R e t a i l M a r k e t M o n i t o r Wednesday, 2 Aug ust 2017

Transcription

1 MARKET NEWS FBMKLCI CHART The FBMKLCI rose 5.1pt to close at 1, yesterday. Meanwhile, global stocks advanced following the latest set of corporate results, with European shares grinding higher and Asian peers jumping on both earnings and promising economic data. The MSCI Asia-Pacific Index rose to the highest since 2007 as equity indexes from Tokyo to Sydney advanced. The FBMKLCI s top gainers were Genting Malaysia (+1.7%), Public Bank (+1.6%) and Malayan Banking (+1.2%), while the top losers were IJM Corporation (-1.2%), Kuala Lumpur Kepong (-0.81%) and Sime Darby (-0.74%). In the broader market, losers outpaced gainers 503 to 271 with 454 counters unchanged. Turnover was 1.82b shares valued at RM2.23b. The FBMKLCI has recovered from the earlier pullback and closed higher at 1, yesterday. From a technical perspective, the RSI line has risen above 50pt, which signals weaker selling pressure and thus may push the index higher in the near term. The benchmark index has closed above the BBI line, signalling upward continuation from here onwards. Overall, we expect the index will move in a sideways mode ranging from 1,760-1,770. Support and resistance levels are still maintained as follows: Support: 1,752,1,742 Resistance: 1,787, 1,800 The DJIA racked up a fifth straight record high on Tuesday and neared the 22,000 mark, powered by Goldman Sachs, JPMorgan Chase and other banks. Apple rose 0.89% as Wall Street awaited the largest publicly listed company's quarterly report after the bell, with the iphone maker expected by analysts to post a 6% rise in revenue. The S&P 500 information technology index (SPLRCT) is up 22% ytd, leading other sectors. The DJIA closed higher at 21,963. The S&P 500 closed 0.24% higher while the Nasdaq Composite closed at , up 0.23%. Economic data showed US consumer spending barely rose in June as income failed to increase for the first time in seven months. WHAT S IN THE PACK My E.G. Service (MYEG MK/HOLD/RM2.15/Target: RM2.29) GST monitoring system provides clearer earnings visibility; maintain HOLD although the stock should firm up ahead of 2Q17 results. M-Mode (MMB MK) Technical BUY on breakout with 301% potential return BUY on breakout with a target price of RM0.475 and stop-loss at RM Currently, share price is consolidating within the immediate support of RM0.31 and yesterday s positive closing above the BBI sets a new tone for the short-term outlook. Sinotop Holdings (SNHB MK) Technical BUY on breakout with +29.5% potential return BUY on breakout with a target price of RM0.945 and stop-loss at RM Based on the chart, SNHB has seen its share price recover gradually and move above the 7- and 21-day EMAs following the movement in the last few days, effectively reversing its sideways trend. Wah Seong Corporation (WSC MK) Technical BUY with 27.5% potential return BUY with a target price of RM1.23 and stop-loss at RM A buying signal is seen as the stock had just penetrated above the Ichimoku cloud yesterday. Source: Bursa Station KEY INDICES Prev Close Chg (%) YTD (%) DJIA 21, S&P 500 2, FTSE 100 7, CSI 300 3, FSSTI 3, HSCEI 11, HSI 27, JCI 5, (0.61) 9.60 KLCI 1, KOSPI 2, Nikkei , SET 1, TWSE 10, BDI (1.56) CPO (RM/mt) 2, (0.79) (14.63) Nymex Crude (US$/bbl) (0.77) (14.41) TOP VOLUME Stock Price (RM) Chg (%) Vol ( 000) Frontken Corp Bhd ,175 Systech Bhd ,333 Lotte Chemical Titan 4.28 (8.94) 55,170 Kronologi Asia Bhd ,208 Managepay Systems ,110 TOP GAINERS Stock Price (RM) Chg (%) Vol ( 000) Smtrack Bhd ,085 Systech Bhd ,333 Diversified Gateway China Ouhua Winery Key Alliance Group ,102 TOP LOSERS Stock Price (RM) Chg (%) Vol ( 000) Perusahaan Sadur 6.75 (16.67) 562 Maxwell International 0.03 (16.67) 1,059 Eka Noodles Bhd 0.07 (12.50) 1,993 Key Asic Bhd 0.15 (11.76) 12,937 G Neptune Bhd 0.08 (11.76) 1,088 Source: Bloomberg w w w. u t r a d e. c o m. m y 1

