Bursa Malaysia Daily Market Report - 21 July

Transcription

1. Friday , 21 July, 2017 For Internal Circulation Only TA RESEARCH’S ‘DAILY COMPILED REPORTS’ News 1. Daily Market Commentary 2. Daily Brief Fundamental Reports 1. British American Tobacco (Malaysia) Berhad: Illicit Cigs Market Share Reduced After 10 Months 2. Maxis Berhad: Better Valuations Amid Reduced Risk of Dividend Cuts 3. Westports Holdings Berhad: Poor Results Within Expectation Technical Reports 1. Daily Technical Stock Picks 2. Daily Stock Screen 3. Foreign Technical Stock Watch (AUS, HK & FSSTI) Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy or completeness is not guaranteed and opinions are subject to change without notice. This report is for information only and not to be construed as a solicitation for contracts. We accept no liability for any direct or indirect loss arising from the use of this document. We, our associates, directors, employees may have an interest in the securities and/or companies mentioned herein. for TA SECURITIES HOLDINGS BERHAD (14948-M) MENARA TA ONE, 22 JALAN P. RAMLEE, 50250 KUALA LUMPUR, MALAYSIA TEL: +603-20721277 / FAX: +603-20325048 (A Participating Organisation of Bursa Malaysia Securities Berhad) Kaladher Govindan – Head of Research
2. Daily Note Daily Market Commentary Friday , 21 July 2017 (A Participating Organisation of Bursa Malaysia Securities Bhd) Menara TA One, 22 Jalan P Ramlee, 50250 Kuala Lumpur Tel : 603 - 2072 1277. Fax : 603 - 2032 5048 TA Research e-mail : taresearch@ta.com.my For Internal Circulation Only Review & Outlook KLSE Market Statistics (20.07.2017) (mil) Main Market 1,210.0 Warrants 85.1 ACE Market 414.3 Bond 9.8 ETF 0.0 Total 1,719.2 Off Market 135.5 Volume +/-chg (RMmn) -220.3 1,893.9 -126.4 8.9 -108.7 102.4 2.5 2.0 -0.03 0.0 2,007.2 36.2 618.8 Value +/-chg -240.9 -8.4 -35.5 0.6 -0.03 311.1 Major Indices Index +/- chg Malaysia FBMKLCI FBMEMAS FBMSCAP July Futures Other Markets DOW JONES NASDAQ (US) FTSE (UK) NIKKEI (JAPAN) KOSPI (KOREA) HANG SENG (HK) FSSTI (S'PORE) SET (BANGKOK) JCI (JAKARTA) SHANGHAI SHENZHEN AUSTRALIA 1,755.63 12,516.72 17,252.78 1,756.50 21,611.78 6,390.00 7,487.87 20,144.59 2,441.84 26,740.21 3,293.13 1,575.28 5,825.21 3,244.87 1,847.97 5,761.45 Off Market (mn) CIMB 90.5 PTRANS 10.0 BERTAM 5.6 MEXTER 5.0 SMRT 5.0 SWSCAP 5.0 MATRIX 4.0 OMESTI 3.0 SIME 2.0 CUSCAPI-WA 1.8 YOCB 1.0 @ @ @ @ @ @ @ @ @ @ @ (RM) 6.31 0.30 0.51 0.26 0.18 1.00 2.70 0.45 9.56 0.06 1.45 Exchange Rate USD/MYR 4.2918 0.0068 USD/JPY 112.31 0.2800 EUR/USD 1.151 -0.0019 -1.64 -17.75 -27.78 -2.50 Value/ Volume 1.57 0.10 0.25 0.20 1.58 1.17 4.57 Up Down 279 338 45 81 44 45 3 1 2 0 373 465 % chg % YTD chg -0.09 -0.14 -0.16 -0.14 6.94 9.16 17.24 7.40 -28.97 -0.13 4.96 0.08 56.96 0.77 123.73 0.62 11.90 0.49 68.05 0.26 -31.94 -0.96 -0.57 -0.04 18.52 0.32 13.89 0.43 8.92 0.48 29.33 0.51 Top 10 KLCI Movers Mkt Cap. Counter Mkt Cap. (RM’mn) MAYBANK 101,378 TENAGA 79,679 IHH 57,119 AXIATA 43,192 PETGAS 36,963 DIGI 36,854 IOICORP 32,073 TM 23,863 PETDAG 23,485 HAPSENG 22,532 9.36 18.70 4.83 5.39 20.50 21.54 14.31 2.10 9.98 4.55 -6.15 1.69 Based on Chg Vol. (RM) (mn) -0.02 13.24 -0.04 9.45 -0.11 21.32 -0.03 2.62 -0.18 1.52 -0.05 4.05 -0.02 0.73 -0.04 1.56 -0.06 0.41 -0.03 0.41 Commodities Futures Palm Oil (RM/mt) 2,577.00 54.00 Crude Oil ($/Barrel) 46.73 -0.36 Gold ($/tr.oz.) 1,243.90 3.00 Important Dates MIKROMB - 2:5 Bonus Issue - BI of 123.7m shares. 2 bonus shares for every 5 existing shares. LISTING ON: 21/07/2017. VITROX - 1:1 Bonus Issue - BI of 236.3m shares. 1 bonus share for every 1 existing share. Entitlement Date: 21/07/2017. LISTING ON: 24/07/2017. Local stocks slipped back into sideways trading Thursday, as investors stayed in profit-taking mode due to weak follow-through buying interest in spite of record closes on the overnight Wall Street market. The KLCI eased 1.64 points to settle at 1,755.63, off the opening high of 1,759.85 and low of 1,753.96, as losers beat gainers 465 to 373 on lower turnover of 1.72bn shares worth RM2bn. Range bound trade should persist today, given the absence of positive local catalysts ahead of the weekend, and investor caution over the closely watched ECB meeting. Immediate support from the 100-day moving average at 1,755 must hold to prevent further slide on the index to 1,729, a key support level in April, while crucial uptrend support is from the 200-day moving average at 1,707. Immediate resistance stays at the 50-day moving average now at 1,772, next 1,782, followed by the recent peak of 1,796. Any further price weakness on Mudajaya towards the 100-day moving average (RM1.21) or 50%FR (RM1.20) should attract buying support ahead of oversold rebound towards the 76.4%FR (RM1.45), with next resistance from RM1.55 and the 23/5/17 peak (RM1.67). Suncon shares need convincing strength above the 123.6%FP (RM2.08) to target the 138.2%FP (RM2.21), 150%FP (RM2.32) and 161.8%FP (RM2.42) ahead. Key chart support from the lower Bollinger band (RM1.98) is reinforced by the 100-day moving average (RM1.93). News Bites • Maxis Bhd's 1H17 earnings rose 7.2% to RM1.1bn from RM1.0bn in the previous corresponding period. It was within expectations. • Westports Holdings Bhd's 1H17 net profit of RM289.7mn came within expectations. • British American Tobacco (Malaysia) Bhd's net profit for 1HFY17 improved by 17.2% YoY to RM258.3mn. It was within our expectation but below consensus. • UOA Real Estate Investment Trust's 2Q17 net rental income fell 15% to RM14.6mn, from RM17.1mn a year ago, on lower gross rental. • For 1H17, Syarikat Takaful Malaysia Bhd's net profit grew 10% YoY to RM101.8mn from RM92.2mn, while revenue was up 5% YoY to RM1,145.2mn from RM1,095.5mn. • Felda Global Ventures Holdings Bhd's board of directors has disbanded a 3 member board executive committee set up to take over the duties and responsibilities of the group president and CEO Datuk Zakaria Arshad in his absence, to appoint Datuk Khairil Anuar Aziz as Officer-In-Charge with immediate effect. • Tien Wah Press Holdings Bhd is ceasing its printing business in Malaysia, which will result in 237 employees being laid off. • Following the failed bid to privatize the company last year, Hwang Capital (M) Bhd's largest shareholders have proposed to undertake a selective capital reduction and have proposed to pay the entitled shareholders RM260.7mn or RM2.94 per share. • VS Industry Bhd's 43.5%-owned Hong Kong listed unit, VS International Group Ltd, has proposed a 1-for-4 rights issue to raise between HK$105.8mn and HK$114.5mn to fund its business expansion in China. • Mah Sing Group Bhd has launched its M Vertica Sales Gallery located in Cheras, which has an estimated GDV of RM2.2bn. • Gabungan AQRS Bhd has inked a MoU with Singapore's Tera Capital Pte Ltd to jointly develop its One Jesselton Waterfront mixed development in Kota Kinabalu, Sabah. • Kerjaya Prospek Group Bhd has secured a RM64.2mn contract from Kerjaya Prospek Property Sdn Bhd to undertake a construction project in Jalan Puchong, Kuala Lumpur. • Careplus Group Bhd has proposed to place out new shares to third party investors to raise RM18.8mn to finance the expansion of its production facilities. • Bina Darulaman Bhd has launched 2 integrated township projects with an estimated GDV of RM2.6bn under its Life Series development to satisfy market demand for residential space that offers social and lifestyle elements. • Amcorp Properties Bhd announced today that it has mutually extended validity of its 50:50 0real estate JV in Spain with Grosvenor Group Ltd to 9 years, from 5 previously. • Rev Asia Bhd is in talks with 2 companies as part of its plan to expand its business within the digital space in the Asean region. • The Asian Development has raised its growth outlook for the economies of developing Asia by 5.9% in 2017, up 0.2 percentage points from its earlier forecast made in April. • The Bank of Japan left its massive monetary stimulus unchanged and pushed back the timeframe to achieve its 2% inflation target. • The United States and China failed to agree on major new steps to reduce the US trade deficit with China, casting doubt over President Donald Trump's economic and security relations with Beijing • Policy makers at the European Central Bank haven't yet discussed the future of their bond-purchase program after its tentatively scheduled end in December, but will do so in the fall, ECB President Mario Draghi said. DISCLAIMER The information in this report has been obtained from sources believed to be reliable. Its accuracy or completeness is not guaranteed and opinions are subject to change without notice. This report is for information only and not to be construed as a solicitation for contracts. We accept no liability for any direct or indirect loss arising from the use of this document. We, our associates, directors, employees may have an interest in the securities and/or companies mentioned herein. for TA SECURITIES HOLDINGS BERHAD Kaladher Govindan, Head of Research
