Malaysia Daily, Maybank KE (2014-04-08)

Daily	08 April 2014
ACQUISITIONS / DISPOSAL Sime Darby: Maintain Buy Divesting Malaysian power business  Shariah-compliant Sime is disposing its 75%-stake in Port Dickson Power (PDP) plant and its O&M business for MYR300m cash. The disposal of this non-core business comes as no surprise as it is in line with Sime�s 5-year strategy blueprint. Maintain BUY and MYR10.20 TP pegged at 18x 2015 PER. Click here for full report » COMPANY UPDATE Lafarge Malaysia: Maintain Buy Potential injection of Holcim?  Shariah-compliant The merger of its French parent and the Swiss Holcim may see the injection of Holcim Malaysia into Lafarge Malaysia. There will be synergies from streamlining of operations, although small in earnings enhancement by our estimates. Maintain BUY and TP of MYR9.90 (21x FY15 PER). Click here for full report » Padini Holdings: Maintain Buy Still in an expansion mode  Shariah-compliant Padini is on track to add 11 new big outlets in FY14 and it is eyeing another 5 new locations for FY15. In 1HFY14, BO/PCS recorded SSSG of +24%/-3.6%, aided by the better performance in 2QFY14 (BO: +31%, PCS: +5.7%). Still one of the cheapest retail stocks in Malaysia with good yields as well. TP raised to MYR2.35 (+25%) on 14.8x CY14 (2SD above mean), vs 20x sector average. BUY. Click here for full report » Technicals Above 1,860 on late buying The FBMKLCI advanced 6.29 points to close at 1,862.90 yesterday, while the FBMEMAS and FBM100 also closed higher by 42.27 points and 46.96 points, respectively. Due to the KLCI April Futures moving into a small 2.90-points discount against the FBMKLCI, we expect slow trading towards the higher resistance zone of 1,864 to 1,882, with further local buying activities despite the American markets tumbling last night. Trading idea is a Short-Term Buy on SBCCORP with upside target areas at MYR2.31 & MYR2.70. Stop loss is at MYR1.91. Click here for full report » Other Local News Infrastructure: High speed rail link to complete by 2020. Malaysia and Singapore prime ministers have reiterated that the proposed High-Speed Rail Link between the republic and Kuala Lumpur will be completed as scheduled in 2020. Prime Minister Datuk Seri Najib Razak said both governments were mindful of the fact that the project was ambitious and both governments were working hard towards meeting the deadline. This project would enhance cross-border connectivity between countries. (Source: Business Times) Oil & Gas: Petronas launches hull of its first floating LNG facility. This facility is scheduled for completion in 4Q, 2015, with its 365m-long haul, will be the world�s first floating LNG facility. (Source: The Edge Financial Daily) Infrastructure: Government can end six toll concessions before expiry. Government can terminate six of such contracts which are signed under third generation of toll agreements once concessionaires realize their investments. Third generation agreements have longer tenure between 45 to 65 years, as compared to first and second generation, a duration between 23 to 33 years and 30 to 35 years respectively. (Source: The Edge Financial Daily) Banking: Affin completes HwangDBS IB buy. Affin Holdings Bhd said it currently owned 100% interest in HwangDBS IB, and would implement the merger of Affin Investment Bank Bhd and HwangDBS IB. (Source: The Star) Maybank: Plans China expansion. It saw encouraging loan growth in Greater China last year and plans to open more branches in the country �soonest possible�. Group president and CEO Datuk Abdul Farid Alias said Maybank is in talks with the China Banking Regulatory Commission (CBRC) over its expansion plan. (Source: Business Times) Boustead Plantations: Set to raise MYR928m. Shareholders� approvals for listing of Boustead Plantations have been received. The listing is slated for mid-June. Group MD Tan Sri Lodin Wok Kamaruddin said IPO is timely because the price of crude palm oil is on uptrend. (Source: Business Times) Outside Malaysia Asia: Developing East Asian economies will grow slower than forecast this year as China's expansion moderates and political upheaval weighs on Thailand's outlook, the World Bank said. China will expand 7.6% this year, down from 7.7% projected in October, while Thailand will grow 3%, 1.5 percentage points lower than seen six months ago, the World Bank said in its East Asia and Pacific Economic Update. Developing East Asia is forecast to grow 7.1% in 2014, down from 7.2% seen in October, it showed. (Source: Bloomberg) U.S: Consumer credit rose more than forecast in February, reflecting the biggest gain in automobile, school and other non-revolving loans in a year. The USD 16.5b advance in credit followed a revised USD 13.8b gain in the previous month, Federal Reserve figures showed in Washington. (Source: Bloomberg) Germany: Industrial output rose for a fourth month in February in a sign that growth in Europe's largest economy continued to accelerate. Production, adjusted for seasonal swings, climbed 0.4% MoM from January, when it gained a revised 0.7% MoM, the Federal Statistics Office said. Production jumped 4.8% YoY in February from the previous year when adjusted for working days. (Source: Bloomberg)     Key Indices Value YTD (%) Daily (%) KLCI 1,862.9 (0.2) 0.3 JCI 4,921.0 15.1 1.3 STI 3,193.6 0.8 (0.6) SET 1,392.0 7.2 0.0 HSI 22,377.2 (4.0) (0.6) KOSPI 1,989.7 (1.1) 0.1 TWSE 8,876.4 3.1 (0.1) DJIA 16,245.9 (2.0) (1.0) S&P 1,845.0 (0.2) (1.1) FTSE 6,622.8 (1.9) (1.1) MYR/USD 3.3 (0.2) (0.3) CPO (1mth) 2,668.0 1.5 (1.4) Crude Oil (1mth) 100.4 2.1 (0.7) Gold 1,297.3 8.0 (0.5) TOP STOCK PICKS Buy rated large caps Price Target Tenaga 11.68 14.00 Genting Msia 4.24 4.74 HLBK 14.14 16.40 AMMB Holdings 7.21 8.50 Bumi Armada 3.99 5.00 IJM Corp 6.29 6.75 Time dotCom 4.06 4.40 MPHB Capital 1.97 2.42