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|
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|
Share
Price:
|
MYR4.00
|
|
Target
Price:
|
MYR4.70
|
|
Recommendation:
|
Buy
|
|
|
|
|
|
|
|
|
2Q16 surprised
positively
|
|
BIMB’s earnings were better than expected and our FY16-18
earnings forecasts are raised by 3% for each FY. Fundamentals for both
Bank Islam and Syarikat Takaful (STMB) remain strong. Our SOP-TP is
raised to MYR4.70 from MYR4.00. Our valuations for Bank Islam are
rolled forward and our P/BV peg is raised to 1.5x from 1.3x, on the
back of a higher FY17 ROE of 12.3% (11.9% previously). BIMB is now a
BUY.
|
|
|
|
|
|
|
FYE Dec (MYR m)
|
FY14A
|
FY15A
|
FY16E
|
FY17E
|
|
Operating income
|
2,122.5
|
2,289.7
|
2,448.9
|
2,556.5
|
|
Pre-provision profit
|
871.7
|
908.3
|
983.2
|
995.6
|
|
Core net profit
|
532.3
|
547.3
|
551.5
|
566.7
|
|
Core EPS (MYR)
|
0.36
|
0.35
|
0.36
|
0.37
|
|
Core EPS growth (%)
|
37.9
|
(0.4)
|
0.9
|
2.7
|
|
Net DPS (MYR)
|
0.15
|
0.12
|
0.12
|
0.13
|
|
Core P/E (x)
|
11.2
|
11.3
|
11.2
|
10.9
|
|
P/BV (x)
|
2.0
|
1.8
|
1.5
|
1.4
|
|
Net dividend yield (%)
|
3.7
|
3.0
|
3.0
|
3.1
|
|
Book value (MYR)
|
1.97
|
2.21
|
2.59
|
2.83
|
|
ROAE (%)
|
18.5
|
17.2
|
14.6
|
13.2
|
|
ROAA (%)
|
1.0
|
1.0
|
0.9
|
0.9
|
|
|
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|
|
|
|
Share
Price:
|
MYR4.24
|
|
Target
Price:
|
MYR4.10
|
|
Recommendation:
|
Hold
|
|
|
|
|
|
|
|
|
Improving
fundamentals
|
|
We upgrade Top Glove to HOLD (from SELL) with an unchanged
TP of MYR4.10 (15x CY17 PER; historical mean) because: (i) its share
price has fallen 14% since our downgrade in Jun 2016 and is just 3%
away from our fair value; (ii) we think its sequential earnings could
improve slightly on the easing of nitrile competition; and (iii) we
expect good support at current levels as the stock is already trading
at its mean PER.
|
|
|
|
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|
FYE Aug (MYR m)
|
FY14A
|
FY15A
|
FY16E
|
FY17E
|
|
Revenue
|
2,275.4
|
2,510.5
|
2,979.8
|
3,057.9
|
|
EBITDA
|
298.5
|
454.3
|
564.4
|
511.4
|
|
Core net profit
|
180.5
|
279.8
|
376.9
|
326.6
|
|
Core EPS (sen)
|
14.6
|
22.6
|
30.4
|
26.3
|
|
Core EPS growth (%)
|
(8.2)
|
55.0
|
34.7
|
(13.3)
|
|
Net DPS (sen)
|
8.0
|
11.5
|
15.2
|
13.2
|
|
Core P/E (x)
|
29.1
|
18.8
|
14.0
|
16.1
|
|
P/BV (x)
|
3.8
|
3.3
|
2.9
|
2.7
|
|
Net dividend yield (%)
|
1.9
|
2.7
|
3.6
|
3.1
|
|
ROAE (%)
|
13.3
|
18.6
|
22.1
|
17.4
|
|
ROAA (%)
|
9.8
|
12.1
|
13.4
|
10.8
|
|
EV/EBITDA (x)
|
9.4
|
10.1
|
8.9
|
9.6
|
|
Net debt/equity (%)
|
net cash
|
net cash
|
net cash
|
net cash
|
|
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|
|
|
|
|
|
|
Share
Price:
|
MYR0.77
|
|
Target
Price:
|
MYR1.05
|
|
Recommendation:
|
Buy
|
|
|
|
|
|
|
|
|
Core 1H16
earnings in line
|
|
1H16 core net profit made up 48%/54% of ours/consensus FY
forecasts. The investment focus from 2017 onwards is on improving its
risk-reward outlook. A rebound in earnings from the successful delivery
of 4 key FPSO/FSU projects from 4Q16 and potentially new FPSO job(s)
wins coupled with a positive outcome from the Armada Claire’s ongoing
court case are key catalysts. Our SOP-based MYR1.05 TP (unchanged).
