Bursa Malaysia Daily Market Report - 9 November

Transcription

1. Monday , 09 November, 2020 TA RESEARCH’S ‘DAILY COMPILED REPORTS’ For Internal Circulation Only N ew s 1. D ai l y M arke t C om men t a ry 2. W eek ly St r at e g y 3 . W eek ly Te ch n i c a l Ou t lo ok Fu nd a me n tal Rep o r ts 1. Bu d get 20 21 R evi ew: Comp reh en si ve B u d get t o Re vit a li se t h e E c on o my 2. Se r ba D i nam i k H ol di ng s B er h a d: B u s y w it h New M aj or P ro je ct s Te ch n ic al R ep o rt s 1. W eek ly Te ch n i c a l St o ck W at ch 2. D ai l y Mon e y F low of T e ch n i c a l St o ck W at ch - FB M K L CI 3. W eek ly A ce M ark et St o ck W at ch 4. W eek ly S m al l C ap St o ck W at ch 5. W eek ly St o ck S cre en 6. W eek ly F ore i gn St o ck W at ch (A U S, HK , F S S T I & U S) Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy and/ 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. Kaladher Govindan – Head of Research TA SECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048 www.ta.com.my
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Daily Market Commentary Monday , 09 November 2020 TA Research, e-mail : taresearch@ta.com.my For Internal Circulation Only KLSE Market Statistics (06.11.2020) Volume (mil) +/-chg (RMmn) Main Market 3,196.3 Warrants 901.2 ACE Market 3,575.8 Bond 0.3 ETF 0.2 LEAP 0.0 Total 7,673.9 Off Market 26.6 -633.7 167.9 1220.7 0.3 -0.1 (0.0) 3,369.7 196.6 1,101.7 0.1 0.7 0.0 4,668.9 -85.4 12.9 329.6 50.7 398.1 0.1 0.1 0.0 -128.0 Major Indices Index +/- chg Malaysia FBMKLCI FBMEMAS FBMSCAP November 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 (mn) 1.05 0.22 0.31 0.33 2.94 0.06 0.61 0.49 297 253 68 2 4 0 624 291 121 53 1 3 0 469 % chg % YTD chg 1,519.64 11,018.97 13,806.10 1,512.00 18.15 128.80 50.38 3.00 1.21 1.18 0.37 0.20 -4.35 -2.69 -2.53 -5.20 28,323.40 11,895.23 5,910.02 24,325.23 2,416.50 25,712.97 2,578.68 1,260.08 5,335.53 3,312.16 2,282.09 6,190.18 -66.78 4.30 3.84 219.95 2.71 17.05 -9.94 -4.24 75.20 -7.97 -17.78 50.57 -0.24 0.04 0.07 0.91 0.11 0.07 -0.38 -0.34 1.43 -0.24 -0.77 0.82 -0.75 32.57 -21.64 2.83 9.96 -8.79 -19.99 -20.24 -15.30 8.59 32.45 -7.39 With multiple buy signals triggered on momentum and trend indicators due to last week's strong sessions, the FBM KLCI should enjoy further upside room this week, as optimism over economic growth increase with the Budget 2021 proposals likely to enhance recovery potential. On the external front, markets are rallying on hopes Democrat candidate Joe Biden will eventually become the new US president, fueling global recovery optimism as he should prove less combative and more accommodative towards China and other major economies, and hence reduce global trade frictions. Given the strong close last Friday, immediate upside hurdles for the index are again revised upwards to the 100-day moving average at 1,534, with subsequent hurdles at 1,550 and 1,580. Immediate support is also revised higher to the 30-day and 200-day moving averages at 1,503 and 1,490, respectively, followed by the rising 10-day moving average at 1,486. Meanwhile, technology related stocks such as Globetronics, Inari Amerton, Malaysia Pacific Industries, SKP Resources, Unisem and VS Industry should stage profit-taking corrections following their recent rally, while construction and property related counters like Gamuda and Sime Darby should be able to attract bargain hunters looking for rotation into economic recovery play. News Bites Top 10 KLCI Movers Based on Mkt Cap. Off Market TADMAX 13.7 @ EFORCE 4.0 @ MERIDIAN-WB 2.9 @ MYEG 2.0 @ MCEHLDG 1.5 @ Review & Outlook Value Value/ +/-chg Volume Up Down (RM) 0.21 0.46 0.01 1.46 2.50 Exchange Rate USD/MYR 4.129 -0.019 USD/JPY 103.230 -0.880 EUR/USD 1.187 0.005 USD/CNY 6.612 -0.003 Counter Mkt Cap. Chg (RM’mn) (RM) MAYBANK 80,713 0.10 TOPGLOV 69,222 0.20 HARTA 62,382 0.20 PBBANK 59,086 0.22 TENAGA 58,758 0.24 MAXIS 40,289 0.13 NESTLE 32,853 0.10 HLBANK 31,952 0.04 DIGI 31,100 0.03 CIMB 30,761 0.04 Vol. (mn) 5.18 39.00 5.27 4.36 3.17 2.53 0.14 0.43 3.29 9.45 Commodities Futures Palm Oil (RM/mt) 3,090.00 -17.00 Crude Oil (Brent) 39.60 -1.05 Gold ($/tr.oz.) 1,951.50 0.50 Important Dates PRESBHD - 1:3 Rights Issue - RI of up to 176.8m shares together with up to 176.8m free warrants. 1 rights share for every for every 3 existing shares held, at an issue price of RM0.20 per rights share, together with 1 warrant for every 1 rights share subscribed. Application Closed: 16/11/2020. LISTING ON: 30/11/2020. • Government predicts the Malaysian economy to rebound between 6.5% and 7.5% in 2021, supported by strong economic fundamentals and well-diversified economy. • The decision to enforce the Conditional Movement Control Order in all states in the Peninsula, except for Perlis, Kelantan and Pahang, from Nov 9 to Dec 6 was made because a stricter and bolder approach has to be taken before the situation becomes worse, said Prime Minister Tan Sri Muhyiddin Yassin. • LKL International Bhd and AT Systematization Bhd have signed a distribution agreement to market, sell and distribute the latter's natural rubber latex gloves and nitrile gloves up to 2.6bn pieces annually. • Four major glove companies namely Top Glove Corporation Bhd, Hartalega Holdings Bhd, Supermax Corporation Bhd and Kossan Rubber Industries Bhd will contribute a total of RM400.0mn to help the government in its fight against Covid-19. • Techfast Holdings Bhd announced that it has signed a letter of intent with Zillion Oil Timor LDA to supply up to 6.4mn barrels of diesel gas oil worth an estimated RM1.1bn. • RHB Bank Bhd confirmed that one of its employees from RHB's Kajang branch in Selangor had been tested positive for Covid-19. • Mr D.I.Y Group (M) Bhd expects its e-commerce platform to grow significantly as more Malaysians have become comfortable with the use of technology and mobile apps, according to its vice president of marketing Andy Chin. • Solarvest Holdings Bhd is venturing into Taiwan via the acquisition of 51% stake in a local renewable energy company Tailai Energy Co Ltd from HsinKing Co Ltd for RM445,230. • Glomac Bhd has launched HappyNest, a three-month digital campaign, its first of many initiatives that will add value and choices to people who are looking to buy a Glomac home. • Globetronics Technology Bhd plans to allocate RM45.0mn to expand its operation next year as it forecasts a stronger growth in 2021. • Jaya Tiasa Holdings Bhd has been focusing on the sale of pre-processed logs in order to maximize the revenue. • Boustead Holdings Bhd said its managing director Datuk Seri Amrin Awaluddin is leaving the group on 15 November 2020 to pursue other opportunities. • Pentamaster Corporation Bhd's net profit for 3QFY20 fell 30.0% YoY to RM15.0mn from RM21.5mn a year ago, due to lower revenue. • Guocoland (Malaysia) Bhd recorded a net profit of RM8.6mn for 1QFY21, compared with a net loss of RM10.0mn in the previous corresponding quarter, due to higher revenue, lower expenses on selling and marketing, higher other net operating income and lower finance costs. • China's exports rose 11.4% from a year earlier in October, higher than the previous month's 9.9% increase and topping economists' projections for a 9.0% gain. • Joe Biden is moving forward as the president-elect, launching his transition effort and preparing a plan to curb the coronavirus pandemic while President Donald Trump weighs legal challenges and has so far refused to concede. 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. Kaladher Govindan, Head of Research MENARA TA ONE, 22 JALAN for TA SECURITIES HOLDINGS BERHAD (14948-M) A PARTICIPATING ORGANISATION OF BURSA MALAYSIA SECURITIES BHD P RAMLEE, 50250 KUALA LUMPUR, MALAYSIA TEL : 603 - 2072 1277. FAX : 603 - 2032 5048 www.ta.com.my
3. Monday , November 09, 2020 FBMKLCI: 1,519.64 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Weekly Strategy Market View, News in Brief: Corporate, Economy, and Share Buybacks Kaladher Govindan Tel: +603-2167 9609 kaladher@ta.com.my www.taonline.com.my Possible “Sell-on-News” Mentality Despite Budget Optimism and M a r k e t V i e w Biden Victory The local blue-chip benchmark FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI) rallied last Friday to close at a fresh three-week high, thanks to strength in key plantation, oil & gas, financials, utility and consumer blue chips as optimism over economic recovery grew given the Budget 2021 proposals, which introduced additional stimulus measures to overcome the adverse impact from the resurgent local COVID-19 transmissions. Week-on-week, the FBM KLCI surged 52.75 points, or 3.6 percent to 1,519.64, with Kuala Lumpur Kepong (+RM1.54), Petronas Dagangan (+98sen), Hong Leong Finance Group (+79sen), Tenaga (+76sen) and Nestle (+70sen) representing most of the gains. Average daily traded volume and value last week rose to 6.85 billion shares worth RM3.7 billion, compared to the 5.27 billion shares and RM4.04 billion average the previous week, fueled by resurgent buying momentum in small caps, ACE Market and penny stocks which again attracted strong retail participation. The strong surge in the FBMKLCI last week was driven by winds of change in the US where Democrat Joe Biden was leading the race to be the next US president. Financial markets around the globe rallied, pinning hopes on him to reshape US policies that were grounded on unilateralism and promote leadership qualities that give importance to global cooperation, especially on issues related to trade, environment, diseases, poverty, war, etc., which was seriously lacking during President Trump’s era. With Joe Biden confirmed as the next US president after garnering 290 electoral votes as at last Saturday, profit taking pressure could set in this week in most global markets, including Bursa Malaysia. As for the US, it has taken comfort that Biden’s election will lead to more stimulus measures to combat Covid-19 and may not give Democrats a free hand in raising taxes as Republicans can still provide the much-needed check and balance in the Senate. However, with Senate votes ending in a tie with both parties having 48 seats each, Democrats may have the full control of Congress if they win the 2 seats in Georgia’s run-off elections next January. Having 50 seats, invokes the constitutional rights of the Vice President, who shall be the President of Senate, to cast a tie-breaking vote. It should be in favour of Democrats as Kamala Harris has been elected as the Vice President. So, I am looking forward to some money flowing out of the US into Asian region next year! Page 1 of 11
4. 9-Nov-20 Locally , the “sell-on-news” mentality could prevail early this week, before buying support returns, as investors liquidate some of their recent gains. This is not surprising and is perfectly in sync with the historical trends post-Budget. Data since the 1997 Asian Financial Crisis showed probability for corrections in the two-week period post-budget is high at 60.9% with an average total return of -1.1% and greater average losses of 3.0%. From a total average return perspective, the FBM KLCI tends to underperform during the first two months of post-budget announcement before bouncing back for a year-end window dressing or New Year rally. This trend could persist as investors wait to see the outcome of the 23rd November voting day to pass the Budget 2021, while more cases of Covid-19 affect market sentiment in the interim period. Any weakness is a buying opportunity as this budget should get the final endorsement when tabled for approval after going through many rounds of policy debates and ministerial replies by then. Besides, the current economic reality should sink in and present ample opportunity for the members of parliament in finding a common ground to agree with this comprehensive largest ever RM322bn budget. Government’s official GDP forecast of 6.5% to 7.5% in 2021 appears realistic with multi-billion allocations for development expenditure going into high impact projects and more incentives going into reviving consumption. Consumer staple is one of the biggest direct beneficiaries from various budget measures. No hike in tax is positive for brewers while the absence of windfall tax is a welcome surprise for glove players although the big four have committed to RM400mn in donation, which is pale in comparison to the huge profits they are enjoying currently from the strong glove demand. Telcos will benefit from JENDELA, multibillion allocation for broadband and Jaringan Prihatin Programme. Construction players should benefit from the RM69bn development expenditure that goes into various urban and rural development projects involving infrastructure, road maintenance, sports facilities, hospitals, flood mitigation projects, etc. Property sector also could enjoy improved demand from continuation in measures to assist first time house buyers and low-to-medium income group. Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy and/ 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. Kaladher Govindan – Head of Research TA SECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048 www.ta.com.my Page 2 of 11
