| | 
| |
| |
| |
| | | | | | | | | | | | | | Share Price: | MYR1.25 | Target Price: | MYR1.29 | Recommendation: | Hold | | |
|
|
| | | Acquisition spree continues (BPLANT MK, CP MYR1.25, HOLD, TP MYR1.29, Plantations) | | While BPlant has yet to complete the Dutaland estate acquisition, it has proposed another Sabah land acquisition for MYR433m cash. Details are scant at the moment. Our preliminary estimates value the deal at ~MYR69,000 per (gross) hectare, which does not appear to be attractive at first glance. We believe BPlant will need to monetize more of its existing estate to fund this deal. Pending details, we make no changes to earnings estimates. Maintain HOLD and RNAV-based TP of MYR1.29. | | |
|
| | FYE Dec (MYR m) | FY16A | FY17A | FY18E | FY19E | Revenue | 707.9 | 760.1 | 778.1 | 788.0 | EBITDA | 188.4 | 230.2 | 223.5 | 222.7 | Core net profit | 81.5 | 134.7 | 123.1 | 129.3 | Core EPS (sen) | 3.6 | 6.0 | 5.5 | 5.8 | Core EPS growth (%) | 157.7 | 65.3 | (8.6) | 5.0 | Net DPS (sen) | 10.4 | 13.9 | 4.4 | 4.4 | Core P/E (x) | 34.4 | 20.8 | 22.7 | 21.6 | P/BV (x) | 1.3 | 1.1 | 1.1 | 1.1 | Net dividend yield (%) | 8.3 | 11.1 | 3.5 | 3.5 | ROAE (%) | 10.4 | 28.1 | 4.8 | 5.0 | ROAA (%) | 2.5 | 4.4 | 4.3 | 4.4 | EV/EBITDA (x) | 17.0 | 12.3 | 12.1 | 12.1 | Net debt/equity (%) | 21.5 | 4.8 | net cash | net cash |
| |
| | | |
| | | | | | | | | | | | Share Price: | MYR20.18 | Target Price: | MYR20.20 | Recommendation: | Hold | | |
|
|
| | | 1Q18: In line | | 1Q18 results were within expectations. A&P expense was seasonally higher in 1Q18, possibly driven in part by higher spending ahead of the World Cup Event in June 2018. 2018 looks to be relatively a better year for the brewers in general, taking cue from uptick in consumer sentiment (MIER CSI) and World Cup 2018 to help support volumes. Valuations are however fair for now at 20.7x CY19 PER, above its 5-year mean of 19.3x. We make no changes to earnings forecasts, DCF-TP of MYR20.20 and HOLD call. | | |
|
| | FYE Dec (MYR m) | FY16A | FY17A | FY18E | FY19E | Revenue | 2,810.3 | 1,930.0 | 1,987.9 | 2,018.0 | EBITDA | 620.4 | 417.5 | 427.6 | 434.7 | Core net profit | 427.3 | 270.1 | 287.3 | 294.1 | Core EPS (sen) | 141.4 | 89.4 | 95.1 | 97.3 | Core EPS growth (%) | 99.5 | (36.8) | 6.4 | 2.4 | Net DPS (sen) | 145.0 | 90.0 | 93.0 | 95.0 | Core P/E (x) | 14.3 | 22.6 | 21.2 | 20.7 | P/BV (x) | 15.5 | 16.9 | 16.2 | 15.7 | Net dividend yield (%) | 7.2 | 4.5 | 4.6 | 4.7 | ROAE (%) | 111.2 | 71.7 | 78.0 | 76.9 | ROAA (%) | 57.1 | 32.4 | 35.4 | 38.0 | EV/EBITDA (x) | 8.1 | 13.9 | 14.3 | 14.1 | Net debt/equity (%) | 17.8 | 24.9 | 9.1 | 5.1 |
| |
| | | |
| | SECTOR RESEARCH | | | | | | April stockpile lowest in 7 months | NEUTRAL
by Chee Ting Ong |
|
|
|
| | | | | | April stockpile beats street estimates on lower-than-expected April output while exports were boosted by CPO duty free exemption. Also, domestic consumption received a lift from Ramadhan demand. High fossil fuel prices, now at parity to palm oil, will provide a cushion for palm oil prices ahead of the upcoming peak production months in 3Q18. We maintain our NEUTRAL call on the sector with selected BUYs on IOI, FR, GENP, SOP, and BAL | |
| |
| | | | |
|
| | MACRO RESEARCH | | | | | | GE14 - Setting up Government after orderly transition
by Suhaimi Ilias |
|
|
|
| | | | | | PM Tun Dr. Mahathir Mohamad announced the appointment of three Senior Ministers for 3 of 10 core Ministries i.e. Finance, Defence, Home Affairs. The names for remaining 7 core Ministers will be unveiled this week. A Team of Eminent Persons was also set up to assist and advice the Cabinet. The formation of the Team of Eminent Persons reflects the balancing act in ensuring balance between experienced hands and fresh names in the Government, in our view. | |
| |
| | | | |
| | | | | | GE14 - Malaysia votes for change
by Chew Hann Wong |
