WTK

WTK already posted new 3rd quarter report 2012.

Current price: RM0.95

EPS 
1st Q  =  2.14 sen
2nd Q =  1.96 sen
3rd Q =  3.97 sen
4th Q =  ?? sen (Feb 2013)

~ Total  8 sen for 3Q. 

EPS 2011 = 15.57 sen

Year High = RM2.15
Year Low = RM0.905

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RHBInvest Research

Top Story: WTK – Lower plywood production to weigh on 1H11 results Outperform

¨ WTK’s log production volume in 2Q11 was higher by +33% qoq and +28% yoy respectively due to normalised weather conditions. WTK has guided that its current realised price is US$220/m3 for meranti SQ up, which is lower than our expectation of US$260/m3 for FY11.

¨ We revised our fair value to RM2.55 based on unchanged target PER of 12x revised FY12 EPS of 21.2 sen. Maintain Outperform.



Corporate Highlights



Sunway Bhd: A single stock that gives all real estate exposure Outperform (Initiating coverage)

¨ Upon listing, Sunway Bhd will potentially become the 3rd/4th largest property player in Malaysia . The company will offer investors full fledge offerings of the real estate sector, ranging from property development to various property assets as well as construction arm. The key strength of Sunway Bhd after merger will be the leaner organisation and operating structure that will ultimately yield cost savings.

¨ We estimate an FY12-13 earnings growth of 7% and 11%, underpinned by RM1.6bn worth of unbilled sales, RM2bn worth of construction orderbook, as well as RM75-80m recurring income from property assets and Sunway REIT.



CIMB: CIMB Niaga 2Q11 results – Coming along nicely Outperform

¨ CIMB Niaga reported 2Q11 net profit of IDR818.6bn (+35.4% yoy; +12.5% qoq), bringing 1H11 net profit to IDR1,546.1bn (+37% yoy).

¨ Management guided for NIM to average around 5.4-5.5% for this year, roughly around current levels. Meanwhile, management now expects CIMB Niaga to post loan growth in excess of 20%, as compared to around 20% previously (1H1: 22.5% annualised). However, CASA growth ahead would be more challenging given that depositors are now seeking higher yields.

¨ No change to forecasts. Fair value of RM9.80 (15x CY12 EPS) and Outperform call maintained.



SapuraCrest: Buying Clough’s marine construction division Outperform

News Update

¨ Sapuracrest announced a proposal to acquire Clough’s “Marine Construction” business for AUD127m (RM400.5m) cash. Completion is expected by 4QCY11.

¨ The acquisition will: 1) Strengthen Sapuracrest’s international foothold (especially Australia ); 2) Increase its asset base; and 3) Spearhead an entry to the subsea market.

¨ Maintain Outperform and fair value of RM5.04/share (based on 21x FY13 EPS).

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RHBInvest Research

Top Story: Utilities

• Sector Update
• TNB lacks catalysts going forward.
• YTL Power may lose a bit of shine since the key investment thesis for the stock has historically been high dividend yields.
• The restructuring of the water sector in Selangor is expected to remain in a deadlock situation.
• We maintain our Underweight stance on the sector due to lack of catalysts.

Sector Call

Oil & Gas:

• Sector Update
• Improvement seen for vessel market
• Petra Perdana (OP, FV = RM1.39) thus reflects the expected rise in valuation for the company’s vessel assets.
• We maintain our Overweight call on the sector in light of the positive bias on the sector’s outlook. Our top picks are Petronas Chemicals (OP, FV = RM9.02) and SapuraCrest (OP, FV = RM4.37).

Timber:

• Sector Update
• It’s a “sellers” market now for plywood given the anticipated increase in demand from Japan, low inventory level, limited increase in supply, and disruption in Japan domestic plywood production.
• We downgrade our call on WTKH to Market Perform (from outperform previously) due to the limited upside to our fair value. WTK share price has rallied by 65% since the Japan earthquake on 11 Mar.
• We reiterate our Overweight call on the sector. Top picks are Jaya Tiasa (OP, FV = RM7.84) and Ta Ann (OP, FV = RM7.99).

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RHBInvest Research

WTK:

• Off to a good start
• We revised our fair value to RM1.56 (from RM1.44 previously).
• Outperform call

Corporate Highlights


Quill Capita:

• Below expectations again
• We revise our indicative fair value to RM1.20 (from RM1.23).
• We downgrade QC to Market Perform.

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RHBInvest Research Highlights 09th November 2010

Top Story

Timber:

• Looking good.
• Overweight stance on the sector.

Ta Ann: Fair value revised to RM5.92, from RM5.12. Outperform (up from MP)
Jaya Tiasa: Fair value revised to RM5.31, from RM4.73. Outperform
WTK: Fair value revised to RM1.64, from RM1.60. Outperform

Corporate Highlights

Digi:

• Prepared to hold its ground.
• Maintain Outperform call on DiGi with fair value of RM26.35

AirAsia:

• Price war looming.
• Fair value is cut from RM3.01 to RM2.10. Downgrade to Underperform from outperform.

MAS:

• To expand Firefly into a full-fledged low-cost carrier.
• Maintain Underperform. Fair value is RM1.91

Dayang:

• Jumped significantly in 2QFY10.
• Fair value raised to RM3.86/share (from RM3.01 previously), Maintain Outperform.

Technical Highlights

Daily Trading Strategy:

• A potential removal of 1,524.69 today.
• A penetration to above 1,524.69 will induce another wave of fresh buying momentum, in our opinion.
• Potentially, the FBM KLCI could head higher towards our medium-term upside projection target at 1,668 over the longer tem.
• In fact, even if it fails to take out 1,524.69, the current robust sentiment is likely to persist amid strong rotational plays and robust trading volume of late.

Daily Technical Watch: DNP Holdings

• Likely to push for further gains toward RM2.12 and RM2.37
• Immediate Support at RM1.80
• Immediate Resistance at RM2.12

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