PP16795/03/2013(031743)

Transcription

1 Thursday, 30 November, 2017 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Research Team PP16795/03/2013(031743) Reports Published Results Review: Padini 1Q18 ((In-line) ; Cost pressures setting in; TP: RM 5.30 (Hold) Results Review: Sarawak Oil Palms 3Q17 (Above) ; Earnings above expectations; TP: RM 6.00 (Buy) Results Review: Yee Lee Corporation 3Q17 (Below) ; Outlook remains positive; TP: RM 2.39 (Hold) Results Review: MyEG 1Q18 (Below) ; Robust growth continues; TP: RM 2.65 (Buy) Results Review: Ikhmas Jaya 3Q17 (Below) ; Rebound punctuated; TP: RM 0.65 (Hold) Corporate News Barakah reports 3rd consecutive net loss in 3Q on lower revenue Titijaya's unit to receive foreign investment worth RM47m Yinson to take over Layang FPSO project from THHE Lower tax expense boost Ahmad Zaki s 3Q profits Perisai losses narrow on absence of impairment Destini 3Q net profit surges 79% as revenue nearly triples Bursa Malaysia Close Chg +/- Chg % YTD Chg (%) FBMKLCI 1, FBMEMAS 12, FBM100 12, FBMEMAS Shariah 12, FBM Hijrah Shariah 14, Volume (m) 1, Value (MYR m) 2, Economic News US third-quarter economic growth fastest in three years Europe's central banks warn about bubbles critics say they helped create Euro zone sentiment booms, inflation expectations grow Japan govt expects shorter work hours to cut workers' pay by 5 trillion yen Indonesia's headline inflation rate seen easing again in November OPEC, Russia set for oil cut extension but wary of overheating market KLCI Performance KLCI Year-End Target: 1,790 points Regional Indices Commodities (Last Close) Close Chg +/- Chg % YTD Chg (%) Close Chg +/- Chg % DJIA 23, Brent Crude (USD/bbl) NASDAQ 6, WTI Crude (USD/bbl) S&P 500 2, CPO (RM/MT) 2, FTSE 100 7, Gold (USD/ounce) 1, Nikkei , Latex (sen/kg) HSI 29, Soybean Oil SHCOMP 3, KOSPI 2, Forex TWSE 10, (per USD) BIMB (YE Forecast) Close Chg +/- Chg % STI 3, MYR JCI 6, JPY SET 1, EUR PSEi 8, SGD

2 Major Rates Daily Participation % Participation Bought Sold Net KLIBOR 3-mth 3.43 (%) (MYR m) (MYR m) (MYR m) KLIBOR 6-mth 3.56 Local Insti , , KLIBOR 12-mth 3.63 Local Retail yr MGS 3.63 Foreign yr MGS 3.95 Total , , Performance of BIMB Stock Coverage Top Gainers Source: Bank Negara Malaysia Top Losers Source: The Sun, BIMB Securities Research Close Chg +/- Chg % Close Chg +/- Chg % Tenaga Nasional % Prestariang % Hibiscus % IOI Properties % UEM Sunrise % Datasonic % Nestle % Westports % MCT % Malakoff % 2

