Friday, February 10, 2017

Tanco: Disposes of Duta Vista suites for MYR50m. Its indirect wholly-owned subsidiaries Tanco Properties S/B and Tanco Resorts signed a sales and purchase agreement today with Eternal Village for the proposed en-bloc sale of the 68 units of apartments and seven common area unit parcels with 75 car park bays within a six-storey building for MYR50m. After the exercise is completed, t






Maxis Bhd | Solid monetisation
Chi Wei Tan







Hartalega | Dampened by rising NBR cost
Yen Ling Lee









break





TRADERS' ALMANAC | SMALL-CAP STOCKS FRENZY
Tee Sze Chiah









break





Malaysia | Strong finish to 2016
Suhaimi Ilias








break


COMPANY RESEARCH





TP Revision





Maxis Bhd (MAXIS MK)
by Chi Wei Tan





Share Price:
MYR6.29
Target Price:
MYR6.00
Recommendation:
Hold




Solid monetisation

FY16 results were ahead of our forecasts as margins surprised on the upside. This, in our view, reflects a relatively manageable operating environment (certainly not as dire as commonly mooted). We lift FY17/ FY18 earnings forecasts. Maintain HOLD with a raised TP of MYR6.00 (+20sen). Risk-reward remains relatively balanced in our view.



FYE Dec (MYR m)
FY15A
FY16A
FY17E
FY18E
Revenue
8,601.0
8,612.0
8,795.0
8,973.7
EBITDA
4,398.0
4,469.0
4,529.4
4,621.5
Core net profit
1,809.5
1,927.5
1,863.8
1,878.4
Core EPS (sen)
24.1
25.7
24.8
25.0
Core EPS growth (%)
4.3
6.5
(3.3)
0.8
Net DPS (sen)
20.0
20.0
20.0
20.0
Core P/E (x)
26.1
24.5
25.3
25.1
P/BV (x)
11.3
10.0
9.3
8.7
Net dividend yield (%)
3.2
3.2
3.2
3.2
ROAE (%)
39.1
45.2
38.0
35.6
ROAA (%)
9.8
10.0
9.4
9.3
EV/EBITDA (x)
13.6
12.1
12.4
12.1
Net debt/equity (%)
205.5
194.5
177.1
156.4










Company Update





Hartalega (HART MK)
by Yen Ling Lee





Share Price:
MYR4.75
Target Price:
MYR3.80
Recommendation:
Sell




Dampened by rising NBR cost

We expect Hartalega’s upcoming 3QFY3/17 results to be flattish at the net profit level as the higher NBR cost offset the higher sales volume and higher USD/MYR. While ASP is on a rising trend, we think it still lags behind that of NBR cost. We maintain our EPS forecasts, SELL call and TP of MYR3.80 (21x 2017 PER; mean). Trading at 1-year fwd PER of 25x, valuation is demanding given its weaker financial metrics (margins, ROEs) and peers’ average PER of 17x.



FYE Mar (MYR m)
FY15A
FY16A
FY17E
FY18E
Revenue
1,146.0
1,498.3
1,627.7
1,860.1
EBITDA
321.6
386.8
426.6
495.5
Core net profit
209.7
257.6
277.2
315.1
Core FDEPS (sen)
13.4
15.5
16.7
19.0
Core FDEPS growth(%)
(15.1)
16.3
7.6
13.7
Net DPS (sen)
6.5
8.0
8.4
9.6
Core FD P/E (x)
35.6
30.6
28.4
25.0
P/BV (x)
5.8
5.2
4.8
4.3
Net dividend yield (%)
1.4
1.7
1.8
2.0
ROAE (%)
19.0
18.6
17.6
18.3
ROAA (%)
16.4
15.1
13.0
12.8
EV/EBITDA (x)
20.7
21.0
19.1
16.7
Net debt/equity (%)
net cash
10.9
21.5
26.1







SECTOR RESEARCH






SMALL-CAP STOCKS FRENZY
by Tee Sze Chiah


Sector Note





FBMKLCI was little changed on Wednesday after losing 0.34pts to settle at 1,688.50. Overall market was better after 471 stocks ended in green while 389 stocks closed in negative territory. Total trading volume was at 2.28b, valued at MYR2.32b. For today, we maintain our optimistic view as no reversal signals were spotted with the exception of 5-minute chart. As such, we expect the benchmark index to retest its two resistance levels at 1,692 and 1,696 in the near-term.









