Stock Name: NOTION
Company Name: NOTION VTEC BHD
Company Name: NOTION VTEC BHD
| Research House: OSK | Price Call: HOLD | Target Price: 1.77 |
February 13, 2012
Citech closure to deliver 4QFY11 loss
Stock Name: TGOFFS
Company Name: TANJUNG OFFSHORE BHD
Company Name: TANJUNG OFFSHORE BHD
| Research House: AMMB | Price Call: SELL | Target Price: 0.71 |
Another Challenging Year
Stock Name: CSCSTEL
Company Name: CSC STEEL HOLDINGS BERHAD
Company Name: CSC STEEL HOLDINGS BERHAD
| Research House: OSK | Price Call: TRADING BUY | Target Price: 1.60 |
MRT, IPOs to Boost Sentiment
Stock Name: MMCCORP
Company Name: MMC CORPORATION BHD
Company Name: MMC CORPORATION BHD
| Research House: OSK | Price Call: TRADING BUY | Target Price: 3.70 |
February 10, 2012
HLIB Research 10 February 2012 (MRCB; Econs; Traders Brief)
Stock Name: MRCB
Company Name: MALAYSIAN RESOURCES CORP
Company Name: MALAYSIAN RESOURCES CORP
| Research House: HLG | Price Call: BUY | Target Price: 2.50 |
MRCB (BUY)
KL Sentral to support growth
'''' Following yesterday's briefing, we walked away reassured that the company's fundamentals are still strong underpinned by the maturing KL Sentral development.
'''' VOs as much as RM20m should be recognised by FY12, hence an earnings boost for the construction division. However, the division is expected to post EBIT margins of 3-4% going forward as opposed to 7-9% achieved previously. This is due to the intense bidding for the RM1.4bn LRT Ampang Line Package B project. Overall, outstanding order book remains strong at ~RM2.2bn, translating to 3.3x FY11 construction/environmental revenue.
'''' Lot G offices, Aloft Hotel, QSentral (70% take-up) and Sentral Residences (50% take-up/bookings) will continue to drive the property division's earnings. Overall, unbilled property sales stood at ~RM1.68bn, translating to 3.5x FY11 property revenue.
'''' We estimate that FY12 earnings will be impacted by higher financing charges arising from the EDL highway. Hence, we slash our FY12 forecast, while introducing FY14 earnings estimates. That said, it should not impact our valuations as MRCB is valued based on SOP method.
'''' We maintain our BUY call on MRCB for the unique qualities of KL Sentral to support earnings growth, but with a lower TP of RM2.50.
''
''
Performance of IPI (Dec 2011)
'''' IPI growth picked up to 3.0% yoy in Dec (Nov:'' +2.4% yoy), higher than consensus estimate of +1.7%, driven by improvement in electricity and mining segment.
'''' E&E production declined further by 7.4% yoy (Nov: -2.8%) driven by weakness in all product segments, with severe output drop in printed circuit board segment.
'''' Contraction in mining output narrowed to only -0.8% yoy in Dec, reducing its drag on the overall IPI performance.
'''' Maintain our full year 2011 GDP estimate at 5.1%, factoring in 4Q estimate of 5.0%. Also maintain our 2012 GDP growth forecast at 4.5% as we expect resilient domestic demand to cushion the softer industrial sector.
'''' We expect BNM to hold the OPR steady at 3.00% until end-2012 given the resilient economic growth with sticky inflation.
''
Softening in December Export Growth
'''' Export growth moderated further to 6.1% yoy in Dec (Nov: +8.0% yoy), the slowest since June 2011, while import growth bucked the trend, picking up for the second consecutive month to 10.4% yoy (Nov: +8.4% yoy).''
'''' Trade surplus narrowed to RM8.3bn (Nov: RM9.5bn), as import growth significantly outpaced export expansion.
'''' Contribution of palm oil diminished drastically, with export growth slowing sharply to 8.4% yoy in Dec, a sharp slowdown compared to an average growth of 43.2% during Jan-Oct 2011.
'''' Further pick-up in import growth with intermediate imports rising by 7.7% yoy suggests that manufactured exports could remain stable in the coming months.
'''' We expect January's export growth to show temporary contraction due to festivity and seasonality.
'''' MITI announced its official export growth forecast of 5-6% for 2012. Our export growth projection is slightly lower at 4.5%, which is in line our overall GDP outlook.
'''' Maintain our 2012 GDP growth forecast at 4.5% as we expect resilient domestic demand to cushion the softer industrial sector.
''
KLCI: Momentum to remain strong to retest 1570-1580 zones''''''
'''' Despite surging 3.9% from YTD low of 1509 (6 Jan) to 1565 yesterday, technical indicators are bullish and overall market momentum (with the rotational plays on bigcaps, 2nd & lower liners and penny stocks) remains positive to climb higher towards the resistance targets at 1570-1580 territory.
'''' In our view, any profit taking activities are likely to be well-absorbed near supports at 1551 (upper Bollinger band) and 1531 (10-d SMA).''