3. TA Securities Friday , July 21, 2017 FBMKLCI: 1,755.63 A Member of the TA Group MENARA TA ONE, 22 JALAN P. RAMLEE, 50250 KUALA LUMPUR, MALAYSIA TEL: +603-20721277 / FAX: +603-20325048 Daily Brief Market View, News In Brief: Corporate, Economy, and Share Buybacks THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* TA Research Team Coverage Market View Tel: +603-2072 1277 taresearch@ta.com.my www.taonline.com.my Range Bound Ahead of the Weekend Local stocks slipped back into sideways trading Thursday, as investors stayed in profittaking mode due to weak follow-through buying interest in spite of record closes on the overnight Wall Street market. The KLCI eased 1.64 points to settle at 1,755.63, off the opening high of 1,759.85 and low of 1,753.96, as losers beat gainers 465 to 373 on lower turnover of 1.72bn shares worth RM2bn. Break Below 1,755 to Test 1,729 Range bound trade should persist today, given the absence of positive local catalysts ahead of the weekend, and investor caution over the closely watched ECB meeting. Immediate support from the 100-day moving average at 1,755 must hold to prevent further slide on the index to 1,729, a key support level in April, while crucial uptrend support is from the 200day moving average at 1,707. Immediate resistance stays at the 50-day moving average now at 1,772, next 1,782, followed by the recent peak of 1,796. Buy Mudajaya & Suncon Any further price weakness on Mudajaya towards the 100-day moving average (RM1.21) or 50%FR (RM1.20) should attract buying support ahead of oversold rebound towards the 76.4%FR (RM1.45), with next resistance from RM1.55 and the 23/5/17 peak (RM1.67). Suncon shares need convincing strength above the 123.6%FP (RM2.08) to target the 138.2%FP (RM2.21), 150%FP (RM2.32) and 161.8%FP (RM2.42) ahead. Key chart support from the lower Bollinger band (RM1.98) is reinforced by the 100-day moving average (RM1.93). Asian Markets Higher Ahead of ECB Meet Asian stock markets traded higher on Thursday as investors digested the Bank of Japan's announcements and awaited decisions from the European Central Bank and Indonesia. The BOJ kept monetary policy steady as expected. It raised its economic growth forecasts while once again pushing back its inflation target. The central bank now expects inflation to be at 1.1 percent for the current fiscal year, down from its previous forecast of 1.4 percent. For the next financial year, it expects inflation to hit 1.8 percent instead of 1.9 percent. The Nikkei shares average rose 0.62 percent to 20,144.59 driven by robust exports data in June, the seventh straight monthly gain. Korean shares climbed for the sixth straight session, as both foreign investors and domestic institutions bought up local equities. Kospi ended 0.49 percent higher to 2,441.84 points. In down under, the benchmark ASX200 ended higher by 0.51 percent to close at 5,761.50 helped by a 8.3 percent surge in Santos, after the company raised its output guidance for the year and said it continued to make progress on cutting costs and debt. In China, major stock indexes rose for a third straight day, with sentiment lifted by expectations of robust first-half corporate earnings. The blue-chip CSI300 index rose 0.49 percent to 3,747.88 points, while the Shanghai Composite Index gained 0.44 percent to 3,245.33 points. Page 1 of 9
4. TA Securities 21-Jul-17 A Member of the TA Group Home Depot Dragged Dow Lower U .S stock markets closed little changed on Thursday as a deal between Sears and Amazon weighed on home improvement retailers while gains in Microsoft helped buoy the Nasdaq. Shares of appliance retailers fell after Sears said it would sell its Kenmore home appliances on Amazon. Sears shares jumped 11 percent, while shares of Lowe’s fell 5.6 percent and Home Depot fell 4 percent. Best Buy, which also sells appliances, dropped 3.9 percent. Microsoft shares rose 0.9 percent in after-hours trading to $74.89 after it reported a quarterly profit that more than doubled, helped by a tax benefit and strong growth in its cloud business. Overall, most companies have reported solid quarterly results thus far in the earnings season. Of the 76 S&P 500 companies that have reported as of Thursday morning, 76 percent have topped earnings expectations while 74 percent have exceeded sales estimates, according to data from The Earnings Scout. The Dow Jones Industrial Average fell 28.97 points, or 0.13 percent, to 21,611.78, the S&P 500 lost 0.38 points to 2,473.45 and the Nasdaq Composite rose 4.96 points, or 0.08 percent, to 6,390.00. Page 2 of 9
5. TA Securities 21-Jul-17 A Member of the TA Group News In Brief Corporate Felda Global Ventures Holdings Bhd 's (FGV) board of directors has disbanded a 3 member board executive committee set up to take over the duties and responsibilities of the group president and CEO Datuk Zakaria Arshad in his absence, to appoint Datuk Khairil Anuar Aziz as Officer-In-Charge with immediate effect. The committee consisted of FGV directors Datuk Dr Omar Salim and Datuk Mohd Zafer Mohd Hashim, and head of logistics cluster Azman Ahmad. No reason was given for the move. (Bursa Malaysia/ The Sun) For 1H17, Maxis Bhd’s earnings rose 7.2% to RM1.1bn from RM1.0bn in the previous corresponding period. Its revenue rose 2% to RM4.3bn from RM4.2bn. For FY17, the group expects service revenue, absolute Ebitda and base capital expenditure to remain at similar levels to FY16. (Bursa Malaysia/ The Star) The weak 2Q17 results performance dragged down Westports Holdings Bhd’s net profit for 1H17 by 12.5% to RM289.7mn from RM331.0mn. However, revenue rose 3.5% to RM1.0bn from RM987.3mn a year ago. On prospects, Westports is expecting to see a 7% to 12% YoY drop in container throughput this year due to the ongoing changes in the container shipping industry. (Bursa Malaysia/ The Edge) British American Tobacco (Malaysia) Bhd's net profit for 1HFY17 improved by 17.2% to RM258.3mn from RM220.3mn a year ago. The group registered market share growth to 54.5% in May from 53.5% in 1QFY17. Dunhill, the largest premium brand in the legal market, registered a 38.8% market share in May, up 1.4% from the previous quarter. (Bursa Malaysia/ The Edge) Tien Wah Press Holdings Bhd is ceasing its printing business in Malaysia, which will result in 237 employees being laid off. The cessation may not come as a surprise to many after Tien Wah’s single largest client British American Tobacco (Malaysia) Bhd announced in March last year that it would close its factory in Petaling Jaya in stages. (Bursa Malaysia/ The Edge) Following the failed bid to privatize the company last year, Hwang Capital (M) Bhd’s largest shareholders have proposed to undertake a selective capital reduction and repayment (SCR) exercise that will see them get full control of the company. Its largest shareholder Hwang Enterprises Sdn Bhd and persons acting in concert have proposed to pay the entitled shareholders RM260.7mn or RM2.94 per share under the SCR exercise. (Bursa Malaysia/ The Edge) For the nine-month period, WZ Satu Bhd’s net profit grew 46.3% to RM21.9mn from a year ago. Revenue grew 19.8% to RM410.1mn from RM342.3mn in 9MFY16. WZ Satu also announced the appointment of Tengku Datuk Indera Zubir Tengku Datuk Ubaidillah as CEO of the company effective from Nov 1. (Bursa Malaysia/ The Edge) VS Industry Bhd's 43.5%-owned Hong Kong listed unit, VS International Group Ltd, has proposed a 1-for-4 rights issue to raise between HK$105.8mn (RM58.2mn) and HK$114.5mn (RM62.9mn) to fund its business expansion in China. (Bursa Malaysia/ Bernama) UOA Real Estate Investment Trust's 2Q17 net rental income fell 15% to RM14.6mn, from RM17.1mn a year ago, on lower gross rental. It declared an income distribution per unit (DPU) of 2.06 sen for the quarter, against 2.61 sen in the same period last year. This brought its DPU for the half year to 4.18 sen, versus 5.22 sen in the corresponding period last year. (Bursa Malaysia/ The Edge) Page 3 of 9
