r e t a i l m a r k e t m o n i t o r wednesday, 30 ... · 12/2/2016 · r e t a i l m a r k e t m...

R e t a i l M a r k e t M o n i t o r Wedn esd ay , 30 N ovem be r 20 16

w w w . u t r a d e . c o m . m y 1

M A L A Y S I A

MARKET NEWS

The FBMKLCI fell 1.73pt to close at 1,626.93 yesterday, tracking losses in regional

markets. Meanwhile, Asian stocks slipped as investors weighed Donald Trump’s stimulus

plans against threats to markets from Italy’s referendum. The MSCI Asia Pacific Index slid

0.1% to 136.47, led by telecom and technology shares. The FBMKLCI’s top gainers were

Axiata Group (+2.6%), Malayan Banking (+1.8%) and Digi.Com (+0.8%) while the top

losers were SapuraKencana Petroleum (-2.1%), PPB Group (-1.6%) and Telekom

Malaysia (-1.6%). In the broader market, losers outpaced gainers 543 to 214 with 342

counters unchanged. Turnover was 1.38b shares valued at RM1.72b.

Given that selling pressure still persists, the FBMKLCI has succumbed and closed in

negative territory yesterday as the index closed below 21-day EMA line yet again after

hovering higher in past two days. Following global political uncertainties and a lack of

domestic-driven catalysts, we expect the FBMKLCI to move sideways. However, lingering

selling pressure may drag the index lower in the near term. Support and resistance levels

are still maintained as follows:

Support: 1,612,1,600

Resistance: 1,665, 1,680

US stocks on Tuesday closed higher, as gains in the healthcare, financials and utilities

sectors led shares higher. The DJIA gained 23.70pt, or 0.12%, to close at 19,121.60 while

the S&P500 edged higher by 2.94pt, or 0.13%, to close at 2,204.66. On the economic

front, the second reading of the US 3Q16 GDP showed an expansion at an annualised

3.2%, the fastest pace in over two years while a measure of consumer confidence soared

in November to pre-recession levels. Falling stocks outnumbered advancing ones on the

NYSE by 1,688 to 1,471 and 95 ended unchanged.

WHAT’S IN THE PACK

Alliance Financial Group (AFG MK/HOLD/RM3.72/Target: RM3.80)

2QFY17: Net profit in line, driven by

strong cost discipline and wealth

management income. Management

alludes to a weaker 2HFY17 due to lower

recoveries and a sluggish growth

environment.

UMW Holdings (UMWH MK/SELL/RM4.87/Target: RM4.00)

3Q16: Below expectations.

Underperformance stemmed from higher-

than-expected losses from its 55.7%-

owned UMW O&G and others segment.

Outlook remains bleak.

Goodway Integrated Industries

(GII MK) Technical BUY on breakout with +18.3%

potential return

BUY on breakout with a target price of

RM0.775 and stop-loss at RM0.585. Based

on the daily chart, the share price managed

to close above the BBI line and we expect

GII to continue the upward movement

towards the breakout level of RM0.655.

Saudee Group (SAUD MK) Technical BUY on breakout with +27.4%

potential return


RM0.395 and stop-loss at RM0.27. After

the earlier correction, share price has

rebounded and moved above the BBI line,

implying the correction is over.

ML Global (MLG MK) Technical BUY with +19.9% potential return

BUY with a target price of RM0.995 and

stop-loss at RM0.765. Yesterday’s

movement had triggered a BUY on the

back of a positive closing above the BBI

line, a growing bullish divergence in DMI

and a golden crossover in the MACD.