|
|
|
|
|
|
|
FYE Dec (MYR m)
|
FY14A
|
FY15A
|
FY16E
|
FY17E
|
|
Revenue
|
2,397.3
|
2,179.7
|
1,509.8
|
2,669.9
|
|
EBITDA
|
1,029.4
|
1,101.7
|
1,072.0
|
1,529.0
|
|
Core net profit
|
399.6
|
360.7
|
215.4
|
590.8
|
|
Core EPS (sen)
|
7.9
|
6.1
|
3.7
|
10.1
|
|
Core EPS growth (%)
|
(48.4)
|
(22.2)
|
(40.3)
|
174.3
|
|
Net DPS (sen)
|
1.6
|
0.8
|
0.0
|
0.0
|
|
Core P/E (x)
|
9.7
|
12.4
|
20.8
|
7.6
|
|
P/BV (x)
|
0.6
|
0.6
|
0.7
|
0.6
|
|
Net dividend yield (%)
|
2.1
|
1.1
|
0.0
|
0.0
|
|
ROAE (%)
|
7.2
|
5.2
|
3.1
|
8.3
|
|
ROAA (%)
|
3.4
|
2.2
|
1.2
|
3.1
|
|
EV/EBITDA (x)
|
8.2
|
11.4
|
11.4
|
7.6
|
|
Net debt/equity (%)
|
43.2
|
89.6
|
112.0
|
94.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share
Price:
|
MYR2.57
|
|
Target
Price:
|
MYR3.00
|
|
Recommendation:
|
Buy
|
|
|
|
|
|
|
|
|
Deep in value
|
|
We remain positive on MBM following last week’s briefing;
2H16 earnings should be much better than 1H16 with maiden contribution
of the Perodua Bezza. Investments in the last three years (i.e. Perodua
and Hino’s plants, OMI Alloy) should make a more significant
contribution in the coming years. Our forecasts are largely unchanged
(-1% for FY16-18) but we raise our TP to MYR3.00 (+11%) as we peg MBM
on 10x FY17 PER (5-year mean valuations; from 9x) on improving outlook.
|
|
|
|
|
|
|
FYE Dec (MYR m)
|
FY14A
|
FY15A
|
FY16E
|
FY17E
|
|
Revenue
|
1,774.1
|
1,815.1
|
1,742.7
|
1,916.2
|
|
EBITDA
|
17.8
|
49.7
|
24.9
|
28.7
|
|
Core net profit
|
112.2
|
87.1
|
88.7
|
117.0
|
|
Core EPS (sen)
|
28.7
|
22.3
|
22.7
|
30.0
|
|
Core EPS growth (%)
|
(18.8)
|
(22.3)
|
1.8
|
31.9
|
|
Net DPS (sen)
|
8.0
|
10.0
|
8.0
|
8.0
|
|
Core P/E (x)
|
9.0
|
11.5
|
11.3
|
8.6
|
|
P/BV (x)
|
0.7
|
0.6
|
0.6
|
0.6
|
|
Net dividend yield (%)
|
3.1
|
3.9
|
3.1
|
3.1
|
|
ROAE (%)
|
7.6
|
5.6
|
5.6
|
7.0
|
|
ROAA (%)
|
4.6
|
3.7
|
3.7
|
4.6
|
|
EV/EBITDA (x)
|
91.1
|
28.2
|
54.8
|
46.4
|
|
Net debt/equity (%)
|
13.1
|
10.3
|
2.8
|
0.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share
Price:
|
MYR1.87
|
|
Target
Price:
|
MYR1.95
|
|
Recommendation:
|
Hold
|
|
|
|
|
|
|
|
|
FMCG to be the
main driver
|
|
We believe that FMCG should still be the main earnings
driver in the near term, supported mainly by growing exports. As for
F&B, while sales remained relatively soft, it should see gradual
recovery into 2H16 supported by festivities and A&P efforts. Maintain
earnings forecasts and TP of MYR1.95 (14.8x CY17 PER; mean).
