Bursa Malaysia Daily Market Report - 31 July

Transcription

1. Monday , 31 July, 2017 For Internal Circulation Only TA RESEARCH’S ‘DAILY COMPILED REPORTS’ News 1. 2. 3. Daily Market Commentary Weekly Strategy Weekly Technical Outlook Fundamental Reports 1. 2. Indofood Agri Resources Ltd: Sugar Sweetens Profits United Overseas Bank Limited: Better 1H17 Driven by Higher Operating Income Technical Reports 1. Weekly Technical Stock Picks 2. Daily Money Flow Technical Stock Picks FBMKLCI Stocks Under Coverage PLANTATION Sector CONSTRUCTION Sector PROPERTY Sector 3. Weekly Ace Market Stock Watch 4. Weekly Small Cap Stock Watch 5. Weekly Stock Screen Foreign Technical Reports 1. Foreign Stock Watch (AUS) 2. Foreign Stock Watch (HK) 3. Foreign Stock Watch (FSSTI) 4. Foreign Stock Watch (US) 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 (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 Monday, 31 July 2017 TA Research e-mail : taresearch@ta.com.my For Internal Circulation Only Review & Outlook KLSE Market Statistics (28.07.2017) Volume (mil) +/-chg (RMmn) Main Market 1,075.2 65.1 2,080.4 Warrants 96.7 -25.6 11.7 ACE Market 462.9 13.4 109.7 Bond 9.0 5.4 1.5 ETF 0.1 0.11 0.2 Total 1,643.9 2,203.5 Off Market 98.0 58.1 161.6 Value +/-chg 237.0 -1.3 -5.2 0.8 0.11 24.8 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 Value/ Volume 1.93 0.12 0.24 0.16 1.11 1.34 1.65 Up Down 257 350 46 78 31 59 1 5 3 0 338 492 % chg % YTD chg 1,767.08 12,591.63 17,338.61 1,768.50 -2.99 -13.53 19.04 -2.50 -0.17 -0.11 0.11 -0.14 7.64 9.81 17.83 8.13 21,830.31 6,374.68 7,368.37 19,959.84 2,400.99 26,979.39 3,330.75 1,581.06 5,831.03 3,253.24 1,868.37 5,702.82 33.76 -7.51 -74.64 -119.80 -42.25 -151.78 -23.96 0.00 11.28 3.46 2.41 -82.19 0.15 -0.12 -1.00 -0.60 -1.73 -0.56 -0.71 0.00 0.19 0.11 0.13 -1.42 10.46 18.42 3.16 4.42 18.48 22.63 15.62 2.47 10.09 4.82 -5.12 0.65 Given the weak buying momentum, market breadth, cautious undertone and mixed or conflicting readings on trend and momentum indicators, more consolidative action or range bound trading can be expected this week. The market should continue to lag behind foreign peers led by the US counterpart surging to record highs, as the absence of any significant positive local catalysts to lift stocks from the present sideways consolidation to restrict trading participation. On the index, immediate support from the 100-day moving average level now at 1,759 must hold to prevent further correction to 1,729, a key support level in April, while crucial uptrend support is from the 200-day moving average at 1,710. Immediate resistance stays at the 50-day moving average now at 1,770, next 1,782, followed by the recent peak of 1,796. Sector-wise, lower liners and small caps are likely to stay in profit-taking consolidation given the weak trading momentum, but blue-chip banking and utility counters such as Alliance Financial Group, AMBank, RHBBank, Axiata, Gamuda, Tenaga and TM should attract bargain hunters on any further price dips. News Bites • • • • • • • Top 10 KLCI Movers Based on Mkt Cap. Off Market (mn) PTRANS 31.0 SCBUILD 30.0 BIMB 14.8 THRIVEN 6.0 TENAGA 5.0 THRIVEN-WB 2.9 GDEX 2.5 MEXTER 2.0 ROHAS 2.0 (RM) @ 0.18 @ 0.03 @ 4.40 @ 0.25 @ 14.20 @ 0.06 @ 0.66 @ 0.28 @ 1.13 Counter Mkt Cap. (RM’mn) TENAGA 80,132 SIME 64,608 CIMB 55,600 MAXIS 41,661 GENTING 36,531 GENM 33,954 MISC 32,854 HLBANK 28,089 HAPSENG 22,432 RHBBANK 20,171 Chg Vol. (RM) (mn) -0.08 9.19 -0.04 11.73 -0.01 4.32 -0.06 3.74 -0.08 2.78 -0.12 4.28 -0.02 0.39 -0.01 2.67 -0.14 0.16 -0.06 0.35 Important Dates CAB - 1:4 Bonus Issue - BI of 138.6m subdivided shares. 1 bonus share for every 4 subdivided shares. Ex-Date: 02/08/2017. Entitlement Date: 04/08/2017. LISTING ON: 07/08/2017. • • • • Sime Darby Bhd announced a slew of top level management changes. Pos Malaysia Bhd has partnered Singapore-based e-commerce logistics and selling platform Anchanto to strengthen its e-commerce warehousing facilities. XOX Bhd is partnering an Indonesian telecommunication services company to take its Voopee mobile solution to Indonesia. Tropicana Corp Bhd expects its Tropicana Urban Homes, a new collection of affordable condominiums, to contribute RM2bn sales in the next two years. Berjaya Assets Bhd has acquired an additional 1.32% equity interest in 7-Eleven Malaysia Holdings Bhd for RM18mn. Fajarbaru Builder Group Bhd has secured a RM101.3mn contract to complete the remaining building works of a commercial development for TYL Land & Development Sdn Bhd. CB Industrial Product Holding Bhd's 80%-owned unit has acquired a parcel of freehold land in Damansara together with a factory unit erected thereon for RM8mn from Beebull Engineering Sdn Bhd. Focus Dynamics Group Bhd is revising its previous proposed renounceable rights issue involving some 1.25bn new shares with up to 622.69mn free detachable warrants to include the issuance of irredeemable convertible preference shares. Orion IXL Bhd has been informed by its target acquisition ASAP Bhd that a suit has been filed against ASAP by Sporty Beans Sdn Bhd. Parkson Holdings Bhd's 54.67%-owned Hong Kong unit Parkson Retail Group Ltd has won a bid to unfreeze the bank deposits of two subsidiaries that are embroiled in a lawsuit in China. With the US 2Q17 GDP expanding at an annual rate of 2.6%, the nation has entered the ninth year of economic expansion in steady but unspectacular fashion that shows little sign of abating. Exchange Rate USD/MYR 4.2821 0.0043 USD/JPY 111.23 -0.1200 EUR/USD 1.171 0.0002 Commodities Futures Palm Oil (RM/mt) 2,653.00 -22.00 Crude Oil ($/Barrel) 49.79 0.64 Gold ($/tr.oz.) 1,269.00 10.30 ORION - 7:2 Rights Issue - RI of up to 465.9m shares together with up to 232.9m free detachable warrants. 7 rights shares together every 2 existing shares held, at an issue price of RM0.17 per rights share, with 1 free warrant for every 2 rights shares subscribed. LISTING ON: 02/08/2017. 