FBMKLC I CHART

Source: Bursa Station

KEY IND ICES

Prev Close Chg (%)

YTD (%)

DJIA 19,121.60 0.12 9.74 S&P 500 2,204.66 0.13 7.86 FTSE 100 6,772.00 (0.40) 8.49 CSI 300 3,564.04 0.82 (4.48) FSSTI 2,879.14 0.16 (0.12) HSCEI 9,846.21 (0.30) 1.92 HSI 22,737.07 (0.41) 3.75 JCI 5,136.67 0.43 11.84 KLCI 1,626.93 (0.11) (3.87) KOSPI 1,978.39 0.01 0.87 Nikkei 225 18,307.04 (0.27) (3.82) SET 1,497.18 (0.24) 16.24 TWSE 9,192.38 (0.32) 10.25 BDI 1,202.00 1.52 151.46 CPO (RM/mt) 3,050.00 (0.88) 22.74 Nymex Crude (US$/bbl) 45.31 0.18 2.49

TOP VOLUME

Stock Price (RM)

Chg (%)

Vol (‘000)

Airasia X Bhd 0.36 (4.05) 58,079

Sumatec Resources Bhd

0.05 (9.09) 34,618

Apft Bhd 0.06 (7.69) 24,744 Rgb International Bhd 0.24 2.13 20,854

Green Packet Bhd 0.28 0.00 20,210

TOP GA INERS

Stock Price (RM)

Chg (%)

Vol (‘000)

Maxwell International Holdings

0.02 33.33

1

China Automobile Parts Holding

0.03 25.00

240 Silver Ridge Holdings Bhd

0.13 25.00

56

Lion Diversified Holdings Bhd

0.03 20.00

50 Seremban Engineering Bhd

0.30 13.21

128

TOP LOSERS

Stock Price (RM)

Chg (%)

Vol (‘000)

Melewar Industrial Group Bhd

0.40 (24.76) 16,189.2 Idimension

Consolidated Bhd 0.04 (20.00) 345.0

Key Asic Bhd 0.07 (18.75) 953.0 Mlabs Systems Bhd 0.07 (17.65) 14.9

Mms Ventures Bhd 0.54 (14.29) 4,872.6 Source: Bloomberg



M A L A Y S I A

TRADERS’ CORNER

Goodway Integrated

Industries (GII MK) Technical BUY on breakout with +18.3%

potential return

Last price : RM0.63

Target price : RM0.73, RM0.775

Support : RM0.59

Stop-loss : RM0.585


RM0.775 and stop-loss at RM0.585. Based

on the daily chart, the share price managed

to close above the BBI line and we expect

GII to continue the upward movement

towards the breakout level of RM0.655.

This bullish movement is supported by the

RSI which is currently showing a positive

signal. This is also consistent with the

bullish crossover in the DMI, which

suggests stronger buying momentum

ahead.

Expected time frame: 2 weeks to 2

months

Saudee Group (SAUD MK) Technical BUY on breakout with +27.4%

potential return

Last price : RM0.29


Support : RM0.275

Stop-loss : RM0.27


RM0.395 and stop-loss at RM0.27. After

the earlier correction, share price has

rebounded and moved above the BBI line,

implying the correction is over. The steady

incline in the RSI points to a gradual rise in

momentum. This is supported by the

positive readings in the MACD and DMI. As

such, we expect the upward movement to

be sustainable, and thus peg our upside

targets at RM0.365 and RM0.395 in the

near term.

Expected time frame: 2 weeks to 2

months.



M A L A Y S I A

TRADERS’ CORNER

ML Global (MLG MK) Technical BUY with +19.9% potential return

Last price : RM0.83


Support : RM0.77

Stop-loss : RM0.765

BUY with a target price of RM0.995 and

stop-loss at RM0.765. Yesterday’s

movement had triggered a BUY on the

back of a positive closing above the BBI

line, a growing bullish divergence in DMI

and a golden crossover in the MACD. This,

along with a consistent climbing along the

trend line, is likely to increase MLG’s

probability of moving higher in the near

term. We peg our targets at RM0.92 and

RM0.995 in the near term.

