Maybank IB Views

Wednesday, September 7, 2011

Alam Maritim Resources RM0.73: Hold
Stepping up contract wins Shariah-compliant

Bags RM220m of OSV contracts, a positive. OSV hiring is gaining momentum, reflecting the improving prospects for local-flagged vessels in tandem with the intensification of PETRONAS' capex programs. However, Alam’s fleet growth remains constrained by its stretched balance sheet, impeding its earnings potential. Maintain Hold with a RM0.85 target price, pegged to 9x 2012 EPS.

The FBM KLCI tumbled 8.75 points to close at 1,454.37 yesterday. Its resistance areas of 1,454 and 1,474 will cap market gains, whilst the weaker support areas are located at 1,423 and 1,450.Due to the US markets’ weaker tone last night; we will see a softer mode for the local bourse today.

Trading Idea is a Take Profit call on RHBCAP

Other Local News
RHBCap: Looks for new chief by year-end, Delays application to buy Bank Mestika. RHB Bank Bhd is on the lookout for a new MD now since Renzo Viegas, its principal officer that was supposed to be MD, intends to take time off. A potential candidate is likely to be finalised soon, possibly in the next two to three weeks, and will likely be appointed before the year-end if the central bank has no objections to the candidate. RHBCap has put on hold its application to acquire Indonesia's PT Bank Mestika Dharma pending a review by Indonesia’s central bank to impose a limit on single-party ownership in commercial banks there. (Source: Business Times)

MAS: US firm sues for USD80m. Malaysian Airline System Bhd has been sued by GIRO — Warranty House International Inc, which is seeking damages of up to USD80m (RM239m). MAS is reviewing the complaint with the assistance of external counsel. (Source; Bursa Malaysia)

Sime Darby: E&O deal under scrutiny. The securities commission (SC) is examining the circumstances of the transaction involving Sime Darby buying 30% stake in Eastern & Oriental Bhd. The premium paid by Sime Darby is one, among several factors which the SC will take into consideration in deciding whether an acquirer has obtained control of a company. (Source: The Star)

Mining: Perak passes EIA reports for Brazil's Vale to set up maritime terminal. The Perak state government has passed the Environmental Impact Assessment (EIA) reports for Brazilian mining giant Vale SA to set up a maritime terminal in Teluk Rubiah near Lumut. Vale is investing an initial USD1.4b, or RM4.1b, to develop the first phase of an iron ore complex with capacity to dock vessels and handle as much as 30m tonnes of iron ore a year, starting 1H14. (Source: Business Times)


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