R e t a i l M a r k e t M o n i t o r Wednesday, 10 June 2015

Transcription

1 MARKET NEWS FBMKLCI CHART The FBMKLCI continued to decline 10.40pt (-0.60%) and closed at 1, on yesterday s movement. Meanwhile, Asian stocks fell, with the regional benchmark heading for its longest losing streak since September as investors weighed the outlook for US interest rates and Chinese shares retreated from a seven-year high. The MSCI Asia Pacific Index declined 1% to The FBMKLCI s top losers were Maxis (-2.78%), SapuraKencana Petroleum (-2.64%) and Astro Malaysia Holdings (-1.94%) while the top gainers were Genting Malaysia (+0.48%), Public Bank (+0.32%) and AMMB Holdings (+0.16%). In the broader market, losers outpaced gainers 605 to 221 with 278 counters unchanged. Turnover was 1.33b shares valued at RM1.47b. Based on daily chart, the FBMKLCI continued its pullback as the index slid lower and penetrated the immediate support of 1,732 yesterday. The correction looked set to continue as selling pressure grew as reflected by the negative reading in the RSI. Weaker regional sentiments as well as an absence of domestic catalysts may drag the index lower in the near-term. If the current sentiments persist, the FBMKLCI may potentially test the next support at 1,718 shortly. The support and resistance levels are as follows: Support: 1,718, 1,706 Resistance: 1,760, 1,776 US markets ended Tuesday s trading session virtually unchanged, despite the positive economic data. The S&P 500 closed up less than a point at 2, while the DJIA finished the day flat at 17, NFIB small-business index, which measures optimism among smaller companies, rose to 98.3 in May, the highest level since December, as six of 10 components improved. Burlington Stores Inc. slumped 8.4% after reporting weaker-than-expected first quarter revenue. Shares of Quiksilver Inc. plunged 32% after the outdoor-apparel company reported second-quarter results that came in worse than expected. WHAT S IN THE PACK Consumer Consumer sector s 1Q15 earnings were generally in line. F&B players recorded resilient 1Q15 earnings growth of 2-21% yoy. Although the retailers had a boost from the pre-gst shopping spree in 1Q15, we believe business will be challenging again post-gst. Inch Kenneth Kajang Rubber Plc (IKEN MK) Technical BUY on breakout with 17.2% potential return BUY on breakout with a target price of RM0.885 and stop-loss below RM Based on the daily chart, the share price consolidated within the immediate support of RM0.70 before yesterday s positive closing above the BBI which sets a new tone for the shortterm outlook. Sunsuria (SSR MK) Technical BUY on breakout with 16.4% potential return BUY on breakout with a target price of RM2.34 and stop-loss below RM1.87. Based on our earlier BUY call on 5 Feb 15, SSR initially hit our targets at RM1.54 and RM1.67. NCB Holdings (NCB MK) Technical BUY with 18.0% potential return BUY with a target price of RM3.54 and stop-loss below RM2.81. A buying signal has been given as the stock has been trading above the cloud. Source: BursaStation KEY INDICES Prev Close Chg (%) YTD (%) DJIA 17, (0.01) (0.33) S&P 500 2, FTSE 100 6, (0.53) 2.86 CSI 300 5, (0.68) FSSTI 3, (0.76) (2.08) HSCEI 13, (1.79) HSI 26, (1.20) JCI 4, (2.30) (6.26) KLCI 1, (0.60) (1.83) KOSPI 2, (0.06) 7.75 Nikkei , (1.76) SET 1, (1.06) (0.36) TWSE 9, (1.88) (1.24) BDI (21.74) CPO (RM/mt) 2, (0.69) 2.25 Nymex Crude (US$/bbl) TOP VOLUME Stock Price (RM) Chg (%) Vol ( 000) Dolphin International ,537 Kanger International ,806 Vsolar Group Bhd ,196 Frontken Corp Bhd 0.26 (3.77) 32,257 Ifca Msc Bhd 1.33 (3.62) 26,535 TOP GAINERS Stock Price (RM) Chg (%) Vol ( 000) Yong Tai Bhd ,824 Btm Resources Bhd ,979 Quality Concrete Scan Associates Bhd ,289 G Neptune Bhd ,061 TOP LOSERS Stock Price (RM) Chg (%) Vol ( 000) Biosis Group Bhd 0.02 (33.33) 1,465.8 Cybertowers Bhd 0.05 (18.18) Golden Land Bhd 1.60 (16.23) 5,604.6 Mycron Steel Bhd 0.29 (13.64) Pa Resources Bhd 0.07 (13.33) Source: Bloomberg w w w. u t r a d e. c o m. m y 1