6. TA Securities 21-Jul-17 A Member of the TA Group For 1H17 , Syarikat Takaful Malaysia Bhd’s net profit grew 10% to RM101.8mn from RM92.2mn, while revenue was up 5% to RM1,145.2mn from RM1,095.5mn. Going forward, Syarikat Takaful said it is seeking to increase overall market share by emphasising its 4 core areas of customer reach, operational agility, cost competitiveness and stakeholder confidence. (Bursa Malaysia/ The Edge) Mah Sing Group Bhd has launched its M Vertica Sales Gallery located in Cheras. The 11.25acre plot, which was purchased at RM263.5mn or RM538 psf, is situated 800m from Sunway Velocity Mall and has an estimated GDV of RM2.2bn. The proposed development plan for M Vertica includes retail shops and residential suites indicatively priced from RM450,000 or about RM530 psf. (The Edge) Gabungan AQRS Bhd has inked a MoU with Singapore's Tera Capital Pte Ltd to jointly develop its One Jesselton Waterfront mixed development in Kota Kinabalu, Sabah. The proposed JV is in line with Gabungan AQRS's long-term strategic plan to retain the One Jesselton Waterfront development as recurring income assets. (Bursa Malaysia/ The Edge) Kerjaya Prospek Group Bhd has secured a RM64.2mn contract from Kerjaya Prospek Property Sdn Bhd to undertake a construction project in Jalan Puchong, Kuala Lumpur. The contract is expected to commence on Aug 2, 2017 and be completed by Oct 1, 2018. (Bursa Malaysia/ Bernama) Careplus Group Bhd has proposed to place out new shares to third party investors to raise RM18.8mn to finance the expansion of its production facilities. RM8.0mn has been earmarked for construction of a new building. Another RM10.7mn of the proceeds will be used to partially fund 3 additional double-former production lines, which will be installed in the new building upon its completion in 2018. (Bursa Malaysia/ The Edge) Bina Darulaman Bhd has launched 2 integrated township projects under its Life Series development to satisfy market demand for residential space that offers social and lifestyle elements. The projects, namely Darulaman Saujana in Jitra and Darulaman Putra in Sungai Petani, Kedah, have an estimated GDV of RM2.6bn. (Bursa Malaysia/ Bernama) Amcorp Properties Bhd announced today that it has mutually extended validity of its 50:50 0real estate JV in Spain with Grosvenor Group Ltd to 9 years, from 5 previously. The purpose of the Amendments is to allow the JVCo to pursue investment that fall outside of the initial investment criteria as set out in the JVA, which may require longer business plan period. (Bursa Malaysia/ The Edge) Rev Asia Bhd is in talks with 2 companies as part of its plan to expand its business within the digital space in the Asean region. Chairman Datuk Larry Gan Nyap Liou, however declined to identify the two technology-based companies that it is considering to acquire. (The Edge) Page 4 of 9
7. TA Securities 21-Jul-17 A Member of the TA Group News In Brief Economy Asia ADB Raises Asia , China Growth Forecasts The Asian Development has raised its growth outlook for the region on stronger than expected export demand in the first quarter. The economies of developing Asia – comprising 45 countries in Asia Pacific – are expected to grow by 5.9% in 2017, up 0.2 percentage points on the ADB’s earlier forecast made in April. Growth for countries outside South Korea, Singapore, Taiwan, Hong Kong and China was revised upwards to 6.4% in 2017 and 6.3% in 2018. The bank forecasts the Chinese economy will grow 6.7% in 2017 and 6.4% in 2018 amid stronger than expected economic growth the year to date, as consumption has been supported by wage growth and exports have risen. The ADB in April predicted growth at 6.5% in 2017 and 6.2% in 2018. Growth in China is expected to decelerate in the second half of 2017 and into 2018 as the government seeks to reduce financial risks, the ADB said. Consumer price inflation in the region is expected to be lower than previously forecast on low oil prices and good weather keeping food prices stable. Price inflation is expected to fall to 2.6% in 2017 and 3% in 2018, down from 3% and 3.2% respectively. As for Malaysia, household spending is projected to remain healthy but will face downward pressure from elevated inflation and rising servicing costs for household debt. Growth in exports is expected to remain firm, supported by a weaker currency and improvements in global trade. This Supplement revises up the growth forecast for 2017 to 4.7% from 4.4% in ADO 2017. The growth forecast for 2018 is unchanged at 4.6%. (Financial Times/ Asian Development Outlook Supplement) Figure 1: Gross Domestic Product Growth (%) Source: Asian Development Outlook Supplement BoJ Keeps Stimulus Unchanged; Cuts Inflation Forecast The Bank of Japan left its massive monetary stimulus unchanged and pushed back the timeframe to achieve its 2% inflation target. The bank has upgraded its growth forecasts as private consumption and exports are expected to continue moderate increasing trend. The BoJ policy board, led by Governor Haruhiko Kuroda, voted 7-2 to retain the central bank's target of raising the amount of outstanding Japan government bond holdings at an annual pace of about JPY 80 trillion. The BoJ board also voted to retain the -0.1% interest rate on current accounts that financial institutions maintain at the bank. The central bank will Page 5 of 9
8. TA Securities 21-Jul-17 A Member of the TA Group purchase government bonds so that the yield of 10-year JGBs will remain at around zero percent . The bank said risks to both economic activity and prices are skewed to the downside. The growth outlook for the fiscal 2017 was upgraded to 1.8% from 1.6% and that for the fiscal 2018 was upgraded to 1.4% from 1.3%. The bank maintained the fiscal 2019 projection at 0.7%. As price growth has remained relatively weak, the inflation projection for the fiscal 2017 was lowered to 1.1% from 1.4% and the outlook for the fiscal 2018 to 1.5% from 1.7%. In the fiscal 2019, inflation is forecast to be 2.3% instead 2.4%. The timing for annual inflation to reach around 2% will likely be around fiscal 2019, the bank said. Other news in Japan: • Japan had a merchandise trade surplus of Y439.907bn in June that shy of expectations for a surplus of Y488.0bn following the Y204.2bn deficit in May. Exports were up 9.7% while imports climbed an annual 15.5%. • Japan's all industry activity declined at a faster-than-expected pace by 0.9% MoM in May, reversing a 2.3% rise in April. (RTT News/BoJ) Fitch Says China’s Regulation Pledge Could Signal Shift Away from High Growth Targets Fitch Ratings said China’s renewed commitment to contain financial risks signals a possible shift away from high economic growth targets, though policymakers are likely to remain cautious about tightening too aggressively. Chinese regulators and officials emphasized their commitment to tighter financial regulations at the recent National