2 TRADERS CORNER M-Mode (MMB MK) Technical BUY on breakout with +30.1% potential return Last price: RM0.365 Target price: RM0.44, RM0.475 Support: RM0.31 Stop-loss: RM0.305 BUY on breakout with a target price of RM0.475 and stop-loss at RM Currently, share price is consolidating within the immediate support of RM0.31 and yesterday s positive closing above the BBI sets a new tone for the short-term outlook. We expect MMB to continue the upwards movement once it manages to penetrate the breakout level of RM0.365 This bullish movement is supported by an uptick in the RSI and bullish crossover in MACD and DMI. Expected Timeframe: 2 weeks to 2 months Sinotop Holdings (SNHB MK) Technical BUY on breakout with +29.5% potential return Last price: RM0.70 Target price: RM0.91, RM0.945 Support: RM0.65 Stop-loss: RM0.645 BUY on breakout with a target price of RM0.945 and stop-loss at RM Based on the chart, SNHB has seen its share price recover gradually and move above the 7- and 21-day EMAs following the movement in the last few days, effectively reversing its sideways trend. This is supported by the rising RSI and DMI indicators, which indicate that positive momentum, would strengthen in the near term. We expect SHNB to continue its upward movement once it manages to penetrate the breakout level of RM0.73. Expected Timeframe: 2 weeks to 2 months. w w w. u t r a d e. c o m. m y 2

3 TRADERS CORNER Wah Seong Corporation (WSC MK) Technical BUY with +27.5% potential return Last price: RM0.965 Target price: RM1.14, RM1.23 Support: RM0.91 Stop-loss: RM0.905 BUY with a target price of RM1.23 and stop-loss at RM A buying signal is seen as the stock had just penetrated above the Ichimoku cloud yesterday. This is supported by the Heat Wave indicators as the Tenkan-sen line, Kinjun-sen line and Chikao span line, which suggest a bullish signal. An uptick in the RSI suggests buying momentum is set to continue in the near term. Currently, the DMI is showing a bullish crossover to support the upward momentum. We peg our targets at RM1.14 and RM1.23 in near to medium term. Expected Timeframe: 2 weeks to 2 months ANALYST Mohd Fakhrul Asyraq, MSTA, CFTe mohdfakhrulasyraq@uobkayhian.com w w w. u t r a d e. c o m. m y 3