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 Monday , July 31, 2017 FBMKLCI: 1,767.08 A Member of the TA Group MENARA TA ONE, 22 JALAN P. RAMLEE, 50250 KUALA LUMPUR, MALAYSIA TEL: +603-20721277 / FAX: +603-20325048 Weekly Strategy Market View, News In Brief: Corporate, Economy, and Share Buybacks THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Kaladher Govindan Market View Tel: +603-2167 9609 kaladher@ta.com.my www.taonline.com.my FBMKLCI Could Remain Range-bound The benchmark FTSE Bursa Malaysia Kuala Lumpur Composite Index (FMB KLCI) rose on the back of an oversold rebound last week, with Petronas heavyweights shoring up the index, but lower liners and small caps remained largely in profit-taking consolidation. The dovish tone from the US Federal Reserve’s monetary policy statement improved sentiment mid-week, but profit-taking interest increased ahead of the weekend, clouded by concerns over the US Federal Reserve’s eventual move to trim its balance sheet. Week-on-week, the FBM KLCI added 7.92 points, or 0.54 percent to 1,767.08, with gains on CIMB (+29sen), Public Bank (+18sen), Petronas Dagangan (+14sen) and Petronas Gas (+14sen) offsetting falls on Hap Seng Consolidated (-10sen), Axiata (-9sen) and AMBank (8sen). Average daily traded volume and value deteriorated to 1.57 billion shares and RM1.8 billion, compared with the 1.99 billion shares and RM2 billion average respectively the previous week, as more investors moved to the sidelines given the cautious market undertone. The FBMKLCI could remain in a range-bound trade this week in the absence of fresh catalysts to propel it higher. The Nikkei Malaysia Purchasing Managers’ Index (PMI) for July that will be released tomorrow could provide a glimpse of what to expect of future trade after the release of Malaysia’s June trade numbers this Friday. The PMI rose to a high of 50.7 last April, above the 50-point threshold that indicates economic expansion, for the first time since March 2015 but eased to 48.7 in May. The follow through positive impact was felt in Malaysia’s trade for May when exports grew at a staggering rate of 32.5% YoY to RM79.4 billion (bn), surpassing imports growth (30.4% YoY) for the first time since May 2016. It was mainly driven by exports of manufactured goods that rose by 32.7% YoY to RM66.6bn. However, the PMI has been on a downtrend since May as it drifted lower to 46.9 in June as output and new orders declined. The impact could be felt in June trade numbers this Friday. As long as the exports and imports growths fall within the consensus expectations of 17.6% and 18.8% YoY respectively, we may not see any deterioration in market sentiment. If the July PMI number shows a rebound from June, which was the worst reading since data collection started five years ago, any weakness in June trade data may not have a lasting impact on the market. Besides, China is also due to announce its official manufacturing and non-manufacturing PMI data for July today. The Caixin China Manufacturing number is due tomorrow while its Composite and Services data will be due on Thursday. A stronger set of numbers should be able to sustain consensus view that Malaysia’s exports will remain resilient in the second half of 2017 as China is Malaysia’s largest trading partner. Malaysia’s exports to China surged by 51.5% YoY to RM10.7bn in May and the world’s second largest economy made up of 16.1% of Malaysia’s total trade of RM722.9bn in January-May 2017. Page 1 of 7
4. TA Securities 31-Jul-17 A Member of the TA Group July PMI data for the US will be released this week as well . However, investors could be more interested in tracking the changes in July non-farm payrolls and wages this Friday due to their direct correlation with the US Federal Reserves’ monetary policy decisions. Perhaps, a weaker-than-expected data could allay concerns about a QE tapering as early as this September after the US 2Q17 GDP that expanded at an annual rate of 2.6% strengthened the case of continued monetary tightening. Consensus forecast points to an increase of 183,000 and 2.4%YoY compared to 222,000 and 2.5% in non-farm payrolls and hourly earnings respectively from a month ago. Page 2 of 7
5. TA Securities 31-Jul-17 A Member of the TA Group News In Brief Corporate Sime Darby Bhd announced a slew of management changes . Its chairman Tan Sri Abdul Ghani Othman will assume the same post in Sime Darby Plantation Bhd (SDPL), while its group chief executive officer (CEO) and president Tan Sri Mohd Bakke Salleh will become SDPL’s executive deputy chairman and managing director (MD). Datuk Franki Anthony Dass, the current head of SDPL, will be taking on a new role as the company's chief adviser and value officer, while Renaka Ramachandran will be its chief financial officer (CFO). Tan Sri Abdul Wahid Omar (PNB Chairman) has been named as chairman of Sime Darby Property Bhd (SDPR) whilst Datuk Seri Amrin Awaluddin (former Media Prima Bhd MD) has been appointed as SDPR’s MD. Sime Darby's current group CFO Datuk Tong Poh Keow will be redesignated as SDPR’s CFO. Meanwhile, Sime Darby's deputy chairman Tan Sri Dr Wan Abdul Aziz Wan Abdullah has been promoted to become chairman of Sime Darby Bhd, while Jeffri Salim Davidson will become its president and group chief executive. (Bursa Malaysia/The Edge) Pos Malaysia Bhd has partnered Singapore-based e-commerce logistics and selling platform Anchanto to strengthen its e-commerce warehousing facilities. Under the partnership, Pos Malaysia will use Anchanto's warehouse management technology to expand its ability in providing a comprehensive e-fulfilment service. (The Edge) XOX Bhd is partnering an Indonesian telecommunication services company to take its Voopee mobile solution to Indonesia. It entered