5. 9-Nov-20 N e w s I n B r i e f Corporate LKL International Bhd (Not Rated) and AT Systematization Bhd (Not Rated) have signed a distribution agreement to market, sell and distribute the latter's natural rubber latex gloves and nitrile gloves. The agreement is for an initial period of one year from the agreement date and renewable thereafter. The gloves will be mainly distributed to hospitals and healthcare providers with a targeted volume of up to 2.6bn pieces annually. (Bursa Malaysia/New Straits Times) Four major glove companies namely Top Glove Corporation Bhd, Hartalega Holdings Bhd, Supermax Corporation Bhd and Kossan Rubber Industries Bhd will contribute a total of RM400.0mn to help the government in its fight against Covid-19. (New Straits Times) Techfast Holdings Bhd (Not Rated) announced that it has signed a letter of intent (LOI) with Zillion Oil Timor LDA to supply up to 6.4mn barrels of diesel gas oil worth an estimated RM1.1bn. The LOI is for three years, starting Jan 1, 2021 until Dec 31, 2023. The estimated contract value is based on the present oil price. (Bursa Malaysia/The Edge) RHB Bank Bhd (RHB) confirmed that one of its employees from RHB’s Kajang branch in Selangor had been tested positive for Covid-19. The bank said deep cleaning and sanitisation activities had been carried out in accordance with the Ministry of Health guidelines. (Bernama) Mr D.I.Y Group (M) Bhd (Not Rated) expects its e-commerce platform to grow significantly as more Malaysians have become comfortable with the use of technology and mobile apps, according to its vice president of marketing Andy Chin. (Bernama) Solarvest Holdings Bhd (Not Rated) is venturing into Taiwan via the acquisition of majority stake in a local renewable energy company. The group has entered into a deal to buy a 51% stake in Tailai Energy Co Ltd from HsinKing Co Ltd for RM445,230. The purchase consideration will be funded via internally generated funds. (Bursa Malaysia/The Star) Boustead Holdings Bhd (Not Rated) said its managing director Datuk Seri Amrin Awaluddin is leaving the group on 15 November 2020 to pursue other opportunities. The group has commenced the formal process of identifying a candidate for the vacant position. (Bursa Malaysia/The Star) Glomac Bhd has launched HappyNest, a three-month digital campaign. It is the first of many initiatives that will add value and choices to people who are looking to buy a Glomac home. (The Edge) Smart sensor producer Globetronics Technology Bhd (Not Rated) plans to allocate RM45.0mn to expand its operation next year as it forecasts a stronger growth in 2021, according to its group chief executive officer Datuk Heng Huck Lee. (The Star) Jaya Tiasa Holdings Bhd (Not Rated) has been focusing on the sale of pre-processed logs in order to maximize the revenue, according to its chief executive officer Datuk Wong Sie Young. (The Star) Pentamaster Corporation Bhd’s (Not Rated) net profit for 3QFY20 fell 30.0% YoY to RM15.0mn from RM21.5mn a year ago, due to lower revenue. Quarterly revenue dropped 15.4% YoY to RM105.4mn from RM124.6mn a year ago as the group suffered from delay in product shipment and site installation as a result of global travel restrictions. For 9MFY20, the group’s net profit decreased 19.4% YoY to RM48.8mn, from RM60.6mn a year ago while revenue fell 15.3% YoY to RM308.6mn from RM364.1mn. (Bursa Malaysia/The Edge) Page 3 of 11
6. 9-Nov-20 Guocoland (Malaysia) Bhd (Not Rated) recorded a net profit of RM8.6mn for 1QFY21, compared with a net loss of RM10.0mn in the previous corresponding quarter, due to higher revenue, lower expenses on selling and marketing, higher other net operating income and lower finance costs. Meanwhile, quarterly revenue jumped 88.2% YoY to RM90.9mn, from RM48.3mn previously, mainly due to the increase in sales and higher recognition of percentage of completion from on-going projects. (Bursa Malaysia/The Sun) [ TH E RE M A ININ G OF T H IS P A GE IS IN TE N TI O NA L L Y L E F T BL AN K] Page 4 of 11
7. 9-Nov-20 N e w s I n B r i e f Economy Malaysi a Malaysia ’s GDP to Expand 6.5% to 7.5% in 2021 The Malaysian economy is projected to rebound between 6.5% and 7.5% in 2021, supported by strong economic fundamentals and well-diversified economy. In its Economic Report 2020, the Finance Ministry, however, said the favourable outlook hinges on two major factors - the successful containment of the Covid-19 pandemic and sustained recovery in external demand. The country’s economy contracted by 8.3% in the first half of 2020, with a decline of 17.1% in the second quarter. The economy is expected to contract at a slower pace in the second half of the year, aided by the speedy implementation of various stimulus packages to support the people and revitalise the economy. In 2020, the economy is expected to contract by 4.5, that the impact of the packages is anticipated to have spill-over effects and provide an additional boost to the economy in 2021. In 2021, the global economy is projected to recover with a growth of 5.2%. The advanced economies are forecast to rebound by 3.9%. With the normalisation of economic activities in 2021, all subsectors are projected to record positive growth. In 2021, Gross National Income (GNI) is projected to rebound by 7.8% to RM1.53tn, while gross national savings (GNS) by 2% to RM335bn. Gross exports are expected to rebound by 2.7% in 2021, benefiting from the recovery in global trade and supply chains. Gross imports are expected to turnaround by 5.3% in 2021, supported by an increase in all types of imports. Meanwhile, the consumer price index (CPI) is expected to normalise at 2.5% in 2021 in line with better economic prospects and higher crude prices. Total employed persons are projected at 15.1mn in 2020 and further expand to 15.3mn in 2021. Of the 15.3mn employed, 9.7mn, or 63.3% will be recruited in the services sector, 17.4% in the manufacturing and 10.2% in the agriculture sectors. (The Star) Budget to Focus on Boosting Recovery The government expects 2021 will be a transition year for the country’s economic recovery as it expects growth to be revitalised, together with restored investor and consumer confidence. In the Fiscal Outlook 2021, it said the Budget allocation will focus on helping recovery including reviving business activities, developing public infrastructure, promoting upskilling and reskilling programmes. The allocation will also focus on building the nation’s resilience against future economic shocks, including the possibility of a resurgence of Covid-19 cases. Expenditure will be prioritised towards targeted economic sectors to ensure a high multiplier impact and quality investment as well as to protect the well-being of the rakyat and to support businesses. The Federal Government has to balance the needs to support the recovery phase and ensure sound public finances. It emphasised its focus was on fiscal reform and resuming its fiscal consolidation in the medium term. The efforts will be supported through the enhancement of good practices in expenditure management, which includes minimising leakages through closer monitoring of budget execution and increasing spending efficiency. A total of RM322.5bn or 20.6% of GDP will be allocated in the 2021 Budget. Of this, RM236.5bn of 73.3% will be for operating expenditure, RM69bn or 21.4% to development expenditure and RM17bn (5.3%) for the Covid-19 fund. (The Star) Page 5 of 11
8. 9-Nov-20 Deficit to average 4 .5% of GDP in 2021-23 The government targets the fiscal deficit to average 4.5% under the Medium-term Fiscal Framework 2021-2023 while debt is expected to increase but at a manageable pace. In the Fiscal Outlook, it said the framework provided a macro-fiscal projection over three years where it sets targets for revenue and expenditure as a guide for the government’s fiscal path over this period. The framework was based on updated macroeconomic and fiscal assumptions after including impact of Covid-19 crisis. The assumptions include real GDP of 4.5% and 5.5% (nominal GDP growth of 5.5% and 6.5%), crude oil prices between US$45 and US$55 per barrel and crude oil production of 580,000 barrels per day. It also assumed total revenue to reach RM731bn or 14.7% of GDP, mainly contributed by non-petroleum revenue of RM609.7bn or 12.3% of GDP. As for petroleum-related revenue, it was projected at RM121.3bn or 2.4% of GDP. It said the government would seek to boost revenue by exploring new sources, widening revenue base, improving tax administration and adopting the medium-term revenue strategy (MTRS). The total indicative ceiling for the three-year expenditure estimated at RM959.8bn or 19.3% of GDP. The Government expects its fiscal deficit to swell to 6% of Gross Domestic Product (GDP) in 2020 — the largest gap since the Global Financial Crisis in 2009, due to the additional stimulus packages to lift the country’s economy out of the doldrums plus lower GDP as a result of the COVID-19 outbreak. The original forecast of the fiscal deficit was at 3.2%, as compared with 3.4% recorded in 2019. Excluding debt service charges, the primary balance is estimated to record a higher deficit of 3.6% in 2020 versus 1.2% in 2019. Still, the primary deficit gap is narrower compared with 4.7% in 2009. (The Star, The Edge) Implementation of CMCO to Prevent Situation from Becoming Worse The decision to enforce the Conditional Movement Control Order (CMCO) in all states in the Peninsula, except for Perlis, Kelantan and Pahang, from Nov 9 to Dec 6 was made because a stricter and bolder approach has to be taken before the situation becomes worse, said Prime Minister Tan Sri Muhyiddin Yassin. He said the spike in new Covid-19 cases had caused concern and anxiety among the people and the country could no longer remain under the Recovery Movement Control Order (RMCO). “As such, the special meeting of the National Security Council (MKN) decided to implement the CMCO in all states in the Peninsula, except for Perlis, Kelantan and Pahang. Muhyiddin said the ban on interstate travel also had to be implemented to reduce public movement and social activities in a bid to break the chain of Covid-19 infection. Meanwhile, he said the Sarawak government had also tabled its Covid-19 Preparation Plan for the state at the MKN meeting. Muhyiddin said the Sarawak government had also applied for more beds for the intensive care units (ICUs) as well as to increase the capacity of laboratories carrying out Covid-19 screenings at the seven government hospitals in the state. The prime minister requested the state government to hold further discussions with the Ministry of Health to study its needs. He also hoped that all the approaches decided on would help to reduce the number of new Covid-19 cases to ensure the safety and continuity of people's lives. (The Edge) Bank Negara Foreign Reserves Fall to US$104.6bn as at Oct 30 Bank Negara's international reserves fell US$600mn to US$104.6bn as at Oct 30, 2020 from US$105.2bn two weeks earlier. The central bank said the reserves position is sufficient to finance 8.4 months of retained imports and is one times total short-term external debt The main components of the international reserves comprised foreign currency reserves at US$97.1bn, International Monetary Fund reserves position (US$1.4bn), Special Drawing Rights (SDRs) (US$1.2bn), gold (US$2.4bn) and other reserve assets (US$2.5bn). (The Star, BNM) Page 6 of 11