|
|
|
| | | | | | GE14 ended with a historic change in Government as Pakatan Harapan gained the simple majority. We maintain our 2018 +5.3% GDP growth forecast for now pending details on the new Government's economic policies, and ahead of the release of 1Q 2018 real GDP. We can expect some sell-offs in Malaysia equities as the outcome of GE14 is unexpected. Catalysts are greater clarity on the implementation and long-term target/ direction of the new Government's economic policies, amongst others. | |
| |
| | | | |
| | | | | | Volatility is Your Friend
by Winson Phoon |
|
|
|
| | | | | | Contrasting cautious market views, we raise MGS outlook to mildly bullish. Wider fiscal deficit, while a valid concern, is a less likely scenario and may partially be offset by lower GG supply. Domestic bids and healthy external reserves are expected to cushion foreign outflow risks. In fact, the orderly transfer of power and setting up of the Council of Elders are market positive signals. We think the balance of risks is tilted to the positive side, and market uncertainties may fade quickly. | |
| |
| | | | |
| | | | | | OPR remains at 3.25%
by Suhaimi Ilias |
|
|
|
| | | | | | After raising the Overnight Policy Rate (OPR) by +25bps to 3.25% at its Monetary Policy Committee (MPC) meeting on 25 Jan 2018, BNM kept the OPR unchanged for the second consecutive meeting this year. The decision is to ensure continued steady growth path amid prospect of lower inflation this year. With the general election over, we maintain our view of "One and Done" on OPR this year, unless there are upside surprises to real GDP growth and inflation rate | |
| |
| | | | |
| | | | | | Interest rate up +25bps on inflation pressure
by Suhaimi Ilias |
|
|
|
| | | | | | BSP raised the overnight borrowing rate to 3.25% as inflation rate under the new CPI series (i.e. base year 2012) rose to +4.0% YoY in Jan-Apr 2018 (+4.6% YoY under the previous CPI series i.e. base year 2006). We see inflation averaging above BSP's 2%-4% target this year at +4.2% under the new CPI series (2017: +2.9%) vs +4.3% under the previous CPI series (2017: +3.2%). Therefore, maintained our view of two +25bps hikes in 2018. | |
| |
| | | | |
| | | | | | ASEAN Equities: Rebound Underway
by Nik Ihsan Raja Abdullah |
|
|
|
| | | | | | Last week, we anticipated MXSO Index to skid towards its lower support at 830 (refers to Regional Traders' Almanac dated 7 May 2018). The correction, however, was milder-than-expected as buying interest resurfaced at the 836 low. Subsequently, MXSO Index climbed back above its previous support-turned-resistance at 848, which could be seen as a precursor of more recovery ahead. | |
| |
| | | | |
|
| NEWS | | | Outside Malaysia:
U.K: Shoppers continue to tighten purse strings, Visa says. British consumers continued to rein in their spending in April, suggesting retailers saw no immediate comeback after a weather-blighted first quarter. Spending dropped 2% YoY, matching the decline in March when the Beast from the East snowstorm hit sales, Visa and IHS Markit said in a report. Spending in stores, as opposed to online, declined by 5.4% YoY, the quickest pace for six years. "The high street remained a key source of weakness amid recent reports of struggling retailers and store closures," said Annabel Fiddes, principal economist at IHS Markit. "Economic growth has slowed, and the recent revival in wage growth has so far failed to translate into improved expenditure trends." (Source: Bloomberg)
China: Credit growth beats estimates as economy maintains pace. China's broadest measure of new credit exceeded estimates and loan growth picked up, signalling that the economy remains robust into the second quarter. Aggregate financing stood at CNY1.56tr (USD246b) in April, the People's Bank of China said, exceeding the CNY1.33tr reading from March. New yuan loans stood at CNY1.18tr, versus CNY1.12tr the prior month. The broad M2 money supply rose 8.3% YoY, compared with a forecast 8.5% YoY growth. (Source: Bloomberg)