2 TRADERS CORNER Inch Kenneth Kajang Rubber Plc (IKEN MK) Technical BUY on breakout with +17.2% potential return Last price : RM0.74 Target price : RM0.84, RM0.885 Support : RM0.70 Stop-loss : RM0.695 BUY on breakout with a target price of RM0.885 and stop-loss below RM Based on the daily chart, the share price consolidated within the immediate support of RM0.70 before yesterday s positive closing above the BBI which sets a new tone for the short-term outlook. We expect IKEN to continue making higher highs and higher lows if it penetrates the breakout level at RM The bullish bias has been established following an uptick in the RSI and a bullish crossover in the DMI. Expected Timeframe: 2 weeks to 2 months Sunsuria (SSR MK) Technical BUY on breakout with +16.4% potential return Last price : RM1.96 Target price : RM2.24, RM2.34 Support : RM1.88 Stop-loss : RM1.87 BUY on breakout with a target price of RM2.34 and stop-loss below RM1.87. Based on our earlier BUY call on 5 Feb 15, SSR initially hit our targets at RM1.54 and RM1.67. We expect a positive followthrough to validate a new up-leg if SSR manages to penetrate above the breakout level of RM2.01. The rising momentum as shown by a bullish crossover in the EMA7 and 21 along with an uptick in both the +DI and ADX lines suggest an upward continuation. We peg our new targets based on 1.38x and 1.61x Fibonacci extension level at RM2.24 and RM2.34. 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 NCB Holdings (NCB MK) Technical BUY with +18.0% potential return Last price : RM3.00 Target price : RM3.19, RM3.54 Support : RM2.82 Stop-loss : RM2.81 BUY with a target price of RM3.54 and stop-loss below RM2.81. A buying signal has been given as the stock has been trading above the cloud. The Heat Wave indicators - Tenkan-sen line, Kinjun-sen line and the Chikao span line are showing bullish signals. Based on the daily chart, NCB managed to penetrate the breakout level of RM2.96 yesterday, suggesting the stock will continue to move towards our targets. The uptick in the DMI shows buying momentum is outpacing selling momentum. Currently, MACD is on the verge to make a golden cross to positive signal. Expected Timeframe: 2 weeks to 3 months w w w. u t r a d e. c o m. m y 3

