Company Name: WCT BHD
| Research House: HLG | Price Call: BUY | Target Price: 2.98 |
Stock Name: MRCB
Company Name: MALAYSIAN RESOURCES CORP
| Research House: HLG | Price Call: BUY | Target Price: 2.64 |
Stock Name: JCY
Company Name: JCY INTERNATIONAL BERHAD
| Research House: HLG | Price Call: HOLD | Target Price: 1.33 |
WCT (BUY)
The first for FY2012
'''' WCT has been awarded a contract to design and construction the new Ministry of International Trade & Industry (MITI) HQ at Jalan Khidmat Usaha by Putrajaya Management S/B for RM300.5m. Works are expected to be completed in Feb 2015.
'''' After a barren spell last year, WCT has finally clinched a meaningful project. We understand that the new MITI HQ was supposed to be awarded last year, and has finally come to fruitation. Overall, WCT's outstanding order book has been lifted to ~RM2.7bn, translating to ~1.7x FY10's construction revenue and ~1.3x order book-to-market cap ratio.
'''' Maintain BUY call with TP of RM2.98 based on 14x average FY11 and FY12 earnings.
''
MRCB (BUY)
FY11 lifted by KL Sentral developments
'''' Reported FY11 earnings grew by 15% to RM77.5m (5.59 sen/share). However, after adjusting for EI of RM5.29m, core earnings came in at RM77.2m (5.21 sen/share), missing our estimates slightly by 6% but off consensus' mark by 16%. Nonetheless, FY11's core earnings growth was still decent at 7%, lifted by strong performance in the property division.
'''' 4Q marks the second consecutive quarterly EBIT losses for the construction division. We understand that the losses occurred due VOs which is pending approval. Hence, once the VOs are approved, there should be lumpy earnings recognition for the division going forward. We are not overly concerned as it is a timing issue in profit recognition. On the other hand, the property division saw tremendous growth, underpinned by the maturing KL Sentral developments.
'''' Forecasts under review pending analyst briefing. Maintain BUY call with TP of RM2.64 based on SOP valuation.
''
JCY International (HOLD)
1QFY12 Results
'''' 1QFY12 core net profit of RM164.9m exceeded our expectations, accounting for 42% of our full-year forecast and 71.6% of street's estimates.
'''' JCY registered a revenue of RM599 (+27.4% yoy, +27.1% qoq), EBITDA of RM190.6m (+434.7% yoy, +362.7% qoq), PAT of RM162.5m (+2,063% yoy, +514.4% qoq)
'''' JCY's performance was 8.3% better than profit guidance issued in January, attributable to increase in orders, higher ASP, effective product mix, favorable exchange rate and continuous cost management.
'''' JCY managed to capture 25% of HDD component market after the Thai flood as it saw orders from Seagate almost doubled. As a result, JCY achieve better economy of scale and scope (product mix) while achieving above 80% utilization rate.
'''' The firm acknowledged the challenges in acquiring talent and human resources and may be a bane to its growth.
'''' We have revised our profit forecast marginally after revising our cost models. As a result, FY12 and FY13 EPS are revised by +12.3% and -3.2% respectively.
'''' Following the revision in earnings forecasts, target price has been raised to RM1.33 from RM1.26
''
KLCI: To retest 1570 zones after the 1550 breakout
'''' Renewed buying interest on index-linked stocks after recent consolidation and persistent active retail participation on lower liners, ACE and penny stocks are expected to sustain KLCI rally in the short term, in anticipation of positive progress on Greece debt talk, acceleration in ETP projects rollout, continuous funds inflows and stronger global manufacturing data.
'''' Immediate supports are 1542 (upper Bollinger band) and 1530 (31 Dec 11) whilst resistances are the upper channel near 1570-1580 zones.
AMMB: To retest 200-d SMA
'''' ''Currently, the momentum and trend indicators are on the mend and AMMB is consolidating upwards along the uptrend line formed since Sep 11 low. Following the triangle breakout, AMMB could test higher ground over the next few sessions with immediate resistance at RM6.15 (200-d SMA).
'''' A more bullish outlook would only appear if share price manages to close consistently above the 200-d SMA. The next upside targets are RM6.23 (50% FR) and RM6.46 (38.2% FR).
'''' ''Immediate supports are RM5.86 (100-d SMA), RM5.82 (mid Bollinger band) and RM5.71 (lower Bollinger band). Cut loss below RM5.71.''
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