|
|
|
|
|
|
|
FYE Mar (MYR m)
|
FY15A
|
FY16A
|
FY17E
|
FY18E
|
|
Revenue
|
397.7
|
393.4
|
422.0
|
459.2
|
|
EBITDA
|
82.9
|
84.5
|
91.2
|
95.6
|
|
Core net profit
|
51.0
|
55.3
|
57.6
|
61.3
|
|
Core EPS (sen)
|
11.2
|
11.9
|
12.4
|
13.2
|
|
Core EPS growth (%)
|
4.2
|
6.1
|
4.3
|
6.4
|
|
Net DPS (sen)
|
6.0
|
9.0
|
6.8
|
7.3
|
|
Core P/E (x)
|
16.6
|
15.7
|
15.0
|
14.1
|
|
P/BV (x)
|
2.5
|
2.4
|
2.2
|
2.1
|
|
Net dividend yield (%)
|
3.2
|
4.8
|
3.7
|
3.9
|
|
ROAE (%)
|
15.2
|
15.8
|
15.4
|
15.3
|
|
ROAA (%)
|
11.8
|
12.5
|
12.4
|
12.4
|
|
EV/EBITDA (x)
|
8.2
|
6.5
|
7.7
|
7.1
|
|
Net debt/equity (%)
|
net cash
|
net cash
|
net cash
|
net cash
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SET Thailand Corporate Day 2015
|
|
|
|
|
|
|
|
|
|
|
Share
Price:
|
MYR0.68
|
|
Target
Price:
|
MYR0.70
|
|
Recommendation:
|
Hold
|
|
|
|
|
|
|
|
|
1H16 in line
|
|
Interim results were in line on weaker QoQ performance.
Our forecasts are unchanged. Securing the upcoming Pan Malaysia T&I
package due in 2017, Barakah being the incumbent, is crucial.
Otherwise, Barakah is fairly valued. Our TP is based on 10x 2017 FD PER
(unchanged).
|
|
|
|
|
|
|
FYE Dec (MYR m)
|
FY14A
|
FY15A
|
FY16E
|
FY17E
|
|
Revenue
|
866.3
|
592.6
|
596.0
|
669.8
|
|
EBITDA
|
141.5
|
38.6
|
79.5
|
117.3
|
|
Core net profit
|
74.5
|
12.8
|
30.5
|
60.0
|
|
Core EPS (sen)
|
8.6
|
1.5
|
3.5
|
7.0
|
|
Core EPS growth (%)
|
81.3
|
(82.8)
|
138.6
|
96.7
|
|
Net DPS (sen)
|
0.0
|
0.0
|
0.0
|
0.0
|
|
Core P/E (x)
|
7.8
|
45.6
|
19.1
|
9.7
|
|
P/BV (x)
|
1.4
|
1.6
|
1.5
|
1.3
|
|
Net dividend yield (%)
|
0.0
|
0.0
|
0.0
|
0.0
|
|
ROAE (%)
|
28.4
|
3.8
|
9.3
|
16.1
|
|
ROAA (%)
|
12.1
|
1.8
|
4.5
|
8.7
|
|
EV/EBITDA (x)
|
5.1
|
21.8
|
8.5
|
4.6
|
|
Net debt/equity (%)
|
11.0
|
23.7
|
26.3
|
6.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share
Price:
|
MYR1.10
|
|
Target
Price:
|
MYR1.20
|
|
Recommendation:
|
Hold
|
|
|
|
|
|
|
|
|
2Q16: In line
|
|
THP’s 2Q16 results were within our expectation despite its
slightly lower FFB production as deferred tax lifted its bottom line.