4 CORPORATE NEWS 1MDB: Says payment to IPIC will be made in August. 1 Malaysia Development Bhd (1MDB) said on Tuesday it had written to International Petroleum Investment Co. (IPIC) to inform them that the obligations, due on 31 July, would be made in August. In a three paragraph statement, 1MDB said all payments due from 1MDB to IPIC will be made from the proceeds of the 1MDB rationalisation plan. 1MDB itself is awaiting funds that were due to be received in July Due to the need for additional regulatory approvals, the receipt of those funds has been delayed to August As these are the funds which will be used to pay IPIC, 1MDB has written to IPIC to inform them of our commitment to meet the obligations, originally due on 31 Jul 17, in August 2017, it said. (Source: The Star) 1MDB: Paid RM671m in company tax since 2013, says Najib. 1Malaysia Development Berhad (1MDB) has paid RM m in company tax since 2013, said Datuk Seri Najib Tun Razak. The Finance Minister told the Dewan Rakyat on Tuesday that the company and its fully-owned subsidiaries received income tax exemption including dividends for a 10-year period from 2010 in line with Section 127 (3A) of the Income Tax Act Najib said the tax exemption given to the company does not cover its other subsidiary or those acquired by 1MDB after 2010 such as Edra Global Energy Bhd (Edra). He also said the tax exemption does not include Real Property Gains Tax. "In 2013, the company paid a total of RM199,058,000. It paid RM212,911,000 in 2014, and RM259,168,000 in The company did not pay any tax in 2016 and 2017 as it sold Edra Global Energy Bhd last year," he said in a written reply to Er Teck Hwa (DAP- Bakri). (Source: The Star) Iris Corp: Rozabil becomes executive deputy chairman. Iris Corp Bhd has appointed Destini Bhd group managing director Datuk Rozamujib Abdul Rahman as its executive deputy chairman effective 1 Aug. The trusted identity solutions company recently undertook a private placement exercise which led to Rozabil, along with Datuk Paul Poh, emerging as its substantial shareholders via their investment vehicle Caprice Development Sdn Bhd. In a filing with Bursa Malaysia on Tuesday, Iris also said its chairman Tan Sri Razali Ismail had resigned to focus on his personal undertakings. He had been the company s chairman since Non-executive director Datuk Nik Azman Mohd Zain has been redesignated as the company s new chairman. He is currently also a director in Felda Investment Corp Sdn Bhd (FIC) and FIC Kuching Property Sdn Bhd. (Source: The Star) Kerjaya Prospek: Unit bags RM45m contract. A subsidiary of Kerjaya Prospek Group Bhd has been appointed subcontractor for reclamation works on the Seri Tanjung Pinang 2 (STP2) project. Its 70%-owned subsidiary company, Future Rock Sdn Bhd (FRSB) accepted a letter of award from China Communications Construction Company (M) Sdn Bhd (CCC) on Tuesday. The RM45.95m contract will see FRSB act as subcontractor for the project known as Perimeter Bund (CH100 to CH1150) for Phase 2B of the STP2 project. The construction works to be undertaken by FRSB is expected to commence on 27 Jul 17 and due to be completed on 26 May 18. (Source: The Star) w w w. u t r a d e. c o m. m y 4

5 Sime Darby: Sells stake in property company to PNB for RM625m. Sime Darby Bhd, via its unit Sime Darby Property Bhd, is disposing its entire interest in a property company to a unit of Permodalan Nasional Bhd for RM625m. The group told the stock exchange on Tuesday that Sime Darby Property had entered into a Share Sale Agreement for the disposal of its entire 40% equity interest in Seriemas Development Sdn Bhd (SDSB) comprising one million ordinary shares to PNB Development Sdn Bhd. The consideration was arrived at on a willing-buyer basis between the two parties after taking into consideration the market value of the land and investment properties held by SDSB of RM2.79b. It is also based on the valuation of Sime Darby Property s 40% equity interest in SDSB as at 31 Mar 17 of RM1.23b based on the valuation report dated 31 Jul 17 by KPMG, and the cash dividend of RM120m received by Sime Darby Property from SDSB on 30 Jun 17. It represents a discount of 39.4% to the RNAV of SDSB. Sime Darby s original cost of investment in SDSB was RM449m. (Source: The Star) Sunway Bhd: To redevelop land into RM1.4b mixed development. Sunway Bhd is buying four parcels of freehold industrial land in Subang Jaya totalling 5.99ha which it plans to redevelop into a mixed use development with an estimated gross development value of at least RM1.4b. In a filing with Bursa Malaysia, it said its indirect wholly-owned subsidiary, Sunway Supply Chain Enterprise Sdn Bhd, had on Monday inked a memorandum of agreement (with the intention of signing a definitive agreement later) to buy the land from Jaks Resources Bhd s unit Premier Place Property Sdn Bhd for RM167.6m. The sale and purchase agreement will be conditional on the approval of the shareholders of Jaks Resources. Sunway said in the immediate term, the land would be used for warehouses and storage facilities. Surplus areas may be leased to external parties. In the medium term, the company plans to redevelop the strategicallylocated parcels of land for mixed use development. (Source: The Star) Sunway Bhd: Plans RM460m transit-oriented development in Kajang. Sunway Bhd is taking over a discontinued commercial development project in Kajang and aims to replace it with a mixed development having an estimated gross development value of RM460m. In a filing with Bursa Malaysia, the propertyconstruction group said its subsidiary Daksina Harta Sdn Bhd had signed an agreement to buy the land - with the partially completed development on it - for RM63m. The land spans 24,281.1 sq metres before deducting the portion that was compulsorily acquired by the relevant authority measuring 2,928 sq metres. The 5.28-acre land, acquired from Concept Housing Development (M) Sdn Bhd, contains a partially completed commercial complex comprising a three-storey podium (three units of office space), two office blocks of 20 and 12 storeys with a total of 26 office space units, and a 10-storey car park. The purchase was a related-party transaction, as Concept Housing Development s directors and major shareholders are Cheah He Mooi (Sunway executive chairman Tan Sri Jeffrey Cheah s sister) and her husband Yap Chin Gum. (Source: The Star) Wah Seong Corp: Subsidiary bags US$24.2m contract. Wah Seong Corp Bhd s Indonesian subsidiary has been awarded a USD24.22m contract by Siemens SAS for the design and build up of three substations including heating, ventilation and air conditioning for a project in Kazakhstan. In an announcement to the stock exchange on Tuesday, the group said its indirect subsidiary; PT Wasco Engineering Indonesia had been awarded the contract. The scope of work of the contract involves 3D modelling, structural analysis and design, blast wall design and design of all ancillary system such as lighting, safety, fire and gas detection. It also includes the provision of all necessary manufacturing drawings and full procurement of all items within its design scope and subsequently the responsibility for all aspects of the construction phase including installation and integration of all of the free issue equipment. The group said activity is expected to commence in 3Q17 and be completed by 30 Oct 18. (Source: The Star) w w w. u t r a d e. c o m. m y 5

