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Share
Price:
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MYR1.46
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Target
Price:
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MYR1.48
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Recommendation:
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Hold
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Launches CJ Wow
Shop
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Today, MPR launches its 51%-owned home shopping business
called CJ Wow Shop. All in, MPR does not expect CJ Wow Shop to
negatively impact its earnings materially. We leave our sufficiently
conservative earnings estimates (in our view) and MYR1.48 TP based on
1.3x FY16 P/B unchanged. With narrowed upside potential to our TP, MPR
is now a HOLD (from BUY). Since we upgraded MPR to a BUY on 14 Aug
2015, its share price has already appreciated 28% with 10sen DPS to
boot.
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FYE Dec (MYR m)
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FY14A
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FY15A
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FY16E
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FY17E
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Revenue
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1,507.0
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1,427.7
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1,464.8
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1,526.5
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EBITDA
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310.8
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325.8
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313.5
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324.0
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Core net profit
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141.6
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138.7
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143.0
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156.4
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Core FDEPS (sen)
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12.6
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12.5
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12.8
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14.0
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Core FDEPS growth(%)
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(34.2)
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(0.9)
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2.5
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9.4
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Net DPS (sen)
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11.0
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10.0
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11.0
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12.0
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Core FD P/E (x)
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11.6
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11.7
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11.4
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10.4
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P/BV (x)
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1.0
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1.0
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1.0
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1.0
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Net dividend yield (%)
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7.5
|
6.8
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7.5
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8.2
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ROAE (%)
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8.7
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8.6
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8.8
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9.5
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ROAA (%)
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5.6
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5.8
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6.1
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7.0
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EV/EBITDA (x)
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6.0
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4.0
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4.7
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4.5
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Net debt/equity (%)
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net cash
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net cash
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net cash
|
net cash
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Samuel Yin Shao
Yang
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Jade Tam
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Gamuda (GAM MK)
by Li Shin
Chai
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Share
Price:
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MYR4.92
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Target
Price:
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MYR5.65
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Recommendation:
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Buy
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KVMRT 2
underground works in the bag
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MMC-Gamuda JV won the KVMRT 2 underground works package
worth MYR15.5b, boosting Gamuda’s outstanding orderbook to MYR8.3b (50%
stake). The higher-than-expected contract value and further job win
potential provide upside to our earnings forecasts. Our earnings
forecasts are unchanged pending further clarification from management.
Reiterate BUY with an unchanged RNAV-TP of MYR5.65.
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FYE Jul (MYR m)
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FY14A
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FY15A
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FY16E
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FY17E
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Revenue
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4,636.4
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2,399.9
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2,587.7
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3,116.7
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EBITDA
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775.2
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638.0
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770.0
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828.0
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Core net profit
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712.2
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682.1
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663.9
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701.1
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Core EPS (sen)
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31.0
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28.9
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27.6
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29.1
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Core EPS growth (%)
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4.9
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(6.6)
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(4.6)
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5.6
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Net DPS (sen)
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12.0
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12.0
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12.0
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12.0
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Core P/E (x)
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15.9
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17.0
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17.8
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16.9
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P/BV (x)
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2.1
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1.8
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1.9
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1.8
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Net dividend yield (%)
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2.4
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2.4
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2.4
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2.4
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ROAE (%)
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13.8
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11.6
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10.5
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10.7
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ROAA (%)
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7.6
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5.8
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4.9
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4.9
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EV/EBITDA (x)
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17.2
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22.7
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20.0
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18.8
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Net debt/equity (%)
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30.1
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43.7
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49.8
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47.5
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Share
Price:
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MYR1.69
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Target
Price:
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MYR2.30
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Recommendation:
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Buy
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Wins MYR134m job
from MRT Corp
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WCT won a police quarters redevelopment from MRT Corp
worth MYR133m, raising outstanding orderbook by 3.5% to MYR4b. Further
job wins could come from other infrastructure projects and TODs; job
wins could exceed the 2016 MYR1b imputed in our model. Our earnings
forecasts are unchanged. Potential earnings recovery and corporate
exercises would re-rate the stock. BUY at unchanged MYR2.30 TP.
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FYE Dec (MYR m)
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FY14A
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FY15A
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FY16E
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FY17E
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Revenue
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1,662.2
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1,667.9
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2,250.2
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2,400.5
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EBITDA
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147.5
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145.7
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242.0
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256.9
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Core net profit
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112.3
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129.3
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134.8
|
146.5
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Core EPS (sen)
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10.3
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11.3
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11.2
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12.2
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Core EPS growth (%)
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(44.9)
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9.6
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(0.4)
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8.7
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Net DPS (sen)
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6.2
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4.2
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4.2
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4.2
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Core P/E (x)
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16.4
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15.0
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15.0
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13.8
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P/BV (x)
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0.8
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0.7
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0.7
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0.7
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Net dividend yield (%)
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3.7
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2.5
|
2.5
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2.5
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ROAE (%)
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5.1
|
5.3
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5.1
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5.3
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ROAA (%)
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1.9
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2.0
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1.9
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2.0
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EV/EBITDA (x)
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21.6
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27.1
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16.8
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16.1
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Net debt/equity (%)
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66.4
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78.9
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73.9
|
73.6
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SECTOR RESEARCH
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Sector Note
by
Desmond Ch'ng
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Loan growth
still southbound
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Industry loan growth continues to slow, with the
moderation in HH loan growth notably more significant in Feb 2016.