Hong Kong: Sets fastest growth pace since 2011, shrugging off Fed. Hong Kong's high-wire economy continued to defy gravity, putting aside fears of a tightening Fed to post its best quarter of growth in almost seven years. Data showed the Asian financial hub grew 4.7% YoY in the first quarter, the highest reading since June 2011 and more than a percentage point above the highest economist estimate. The world's least-affordable property prices continue to hold up, tourism and shopping have rebounded as China's economy hums along, and a bustling stock market that's set to boast one of the world's-biggest stock offerings this year is also buoying sentiment. (Source: Bloomberg)
Crude Oil: U.A.E. Sees OPEC oil capacity 'buffer' offsetting Iran sanctions. OPEC has enough spare production capacity to cushion oil markets if the U.S. re-imposes sanctions on Iran, according to United Arab Emirates Energy Minister Suhail Al Mazrouei. Three members of the Organization of Petroleum Exporting Countries -- Saudi Arabia, Kuwait and the U.A.E. – together have enough capacity, Al Mazrouei said in an interview with Bloomberg Television in Abu Dhabi. He serves this year as OPEC's president. "Don't worry about supply," Al Mazrouei told reporters later in Abu Dhabi. "I don't think there will be issues as a result of sanctions." OPEC has an adequate "buffer" of potential output, he said. (Source: Bloomberg) | |
| | | | | :
MyEG:To roll out e-payment service. Its joint venture (JV) in the Philippines, I-Pay MYEG Philippines Inc, had entered into a service level agreement with the local government of Quezon to act as the latter's electronic payment gateway service provider. Apart from tax collection, the JV will also cater to other services offered by the Quezon local government through its payment channels. (Source: The Star)
Destini: Slapped with IRB lawsuit over MYR6.58m tax bill. Destini is being sued by the Inland Revenue Board (IRB) over MYR6.58m in outstanding tax payments including penalties for the year of assessment of 2016. Destini told Bursa Malaysia that it has been served with a writ of summon and statement of claim by IRB on behalf of the Malaysian government issued by the High Court of Malaya in Shah Alam. (Source: The Sun Daily)
UEM Edgenta: Increases dividend payout ratio. UEM Edgenta will adopt a new dividend policy of at least 50% and up to 80% dividend payout ratio based on the reported consolidated net profit attributable to shareholders after non-controlling interest, with effect from the financial year ending Dec 31, 2018. This is higher than the previous dividend policy payout ratio of up to 70%.(Source: The Sun Daily) | |
| |
| | | | | Disclaimer | | | This email and its attachment(s) are confidential and are intended solely for the use of the individual to whom it is addressed. Any views or opinions expressed are solely those of the author and do not necessarily represent those of Maybank Kim Eng or any of its affiliates. Intended recipients of this email are prohibited from disseminating, forwarding, printing and/or copying its contents. If you are not the intended recipient of this email, you are strictly prohibited to take any action based upon them, which also includes dissemination, forwarding, printing and copying of its contents. Maybank Kim Eng Research sent this e-mail to you because your Notification Preferences indicate that you want to receive information about our daily research reports. If you wish to read Disclaimer in details, please click HERE. | | | To unsubscribe or change preference settings, please contact your representative HERE. | | | | |
|
|
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.