounting for more than a quarter of all international spending. Buyers from China spent USD 28.6b on U.S. homes and made up 16% of transactions by foreigners in the 12 months through March, according to an annual report released by the National Association of Realtors. Canadians, which had led international purchases since 2008, ranked second with USD 11.2b in spending and a 14% share of sales. (Source: Bloomberg) E.U: Said to extend Russia sanctions as Ukraine peace elusive. European Union governments struck a preliminary accord to extend sanctions against Russia by six months to the end of January, to keep up the pressure on the Kremlin to bring peace to eastern Ukraine. Representatives of the 28 governments agreed to prolong the trade and investment curbs, two EU officials said on condition of anonymity under EU media rules. Final confirmation of the move is due June 22, they said. (Source: Bloomberg) Japan: Exports rose at the slowest pace in May since a decline in August last year, sapping a recovery in the world's third-biggest economy. The value of overseas shipments increased 2.4% YoY, the Ministry of Finance said. Imports slid 8.7% YoY, leaving a JPY 216b (USD 1.7b) trade deficit. (Source: Bloomberg)     Key Indices Value YTD (%) Daily (%) KLCI 1,726.9 (2.0) 0.3 JCI 4,945.8 (5.4) 1.5 STI 3,325.9 (1.2) 0.8 SET 1,514.8 1.1 0.8 HSI 26,753.8 13.3 0.7 KOSPI 2,034.9 6.2 0.3 TWSE 9,189.8 (1.3) (0.2) DJIA 17,935.7 0.6 0.2 S&P 2,100.4 2.0 0.2 FTSE 6,680.6 1.7 (0.4) MYR/USD 3.758 7.4 0.2 CPO (1mth) 2,288.0 (0.1) (0.0) Crude Oil (1mth) 59.9 12.5 (0.1) Gold 1,185.6 0.1 0.3 TOP STOCK PICKS Buy rated large caps Price Target Tenaga Nasional 13.16 16.00 Axiata 6.48 7.60 Genting Malaysia 4.24 4.60 Gamuda 5.02 6.00 SP Setia 3.35 4.07 MBM Resources 3.50 4.20 Inari Amertron 3.38 4.05 Vitrox 3.35 4.05