6 SECTOR F&B: QSR Brands names Azahari as its new MD. QSR Brands (M) Holdings Bhd, the operator of the Kentucky Fried Chicken and Pizza Hut restaurant chains, has appointed Datuk Mohamed Azahari Kamil as managing director effective 1 Aug. The region s largest quick service restaurant operator said in a statement that Azahari had had a distinguished career in the financial services and educational sectors. He held senior management posts in organisations such as Malaysian Industrial Development Finance Bhd, Permodalan Nasional Bhd, Amanah Raya-JMF Asset Management, and Asian Finance Bank Bhd. Most recently, he was group president of SEGi University & Colleges. (Source: The Star) Media: Malaysia s pioneer newsprint producer to be wound up. Malaysian Newsprint Industries Sdn Bhd (MNI), a regional paper manufacturer and supplier owned partly by The New Straits Times Press (M) Bhd (NSTP) and Hong Leong Industries Bhd (HLI), has begun creditors voluntary winding-up proceedings. In filings with Bursa Malaysia, Media Prima Bhd and HLI said the board of their associated company MNI had on Tuesday appointed Lim San Peen of PricewaterhouseCoopers Advisory Services Sdn Bhd as the interim liquidator. MNI, incorporated on 4 Aug, 1976, is an indirect associate of Media Prima by virtue of NSTP s 21.36% direct equity interest. HLI, meanwhile, has a 33.65% interest. The board of MNI was of the opinion that MNI could not continue its business. MNI had been operating under very difficult market conditions, especially declining newsprint demand, and has incurred losses for the past three years, Media Prima and HLI said in separate announcements. Arising from the creditors voluntary winding-up, Media Prima will make a full impairment of RM142.4mil which is the group s carrying amount of investment in MNI as at 30 June. The HLI group will make a full impairment provision of RM171.5m, representing its carried amount of investment as at the same date. (Source: The Star) w w w. u t r a d e. c o m. m y 6

7 FROM THE REGIONAL MORNING NOTES... My E.G. Service: The Stars Align (MYEG MK/HOLD/RM2.15/Target: RM2.29) A range of new government legislations have significantly lowered the execution risks of MYEG s various new ventures and further underpin our 31.5% earnings CAGR in FY These legislations include: a) retailers to install the GST EMS devices, b) employers to provide basic minimum standard housing for foreign workers by 2018, and c) illegal foreign workers to take up insurance services upon their legalisation. Maintain HOLD. Target price: RM2.29. Entry price: RM2.06. For more reports, please log in to or open an account now to gain access. Explore our trading tools designed to assist you in your trading ShareXplorer, ChartGenie, TechAnalyzer, Stock Alerts! Broaden your knowledge through our educational events. Contact us now at to find out more about our ongoing promotions (get FREE* live feed on foreign markets). *T&C apply. w w w. u t r a d e. c o m. m y 7

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