into a memorandum of understanding (MoU) with PT Inovasi Telematika Nusantara and Pengurus Besar Nahdlatul Ulama (PBNU) to conduct a study, with plans to deploy the Voopee solution under the Nahdlatul Ulama branding to be adopted by PBNU members. The MoU will remain in force for six months or until a commercial agreement is entered between the parties. (The Edge) Tropicana Corp Bhd has unveiled a new collection of homes dubbed Tropicana Urban Homes to offer more affordable houses to middle-income homebuyers. It expects Tropicana Urban Homes, a new collection of affordable condominiums, to contribute RM2bn sales in the next two years. (The Edge) Berjaya Assets Bhd has acquired an additional 1.32% equity interest in 7-Eleven Malaysia Holdings Bhd for RM18mn. It acquired 14.6mn shares, at an average price of RM1.23 per share in the open market between June 8 and July 26. Following the acquisition, Berjaya Assets' stake in 7-Eleven amounts to 3.95%. (Bursa Malaysia) Fajarbaru Builder Group Bhd has secured a RM101.3mn contract to complete the remaining building works of a commercial development for TYL Land & Development Sdn Bhd. It also accepted a letter of award from Malaysia Aiports (Sepang) Sdn Bhd in respect of the proposed apron line marking, access road connection and associated works at KLIA Air Cargo Terminal 1. The contract, which is valued at RM705K, will last for 120 days, commencing Aug 1. (Bursa Malaysia) CB Industrial Product Holding Bhd's (CBIPH) 80%-owned unit, Avecpalm Marketing Resources Sdn Bhd (AMR), has acquired a parcel of freehold land in Damansara together with a factory unit erected thereon for RM8mn from Beebull Engineering Sdn Bhd. The acquisition will enable AMR and CBIPH to expand its existing business activities as well as to take up more business opportunities. (Bursa Malaysia) Focus Dynamics Group Bhd is revising its previous proposed renounceable rights issue involving some 1.25bn new shares with up to 622.69mn free detachable warrants to include the issuance of irredeemable convertible preference shares as it will not have an immediate dilution effect on the groups' earnings per share. (Bursa Malaysia) Page 3 of 7
6. TA Securities 31-Jul-17 A Member of the TA Group Orion IXL Bhd has been informed by its target acquisition ASAP Bhd that a suit has been filed against ASAP by Sporty Beans Sdn Bhd . Sporty Beans is claiming that ASAP had entered into a joint venture agreement with the former to design, develop, deploy and launch an e-portal for it, and ASAP had breached the agreement. (Bursa Malaysia) Parkson Holdings Bhd’s 54.67%-owned Hong Kong unit Parkson Retail Group Ltd has won a bid to unfreeze the bank deposits of two subsidiaries that are embroiled in a lawsuit in China. The court had dismissed the application of China Construction Bank Corp (Changshou branch) to freeze the subsidiaries' deposits, together with Changshou Hang Lung Properties Co Ltd and three others that totalled RMB212.41mn (about RM134.87mn). (The Edge) Kronologi Asia Bhd saw the net profit for 2QFY17 more than double to RM4.1mn from RM1.7mn a year ago. Profit after tax expanded by 96.7% to RM6.1mn for 1HFY17, compared to RM3.1mn in 1HFY17. The higher profit achieved was attributable to a 154.27% increase in revenue. Growth continues to be powered by strong activity in the enterprise data management infrastructure business, although the product mix during the quarter included lower margin products. (Bursa Malaysia) EcoFirst Consolidated Bhd's net profit for 4QFY17 jumped by about 13 times to RM7.77mn from RM608K a year ago, mainly due to contribution from the development of Upper East at Tiger Lane in Ipoh, Perak, and Liberty project at Ampang Ukay. For FY17, net profit slipped by 3.6% to RM15.6mn from RM16.2mn in FY16. (Bursa Malaysia) Page 4 of 7
7. TA Securities 31-Jul-17 A Member of the TA Group News In Brief Economy Asia China 's Urban Unemployment Rate Stays Below 4% for Second Straight Quarter China's registered urban unemployment rate stayed below 4% for the second consecutive quarter as the world's No. 2 economy maintained a robust growth trajectory in 2017's first half. China's urban registered unemployment rate was 3.95% at end-June, compared with 3.97% at end-March and 4.05% a year earlier, the Ministry of Human Resources and Social Security said. On an annual basis, the official unemployment rate was last below 4% in 2001, when it was 3.6%. The rate ended last year at 4.02% after not budging from 4.1% from 2010 through 2015. The registered urban jobless rate excludes China's 280 million migrant workers. (Reuters) Singapore's Resident Jobless Rate and Retrenchments Improved from Q1 The jobless rate and retrenchments of Singapore residents in the Q2 2017 are lower than in the Q1 2017, preliminary by the Ministry of Manpower (MOM) showed. However, total employment continued to decline, largely reflecting a decrease in work permit holders in construction and marine. QoQ, the unemployment rate of citizens fell to a seasonallyadjusted 3.3% in June from 3.5% in March, while the jobless rate of residents was a seasonally-adjusted 3.1% in June, down from 3.2% in March. Fewer workers were retrenched in the second quarter of 2017 (3,500) compared to the previous quarter (4,000). The number was also significantly lower than a year ago (4,800). The decrease over the quarter was broad-based across industries. Separately, the HDB Resale Price Index (RPI) fell by 0.1% to 133.7 in the Q2, from 133.9 in the Q1. A year ago, the index stood at 134.7, the Housing & Development Board (HDB) said. Resale transactions rose by 32.5% to 6,001 cases, compared to 4,530 cases in the preceding quarter. (The Business Times) Australia Final Demand Producer Prices Rise 0.5% Final demand producer prices in Australia were up 0.5% on quarter in the Q2 2017, the Australian