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| | | | | | | | | | | | | | Share Price: | MYR1.10 | Target Price: | MYR1.08 | Recommendation: | Hold | | |
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| | | A new century begins | | Century Logistics is one of the largest logistics operators in Malaysia. In the medium to long term, it offers exposure to parcel delivery, which will ride on the growing importance of e-commerce. Initiate coverage at HOLD and DCF-based TP of MYR1.08 (WACC: 8.9%, LT growth: 2.0%). | | |
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| | FYE Dec (MYR m) | FY15A | FY16A | FY17E | FY18E | Revenue | 297.9 | 300.3 | 295.3 | 338.4 | EBITDA | 54.6 | 37.9 | 34.9 | 37.2 | Core net profit | 22.0 | 22.5 | 16.0 | 17.6 | Core EPS (sen) | 5.8 | 5.8 | 4.1 | 4.5 | Core EPS growth (%) | (10.3) | 0.8 | (28.7) | 9.7 | Net DPS (sen) | 5.5 | 3.5 | 1.0 | 1.1 | Core P/E (x) | 19.1 | 19.0 | 26.6 | 24.3 | P/BV (x) | 1.5 | 1.4 | 1.4 | 1.3 | Net dividend yield (%) | 5.0 | 3.2 | 1.0 | 1.0 | ROAE (%) | 10.8 | 6.9 | 5.2 | 5.5 | ROAA (%) | 5.2 | 5.2 | 3.6 | 3.6 | EV/EBITDA (x) | 5.7 | 8.3 | 11.3 | 13.4 | Net debt/equity (%) | net cash | net cash | net cash | 22.2 |
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| | | | | | | | | | | | Share Price: | MYR1.21 | Target Price: | MYR1.35 | Recommendation: | Buy | | |
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| | | Disposes QB8 | | We are neutral on MQREIT's proposed disposal of its industrial property which has decent occupancy rate but the disposal enables MQREIT to channel its resources into existing and future office assets. Earnings impact is marginal. We nudge down our FY18-19 earnings estimates by <1.0% p.a. but maintain our DDM-TP of MYR1.35 (cost of equity: 7.5%). | | |
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| | FYE Dec (MYR m) | FY15A | FY16A | FY17E | FY18E | Revenue | 115.2 | 131.8 | 185.1 | 186.3 | Net property income | 90.3 | 102.3 | 137.3 | 140.2 | Distributable income | 54.0 | 59.2 | 90.4 | 94.2 | DPU (sen) | 6.9 | 7.5 | 7.4 | 7.6 | DPU growth (%) | (8.1) | 8.8 | (2.0) | 3.2 | Price/DPU(x) | 17.5 | 16.0 | 16.4 | 15.9 | P/BV (x) | 0.9 | 0.6 | 1.0 | 1.0 | DPU yield (%) | 5.7 | 6.2 | 6.1 | 6.3 | ROAE (%) | 8.4 | 5.6 | 6.6 | 6.9 | ROAA (%) | 4.3 | 3.0 | 3.9 | 4.1 | Debt/Assets (x) | 0.4 | 0.4 | 0.4 | 0.4 |
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| | MACRO RESEARCH | | | | | | KLCON INDEX: V-Shape Recovery
by Nik Ihsan Raja Abdullah |
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| | | | | | FBMKLCI rose 14.18pts to 1,832.15 yesterday, led by gains in PTG, YTL and TM. Market breadth was bullish with gainers outpacing losers by 853 to 312. A total of 6.96b shares worth MYR4.59b changed hands. Expect rotational play among the blue chips but trading could be volatile due to profit taking, mirroring the lackluster US markets. O&G stocks and importers will continue to gain traction amid higher oil price and a stronger MYR. | |
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| NEWS | | | Outside Malaysia:
U.S: Consumer credit jumped in November by most since 2001 as credit-card balances surged, Federal Reserve data showed. Total credit rose USD28b or at an 8.8% annualized rate after a USD20.5b gain. Revolving credit outstanding increased USD11.2b, the most in a year. Non-revolving debt outstanding climbed USD16.8b, the biggest gain since Oct. 2016. The acceleration in revolving debt shows Americans' credit- card balances were mounting during the holiday-shopping season. The increase in non-revolving credit outstanding probably reflects more motor vehicle purchases. While household wealth is climbing on the heels of higher home prices and record stock values, the risk to the economy is that consumers with fewer assets may have to temper their spending until debt loads become more manageable. (Source: Bloomberg)
E.U: Confidence in the euro area continued its advance at the end of 2017, capping what was probably the strongest year for the economy in a decade. The European Commission's measure of sentiment touched it's highest since late 2000 in December. The reading of 116 was based on an improvement in the outlook for industry and services. (Source: Bloomberg)
Germany: Factory orders fell in November as demand for investment goods dropped, though the Economy Ministry said the trend remains upward. Orders, adjusted for seasonal swings and inflation, slid 0.4% after a revised 0.7% gain in October, the ministry said. While the decrease snapped three month of gains, the number is typically volatile and orders were up 8.7% YoY. (Source: Bloomberg) | |
| | | | | Other News:
Ajiya: Signs MoU with SPNB to collaborate on housing projects. Ajiya has entered into a Memorandum of Understanding with Syarikat Perumahan Negara Bhd (SPNB) to implement Ajiya's Green Integrated Building Solutions in the development of housing projects under SPNB Group. (Source: The Star)
Yong Tai: Gets MYR100m loan from Bank of China to build Encore Melaka theatre. The group has secured MYR100m worth of financing from Bank of China for the construction of the Encore Melaka theatre at the group's Impression City mixed development in Melaka. Yong Tai said MYR90m of the loan will be used to finance the construction of the theatre, which cost between MYR300m and MYR400m. The remaining MYR10m will be used for initial operational expenses. (Source: The Edge Financial Daily)
SCH: Proposes private placement to raise MYR19m. The group is seeking to raise MYR19.06m through private placement to raise fresh capital for future acquisition, which the company has yet to confirm. The size of the private placement — to be issued in tranches — is of up to 103m new shares which is equivalent to about a quarter of SCH's existing share base of 412.24m shares. SCH expects the private placement exercise to be completed by June this year. (Source: The Edge Financial Daily)
MESB: Unit now licensee for men's 'Crocodile' products in Malaysia. Its wholly-owned unit Miroza Leather S/B has entered into a licence agreement with Crocodile International S/B (CISB), whereby CISB grants Miroza the exclusive licence to use the 'Crocodile' trademark for the design, manufacture, advertisement, distribution, sale and promotion of the items. The licence is for a period of two years and 11 months commencing 1 Feb, 2018 to 31 Dec, 2020, which will be renewed for another two years, commencing Jan, 2021. (Source: The Edge Financial Daily) | |
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