Financial Work Conference. The once-in-five-years meeting typically sets the tone for policy for the subsequent few years. President Xi Jinping said at the conference that a new Financial Stability and Development Committee will be set up under the State Council, or cabinet, and the central bank will take on a bigger role in managing financial market risks. But there is still uncertainty over whether the drive to address risks will continue to take priority if the economy slows, Fitch said. “This could signal rising potential for a more decisive shift in policy focus away from hitting high growth targets, but there is still uncertainty over whether the drive to address risks will continue to take priority if the economy slows,” Fitch said in a statement. The economy expanded a faster-than-expected 6.9% in the second quarter, setting China on course to comfortably meet its 2017 growth target of around 6.5%. (The Star) Indonesia Struggles to Fire Up Its Economy Indonesia is at an impasse with the central bank and the government running out of policy space to fire up the economy. After six interest rate cuts last year, gross domestic product is growing at about 5%, a respectable pace, but not enough to generate the additional revenue that President Joko Widodo needs for his ambitious spending plans and to meet his 7% target. With the budget deficit nearing the mandated ceiling of 3% of GDP and the U.S. gradually tightening monetary policy, Indonesian authorities are finding reduced room to add extra stimulus. After being Asia’s biggest interest-rate cutter in 2016, Bank Indonesia has been on hold this year as inflation ticked up and higher U.S. rates made the economy vulnerable to foreign outflows. The central bank recently loosened rules on the amount of money commercial lenders must hold in reserves, allowing them more flexibility in managing liquidity. (Bloomberg) Australia Jobless Rate Steady at 5.6% in June The unemployment rate in Australia came in at a seasonally adjusted 5.6% in June, the Australian Bureau of Statistics said. That was in line with expectations and unchanged from the May reading following an upward revision from 5.5%. The Australian economy added 14,000 jobs in June, shy of expectations for 15,000 following the downwardly revised 38,000 in the previous month (originally 42,000). The participation rate ticked up to 65.0, exceeding expectations for 64.9, which would have been unchanged. (RTT News) Page 6 of 9
9. TA Securities 21-Jul-17 A Member of the TA Group United States U .S. Jobless Claims Dropped Last Week The number of Americans applying for first-time unemployment benefits fell last week, another signal of a buoyant job market. Initial jobless claims, a proxy for layoffs across the U.S., fell 15,000 to a seasonally adjusted 233,000 in the week ended July 15, the Labor Department said. Economists surveyed by The Wall Street Journal had forecast 243,000 new claims. Last week’s claims were near the lowest level recorded since 1973, but the data comes with the caveat that seasonally adjusted figures can be choppy in early July due to temporary factory shutdowns that vary from year to year. Jobless claims generally have hovered near four-decade lows in recent months, suggesting that employers are holding on to workers. The four-week moving average of initial claims, which evens out weekly volatility, decreased by 2,250 last week to 243,750. (The Wall Street Journal) Philly Fed Index Indicates Notably Slower Growth in July Philadelphia-area manufacturing activity grew at a notably slower rate in the month of July, according to a report released by the Federal Reserve Bank of Philadelphia. The Philly Fed said its index for current manufacturing activity in the region slumped to 19.5 in July from 27.6 in June. While a positive reading still indicates growth in regional manufacturing activity, economists had expected the index to show a much more modest drop to 24.0. The bigger than expected decrease by the headline index was partly due to a notable slowdown in the pace of growth in new orders, as the new orders index tumbled to 2.1 in July from 25.9 in June. The shipments index also slid to 12.2 in July from 28.5 in June, while the number of employees index fell to 10.9 from 16.1. The report said the prices paid index also dipped to 19.1 in July from 23.6 in June, and the prices received index dropped to 9.0 from 20.6. (RTT News) Leading Economic Indicators Index Rises in June A basket of economic indicators rose in June for the sixth consecutive month. The Conference Board’s leading economic index rose 0.6% to 127.8 last month. Economists surveyed by The Wall Street Journal expected a 0.4% gain. Ataman Ozyildirim, director of business cycles and growth research at the Conference Board, said the sharp rise in the index pointed to continued growth in the U.S. economy and moderate improvement in GDP growth in the second half of the year. “The broad-based gain in the U.S. LEI was led by a large contribution from housing permits, which improved after several months of weakness,” Mr. Ozyildirim said. Comprised of 10 components, including initial claims for jobless benefits, factory orders and the S&P 500’s price change, the index is intended to signal swings in the business cycle and to smooth out some of the volatility of individual indicators. The board’s coincident index—designed to reflect current economic conditions and made up of four data points including nonfarm payrolls—rose 0.2% last month after climbing 0.3% in May. The index of lagging indicators rose 0.2% in June after increasing 0.1% in May. (The Wall Street Journal) US, China Fail to Agree on Trade Issues, Casting Doubt on Other Issues The United States and China failed to agree on major new steps to reduce the US trade deficit with China, casting doubt over President Donald Trump's economic and security relations with Beijing. The annual economic dialogue session in Washington ended with canceled news conferences, no joint statement and no new announcements on US market access to China. The two sides had a "frank exchange" but failed to agree on most major bilateral trade and economic issues that were important to the United States, a senior US official said on condition of anonymity because he was not authorized to speak publicly. These included US demands for access to China's financial services markets, reducing excess Chinese steel capacity, reductions in auto tariffs, cutting subsidies for state-owned enterprises, ending Chinese requirements for data localization and lifting ownership caps for foreign firms in China, the official said. (The Business Times) Page 7 of 9
10. TA Securities 21-Jul-17 A Member of the TA Group Europe and United Kingdom ECB to Discuss Bond-Buying Program in the Fall Policy makers at the European Central Bank haven 't yet discussed the future of their bondpurchase program after its tentatively scheduled end in December, but will do so in the fall, ECB President Mario Draghi said. Investors have been looking for further clues as to the future of the program following hints from Mr. Draghi in a speech late last month that it may be time to consider a reduction in stimulus as growth accelerates. But in a news conference on Thursday after the central bank left its policies unchanged, Mr. Draghi said the program’s future had not yet been debated by the 25-member governing council during their two-day meeting in Frankfurt. Their next opportunity will come at a meeting in early September, followed by a gathering in late October. Mr. Draghi also said the euro’s recent appreciation against the U.S. dollar and other currencies had received “some attention” during the meeting. In a statement, the ECB reiterated its readiness to bolster its bondbuying program should economic conditions worsen. Mr. Draghi said that was intended to ensure investors don’t assume to program will be quickly wound down, leading to a rise in borrowing costs before the