Maybank IB Views

ACQUISITIONS / DISPOSAL
Glomac RM1.72: Buy
Deep value, strong upside potential Shariah-compliant

Growth intact on strong sales. We expect 9MFY11 results, due on 31 Mar, to be in line (+70% YoY). Glomac will very likely beat its RM500m FY11 sales target thanks to strong take-up at Glomac Damansara (GD), lifting total unbilled sales above the RM1b mark this year. This excludes potential enbloc sales worth up to RM445m, some of which are at the advanced stage of negotiations. We raise earnings forecasts by 6-11% and RNAV by 11%. Our TP is upgraded to RM2.38 (20% discount to RM2.97 RNAV). Glomac is our top small-cap property pick.

ECONOMICS
Industrial Production Index (IPI), Jan '11
No surprise in the slow start to 2011...

Jan '11 industrial production growth decelerated further to +1.0% YoY (vs revised Dec '10: +4.5% YoY; Maybank IB: +1.7% YoY; Consensus: +1.2% YoY). Manufacturing and electricity output continued to post growth albeit at slower paces while mining output contracted for a fourth consecutive month. MoM, overall production grew by +0.4% from Dec '10.


Technicals
The FBM KLCI fell 6.78 points yesterday to close at 1,516.91. Its resistance areas of 1,516 and 1,530 will cap market gains, whilst the obvious support areas are located at 1,500 and 1,514.

Trading idea for today is a Buy call on SAPCRES.