Maybank IB Views

MARKET COMMENTS
INVEST MALAYSIA 2011
From message to passage of transformation

Giant leap towards Malaysia's 2020 high-income economy aspiration. The New Economic Model (NEM) unveiled by Prime Minister Dato' Sri Mohd Najib bin Tun Abdul Razak in Invest Malaysia 2010 (31 March 2010) has swung into full action with the Government Transformation Programme (GTP) entering its second year and the rollout of the Economic Transformation Programme (ETP) barely 6 months after its launch.

ECONOMICS
Industrial Production Index (IPI), Feb '11
YoY growth stays volatile

Industrial production growth picked up in Feb '11 to +5.0% YoY (revised Jan '11: +0.5% YoY; Maybank IB: +4.9% YoY; Consensus: +5.4% YoY). MoM, output shrank 7.2% as Chinese New Year holidays compounded a short working month. For Jan-Feb 2011, production rose +2.6% YoY (4Q10: +4.1% YoY; Jan-Feb 2010: +9.4% YoY), suggesting quarterly real GDP growth likely to have remained moderate in 1Q 2011 after the slowdowns during 2H 2010.

Technicals
The FBM KLCI closed lower by 13.49 points at 1,544.00 yesterday. Its resistance areas of 1,544 and 1,565 will cap market gains, whilst the obvious support areas are located at 1,529 and 1,540. Due to the DJIA’s marginally weaker tone last night, we will see the FBM KLCI in a further profit-taking mode today.

Trading Idea for today is a Take Profit call for TENAGA.

Other Local News
UMW: Expects oil & gas unit to be back in the black. UMW Holdings Bhd is confident that its oil and gas division will be back in the black this year, helped by several jobs it has secured. The company is banking on the performance of associate company WSP Holdings Ltd in China, its success in securing a drilling job from Petronas Carigali and expectations of a bigger revenue contribution from its foreign joint ventures, especially those in India and China. (Source: Business Times)

Westports: Container handling Up 20% In 1Q. Westports Malaysia Sdn Bhd posted a 20% growth in container handling for the first quarter this year compared with the same period last year. Westports container throughput was 1.5m twenty-foot equivalent unit (TEU), the highest ever quarterly achievement compared with 1.2m TEUs in the same period last year. (Source: Bernama)

Sagajuta: To unveil RM2b projects. Sagajuta (Sabah) Sdn Bhd, a pioneer developer in Sabah is launching four commercial projects worth almost RM2b this year, as demand for the properties increases, its chief said. They include the abandoned commercial project in Selangor, called 1Gateway Klang, which its unit, Lagenda Erajuta Sdn Bhd, has taken over and is reviving this month. The three new projects are located in Kota Kinabalu, Bukit Mertajam in Penang and Johor Baru, launching in phases from the end of this year. The projects will comprise modern shoplots, office towers, street mall and leisure facilities. (Source: Business Times)

Coastal: Secures deal to sell 11 tugboats. Coastal Contracts Bhd won contracts for the sale of 11 tugboats to a company based in Central America for about RM61m. Including the new contracts, the group to date has about RM665m worth of vessel sales orders awaiting delivery to customers up to 2012. (Source: Business Times)