Bureau of Statistics said - unchanged from the previous three months. On a yearly basis, producer prices jumped 1.7% - accelerating from 1.3% in the three months prior. Domestic prices were up 0.6% on quarter and 2.2% on year, while import prices added 0.2% on quarter but fell 1.7% on year. The gains were mainly due to rises in the prices received for heavy and civil engineering construction (+0.9%), building construction (+0.8%) and other agriculture (+7.4%). They were partly offset by falls in the prices received for petroleum refining and petroleum fuel manufacturing (-4.8%), accommodation (-2.4%) and commercial fishing (-7.6%). (RTT News) Japan Household Spending Jumps 2.3% in June The average of household spending in Japan was up 2.3% on year in June, the Ministry of Internal Affairs and Communications said. That was well above expectations for an increase of 0.5% following the 0.1% decline in May. The average of monthly income per household stood at 735,477 yen, 0.1% on year. The average of consumption expenditures per household was 296,653 yen, up an annual 6.7%. Other news in Japan: • Overall nationwide consumer prices in Japan gained 0.4% on year in June. Nationwide core CPI, which excludes food prices, also gained 0.4% on year - again unchanged and as expected. Individually, prices for fuel jumped 3.5% on year, followed by food (0.8%) and education (0.4%). Furniture prices slid 0.8%. On a monthly basis, overall CPI and core CPI were both unchanged. • The unemployment rate in Japan came in at a seasonally adjusted 2.8% in June. The participation rate came in at 61.0, up from 60.8 a month earlier. Page 5 of 7
8. TA Securities 31-Jul-17 A Member of the TA Group United States • Japan’s key price gauge was unchanged in June, helped by rising power costs. The tight labour market may also start to help inflation, which remains far from the central bank’s 2% target. • Retail sales in Japan were up a seasonally adjusted 0.2% on month in June. On a yearly basis, retail sales climbed 2.1% - unchanged from the previous month but missing forecasts for 2.4%. (RTT News/Bloomberg) U.S. Economy Glides Back to Steady, Modest Growth Path The U.S. entered the ninth year of economic expansion in steady but unspectacular fashion that shows little sign of abating. Gross domestic product, a broad measure of goods and services produced in the U.S., expanded at a 2.6% annual rate in the second quarter, the Commerce Department said, a rebound after a tepid start to the year. The figures repeated a familiar pattern of weak winters followed by a stronger spring and summer, leaving overall growth subdued. The U.S. emerged from recession in mid-2009. Since then, GDP growth has averaged 2.1%. In contrast, growth averaged 3.6% during a 10-year span in the 1990s and 4.9% during a nearly nine-year stretch in the 1960s, the only two expansions with longer durations. Slow and steady has produced a long stretch of job creation and left the economy on mostly stable footing, with few signs of the kind of excess that in the past have derailed long periods of growth. In the 1960s, for example, runaway inflation led the Federal Reserve to raise interest rates and curtail growth. Today, broad measures of inflation are historically weak. The price index for personal-consumption expenditures—the Fed’s preferred inflation gauge—rose at an annual rate of 0.3% in the second quarter. That is well below the Fed’s 2% target. Core prices, which exclude volatile food and energy costs, increased 0.9% at an annual rate during the quarter. (The Wall Street Journal) U.S. Employment Costs Decelerated in Second Quarter A broad gauge of U.S. wages and benefits advanced only modestly this spring, the latest sign of little pressure on labour costs despite what appears to be a tight labour market. The employment-cost index for civilian workers increased a seasonally adjusted 0.5% in the second quarter, the Labor Department said. Economists surveyed by The Wall Street Journal had forecast a 0.6% gain. Wages and salaries, which account for 70% of total compensation, rose 0.5% from the prior quarter. Benefits, which includes health coverage, retirement savings and paid leave, advanced 0.6%. From a year earlier, total compensation rose 2.4%, maintaining a trend in place since early last year. Wages increased 2.3% from a year earlier. The unemployment rate, 4.4% last month, is near the lowest level in a decade. Wages are generally expected to rise when the supply of available labour is low. But compensation growth has shown little signs of accelerating. The wage component of the index is calculated differently than the average hourly earnings measure published monthly in the jobs report, but they show a similar pattern. Average hourly earnings for privatesector workers advanced 2.5% in June from a year earlier. Average wages have grown near that pace for the past year and a half. Both measures are advancing more slowly than their average pace in the several years before the most recent recession began in late 2007. (The Wall Street Journal) U.S. Consumer Sentiment Fell in July American consumers’ confidence in the current state of the economy is at a 12-year high, but their optimism about the future is deteriorating. The University of Michigan on Friday said its final reading on overall consumer sentiment during July was 93.4, up from a preliminary reading of 93.1 but down from 95.1 in June. Economists surveyed by The Wall Street Journal had expected a final July figure of 93.1. An index that tracks expectations about the future declined to 80.5, its lowest level since last October. But an index tracking confidence in the current economic situation jumped to 113.4, its highest level since July 2005 and the second-highest reading since November 2000. The overall index was up 3.8% in July from a year earlier. (The Wall Street Journal) Page 6 of 7
