MONEY MASTER

  Foreign investors ended their six-week net buying streak with a net outflow of RM527 million last week, according to a report by MIDF Research on Monday. The largest daily outflow was recorded on Wednesday at RM165.5 million . Despite the overall outflow, sectors such as Utilities (RM40.9 million), Industrial Products & Services (RM24.8 million), and Healthcare (RM8.2 million) saw net foreign inflows . On the other hand, Financial Services (-RM193.7 million), Technology (-RM137.3 million), and Consumer Products & Services (-RM50.7 million) experienced the highest net foreign outflows . Local institutions remained supportive, net buying RM240.3 million for the third consecutive week, while local retailers reversed their two-week selling trend with net purchases of RM286.7 million . However, the average daily trading volume (ADTV) saw declines across all investor groups. Foreign investors' ADTV dropped by 34.0% , local institutional investors by 21.2% , and local ...

Retain BUY with target price (TP) of RM2.19 INVESTMENT HIGHLIGHTS Strong reassurance from visit to HSL in Sarawak Affordable housing and wastewater works will support earnings growth Reaffirm earnings estimates Maintain  BUY  with an adjusted  TP  of  RM2.19 Strong reassurance from visit to HSL in Sarawak . We emerged from HSL’s Kuching Wastewater Treatment and La Promenade visit in Sarawak with reassurance on our revenue, target orderbook and earnings forecasts for FYE17/FYE18/FYE19 Key takeaways from visit: Compelling underlying sewerage needs.  HSL’s key competency in sewerage and wastewater engineering i.e. micro tunnelling and piping will anchor its future earnings prospect due to the strong need of efficient wastewater and sewerage connection in Kuching, Miri and Sibu from growing population. In a revised master plan in 2007, Sarawak Sewerage Department (SSD) has estimated that 3 Wastewater plants are needed to support ...

Reaffirm BUY with an unchanged target price (TP) of RM4.84 INVESTMENT HIGHLIGHTS Syarikat Takaful Malaysia Bhd (STMB)’s 1QFY17 PAZTAMI of RM56.8m (+23%yoy) was within ours and consensus expectations Family Takaful continued to support the growth in 1QFY17 earnings As the result is within our estimates, we make no changes to our existing forecast numbers Hence we reiterate our  BUY  recommendation with an unchanged  TP  of  RM4.84  per share 1QFY17 PAZTAMI met expectations.  Despite challenging macroeconomic condition, STMB has continued to deliver solid PAZTAMI performance in 1QFY17, where it grew +23.0%yoy to RM56.8m. The increase was as a result of higher Wakalah fee income of RM186.3m (+13.0%yoy) to the Group and its portfolio rebalancing strategy to reduce exposure in risky assets. Overall, the reported earnings came in line with ours (at 29.1%) and consensus’ (at 29.5%) expectations. Strong 1QFY17 earnings growth in t...

Retain NEUTRAL with an unchanged target price (TP) of RM1.69 INVESTMENT HIGHLIGHTS 1QFY17 earnings within expectations Unexciting earnings on sequential basis Marginally weaker earnings on yearly basis Maintain NEUTRAL with an unchanged TP of RM1.69 1QFY17 earnings within expectations. CapitaLand Malaysia Mall Trust (CMMT) 1QFY17 core net income of RM40.24m was in line with our and consensus expectations, at 24% and 23% of our and consensus full year estimates respectively. Distribution per unit for the quarter is 2.08sen. Unexciting earnings on sequential basis.  On a sequential basis, 1QFY17 core net income of RM40.24m eased by a marginal 2% qoq, mainly due to lower contribution from Sungei Wang Plaza (SWP) and The Mines which offset the growing contribution from Gurney Plaza, East Coast Mall, and Tropicana City property. The weaker contribution from SWP was owing to the negative rental reversion consequent to the ongoing MRT construction works and c...

Retain NEUTRAL with an unchanged target price (TP) of RM7.18 INVESTMENT HIGHLIGHTS Petronas Chemicals Group Bhd (PChem) approves FID for Isononanol plant Total investment cost of project is USD442m (approximately RM1.9b) Plant expected to be operational by 2HFY19 PChem’s balance sheet can comfortably fund project as cash hoard is at RM7.4b with negligible borrowings Maintain NEUTRAL with unchanged TP of RM7.18 FID approved.  PChem announced that it has approved the final investment decision (FID) for an Isononanol plant within the Pengerang Integrated Complex in Pengerang Johor. The total investment cost is USD442m or approximately RM1.9b. The project is slated to be on-stream by 2HFY19. Details of plant.  The company guided that isononanol is an oxoalcohol which is mainly used for the production of Diisononyl phthalate, a high molecular weight phthalate plasticizer which is widely used in industrial applications such as automotive, wires and c...

Retain BUY call with a target price (TP) of RM4.03 INVESTMENT HIGHLIGHTS Acquiring land in Singapore for SGD265m Positive on both of the news Earnings estimate unchanged Maintain BUY with higher TP of RM4.03 Acquiring land in Singapore for SGD265m . SP Setia Berhad (SPSETIA) had won a tender for a 4.6 acres land along Toh Tuck Road, Singapore for SGD265.0m (or RM847.6m). We gather that SPSETIA plans to develop a 5-storey condominium with 327 units on the 99-year leasehold land with GDV of SGD457.0m (or RM1.46b). Fundings can be from combination of internally generated funds and borrowings. Target property launch is in 2018 with expected completion period of 5 years. Details of the land.  The Land is located near the vicinity of Bukit Timah region and it is accessible to Pan Island Expressway (PIE), the Bukit Timah Expressway (BKE) and Ayer Rajah Expressway (AYE). It is also close to the Beauty World MRT station (~650m away). Nearby amenities include...

Maintain BUY with unchanged target price (TP) of RM1.08 MBSB has received approval from Bank Negara Malaysia (BNM) to commence negotiations on a proposed merger We are positive on the ongoing development towards becoming a full-fledged Islamic bank We maintain our earnings forecast at this juncture Hence we reaffirm our BUY recommendation with an unchanged TP of RM1.08 NEWS MBSB gets nod for negotiations on a proposed merger.  MBSB yesterday has received a letter from BNM dated 21 December 2016 which states that BNM has no objection in principle for MBSB to commence negotiations with the existing shareholders of Asian Finance Bank Berhad (AFB) namely Qatar Islamic Bank, RUSB Investment Bank Inc, Tadhamon International Islamic Bank and Financial Assets Bahrain WLL for a proposed merger of MBSB and AFB. BNM requires that the negotiations be completed within six months from the date of BNM’s letter. OUR VIEW Positive on the proposed merger. ...