4 CORPORATE NEWS Bina Darulaman: Bags RM209.9m Kedah road maintenance job. Bina Darulaman Bhd announced its wholly-owned unit, BDB Infra Sdn Bhd, has accepted a RM209.9m contract from the Public Works Department of Kedah, to maintain state roads in 10 districts in Kedah for three years, starting from June 10 (tomorrow). In a filing with Bursa, Bina Darulaman said the letter of award was accepted on June 3 and the contract will require the company to maintain the roads in the districts of Kota Setar, Padang Terap, Kuala Muda, Sik, Kubang Pasu, Kulim, Bandar Baharu, Pendang, Yan and Baling. The project is expected to contribute positively to the group s earnings for the financial years ending Dec 31, 2015 (FY15) until FY18, the group said in a filing. (Source: The Edge Financial Daily) Cahaya mata Sarawak, Naim: Vie for power plant. Cahaya Mata Sarawak (CMS) and Naim Holdings are among four consortiums competing to build a 350MW to 4mmMW combined cycle gas turbine (CCGT) project in Bintulu, Sarawak, valued at RM400m, according to industry sources. The project is only for the engineering procurement and construction of the plant, and not a concession. Sarawak Energy, which is awarding the Kidurong project, will take ownership of the plant and operate it once it is completed. The purpose of the project is to support the ongoing development of the Sarawak Corridor of Renewable Energy (Score). The consortium with CMS is seen as a front runner in the tender of the power plant, which is called Kidurong project. It is expected to be awarded soon, the sources said. Meanwhile, Naim has partnered with Siemens Malaysia Sdn Bhd. Japan s Mitsubishi Heavy Industries has partnered with China Machinery Engineering Corp while China s Sinohydro Corp has [paired up with Alstom SA. (Source: The Edge Financial Daily) Magna Prima: Faces suit over its luxury condo in KL. Magna Prima, which markets The Avare at the Kuala Lumpur City Centre, is facing a RM25mil suit citing defects and poor workmanship at the super luxury condominium. The company said that Dr Adam Victor and 23 others filed a suit in the High Court against it and subsidiary Embassy Court Sdn Bhd (ECSB) for poor and defective façade design, low quality material, poor workmanship, failure to fully rectify the defect in the parcel and common property, structurally unsound construction and breach of the implied term to build and deliver a six-star luxurious condominium. They also alleged misrepresentation by Magna Prima and ECSB. Magna Prima is the proprietor of the The KLCC site, while ECSB was the developer. Its 78 units cost 3,800 sq ft to 7,696 sq ft, according to Magna Prima s website. (Source: The Star) Malaysia Airport: Foresees 15% passenger growth at Sabiha Gokcen. Malaysia Airports Holdings Bhd (MAHB) is projecting a 15% passenger growth at its recently acquired Istanbul Sabiha Gokcen International Airport, in Turkey. MD Datuk Badlisham Ghazali said the projection is a conservative figure based on existing passenger movement of close to 24 million annually. The airport operator, which bought the operating rights to Sabiha Gokcen in 2008, has invested more than 520 million euros so far in the airport. (Source: The Star) Malton: to launch Bukit Jalil City serviced apartments. Malton Bhd will launch 500 units of serviced apartments within its RM3.5b Bukit Jalil City project here in the next two weeks, with prices starting from RM775 per sq ft. "The Park Sky Residence" serviced apartments are part of Phase 2 of the Bukit Jalil City project, a joint venture development with Ho Hup Construction Co Bhd on a 50-acre (20.2ha) tract of land. The Park Sky Residence comprises four blocks of service apartments. Malton's ED Hong Lay Chuan said the serviced apartments will feature two-bedroom, threebedroom and dual-key units, with build-up ranging from 868 sq ft to 1,565 sq ft. Bukit Jalil City is divided into four major components. Construction of the shop offices are underway and will be completed in two years. Malton's order book stood at RM1.3b, which would keep the company busy for the next three years. (Source: The Edge Financial Daily) w w w. u t r a d e. c o m. m y 4