9. TA Securities 31-Jul-17 A Member of the TA Group Europe and United Kingdom UK Consumer Confidence Drops Back to Post-Brexit Vote Low Sentiment among UK households dropped this month to match the weakest reading since just after the Brexit vote , led by a sharp drop in confidence in the economy. The reading of minus 12 in GfK's consumer-confidence index is down two points from the previous month. Excluding the post-referendum dip in July 2016, the index hasn't been this low since 2013. A gauge of how consumers see the economy progressing fell 5 points to minus 28, while their eagerness to make major purchases also waned. With inflation outpacing wage growth, real incomes are falling as uncertainty over how the UK will leave the European Union further undermines sentiment. The Office for National Statistics said this week that the economy experienced a "notable slowdown" in the 1H2017. (The Edge Market) Eurozone Economic Sentiment Near Decade High Eurozone economic confidence strengthened unexpectedly in July to near a decade-high, survey data from the European Commission showed. The economic sentiment index rose slightly to 111.2 in July from 111.1 in June. The score was forecast to fall to 110.8. This was the highest score since the 2007 financial crisis. The ESI supports the assessment that the euro-zone economy will expand by an above-consensus 2.2 percent this year, Jack Allen, an economist at Capital Economics, said. But with core inflation still subdued, the European Central Bank is likely to proceed with caution, he added. The International Monetary Fund upgraded the Eurozone growth outlook earlier this week, citing stronger momentum in domestic demand than previously anticipated. (RTT News) Share Buy-Back: 28 July 2017 Company DAIBOCI UNIMECH Bought Back Price (RM) Hi/Lo (RM) 21,000 25,000 2.25/2.18 1.04 2.29/2.18 1.06/1.04 Total Treasury Shares 122,500 5,311,110 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 7 of 7 We accept no We, our associates, directors, employees may have an interest in
10. T e c h n i c a l TA Securities V i e w Monday , July 31, 2017 A Member of the TA Group MENARA TA ONE, 22 JALAN P. RAMLEE, 50250 KUALA LUMPUR, MALAYSIA TEL: +603-20721277 / FAX: +603-20325048 Weekly Technical Outlook FBM KLCI: 1,767.08 (+7.92, +0.45%) THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Chartist : Stephen Soo Tel: +603-2167 9607 stsoo@ta.com.my www.taonline.com.my Range Bound on Mixed Momentum Indicators The benchmark FTSE Bursa Malaysia Kuala Lumpur Composite Index (FMB KLCI) rose on the back of an oversold rebound last week, with Petronas heavyweights shoring up the index, but lower liners and small caps remained largely in profit-taking consolidation. The dovish tone from the US Federal Reserve’s monetary policy statement improved sentiment mid-week, but profit-taking interest increased ahead of the weekend, clouded by concerns over the US Federal Reserve’s eventual move to trim its balance sheet. Week-on-week, the FBM KLCI added 7.92 points, or 0.54 percent to 1,767.08, with gains on CIMB (+29sen), Public Bank (+18sen), Petronas Dagangan (+14sen) and Petronas Gas (+14sen) offsetting falls on Hap Seng Consolidated (-10sen), Axiata (-9sen) and AMBank (8sen). Average daily traded volume and value deteriorated to 1.57 billion shares and RM1.8 billion, compared with the 1.99 billion shares and RM2 billion average respectively the previous week, as more investors moved to the sidelines given the cautious market undertone. Bursa Malaysia shares ended a cautious Monday session mixed, with the lack of key domestic leads dampening trading participation. The KLCI rose 2.83 points to close at the day’s high of 1,761.99, off an early low of 1,757.22, as losers beat gainers 516 to 314 on cautious trade totaling 1.67bn shares worth RM1.68bn. Blue chips rose slightly the following day, with gaming counters and Petronas heavyweights shoring up the benchmark, but lower liners and small caps remained in profit-taking consolidation. The KLCI added 1.35 points to end at 1,763.34, off an opening high of 1,766.47 and low of 1,761.16, as losers beat gainers 510 to 329 on slow trade totaling 1.68bn shares worth RM1.62bn. The local benchmark ended higher Wednesday despite profit-taking interest and weak buying momentum, lifted by oil & gas related heavyweights following firmer global oil prices. The KLCI increased 2.66 points to close at 1,766, off the early high of 1,766.70 and low of 1,760.82 as losers edged gainers 431 to 375 on reduced turnover totaling 1.30bn worth RM1.55bn. Blue chips rose further the next day, encouraged by firmer regional peers as stronger earnings and the dovish tone from the US Federal Reserve’s monetary policy statement improved sentiment. The KLCI closed up 4.07 points at 1,770.07, off an early low of 1,765.84 and high of 1,772.03, as gainers edged losers 425 to 410 on cautious trade totaling 1.58bn shares worth RM1.97bn. Stocks eased off early highs Friday as profit-taking interest increased ahead of the weekend, with caution over the US Federal Reserve’s eventual move to trim its balance sheet discouraging trading commitments. The index ended 2.99 points down at the day’s low of 1,767.08, off an early high of 1,772.30, as losers beat gainers 492 to 338 on moderate turnover of 1.64bn shares worth RM2.2bn. Trading range for the blue-chip benchmark index last week improved to 15.07 points, compared to the tight 8.42-point range the previous week, as core Petronas heavyweights rose on a rebound in global oil prices. For the week, the FBM-EMAS Index rose 51.62 points or 0.41 percent to 12,591.63, while the FBM-Small Cap Index added 16 points, or 0.1 percent to 17,338.61, as small cap stocks recovered on mild accumulation interest. Page 1 of 3