MACRO RESEARCH






Strong finish to 2016
by Suhaimi Ilias


Economics Research





Exports and imports ended last year on a high with Dec 2016’s growth of at +10.7% YoY (Nov 2016: +7.8% YoY) and +11.5% YoY (Nov 2016: +11.2% YoY) respectively as recovery in commodity prices and exports added to the sustained manufacturing exports growth. The outlook for this year is clouded by President Trump’s trade policy despite encouraging signs for commodity and manufacturing exports in early-2017.







NEWS


Outside Malaysia:

U.S: Jobless claims unexpectedly fall to lowest since November, echoing a vibrant job market. Jobless claims fell by 12,000 to 234,000 in the week ended Feb. 4, a report from the Labor Department showed. The average number of applications filed over the past four weeks reached the lowest point since 1973. The latest results extend a trend of historically low claims, with applications staying below 300,000 in the longest streak since 1970. A shortage of skilled workers is prompting companies to hold on to existing employees while continuing to add more workers to help fulfill demand. (Source: Bloomberg)

U.S: Home prices rose in 89% of metro areas in 4Q 2016, as competition heated up for a record-low supply of listings, the National Association of Realtors said. The median price of an existing single-family home rose from a year earlier in 158 of the 178 areas measured, the group said in a report. In the third quarter, 87% of metropolitan areas had price increases. Thirty-one regions had gains of 10% of more in the three months through December, up from 25 in the third quarter. (Source: Bloomberg)

U.S: Trump promises ‘phenomenal’ tax plan as Ryan’s ideas draw fire. President Donald Trump said a “phenomenal” plan to overhaul business taxes may be released within the next “two or three weeks,” heightening expectations as House Republican lawmakers are raising objections to their own leaders’ favored plan. Trump offered no details -- and White House Press Secretary Sean Spicer told reporters later that specifics would emerge only in the coming weeks. Still, he said the White House is at work on an outline of the most comprehensive business and individual tax overhaul since 1986. During a meeting with U.S. airline executives, Trump said his plans call for “lowering the overall tax burden of American businesses, big league.” He added: “We’re going to be announcing something I would say over the two or three weeks that will be phenomenal in terms of tax.” (Source: Bloomberg)





Other News:

Tanco: Disposes of Duta Vista suites for MYR50m. Its indirect wholly-owned subsidiaries Tanco Properties S/B and Tanco Resorts signed a sales and purchase agreement today with Eternal Village for the proposed en-bloc sale of the 68 units of apartments and seven common area unit parcels with 75 car park bays within a six-storey building for MYR50m. After the exercise is completed, the proposed disposal is expected to result in a net gain of about MYR4.86m after taking into account the carrying value of the property and related expenditure amounting to MYR44.89m, estimated provision for income tax/real property gains tax (net of deferred tax) totalling MYR150,000, and expenses in relation to the proposed disposal costing MYR100,000.(Source: The Edge Financial Daily)

SCGM: Set to build new facility in Kulai. The group is set to commence construction of its new MYR54m manufacturing facility in Kulai, Johor. The facility, spread over 7.8ha is located about 5km from the company’s existing premises, and scheduled for completion in December 2018. In a statement on Wednesday, Managing director Datuk Seri Lee Hock Chai said the enlarged production floor space and new machinery at the facility, would bump up the group’s extrusion capacity by 73% to 62.6 million kg per year from the current 36 million. (Source: The Star)

Spring Gallery: To diversify into property. Ceramics and pottery products manufacturer Spring Gallery proposes to diversify into the property investment and development business, which will potentially contribute at least 25% to the company’s net profit. The group said it intends to venture into property development through a residential development project in Kuala Lumpur, whereby it had on April 22 entered into a heads of agreement to acquire an 80% stake in Klasik Ikhtiar S/B for MYR3.5m. (Source: The Sun Daily)


No comments:

Post a Comment

Related Posts with Thumbnails