Expected Timeframe: 2 weeks to 2

months



M A L A Y S I A

CORPORATE NEWS

Ajinomoto: Distribute bulk of compensation to

shareholders. Ajinomoto (Malaysia) Bhd will distribute bulk of the RM165.99m

compensation from the government for the compulsory acquisition of its plot of land in

Jalan Kuchai Lama to its shareholders. Ajinomoto MD and CEO Keiji Kaneko said on

Tuesday the remainder would be used for investments over the next five years. However,

no decision had been made as yet on whether to accept the compensation and it had until

end-December to decide. (Source: The Star)

Censof Holdings: Develop system for IRB to help the US

combat tax evasion. Censof Holdings Bhd, through unit Century Software (M)

Sdn Bhd, will develop and implement the Foreign Account Tax Compliance Act (Fatca)

Automatic Exchange of Information Solution for the Inland Revenue Board of Malaysia

(IRB). “We had implemented the Electronic Revenue Accounting System (eRAS) for IRB in

2008 and this contract is testament to our strong technical capabilities and track record,”

Censof group MD Ameer Shaik Mydin said in a statement. Censof did not disclose the

value and period of the contract in the statement. (Source: The Star)

Kimlun Corp: Bags RM52.8m deal to supply MRT tunnel

linings. Kimlun Corp Bhd has secured a RM52.8m contract for the supply and delivery

of precast concrete tunnel segment linings to the Mass Rapid Transit 2 (MRT2) project. In

a statement, the construction firm said it was awarded the contract by MMC Gamuda

KVMRT (UGW) joint venture for the Sungai Buloh-Serdang-Putrajaya (SSP) alignment.

The estimated date of completion was 30 Sep 19. “The company does not foresee any

exceptional risk other than operational risks associated with the supply contract,” Kimlun

said. “The supply contract is expected to contribute positively to the earnings and net

assets to Kimlun group for the financial years during the supply period,” it added. (Source:

The Star)

Kuala Lumpur Kepong: MP Evans uses valuation report to

justify rejecting KLK’s offer. London-listed oil palm and rubber plantation

firm MP Evans Group PLC, which is the takeover target of Kuala Lumpur Kepong

Bhd (KLK), said independent valuer Khong & Jaafar has valued its assets at 46% higher

than the KLK offer. In an announcement to London’s Alternative Investment Market on

Monday, it said Khong & Jaafar, a Malaysian firm that specialises in the valuation of oil

palm estates and property, valued the group’s land assets at US$665m (RM2.97b), “which

implies an equity value of £10.82 (RM60.25) per share.” In its sweetened bid to take over

MP Evans, KLK had on 15 November offered £7.40 (RM41.20) per share. However, the

next day MP Evans said shareholders holding 40.85% of its share capital intended to reject

the offer. KLK nonetheless posted its offer document to MP Evans shareholders without

further revision to the offer price, noting that the letters of intent signed by shareholders

holding 40.85% of the share capital were not binding. MP Evans also pledged to pay an

annual dividend, excluding special dividends, of at least 15 pence (83.5 sen) per share in

respect of each 2016 and 2017, a jump of at least 71% compared with those paid in

respect of 2015. (Source: The Star)

MyEG Services: Aborts plans to invest in start-ups,

venture into Kazakhstan. My EG Services Bhd (MyEG) has aborted two

proposed joint-venture (JV) projects -- one to set up a fund to invest in technology start-ups

and the other to introduce e-Government services in Kazakhstan. In filings with Bursa

Malaysia, the e-Government services provider said it and Cradle Fund Sdn Bhd on

Tuesday mutually agreed to terminate the memorandum of understanding (MoU) signed in

October 2013 to establish a RM60m JV fund to invest in equity or equity-oriented early

stage technology start-up corporations. Under the aborted plan, Cradle Fund was to invest

RM40m while MyEG was to put in the remaining RM20m. (Source: The Star)



M A L A Y S I A

Sime Darby Plantation: Indonesian unit replants

aggressively. PT Minamas Gemilang, the Indonesian unit of Sime Darby Plantation,

is undertaking an aggressive replanting programme to improve production yield. Sime

Darby Plantation is the plantation and agri-business arm of the Sime Darby group, and one

of its five core divisions. Minamas president/director Haryanto Tedjawidjaja said the

company had been aggressively replanting unproductive trees with higher yielding

seedlings, taking advantage of the dismal levels of palm oil prices over the past couple of

years. “We have been aggressively replanting 14,000ha annually or 7% of our 203,000ha

of planted area. “As these young trees start to mature and bear fruit, Minamas estates’

yield should improve further,” he added. (Source: The Star)

