Maybank IB Views

Monday, July 11, 2011

Construction & Property: Overweight
First MY Rapid Line (MRT) launched

Overweight Construction. Prime Minister Najib's launch of the Sg Buloh-Kajang (SBK) mass rapid transit (MRT) line last Friday cement scepticisms on the execution of the country's largest infrastructure project, which forms a critical component of the Greater KL/KV National Key Economic Area (NKEA) under the Economic Transformation Programme (ETP). We expect full construction works to start next year. We remain Overweight on the sector with Gamuda as our top pick.


Malaysia Airports Holdings RM6.50: Buy
Airports still flying high

Thriving under adversity. MAHB's May 2011 traffic statistics reveal a strong 14.6% YoY passenger growth (5M 2011: +13.3% YoY). This is way ahead than regional and global growth rates which underpins our positive stance for MAHB. Cargo volumes shrunk by 7.1% YoY (5M 2011: -2.6% YoY) due to the severe downturn of the electrical & electronics industry in Malaysia. Maintain Buy; no change to our earnings forecasts and RM7.12/share DCF-based target price.

The FBM KLCI gained 11.80-points and closed at 1,594.74 last Friday. The local market remained quite firm on a firm global market tone. Despite BNM’s MPC meeting SRR interest rate rise from 3% to 4% last Thursday, the market rose further. The firm support areas for the FBM KLCI are located in the 1,576 to 1,594-zone. The next resistance level of 1,595 may see token selling activities.

Trading Idea is a Short-Term Buy on AFG

Other Local News
Latexx: Due diligence on YTY almost over. Latexx Partners Bhd is poised to complete a due diligence on YTY Industry Holdings Sdn Bhd by as early as next month. Latexx is proposing to take over YTY for RM1.25b by paying 30% in cash, with the balance of the assets being swapped for Latexx shares. (Source: Business Times)

Ivory: Surges on hope of land award. Ivory Properties Group Bhd's share price has surged on anticipation that the Penang state government will decide this week if it is to award the company the rights to help develop 40ha of land in Bayan Mutiara. (Source: Business Times)

Dijaya: TAEL One buys more shares. TAEL One Partners Lts, a Cayman Islands-incorporated private equity firm, has raised its stake in Dijaya Corp Bhd to 7.25% after acquiring another 10.3m shares last Friday. (Source: The Sun)

Media: Catcha Media sees a big catch in online advertising. Catcha Media Bhd, one of the country's largest new media companies, is planning to launch websites for all its magazines as part of its plan to grow online advertising business. The company operates all of Microsoft's online properties in Malaysia, including the MSN portal, and has exclusive sales rights for leading Malaysian website It also publishes 14 magazines such as Clive, HomePride, Juice, Mint, Stuff and Prestige, among others. (Source: Business Times)

O&G: OM to build RM210m plant in Q4. OM Holdings Ltd (OMH) expects to start construction of its proposed USD70m (RM210m) manganese smelting and sintering plant in Tanjung Langsat Industrial Complex, Johor Baru in the fourth quarter this year. The Australian public-listed company said land clearing works for the project site is now carried out by Johor Corp. (Source: The Star)


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