9. 9-Nov-20 Public Sector Debt Higher at RM1 .23tn Public sector debt rose to RM1.23tn or 85.5% of GDP as at end June 2020, due to higher Federal Government fiscal deficit to finance the Covid-19 pandemic stimulus measures. The report said the Federal Government debt at RM854.1bn or 69.4% of total debt, followed by non-financial public corporations (NFPCs) at 24.4% and statutory bodies 6.2%. The NFPCs’ debt rose to RM300.4bn, which included additional funding facilities drawdown to finance capex to develop the mass rapid transit (MRT) project and investments in oil and gas sector. Due to the uncertain economic environment in 2021, gross borrowing requirements are expected to remain substantial at around 11% of GDP. The government will continue to finance stimulus measures during the transition phase in 2021, to fully support the economic recovery. The emphasis will be on ensuring the well-being of the rakyat, protecting the businesses and revitalising economic activities. The impact of the Covid-19 pandemic and the fallout on the economy saw the government undertaking swift measures to protect lives, support businesses and strengthen the economy. The increase in borrowing needs, the Federal Government debt is projected to increase to around 61% of GDP, with the statutory debt to remain around 58% in 2021. (The Star) Asia Japan Household Spending Slumps as COVID-19 Pain Lingers Japan's household spending slumped 10.2% in September from a year earlier, government data showed, a sign sluggish domestic demand will continue to drag on any recovery for the world's third-largest economy. The data underscores the challenge policymakers face in balancing the need to prevent the spread of the coronavirus pandemic and reviving economic activity. The drop in household spending compared with a median market forecast for a 10.7% decline and followed a 6.9% fall in August. Separate data released on Friday showed Japan's inflation-adjusted real wages fell for the seventh straight month in September, suggesting that sliding household income could further dent consumption. Japan's economy is bottoming out after suffering its worst postwar slump in April-June, thanks in part to a rebound in exports and output. But weak consumption and capital spending is likely to keep any economic recovery modest, analysts say. The Bank of Japan trimmed its economic growth forecast for the year ended in March 2021 and warned that consumption may remain weak for some time, particularly for services hit by social distancing policies to contain the pandemic. With the BOJ left with little policy ammunition to jump-start growth, the onus is on the government to deploy more fiscal stimulus to cushion the blow from the pandemic, they say. Prime Minister Yoshihide Suga is expected to announce this month a plan for fresh stimulus to help the recession-stricken economy shake off the coronavirus crisis, sources have told Reuters. (The Star, Reuters) China Exports Roar Ahead; Trade Surplus with U.S., World Widens China’s trade surplus with the U.S. and the rest of the world widened in October as the global recovery buoyed demand for made-in-China goods, helping export growth beat market expectations for a seventh straight month. China’s exports rose 11.4% from a year earlier in October—higher than the previous month’s 9.9% increase and topping economists’ projections for a 9.0% gain—according to data released by China’s General Administration of Customs. China’s imports, meantime, rose by a more modest 4.7% in October from a year earlier, down from September’s 13.2% increase and lower than the 8.3% increase expected by surveyed economists. Taken together, the trade data meant China’s trade surplus ballooned to US$58.4bn in October, from US$37bn the previous month, according to official data. Economists had expected China to record a US$47.8bn surplus. Page 7 of 11
10. 9-Nov-20 China ’s outbound shipments have defied market expectations since April, as the nation’s factories began coming back online. In recent months, overseas sales of pandemic-related medical gear and work-from-home computer products have remained surprisingly resilient, serving as twin pillars for China’s export sector. That has helped the world’s second-largest economy shrug off expectations for a tapering off of overseas sales as other exporting countries come back online. China’s trade surplus with the U.S. widened slightly to US$31.37bn in October, from US$30.75bn in September. China’s exports to the U.S., its third-largest trading partner, rose 22.5% year-over-year in dollar terms in October, while shipments to the Association of Southeast Asian Nations and the European Union, China’s No. 1 and No. 2 trading partners, rose 7% and fell 7% respectively from a year earlier. (WSJ) RBA Expects Economy to Recover at Faster than Expected Pace The Reserve Bank of Australia (RBA) said it expects the economy to recover over coming quarters at a faster than previously estimate pace. However, the economy is likely to be noticeably smaller at the end of the forecast period than anticipated prior to the pandemic, partially because of a sharp slowing in population growth, the bank said in the Statement of Monetary Policy, released Friday. Gross domestic product is forecast to grow 6% in the year ending June 2021 compared to the previous projection of 4 percent. At the same time, the outlook for the year ending June 2022 was retained at 4%. The unemployment rate is expected to peak a little below 8% around the end of the year. This peak represents a very high level of spare capacity in the labor market, the bank noted. The unemployment rate is expected to decline only gradually, to just above 6% by the end of 2022. Both headline and trimmed mean inflation are forecast to bottom out below 1% in 2021, and reach 1.5% by end 2022. According to RBA forecast, population growth will be 0.2% in 2020/21 and 0.4% in 2021/22. This was the slowest rate of population growth since the First World War. (RTT) Singapore’s Economic Rebound Unlikely to Be ‘Vibrant,’ PM Lee Says Singapore’s economy is unlikely to pick up in a “very vibrant sort of way very soon” as key export markets in Europe and the U.S. face renewed coronavirus outbreaks, Prime Minister Lee Hsien Loong said. While many sectors have shown improvement since lockdown measures were relaxed, some such as aviation, transport and tourism are likely to remain in “suspended animation” for some time because of second waves in other parts of the world, Lee said in a speech to members of his ruling party on Sunday. For Singapore, the government needs to balance an easing of restrictions as it runs the risk of cases shooting up again, he said. “We can’t simply relax the current restrictions, and hope that Covid19 cases will remain low,” Lee said. “The more we open up and resume normal activities, the more likely it is that we will have new cases, including from overseas, either from visitors or returning Singaporeans.” The island nation’s economy contracted 7% in the third quarter from a year ago and the overall unemployment rate climbed to its highest level since 2004. Lee reiterated on Sunday that leadership renewal remains one of his top priorities. He had previously signaled he would step aside by the time he turns 70 in 2022, but also later said he was determined to see the pandemic through and wanted to hand over Singapore “intact” and in “good working order” to the next generation of leaders. (Bloomberg) Page 8 of 11
11. 9-Nov-20 United St ates Biden Launches Transition , Covid Plan as Trump Eyes Court Fight Joe Biden is moving forward as the president-elect, launching his transition effort and preparing a plan to curb the coronavirus pandemic while President Donald Trump weighs legal challenges and has so far refused to concede. Biden will announce his transition’s coronavirus task force on Monday, the first core policy step since being declared the winner of the presidential race on Saturday. He’ll also reach out to Republicans and Democrats in Congress to discuss a new relief package, with one Biden ally calling on Trump to support one before Biden is sworn in on Jan. 20. The former vice president won or is leading in states that would award him 306 electoral college votes, well above the victory threshold of 270. But Trump has falsely claimed victory while alleging widespread illegal voting, without any evidence. White House staff have faced a leadership vacuum in the days since the election. Biden nonetheless moved ahead, signaling to the American people and U.S. allies that he plans for a peaceful and smooth transfer of power. He said his mandate is to curb the coronavirus pandemic, rebuild the economy, fight climate change, root out systemic racism, and expand access to health care -- and attempt to restore a bipartisan spirit in bitterly divided Washington, where Republicans have largely yet to acknowledge his win. (Bloomberg) Drop in Jobless Rate Shows Healing U.S. Labor Market The U.S. labor market regained another chunk of jobs lost during the pandemic-induced recession, sending unemployment down sharply in October amid other signs the economy is recovering. Employers added 638,000 jobs last month—the sixth straight monthly gain— and the jobless rate fell a percentage point to 6.9%, the Labor Department said Friday. The job market has now recovered 12.1mn of the 22mn jobs lost in March and April, when the shutdown of businesses led the jobless rate to soar to a post-World War II high of 14.7%. October’s job gain would have been higher without the release of temporary census workers from public payrolls. Private-sector employers added 906,000 jobs last month, a pickup from September, more than offsetting a drop of 268,000 jobs in the public sector. Industries that hired the most workers last month included leisure and hospitality— particularly restaurants—retail and construction. Still, job growth has slowed each month since June. And optimism about Friday’s report—which was derived from surveys in midOctober—was tempered by more recent data showing falling employment at small businesses and slower hiring in service industries overall. The recent rise in virus infections, the fading effects of federal relief measures and the onset of winter—which could force patrons indoors—are likely to weigh on the labor market recovery, economists say. (WSJ) U.S. Consumer Borrowing Rose More Than Forecast in September U.S. consumer borrowing rose in September by twice as much as forecast, reflecting an acceleration in non-revolving credit such as auto loans and the first pickup in credit-card balances in seven months. Total credit increased US$16.2bn from the prior month after a revised US$6.9bn drop in August, Federal Reserve figures showed Friday. The figure topped all estimates in a Bloomberg survey of economists that had called for an US$8bn rise. Overall, consumer credit totaled US$4.16tn, inching closer to February’s record US$4.21tn level, the central bank’s latest figures show. The improvement in revolving credit was in line with retail sales growth and indicates spending is picking up after moderating in July and August, while the gain in non-revolving credit -- which includes vehicle and school loans -- underscores recent auto sales strength. Non-revolving debt climbed US$12.2bn to US$3.17tn, while revolving credit increased by almost US$4bn to US$989bn. Lending by the federal government, which is mainly for student loans, rose by US$8.4bn before seasonal adjustment. The report doesn’t track debt secured by real estate, such as home mortgages. (Bloomberg) Page 9 of 11
12. 9-Nov-20 U .S. Wholesale Inventories Unexpectedly Rise 0.4% in September A report released by the Commerce Department showed an unexpected increase in U.S. wholesale inventories in the month of September. The Commerce Department said wholesale inventories rose by 0.4% in September after climbing by 0.5% in August. Economists had expected inventories to edge down by 0.1%. The unexpected increase in wholesale inventories came as inventories of non-durable goods advanced by 0.7%, while inventories of durable goods inched up by 0.1%. Meanwhile, the report said wholesale sales crept up by 0.1% in September after jumping by 1.2% in August. A 0.7% increase in sales of durable goods was partly offset by a 0.5% decrease in sales of non-durable goods. The inventories/sales ratio for merchant wholesalers subsequently came in at 1.31 in September, unchanged from the previous month. (RTT) Eurozone & United Kingdom UK House Price Inflation Highest Since Mid-2016 UK house prices increased at the fastest pace since mid-2016, data released by the Lloyds Bank subsidiary Halifax and IHS Markit showed. House prices increased 7.5% on a yearly basis in three months to October from the same period last year, the strongest rise since June 2016. Prices had advanced 7.3% in three months to September. On a monthly basis, house price inflation slowed to 0.3% from 1.5% in September. Russell Galley, Managing Director, Halifax, said for the first time in history, average house price exceeded a quarter of a million pounds. This level of price inflation is underpinned by unusually high levels of demand, with latest industry figures showing home-buyer mortgage approvals at their highest level since 2007, as transaction levels continue to be supercharged by pent-up demand as a result of the spring/summer lockdown, as well as the Chancellor's waiver on stamp duty for properties up to GBP 500,000. With a number of clear headwinds facing the housing market, Halifax expects to see greater downward pressure on house prices moving into 2021. (RTT) Germany's Industrial Production Growth Improves Germany's industrial production growth accelerated in September, albeit at slower than expected pace ahead of new restrictions imposed to contain the coronavirus, data released by Destatis showed. Industrial output climbed 1.6% on month, bigger than the revised 0.5% rise seen in August but slower than economists' forecast of 2.7%. Excluding energy and construction, production in industry was up 2.0% in September. Within industry, production of intermediate goods showed an increase of 1.4%. Output of consumer goods advanced 3.0% and that of capital goods by 2.2%. Production in the automotive industry, the largest segment of manufacturing, grew 10% on the previous month. Outside industry, energy production was down 2.5%, while construction output grew 1.5%. Data showed that annual fall in industrial production came in at 7.3% in September. However, this was slower than the 8.7% fall logged in August. (RTT) Page 10 of 11
