Maybank IB Views

Thursday, June 9, 2011

Oil & Gas: Overweight
PETRONAS FY11 report card: Quest and request

Balancing aspiration and obligation. We laud PETRONAS' request for a fairer dividend distribution in its quest for growth while keeping its financial discipline. O&G is a capital intensive business and much of the retained earnings is to be essentially set out for new hydrocarbon resources. Higher capex simply translates into higher growth opportunities for the local O&G players. We continue to Overweight the sector. Dialog, Kencana, PGas and SapCrest are our choiced picks.

The FBM KLCI closed marginally lower by 0.10 points and ended at 1,551.79 yesterday. Its resistance areas of 1,554 and 1,568 will cap market gains, whilst the obvious support areas are located at 1,537 and 1,551. We expect the FBM KLCI to remain quiet today, as it there may be a spill over of the boring US and regional markets.

Daily trading idea is a Short-Term BUY call on YINSON

Other Local News
TNB: Buys power from Singapore to ensure supply security. Tenaga Nasional Bhd (TNB) is buying power from Singapore-based PowerSeraya Ltd, a unit of YTL Power International Bhd, due to a shutdown of Petroliam Nasional Bhd-owned gas production platforms for maintenance and dwindling gas supply. (Source: The Star)

BJTOTO: May roll out new game on this weekend. Berjaya Sports Toto Berhad is expected to introduce a new game which is believed to be something similar to the 4D Jackpot introduced by Magnum 4D in September 2009. It is likely to help the company to grow its sales and expand its market share. (Source: Business Times)

Latexx: Accepts revised offer from YTY. Rubber gloves maker Latexx Partners Bhd's board has accepted a revised offer of RM1.25b (initially RM1.35b) on its proposed merger with YTY Industry Sdn Bhd. (Source: Bursa Malaysia)

Dijaya: Buys land for RM385m. Dijaya Corp Bhd has acquired 88.5 acres of freehold land in Pekan Country Heights, Selangor, from Chunghwa Picture Tubes (Malaysia) Sdn Bhd for RM385.5m. The land would be transformed into a mixed development comprising residential and commercial elements with an expected gross development value (GDV) of RM2.5b. (Source: The Edge Financial Daily)

MYEG: Set for Kazakh e-services venture. MY E.G. Services Bhd (MYEG) is set to collaborate with Kazakhstan company National Information Technologies JSC (NIT) to introduce e-government services to the republic this year in its first overseas venture. (Source: The Star)

AmFirst: To buy 2 Cyberjaya buildings. AmFirst Real Estate Investment Trust is expected to sign a deal to buy two commercial buildings in Cyberjaya with a combined estimated value of over RM130m. It currently has 6 assets worth RM1.02b. The properties, which are a couple of years old, were identified as Prima 9 and Prima 10. They are both located within the Prima Avenue II development in Cyberjaya. (Source: Business Times)


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