Sime Darby Property: Inks deal with Turner International

as project consultant. Sime Darby Property has signed on international

construction services company Turner International as its project and construction

management consultant for potentially three high-rise developments collectively worth over

RM1.3b in gross development value (GDV). At a signing ceremony today, it was revealed

that Turner International's involvement with Sime Darby will encompass advisory and

consultancy roles for Cantara Residences at Ara Damansara, an integrated development

of 888 serviced apartments units with a GDV of RM676.05m. (Source: The Star)

YTL Land: Buy rest of Sentul Raya for RM252.42m. YTL Land

& Development Bhd has proposed to acquire the remaining 30% equity interest in Sentul

Raya Sdn Bhd from Keretapi Tanah Melayu Bhd (KTMB) and its wholly-owned subsidiary

KTMB (Sentul) Sdn Bhd for RM252.42m. It said the proposed acquisition enables it to gain

full control of the future business direction of Sentul Raya. In a filing with Bursa Malaysia,

YTL Land said it has entered into an agreement with KTMB and KTMB Sentul for the

proposed acquisition of 2.4m shares or a 30% stake in Sentul Raya. (Source: The Edge

Financial Daily)

SECTOR

Oil & Gas: Petronas among pre-qualified bidders for

Mexican oil field auctions. Petroliam Nasional Bhd (Petronas) is among the

individual bidders and among the members of the consortia pre-qualified to bid on Mexico’s

first-ever deep water oil auctions, said Reuters. A Reuters report said Mexico’s oil regulator

announced on Monday a final list of 17 oil companies representing a dozen countries that

had pre-qualified for the bidding next month. The pre-qualified individual bidders, according

to the article, are Australia’s BHP Billiton, Britain’s BP, China’s CNOOC, the United States’

ExxonMobil, Malaysia’s Petronas, Mexico’s Pemex, Norway’s Statoil and France’s Total.

The seven pre-qualified consortia are Atlantic Rim and Royal Dutch Shell; Eni and Lukoil;

Murphy, Ophir, Petronas unit PC Carigali and Sierra Offshore Exploration; PC Carigali and

Sierra; Statoil, BP and Total; Total and ExxonMobil; and Chevron along with Pemex and

Inpex Corp. Reuters said the auctions would mark the fourth phase of the so-called Round

One tender, a major part of an energy reform launched in 2013 that ended the decades-

long monopoly enjoyed by Pemex and aims to reverse a dozen years of falling crude

output. (Source: The Star)



M A L A Y S I A

FROM THE REGIONAL MORNING NOTES...

Alliance Financial Group: 2QFY17: Strong Operating Cost

Discipline Offset By Weak Revenue (AFG MK/HOLD/RM3.72/Target: RM3.80) AFG’s 2QFY17 net profit was in line with expectations, driven by strong cost discipline and

wealth management income but partially offset by weak trading income and NIM pressure.

Management alludes to a weaker 2H17 due to lower recoveries and a sluggish growth

environment. Maintain HOLD with a Gordon Growth derived-target price of RM3.80 (1.15x

FY17F P/B, 10.4% ROE). Entry price: RM3.50.

UMW Holdings: 3Q16: Sinks Deeper Into The Red (UMWH MK/SELL/RM4.87/Target: RM4.00) UMW’s 3Q16 core net loss of RM127.8m was below expectations. The underperformance

largely stemmed from: a) a higher-than-expected 3Q16 loss before tax of RM133m from its

55.7%-owned UMW O&G, and b) loss before tax of RM121.9m from the others segment.

Outlook for all of its core businesses, notably automobile and O&G, remains bleak and we

see no improvement in sight. Maintain SELL with a lower target price of RM4.00, implying

0.8x 2017F P/B.

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M A L A Y S I A

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r e t a i l m a r k e t m o n i t o r wednesday, 30 ... · 12/2/2016 · r e t a i l m a r k e t m...

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