13. 9-Nov-20 N e w s I n B r i e f Share Buy-Back Share Buy-Back : 06 November 2020 Company BKAWAN COASTAL COCOLND ENGTEX FIMACOR HAIO IBHD KFIMA OSK PTRANS RANHILL SEM WCT WTK YINSON Bought Back Price (RM) Hi/Lo (RM) 30,600 35,500 30,000 187,500 5,000 8,000 9,100 34,900 15.32/15.24 0.59 1.70 0.47 1.49 2.06/2.00 0.17 1.45/1.42 15.32/15.20 0.60/0.57 1.72/1.70 0.48/0.465 1.49 2.06/1.99 0.175/0.17 1.45/1.42 41,600 0.75 0.765/0.745 600,000 0.26 0.265/0.255 135,000 0.835/0.83 0.835/0.83 649,200 1.34/1.32 1.36/1.32 812,500 0.395/0.39 0.405/0.385 650,000 0.46/0.445 0.465/0.445 13,300 4.53 4.62/4.52 Total Treasury Shares 1,974,300 11,109,200 1,050,200 6,976,200 6,833,800 10,456,188 7,297,600 3,262,200 33,197,453 30,700,000 2,832,926 101,700,000 10,617,627 9,753,900 33,859,300 Source: Bursa Malaysia Conference call by TA RESEARCH – Remisiers’ Briefing Topic: Weekly Market Outlook Speaker: Mr. Kaladher / Mr. Stephen Soo Date: 09 November 2020 (Monday) Time: 12.45pm Time: 12.30pm. Signing in of attendees (Please provide full name, Branch) Time: 12.45pm. Event Start Note: We are transitioning towards using Microsoft Teams instead of Go-to-Meeting. Please join the meeting from your computer, tablet or smartphone (if you have already installed the app) https://bit.ly/3l0iVZX This briefing is an exclusive invitation to Remisiers, Dealers and selective personnel only (Limited to 250 pax on first come basis) Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy and/ 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. Kaladher Govindan – Head of Research TA SECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048 www.ta.com.my Page 11 of 11
14. For Internal Circulation Only SNAPSHOT OF STOCKS UNDER COVERAGE Company Share Price Target Price (RM) (RM) % upside Recom Market Cap. (RMm) Beta EPS (sen) FY20 PER (X) Div Yield (%) FY21 FY20 FY21 FY20 52weeks 52weeks % Chg FY21 High Price % Chg Low Price % Chg YTD 06-Nov-20 AUTOMOBILE BAUTO 1.25 1.53 22.4% Buy 1,452 1.19 8.7 8.8 14.4 14.2 6.0 4.6 2.23 -43.9 0.94 33.7 -40.5 MBMR 2.89 3.62 25.3% Buy 1,130 1.17 35.1 40.3 8.2 7.2 6.2 6.9 4.13 -30.0 2.50 15.6 -25.1 PECCA 1.51 0.89 -41.1% Sell 261 0.88 4.7 8.1 32.1 18.6 3.1 3.3 1.61 -6.2 0.68 123.7 38.5 SIME 2.47 2.43 -1.6% Sell 16,800 0.90 15.0 15.0 16.5 16.4 4.0 4.3 2.58 -4.2 1.55 59.0 11.7 UMW 2.42 1.85 -23.6% Sell 2,827 1.82 15.5 26.9 15.6 9.0 1.7 1.7 4.70 -48.5 1.65 46.7 -46.1 BANKS & FINANCIAL SERVICES ABMB 2.29 2.10 -8.3% Sell 3,545 1.10 27.4 22.0 8.4 10.4 2.6 3.5 2.96 -22.6 1.48 54.7 -12.9 AFFIN 1.40 1.80 28.6% Buy 2,912 0.99 19.0 23.2 7.4 6.0 2.1 3.6 2.03 -31.0 1.25 12.0 -26.3 AMBANK 3.00 3.20 6.7% Buy 9,029 0.97 44.5 36.0 6.7 8.3 4.4 4.0 4.20 -28.6 2.80 7.1 -23.3 CIMB 3.10 3.20 3.2% Hold 30,761 1.02 15.8 29.0 19.6 10.7 2.6 4.8 5.40 -42.6 2.90 6.9 -39.8 HLBANK 14.74 15.00 1.8% Sell 31,952 1.10 115.1 114.5 12.8 12.9 2.4 2.7 17.76 -17.0 11.70 26.0 -14.8 MAYBANK 7.18 7.70 7.2% Buy 80,713 0.82 51.9 57.3 13.8 12.5 5.6 6.3 8.86 -19.0 6.96 3.2 -16.9 PBBANK 15.22 17.20 13.0% Buy 59,086 1.24 120.7 125.8 12.6 12.1 3.6 3.8 20.20 -24.7 12.58 21.0 -21.7 RHBBANK 4.35 5.40 24.1% Buy 17,444 0.98 46.4 57.2 9.4 7.6 4.1 5.1 5.98 -27.3 4.17 4.3 -24.7 BURSA 8.50 8.30 -2.4% Sell 6,877 1.23 42.1 26.9 20.2 31.6 4.4 2.8 10.98 -22.6 4.32 96.8 39.6 ANNJOO 0.63 0.42 -33.3% Sell 340 1.62 -16.5 2.1 na 30.0 0.0 1.4 1.40 -55.0 0.42 51.8 -48.4 CHINHIN 1.39 0.40 -71.2% Sell 767 0.45 0.3 3.9 522.5 35.3 1.1 1.1 1.45 -4.1 0.40 247.5 93.1 CHINWEL 0.96 0.90 -6.2% Sell 278 1.17 7.4 13.9 12.9 6.9 1.6 5.7 1.65 -41.8 0.68 41.2 -30.4 BUILDING MATERIALS CMSB 1.24 1.76 41.9% Buy 1,330 1.44 9.1 16.3 13.6 7.6 1.6 2.0 2.50 -50.4 0.83 49.4 -45.4 CSCSTEL 0.82 0.90 9.8% Hold 303 1.30 5.2 9.1 15.7 9.0 3.1 5.4 1.19 -31.1 0.54 51.9 -22.6 ENGTEX 0.47 0.47 0.0% Sell 205 0.45 0.5 2.2 102.7 21.7 1.0 1.1 0.87 -45.7 0.42 11.9 -37.3 GADANG 0.40 0.29 -26.6% Sell 288 1.84 5.8 4.0 6.9 9.9 2.5 2.5 0.77 -48.7 0.23 75.6 -43.2 GAMUDA 3.69 3.50 -5.1% Sell 9,275 1.27 20.7 26.7 17.8 13.8 1.6 3.3 4.30 -14.2 2.36 56.4 -5.4 GDB 0.69 0.95 37.7% Buy 431 1.19 4.3 7.9 16.2 8.7 2.9 2.9 0.80 -13.2 0.33 109.1 12.2 IJM 1.45 1.48 2.1% Sell 5,251 1.30 6.9 2.3 21.0 63.0 2.1 2.8 2.33 -37.8 1.15 26.1 -33.2 INTA 0.30 0.53 76.7% Buy 161 1.28 1.4 4.8 21.4 6.2 0.8 2.5 0.40 -25.0 0.15 100.0 11.1 KAB 0.93 0.19 -79.5% Sell 856 0.76 0.9 1.2 100.7 78.1 0.8 0.4 1.22 -24.2 0.24 289.8 140.4 15.9 CONSTRUCTION PESONA 0.26 0.24 -7.8% Sell 177 1.00 0.3 2.4 90.6 10.5 0.0 3.9 0.30 -15.0 0.13 96.2 SUNCON 1.82 1.84 1.1% Sell 2,347 0.89 6.6 10.2 27.8 17.8 2.5 3.8 2.10 -13.3 1.25 45.6 -4.7 WCT 0.40 0.34 -15.2% Sell 556 1.83 -1.3 1.7 na 23.8 0.0 0.0 0.90 -56.2 0.24 62.8 -54.1 LITRAK 3.94 4.84 22.8% Buy 2,099 0.65 49.2 45.7 8.0 8.6 6.3 7.6 4.95 -20.4 3.30 19.4 -14.2 CARLSBG 19.88 24.50 23.2% Buy 6,078 1.19 65.2 89.8 30.5 22.1 3.0 4.5 39.17 -49.2 17.34 14.6 -32.2 HEIM 19.00 26.00 36.8% Buy 5,740 0.92 68.9 96.9 27.6 19.6 3.4 4.9 31.74 -40.1 17.30 9.8 -29.9 AEON 0.70 1.25 78.6% Buy 983 0.99 6.6 8.9 10.7 7.9 5.7 5.7 1.63 -57.1 0.67 4.5 -50.7 AMWAY 5.10 6.00 17.6% Buy 838 0.62 28.3 31.7 18.0 16.1 5.4 5.4 6.00 -15.0 4.50 13.3 -9.4 F&N 32.00 40.00 25.0% Buy 11,737 0.60 114.2 117.5 28.0 27.2 1.9 2.0 35.68 -10.3 24.12 32.7 -8.2 FOCUSP 0.61 0.76 24.6% Buy 134 0.67 3.6 5.1 16.8 12.0 2.6 3.8 0.77 -20.8 0.29 110.3 64.9 HUPSENG 0.92 1.00 8.7% Hold 736 0.58 5.1 5.7 18.1 16.0 6.5 6.5 1.08 -14.8 0.75 23.5 2.2 JOHOTIN 1.62 2.10 29.6% Buy 498 1.23 13.2 17.1 12.3 9.5 3.7 4.3 1.90 -14.7 0.98 65.3 -6.4 -20.5 CONSUMER Brewery Retail LHI 0.70 0.91 30.0% Buy 2,555 na 3.6 5.1 19.5 13.8 1.5 2.2 0.97 -27.8 0.43 62.8 NESTLE 140.10 143.00 2.1% Sell 32,853 0.49 247.0 290.3 56.7 48.3 1.8 2.0 149.90 -6.5 120.00 16.8 -4.7 PADINI 2.04 2.90 42.2% Buy 1,342 0.96 13.0 18.5 15.7 11.0 3.7 4.4 3.66 -44.3 1.78 14.6 -37.0 POHUAT 1.89 1.77 -6.3% Buy 501 1.19 15.5 18.5 12.2 10.2 3.7 3.7 1.95 -3.1 0.69 173.9 24.3 QL 6.52 7.00 7.4% Hold 15,867 0.69 9.8 11.0 66.3 59.1 0.5 0.5 7.20 -9.4 4.33 50.5 20.3 SCIENTX 11.92 11.80 -1.0% Buy 6,161 0.76 74.4 84.7 16.0 14.1 1.9 2.3 12.90 -7.6 5.96 100.0 26.1 Note: SCIENTX proposed 2 for 1 bonus issue shares and 1 for 5 free warrants. For more detail please refer to 21-Sept-20 report. SIGN 0.33 0.60 81.8% Buy 81 1.64 0.0 3.4 na 9.6 5.5 5.5 0.50 -33.3 0.16 112.9 -26.7 10.22 14.50 41.9% Buy 2,918 0.79 92.0 97.7 11.1 10.5 8.8 9.3 18.00 -43.2 9.26 10.4 -32.2 GENTING 3.06 4.89 59.8% Buy 11,783 1.28 -9.6 21.6 na 14.2 2.1 5.9 6.12 -50.0 2.91 5.2 -48.3 GENM 2.11 3.04 44.1% Buy 11,928 1.03 -13.7 12.1 na 17.5 2.8 3.8 3.26 -35.3 1.83 15.3 -33.6 1.94 2.40 23.7% Buy 2,606 0.71 10.1 17.1 19.2 11.4 5.4 8.2 2.65 -26.9 1.88 3.2 -24.1 Tobacco BAT GAMING Casino NFO BJTOTO HEALTHCARE Hospitals/ Pharmaceutical DPHARMA 4.10 1.97 -52.0% Sell 2,895 0.70 8.4 9.4 48.8 43.6 1.3 1.5 4.32 -5.1 1.05 290.5 188.7 IHH 5.27 6.00 13.9% Hold 46,256 0.73 6.2 10.8 85.5 48.7 0.4 0.6 5.94 -11.3 4.55 15.8 -3.7 KPJ 0.87 0.95 9.8% Buy 3,702 0.78 2.8 4.3 30.5 20.3 1.3 2.0 1.04 -16.8 0.72 20.1 -8.5 HARTA 18.20 25.97 42.7% Buy 62,382 1.23 12.7 81.7 143.9 22.3 0.4 2.7 21.16 -14.0 5.08 258.3 232.1 KOSSAN 7.49 10.30 37.5% Buy 19,158 1.07 45.4 64.4 16.5 11.6 2.4 3.4 9.75 -23.2 2.00 274.5 260.1 SUPERMX 9.78 12.33 26.1% Buy 25,122 1.88 20.5 147.9 47.8 6.6 0.0 5.7 12.22 -20.0 0.65 1416.3 1307.2 TOPGLOV 8.50 10.80 27.1% Buy 69,222 1.25 22.9 125.3 37.1 6.8 1.4 8.1 9.77 -13.0 1.44 488.9 ALLIANZ 13.16 17.08 29.8% Buy 2,328 0.90 248.2 277.0 5.3 4.8 3.8 4.2 16.87 -22.0 11.40 15.4 -18.4 TUNEPRO 0.31 0.24 -22.6% Sell 233 1.28 3.1 6.1 10.1 5.1 3.9 7.9 0.63 -50.4 0.20 55.0 -45.1 ASTRO 0.75 1.07 43.6% Buy 3,885 1.02 12.6 9.8 5.9 7.6 10.1 6.7 1.48 -49.7 0.71 5.7 -41.3 MEDIA PRIMA 0.17 0.17 3.0% Sell 183 1.11 -3.9 -1.7 na na 0.0 0.0 0.35 -52.2 0.11 50.0 -41.1 STAR 0.31 0.26 -14.8% Sell 221 1.16 -4.1 -1.3 na na 0.0 0.0 0.54 -43.0 0.23 35.6 -37.1 Rubber Gloves 442.6 INSURANCE MEDIA
15. For Internal Circulation Only SNAPSHOT OF STOCKS UNDER COVERAGE Company Share Price Target Price (RM) (RM) LCTITAN 2.28 MHB 0.31 MISC 6.87 PANTECH 0.37 Market Cap. % upside Recom 2.29 0.4% Hold 5,182 0.28 -9.7% Sell 496 9.00 31.0% Buy 30,666 0.29 -21.6% Sell 276 (RMm) Beta EPS (sen) PER (X) FY21 Div Yield (%) FY20 52weeks 52weeks % Chg FY20 FY21 FY20 FY21 High Price % Chg Low Price % Chg YTD 1.34 3.4 10.7 67.4 21.3 0.0 0.4 2.71 -15.9 0.98 133.8 -5.4 1.71 -10.4 0.6 na 54.3 0.0 0.0 0.97 -68.0 0.26 21.6 -64.4 0.68 58.8 49.9 11.7 13.8 4.4 4.4 9.37 -26.7 6.38 7.7 -17.4 1.29 4.8 1.6 7.7 22.5 5.1 1.3 0.52 -28.1 0.25 49.5 -24.5 -15.6 OIL & GAS PCHEM 6.20 5.10 -17.7% Sell 49,600 1.57 14.4 31.3 42.9 19.8 1.1 2.3 7.80 -20.5 4.00 55.0 SERBADK 1.52 2.10 38.2% Buy 5,121 1.50 17.6 20.3 8.7 7.5 3.3 3.3 2.52 -39.7 1.02 49.0 -30.9 UZMA 0.39 0.58 50.6% Sell 13,556 1.67 0.0 3.3 na 11.5 0.0 0.0 1.09 -64.7 0.31 24.2 -60.1 VELESTO 0.11 0.14 27.3% Sell 904 1.93 -0.4 -0.2 na na 0.0 0.0 0.41 -73.2 0.09 22.2 -71.1 FGV 1.15 1.12 -2.6% Sell 4,195 1.44 -0.4 2.3 na 50.6 0.0 0.9 1.59 -27.7 0.72 60.8 -24.3 IJMPLNT 1.83 1.68 -8.2% Sell 1,611 1.38 4.0 6.5 46.3 28.3 1.6 2.2 2.48 -26.2 1.01 81.2 -22.5 IOICORP 4.45 4.02 -9.7% Sell 27,884 0.97 12.6 15.5 35.2 28.8 1.8 2.8 4.82 -7.7 3.41 30.5 -3.5 KLK 22.76 24.01 5.5% Hold 24,546 0.98 72.3 97.1 31.5 23.4 1.8 2.2 25.40 -10.4 17.40 30.8 -8.2 SIMEPLT 5.12 5.59 9.2% Buy 35,249 0.91 9.3 19.7 55.1 26.0 1.6 2.5 5.63 -9.1 3.82 34.0 -6.1 TSH 1.02 1.31 28.4% Buy 1,408 1.54 4.9 6.0 21.0 17.1 2.0 2.0 1.59 -35.8 0.56 82.1 -33.8 UMCCA 4.76 4.83 1.5% Sell 999 0.71 -11.9 11.8 na 40.3 1.7 1.7 5.45 -12.7 4.00 19.0 -11.0 GLOMAC 0.30 0.36 22.0% Buy 227 0.62 3.2 2.5 9.2 11.7 3.4 3.4 0.38 -22.4 0.24 22.9 -19.2 HUAYANG 0.23 0.27 20.0% Buy 79 1.08 -20.6 -2.2 na na 0.0 0.0 0.41 -44.4 0.15 55.2 -37.5 IBRACO 0.50 0.58 16.0% Sell 248 0.73 5.9 8.8 8.4 5.7 1.5 3.0 0.72 -30.6 0.23 117.4 -28.1 IOIPG 0.88 1.06 21.1% Buy 4,818 0.83 11.2 9.9 7.8 8.8 1.7 3.4 1.28 -31.6 0.83 6.1 -29.4 MAHSING 0.98 1.28 30.6% Buy 2,379 1.46 2.4 9.2 40.9 10.7 1.3 3.1 1.47 -33.3 0.31 221.3 39.0 SIMEPROP 0.58 0.65 13.0% Sell 3,910 1.28 1.1 4.3 50.3 13.5 0.9 2.6 0.94 -38.8 0.48 21.1 -37.2 SPSETIA 0.72 1.06 48.3% Buy 2,901 1.55 4.3 10.1 16.7 7.0 0.7 3.5 1.63 -56.1 0.55 30.0 -55.3 SUNWAY 1.28 1.58 23.4% Buy 6,258 0.86 7.1 10.5 18.1 12.2 3.5 5.9 1.79 -28.7 1.20 6.7 -25.9 PLANTATIONS PROPERTY Note: SUNWAY proposed 1 for 5 rights issue ICPS, at an issue price of RM1.00 per rights share. For more detail please refer to 28-May-20 report. REIT CMMT 0.60 0.68 13.3% Hold 1,237 0.58 2.7 4.6 22.1 13.1 4.8 7.7 1.10 -45.5 0.60 0.8 -40.0 SUNREIT 1.36 1.61 18.4% Hold 4,658 0.56 7.8 8.1 17.5 16.8 5.4 5.5 1.92 -29.2 1.34 1.5 -25.3 POWER & UTILITIES MALAKOF 0.91 1.11 22.7% Buy 4,423 0.84 7.5 7.7 12.0 11.8 7.3 7.6 1.02 -11.3 0.65 40.3 4.0 PETDAG 18.22 17.20 -5.6% Sell 18,101 0.70 29.4 74.6 62.0 24.4 1.4 3.2 26.41 -31.0 17.08 6.7 -20.5 PETGAS 16.18 18.80 16.2% Buy 32,016 0.75 97.1 97.2 16.7 16.6 7.3 4.2 18.45 -12.3 12.97 24.7 0.9 TENAGA 10.30 11.40 10.7% Hold 58,758 0.92 75.6 85.8 13.6 12.0 4.0 4.6 13.43 -23.3 9.50 8.4 -19.0 YTLPOWR 0.65 0.62 -3.9% Sell 5,260 1.01 0.9 2.4 70.9 26.6 0.0 0.0 0.80 -18.9 0.45 42.8 -11.0 TELECOMMUNICATIONS AXIATA 3.20 4.50 40.6% Buy 29,342 0.92 6.8 10.8 47.3 29.5 1.8 2.9 4.75 -32.7 2.66 20.3 -22.6 DIGI 4.00 4.50 12.5% Buy 31,100 0.78 16.7 17.9 23.9 22.3 4.0 4.3 4.74 -15.6 3.74 7.0 -10.3 MAXIS 5.15 5.20 1.0% Hold 40,289 0.71 18.9 21.4 27.3 24.1 3.5 3.9 5.70 -9.6 4.59 12.2 -3.2 TM 4.20 4.35 3.6% Hold 15,849 0.87 25.8 27.6 16.3 15.2 3.1 3.3 4.58 -8.3 3.09 35.9 9.9 ELSOFT 0.63 0.70 12.0% Under Review 419 1.36 2.4 4.1 25.8 15.1 2.9 5.0 0.98 -36.2 0.39 62.3 -24.7 INARI 2.68 2.40 -10.4% Under Review 8,790 1.18 4.7 7.0 57.2 38.3 1.6 2.1 2.77 -3.2 0.90 197.8 57.6 MPI 23.78 20.90 -12.1% Under Review 4,730 0.71 76.9 93.5 30.9 25.4 1.1 1.2 24.98 -4.8 7.39 221.8 107.9 TECHNOLOGY Semiconductor & Electronics N2N 0.72 1.15 60.8% Buy 427 1.53 3.6 4.1 19.7 17.4 4.2 4.2 1.00 -28.1 0.34 108.3 2.0 SKPRES 1.89 2.30 21.7% Buy 1,688 1.15 6.1 9.6 31.2 19.6 1.6 2.5 1.94 -2.6 0.66 186.4 39.0 UNISEM 6.09 6.88 13.0% Buy 4,428 0.81 17.4 27.8 35.0 21.9 1.5 2.3 6.25 -2.6 1.53 298.0 181.9 TRANSPORTATION Airlines AIRASIA 0.56 0.70 26.1% Under Review 1,855 1.62 -60.7 8.8 na 6.3 0.0 0.0 1.95 -71.5 0.50 11.0 -67.4 AIRPORT 4.52 7.05 56.0% Buy 7,500 1.03 -28.4 10.9 na 41.5 0.0 2.2 8.57 -47.3 3.92 15.3 -40.5 11.7 Freight & Tankers PTRANS 0.26 0.35 34.6% Buy 495 1.03 2.1 2.6 12.4 10.1 3.8 4.0 0.33 -20.5 0.12 109.9 TNLOGIS 0.52 0.55 6.8% Buy 230 0.73 -0.1 0.7 na 75.4 0.0 0.0 0.61 -15.6 0.26 98.1 2.0 WPRTS 3.94 3.82 -3.0% Sell 13,435 0.53 15.5 15.3 25.4 25.7 2.3 2.9 4.54 -13.2 2.97 32.7 -6.4 SNAPSHOT OF FOREIGN STOCKS UNDER COVERAGE Company Share Price Target Price (S$) (S$) % upside Recom Market Cap. (S$m) Beta EPS (cent) FY20 FY21 PER (X) FY20 FY21 Div Yield (%) FY20 52week 52week % Chg FY21 High Price % Chg Low Price % Chg YTD BANKS & FINANCIAL SERVICES DBS 22.49 26.60 18.3% Buy 57,154 1.16 188.5 217.3 11.9 10.3 3.3 4.4 26.80 -16.1 16.65 35.1 -13.1 OCBC 8.93 9.10 1.9% Sell 39,941 1.02 74.9 87.7 11.9 10.2 3.6 4.0 11.23 -20.5 7.80 14.5 -18.7 UOB 20.45 23.80 16.4% Buy 34,209 1.11 178.6 218.8 11.5 9.3 3.9 4.9 26.77 -23.6 17.12 19.4 -21.8 4.33 5.82 34.4% Buy 27,706 0.89 22.6 23.5 22.1 22.1 4.6 3.2 4.95 -12.5 2.83 53.0 5.1 PLANTATIONS WILMAR 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.