''
Dow Jones: Dow ekes out 7 pts gain in a choppy trade''''''
'''' Overall, after surging from Oct 11's low at 10404, investors were cautious after months of continuous gains as the market is approaching an overbought position amid rising RSI.
'''' However, we are encouraged by the continuous improvement in US economic news which show that the country is not as handicapped to what's going on in Europe as in the past.'' In our view, any pullback will attract investors who missed the rally, limiting the decline near supports of 10-d SMA (12695) and 20-d SMA (12582).
Malaysia Airline System: Maintain Hold - 4Q11: Brace for a hard landing
Stock Name: MAS
Company Name: MALAYSIAN AIRLINE SYSTEM BHD
Yields, fuel and slow motivation. 4Q11 is expected to be severely loss-making due to the impact of a 38% higher fuel price YoY and a weak yield environment. We have been monitoring MAS' fares and notice that it is lower than those of competitors by a wide margin. We maintain our Hold call with a target price of RM1.55, pegged to 6.6x 2012 adjusted EV/EBITDAR - on par with Asia Pacific airline peers.
Maybank Research 10 Feb 2012
Click here for full report
Company Name: MALAYSIAN AIRLINE SYSTEM BHD
| Research House: MAYBANK | Price Call: HOLD | Target Price: 1.55 |
Yields, fuel and slow motivation. 4Q11 is expected to be severely loss-making due to the impact of a 38% higher fuel price YoY and a weak yield environment. We have been monitoring MAS' fares and notice that it is lower than those of competitors by a wide margin. We maintain our Hold call with a target price of RM1.55, pegged to 6.6x 2012 adjusted EV/EBITDAR - on par with Asia Pacific airline peers.
Maybank Research 10 Feb 2012
Click here for full report
Sunway REIT: Maintain Buy - Growing its asset size inorganically
Stock Name: SUNREIT
Company Name: SUNWAY REAL ESTATE INVT TRUST
Above expectations; TP raised. SunREIT's reported 1HFY12 realised net profit of RM95m (+14.3% YoY) was slightly above our expectations but within consensus estimates. The earnings variance was attributed to better-than-expected performance from Sunway Putra Place (SPP). 2Q DPU declared of 2.0sen also beat our estimates. We adjust our FY12-14 earnings forecasts by -2% to +2%. Our new DCF-based target price is RM1.38, translating into a 13% total return.
Maybank Research 10 Feb 2012
Click here for full report
Company Name: SUNWAY REAL ESTATE INVT TRUST
| Research House: MAYBANK | Price Call: BUY | Target Price: 1.38 |
Above expectations; TP raised. SunREIT's reported 1HFY12 realised net profit of RM95m (+14.3% YoY) was slightly above our expectations but within consensus estimates. The earnings variance was attributed to better-than-expected performance from Sunway Putra Place (SPP). 2Q DPU declared of 2.0sen also beat our estimates. We adjust our FY12-14 earnings forecasts by -2% to +2%. Our new DCF-based target price is RM1.38, translating into a 13% total return.
Maybank Research 10 Feb 2012
Click here for full report
Bursa Malaysia: Maintain Hold - No surprises in 2011 final results
Stock Name: BURSA
Company Name: BURSA MALAYSIA BHD
Maintain Hold. RM146m 2011 net profit (+29% YoY) made up 98% of our and 101% of consensus estimates. We marginally tweak forecasts, expecting a slower 11% growth in 2012 profit with continuous volatility to support equity and derivative trading activities. We lift our sum-of-parts based target price by 7% to RM7.00, pegging Bursa at 20x 2012 PER (18x previously) which is at a 20% discount to our target for SGX SP plus excess cash (94sen/sh). We expect Bursa to retain its 95% net profit payout translating into a 3.8% net yield for 2012.
Maybank Research 10 Feb 2012
Click here for full report
Company Name: BURSA MALAYSIA BHD
| Research House: MAYBANK | Price Call: HOLD | Target Price: 7.00 |
Maintain Hold. RM146m 2011 net profit (+29% YoY) made up 98% of our and 101% of consensus estimates. We marginally tweak forecasts, expecting a slower 11% growth in 2012 profit with continuous volatility to support equity and derivative trading activities. We lift our sum-of-parts based target price by 7% to RM7.00, pegging Bursa at 20x 2012 PER (18x previously) which is at a 20% discount to our target for SGX SP plus excess cash (94sen/sh). We expect Bursa to retain its 95% net profit payout translating into a 3.8% net yield for 2012.
Maybank Research 10 Feb 2012
Click here for full report
MRCB - Highlights from analyst briefing
Stock Name: MRCB
Company Name: MALAYSIAN RESOURCES CORP
Malaysian Resources Corp; Buy; RM2.19
Price Target: RM3.10; MRC MK
4Q11 included provision for variation orders (VOs) for some construction projects amounting to RM20m. MRCB believe there is strong grounds for claim and a potential write back in 2012 is possible. We understand construction margins for FY11 would be 4% excluding VOs instead of the 1.9% reported.