While still early days, our 2016 industry loan growth forecast of
6.5% (7.9% in 2015) is still within reach and this is premised on HH
loan growth of just 6.1% and non-HH loan growth of 7.0%. NEUTRAL
maintained on the sector - BUY AFG, HL Bank and HLFG, SELL AMMB.
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MACRO RESEARCH
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Economics Research
by
Suhaimi Ilias
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Stopped slowing
post-SRR cut…
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Money supply (M3) growth picked up (Feb 2016: +2.7%
YoY; Jan 2016: +2.2% YoY) amid slight uptick in total deposits (Feb
2016: +0.7% YoY; Jan 2016: +0.1% YoY) after SRR was cut by 50bps to
3.50% effective 1 Feb 2016. BNM kept SRR unchanged at the recent MPC
meeting on 8-9 Mar 2016.
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Suhaimi Ilias
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Zamros
Dzulkafli
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Technical Research
by Lee
Cheng Hooi
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Sell! 1Q window
dressing is over
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The FBMKLCI lost 0.24 points to close at 1,717.58
yesterday, while the FBMEMAS gained 0.45 points, but the FBM100 fell
0.41 points respectively. In terms of market breadth, the
gainer-to-loser ratio was 397-to-406, while 387 counters were
unchanged. A total of 1.80b shares were traded valued at MYR2.54b.
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NEWS
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Outside Malaysia:
E.U: Inflation was negative for a second month in March,
in data released on the eve of the European Central Bank’s first day of
expanded debt purchasing to fight deflation. The consumer price index in
the 19-nation bloc fell 0.1% YoY after a 0.2% YoY drop in February,
according to data published. Core inflation, which strips out volatile
elements such as food and energy, was at 1% YoY, up from 0.8% YoY in the
prior month. (Source: Bloomberg)
Germany: Unemployment was unchanged in March, snapping a
run of five consecutive declines, in a sign that Europe’s largest economy
may be struggling to absorb a wave of refugees. The number of people out
of workheld at a seasonally adjusted 2.73 million, data from the Federal
Labor Agency showed. The jobless rate stayed at a record-low 6.2%.
Germany admitted more than 1 million migrants in 2015 alone, increasing
the pool of potential workers. (Source: Bloomberg)
China: Rating outlook cut at S&P on risk of slower
rebalancing. Standard & Poor’s has cut the outlook for China’s credit
rating to negative from stable, saying the nation’s economic rebalancing
is likely to proceed more slowly than the ratings firm had expected.
China’s AA- long-term credit rating now has a negative outlook, S&P
said in a statement. (Source: Bloomberg)
China: Central bank revealed its short foreign-currency
positions in forwards and futures for the first time, providing more
clarity on the monetary authority’s efforts to shore up the yuan. The
People’s Bank of China held USD 28.9b of such positions with commercial
lenders as of the end of February, which mainly reflects the currency
hedging demand from domestic companies, according to a statement posted
on its website. The amount is less than half of the average monthly
decline of the country’s foreign reserves since August, when China made a
surprise devaluation of the yuan and allowed market forces to play a
bigger role in setting the exchange rate. (Source: Bloomberg)
Japan: Corporate sentiment slumps to near three-year low
as a stronger yen posed risks to company profits, undermining efforts to
spur recovery in the world’s third-largest economy. The Tankan index of
confidence among large manufacturers stood at 6 in March, the Bank of
Japan said, declining from 12 three months ago. A positive number means
there are more optimists than pessimists among manufacturers. (Source:
Bloomberg)
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Other News:
Sunway: To invest MYR875m in hotels. Its hospitality
division Sunway Hotels & Resorts is investing on a three-year
redevelopment and expansion plan on its hotels across Malaysia, Cambodia
and Vietnam. This will be completed by second quarter of 2018, with
MYR530m of investments on new assets and MYR345m for refurbishment and
expansion of existing new assets. Upon completion of all expansion plans,
the group will own and operate 11 hotels, nine of which are in Malaysia.
(Source: The Sun Daily)
AirAsia: To raise funds up to USD200m - sources. This was
revealed by sources, hours after company announced a halt in trading of
its shares pending an announcement which was done without giving any
details. On a separate note, AirAsia said it was not considering going
private at this stage, said founders Tan Sri Tony Fernandes and Datuk
Kamaruddin Meranun. (Source: The Edge Financial Daily)
Ireka: 23% associate sells Aloft KL for MYR419m. Aseana
Properties Ltd, a London-listed property developer in which Ireka Corp
has a 23% stake is selling it to Prosper Group Holdings Ltd. The gross
transaction includes the purchase of the entire issued share capital of
ASPL M3B Ltd and Iringan Flora Sdn Bhd, and assumptions of certain debts,
assets and liabilities of the Aloft companies (Source: The Edge Financial
Daily)
Pestech International: Wins Klang Valley Double Track job
worth MYR318m. The contract was awarded by Dhaya Maju Infrastructure and
was for the design, construction, completion, testing, commissioning and
maintenance of the systems works for the project involving the upgrading
of the facility of KVDT infrastructure. Dhaya Maju is the turnkey
contractor for the project, which will start today, and be completed
within 42 months or on Sept 30, 2019. (Source: The Sun Daily)
IOI Corp: Beefs up sustainable measures after RSPO
suspension. IOI Corp CEO said these included putting in place a new
sustainability team structure – which will require its sustainability
heads at all operating divisions to report to the group sustainability
head, who will the report to the CEO. Also, IOI Corp will be setting aside
land equivalent to its plantation areas for conservation to compensate
for affected high conservation areas. (Source: The Edge Financial Daily)
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