16. Technical View Monday , November 09, 2020 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Weekly Technical Outlook FBM KLCI: 1,519.64 (+52.75, +3.60%) Chartist: Stephen Soo Tel: +603-2167 9607 stsoo@ta.com.my www.taonline.com.my Budget 2021 to Boost Recovery Optimism The local blue-chip benchmark FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI) rallied last Friday to close at a fresh three-week high, thanks to strength in key plantation, oil & gas, financials, utility and consumer blue chips as optimism over economic recovery grew given the Budget 2021 proposals which introduced additional stimulus measures to overcome the adverse impact from the resurgent local COVID-19 transmissions. Week-on-week, the FBM KLCI surged 52.75 points, or 3.6 percent to 1,519.64, with Kuala Lumpur Kepong (+RM1.54), Petronas Dagangan (+98sen), Hong Leong Finance Group (+79sen), Tenaga (+76sen) and Nestle (+70sen) representing most of the gains. Average daily traded volume and value last week rose to 6.85 billion shares worth RM3.7 billion, compared to the 5.27 billion shares and RM4.04 billion average the previous week, fueled by resurgent buying momentum in small caps, ACE Market and penny stocks which again attracted strong retail participation. Profit-taking activities persisted on Monday, as Bursa Malaysia shares fell amid worries over spiking Covid-19 cases worldwide depressing global economic growth, caution ahead of Bank Negara’s final monetary policy meeting for the year and the closely watched US presidential elections. The FBM KLCI ended flat at 1,466.46 (-0.43), after oscillating between low of 1,452.13 and high of 1,468.09, as losers beat gainers 688 to 365 on total turnover of 5.94bn shares worth RM3.28bn. Blue chips eased on Tuesday, with banks leading falls amid worries ahead of Bank Negara’s monetary policy meeting, but they recouped some losses after interest rates were left unchanged, while the broader market was mixed on caution over the high local COVID-19 infection rate. The FBM KLCI shed 5.01 points to close at 1,461.45, off an early high of 1,470.69 and low of 1,460.60, but gainers led losers 669 to 384 on higher turnover of 6.45bn shares worth RM3.3bn. Bursa Malaysia blue chips closed off best Wednesday as late profit-taking checked early gains, while small caps and ACE Market stocks attracted strong retail participation following the revival of rotational plays into healthcare and technology related stocks. The FBM KLCI ended up 3.16 points at 1,464.61, after moving between early low of 1,462.37 and high of 1,473.53, as gainers led losers 702 to 377 on improved turnover totaling 7.3bn shares worth RM3.36bn. The local stock market rallied strongly into the close Thursday, fueled by strong rallies in the region as Democrat candidate Joe Biden looks increasingly certain to win the US presidential contest, improving economic recovery hopes amid lessening global trade tensions. The construction, technology, small cap and ACE Market sector indices rallied 4 to 5 percent to outperform other sectors on economic growth optimism. The FBM KLCI surged 36.88 points, or 2.5 percent, to end at the day’s high of 1,501.49, off an opening low of 1,467.84, as gainers swarmed losers 1,096 to 204 on robust turnover totaling 6.92bn shares worth RM3.89bn. Page 1 of 4
17. 9-Nov-20 Local stocks extended gains ahead of the weekend , on optimism Budget 2021 proposals will contain more stimulus measures to mitigate the adverse COVID-19 resurgence impact on economic growth next year. The index climbed another 18.15 points, or 1.2 percent to end at Friday’s high of 1,519.64, off an early low of 1,497.32, as gainers edged losers 624 to 469 on strong traded volume totaling 7.67bn shares worth RM4.67bn. Trading range for the blue-chip benchmark index last week expanded again to 67.51 points, compared to the 44.6-point range the previous week, as the index climbed up to end at a three-week high. For the week, the FBM-EMAS Index gained 405.39 points, or 3.82 percent to 11,018.97, while the FBM-Small Cap Index rallied 909.46 points, or 7.05 percent to 13,806.10. Given last week’s strong rebound, the daily slow stochastics indicator on the FBM KLCI has turned higher after issuing a buy early week, while the weekly indicator just issued a buy signal due to last Friday’s strong closing. Meanwhile, the 14-day and 14-week Relative Strength Index (RSI) indicators also turned upwards to boost their bullish momentum readings. Chart 1 Page 2 of 4
18. 9-Nov-20 On trend indicators , the daily Moving Average Convergence Divergence (MACD) issued a fresh buy signal, while the weekly MACD indicator’s signal line hooked back up towards the mid-point to lessen its bearish stance. On the 14-day Directional Movement Index (DMI) trend indicator, the +DI and -DI lines crossed over to trigger a buy signal, but the ADX line has yet to turn upwards to confirm an uptrend. Chart 2 Conclusion With multiple buy signals triggered on momentum and trend indicators due to last week’s strong sessions, the FBM KLCI should enjoy further upside room this week, as optimism over economic growth increase with the Budget 2021 proposals likely to enhance recovery potential. On the external front, markets are rallying on hopes Democrat candidate Joe Biden will eventually become the new US president, fueling global recovery optimism as he should prove less combative and more accommodative towards China and other major economies, and hence reduce global trade frictions. Given the strong close last Friday, immediate upside hurdles for the index are again revised upwards to the 100-day moving average at 1,534, with subsequent hurdles at 1,550 and 1,580. Immediate support is also revised higher to the 30-day and 200-day moving averages at 1,503 and 1,490, respectively, followed by the rising 10-day moving average at 1,486. Meanwhile, technology related stocks such as Globetronics, Inari Amerton, Malaysia Pacific Industries, SKP Resources, Unisem and VS Industry should stage profit-taking corrections following their recent rally, while construction and property related counters like Gamuda and Sime Darby should be able to attract bargain hunters looking for rotation into economic recovery play. Page 3 of 4
19. 9-Nov-20 Chart 3 Disclaimer The information in this report has been obtained from sources believed to be reliable . Its accuracy and/ 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. As o, the chartist, Stephen Soo, who prepared this report, has interest in the following securities covered in this report: (a) nil Kaladher Govindan – Head of Research TA SECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048 www.ta.com.my Page 4 of 4
20. MARKET STRATEGY Friday , November 06, 2020 FBMKLCI: 1,519.64 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Budget 2021 Review Comprehensive Budget to Revitalise the Economy Kaladher Govindan Tel: +603-2167 9609 kaladher@ta.com.my www.taonline.com.my Executive Summary Budget 2021 lived up to our expectations. It contained sufficient measures to revitalize the economy and alleviate rakyat’s burden, imposed by the negative effects of Covid-19 that trickled down to harm every aspect of daily work and life. We expect this budget to get the final endorsement when tabled for approval on 23rd November after going through many rounds of policy debates and ministerial replies as the current economic reality should sink in and present ample opportunity in finding a common ground among the members of parliament. As such, reiterate our “ Buy-on-Weakness” view to ride on a market rally next year underpinned by 1) strong liquidity driven by positive policy measures globally to reboot the economy, 2) clearer political landscape, both locally and in the US, after the dust settles on majority support, 3) brighter chances for an effective Covid-19 vaccines, potentially by end 1Q21, and 4) less combative foreign policy among key trading nations, especially if Joe Biden wins the US Presidential elections. Government’s official GDP forecast of 6.5%to 7.5% in 2021 appears realistic with multi-billion allocations for development expenditure going into high impact projects and more incentives going into reviving consumption. It is considered within our in-house GDP projection of 6.4%. A total gross expenditure of RM322.5bn is budgeted for 2021, including the RM17bn allocation for Covid-19 fund, which is 2.5% higher than the 2020 allocation. This comprises RM236.5bn or 73.3% of total expenditure for operating expenditure (+4.3% YoY due to increase in debt service charges, higher payment for supplies and services, and emoluments). Gross development expenditure increased by 38% YoY to RM69bn as allocation for all components increased between 36.3% and 40.7% with the economic sector getting the highest allocation of RM38.9bn, social sector RM18.4b, security M7.8bn and general administration RM4bn. Total revenue of RM236.9bn (+4.2% YoY) consists of RM174.4bn in tax revenue (+13.8% YoY) and RM62.5bn in non-tax revenue (-15.5% YoY). Since the spending exceeds revenue by RM84.8bn, including the RM800mn from loan recovery and RM17bn allocated for Covid-19 fund, the fiscal deficit of 5.4% (-6.0% in 2020), which is in-line with our forecast 5.5%, will be funded by borrowings and assets sale. We are Neutral on Budget 2021 impact on the equity market. Maintain our end-2020 and 2021 FBMKLCI target of 1,550 and 1,720 based on CY21 and CY22 PER of 15.5x and 17x respectively. Consumer staple is one of the biggest direct beneficiaries from various budget measures. Likely beneficiaries are F&N (Buy, TP: RM40.00), AEON (Buy, TP: RM1.25), Hup Seng (Hold, TP: RM1.00), Johore Tin (Buy, TP: RM2.10), Leong Hup (Buy, TP: RM0.91), Nestle (Hold, TP: RM143.00) and QL Resources (Hold, TP: RM7.00). No hike in tax is positive for brewers like Carlsberg (Buy, TP: RM24.50) and Heineken (Buy, TP: RM26.00). The absence of windfall tax is positive for glove players although the big four committed to RM400mn in donations. Telcos like Axiata (Buy, TP: RM4.50), Digi (Buy, TP: RM4.50), Maxis (Hold, TP: RM5.20) and TM (Hold, TP: RM4.35) will benefit from JENDELA, multibillion allocation for broadband and Jaringan Prihatin Programme. Measures for the Construction and Property sectors largely within expectations. Page 1 of 42
21. 06-Nov20 Budget 2021 – Key Highlights Budget 2021 themed as “Resilient as One, Together We Triumph” focuses on three integral goals, i) Rakyat’s Wellbeing, ii) Business Continuity and iii) Economic Resilience. It is the fifth phase in government’s phased economic recovery plan known as 6R approach, which includes Resolve, Resilience, Restart, Recovery, Revitalise and Reform. The 12th Malaysia Plan that will be revealed next January will focus on the last 6R stage, which is Reform. Key highlights of the budget are, 1) RM17bn allocation to Covid-19 Fund in 2021versus RM38bn in 2020. 2) The tax relief limit on medical expenses for self, spouse and child for serious diseases increased from RM6,000 to RM8,000 ringgit and tax relief limit for expenses on full medical check-up from RM500 to RM1,000 ringgit. 3) Bantuan Sara Hidup will be replaced with the Bantuan Prihatin Rakyat with higher rates of assistance. 4) The Government will allocate RM1.5bn ringgit to implement the Jaringan PRIHATIN Programme to alleviate the financial burden of the B40 group in accessing internet services. 5) The first initiative is the income tax reduction for resident individuals which will be reduced by 1 percentage point for the chargeable income band of RM50,001 to RM70,000 ringgit 6) The minimum employee EPF contribution rate is reduced from 11 to 9 percent beginning January 2021 for a period of 12 months to increase take-home pay. 7) The facility to withdraw EPF savings from Account 1 on a targeted basis. The amount allowed will be RM500 a month with a total of up to RM6,000 over 12 months. 8) The formation of a National Employment Council which will be chaired by YAB Prime Minister. 9) To further encourage old-age savings through Private Retirement Scheme, individual income tax relief of up to RM3,000 on the PRS contributions will be extended until the year of assessment 2025. 10) The Government will allocate RM500 to implement the National Digital Network initiative, JENDELA to ensure the connectivity of 430 schools throughout Malaysia covering all states. 11) Full stamp duty exemption on instruments of transfer and loan agreement for first time home buyers is extended until 31 December 2025. 12) Stamp duty exemption on loan agreements and instruments of transfer given to rescuing contractors and the original house purchasers is extended for another 5 years. 13) The Government will provide training and placements for 8,000 employees of airline companies in Malaysia with an allocation of RM50m 14) RM15bn will be allocated to fund the Pan Borneo Highway, Gemas-Johor Bahru Electrified Double-Tracking Electrified Project and Klang Valley Double Tracking Project Phase One. 15) The Government will also continue the High-Speed Rail Project or HSR as this project is expected to generate a positive multiplier effect to the country's economy. However, it is subject to further discussion with Singapore. 16) To continue with Rapid Transit Link from Johor Bahru to Woodlands and MRT 3 in the Klang Valley. (Please refer economic and sector reports, and budget details in the following pages) Page 2 of 42
22. 06-Nov20 Budget 2021 – Source and Application of Revenue Figure 1 : Source of Revenue Federal Government Revenue RMmn Change (%) 2018 2019 2020e 2021f 2019 2020e 2021f Tax Revenue 174,061 180,566 153,260 174,370 3.7% -15.1% 13.8% Direct Tax 130,035 134,723 115,105 131,870 3.6% -14.6% 14.6% 55.8% 51.0% 50.6% 55.7% CITA % of Total revenue 66,474 63,751 59,385 64,596 -4.1% -6.8% 8.8% Individual 32,605 38,680 35,906 42,439 18.6% -7.2% 18.2% PITA 20,082 20,783 8,551 13,000 3.5% -58.9% 52.0% 44,026 45,843 38,155 42,500 4.1% -16.8% 11.4% 18.9% 17.3% 16.8% 17.9% Indirect Tax % of Total revenue GST/SST 25,680 27,669 24,533 27,900 7.7% -11.3% 13.7% Excise Duties 10,779 10,511 8,507 8,768 -2.5% -19.1% 3.1% Import Duty 2,897 2,733 2,035 2,050 -5.7% -25.5% 0.7% Export Duty 1,725 1,126 802 922 -34.7% -28.8% 15.0% 58,821 83,849 74,010 62,530 42.5% -11.7% -15.5% 25.3% 31.7% 32.6% 26.4% Total Revenue 232,882 264,415 227,270 236,900 13.5% -14.0% 4.2% Nominal GDP 1,446,914 1,510,693 1,439,374 1,568,104 4.4% -4.7% 8.9% Share of GDP (%) 16.1% 17.5% 15.8% 15.1% Non-Tax Revenue % of Total revenue Source: Ministry of Finance, TA Securities Figure 2: Application of Revenue – Operating Expenditure (OE) RMmn OE Change (%) 2018 2019 2020e 2021f 2019 2020e 2021f Emoluments 79,989 80,534 82,611 84,532 0.7% 2.6% 2.3% Retirement charges 25,177 25,894 27,055 27,583 2.8% 4.5% 2.0% Debt service charges 30,547 32,933 34,945 39,000 7.8% 6.1% 11.6% -0.1% Grants to state government 7,605 7,574 7,749 7,745 -0.4% 2.3% Supplies and services 35,283 31,507 30,101 32,770 -10.7% -4.5% 8.9% Subsidies 27,516 23,901 20,145 18,853 -13.1% -15.7% -6.4% 447 770 650 542 72.2% -15.6% -16.6% -48.2% Asset Acquisition Refunds & Write-offs Grant to statutory Bodies Other Expenditure 883 893 987 511 1.1% 10.5% 13,763 13,780 14,040 15,430 0.1% 1.9% 9.9% 9,750 45,557 8,437 9,574 367.3% -81.5% 13.5% 38,000 17,000 230,960 263,343 226,720 236,540 14.0% -13.9% 4.3% 80.5% 82.9% 72.0% 73.3% Covid-19 Fund Total Operating Expenditure % of Total Expenditure Figure 3: Application of Revenue – Development Expenditure (DE) and Overall Deficit Source: Ministry of Finance, TA Securities Page 3 of 42
