RHBInvest Research

Malaysia Equities

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Taking Stock – Fundamentals Playing Catch-Up

Market Update

- Our expectations for the Dec 2011 quarter results are fairly neutral as we believe any bad news would have already been factored into earnings forecasts. However, we believe there is a possibility that some companies may use the market’s low expectations to delay booking in revenue (or provide for higher costs) in the 4QCY11 to boost the current year’s earnings.




Corporate Highlights




Digi – Looking Forward To LTE Outperform

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- We remain positive on DiGi for potential to sustain future growth by monetising its 5.2m mobile Internet subscriber base through LTE.

- We understand that competition has been stable so far in 2012. While DiGi noted that U Mobile’s presence in the market has increased, since U Mobile is only a quasi-MVNO we do not expect competition to turn irrational anytime soon.

TH Plantation – Joining the ranks of the mid-cap plantation stocks Outperform

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- Four key points: 1) Strong FFB production growth for FY11 achieved; 2) Production costs to rise in FY12, on higher labour and fertiliser costs; and 3) Work has started on THP’s new land acquisitions already; and 4) More acquisitions in 2012?

TRC Synergy – Defect liabilities weigh down on 4QFY12/11 performance Outperform

Results Preview

- We expect TRC’s FY11 net profit to miss expectations by 12-18% largely due to the recognition of additional defect liabilities in 4Q from certain recently completed projects.

BAT – BAT’s Market Share Grew In FY11 Market Perform (Upgraded)

Results/Briefing Note

- FY11 net profit (-1.6% yoy) was within expectations. BAT declared a fourth interim dividend of 66 sen, which brought its YTD dividend payout to 276 sen (including 30 sen special dividend paid in the 2QFY11).




Malaysia Equities




Top Story




Taking Stock – Fundamentals Playing Catch-Up

Market Update

- Our expectations for the Dec 2011 quarter results are fairly neutral as we believe any bad news would have already been factored into earnings forecasts. However, we believe there is a possibility that some companies may use the market’s low expectations to delay booking in revenue (or provide for higher costs) in the 4QCY11 to boost the current year’s earnings.




Corporate Highlights




Digi – Looking Forward To LTE Outperform

Visit Note

- We remain positive on DiGi for potential to sustain future growth by monetising its 5.2m mobile Internet subscriber base through LTE.

- We understand that competition has been stable so far in 2012. While DiGi noted that U Mobile’s presence in the market has increased, since U Mobile is only a quasi-MVNO we do not expect competition to turn irrational anytime soon.

TH Plantation – Joining the ranks of the mid-cap plantation stocks Outperform

Visit Note

- Four key points: 1) Strong FFB production growth for FY11 achieved; 2) Production costs to rise in FY12, on higher labour and fertiliser costs; and 3) Work has started on THP’s new land acquisitions already; and 4) More acquisitions in 2012?

TRC Synergy – Defect liabilities weigh down on 4QFY12/11 performance Outperform

Results Preview

- We expect TRC’s FY11 net profit to miss expectations by 12-18% largely due to the recognition of additional defect liabilities in 4Q from certain recently completed projects.

BAT – BAT’s Market Share Grew In FY11 Market Perform (Upgraded)

Results/Briefing Note

- FY11 net profit (-1.6% yoy) was within expectations. BAT declared a fourth interim dividend of 66 sen, which brought its YTD dividend payout to 276 sen (including 30 sen special dividend paid in the 2QFY11).