Affin Daily Insight (LV) - 24 March 2014 - PROPERTY / MISC / ECONOMY - CPI / ECONOMY - ASEAN OUTLOOK / DMR

Top Calls

Sector Update � Property (NEUTRAL, maintain) - Bracing for a cyclical slowdown We believe the Malaysian property market is heading for a cyclical slowdown after a strong 4-year property bull cycle. Broadly we expect developers to achieve lower take-up rates and weaker profit margins in view of higher competition, cautious bank lending, implementation of tough government property cooling measures and lower affordability. That said, we expect developers� 2014-15 earnings to remain resilient, underpinned by high unbilled sales. Maintain NEUTRAL. While we are cautious, we believe that downside risk to share prices is limited, in view of the following: (i) developers are now trading at a fair 0.4-0.6x P/RNAV, broadly within the historical trading range; (ii) developers� balance sheets are generally strong and their 2014-15 earnings are still resilient; and (iii) the long-term fundamentals (demographics, economic environment) have remained supportive. Our top pick for the sector is IJM Land (BUY, TP RM3.30).

Other Calls

Flash Note � MISC (ADD, maintain) - Disposes MIL for RM250m

Economy - CPI - February's headline inflation rose sharply to +3.5% yoy

Economy � ASEAN Outlook � Weekly Wrap (17 - 21 March 2014) - Philippine may normalise policy interest rate this week

Debt Market Research - Softness continues following FOMC statement

Morning News & Market Summary

For important disclosures, please refer to the Disclosure section at the end of the individual linked research reports.

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