5 Naim Indah: Gets Sabah consultant deal. Naim Indah Corp has won a project management consulting deal, valued at about RM24mil, from GE Properties Sdn Bhd. The value for the award is 5% of the gross development cost of RM480mil of the Boulevard Likas project at Teluk Likas, Sabah. Boulevard Likas is a 30- storey mixed commercial development which is expected to take five years to complete, with piling works to start in June (Source: The Star) PUC Founder: eyes RM1m revenue a year from solar plant. PUC Founder (MSC) Bhd, which is making its maiden venture into solar power production with its 1mw solar power farm project in Sg Petani, Kedah, is expecting a 21- year recurring income of RM1m per annum from the first quarter of its financial year ending December 2016 (1QFY16). The power generated from the farm will be sold to Tenaga Nasional Bhd at a tariff of Rm1.035 per kwh. (Source: The Edge Financial Daily) Tanjung Offshore: Secures RM250m contract from Petronas Carigali. Tanjung Offshore secured a RM250m contract to provide topside maintenance to Petronas Carigali Sdn Bhd s platforms in Sarawak. The contract is for two years with an option to extend for another year. Tanjung Offshore CEO Rahman Shamsudin said the contract would benefit the company in the near term as the cost for such maintenance had little bearing to global oil prices. (Source: The Star) SECTOR Energy: Industries to pay more for their gas supply. The Government has revised the natural gas tariff for Peninsular Malaysia s commercial and industrial sectors, except for the power sector, effective July 1. The residential customers are not affected. Gas Malaysia said that the average gas tariff would be revised to RM21.80 per million British thermal units (MMBtu) from RM19.77/MMBtu previously. This is to take into account the increase in the purchase price of gas that Gas Malaysia procures from Petronas, it said. The selling prices for residential customers (Category A) remain at RM19.52 per MMBtu. For companies with average annual gas consumption of up to 600 MMBtu (Category B), their rate will fall from RM21 per MMBtu to RM20.30 per MMBtu. The other categories see an upward revision in tariff, with those consuming above 750,000 per MMBtu annually to pay RM22.22 per MMBtu from RM20.11 currently. (Source: The Star) O&G: EPIC to spend RM2bil to expand Kemaman Supply Base. The Terengganu government, through its unit Eastern Pacific Industrial Corp Bhd (EPIC), plans to spend RM2bil for the expansion of the Kemaman petroleum supply base. Construction work on the project is expected to begin in 2016 and be completed in We have been planning for an expansion for a long time as we need to prepare for growth. We want to make sure that Terengganu is serious and be exposed to as many opportunities as possible in the oil and gas sector, Terengganu Mentri Besar Datuk Seri Ahmad Razif Abdul Rahman said. Pengkalan Bekalan Kemaman Sdn Bhd, the operator of the Kemaman Supply Base, on Tuesday entered into a lease service agreement with five petroleum production companies in a RM500mil deal. The five companies are Carigali Hess Operating Company Sdn Bhd, Vestigo Petroleum Sdn Bhd, Coastal Energy KBM Sdn Bhd, EQ Petroleum Production Malaysia Ltd and Sapura Kencana Energy Peninsula Malaysia. (Source: The Star) Technology: Data centre players now facing price wars. Malaysia is now facing oversupply of data centre space, forcing intense price wars and shrinking profits for industry players with some non-generating data centres unable to secure tenants, said AIMS Group CEO Chiew Kok Hin. The issue of oversupply is getting worse every year. The business has potential to grow but right now, the industry is going through a glut. There will be not much growth, or at least meeting the Entry Point Project (EPP) target, until the demand and supply is balanced, he said. (Source: Malaysian Reserve ) w w w. u t r a d e. c o m. m y 5

6 Property: New Iskandar Malaysia launch. The second Iskandar Malaysia Comprehensive Development Plan (CDP) is expected to be launched at the end of the second quarter or early third quarter of this year. Iskandar Regional Development Authority CEO, Datuk Ismail Ibrahim, said the second CDP was a review of the first which was launched in On a separate note, Ismail said that in the first quarter of this year, Iskandar Malaysia secured RM7.8bil in new investments, of which 64% were domestic and the rest foreign. (Source: The Star) ECONOMICS Others: Malaysia incurs up to RM11.62b a year in offbalance sheet expenses. Prime Minister Datuk Seri Najib Razak told Parliament that the government has to assume off-balance sheet obligation of between RM4.76b and RM11.62b a year for nine government-owned companies starting this year to However, Najib did not reveal details of the usage of the money, which could cost the government over RM50b, by the nine government-owned companies. (Source: The Star) w w w. u t r a d e. c o m. m y 6

7 FROM THE REGIONAL MORNING NOTES... Consumer: 1Q15 Report Card: Retailers Lifted By Pre- GST Shopping Spree The consumer sector s 1Q15 earnings were generally in line. F&B players recorded resilient 1Q15 earnings growth of 2-21% yoy. Although the retailers had a boost from the pre-gst shopping spree in 1Q15, we believe business will be challenging again post- GST. Maintain MARKET WEIGHT, due to: a) lofty valuations with limited earnings growth, and b) unexciting dividend yields. We like F&B players like QL Resources for its defensive attributes along with organic growth and recommend investors to buy on weakness. 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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