ECB judges that is needed. The main refi rate was held at a record low zero percent and the deposit rate at -0.40%. The marginal lending facility rate was kept at 0.25%. The bank also retained its asset purchases of EUR 60 billion a month till December 2017, or beyond, if necessary. The size was reduced in March from EUR 80 billion. (The Wall Street Journal) Eurozone Current Account Surplus Shrinks in May The Eurozone’s current account surplus with the rest of the world shrank again in May on the back of a declining goods balance and falling income on foreign assets. The 12-month current account – a measure of the bloc’s external balance in financial flows and trade – shrank from 3.2% of GDP to 3.5% in May, according to the ECB. In seasonally adjusted terms, the surplus was up from EUR23.5bn to EUR30.1bn. The Eurozone has swung dramatically into a current account surplus since its debt crisis struck in 2012. The balance has been driven largely by Germany, whose surplus hit a record of 8.6% of GDP in 2016. (Financial Times) Tight Wheat Supply Risks Leaving U.K. Reliant on Imports Again The U.K., the European Union’s third-largest wheat grower, is entering the new season with the unusual prospect that it may be a net importer of the grain for a second straight year. The crop that farmers are about to start collecting is expected to remain little changed from the 2016 harvest, which was a three-year low. Smaller supply and bigger demand prompted U.K. imports in the 2016-17 season that ended last month to exceed exports for just the fourth time in the past two decades. Local consumption has risen following the reopening of an ethanol plant, where the biofuel is made using feed wheat, the type traditionally favoured by British growers. Supplies of the feed grain may be further tightened after farmers favoured planting more seeds of a variety that’s likely to yield milling wheat, which is used to make bread and fetches a premium. Concerns about a shortage helped push U.K. feed-wheat futures to a three-year high earlier this month. (Bloomberg) German Producer Price Inflation at 5-Month Low Germany's producer price inflation eased to a five-month low in June, data from Destatis showed. Producer prices climbed 2.4% YoY in June, following a 2.8% rise in May. A similar slower pace was last seen in January. Nonetheless, the pace of increase was slightly faster than the expected 2.3%. Excluding energy, producer prices remained unchanged from May and increased 2.5% from the same period of previous year. Energy prices advanced 1.6%in June from last year. Prices of non-durable consumer goods gained 3.9% and that of intermediate goods by 3.2%. Durable consumer goods and capital goods prices moved up 1% each. On a monthly basis, producer prices remained flat after easing 0.2% in May. Economists had forecast prices to drop 0.1%. (RTT News) Page 8 of 9
11. TA Securities 21-Jul-17 A Member of the TA Group Share Buy-Back : 20 July 2017 Company DAIBOCI FIAMMA GLBHD GRANFLO MITRA TEXCHEM Bought Back Price (RM) Hi/Lo (RM) 10,000 1,000,000 100,000 10,000 10,000 1,000 2.20 0.54/0.535 0.60 0.24 1.32 1.38 2.20 0.54/0.535 0.60 0.235/0.23 1.34/1.31 1.38 Total Treasury Shares 96,500 20,820,000 7,901,800 6,507,600 590,000 2,591,000 Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy or completeness is not guaranteed and opinions are subject to change without notice. This report is for information only and not to be construed as a solicitation for contracts. liability for any direct or indirect loss arising from the use of this document. the securities and/or companies mentioned herein. for TA SECURITIES HOLDINGS BERHAD (14948-M) MENARA TA ONE, 22 JALAN P. RAMLEE, 50250 KUALA LUMPUR, MALAYSIA TEL: +603-20721277 / FAX: +603-20325048 (A Participating Organisation of Bursa Malaysia Securities Berhad) Kaladher Govindan – Head of Research Page 9 of 9 We accept no We, our associates, directors, employees may have an interest in
12. For Internal Circulation Only SNAPSHOT OF STOCKS UNDER COVERAGE Company AUTOMOBILE BAUTO MBMR UMW Share Price (RM) 20-Jul-17 1.96 2.23 5.70 Target Price BETA (RM) EPS (sen) PER (X) FY17 FY18 FY17 FY18 Div Yield (%) 52weeks 52weeks FY17 FY18 High Price % Chg Low Price % Chg % Chg YTD 2.37 2.28 5.04 0.94 0.61 1.26 10.3 24.1 19.8 15.8 25.3 30.6 19.0 9.3 28.8 12.4 8.8 18.6 6.0 4.0 2.3 8.1 4.0 3.5 2.44 2.70 6.47 -19.7 -17.4 -11.9 1.88 2.08 4.09 4.3 7.2 39.3 -8.0 4.2 35.0 4.80 3.70 5.70 8.00 17.50 11.00 23.60 5.80 10.00 1.28 0.96 1.32 1.38 0.67 0.96 0.79 1.32 0.70 33.6 29.4 43.9 49.6 105.2 73.4 137.2 50.7 40.3 30.5 33.6 48.4 55.2 115.5 82.9 142.4 54.5 39.0 11.8 8.9 11.4 12.7 14.9 13.1 14.8 10.0 25.0 13.0 7.8 10.3 11.4 13.6 11.6 14.3 9.3 25.8 4.0 3.1 3.5 3.2 2.6 5.2 2.8 2.4 3.4 4.0 3.1 3.6 3.6 2.6 5.2 2.8 2.4 3.4 4.49 3.00 5.70 6.87 16.30 9.68 20.66 5.59 11.14 -11.6 -12.7 -12.3 -8.2 -3.8 -0.6 -1.5 -9.7 -9.5 3.60 2.08 3.90 4.11 12.70 7.50 19.26 4.53 8.20 10.3 26.0 28.2 53.4 23.5 28.3 5.7 11.5 22.9 6.7 9.6 16.0 39.9 16.1 17.3 3.2 7.2 13.9 0.38 1.31 5.24 3.50 0.66 1.17 2.06 1.96 5.98 0.45 1.57 6.00 3.50 0.78 0.58 2.26 1.49 6.26 0.80 0.64 1.05 1.08 1.01 1.28 na 1.10 0.10 5.6 14.6 28.1 15.3 4.9 8.3 12.6 11.9 42.0 5.6 13.5 34.8 20.3 5.7 9.6 12.5 12.0 45.8 6.7 9.0 18.7 22.8 13.2 14.1 16.3 16.4 14.2 6.8 9.7 15.0 17.2 11.5 12.1 16.4 16.4 13.1 0.0 2.1 2.3 2.1 3.8 0.9 2.7 1.5 4.2 0.0 2.1 2.3 2.7 3.8 0.9 2.7 1.5 4.2 0.51 1.37 5.52 3.61 0.74 1.39 2.15 2.48 6.15 -25.5 -4.4 -5.1 -3.0 -10.9 -15.8 -4.2 -20.8 -2.8 0.38 0.89 4.65 3.07 0.37 0.41 1.56 1.50 5.57 1.3 48.0 12.7 14.0 79.5 188.9 32.1 30.6 7.4 -12.6 24.8 9.6 9.4 8.3 103.5 21.2 14.0 1.7 1.97 2.00 0.49 11.0 11.5 17.9 17.1 5.1 5.1 2.19 -10.0 1.93 2.1 -2.0 15.14 17.70 17.84 21.08 0.50 0.59 74.8 93.1 81.3 20.2 101.9 19.0 18.6 17.4 4.9 4.7 5.4 5.2 15.30 19.10 -1.0 -7.3 13.72 15.56 10.3 13.8 8.8 8.1 2.24 7.30 25.10 1.20 83.90 3.76 1.93 4.89 0.91 2.23 8.62 27.41 1.50 88.66 4.10 2.46 4.41 1.23 0.49 0.35 0.32 0.47 0.36 0.48 0.65 0.43 0.57 6.7 26.4 121.1 6.5 290.1 22.3 27.5 15.7 8.1 7.9 40.6 151.0 6.6 327.7 24.7 27.0 16.6 11.6 33.3 27.7 20.7 18.4 28.9 16.9 7.0 31.1 11.2 28.4 18.0 16.6 18.1 25.6 15.2 7.1 29.4 7.8 1.8 1.4 2.8 5.0 3.3 4.0 3.1 0.9 2.8 2.1 2.1 3.0 5.0 3.3 4.5 4.1 1.0 3.9 3.00 8.89 26.52 1.32 85.20 3.89 2.04 5.00 1.07 -25.3 -17.9 -5.4 -9.0 -1.5 -3.3 -5.4 -2.2 -15.4 2.11 7.30 22.44 1.13 74.12 2.26 1.47 4.14 0.78 6.2 0.0 11.9 6.1 13.2 66.3 31.3 18.0 16.0 -12.8 -0.4 6.9 4.3 7.3 48.1 11.6 12.9 13.8 43.88 52.08 1.01 198.6 187.4 22.1 23.4 4.6 4.6 55.46 -20.9 40.61 8.1 -0.7 9.55 5.88 11.51 6.54 1.35 1.29 49.3 25.7 54.7 27.7 19.4 22.9 17.4 21.2 0.5 1.4 0.6 1.5 10.00 6.38 -4.5 -7.8 7.50 4.22 27.4 39.3 20.2 30.1 2.30 0.12 3.34 0.13 0.75 1.26 19.3 0.4 23.2 0.4 11.9 33.1 9.9 33.3 6.1 0.0 7.0 0.0 3.42 0.16 -32.7 -25.0 2.29 0.05 0.4 140.0 -22.3 140.0 5.96 4.21 6.39 4.70 0.77 0.51 9.5 13.3 15.0 16.5 62.5 31.6 39.9 25.6 0.6 1.5 0.6 1.8 6.73 4.37 -11.4 -3.7 5.54 3.85 7.6 9.4 -6.1 0.7 6.80 6.98 1.93 5.70 1.56 6.85 7.60 1.80 6.05 2.20 0.57 0.16 0.34 -0.19 0.30 19.5 35.8 12.3 26.4 3.7 24.6 40.0 15.1 29.8 5.5 34.9 19.5 15.6 21.6 41.8 27.7 17.5 12.8 19.1 28.4 1.2 2.6 1.9 2.3 0.6 1.6 2.9 2.3 2.6 0.9 7.40 7.15 2.38 5.94 2.64 -8.1 -2.4 -18.9 -4.0 -40.9 4.06 5.62 1.88 4.20 1.51 67.5 24.2 2.7 35.7 3.3 40.8 5.9 -8.5 6.5 -33.9 INDUSTRIAL SCIENTX SKPRES 8.73 1.34 9.71 1.75 0.52 0.50 54.5 8.6 66.3 10.6 16.0 15.6 13.2 12.6 2.1 3.1 2.3 3.9 8.99 1.44 -2.9 -6.9 6.01 1.15 45.3 16.5 30.3 3.9 MEDIA ASTRO MEDIA PRIMA STAR 2.53 0.90 2.36 3.45 0.60 1.40 1.05 0.65 0.64 13.2 1.7 7.1 14.5 2.8 6.5 19.1 52.7 33.3 17.5 31.9 36.4 4.9 1.5 7.6 5.1 2.5 7.6 3.01 1.48 2.67 -15.9 -39.2 -11.6 2.51 0.87 2.19 0.8 4.0 7.8 -2.7 -21.7 5.4 -13.8 -2.1 -35.3 -6.5 -4.5 -10.9 -25.2 -69.2 0.20 6.33 0.75 7.03 0.44 6.48 1.33 0.29 205.1 0.9 0.0 5.1 46.0 7.3 18.0 12.3 133.3 -1.7 -18.0 0.5 42.7 -0.4 -3.1 -63.4 -19.7 1.30 22.3 -6.5 BANKS & FINANCIAL SERVICES AFG 3.97 AFFIN 2.62 AMBANK 5.00 CIMB 6.31 HLBANK 15.68 MAYBANK 9.62 PBBANK 20.36 5.05 RHBBANK BURSA 10.08 CONSTRUCTION BPURI GADANG GAMUDA IJM PESONA SENDAI SUNCON WCT LITRAK Building Materials WTHORSE CONSUMER Brewery CARLSBG HEIM Retail AEON AMWAY F&N HUPSENG NESTLE PADINI POHUAT QL SIGN Tobacco BAT GAMING Casino GENTING GENM NFO BJTOTO LUSTER HEALTHCARE Hospitals IHH KPJ Rubber Gloves HARTA KOSSAN SUPERMX TOPGLOV KAREX OIL & GAS DNEX 0.60 0.76 1.03 3.7 4.6 16.2 13.0 1.7 1.7 0.69 LCTITAN 6.39 7.41 na 60.3 71.5 10.6 8.9 4.1 5.5 6.53 MHB 0.75 0.87 1.83 -1.2 1.3 na 57.3 0.0 0.0 1.16 MISC 7.39 6.85 0.79 56.4 48.9 13.1 15.1 4.1 4.1 7.90 PANTECH 0.64 0.69 1.27 4.1 4.9 15.3 12.9 2.8 3.1 0.67 PCHEM 6.95 7.74 1.06 39.2 40.5 17.7 17.2 3.0 3.2 7.80 SENERGY 1.57 1.71 2.49 6.6 4.0 23.8 39.6 0.6 0.6 2.10 UMWOG 0.32 0.80 2.09 -11.7 -3.5 na na 0.0 0.0 1.04 Note: UMWOG proposed rights issue of shares. Ex-Target price RM0.43. For more details please refer to 08.05.17 report. UZMA 1.59 1.55 1.48 12.0 12.6 13.3 12.6 0.0 0.0 1.98
