RHBInvest Research Highlights 21st October 2010

Top Story

Media:

• 9M10 print and tv adex up by 18.2% yoy
• Our Top pick is Media Prima (FV=RM2.75)
• We maintain Outperform call on Media Chinese (FV=RM1.21)
• Trading Buy call on Star (FV=RM4.34).
• Maintain Overweight for the sector.

Macro View

Economy:

• Leading index bounced back in Aug
• Pointing to resilient economic activities ahead.

Sector Call

Rubber Gloves:

• Still cautious on near-term outlook.
• Maintain Underperform call on Top Glove (FV=RM5.40)
• Market Perform call on Adventa (FV=RM2.47).
• As for Hartalega (FV=RM5.64), we downgrade our call to Market Perform.
• No change to our Neutral call on the sector.

Corporate Highlights

Puncak Niaga:

• Eyeing Hogenakkal water project in India .
• Fair value is RM3.01. Maintain Market Perform.

WCT:

• Secures RM1.36bn building job in Qatar and RM128m hospital project in Sabah .Fair value is raised to RM2.56 from RM2.30. Maintain Underperform.

Axis REIT:

• Quattro West started to contribute.
• Maintain Outperform call on Axis REIT with fair value of RM2.67.

BAT:

• Impact of less than 20’s ban cushioned by relaunch of Peter Stuyvesant.
• Fair value is thus raised to RM42.92 (from RM42.90 previously). Underperform.

Technical Highlights

Daily Trading Strategy:

• Recapturing the 10-day sma will renew upbeat sentiment.
• Further recovery to above the 10-day SMA today will attract further follow-through buying support in the near term.
• And once the recent high of 1,503.82 can be cleared, the short-term technical scenario will return to positive.
• On the downside, the solid medium-term support at 1,450 level and the 40-day SMA of 1,458 are expected to keep sellers at bay.

Daily Technical Watch: Alliance Financial Group

• Medium- to long-term uptrend remains largely intact.
• Immediate Support at RM3.10
• Immediate Resistance at RM3.30