3 CORPORATE NEWS Barakah reports 3 rd consecutive net loss in 3Q on lower revenue Barakah Offshore Petroleum has posted a 3 rd consecutive net loss of RM56.16m or 6.8sen per share for the 3QFY17, from a net profit of RM1.97m or sen per share last year on lower revenue generated by the installation and construction services. Its quarterly revenue fell 38.52% to RM102.79m compared with RM167.19m in the previous year. Its installation and construction services saw a decrease of 49% in revenue generated of RM75.57m compared with RM148.33m last year due to the lower contract value of the ongoing transportation and installation projects executed during the current quarter. For the cumulative 9 months of FY17, Barakah reported a net loss of RM142.87m or 17.31sen per share, compared with a net profit of RM10.45m or 1.27sen per share last year. Its revenue slipped by 43% to RM232.26m against RM407.46m. (Source: The Edge) Titijaya's unit to receive foreign investment worth RM47m Titijaya Land wholly-owned Epoch Property has today entered into a conditional share subscription agreement with Japan-based Tokyu Land Corp (TLC) for a subscription consideration of RM47m. The agreement entails the subscription by TLC of 47m units (representing 100%) of Class A shares in Epoch Property. The proposed subscription is to enhance the development of an ongoing project known as Mizu Residence with joint effort and cooperation between Titijaya and TLC, vis-à-vis the designing, planning, construction, and promotional events of the development. Incorporated in 1953, TLC a real-estate company is a core subsidiary of Tokyo Stock Exchangelisted Tokyu Fudosan Holdings Group. (Source: The Edge) Yinson to take over Layang FPSO project from THHE Yinson Holdings associate company Yinson Energy intends to take over the Layang floating production storage and offloading (FPSO) project, after TH Heavy Engineering (THHE) applied to the Kuala Lumpur High Court for leave to novate the project. Yinson Energy has affirmed affidavits and extended copies to the High Court with regard to the application made by THHE for leave to enter into and complete a proposed novation of the contract for provision of engineering, procurement, construction, installation and commissioning (EPCIC) and leasing for Layang FPSO facilities on Nov 27, 2014, to Yinson Energy. The charter contract which is for EPCIC and leasing of a floating production storage and offloading facility to be deployed at the Layang field in Block SK10, offshore Miri, Sarawak was initially made between JX Nippon Oil & Gas Exploration (Malaysia) Ltd and THHE. (Source: The Edge) Lower tax expense boost Ahmad Zaki s 3Q profits Ahmad Zaki Resources net profit 3QFY17 grew 17.7% yoy to RM10.03m from RM8.52m, as the group was subjected to lower tax expense during the financial quarter under review. Ahmad Zaki said its tax expense in 3QFY17 amounted to RM9.73m, compared with RM24.29m incurred a year earlier. Quarterly revenue grew 8.8% yoy to RM294.75m from RM270.85m, largely attributed to improved operations of the Plantation and O&G divisions. The plantation division s revenue increased significantly to RM36.1m from RM4.1m in the previous year, mainly due to the sales of CPO from the newly commissioned mill in February this year. (Source: The Edge) Perisai losses narrow on absence of impairment Perisai Petroleum Teknologi has narrowed its net losses to RM42.17m for 1QFY18 from RM293.3 m in the corresponding quarter last year. The Practice Note 17 (PN17) company turned in revenue of RM39.89m in 1QFY18, consistent with its top line of RM38.91m a year ago. Losses per share improved from 0.24sen previously, to 0.03sen during the quarter under review. Perisai explained that the improvement in its losses incurred was mainly due to the higher provision for impairment loss in the corresponding quarter ended Sept 30, (Source: The Edge) Destini 3Q net profit surges 79% as revenue nearly triples Destini Bhd's net profit for 3QFY17 surged 79% to RM8.85m from RM4.95m a year ago, on the back of higher contribution from its marine and aviation manufacturing services. Quarterly revenue nearly tripled yoy to RM190.9m from RM48.62m, mainly due to higher orders for the group s maintenance, repair and overhaul (MRO) services, marine, and aviation manufacturing services. For its 9MFY17, Destini posted a 19% increase in net profit to RM25.02m, while revenue more than doubled to RM577.59m from RM m the year before. The stronger earnings was due to improved contribution from MRO services in its aviation business, and the marine manufacturing division. (Source: The Edge) 3