13. For Internal Circulation Only SNAPSHOT OF STOCKS UNDER COVERAGE Company Share Price (RM) PLANTATIONS FGV IJMPLNT IOICORP KLK SIME UMCCA 1.66 3.00 4.49 24.74 9.56 6.49 Target Price BETA (RM) 1.55 3.88 4.15 26.19 10.02 7.52 1.78 0.47 1.07 0.86 1.23 0.43 EPS (sen) PER (X) FY17 FY18 FY17 FY18 4.2 12.3 18.7 111.8 34.0 37.6 8.5 15.7 21.0 119.1 37.5 34.5 39.3 24.4 24.0 22.1 28.1 17.3 19.5 19.1 21.4 20.8 25.5 18.8 Div Yield (%) 52weeks 52weeks FY17 FY18 High Price % Chg Low Price % Chg 3.0 2.3 2.2 2.2 2.6 3.5 3.0 2.7 2.7 2.4 3.2 2.6 2.52 3.70 4.81 25.50 9.70 6.58 -34.1 -18.9 -6.7 -3.0 -1.4 -1.4 1.42 2.96 4.21 22.92 7.42 5.53 PROPERTY GLOMAC 0.64 0.70 0.56 1.6 6.3 39.8 10.1 4.7 4.7 0.83 -23.0 0.61 HUAYANG 0.90 0.96 0.67 17.3 10.2 5.2 8.8 4.5 2.2 1.43 -37.5 0.90 IBRACO 0.92 1.00 0.37 5.2 11.1 17.6 8.3 3.8 4.3 1.05 -12.4 0.76 IOIPG 2.13 2.25 0.86 17.4 17.4 12.2 12.2 3.3 3.5 2.46 -13.4 1.85 MAHSING 1.54 1.76 0.73 14.3 13.5 10.8 11.4 4.2 4.2 1.70 -9.4 1.34 SNTORIA 0.85 0.98 0.27 6.2 10.3 13.8 8.2 1.2 1.2 1.00 -15.0 0.69 SPB 4.95 5.98 0.59 25.6 22.8 12.7 14.3 2.4 2.4 5.19 -4.6 4.32 SPSETIA 3.26 4.10 0.68 27.1 29.5 15.3 14.1 4.3 4.3 4.50 -27.6 2.90 SUNWAY 4.14 4.15 0.48 18.3 18.4 13.2 13.0 2.9 2.9 4.20 -1.4 2.84 Note: SUNWAY proposed bonus issue of shares and warrants. Ex-Target price RM1.69. For more details please refer to 15.06.17 report. REIT SUNREIT 1.69 1.86 0.51 8.9 10.1 19.1 16.7 5.2 6.0 1.84 -8.2 1.63 CMMT 1.56 1.72 0.59 8.1 8.6 19.3 18.1 5.4 5.7 1.72 -9.3 1.45 % Chg YTD 16.9 1.4 6.7 7.9 28.8 17.4 7.1 -11.8 2.0 3.1 18.0 8.2 4.1 0.0 21.9 15.3 14.9 23.2 14.5 12.4 45.7 -8.6 -20.8 -8.0 9.3 7.7 6.2 12.0 4.2 38.0 3.7 7.6 -1.7 2.0 POWER & UTILITIES MALAKOF PETDAG PETGAS TENAGA YTLPOWR 1.04 23.64 18.68 14.08 1.41 1.13 21.47 19.60 17.37 1.90 0.76 0.76 0.77 1.02 0.53 7.1 98.4 88.2 131.9 8.2 6.4 102.3 101.3 130.8 10.7 14.6 24.0 21.2 10.7 17.1 16.2 23.1 18.4 10.8 13.2 6.7 3.1 3.3 3.1 7.1 5.8 3.2 3.8 3.3 7.1 1.80 25.70 22.50 14.90 1.64 -42.2 -8.0 -17.0 -5.5 -14.0 1.01 22.92 18.10 13.00 1.39 3.0 3.1 3.2 8.3 1.4 -24.1 -0.7 -12.3 1.3 -5.4 TELECOMMUNICATIONS AXIATA DIGI MAXIS TM 4.73 4.74 5.53 6.35 5.25 4.90 5.85 7.50 1.31 0.93 0.71 0.66 14.6 20.0 25.5 21.4 16.0 20.4 25.7 22.3 32.4 23.7 21.7 29.6 29.6 23.2 21.5 28.5 1.5 4.2 3.6 3.0 1.7 4.3 3.6 3.2 5.99 5.19 6.60 6.90 -21.0 -8.7 -16.2 -8.0 4.11 4.63 5.48 5.81 15.1 2.4 0.9 9.3 0.2 -1.9 -7.5 6.7 TECHNOLOGY Semiconductor & Electronics IRIS 0.17 INARI 2.45 MPI 13.86 UNISEM 3.70 0.28 2.30 15.60 3.95 1.34 0.79 0.51 0.82 -2.6 10.3 94.2 26.9 -0.3 na 12.4 23.8 112.9 14.7 27.1 13.7 na 19.8 12.3 13.7 0.0 3.3 1.9 3.2 0.0 2.0 1.9 3.2 0.24 2.49 13.90 3.72 -29.2 -1.6 -0.3 -0.5 0.10 1.50 7.20 2.27 70.0 63.7 92.5 63.0 54.5 47.6 87.0 56.8 3.27 8.74 3.34 8.10 1.12 1.44 37.6 17.2 37.1 17.5 8.7 50.7 8.8 50.0 1.2 1.1 1.5 1.1 3.59 9.45 -8.9 -7.5 2.16 5.76 51.4 51.7 42.8 44.2 1.73 3.66 2.05 4.05 0.75 0.67 14.3 17.1 22.7 15.1 12.1 21.3 7.6 24.2 2.5 3.5 4.0 3.1 1.87 4.59 -7.5 -20.3 1.47 3.61 17.7 1.4 8.8 -14.9 TRANSPORTATION Airlines AIRASIA AIRPORT Freight & Tankers TNLOGIS WPRTS SNAPSHOT OF FOREIGN STOCKS UNDER COVERAGE Company Share Price (S$) BANKS & FINANCIAL SERVICES DBS 21.45 OCBC 11.05 UOB 23.66 PLANTATIONS WILMAR IFAR 3.32 0.47 Target Price Beta (S$) EPS (cent) PER (X) FY17 FY18 FY17 FY18 Div Yield (%) 52week 52week FY17 FY18 High Price % Chg Low Price % Chg % Chg YTD 23.30 12.00 25.40 1.22 1.14 1.09 173.8 87.7 195.6 190.2 12.3 92.4 12.6 209.3 12.1 11.3 12.0 11.3 2.8 5.7 3.0 2.8 6.7 3.0 22.0 11.3 24.3 -2.3 -1.8 -2.6 14.72 8.84 17.51 45.7 33.6 35.1 23.7 23.9 16.0 3.72 0.53 0.91 1.12 28.9 4.9 31.1 5.2 10.7 9.1 2.4 2.5 2.7 2.7 4.0 0.6 -17.0 -21.0 2.97 0.44 11.8 6.8 -7.5 -10.5 11.5 9.7 BUY : Total return within the next 12 months exceeds required rate of return by 5%-point. HOLD : Total return within the next 12 months exceeds required rate of return by between 0-5%-point. SELL : Total return is lower than the required rate of return. Total Return is defined as expected share price appreciation plus gross dividend over the next 12 months. Gross dividend is excluded from total return if dividend discount model valuation is used to avoid double counting. Required Rate of Return of 7% is defined as the yield for one-year Malaysian government treasury plus assumed equity risk premium.
14. RESULTS UPDATE TA Securities Friday , July 21, 2017 FBMKLCI: 1,755.63 Sector: Consumer A Member of the TA Group MENARA TA ONE, 22 JALAN P. RAMLEE, 50250 KUALA LUMPUR, MALAYSIA TEL: +603-20721277 / FAX: +603-20325048 British American Tobacco (Malaysia) Berhad TP: RM52.08 (+18.7%) Illicit Cigs Market Share Reduced After 10 Months Last Traded: RM43.88 Buy THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Damia Othman Tel: +603-2167-9602 damia@ta.com.my Review BAT’s 1HFY17 earnings came in within our full-year forecasts at 47% but below consensus full-year estimates at 42%. Excluding exceptional items (RM0.8mn), the adjusted net profit improved by 21.3% YoY to RM266.9mn. This is on the back of lower costs of sales and operating expenses. Despite revenue dropped by 22.1% YoY to RM1.5bn due to decline in domestic sales and cessation of contract manufacturing for exports, EBIT was stagnant at RM355.8mn (+0.6 YoY) attributable to reduction in costs of sales and operating expenses from i) overheads savings from cost base transformation, ii) lower recharges from related entities iii) timing of spends and iv) rental income from sub-lease of unutilised space. www.taonline.com.my Share Information Bloomberg Code Stock Code Listing Share Cap (mn) Market Cap (RMmn) 52-wk Hi/Lo (RM) 12-mth Avg Daily Vol ('000 shrs) Estimated Free Float (%) Beta Major Shareholders (%) British American Tobacco Pls Aberdeen Employee Provident Fund ROTH MK 4162 Main Market 285.5 12,527.7 55.46/40.61 273.2 40.9 1.0 50% 6% 6% Forecast Revision 2QFY17 adjusted net profit grew by 22.7% QoQ to RM147.1mn attributable to lower costs of sales and operating expenses similarly to the reasons mentioned above. Furthermore, BAT’s Premium brand; Dunhill recorded a market share of 38.8% as of May-17(+1.4p.p from Mar-17) while the Aspiration Premium brands; Peter Stuyvesant and Pall Mall’s market share were 11.8% as of May-17 (-0.1p.p from Mar-17). Forecast Revision (%) Core Net Profit (RMmn) Consensus TA's / Consensus (%) Previous Rating Financial Indicators Overall, BAT’s market share reduced by 13.0% YoY in 2HFY17 which was higher than the decline in total industry volume by 9.3% YoY within the same period. Worth noting, the legal volume share has increased by 1.0p.p QoQ due to the stricter enforcement from the Department of Customs. Net debt/ equity (%) ROE (%) ROA (%) NTA/Share (RM) Price/NTA (x) The board declared a second interim dividend of 43sen/share (45sen/share in 2QFY16), tax exempt under the single-tier tax system for the quarter under review. Scorecard Impact No change in earnings forecast Outlook Illicit cigarette trades will continue to be a concern to the tobacco industry, however the Malaysian authorities are curbing the threat through tighter enforcements. Furthermore, we do not expect an increase in excise duty this year as focus is shifted to regaining the tax revenue loss from the illicit market. vs TA vs Consensus Share Performance (%) Price Change 1 mth 3 mth 6 mth 12 mth Page 1 of 3 FY17 13.9 92.7 49.8 0.7 75.2 FY18 14.6 90.5 50.8 0.6 91.9 % of FY17 47 42 Within Below BAT FBM KLCI 0.2 (1.1) (5.7) (0.0) 0.5 5.5 (19.1) 5.9 (12-Mth) Share Price relative to the FBM KLCI Our inhouse estimate for Ringgit in 2018 is MYR4.15/USD (c. MYR4.25/USD for 2017), hence we expect a reduction in cost of sales in FY18 due to the cheaper imported cigarettes from Indonesia, Singapore and Korea. Management guided that the imports of products are hedged through a yearlong fixed exchange rate. Even though the share price has reduced by 6.8% since the last quarter financial results, we do believe that BAT has the stability and experience to implement the transformation initiative successfully in Malaysia and we can expect full year benefits from FY18 onwards. FY17 FY18 0.0 0.0 567.0 535.2 636.5 677.2 89.1 79.0 Hold (Upgraded) Source: Bloomberg