Earnings should improve HoH in 2H16 on seasonally stronger production.
Maintain HOLD at an unchanged TP of MYR1.20 based on 1x trailing P/NTA
(-1SD of 3-year mean trailing P/NTA).
|
|
|
|
|
|
|
FYE Dec (MYR m)
|
FY14A
|
FY15A
|
FY16E
|
FY17E
|
|
Revenue
|
488.9
|
455.3
|
525.6
|
554.8
|
|
EBITDA
|
156.8
|
75.4
|
174.8
|
178.2
|
|
Core net profit
|
34.6
|
9.7
|
30.0
|
30.4
|
|
Core EPS (sen)
|
3.9
|
1.1
|
3.4
|
3.4
|
|
Core EPS growth (%)
|
(45.4)
|
(72.0)
|
210.5
|
1.2
|
|
Net DPS (sen)
|
2.0
|
0.0
|
1.0
|
1.0
|
|
Core P/E (x)
|
28.1
|
100.5
|
32.4
|
32.0
|
|
P/BV (x)
|
0.8
|
0.8
|
0.8
|
0.7
|
|
Net dividend yield (%)
|
1.8
|
0.0
|
0.9
|
0.9
|
|
ROAE (%)
|
2.9
|
0.8
|
2.3
|
2.3
|
|
ROAA (%)
|
1.0
|
0.3
|
0.9
|
0.9
|
|
EV/EBITDA (x)
|
16.8
|
33.7
|
14.4
|
14.2
|
|
Net debt/equity (%)
|
60.7
|
91.3
|
92.1
|
90.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SECTOR RESEARCH
|
|
|
|
|
|
|
|
Sector Note
by Wei
Sum Wong
|
|
|
|
|
|
|
Impact of HSR on
property values
|
|
|
|
|
|
|
While a better connectivity between the two capitals,
Kuala Lumpur and Singapore, via the HSR is positive for property
values around the station stops, the quantum of the land value lift
is dependent on various factors including the fare structure (affordability)
and the efficacy of the entire transportation system. In our view,
beneficiaries in the property sector would still be the land owners
near the station stops – the ones we can identify for now are Sime
Darby, GENP and IOIPG.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MACRO RESEARCH
|
|
|
|
|
|
|
|
Economics Research
by
Suhaimi Ilias
|
|
|
|
|
|
|
“Negative” start
to 2H 2016
|
|
|
|
|
|
|
Industrial Production (IP) shrank -3.6% YoY in July
2016 (June 2016: +0.3% YoY) dragged by most major clusters except
Electronics. “Negative” start to 2H 2016 plus weaker business
expectations for the period is consistent with our view that real GDP
growth will slow after the +2.1% expansion in 1H 2016, hence our
full-year forecast of +1.8%.