23. 06-Nov20 Budget Impact on Stocks and FBMKLCI Budget 2021 came largely within our expectations . It addressed the three pertinent goals highlighted earlier and spelled out precise measures and allocations to achieve those objectives. In ensuring the Rakyat’s wellbeing it covered a variety of subjects that include allocations to fight Covid-19 pandemic and tax relief for not only for a few types of vaccinations expenses but also higher tax relief for various existing medical treatment categories that should benefit the healthcare players under our coverage like IHH (Hold, TP: RM6.00), KPJ (Buy, TP: RM0.95) and DuoPharma (Sell, TP: RM1.97). Insurance player like Allianz (Buy, TP: RM17.08) will benefit from green light to purchase life insurance products via EPF Account 2.The RM8.7bn financial assistance for vulnerable groups, the potential injection of RM9.3bn into system with a 2 percentage points reduction in EPF contribution and RM500 monthly withdrawal over a period of 12 months from EPF Account 1 are positive for Consumer Staples like F&N (Buy, TP: RM40.00), Nestle (Sell, TP: RM143.00), QL Resources (Hold, TP: RM7.00). The RM500mn ringgit to implement the National Digital Network Initiative and RM7.4bn allocation for 2021 and 2022 to build and upgrade broadband services are positive for telcos like Axiata (Buy, TP: RM4.50), Digi (Buy, TP: RM4.50), Maxis (Hold, TP: RM5.20) and TM (Hold, TP: RM4.35). The absence of windfall tax is a pleasant surprise for glove players and the combined RM400mn donations from Top Glove (Buy, TP: RM10.80), Hartalega (Buy, TP: RM25.97), Supermax (Buy, TP: RM12.33) and Kossan (Buy, TP: RM10.30) to fight Covid19 is negligible for these players that raked in huge profits from high demand for gloves. Construction players should benefit from various urban and rural development projects involving infrastructure, road maintenance, sports facilities, hospitals, flood mitigation projects, etc. However, much of it, including new mega projects to be implemented like MRT3 and JB-Singapore Rapid Transit System are within our expectations. Thus, there is no change in our Underweight call on the sector. The same applies to measures announced for the Property sector that came largely within expectations. (Please read the review by sectors for more details) Page 4 of 42
24. 06-Nov20 Figure 4 : Some Projects Earmarked Under Development Expenditure No. Section Item description Amount (mn) Sector 104 Community Centers as transit centres for children to 20 Community attend after school 2,700 Rural development 2 105 RM1.3bn to implement rural and inter-village road projects spanning 920km; RM632mn allocated for rural and alternative water supply; RM250mn provided for rural electricity supply; RM55mn for the Home Assistance Programme to the poor; and 121 million ringgit to install 27 thousand units of lamps as well as to cover operational and maintenance costs of 500k units of street lights in villages 1 3 116 Implementation of the National Digital Network initiative, JENDELA to ensure the connectivity of 430 schools throughout Malaysia covering all states Allocation of RM7.4bn for year 2021 and 2022 by MCMC to build and upgrade broadband services Upgrade of buildings and infrastructure in 50 dilapidated schools Implementation of 184 construction projects and install tube well water for schools in rural Sabah and Sarawak Upgrade of the Malaysian Research & Education Network access line to 500Mbps to 10Gbps 500 Telecommunication 4 116 5 121 6 121 7 124 8 132 Provision of comfortable and quality housing, especially for the low-income group 9 142 Construction of 1000 new units of Rumah Keluarga Angkatan Tentera 500 Housing 10 143 Upgrade of facilities at RELA training centre to strengthen the role of RELA. 153 Community 11 156 RM100mn for the maintenance of ithe infrastructure of industrial parks; RM42mn under JENDELA to improve internet connectivity in 25 industrial parks; Development of a water treatment plant in Kubang Pasu district; and allocation of RM45mn to meet the water supply needs in the Gebeng Industrial Zone. 187 Infrastructure 12 198 Allocation of RM2.5bn for contractors in Class G1 to G4 to carry out small and medium projects across the country including additional RM200 for maintenance projects for Federal Roads and 50 million for PPR houses. 2,500 Infrastructure 13 205 Implementation of transport infrastructure projects to increase the mobility of rakyat. In 2021, RM15bn will be allocated to fund the Pan Borneo Highway, Gemas-Johor Bahru Electrified Double-Tracking Electrified Project and Klang Valley Double Tracking Project Phase One. In addition, several key projects will also be continued such as Rapid Transit System Link from Johor Bahru to Woodlands, Singapore and MRT3 in Klang Valley. 15,000 Infrastructure 14 206 Continuation of KL-Singapore High Speed Rail, subject to further discussion with Singapore 15 207 3,800 Infrastructure 16 208 Construction of the Second Phase of the Klang Third Bridge in Selangor; Continuing the Central Spine Project with the new alignment from Kelantan to Pahang; Upgrading the bridge across Sungai Marang, Terengganu; Upgrading of Federal Road connecting Gerik, Perak to Kulim, Kedah; To continue building and upgrading Phase of the Pulau Indah, Klang Ringroad Phase 3, Selangor; Construction of the Pan Borneo Highway Sabah from Serusop to Pituru; and Construction of the Cameron Highlands Bypass road, Pahang Rapid Transit Bus Transport System at 3 High Capacity Routes and construction of busway at IRDA in Johor; Construction of the Palekbang Bridge to Kota Bahru, Kelantan under ECER; Construction of infrastructure and related components of the Special Development Zone project in Yan and Baling, Kedah under NCER; Infrastructure Project in the Samalaju Industrial Area, Sarawak under SCORE; and Continuation of the Sapangar Bay Container Port Expansion Project, Sabah under SDC. 17 210 150 Infrastructure 18 212 Raw Water Transfer Project from Sungai Kesang and Tasik Biru to the Jus Reservoir, Jasin , Melaka. For 2021, Sabah and Sarawak will receive Development Expenditure allocation of RM5.1bn and RM4.5bn respectively. These allocation among others are for building and upgrading water, electricity, and road infrastructure, health and education facilities 7,400 Telecommunication 725 Community 120 Rural development 50 Telecommunication 1,200 Housing na Infrastructure 780 Infrastructure 9,600 Infrastructure Page 5 of 42
25. 06-Nov20 As for the FBMKLCI , it has come under consistent selling pressure since last October due to worries about the outcome of US elections and rumbling in domestic politics, where some viewed the impending parliamentary proceedings to table and approve Budget 2021 will be used to display political support and destabilise the current government. The index dipped from a high of 1532.53 in October to a low of 1,452.13 on 2nd November before rebounding strongly to close at 1,519.64 on Budget day. The rebound was mainly driven by high expectations for Joseph Biden’s victory in the US presidential election as he is widely seen to be less combative on trade policy and in relations with the region's growth engine China, and investors hope that may clear the way for Asia's stronger recovery from the coronavirus crisis. With the outcome of US elections hanging in balance after President Trump contested the results in certain states and filed lawsuits, we may see some profit taking pressure ahead as investors choose to liquidate some of their gains next week. This is not surprising and is perfectly in sync with the historical trends. Post 1997 Asian Financial Crisis data showed probability for corrections in the two-week period post-budget is high at 60.9% with an average total return of -1.1% and greater average losses of 3.0%. From a total average return perspective, the FBM KLCI tends to underperform during the first two months of post-budget announcement before bouncing back for a year-end window dressing or New Year rally. This trend should persist as investors wait for the outcome of US elections and the 23 November voting day to pass the Budget 2021, while more cases of Covid-19 as winter approaches affect market sentiment in the interim period. We maintain our end-2020 FBMKLCI target at 1,550 based on CY21 PER of 15.5x and EPS of 100.1 sen. In comparison, FBMKLCI’s current valuation of 16.1x CY21 PER based on consensus EPS of 94.59 sen is at 2.3% premium to regional average of 15.7x (vs. Thailand, Jakarta and Philippines). The premium valuation should dwindle as we progress into later part of 2021 as the economic and corporate earnings growth gain traction and consensus earnings are revised upward. With foreign shareholding in Malaysian equities trending below 21% level currently, there is high probability for them to return in a big way in later part of 2021. Figure 5 : FBMKLCI's Historical Performance - Pre and Post Budget FBMKLCI Historical Performance - Pre and Post Budget Before 3 Month After BUDGET 2 Month 1 Month 2 Weeks 2 Weeks 1 Month 2 Month 3 Month 2021 (06-Nov-20) -3.7% 0.2% 2.0% 1.7% -6.7% -3.6% -2.8% -1.7% 2020 (11-Oct-19) 0.8% 3.4% 0.3% 2.2% -3.7% -5.5% -4.6% -1.1% 2019 (02-Nov-18) -0.4% -2.0% -1.4% -1.8% -1.2% -1.3% -0.7% -0.5% 2018 (27-Oct-17) -0.2% -1.7% 0.8% 6.2% 0.8% -1.2% 0.0% 0.3% 2017 (21-Oct-16) -1.3% -2.8% -2.1% -0.3% -0.6% 11.7% 6.1% 0.3% 2016 (23-Oct-15) -1.5% -2.9% -4.0% -5.0% -3.9% -2.2% -3.1% -1.7% 2015 (10-Oct-14) 0.6% 0.8% -3.9% -4.2% 1.7% 5.5% 2.4% 2.3% 2014 (25-Oct-13) -0.7% -1.3% 1.0% -0.8% 2.3% 0.7% -0.5% 1.4% 2013 (28-Sep-12) 1.5% 2.2% -2.4% 2.3% -12.2% -6.5% -4.7% 2.5% 2012 (07-Oct-11) 2.8% 5.5% 5.8% 8.1% 11.5% 8.7% 1.1% 1.6% 2011 (15-Oct-10) 1.1% 0.7% 1.4% 5.4% 9.6% 7.9% 4.0% 2.7% 2010 (23-Oct-09) -0.5% 0.6% -0.5% 2.6% -13.8% -7.3% -5.1% 0.5% 2009 (29-Aug-08) -5.1% -7.3% -24.4% -21.3% -3.5% -5.0% -0.2% 2.5% 2008 (07-Sep-07) 0.1% 5.2% 6.5% 10.4% 3.2% 5.0% 2.8% 2.0% 2007 (01-Sep-06) -0.2% 0.7% 2.9% 12.5% 3.7% 3.2% -1.1% -0.4% 1.5% 3.5% 0.6% 3.5% 2006 (30-Sep-05) 2005 (10-Sep-04) -0.2% 0.6% -2.3% 1.3% -3.1% 3.1% -2.9% 5.3% 7.4% 2.4% 2.3% -0.3% 2004 (12-Sep-03) 0.2% 6.7% 7.3% 7.1% -9.5% -7.4% -8.0% -3.1% 2003 (20-Sep-02) -4.2% -3.0% -5.2% -5.3% -5.2% -6.0% -2.3% 1.0% 2002 (19-Oct-01) -3.0% 3.3% 8.0% 13.6% -1.0% -0.7% 9.7% 5.5% 2001 (27-Oct-00) -4.9% -9.8% -14.1% -9.6% -3.4% -3.2% 10.0% 3.0% 2000 (29-Oct-99) -2.9% 0.4% 7.4% 25.9% 0.3% -20.6% 32.3% -9.7% 8.3% 1.0% 12.8% -0.3% 1999 (23-Oct-98) 1998 (17-Oct-97) 8.0% -16.4% 10.0% -16.0% 28.0% -31.5% 47.4% -32.1% 41.7% 37.5% 58.3% 70.8% Gain Frequency 39.1% 56.5% 52.2% 56.5% 58.3% 62.5% 41.7% 29.2% Loss Frequency 60.9% 43.5% 47.8% 43.5% 4.4% 8.3% 3.9% 2.6% Average Gain 1.7% 3.1% 6.0% 11.5% -6.4% -1.9% -4.1% 0.6% -3.2% 1.0% -1.2% 1.5% Average Loss Total Average Return -3.0% -1.1% -4.9% -0.4% -8.4% -0.9% -8.3% 2.9% Source: , TA Securities Page 6 of 42
26. 06-Nov20 Figure 6 : FBMKLCI Performance, Price Ratio and Earnings Growth Comparison ROE (%) ROA (%) Price/ Book (X) EPS Growth (%) Div.Yield (%) PER (X) CY19 CY20 CY21 CY19 CY20 CY21 CY19 CY20 CY21 CY19 CY20 CY21 CY19 CY20 CY21 CY19 CY20 CY21 Malaysia 9.4 8.1 8.4 1.48 1.27 1.34 1.5 1.5 1.4 -5.1 -10.4 10.4 3.6 3.4 3.6 15.9 17.7 16.1 Thailand 9.5 5.0 7.0 2.56 1.22 1.64 1.4 1.4 1.4 -12.7 -41.5 44.7 3.9 2.6 3.1 13.5 23.0 15.9 Indonesia 14.4 11.6 14.3 2.75 2.36 3.01 1.8 1.9 1.7 1.8 -29.6 44.5 2.6 2.3 2.2 13.9 19.8 13.7 Philippines 11.5 6.4 8.9 2.65 2.29 3.09 1.5 1.6 1.5 9.9 -40.4 37.7 1.9 1.7 1.6 14.4 24.1 17.5 Singapore 9.6 6.5 8.3 1.59 1.35 1.75 0.9 0.9 0.9 0.1 -39.3 35.4 5.2 3.8 4.5 10.5 17.4 12.8 Source: TA Securities Figure 7: Budget Impact by Sector Sector AUTOMOTIVE Impact of Budget Neutral Rationale There are no significant measures that would affect Automotive companies under our coverage. As communicated earlier, targeted financial assistance could help sustain asset quality. Additional guarantees by BANKING Neutral BUILDING MATERIALS Neutral CONSTRUCTION Neutral government agencies could help spur some lending activities, although the impact will not be significant to the system’s loan growth. Similarly, we do not foresee the Rent-to-Own Scheme, involving 5,000 PR1MA houses to move the needle on mortgages. Demand of building materials will be supported by on-going mega infrastructure projects. No major surprise with mega infrastructure projects to be rolled out, i.e. MRT3 and JB-Singapore RTS, together with the intention to implement KL-Singapore High Speed Rail are within expectations. Aids and measures offered towards low-income group and implementation of business-friendly policy would likely benefit F&B players and retailers with large domestic exposure, resulted from follow-through demands, CONSUMER Positive GAMING Neutral HEALTHCARE Positive INSURANCE Positive MEDIA Neutral There are no significant measures that would affect media companies under our coverage. OIL & GAS Neutral There are no significant measures that would affect O&G companies under our coverage. PLANTATIONS Neutral There are no significant measures that would affect Plantation companies under our coverage. POWER & UTILITIES Neutral There are no significant measures that would affect Power & Uttilities companies under our coverage. PROPERTY Neutral .Separately, BAT is set to benefit from the regulation over vape and the more holistic measures to combat trade of illicit cigarettes. There are no significant measures that would affect gaming companies under our coverage. Positive due to no windfall tax. The RM400mn contribution by the big 4 to the Covid-19 fund only accounts for 3.47%-4.3% of 2020 earnings, which is minimal in our view. Some of the measures such as allowing the EPF members to purchase life insurance products via withdrawal from Account 2 will help to drive the sales for life insurers. Low-to-middle income earners and first time buyer to benefit from stamp duty exemption and RTO financing. No incentives to private developers as expected. We expect the allocation of RM7.4bn by MCMC for expanding broadband services to bode well for telcos as it TELECOMMUNICATIONS Positive would enhance the commercial viability of expanding especially into underserved sub-urban and rural areas. Meanwhile, we also expect the government's provision of telecommunication credits worth RM180 to B40 group to help keep telcos ARPU resilient. While investment and tax incentives for clusters including electronics is positive, for companies under our TECHNOLOGY Neutral coverage, we do not expect any significant impact on top of the existing benefits that they will continue to enjoy in the coming years. TRANSPORTATION Neutral There are no significant measures that would affect transportation companies under our coverage. Page 7 of 42