15. TA Securities 21-Jul-17 A Member of the TA Group Valuation We made no change to our target price of RM52 .08/share (WACC: 6.3%, g: 2.4%) based on DCF valuation. With a potential total upside of 22.5%, we upgrade our call from Hold to BUY. Downside risk to our call are i) higherthan-expected operating expenses, ii) growth in illicit market share and iii) over-estimated consumer confidence for 2H17. 1QFY17 Results Analysis (RMmn) FYE 31 December Revenue Cost of sales Gross Profit EBITDA Depreciation & amortisation EBIT Exceptional items Net interest Profit before tax Taxation Reported net profit Adj. Net Profit 2QFY16 962.6 (637.5) 325.1 120.1 (1.5) 118.6 (3.2) (2.0) 116.6 (68.7) 47.9 44.7 1QFY17 770.7 (514.4) 256.3 159.3 (1.4) 157.9 1.1 (1.5) 156.4 (37.6) 118.8 119.9 2QFY17 774.1 (492.8) 281.3 199.2 (1.3) 197.9 (0.3) (3.9) 194.0 (46.7) 147.3 147.1 QoQ (%) 0.4 (4.2) 9.7 25.0 (6.2) 25.3 nm >100 24.0 24.1 24.0 22.7 YoY (%) (19.6) (22.7) (13.5) 65.9 (13.7) 66.9 (91.9) 96.9 66.4 (32.0) >100 >100 2HFY16 1,983.6 (1,305.0) 678.6 364.6 (10.9) 353.7 (3.3) (6.0) 347.7 (124.3) 223.4 220.1 2HFY17 1,544.8 (1,007.2) 537.6 358.5 (2.7) 355.8 0.8 (5.4) 350.4 (84.3) 266.1 266.9 YoY (%) (22.1) (22.8) (20.8) (1.7) (74.8) 0.6 nm (10.3) 0.8 (32.2) 19.1 21.3 207.1 (4.4) (68.9) % pts 13.2 13.3 12.9 34.8 14.1 78.3 100.0 357.3 93.2 83.0 179.5 17.8 18.4 17.5 (35.7) 11.3 23.0 23.2 22.7 (24.0) 17.2 19.0 (17.0) (49.8) % pts 5.2 4.8 5.2 11.7 6.0 Basic EPS DPS Dividend Payout (sen) (sen) (%) 16.8 45.0 267.9 41.6 40.0 96.2 51.6 43.0 83.3 EBIT Margin EBITDA Margin PBT Margin Tax Rate Net Profit Margin (%) (%) (%) (%) (%) 12.3 12.5 12.1 (58.9) 5.0 20.5 20.7 20.3 (24.0) 15.4 25.6 25.7 25.1 (24.1) 19.0 24.0 7.5 (13.3) % pts 5.1 5.1 4.8 nm 3.6 Industry volume BAT Volume; Domestic and duty free Contract manufacturing (bn) 2.0 1.8 1.8 0.5 (9.3) 4.1 3.6 (10.7) (bn) (bn) 1.3 1.8 1.1 2.0 1.1 nm 6.2 nm (10.1) nm 2.7 3.8 2.2 2.0 (16.9) (45.9) Earnings Summary (RMmn) FYE 31 Dec Revenue Cost of sales Gross profit EBITDA EBIT Exceptional Item Reported PBT Taxation Reported net profit Adj. Net profit Adj. EPS EPS Growth PER Net Dividend Dividend Yield (sen) (%) (x) (sen) (%) FY15 FY16 FY17E FY18F FY19F 4,581.5 (2,907.4) 1,674.1 1,201.2 1,240.2 3.2 1,231.0 (320.9) 910.1 913.3 3,756.4 (2,486.8) 1,269.6 906.3 919.0 142.7 908.5 (187.2) 721.3 864.0 3,079.1 (2,083.7) 995.5 709.8 715.3 708.8 (141.8) 567.0 567.0 2,868.2 (1,931.7) 936.5 671.8 675.5 669.0 (133.8) 535.2 535.2 2,671.7 (1,794.6) 877.2 629.2 634.0 626.2 (125.2) 501.0 501.0 319.9 0.9 19.7 312.0 5.0 302.6 (20.7) 19.7 278.0 5.6 198.6 (21.4) 28.9 200.0 3.5 187.4 (5.6) 30.7 200.0 3.5 175.4 (6.4) 32.8 200.0 3.5 Page 2 of 3
16. TA Securities 21-Jul-17 A Member of the TA Group (THIS PAGE IS INTENTIONALLY LEFT BLANK) Stock Recommendation Guideline BUY : HOLD : SELL : Not Rated: Total return within the next 12 months exceeds required rate of return by 5%-point. Total return within the next 12 months exceeds required rate of return by between 0-5%-point. Total return is lower than the required rate of return. The company is not under coverage. The report is for information only. Total Return is defined as expected share price appreciation plus gross dividend over the next 12 months. Required Rate of Return of 7% is defined as the yield for one-year Malaysian government treasury plus assumed equity risk premium. Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy or completeness is not guaranteed and opinions are subject to change without notice. This report is for information only and not to be construed as a solicitation for contracts. We accept no liability for any direct or indirect loss arising from the use of this document. We, our associates, directors, employees may have an interest in the securities and/or companies mentioned herein. for TA SECURITIES HOLDINGS BERHAD(14948-M) (A Participating Organisation of Bursa Malaysia Securities Berhad) Kaladher Govindan – Head of Research Page 3 of 3
17. RESULTS UPDATE TA Securities Friday , July 21, 2017 FBMKLCI: 1,755.63 Sector: Telco A Member of the TA Group MENARA TA ONE, 22 JALAN P. RAMLEE, 50250 KUALA LUMPUR, MALAYSIA TEL: +603-20721277 / FAX: +603-20325048 1 Maxis Berhad TP: RM5.85 (+5.8%) Last Traded: RM5.53 Better Valuations Amid Reduced Risk of Dividend Cuts HOLD THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Paul Yap, CFA Tel: +603-2167 9603 paulyap@ta.com.my Review Maxis announced a 1HFY17 core profit of RM998mn (-5.8% QoQ, +9.5% YoY). Within estimates, this represented 53.5% and 52.3% of ours and consensus estimates. Dividends were stable from the previous year, as a second interim dividend of 5.0sen/share (YTD: 10.0sen/share) was declared. QoQ. Considering the competitive landscape, we opine the group delivered a good set of results. Mobile service revenue (-0.6% QoQ) moderated at a softer pace, as postpaid strength helped offset prepaid subscriber churns (-167k). Postpaid subscriber net adds remained encouraging (+42k), driven by the adoption of MaxisONE Plan (MOP). However, unlike a reversal seen at Digi, prepaid subscriber churns continued for the 8th consecutive quarter due to sim consolidation. Higher traffic charges (+3.8% QoQ) and operation & maintenance (+22.7% QoQ) expenses led to a fall in profits. YoY. Service revenue increased 1.8% YoY, underpinned by an uplift in ARPU. As a percentage of its subscriber base, the higher ARPU MOP and Hotlink FAST users improved 18.6pp and 14.6pp to 66.5% and 21.7%. Leading to higher margins, cost increases were cushioned by savings in marketing expenses (-16.3% YoY). Postpaid revenues increased 0.6% YoY. Postpaid subscribers have reported net adds for four consecutive quarters now, delivering a YoY increase of 142k subscribers. Postpaid ARPU remained stable at RM101. Nevertheless, we remain cautious on postpaid threats in the 2H2017, as Digi and U Mobile gains increased access to low band spectrum, coupled with efforts by Celcom to improve its network quality. Meanwhile, prepaid revenues increased 1.3% YoY. Prepaid subscriber churns (-620k), were more than offset by gains in prepaid ARPU (+8.8% YoY. There are now 1.9mn Hotlink FAST subscribers, with a higher average ARPU of RM44. Negatively, weak prepaid subscriber trends sustained, declining for the 8th consecutive quarter. This was attributed to the impact of SIM consolidation, while we believe prepaid to postpaid migration might have also played a part. Aiming to differentiate itself on a superior network quality and unmatched customer experience basis, it expanded its 4G population coverage to 89%. It has also not seen a reduction in its network quality, despite a reduced 900MHz and 1800MHz spectrum portfolio. Representing customer satisfaction, its TP-NPS score stood at an all-time high. 1 2 1 Share Information Bloomberg Code Stock Code Listing Share Cap (mn) Market Cap (RMmn) 52-wk Hi/Lo (RM) 12-mth Avg Daily Vol ('000 shrs) Estimated Free Float (%) Beta Major Shareholders (%) MAXIS MK 6012 Main Market 7,210.5 43,192.1 6.60/5.48 3,190.6 13.4 0.71 Binariang GSM - 62.4 EPF - 10.3 Skim Amanah Saham Bumiputera - 8.1 Forecast Revision (%) Forecast Revision (%) Core Net Profit (RMm) Consensus TA/Consensus (%) Previous Rating FY17 FY18 2.6 2.6 1,914 1,930 1,916 1,904 99.9 101.4 Hold (Upgraded) Scorecard % of FY 53.5 52.3 Within Within Net debt/EBITDA (x) FCF per share (RM) P/FCF (x) ROA (%) ROE (%) NTA/Share (RM) P/NTA (x) FY17 1.4 67.1 8.2 33.5 9.6 (0.6) (10.0) FY18 1.3 46.7 11.8 27.9 9.5 (0.5) (11.8) Share Performance Price Change (%) 1 mth 3 mth 6 mth 12 mth Maxis (1.1) (14.1) (7.7) (8.7) FBMKLCI (1.1) (0.0) 5.5 5.9 vs TA vs Consensus Financial Indicators (12-Mth) Share Price relative to the FBM KLCI Impact Increasing our postpaid revenue assumptions, we raise our FY17/FY18/ FY19 earnings by 2.6-2.7% to RM1,914mn/RM1,930mn/RM1,885mn. Source: Bloomberg Page 1 of 5 www.taonline.com.my