4 ECONOMIC NEWS US 3Q economic growth fastest in three years The US economy grew faster than initially thought in the third quarter, notching its quickest pace in three years, as increases in business investment in inventories and equipment offset a moderation in consumer spending. Gross domestic product expanded at a 3.3% annual rate in the third quarter also boosted by a rebound in government spending, the Commerce Department said in its second GDP estimate on Wednesday. That was the fastest pace since the third quarter of 2014 and a pickup from the second quarter's 3.1% rate. The economy was previously reported to have grown at a 3.0% pace in the July-September period. It was the first time since 2014 that the economy experienced growth of 3% or more for two straight quarters. (Source: Reuters) Europe's central banks warn about bubbles critics say they helped create Three of Europe's top central banks raised warning signals on Wednesday about the risk of financial bubbles that their ultra-easy monetary policies are blamed for creating. The European Central Bank, Germany's Bundesbank and Denmark's Nationalbank highlighted pockets of vulnerability ranging from excessive property prices in some countries to complacent investors and easy lending by some banks. Critics have long blamed these phenomena on the central banks' own ultra-low interest rates, aimed at spurring lending and risktaking, and massive cash injections, such as the ECB's 2.55 trillion euro (US$3 trillion) bond-buying programme. Germans in particular have been protesting that too much stimulus risks doing more damage than good a view that was reiterated by the country's central bank on Wednesday. (Source: Reuters) Euro zone sentiment booms, inflation expectations grow Euro zone economic sentiment rose in November for the sixth consecutive month to its highest level in more than 17 years, data from the European Commission showed on Wednesday, while inflation expectations grew. The new rise confirmed the solid economic recovery of the 19-country currency bloc despite the strong euro and political crisis in two of its largest members, Germany and Spain. The buoyant sentiment was also compounded by expectations of higher prices among manufacturers and consumers, a positive signal for the European Central Bank's efforts to raise inflation closer to target. The European Commission's monthly survey showed that sentiment in the euro zone rose to in November from in October, in line with the average forecast of economists polled by Reuters. (Source: Reuters) Japan govt expects shorter work hours to cut workers' pay by 5trn Japanese workers' pay will fall by as much as 5trn yen (USD44.86bn) as the government moves to reduce the country's notoriously long working hours. The government's plan to lower the number of overtime hours worked is part of a programme to increase productivity and draw more women into the workforce to keep the economy growing. Prime Minister Shinzo Abe's government is also asking companies to raise wages by 3% next year at annual negotiations with labour unions. The government hopes that increase will offset any decline in pay as a result of working less overtime. However, there is no guarantee that all companies will raise wages as requested and there is a risk that a net decline in wages for some employees who work less overtime will harm consumption. (Source: Reuters) Indonesia's headline inflation rate seen easing again in November Indonesia's annual inflation rate likely eased for a fifth consecutive month in November, a Reuters poll showed, as food prices remained weak. The consumer price index (CPI) rose 3.40% in November from a year earlier, compared with 3.58% in October. The annual core inflation rate, which excludes government-controlled and volatile food prices, was seen increasing slightly at 3.10% in November, compared with 3.07% in October. It would be a 3 rd month of increase in the annual core inflation. Relatively cooler inflation has afforded Bank Indonesia windows to cut key interest rates twice in recent months, in a bid to boost consumption. It had eased the main policy rate by 2% points since the beginning of 2016 to help lift growth. (Source: Reuters) OPEC, Russia set for oil cut extension but wary of overheating market OPEC and Russia look set to prolong oil supply cuts until the end of 2018 this week while signalling that they may review the deal when they meet again in June if the market overheats. With oil prices rallying above USD60 per barrel, Russia has questioned the wisdom of extending existing cuts of 1.8m bpd until the end of next year as such a move could prompt a spike in US production. Russia needs much lower oil prices to balance its budget than OPEC's leader Saudi Arabia, which is preparing a stock market listing for national energy champion Aramco next year and would hence benefit from pricier crude. (Source: Reuters) 4

