April 27, 2012

MIDF cuts MAS' target price

Stock Name: AIRPORT
Research House: MIDFPrice Call: BUYTarget Price: 6.72

MIDF Research cut its target price for Malaysia Airports Holdings Bhd to RM6.72 (US$2.20) from RM7.30 after the announcement of the airport operator's first quarter results on Thursday.

"We are adjusting our target price in conjunction with the private placement of 110 million shares which was completed in March," said the broker in a research note on Friday.

Maintaining its "buy" call on the counter, MIDF lowered its FY12 earning estimates for MAHB by 7.3 percent due to the rising staff cost and utilities fees.

"We reiterate our buy recommendation on MAHB given the steady traffic growth due to air travel boom in the region," the broker said, adding that high traffic growth in Middle East and Asia will have a strong spill-over effect on airport operators.

MIDF added that the completion of the new Kuala Lumpur International Airport 2 (KLIA2) will boost MAHB's retail and rental collections, thus improving its growth outlook.

"KLIA2 is about 54 percent completed and is on schedule. The integrated complex with floor space of 35k sqm will significantly fuel up MAHB's retail and rental collections and enhance the experience of airport users," the broker said. -- Reuters

RHB cuts Genting to 'market perform'

Stock Name: GENM
Research House: RHBPrice Call: HOLDTarget Price: 4.20

RHB Research downgraded Genting Malaysia to market perform, citing restricted share price movement due to hitches in the gaming-to-power conglomerate's expansion plans.

"We downgrade our call on Genting Malaysia to market perform (from outperform) as we believe the slower progress of legalisation and hitches encountered in its expansion plans into new geographical areas would cap share price movement at this juncture," the broker said in a research note on Friday.

RHB also cut Genting's sum-of-parts (SOP) based fair value to RM4.20 from RM4.35 after revising its discounted cash flow parameters for Malaysia and the UK.

RHB added that potential catalysts which could help re-rate the stock would be progress on the legalisation of gaming in New York and Miami and sustainable improvements in Genting UK's operations. -- Reuters

Active M &A Play

Stock Name: YSPSAH
Research House: TAPrice Call: BUYTarget Price: 1.27

Earnings Impacted by Holiday Mood

Stock Name: FIBON
Company Name: FIBON BERHAD
Research House: TAPrice Call: HOLDTarget Price: 0.45

April 26, 2012

TA downgrades SEGi to 'hold'

Stock Name: SEG
Research House: TAPrice Call: HOLDTarget Price: 1.98

TA Research downgraded SEG International Bhd (SEGi) to "hold" as it saw the offer by Navis Capital to take over the education firm as unattractive.

"Given the unattractive terms of the deal, we recommend investors to reject the offer by Navis," TA said in research note on Thursday.

The broker cut its target price for SEGi to RM1.98 per share to take into account the risk that the takeover offer will result in eventual delisting of the stock at a discounted price.

"We shall review our recommendation once there is better clarity on the outcome of the takeover offer," it added. -- Reuters

MIDF upgrades Sunway Reit to 'buy'

Stock Name: SUNREIT
Research House: MIDFPrice Call: BUYTarget Price: 1.39

MIDF Research upgraded Sunway Real Estate Investment Trust (Reit) to "buy" after the latter's latest earnings result exceeded market expectations.

"Our forecast had underestimated the growth of the hospitality segment which had surprisingly registered commendable growth in a challenging economic environment," the broker said in a research note on Thursday.

MIDF raised its target price for Sunway Reit to RM1.39 per share from RM1.36 previously, while it lifted the Reit's earnings forecast for the fiscal year ending June 30, 2012 by 6 percent.

By 10am , Sunway Reit shares rose 2.42 percent, outperforming the Malaysia's benchmark stock index that climbed 0.08 percent. -- Reuters

April 25, 2012

TH Plantations cut to 'trading sell'

Stock Name: THPLANT
Research House: MIDFPrice Call: BUYTarget Price: 3.00

MIDF Research lowered its call on Malaysia's plantation firm TH Plantations Bhd to "trading sell" from "neutral" on the back of lower earnings due to higher labour and fertilizer costs.

In a research note on Wednesday, MIDF said higher costs and lower crude palm oil (CPO) prices dragged down TH Plantations' earnings in the first quarter this year by 40 percent on year, and as much as 65 percent on quarter to RM13.07 million (US$4.26 million).

MIDF cut its FY12 and FY13 earnings forecast for the planter by 41 percent and 33 percent respectively on lower profit margin assumptions.

"We do not expect TH Plant's earnings to recover swiftly in subsequent quarters in FY12 as crude palm oil price is downtrending and production is expected to stay flat," the broker said.

MIDF also revised its target price for the company to RM2.12 from RM3.00.

As of 10.05am Malaysian time, TH Plantations' shares fell 1.07 percent. -- Reuters