Maybank IB Views

ECONOMICS
Economic Transformation Programme (ETP)
Keeping the momentum going...

Round four of ETP update saw the announcement of 23 investments totaling RM14.75b involving 9 new Entry Point Projects (EPPs) and 14 other projects/initiatives in 8 National Key Economic Areas (NKEAs), giving to-date totals of 60 projects/initiatives in 46 EPPs under 11 NKEAs with RM95.4b investment producing RM137.2b in GNI and creating 224,358 jobs. Therefore, 35% of the 131 EPPs, 12% of the targeted RM794.5b EPP investment, 12.8% of the targeted RM1.1tr incremental GNI and 6.8% of new jobs creations have been announced.


SECTOR UPDATE
Media: Overweight
A strong finish, an encouraging start

Maintain Overweight. Media earnings surprised on the upside during the 4Q10 results season on strong adex growth. Jan 2011 industry gross adex growth remained encouraging at +14% YoY led by TV as consumer sentiment remained robust at a 3 ¼ year high. We expect seasonal weakness in Feb 2011 but still a likely high single to low double digits growth in percentage terms YoY. Media Prima's recent share price weakness is an opportunity to accumulate and MCIL is a value proposition at single digit valuations.
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Technicals
The FBM KLCI rose marginally by 1.92 points yesterday to close at 1,517.66. Its resistance areas of 1,517 and 1,537 will cap market gains, whilst the obvious support areas are located at 1,498 and 1,516. We expect the index to remain in a minor rebound mode in the short term and very bearish in the medium term.

Trading idea for today is a Short-Term Buy call on PCHEM.
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Other Local News
Sime Darby: Emery Oleochemicals to invest RM416m. Prime Minister Datuk Seri Najib Razak announced a RM416.2m investment led by the Emery Oleochemicals Group in three sub-projects to produce bio-lubricants and green polymer additive as well as surfactants for home and personal wellness products. Emery Oleochemicals Group is a 50:50 JV between Sime Darby Plantation and PTT Chemicals of Thailand. (Source: The Edge Financial Daily)

Bursa: Aims to double derivatives trade volume. Bursa Malaysia Derivatives Bhd aims to double its daily trading average to 50,000 contracts over the next three years in line with growing investor interest. The collaboration with US-based CME Group to expand trading of commodity futures, increase the volume of existing products and introduce new products, would drive the market's growth. (Source: Business Times)

Cypark: To build renewable energy park for RM94m. Cypark will spearhead an initiative to build a 10MW Renewable Energy Park on 26 hectares of remediated landfill in Pajam, Nilai, Negeri Sembilan with an investment of RM94.3m. (Source: Bursa Malaysia)

REDtone: Upbeat about venture into health care. General Electric Malaysia will collaborate with local partners that include REDtone International Bhd, to develop diagnostic services nexus (DSN), a teleradiology hub that involves RM30m of investment. (Source: The Star)

Infrastructure: McKinsey appointed consultant for MRT. McKinsey & Co has been hired as consultants to carry out the value management study (VMS) on the mass rapid transit (MRT) project. The VMS is an important element in SPAD's plan to ensure that the MRT is carried out in the most cost-efficient way. (Source: The Star)

Plantation: Call to speed up approval of foreign workers for harvest season. The Federal and Sabah state governments have been urged to quickly approve new applications of foreign workers to harvest fresh fruit bunches in the months ahead. This is to enable the industry to achieve the 17.6m tonnes crude palm oil output target this year. The industry will need to hire up to 50,000, or 20%, more foreign workers to harvest fresh fruit bunches from the trees as more oil palms reach their prime fruit-bearing age profile. (Source: Business Times)

Property: Easy first home. Young working adults earnings less than RM3,000 a month can now obtain up to 100% financing to buy their first home under the My First Home Scheme. The scheme will unable young adults to buy houses costing between RM100,000 and RM220,000 with a repayment period of up to 30 years. The scheme sees the participation of 25 conventional and Islamic financial institutions. (Source: The Star)