5 ECONOMIC CALENDAR Date Time Country Event Period Survey Actual Prior Revised 11/30/ :00 UR PPI YoY Nov % 7.28% -- 11/30/ :00 UR PPI MoM Nov % 2.19% -- 11/30/ :40 CR Consumer Confidence Index Nov /30/ :16 NC Remittances Total Oct /30/ :13 BI CPI YoY Oct % 0.70% -- 11/30/ :26 BI GDP YoY 3Q % 1.10% -- 11/30/ :45 NZ Building Permits MoM Oct % -2.30% -2.50% 11/30/ :51 GU Leading Interest Rate Nov % 3.00% -- 11/30/ :00 SK Industrial Production SA MoM Oct 0.20% -1.10% 0.10% 0.20% 11/30/ :00 SK Industrial Production YoY Oct 3.00% -5.90% 8.40% 8.50% 11/30/ :00 SK Cyclical Leading Index Change Oct /30/ :50 JN Industrial Production MoM Oct P 1.80% % -- 11/30/ :50 JN Industrial Production YoY Oct P 7.10% % -- 11/30/ :50 JN Japan Buying Foreign Bonds Nov b -- 11/30/ :50 JN Japan Buying Foreign Stocks Nov b -- 11/30/ :50 JN Foreign Buying Japan Bonds Nov b -- 11/30/ :50 JN Foreign Buying Japan Stocks Nov b -- 11/30/ :00 NZ ANZ Activity Outlook Nov /30/ :00 NZ ANZ Business Confidence Nov /30/ :01 UK GfK Consumer Confidence Nov /30/ :01 UK Lloyds Business Barometer Nov /30/ :30 AU Private Sector Credit MoM Oct 0.40% % -- 11/30/ :30 AU Private Sector Credit YoY Oct 5.30% % -- 11/30/ :30 AU Private Capital Expenditure 3Q 1.00% % -- 11/30/ :30 AU Building Approvals MoM Oct -1.00% % -- 11/30/ :30 AU Building Approvals YoY Oct 14.10% % -- 11/30/ :00 CH Manufacturing PMI Nov /30/ :00 CH Non-manufacturing PMI Nov /30/ :00 CH Swift Global Payments CNY Oct % -- 11/30/ :00 SI Credit Card Billings SGD Oct m -- 11/30/ :00 SI Credit Card Bad Debts SGD Oct m -- 11/30/ :00 SI Money Supply M2 YoY Oct % -- 11/30/ :00 SI Money Supply M1 YoY Oct % -- 11/30/ :00 SI Bank Loans and Advances YoY Oct % -- 11/30/ :00 TH Mfg Production Index ISIC NSA YoY Oct 3.20% % -- 11/30/ :00 TH Capacity Utilization ISIC Oct /30/ :00 JN Vehicle Production YoY Oct % -- 11/30/ :00 JN Housing Starts YoY Oct -2.80% % -- 11/30/ :00 JN Annualized Housing Starts Oct 0.952m m -- 11/30/ :00 JN Construction Orders YoY Oct % -- 11/30/ :00 ES Industrial Production YoY Oct % -- 11/30/ :00 ES GDP QoQ 3Q % -- 11/30/ :00 ES GDP YoY 3Q % -- 11/30/ :45 SZ GDP QoQ 3Q 0.60% % -- 11/30/ :45 SZ GDP YoY 3Q 0.80% % -- 11/30/ :00 GE Retail Sales MoM Oct 0.30% % -- 11/30/ :00 GE Retail Sales YoY Oct 2.80% % -- 11/30/ :00 DE Unemployment Rate Gross Rate Oct % -- 11/30/ :00 DE Unemployment Rate SA Oct % -- 11/30/ :00 DE GDP SA YoY 3Q P 1.70% % -- 11/30/ :00 DE GDP SA QoQ 3Q P -0.20% %

6 DEFINITION OF RATINGS BIMB Securities uses the following rating system: STOCK RECOMMENDATION BUY Total return (price appreciation plus dividend yield) is expected to exceed 10 in the next 12 months. TRADING BUY Share price may exceed 15 over the next 3 months, however longer-term outlook remains uncertain. HOLD Share price may fall within the range of +/- 10 over the next 12 months TAKE PROFIT Target price has been attained. Fundamentals remain intact. Look to accumulate at lower levels. TRADING SELL Share price may fall by more than 15 in the next 3 months. SELL Share price may fall by more than 10 over the next 12 months. NOT RATED Stock is not within regular research coverage. SECTOR RECOMMENDATION OVERWEIGHT The Industry as defined by the analyst s coverage universe, is expected to outperform the relevant primary market index over the next 12 months NEUTRAL The Industry as defined by the analyst s coverage universe, is expected to perform in line with the relevant primary market index over the next 12 months UNDERWEIGHT The Industry as defined by the analyst s coverage universe, is expected to underperform the relevant primary market index over the next 12 months Applicability of ratings The respective analyst maintains a coverage universe of stocks, the list of which may be adjusted according to needs. Investment ratings are only applicable to the stocks which form part of the coverage universe. Reports on companies which are not part of the coverage do not carry investment ratings as we do not actively follow developments in these companies. Disclaimer The investments discussed or recommended in this report may not be suitable for all investors. This report has been prepared for information purposes only and is not an offer to sell or a solicitation to buy any securities. The directors and employees of BIMB Securities Sdn may from time to time have a position in or either the securities mentioned herein. Members of the BIMB and their affiliates may provide services to any company and affiliates of such companies whose securities are mentioned herein. The information herein was obtained or derived from sources that we believe are reliable, but while all reasonable care has been taken to ensure that stated facts are accurate and opinions fair and reasonable, we do not represent that it is accurate or complete and it should not be relied upon as such. No liability can be accepted for any loss that may arise from the use of this report. All opinions and estimates included in this report constitute our judgements as of this date and are subject to change without notice. BIMB Securities Sdn accepts no liability for any direct, indirect or consequential loss arising from use of this report. Printed and published by BIMB SECURITIES SB ( X) A Participating Organisation of Bursa Malaysia Securities Level 32, Menara Multi Purpose, Capital Square, No. 8 Jalan Munshi Abdullah, Kuala Lumpur Tel: Fax: Azharuddin Nordin Head of Research 6