27. 06-Nov20 Figure 8 : Budget Impact on Stocks Company Last Price (RM) Target Price Upside (RM) (%) Call Budget Rationale Impact Domestic based operations with majority retail revenue derived from food-line items, most AEON 0.70 1.25 78.6 Buy Positive HUAYANG 0.23 0.27 20.0 Buy Positive Beneficiary of Stamp Duty Exemptions for property priced below RM500k/unit GLOMAC 0.30 0.36 22.0 Buy Positive Beneficiary of Stamp Duty Exemptions for property priced below RM500k/unit GAMUDA 3.69 3.50 (5.1) Sell Positive IJM SUNCON 1.45 1.48 2.1 Sell Positive likely to benefit from improving disposal income MMC-GAMUDA JV likely to be appointed as PDP for above ground section and contractor for underground works. Potential beneficiary of JB-Singapore RTS and KL-Singapore High Speed Rail Potential beneficiary of MRT3, JB-Singapore RTS, KL-Singapore High Speed Rail and Kwasa Damansara development Potential beneficiary of MRT3, JB-Singapore RTS, KL-Singapore High Speed Rail and Kwasa 1.82 1.84 1.1 Sell Positive WCT 0.395 0.34 (15.2) Sell Positive GDB 0.69 0.95 37.7 Buy Positive Potential beneficiary of Kwasa Damansara development GADANG 0.395 0.29 (26.6) Sell Positive Potential beneficiary of MRT3, KL-Singapore High Speed Rail and Kwasa Damansara development PESONA 0.255 0.235 (7.8) Sell Positive Potential beneficiary of Kwasa Damansara development 0.30 0.53 76.7 Buy Positive Potential beneficiary of Kwasa Damansara development ALLIANZ 13.16 17.08 29.8 Buy Positive AMWAY 5.10 6.00 17.6 Buy Positive Domestic based operations, most likely to benefit from improving disposal income PADINI 2.04 2.90 42.2 Buy Positive Domestic based operations, most likely to benefit from improving disposal income FOCUSP 0.61 0.76 24.6 Buy Positive Domestic based operations, most likely to benefit from improving disposal income HUPSENG 0.92 1.00 8.7 Hold Positive 140.10 143.00 2.1 Sell Positive INTA NESTLE BAT TM 10.22 4.20 14.50 4.35 41.9 3.6 Buy Hold Positive Positive Damansara development Potential beneficiary of MRT3, JB-Singapore RTS, KL-Singapore High Speed Rail and Kwasa Damansara development Potential beneficiary from some of the budget measures such as allowing the EPF members to purchase life insurance products via withdrawal from Account 2. Being a manufacturer of staples products, it is likely to ride on improvement of consumer disposal income. Being a manufacturer of staples products, it is likely to ride on improvement of consumer disposal income. Beneficiary of regulation over vape and the more holistic measures to combat trade of illicit cigarettes. Potential beneficiary if selected to play a key role in development owing to its past experience in rolling out HSBB and SUBB. Source: Budget 2020 Speech, TA Securities [ TH E RE M A ININ G OF T H IS P A GE IS IN TE N TI O NA L L Y L E F T BL AN K] Page 8 of 42
28. 06-Nov20 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY * Malaysian Economy Economic Report 2020/2021 Shazma Juliana Abu Bakar Tel: +603-2167 9608 shazma@ta.com.my farid@ta.com.my www.taonline.com.my Summary On 6 November 2020, Finance Minister Tengku Zafrul Aziz presented the 2021 Budget, a first for the Perikatan Nasional government since taking over Putrajaya in March this year. Among the key highlights in the Economic Report 2020/21: Malaysia’s real GDP is expected to grow between 6.5% and 7.5% in 2021, after a 4.5% contraction in 2020 due to the Covid-19 pandemic. The strong rebound will be driven by the anticipated improvement in global growth and international trade. On top of that, the impact of the stimulus packages implemented by the government is anticipated to have spill-over effects and provide an additional boost to the economy in 2021. Gross export earnings are expected to rebound 2.7% in 2021 after a projected 5.2% decline in 2020, helped by the recovery in global trade and supply chains. For 2021, exports of manufactured goods are anticipated to grow 2.5%, supported by improved demand for electrical and electronics (E&E) and non-E&E products. Malaysia's inflation, as measured by the Consumer Price Index (CPI), is projected to normalise at 2.5% in 2021, after the domestic economy slipped into deflation as a result of the Covid-19 outbreak in 2020. The inflation forecast in 2021 is in line with better economic prospects and higher crude oil prices. 2021 Budget would allocate RM322.54bn for all government expenses (or 20.6% of GDP), RM25.5bn more than 2020’s revised allocation of RM314.72bn. Of this total, RM236.5bn or 73.3% will be channelled to Operating Expenditure (OE), RM69bn (21.4%) to Development Expenditure (DE) and RM17bn (5.3%) is for the COVID-19 Fund. 2021 total revenue is envisaged to turn around by 4.2% in 2021 to RM236.9bn versus the lower than expected revenue of RM227.3bn this year. Tax revenue remains as the main contributor with expected total collection of RM174.4bn, an increase of 13.8% than 2020. As a percentage to GDP, tax revenue constitutes 11.1% while non-tax revenue at 4%. 2021 fiscal deficit is expected to be at 5.4% of GDP, almost in line with our expectation of -5.5% of GDP. We find the target is realistic and achievable especially with the current economic scenario and volatile oil prices. Under the Medium-Term Fiscal Framework (MTFF), which provides a macro-fiscal projection over three years, Malaysia’s fiscal deficit is expected to be lower at -4.5% of GDP by 2023. The government is raising more debt to finance a wider fiscal deficit as it is in the driver seat to steer the economy out of recession. The national debt is expected to inch up further to hit 61% of GDP in 2021, up from 60.7% in 2020 and 52.5% in 2019. Figure 1: Key Macroeconomic Projections (2019E vs 2020F) Forecast for 2019 - 2020 Real GDP Growth (%) Fiscal Balance (% of GDP) Consumer Price Index (%) Ministry of Finance 2020E 2021F -4.5% 6.5% - 7.5% -6.0% -5.4% -1.0% 2.5 TA Securities 2020E 2021F -4.5% -6.4% -7.4% -5.5% -0.9% 3.0% Source: Economic Report 2019/2020, TA Securities Page 9 of 42
29. 06-Nov20 2021 Growth Outlook - Transitioning from Crisis to Recovery • Taking into consideration of current environment and rising downside risks to growth, the government predicts that Malaysia’s real GDP to contract by 4.5% in 2020 before rebounding in a range of 6.5% to 7.5% next year. This is in line with the proactive measures undertaken by the Government through the economic stimulus packages, the Budget 2021 initiatives and supported by the recovery of the global economy, which is forecasted to rebound by 5.2% according to the IMF. Previously the government predicts 2021 GDP to be the range of 5.5% to 8.0%. • In comparison to other multilateral agencies, the International Monetary Fund (IMF) forecasts Malaysia’s GDP to bounce back to 7.8% next year while the World Bank expects a growth of 6.9%. The Asian Development Bank (ADB) keeps its forecasts for Malaysia’s GDP growth at 6.5% for next year although it downgraded 2020 GDP growth to -5% from -4% previously. All projections assumed a mass COVID-19 vaccine deployment probably later next year. • For now, we do not intend to change our 2021 GDP projections of 6.4%. We would like to see further economic assessment especially towards the fourth quarter of this year before making any revision. We will update the key macroeconomic projections in our upcoming 2021 Annual Strategy report soon. • The strong rebound in GDP growth will be driven by the anticipated improvement in global growth and international trade as indicated. On top of that, the impact of the stimulus packages implemented by the government is anticipated to have spillover effects and provide an additional boost to the economy in 2021. • Still, risks remained to the downside as the favourable outlook hinges on two major factors — the successful containment of Covid-19 and sustained recovery in external demand. Figure 2: Malaysia’s Real GDP Growth (2016 – 2021F) Source: Economic Report 2020/2021, TA Securities Page 10 of 42
30. 06-Nov20 Vibrant Private Sector Activity • The strong outlook is premised on resilient domestic demand, which is forecast to expand by 6.9% in 2021 after a 3% decline in 2020. This is amid expectation that the key growth engines, mainly consumer spending, private investment and public investment, all would be functioning as expected. • Growth will be steered by sustained private consumption at 7.1% in 2021 versus a 0.7% decline in 2020. The growth will be primarily driven by higher disposable income stemming from buoyant economic activities, accommodative financial stance, an extension of tax relief on childcare and healthcare and favourable stock market conditions. Better job prospects on an improving economy will also improve household spending, as well as recovery in tourismrelated sectors that will contribute to better private consumption next year. The unemployment rate is projected to decrease to 3.5% in 2021, compared with an estimated 4.2% in 2020. Further supporting growth are various measures by the government to uplift disposable income, as per Budget 2021 speech, which include: - Allowing a monthly withdrawal of RM500 from Account 1 of the Employees’ Provident Fund (EPF) to assist those who have lost their jobs due to the Covid-19 pandemic. The withdrawal is up to RM6,000 for a period of 12 months, aimed at alleviating financial hardship faced amongst its 600,000 members. - EPF contribution for employees reduced from 11% to 9% for 12 months beginning January 2021. - Tax relief increased to RM8,000 for parents' medical, special needs and care expenses. - To be renamed Bantuan Prihatin Rakyat, with RM6bn allocated to benefit 8.1mn people. Households with monthly income below RM2,500 with one child will receive RM1,200, while households with two children will receive RM1,800. Households with monthly income between RM2,501 – RM4,000 will with one child will receive RM800, while households with two children will receive RM1,200. Single adults with monthly salary below RM2,500 will receive RM350. The age limit for single individuals is also reduced to 21 years old from the previous 40 years old. - Special RM600 for civil servants Grade 56 and below. Meanwhile, for retired civil servants and veterans with no pension, the government will provide RM300 special aid. - Increase of allowance from RM6 to RM8 an hour for 1,900 volunteer firefighters. - 1% decrease in income tax for those earning between RM50,001 to RM70,000 per year. • Private investment is expected to rise by 6.7% in 2021 after an 11.7% contraction in 2020. The government mentioned that there would be more private investment next year as government-led initiatives such as tax incentives to attract foreign direct investment (FDI) and the establishment of the Project Acceleration and Coordination Unit (PACU) will help to drive private investments, on top of spill-over effects from fiscal injections. • Meanwhile, public investment is likely to rebound by 16.9% in 2021 after contracting by 9.3% in 2020. The continuation of mega projects, such as Mass Rapid Transit 2 (MRT2), and the Pan Borneo Highway will provide the impetus for public investment. Public corporations are also expected to continue investing in new and on-going projects, among others, development of O&G related projects, upgrading of digitalisation-related activities and construction of energy plants. • On top of that, the government will be spending more in 2021. A 2% rise in public consumption is expected from an expected 1.6% increase in 2020. Page 11 of 42
31. 06-Nov20 Figure 3 : Malaysia’s Real GDP Growth Performance by Demand Side (2018 – 2020F) Actual 2019 7.60% 2.00% -2.10% -10.90% 1.60% 9.70% -1.30% -2.50% 4.30% Demand Side (% YoY) Private Expenditure Public Expenditure Gross fixed capital formation Private Investment Public Investment Net Exports Exports Imports GDP TA 2020E -4.50% 3.00% -7.60% -12.70% -5.70% -17.30% -6.80% -5.50% -4.50% MOF 2021F 6.30% 2.40% 9.90% 5.50% 11.40% 0.10% 5.50% 6.10% 6.40% 2020E -0.70% 1.60% -11.10% -11.70% -9.30% -24.90% -13.40% -11.90% -4.50% 2021F 7.10% 2.00% 9.50% 6.70% 16.90% 4.10% 8.70% 9.20% 6.5% - 7.5% Source: Economic Report 2019/2020, TA Securities Broad-based Growth • On the supply side, growth is expected to be broad-based next year will all economic sectors recording a positive growth after a contraction in 2020. This year, the construction sector is expected to contract the most at 18.7%, followed by the mining industry at 7.8%. Meanwhile, the services, manufacturing and agriculture sectors are anticipated to contract by 3.7%, 3% and 1.2% respectively, The outlook is expected to be better in 2021 with the construction sector is expected to grow the most at 13.9% on account of the acceleration and revival of major infrastructure projects, coupled with affordable housing projects. The civil engineering segment will also spur the recovery. This is followed by the services and manufacturing industries’ expansion of 7% each. Breakdown showed all sub-sectors within the industry are projected to grow in 2021 as economic activities normalise led by wholesale & retail trade backed by food-related industries. As for the manufacturing sectors, growth next year will be driven by steady improvement in both the export and domestic-oriented industries. The E&E segment is projected to accelerate in line with the digital transformation as WFH (work-from-home) and virtual communications become part of new business practices. Further, higher demand for integrated circuits, memory and microchips within the global semiconductor market will further support the E&E segment Meanwhile, the agriculture is expected to grow by 4.7% next year, supported mainly by higher production of palm oil and rubber. And, the mining sector to seen growing by 4.1% in 2021 supported by the recovery in global demand for crude oil and condensate as well as LNG. Figure 4: Malaysia’s Real GDP Growth Performance by Supply Side (2018 – 2020F) Supply Side (% YoY) Agriculture Mining Manufacturing Construction Services GDP Actual 2019 2.00% -2.00% 3.80% 0.10% 6.10% 4.30% TA 2020E -1.90% -6.70% -1.90% -14.20% -4.60% -4.50% MOF 2021F 1.40% 1.30% 10.70% 1.50% 6.30% 6.40% 2020E -1.20% -7.80% -3.00% -18.70% -3.70% -4.50% 2020E 4.70% 4.10% 7.00% 13.90% 7.00% 6.5% - 7.5% Source: Department of Statistics, Economic Report 2019/2020, TA Securities Page 12 of 42