|
|
|
|
|
|
Suhaimi Ilias
|
|
|
|
Zamros
Dzulkafli
|
|
|
|
|
|
|
|
|
|
|
|
NEWS
|
|
|
Outside Malaysia:
E.U: Negative interest rates could become the norm in
downturns, warns ECB. Interest rates could dive into negative territory
regularly in future economic downturns, according to a top European
Central Bank official, while ultra-low interest rates will become the
norm even in boom times. Negative rates are currently thought of as an
emergency policy to battle low economic growth and the prolonged
aftermath of the financial crisis, but economist and ECB executive board
member Benoit Coeure believes they could be here to stay. “[Negative
rates] have been very effective in supporting output and inflation and
anchoring medium-term price stability. However, they were taken on the
implicit assumption that they would be transient,” Mr Coeure told the
Jackson Hole meeting of central bankers. (Source: Bloomberg)
China: Biggest banks grind out meager profit gains as
loans sour. China’s biggest banks are grinding out meager profit gains as
they grapple with pressure from loans going bad. Agricultural Bank of
China Ltd. posted a 0.5% YoY increase in net income in the second
quarter. China Construction Bank Corp. reported earlier in the week a
0.9% YoY gain, while Bank of Communications Co.’s profit rose 1.3% YoY.
The other two lenders in the big five -- Industrial & Commercial Bank
of China Ltd. and Bank of China Ltd. -- are due to report this week. Amid
the limited profit gains, some lenders announced plans for new
fundraisings. Agricultural Bank said it would sell as much as CNY 80b
(USD 12b) of Tier-2 securities over three years, while mid-sized China
Citic Bank Corp. announced plans to raise as much as CNY 40b selling
convertible bonds. (Source: Bloomberg)
India: To seek USD 15b of investment to double mining
output. India expects to woo INR 1tr (USD 15b) of investment over five
years to double mining output and cut mineral imports. The government’s
goal is to fast-track exploration, including upfront payments for
discovered deposits when the mines are auctioned, Mines Minister Piyush
Goyal said in an interview. The administration will invite foreign
companies to participate, he said, while acknowledging challenges such as
land acquisition and environmental hurdles. “We’re working to change the
rules of the game from doing small amounts of exploration in an
incremental fashion to doing it on a fast-track, one-shot, big-picture
way,” Goyal, 52, said. There’s "easily" scope to pour INR 50b
into the search for deposits, he said. (Source: Bloomberg)
Crude Oil: Falls near USD 47/bbl as crude rig count
unchanged and Royal Dutch Shell Plc said production isn’t affected by
storm preparations in the Gulf of Mexico. Futures in New York dropped as
much as 1.2% after advancing 1.9% over the previous two sessions on
speculation informal OPEC talks next month could result in some kind of
output freeze. A tropical depression near Florida, forecast to become a
storm on Monday, is expected to move into the Gulf of Mexico, according
to the National Hurricane Center. Brent for October settlement declined
47 cents to USD 49.45/bbl on the London-based ICE Futures Europe
exchange. The global benchmark crude traded at a USD 2.36 premium to WTI.
(Source: Bloomberg)
|
|
|
|
|
|
|
Other News:
Oil & Gas: Petronas’ USD8.5b gas plan in Canada gets
boost. The Lax Kw’alaams Band aboriginal community has signalled for
openness to the project amid speculation that the location may by changed
upon opposing the current venue in British Columbia. An online message
circulated among Lax Kw’alaams members this month states that the
terminal would be placed at one of two sites farther north than
envisioned. The group is set to meet in the coming days with officials
from the Pacific NorthWest LNG project and provincial and federal
governments. (Source: The Star)
Pos Malaysia: Courier arm helps deliver higher Q1
earnings. Net profit for the first quarter ended June 30, 2016 rose 40%
YoY to MYR31.84m from MYR22.74m due to higher profits from the courier
segment, driven by demand in e-commerce and online business. Pos Malaysia
is currently focussing to transform itself into a one-stop fully
integrated logistics services provider through the soon-to-be-completed
acquisition of Kuala Lumpur Airport Services Sdn Bhd (KLAS) Group of
Companies. (Source: The Sun Daily)
Signature International: Eyes overseas market for more
orders. The Group hopes to expand its overseas reach by preparing to bid
for the provision of kitchen cabinet systems for phase 3A of the
Battersea Power project in London, which comprises 500 residential units.
The deal is estimated to be worth about MYR50m. Battersea’s main
contractor, Bouygues Construction has yet to officially open the tender.
(Source: The Edge Financial Daily)
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