Malaysia Daily, Maybank KE (2015-04-14)

Daily 14 April 2015 COMPANY UPDATE RHB Capital: Downgrade to Hold Proposes rights & restructuring Raising MYR2.5b via an estimated 1-for-6 rights issue; internal restructuring - RHB Bank assumes RHB Cap�s listing. Positive enhancement to ROE, and improves group CET1 ratio to 11%, but EPS dilutive. With only a 10% upside to our unchanged TP of MYR9.00, we downgrade RHB Cap to HOLD from BUY. Click here for full report » SECTOR UPDATE Malaysia Property: Maintain Neutral Cautiousness prevails at down south Demand slowdown is more evident in Iskandar Malaysia (IM), competition is increasingly stiff. Oversupply situation to be aggravated by huge incoming supply in 2015/2016. Remain cautious on IM; we prefer Klang Valley and Penang. Our defensive BUY is SP Setia. Click here for full report » Technicals Profit taking may cap any upside The FBMKLCI fell 2.23 points to 1,842.08 yesterday, while the FBMEMAS and FBM100 also closed lower by 14.36 points and 19.26 points, respectively. We recommend a �Nibble on Dips� stance for the index. Trading idea is a Short-Term Buy on YEELEE with upside target areas at MYR2.35 & MYR2.53. Stop loss is at MYR1.98. Click here for full report » Other Local News Materials: MPAS in discussions to build MYR1.6b complex. Malaysian Phosphate Additives (Sarawak) Sdn Bhd (MPAS), South-East Asia's first phosphate producer, is currently negotiating for the engineering, procurement and construction agreement for its MYR1.6b integrated phosphate complex project in Samalaju Industrial Park in Bintulu. The proposed complex will comprise nine integrated plants on 142ha with an annual production capacity of some 1.4 million tonnes of phosphate and related products per annum by 2020. The complex will be located near to the Samalaju deep-sea port, which is currently under construction. (Source: The Star) Petronas Chemicals: Plans MYR3b capex this year. Bulk of it will be for the Sabah Ammonia Urea (Samur) project. The Samur project, 90% completed, is expected to be completed and commissioned by the end of the first quarter of 2016. Upon completion, PCG will be the second largest urea producer in the region. Besides that, the capex will also allocated for two projects at joint venture company BASF Petronas Chemicals Sdn Bhd in Gebeng, Pahang. It includes the Integrated Aroma Ingredients Complex and the specialty chemical 2-Enthylhexanoic Acid (2-EHAcid) plant. (Source: The Sun) MRCB: Bids for French Embassy Land. MRCB said it has submitted a tender to acquire the 3.2ha piece of land that belongs to the French Embassy in Jalan Ampang. The French government was reportedly expecting bids of around MYR600m, which equates to about MYR1,800 per sq ft. (Source: The Edge Financial Daily) AmFIRST: To acquire Mydin store in Penang. It is expected to make its first investment in north through acquisition of a retail asset in Seberang Prai, Penang � owned by Mydin Mohamed Holdings for an estimated MYR250m. The REIT aims to balance its portfolio of commercial assets. (Source: The Edge Financial Daily) AirAsia: To list Indonesia and Philippine units, says Fernandez. However, Tan Sri Tony Fernandez did not give any timeline or value for the exercise. The plan for both IPOs will depend on getting the respective board approvals and he said business in both the Philippines and Indonesia is doing very well, with great support from both governments. (Source: The Edge Financial Daily) Outside Malaysia China: Export unexpectedly slumped the most in more than a year in March, eroding the outlook for one of the economy's better performing areas in recent months. Overseas shipments fell 14.6% YoY in yuan value, the customs administration said. Imports slid 12.3% YoY, leaving a trade surplus of CNY 18.16b (USD 3b). (Source: Bloomberg) India: CPI unexpectedly eases, boosting chances of rate cut. India's retail inflation unexpectedly slowed despite crop damage from unseasonal rains, boosting the possibility that central bank Governor Raghuram Rajan will cut rates outside the review cycle for a third time this year. Consumer prices rose 5.17% YoY in March after a 5.37% YoY increase in February, the Statistics Ministry said in a statement. (Source: Bloomberg) Philippines: Monetary authority announced details of a new deposit facility for banks, part of its efforts to curb liquidity and influence market interest rates more effectively. Banks will have to compete in weekly auctions for a fixed volume of term deposits with tenors ranging from one month to one year, Deputy Governor Diwa Guinigundo said. The overnight deposit will be auctioned daily in the afternoon in limited volumes, he said. (Source: Bloomberg)     Key Indices Value YTD (%) Daily (%) KLCI 1,842.1 (1.3) (0.1) JCI 5,447.4 27.4 (0.8) STI 3,484.4 10.0 0.3 SET 1,547.8 19.2 0.0 HSI 28,016.3 20.2 2.7 KOSPI 2,098.9 4.4 0.5 TWSE 9,666.5 12.3 0.5 DJIA 17,977.0 8.4 (0.4) S&P 2,092.4 13.2 (0.5) FTSE 7,064.3 4.7 (0.4) MYR/USD 3.709 13.2 1.1 CPO (1mth) 2,124.0 (19.2) 0.2 Crude Oil (1mth) 51.9 (47.3) 0.5 Gold 1,198.9 (0.2) (0.7) TOP STOCK PICKS Buy rated large caps Price Target Tenaga Nasional 14.44 16.00 Sime Darby 9.24 10.20 Genting Malaysia 4.61 4.60 Gamuda 5.11 6.00 Westport 4.17 4.50 SP Setia 3.42 4.07 AFG 4.76 5.30 Hartalega 8.30 8.50 Inari 3.46 3.95 MBM Resources 3.38 4.20 Vitrox 3.51 4.05