11. TA Securities 31-Jul-17 A Member of the TA Group The daily slow stochastics indicator for the FBM KLCI is now slightly overbought following last week ’s mild recovery, while the weekly indicator’s signal line hooked up just above the oversold level. The 14-day Relative Strength Index (RSI) indicator hooked down to a neutral reading of 52.84 after last Friday’s weak close, but the 14-week RSI retained a hook-up for an improved reading of 59.54. Chart 1 On trend indicators, the daily Moving Average Convergence Divergence’s (MACD) signal line climbed higher after flashing a buy the previous week, but the bearish trend reading on the weekly MACD indicator stays intact (Chart 2). The -DI and +DI lines on the 14-day Directional Movement Index (DMI) trend indicator crossed for a buy signal, but the ADX line eased further, implying a trendless market. Chart 2 Page 2 of 3
12. TA Securities 31-Jul-17 A Member of the TA Group Conclusion Given the weak buying momentum , market breadth, cautious undertone and mixed or conflicting readings on trend and momentum indicators, more consolidative action or range bound trading can be expected this week. The market should continue to lag behind foreign peers led by the US counterpart surging to record highs, as the absence of any significant positive local catalysts to lift stocks from the present sideways consolidation to restrict trading participation. On the index, immediate support from the 100-day moving average level now at 1,759 must hold to prevent further correction to 1,729, a key support level in April, while crucial uptrend support is from the 200-day moving average at 1,710. Immediate resistance stays at the 50day moving average now at 1,770, next 1,782, followed by the recent peak of 1,796. Sector-wise, lower liners and small caps are likely to stay in profit-taking consolidation given the weak trading momentum, but blue-chip banking and utility counters such as Alliance Financial Group, AMBank, RHBBank, Axiata, Gamuda, Tenaga and TM should attract bargain hunters on any further price dips. Chart 3 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 Page 3 of 3
13. TA Securities RESULTS UPDATE Monday , July 31, 2017 FSSTI: 3,330.75 A Member of the TA Group Sector: Plantation MENARA TA ONE, 22 JALAN P. RAMLEE, 50250 KUALA LUMPUR, MALAYSIA TEL: +603-20721277 / FAX: +603-20325048 TP: SGD0.53 (+7.1%) Indofood Agri Resources Ltd Last Traded: SGD0.495 Sugar Sweetens Profits HOLD THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Angeline Chin Tel: +603-2167 9611 angelinechin@ta.com.my Review Indofood Agri Resources’ (IFAR) 1HFY17 results came in within ours but above consensus expectations. Stripping out the impact of foreign exchange, fair value loss on biological assets and other exceptional items of Rp103.1bn, the 1HFY17 core net profit of Rp372.9bn accounted for 57% and 61% of ours and consensus’ full-year estimates respectively. 1HFY17 revenue increased by 26.8% YoY to Rp8.5tn mainly attributable to recovery in palm production, higher commodity prices and improved contribution from CMAA (sugar JV in Brazil). Plantation: 1HFY17 revenue increased by 33.1% YoY, spurred by significantly high average selling prices and sales volumes of CPO and PK related products, as well as higher rubber sales. CPO production increased by 11.3% YoY to 393k tonnes, mainly due to new mature area (6.5k ha). Our calculation revealed that the average selling price of CPO and PK increased by 17.3% and 33.4% to Rp8,470/kg and Rp7,494/kg, respectively. EBITDA stood at Rp1.5tn, up 67% YoY. Edible Oils & Fats (EOF): Revenue increased 15.6% YoY to Rp4.8tn, spurred by higher sales of edible oil and stearin products. However, EBITDA decreased by 41.4% to Rp147bn attributable to higher raw material costs (mainly CPO). The associated companies registered a profit of Rp6.7bn compared to a loss of Rp19.8bn, thanks to higher profit contribution from Roxas (the largest integrated sugar business in the Philippines) and the cessation of equity accounting of loss-making Heliae’s performance, which is now recorded as a financial asset available for sale. The 50%-owned JV, CMAA, has turnaround and reported a net profit of Rp26.9bn compared to a net loss of Rp118.3bn in 1HFY16 as the operation has turnaround in 2QFY17. No dividend was declared for the quarter under review. Impact No change to our earnings forecasts. Outlook There is no change in management guidance that FFB production for FY17 is expected to increase by 10% YoY, riding on yield recovery and higher mature acreage in Indonesia. According to management, another 8k ha of plantation land of palm oil will mature in FY17 while the replanting of 3k ha will take place in North Sumatra and Riau in FY17. Management expects commodity prices to remain volatile owing to recovery in oil palm and soybean production, and soft global economy (particularly China). Meanwhile, the management is not overly optimistic on Indonesia’s biodiesel demand to absorb the excess supply. Share Information Bloomberg Code IFAR SP Stock Code 5JS Listing SGX Mainboard Share Cap (mn) 1,417 Market Cap (SG$m) 702 52-wk Hi/Lo (SG$) 0.595/0.440 12-mth Avg Daily Vol ('000 shrs) 811 Estimated Free Float (%) 25.2 Beta 1.10 Major Shareholders (%) Indofood Singapore Holdings (71.51) Forecast Revision Forecast Revision (%) Net profit (Rp bn) Consensus (Rp bn) TA's / Consensus (%) Previous Rating FY17 FY18 653.1 698.2 615.2 735.2 106.2 95.0 Hold (Maintained) Financial Indicators Net debt/equity (%) CFPS (SG¢) P/CFPS (x) ROA (%) NTA/Share (SG$) Price/ NTA (x) FY17 67.6 (12.6) nm 1.8 0.7 0.7 FY18 60.2 8.1 6.1 1.9 0.8 0.7 % of FY 57 61 Within Above IFAR 3.1 1.0 (7.5) 7.6 FSSTI 3.2 4.9 9.3 16.1 Scorecard vs TA vs Consensus Share Performance (%) Price Change 1 mth 3 mth 6 mth 12 mth (12-Mth) Share Price relative to the FSSTI Source: Bloomberg Page 1 of 3 www.taonline.com.my