2012 bottomline growth could be impacted by:- i) higher tax rate as it has utilised most of its tax losses; ii) higher minority interest from Lot D and Lot B; and iii) start up losses and higher interest cost for Eastern Dispersal Link (EDL). However, pretax profit growth should still be decent. We are currently looking at RM107m net profit for FY12F (+38% growth) which is below consensus of RM118m. However, we may look to revise our numbers pending more clarity for EDL and when its KPIs are disclosed in March.
EDL may start tolling in May pending cabinet approval. Based on this, the expected budgeted loss is RM30m to RM40m for FY12F but will be profitable in FY13F assuming traffic volume remains consistent at 70,000 to 80,000 vehicles per day. There will also be higher interest cost as MRCB will unlikely be able to capitalise interest cost going forward (RM7.5m per month) as the project has been completed.
MRCB is still exploring launching a REIT but thinks if it happens in 2012 it will be via injecting its properties into an existing REIT. Lot E has achieved 70% tenancy with average rental rates of RM8.50 psf for office and RM5.50psf for retail. Lot 348 will be delayed up to a maximum of 6 months (realistically one month) but potential LADs may be absorbed by budgeted savings of RM38m from the construction.
With construction flows remaining strong, MRCB has targets to bag at least RM1bn worth of new works in FY12F. It will continue to bid for MRT elevated works, LRT extensions, River of Life projects and environmental projects. On the RM1.3bn LRT contract clinched in 2011, RM450m will be done internally while for the balance MRCB has option to either earn a project fee of 1-2% or participate in the tenders.
Margin guidance for civil works is 3-4%. We maintain our Buy rating and SOP-derived TP of RM3.10. Key catalysts include:- i) potential participation in the RRIM due to its strong parentage; ii) more construction wins; iii) approval for Penang Sentral in 2012 and receiving an official approval for another similar type of project in another state.
Source: HwangDBS Research 10 Feb 2012
Company Name: MALAYSIAN RESOURCES CORP
| Research House: HWANGDBS | Price Call: BUY | Target Price: 3.10 |
Malaysian Resources Corp; Buy; RM2.19
Price Target: RM3.10; MRC MK
4Q11 included provision for variation orders (VOs) for some construction projects amounting to RM20m. MRCB believe there is strong grounds for claim and a potential write back in 2012 is possible. We understand construction margins for FY11 would be 4% excluding VOs instead of the 1.9% reported.
2012 bottomline growth could be impacted by:- i) higher tax rate as it has utilised most of its tax losses; ii) higher minority interest from Lot D and Lot B; and iii) start up losses and higher interest cost for Eastern Dispersal Link (EDL). However, pretax profit growth should still be decent. We are currently looking at RM107m net profit for FY12F (+38% growth) which is below consensus of RM118m. However, we may look to revise our numbers pending more clarity for EDL and when its KPIs are disclosed in March.
EDL may start tolling in May pending cabinet approval. Based on this, the expected budgeted loss is RM30m to RM40m for FY12F but will be profitable in FY13F assuming traffic volume remains consistent at 70,000 to 80,000 vehicles per day. There will also be higher interest cost as MRCB will unlikely be able to capitalise interest cost going forward (RM7.5m per month) as the project has been completed.
MRCB is still exploring launching a REIT but thinks if it happens in 2012 it will be via injecting its properties into an existing REIT. Lot E has achieved 70% tenancy with average rental rates of RM8.50 psf for office and RM5.50psf for retail. Lot 348 will be delayed up to a maximum of 6 months (realistically one month) but potential LADs may be absorbed by budgeted savings of RM38m from the construction.
With construction flows remaining strong, MRCB has targets to bag at least RM1bn worth of new works in FY12F. It will continue to bid for MRT elevated works, LRT extensions, River of Life projects and environmental projects. On the RM1.3bn LRT contract clinched in 2011, RM450m will be done internally while for the balance MRCB has option to either earn a project fee of 1-2% or participate in the tenders.
Margin guidance for civil works is 3-4%. We maintain our Buy rating and SOP-derived TP of RM3.10. Key catalysts include:- i) potential participation in the RRIM due to its strong parentage; ii) more construction wins; iii) approval for Penang Sentral in 2012 and receiving an official approval for another similar type of project in another state.
Source: HwangDBS Research 10 Feb 2012
BURSA - Sustainable momentum is key
Stock Name: BURSA
Company Name: BURSA MALAYSIA BHD
Bursa Malaysia; Fully Valued; RM7.52
Price target: RM6.00 (Prev RM5.20); BURSA MK
FY11 net profit of RM146m was in line. Declared 13 sen final DPS; 95% payout for FY11. Maintain Fully Valued; raised TP to RM6.00.
Source: HwangDBS Research 10 Feb 2012
Company Name: BURSA MALAYSIA BHD
| Research House: HWANGDBS | Price Call: SELL | Target Price: 6.00 |
Bursa Malaysia; Fully Valued; RM7.52
Price target: RM6.00 (Prev RM5.20); BURSA MK
FY11 net profit of RM146m was in line. Declared 13 sen final DPS; 95% payout for FY11. Maintain Fully Valued; raised TP to RM6.00.
Source: HwangDBS Research 10 Feb 2012
Subscribe to:
Posts (Atom)