18. TA Securities 21-Jul-17 A Member of the TA Group Outlook Despite being ahead , no changes were made to guidance. Service revenue, absolute EBITDA and base capex are guided at similar levels to 2016. Defending its market share, priorities will be centred on core customer propositions, customer experience and maintaining its network quality advantage. With the announcement of its private placement exercise, Net debt/EBITDA is estimated to be at a much healthier 1.5x – within its comfortable threshold of 2.0x. We believe the group is now in a better financial position to brace the impact of further spectrum reviews, easing concerns over potential dividend cuts. However, we see risks in a reduction of network quality gaps. This is following a more equitable spectrum footprint, with Digi and U Mobile being allocated a higher portion of lower band 900MHz spectrum. Similarly, Celcom has made improving its network quality a priority to regain market share. Still trailing its competitors, Celcom expects its 4G population coverage to be on par with its peers by year end. Coupled with competitive pressures in the industry, this may lead to potential difficulties for Maxis to maintain its price premium. Valuation We value Maxis at a higher TP of RM5.85/share – based on a DCF valuation with WACC at 7.0% and long term growth rate of 1.0%. The stock has declined 16.2% from its one year high, following the announcement of its private placement exercise and termination of its network sharing and alliance agreement with U Mobile (of which we have accounted for in our model). As such the stock is now trading 1SD below its historical average EV/EBITDA. With valuations now more palatable, coupled with its resilient results and easing concerns over potential dividend cuts, we upgrade our recommendation on the stock to HOLD. Key risks remains the ability of the group to sustain its premium pricing. Table 1: Earnings Summary (RMmn) FYE Dec Revenue EBITDA EBITDA margin (%) Depreciation and amortisation EBIT Net finance costs Others Profit before tax Taxation MI Profit after tax Core net profit EPS (sen) EPS growth (%) PER (x) EV/EBITDA (x) DPS (sen) Dividend yield (%) FY15 8,601 4,331 50.4 (1,431) 2,899 (412) (27) 2,461 (713) (8) 1,739 1,952 25.0 0.9 22.1 12.3 19.2 3.5 FY16 8,612 4,551 52.8 (1,431) 3,120 (415) 32 2,737 (724) 1 2,013 1,963 25.1 0.6 22.0 11.7 19.2 3.5 Page 2 of 5 FY17F 8,641 4,476 51.8 (1,389) 3,087 (379) 0 2,708 (785) (9) 1,914 1,914 24.5 (2.5) 22.6 11.9 20.0 3.6 FY18F 8,709 4,464 51.3 (1,435) 3,029 (298) 0 2,731 (792) (9) 1,930 1,930 24.7 0.8 22.4 11.9 20.0 3.6 FY19F 8,710 4,394 50.4 (1,449) 2,945 (278) 0 2,667 (773) (9) 1,885 1,885 24.1 (2.3) 22.9 12.1 20.0 3.6
19. TA Securities 21-Jul-17 A Member of the TA Group Table 2 : 1HFY17 Results Analysis (RMmn) FYE Dec Revenue Service Postpaid Prepaid EntFixed IntSer (Home) Non-service Device Hubbing Network income EBITDA Depreciation and amortisation EBIT Net finance costs EI Profit before tax Taxation MI Net profit Core net profit Capex EPS (sen) DPS (sen) Profitability ratios (%) EBITDA margin EBIT margin PBT margin Net profit margin Tax rate Normalised EBITDA Total expenses (normalised) Traffic, commissions & other direct costs Spectrum license fees Network Staff and resource Marketing Operation and maintenance Others Allowance for doubtful debts, net Government grants & other income, net Operational metrics Mobile subscriptions ('000) Postpaid Prepaid Wireless broadband ARPU (RM/month) Postpaid Prepaid 2QFY16 2,102 2,055 978 956 67 54 47 12 0 35 1,050 (344) 706 (102) 44 648 (165) 5 488 424 333 1QFY17 2,157 2,129 989 1,005 72 63 28 7 1 20 1,111 (337) 774 (95) (2) 677 (172) 0 505 514 162 2QFY17 2,172 2,122 998 984 76 64 50 24 5 21 1,223 (336) 887 (107) 0 780 (206) 0 574 484 211 QoQ (%) 0.7 (0.3) 0.9 (2.1) 5.6 1.6 78.6 242.9 400.0 5.0 10.1 (0.3) 14.6 12.6 (100.0) 15.2 19.8 n/a 13.7 (5.8) 30.2 YoY (%) 3.3 3.3 2.0 2.9 13.4 18.5 6.4 100.0 n/a (40.0) 16.5 (2.3) 25.6 4.9 (100.0) 20.4 24.8 n/a 17.6 14.2 (36.6) 1HFY16 4,242 4,177 1,975 1,964 134 104 65 24 2 39 2,263 (699) 1,564 (208) 26 1,382 (379) 3 1,006 911 492 1HFY17 4,329 4,251 1,987 1,989 148 127 78 31 6 41 2,334 (673) 1,661 (202) (2) 1,457 (378) 0 1,079 998 373 YoY (%) 2.1 1.8 0.6 1.3 10.4 22.1 20.0 29.2 200.0 5.1 3.1 (3.7) 6.2 (2.9) (107.7) 5.4 (0.3) n/a 7.3 9.5 (24.2) 6.5 5.0 6.7 5.0 7.6 5.0 13.4 0.0 16.9 0.0 13.4 10.0 14.3 10.0 6.7 0.0 50.0 33.6 30.8 20.2 25.5 51.5 35.9 31.4 23.8 25.4 56.3 40.8 35.9 22.3 26.4 pp 4.8 5.0 4.5 (1.5) 1.0 pp 6.4 7.3 5.1 2.1 0.9 53.3 36.9 32.6 21.5 27.4 53.9 38.4 33.7 23.1 25.9 pp 0.6 1.5 1.1 1.6 (1.5) 1,010 1,092 534 36 209 135 63 113 2 24 (22) 1,123 1,034 521 41 203 143 39 97 (10) 16 (26) 1,104 1,068 541 42 195 137 43 119 (9) 18 (27) (1.7) 3.3 3.8 2.4 (3.9) (4.2) 10.3 22.7 (10.0) 12.5 3.8 9.3 (2.2) 1.3 16.7 (6.7) 1.5 (31.7) 5.3 (550.0) (25.0) 22.7 2,171 2,071 1,057 70 391 259 98 196 0 44 (44) 2,227 2,102 1,062 83 398 280 82 216 (19) 34 (53) 2.6 1.5 0.5 18.6 1.8 8.1 (16.3) 10.2 n/a (22.7) 20.5 12,249 2,700 9,273 276 11,808 2,800 8,820 188 11,661 2,842 8,653 166 Net adds (147) 42 (167) (22) Net adds (588) 142 (620) (110) 49 101 34 52 101 37 52 101 37 0.0 0.0 0.0 6.1 0.0 8.8 Page 3 of 5
20. TA Securities 21-Jul-17 A Member of the TA Group Figure 1 : Forward PE Figure 2 : Forward EV/EBITDA x x 28.0 14.5 +1sd: 13.7x 14.0 +1sd: 26.5x 27.0 13.5 26.0 Mean: 25.0x Mean: 13.0x 13.0 25.0 12.5 24.0 -1sd: 23.5x 12.0 23.0 -1sd: 12.2x 11.5 22.0 Source: Bloomberg, TA Securities Source: Bloomberg, TA Securities Figure 3 : Service Revenue Figure 4 : Mobile Revenue 2,100 45 63 47 61 EntFixed IntSer (Home) 2,122 2,000 2,113 2,055 50 67 54 67 2,129 2,122 63 64 72 76 78 74 2,046 2,047 2,005 1,700 1,934 1,500 1,982 2,028 Jul-17 Jan-17 Apr-17 Jul-16 Oct-16 Jan-16 Apr-16 Jul-15 Oct-15 Jan-15 2,046 2,047 2,005 1,934 1,982 2,028 1,994 1,982 1,070 1,035 1,008 956 1,017 1,018 1,005 984 976 1,012 997 978 965 1,010 989 998 2,000 1,900 1,800 Prepaid 2,500 59 57 Postpaid RMmn 2,165 1QFY16 2,155 4QFY15 2,154 3QFY15 Mobile RMmn 2,200 Apr-15 Jul-14 Oct-14 Jan-14 Apr-14 Jul-13 Oct-13 Jan-13 Apr-13 Jul-12 Jul-17 Jan-17 Apr-17 Jul-16 Oct-16 Jan-16 Apr-16 Jul-15 Oct-15 Jan-15 Apr-15 Jul-14 Oct-14 Jan-14 Apr-14 Jul-13 Oct-13 Jan-13 Apr-13 Jul-12 10.0 Oct-12 10.5 20.0 Oct-12 11.0 21.0 1,000 1,994 1,982 500 1,600 Source: Company, TA Securities Figure 5 : Postpaid Figure 6 : Prepaid Subscribers '000 4,000 97 102 101 101 ARPU 100 104 RM 101 100 3,500 3,000 2,817 2,802 2,729 2,700 2,718 2,758 2,800 '000 101 2,842 14,000 Subscribers 35 35 34 2QFY17 1QFY17 4QFY16 37 37 37 35 9,927 9,567 30 9,279 9,273 9,085 8,960 8,820 8,653 40 6,000 15 4,000 10 2,000 5 0 0 20 Source: Company, TA Securities Source: Company, TA Securities Page 4 of 5 2QFY17 1QFY17 4QFY16 3QFY16 2QFY16 1QFY16 3QFY15 2QFY17 1QFY17 4QFY16 3QFY16 2QFY16 1QFY16 4QFY15 0 4QFY15 20 500 3QFY15 25 8,000 1,000 0 40 60 2,000 1,500 35 RM ARPU 36 12,000 80 10,000 2,500 3QFY16 2QFY17 1QFY17 4QFY16 3QFY16 2QFY16 1QFY16 4QFY15 3QFY15 Source: Company, TA Securities 2QFY16 0 1,500