RHBInvest Research

Top Story: Plantation – Production getting back on track
Neutral

Sector Update
Malaysia’s CPO production recovered in Mar, rising 29.4% mom, while exports rose by 10.8% mom, resulting in a 9.1% mom increase in closing stock levels to 1.61m tonnes (from 1.48m tonnes in Feb). While part of the mom increase could be attributed to the shorter month in Feb, we believe the bulk of the increase was due to recovering FFB yields in the country as the La Niña effect started wearing off and weather started normalising.

Macro View

IPI: Bounced back to 5.0% yoy in February

Economic Highlights (published 11 Apr 2011)
Industrial production bounced back to +5.0% yoy in Feb, after softening to +0.5% in Jan and compared with +4.5% in Dec, due to a rebound in manufacturing production and stronger electricity output as well as a smaller fall in mining output during the month.
The rebound in Feb’s industrial and manufacturing production will likely be temporary and it will likely weaken back in the months ahead. As a result, we expect real GDP growth to moderate to 4.6% yoy in the 1Q, from +4.8% in the 4Q of last year.

Sector Call


Semicon: More consolidation for the industry? Neutral

Sector Update

Unisem: Fair value at RM2.65 implies 32.5% upside Outperform

MPI: Fair value at RM5.96 Market Perform

Notion: Fair value maintained at RM2.25 Market Perform

JCY: Fair value unchanged at RM0.81 Market Perform