14. TA Securities 31-Jul-17 A Member of the TA Group Valuation Maintain IFAR as Hold with an unchanged TP of SGD0 .53 based on SOP valuation. Key risks to our recommendation/earnings forecasts are, 1) sharp correction in CPO price as its earnings are highly sensitive to CPO price, 2) margin compression in the downstream segment, and 3) economic slowdown hurting demand for edible oils. Figure 1: IFAR’s Sum-of-Part valuation table Valuation Effective shareholding (%) PT SIMP 73.5% CMAA 50.0% Associate 15.3% Net cash (holding co) SOP (SGDmn) Share cap (mn) SOP/share Holding co discount Target price (SGD) Figure 2: Earnings Summary YE Dec 31 (Rp bn) Revenue EBITDA EBITDA margin Pretax profit Net profit Core net profit EPS Core EPS EPS Core EPS Core EPS growth PER GDPS Div yield Core ROE EBIT Margin Pretax Margin Tax Rate FY15 13,835.4 2,803.8 20.3 328.7 (48.1) 306.5 (33.2) 211.7 (0.4) 2.3 (61.2) 21.9 0.5 1.0 2.4 (%) (Rp) (Rp) (SG¢) (SG¢) (%) (x) (SG$¢) (%) (%) Figure 3: 2QFY17 Results Analysis YE Dec 31 (Rp bn) Turnover EBIT Net interest Forex & EI Associates & JV Biological assets gain/loss Pretax Taxation MI Reported net profit Core net profit Core EPS DPS Equity Value (SGDmn) 803 60 24 (50) 838 1,417 0.59 10% 0.53 FY16F 14,530.9 3,553.9 24.5 1,689.5 506.5 294.7 349.9 203.5 3.7 2.2 (3.9) 22.8 0.7 1.3 2.5 2QFY16 3,568.5 295.794 (146.4) 8.3 (85.2) 11.5 83.9 (61.3) 7.3 29.9 10.2 1QFY17 4,400.8 741.1 (135.0) (32.5) (43.4) (47.5) 482.8 (153.8) (158.4) 170.6 250.5 2QFY17 4,117.2 237.2 (137.4) 14.6 76.9 (37.7) 153.6 (74.3) 20.0 99.3 122.4 (Rp) (SG¢) 7 0 177 0 (%) (%) (%) 8.3 2.4 73.1 16.8 11.0 31.9 Page 2 of 3 QOQ% (6.4) (68.0) (1.8) nm nm 20.6 68.2 51.7 nm (41.8) (51.1) Note Based on PER of 15x Investment cost Market Price FY17E 15,292.6 3,236.0 21.2 1,122.9 653.1 653.1 451.1 451.1 4.8 4.8 121.6 10.3 1.2 2.4 5.4 % YoY 15.4 (19.8) 6.1 76.8 nm nm 83.1 (21.3) >100 >100 >100 FY18F 16,461.1 3,495.5 21.2 1,200.5 698.2 698.2 482.3 482.3 5.1 5.1 6.9 9.6 1.3 2.6 5.5 FY19F 17,366.6 3,584.7 20.6 1,319.2 767.2 767.2 529.9 529.9 5.7 5.7 9.9 8.8 1.4 2.8 5.8 1HFY16 6,715.5 487.2 (288.3) 94.4 (138.1) 95.4 250.6 (132.2) 6.4 124.8 (65.0) 1HFY17 8,518.1 978.3 (272.5) (17.9) 33.6 (85.2) 636.3 (228.1) (138.4) 269.8 372.9 86 0 (46) 0 263 0 5.8 3.7 48.4 7.3 3.7 52.7 11.5 7.5 35.8 YOY% 26.8 >100 5.5 nm nm nm >100 (72.6) nm >100 nm
15. TA Securities 31-Jul-17 A Member of the TA Group Figure 4 : CPO and PK Sales Volume 350 '000 MT CPO PK 300 250 200 150 100 50 1Q16 2Q16 3Q16 1Q16 2Q16 3Q16 2Q17 4Q15 4Q15 1Q17 3Q15 3Q15 4Q16 2Q15 2Q15 1Q15 4Q14 3Q14 2Q14 1Q14 4Q13 3Q13 2Q13 1Q13 4Q12 3Q12 2Q12 1Q12 4Q11 3Q11 2Q11 1Q11 0 Source: Company, TA Research Figure 5: Average Selling Price of CPO and PK Rp/kg 10,000 CPO PK 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 2Q17 1Q17 4Q16 1Q15 4Q14 3Q14 2Q14 1Q14 4Q13 3Q13 2Q13 1Q13 4Q12 3Q12 2Q12 1Q12 4Q11 3Q11 2Q11 1Q11 0 Source: Company, TA Research 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. 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. 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
16. RESULTS UPDATE TA Securities Monday , July 31, 2017 STI: 3,330.75 Sector: Finance A Member of the TA Group MENARA TA ONE, 22 JALAN P. RAMLEE, 50250 KUALA LUMPUR, MALAYSIA TEL: +603-20721277 / FAX: +603-20325048 United Overseas Bank Limited TP: S$25.40 (+5.6%) Last Traded: S$24.05 Better 1H17 Driven by Higher Operating Income HOLD THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* TA Research Team Coverage Tel: +603-2167 9610 liwong@ta.com.my Review UOB reported stronger 1H17 results. Net profit grew sequentially and yearly on the back of higher operating income and higher contribution from associates. YTD net profit stood at S$1,652mn, representing 52% and 50% of ours and consensus’ full year profit estimates. ROE and ROA stood little changed at 10.2% and 0.97% from a year ago. Representing a payout ratio of 35%, an interim one-tier tax-exempt dividend of 35 cents (2Q16: 35 cents) per ordinary share has been declared. The scrip dividend scheme will be applied to the interim dividend. Non-interest income (non-NII) accelerated to S$1,647mn from S$1,507mn in 1H16. Fee income surged 13.1% YoY, underpinned by healthy contribution from wealth management, fund management and credit card fees. Other non-NII improved 3.5% YoY, led by better net trading income which rose to S$426mn from S$381mn a year ago. Net interest income (NII) broadened by 7% YoY (and 12.0% QoQ), attributed by a 7% YoY expansion in loan growth. Net interest margin (NIM) widened marginally to 1.75% from 1.73% in 1Q17 and 1.68% a year ago. Loan growth accelerated across all key countries. In descending order, loan growth was led by operations in Thailand (+19.3% YoY), followed by Greater China (+14.5% YoY) and Singapore (+4.6% YoY). The loan momentum in Indonesia remained frail but growing (+1.3% YoY, +1.0% QoQ) while in Malaysia, the momentum picked up, with loans rising at a stronger pace of 2.9% YoY vs. 0.3% YoY in 1Q. Total operating expenses advanced by 7.2% YoY, mostly driven by revenue-related investments (+8.5% YoY). IT related expenses also increased, climbing 20.1% YoY as the group continues to invest in technology and infrastructure to enhance its capabilities. Keeping headcount under a lid, staff costs, which makes up ~55% of total expenses, expanded by 4.5% YoY. Despite the increase in operating expenses, the expense/income ratio remained stable at 45.3%. Total allowances for loans and other assets rose 32% YoY to S$366mn in 1H17. Specific allowances on loans accelerated YoY to S$449mn from S$253mn, led by increases in Singapore, Malaysia and Thailand. By segment, the jump in the specific allowances on loans came largely from the oil and gas and shipping industries. Combined with a release in the general allowance, total credit costs on loans were maintained within management’s guidance at 32 bps. UOB’s NPL ratio stayed pat at 1.5% while the coverage ratio stood at 113.9% from 125.6% a year ago. UOB’s capital position remained healthy with fully loaded Common Equity Tier 1 (CET1) and total capital ratio of 13.3% and 17.8% respectively. Additionally, the group’s all-currency and Singapore dollar liquidity coverage ratios (LCR) currently stand comfortably at 157% and 203%. Share Information Bloomberg Code UOB SP Stock Code U11 Listing STI Share Cap (mn) 1659.4 Market Cap (S$mn) 39908.6 Par Value 1.00 52-wk Hi/Lo (S$) 24.60/17.51 12-mth Avg Daily Vol ('000 shrs) 2638.1 Estimated Free Float (%) 84.5 Beta 1.1 Major Shareholders (%) Wee Investments Ptd Ltd - 7.7 Wah Hin & Co - 5.0 Forecast Revision Forecast Revision (%) Net profit (RMm) Consensus TA's / Consensus (%) Previous Rating FY17 FY18 0.0 0.0 3,201.6 3,426.5 3,296.0 3,592.0 97.1 95.4 Hold (maintained) Financial Indicators FY17 9.5 0.9 45.3 102.5 1.0 88.7 21.6 1.1 FY18 9.6 0.9 46.2 121.5 0.8 89.7 22.7 1.1 % of FY 52.0% 50.0% Within Within Share Performance (%) Price Change 1 mth UOB 4.0 STI 3.2 3 mth 10.3 4.9 6 mth 15.0 9.3 12 mth 33.5 16.1 ROE (%) ROA (%) Cost/Income (%) LLC (%) NPL (%) LD ratio (%) BV/ Share (RM) Price/ BV (x) Scorecard vs TA vs Consensus (12-Mth) Share Price relative to the FBM KLCI Source: Bloomberg Page 1 of 3 www.taonline.com.my
17. TA Securities 31-Jul-17 A Member of the TA Group Impact No change to our earnings estimates . Outlook Management noted that while the global economic outlook is stabilising, there are possibilities of more uncertainties ahead. Nevertheless, Asia’s long-term fundamentals remain strong and UOB’s integrated regional network will position the group to tap on these connectivity opportunities in this region. Growth drivers include ongoing disciplined balance sheet management. In the longer-term, investments will be ramped up to facilitate ongoing initiatives in digitising the bank. Operationally, UOB is seeing good traction in growing customer franchise. In the wholesale banking segment, transaction banking will drive earnings as growth momentum in trade assets accelerate despite competitive market and margin compression. Along with the increase, cash management revenue along with the accumulation of high-quality deposits are expected to be on the uptrend. In the retail segment, the growth momentum remains robust in the Wealth Management division. Demand for housing loans is also picking up in both Singapore and the region. Efforts to help small business owners raise productivity and save costs will continue to help give boost to the business banking division. Valuation TP is maintained at S$25.40, valuing the stock at an implied FY18 PBV of 1.1x. With that, we reiterate our HOLD recommendation on UOB. Earnings Summary (S$mn) 2015 2016 2017F 2018F 2019F Net interest income 4,926.0 4,991.0 5,508.9 5,877.1 5,884.5 Non-interest income 3,121.0 3,071.0 3,308.6 3,629.4 3,982.2 Total income 8,047.0 8,062.0 8,817.5 9,506.4 9,866.7 Total expenses 3,597.0 3,696.0 3,991.7 4,390.8 4,829.9 Operating profit 4,450.0 4,366.0 4,825.8 5,115.6 5,036.7 Pretax profit 3,868.0 3,779.0 3,870.5 4,141.5 4,567.5 Net profit 3,208.0 3,098.0 3,201.6 3,426.5 3,780.2 EPS (sen) 193.3 186.7 192.9 206.5 227.8 FYE Dec EPS growth (%) (1.3) (3.4) 3.3 7.0 10.3 Gross div (sen) 90.0 70.0 70.0 70.0 70.0 Div yield (%) 3.7 2.9 2.9 2.9 2.9 2QFY17 Results Analysis (S$mn) YE 31 Dec 2QFY16 1QFY17 2QFY17 YoY QoQ YTD FY16 YTD FY17 YoY Net interest income 1,211.0 1,303.0 1,356.0 12.0 4.1 2,485.0 2,659.0 7.0 475.0 508.0 517.0 8.8 1.8 907.0 1,026.0 13.1 Fee and commission income Other non interest income Total income 338.0 311.0 310.0 (8.3) (0.3) 600.0 621.0 3.5 2,024.0 2,122.0 2,183.0 7.9 2.9 3,992.0 4,306.0 7.9 Total expenses (927.0) (957.0) (995.0) 7.3 4.0 (1,821.0) (1,952.0) 7.2 Operating profit 1,097.0 1,165.0 1,188.0 8.3 2.0 2,171.0 2,354.0 8.4 Amortisation/impairment (161.0) (186.0) (180.0) 11.8 (3.2) (278.0) (366.0) 31.7 32.0 34.0 24.0 (25.0) (29.4) 2.0 59.0 >100.0 Tax and MI (167.0) (206.0) (188.0) 12.6 (8.7) (329.0) (395.0) 20.1 Net profit 801.0 807.0 844.0 5.4 4.6 1,566.0 1,652.0 5.5 EPS (cents) 48.3 48.6 50.9 5.4 4.6 94.4 99.6 5.5 Share of profit of associates Page 2 of 3
18. TA Securities 31-Jul-17 A Member of the TA Group ( T HI S P AGE I S I NT E N T I ON AL L Y L E FT B L ANK) 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. 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. 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
19. Monday , 31 July, 2017 For Internal Circulation Only TA RESEARCH’S ‘DAILY COMPILED LOCAL TECHNICAL REPORTS’ Local Technical Reports 1. Weekly Technical Stock Picks 2. Daily Money Flow 3. Technical Stock Picks a. FBMKLCI b. Stocks Under Coverage c. PLANTATION Sector d. CONSTRUCTION Sector e. PROPERTY Sector 4. Weekly Ace Market Stock Watch 5. Weekly Small Cap Stock Watch 6. Weekly Stock Screen 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
20. TA Se c u r i t i e s T e c h n i c a l V i e w Monday , July 31, 2017 A M em b e r o f t h e TA G r o u p MENARA TA ONE, 22 JALAN P. RAMLEE, 50250 KUALA LUMPUR, MALAYSIA TEL: +603-20721277 / FAX: +603-20325048 Weekly Technical Stock Picks Malaysia THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Chartist: Stephen Soo Tel: +603-2167 9607 stsoo@ta.com.my ALLIANCE FINANCIAL Upper Middle Lower BOLLINGER BANDS RM RM RM DMI Recent Signal Signal Change 4.00 3.90 3.79 BUY RM3.95 SIMPLE MOVING AVERAGES RM 3.93 RM 3.90 RM 4.01 DAILY MACD Recent Signal BUY Signal Change 10-day 30-day 50-day AMBANK Upper Middle Lower Recent Signal Signal Change BOLLINGER BANDS RM RM RM DMI www.taonline.com.my RM4.94 5.11 5.02 4.93 SELL SIMPLE MOVING AVERAGES RM 5.02 RM 5.02 RM 5.08 DAILY MACD Recent Signal SELL Signal Change 10-day 30-day 50-day Page 1 of 9