32. 06-Nov20 2020 Deficit to Hit 6 .0% • The revenue performance for 2020 to be negatively affected, as widely expected, amid slower economic activities and lower crude oil price assumption due to the COVID-19 pandemic. As such, total revenue is revised lower to RM227.3bn or 15.8% of GDP as compared to the budget estimate of RM244.5bn. • In contrast, total expenditure is expected to increase by 6% or RM17.7bn to RM314.7bn. This is due to the fiscal stimulus injection of RM38bn off-set by savings of RM20.3bn from the revision of existing programmes and projects as well as the shortfall in spending from budget estimates. The OE for 2020 is now estimated at RM226.7bn from original allocation of RM241bn while the DE is seen at RM50bn (initial allocation: RM56bn). • With lesser revenue projection amid higher expenditure including the RM38bn COVID-19 Fund, 2020 fiscal balance is projected to increase to RM86.5bn as compared to earlier forecast of RM52.5bn. With that, this year’s fiscal deficit as percentage of GDP is higher at 6.0% of GDP (2019: -3.4% of GDP). Statistics showed federal government position had already registered a deficit of RM52.7bn as of 1H20, much higher than RM22.4bn deficit recorded in the same period last year. That is equivalent to -7.9% of GDP. In 2Q20 alone, total deficit was -8.1% of GDP. Figure 5: Federal Government Financial Position (2018 – 2020F) Financial Position Revenue Operating Expenditure Current Deficit/ Surplus Gross Development Expenditure Less: Loan Recoveries Net Development Expenditure Covid-19 Fund Overall Surplus/ Deficit % Share of GDP 2019 264.42 263.34 1.07 54.17 1.60 52.57 -51.50 -3.4% Economic Report 2020/2021 RMbn Change (%) 2020E 2021F 2019 2020E 227.27 236.90 13.5% -14.0% 226.72 236.54 14.0% -13.9% 0.55 0.36 -44.2% -48.7% 50.00 69.00 -3.4% -7.7% 1.00 0.80 103.4% -37.6% 49.00 68.20 -4.9% -6.8% 38.00 17.00 -86.45 -84.84 -3.5% 67.9% -6.0% -5.4% 2021F 4.2% 4.3% -34.5% 38.0% -20.0% 39.2% -55.3% -1.9% Source: Economic Report 2020/2021, TA Securities A More Targeted Fiscal Support for 2021 and Years Ahead • The government would continue to focus on the recovery measures to revitalise the economy at the same time remained committed to maintain a path of fiscal consolidation. As the Budget 2021 marks the beginning of the 12th Malaysia Plan (12MP), allocations will be channelled towards more targeted programmes and projects with high multiplier impact to ensure value for money. • 2021 fiscal deficit is expected to be at 5.4% of GDP, almost in line with our expectation of -5.5% of GDP. We find the target is realistic and achievable especially with the current economic scenario and volatile oil prices. • Under the Medium-Term Fiscal Framework (MTFF), which provides a macro-fiscal projection over three years, Malaysia’s fiscal deficit is expected to be lower at -4.5% of GDP by 2023. That is based on assumption that: 1) real GDP growth of 4.5% to 5.0% (nominal GDP: 5.5% to 6.5%); 2) crude oil price forecast of between USD45 to USD55 per barrel; and 3) crude oil production of 580,000 barrels per day. • In the medium-term period (2021-2023), total revenue is expected to reach RM731bn or RM14.7% of GDP, contributed mainly from non-petroleum revenue, which is forecast at RM609.7bn (12.3% of GDP). Meanwhile, petroleum-related revenue is estimated at Page 13 of 42
33. 06-Nov20 RM121 .3bn or 2.4% of GDP. Within these 3 years, the government will enhance its revenue by exploring new sources, widening the revenue base, improving tax administration and adopting the Medium-Term Revenue Strategy (MTRS). • The total indicative ceiling for the three-year expenditure, including COVID-19 Fund allocation, is estimated at RM959.8bn or 19.3% of GDP. OE allocation is projected at RM730.3bn while DE at RM212.5bn. Figure 6: Malaysia’s Fiscal Balance (2010 – 2021F) Source: Economic Report 2020/202, TA Securities Figure 7: Medium Term Key Macroeconomic Projections 2021-2023 RMbn Share of GDP (%) Revenue 731.0 14.7 Petroleum 609.7 12.3 Non-petroleum 121.3 2.4 Operating Expenditure 730.3 14.7 Current Balance 0.7 0.0 Gross Development Expenditure 212.5 4.3 Less: Loan Recoveries 2.0 0.1 Net Development Expenditure 210.5 4.2 Covid-19 Fund 17.0 0.3 Overall Balance -226.8 -4.5 Primary Balance -102.8 -2.1 Underlying assumptions Real GDP Growth (%) 4.5-5.5 Nominal GDP Growth (%) 5.5-6.5 Crude Oil Price (USD per Barrel) 45-55 Oil Production (Barrels per day) 580,000 Source: Economic Report 2020/202, TA Securities Page 14 of 42
34. 06-Nov20 Enhancing Revenue Sources • As the nation to shift from the recovery phase towards achieving its growth potential in the new normal, 2021 total revenue is envisaged to turn around by 4.2% in 2021 to RM236.9bn versus the lower than expected earnings of RM227.3bn this year. Initially, our total revenue was expected to be at RM244.5bn for 2020 before COVID-19 pandemic hit the economy. Current revenue allocation is roughly equivalent to 15.1% of GDP. It is within of expectation (close to our 2021 revenue forecast of RM238.4bn) on the back of improving economic growth and business prospects. • Tax revenue remains as the main contributor with expected total collection of RM174.4bn, an increase of 13.8% than 2020. As a percentage to GDP, tax revenue constitutes 11.1% while non-tax revenue at 4%. • In terms of growth, expect a higher direct tax collection by 14.6% to RM131.9.1bn, constituting 55.7% to total revenue (2020E: RM115.1bn) with assumption of better collection from individual and companies’ income tax. - Companies income tax, or CITA, is expected to contribute the most by RM64.6bn or 8.8% increase than before. This is in tandem with improving economic activities and higher earning expectations, coupled with continuous efforts by the Inland Revenue Board (IRB) to enhance auditing and tax compliance. - Similarly, Petroleum Income Tax, or PITA, is anticipated to rebound by 52% on account of improved demand and slightly higher average crude oil assumption of USD42 per barrel (2020E: USD40 per barrel). - Also, expect higher individual income tax of RM42.4bn attributed to stable employment prospect and sustained wage growth. This is despite lower income tax rate by 1%- point for those earning taxable wages from RM50,001 to RM70,000 which only expected to benefit 1.4mn taxpayers. According to the IRB, the tax rate for this income category for Year Assessment 2020 is 14%. This would make the rate to be 13% for Year Assessment 2021. (See Figure 10) - Revenue from other direct tax consists of stamp duty, RPGT and other taxes is provisioned at RM8.8bn or 7% increase than 2020. • Meanwhile, indirect tax collection is also expected to be higher by 11.4% to RM42.5bn (2020E: RM38.2bn) mainly contributed by higher SST collection of RM27.9bn in line with improving consumer spending, Likewise, excise duties are estimated to expand by 3.1% to RM8.8bn in tandem with higher demand for motor vehicles (2021F: +17%) following the introduction of new models and ongoing promotional campaigns in the industry. Meanwhile, export duty is expected to remain stable at RM0.9bn. • We also noted lesser non-tax revenue by 15.5% to RM62.5bn next year (2020E: RM74bn), primarily due to lower proceeds from investment income. Dividends from PETRONAS and Khazanah are estimated at RM18bn and RM1bn, respectively. In addition, the government will continue to receive a special payment from KWAP amounting RM5bn to partly finance the retirement charges. Petroleum royalty is forecast to reach RM4.3bn in consonance with higher crude oil price. • A more diversified revenue has resulted non-oil revenue contribution to be more much higher, to 84% for next year versus less than 78% in 2020 and 68.3% in 2018. This will help to limit volatility and strengthen the sustainability of its fiscal position over the medium term. It is estimated that for every USD1 per barrel increase in crude oil price, the government’s revenue will go up by about RM300mn (vice versa). Petroleum-related revenue is forecast to be lower at RM37.8bn or 2.4% of GDP, compared with RM50bn of 3.5% in 2020. Consequently, non-petroleum revenue is envisaged to increase by 12,3% to RM199.1bn. Page 15 of 42
35. 06-Nov20 Figure 8 : Federal Government Revenue (2019 – 2021F) Economic Report 2020/2021 Revenue RMbn Change (%) Share (%) 2019 2020E 2021F 2019 2020E 2021F 2019 2020E 2021F Tax Revenue 180.6 153.3 174.4 3.7% -15.1% 13.8% 12.0% 10.6% 11.1% Direct Tax 134.7 115.1 131.9 3.6% -14.6% 14.6% 8.9% 8.0% 8.4% CITA 63.8 59.4 64.6 -4.1% -6.8% 8.8% 4.2% 4.1% 4.1% Individual 38.7 35.9 42.4 18.6% -7.2% 18.2% 2.6% 2.5% 2.7% PITA 20.8 8.6 13.0 3.5% -58.9% 52.0% 1.4% 0.6% 0.8% 45.8 38.2 42.5 4.1% -16.8% 11.4% 3.0% 2.6% 2.7% GST/SST 27.7 24.5 27.9 7.7% -11.3% 13.7% 1.8% 1.7% 1.8% Excise Duties 10.5 8.5 8.8 -2.5% -19.1% 3.1% 0.7% 0.6% 0.6% Import Duty 2.7 2.0 2.1 -5.7% -25.5% 0.7% 0.2% 0.1% 0.1% Indirect Tax Export Duty Non-Tax Revenue 1.1 0.8 0.9 -34.7% -28.8% 15.0% 0.1% 0.1% 0.1% 83.8 74.0 62.5 42.5% -11.7% -15.5% 5.6% 5.1% 4.0% Total Revenue 264.4 227.3 236.9 13.5% -14.0% 4.2% 17.5% 15.8% 15.1% Nominal GDP 1,510.8 1,440.8 1,571.1 4.4% -4.6% 9.0% 100.0% 100.0% 100.0% Source: Economic Report 2020/2021, TA Securities Figure 9: % Petroleum-Related and Non-Petroleum Revenue (2009 – 2021F) % 100.0 80.0 41.3 35.4 32.2 37.8 60.0 40.0 20.4 17.6 16.0 43.1 46.8 50.2 20.0 19.0 19.2 0.0 7.5 7.6 14.8 10.4 11.3 2009 2010 2019 Petronas Special Dividend Direct Tax (Exc. PITA) 20.4 22.0 10.8 4.4 2020 11.8 SST Petroleum Revenue Petroleum NonPetroleum 2021 Others Source: Economic Report 2020/2021, TA Securities Figure 10: Chargeable Income Band for YA 2021 Chargeable Income 0-5,5000 5,001-20,000 20,001-35,000 35,001-50,000 50,001-70,000 70,001-100,000 100,001-250,000 250,001-400,000 400,001-600,000 600,001-1,000,000 1,000,001-2,000,000 Exceeding 2,000,000 New Tax Rate (%) 0 1 3 8 13 21 24 24.5 25 26 28 30 Source: IRB, 2021 Budget Speech, TA Securities Page 16 of 42
36. 06-Nov20 Higher Expenditure to Revitalise Growth and Restore Confidence • 2021 Budget would allocate RM322.54bn for all government expenses (or 20.6% of GDP), RM25.5bn more than 2020’s revised allocation of RM314.7bn (TA forecast: RM324bn). We noted a new category of allocation was created in 2020 and 2021, namely the COVID-19 Consolidated Fund, intended for dealing with the pandemic. Under this provision, the government has allocated RM38bn for 2020 and RM17bn for 2021 along with expectation of better pandemic situation and vaccine development. To recap, the COVID-19 Fund was established with a validity period of three years ending 31 December 2022. Excluding the COVID-19 Fund, total expenditure would be at RM305.5bn. • Of this total, RM236.5bn or 73.3% will be channelled to Operating Expenditure (OE), RM69bn (21.4%) to Development Expenditure (DE) and RM17bn (5.3%) is for the COVID-19 Fund. Malaysia's OE is normally bigger than DE and that under our Constitution, the government cannot finance OE using borrowings. The government can borrow only for DE. • By sectoral excluding the COVID-19 Fund, 37.7% is allocated for programmes and projects under the social sector, followed by the economic (18.3%), security (11%) and general administration (7.7%) sectors. By Ministries, the top three recipients constituting 38.5% of total expenditure or RM117.5bn are the Ministry of Education (MOE), Ministry of Finance and Ministry of Health (MOH). • The allocation for 2021 OE is equivalent to 15.1% of GDP, slightly higher by 4,3% from the revised budget of RM226.7bn in 2020. About 70% of total OE is provided for emoluments and charged expenditures, which includes debt service charges, retirement charges as well as grants and transfers to state government under the Federal Constitution. As usual, emoluments alone are estimated to contribute the biggest, about 35.7% of total OE, with an allocation of RM84.5bn for next year versus RM82.6bn this year. • The provision for subsidies and social assistance next year is seen lesser by 6.4% to RM18.9bn versus this year’s revised allocation of RM20.1bn. The decline is mainly due to consolidation of cash assistance programmes under BSH and BPN. During the tabling of Budget 2021, the Bantuan Sara Hidup (BSH) assistance programme will be replaced with the Bantuan Prihatin Rakyat (BPR) programme. Under the new BPR programme, aid to B40 and M40 groups will be increased and allocated according to the household income as well as number of children in each household. Figure 11: Operating Expenditure vs. Development Expenditure (2005 – 2021F) RMbn 350.0 DE OE 300.0 250.0 200.0 150.0 100.0 50.0 2021F 2020E 2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 0.0 Source: Economic Report 2020/2021, TA Securities Page 17 of 42
37. 06-Nov20 Figure 12 : % Share of Total Expenditure (2021F) Figure 13: Malaysia Total Expenditure – RMbn (2021F) Source: Economic Report 2020/2021, TA Securities Figure 14: Federal Government Operating Expenditure (2019 – 2021F) Economic Report 2020/2021 Operating Expenditure RMbn Change (%) Share (%) 2019 2020E 2021F 2019 2020E 2021F 2019 2020E Emoluments 80.5 82.6 84.5 0.7% 2.6% 2.3% 30.6% 36.4% 2021F 35.7% Retirement charges 25.9 27.1 27.6 2.8% 4.5% 2.0% 9.8% 11.9% 11.7% Debt service charges 32.9 34.9 39.0 7.8% 6.1% 11.6% 12.5% 15.4% 16.5% Grants to state government 7.6 7.7 7.7 -0.4% 2.3% -0.1% 2.9% 3.4% 3.3% Supplies and services 31.5 30.1 32.8 -10.7% -4.5% 8.9% 12.0% 13.3% 13.9% Subsidies 23.9 20.1 18.9 -13.1% -15.7% -6.4% 9.1% 8.9% 8.0% Asset Acquisition 0.8 0.7 0.5 72.2% -15.6% -16.6% 0.3% 0.3% 0.2% Refunds & Write-offs 0.9 1.0 0.5 1.1% 10.5% -48.2% 0.3% 0.4% 0.2% Grant to statutory Bodies 13.8 14.0 15.4 0.1% 1.9% 9.9% 5.2% 6.2% 6.5% Other Expenditure 45.6 8.4 9.6 367.3% -81.5% 13.5% 17.3% 3.7% 4.0% Total Operating Expenditure 263.3 226.7 236.5 14.0% -13.9% 4.3% 100.0% 100.0% 100.0% Source: Economic Report 2020/2021, TA Securities Higher Development Expenditure to Spur Growth • The allocation of Development Expenditure (DE) is seen higher next year at RM69bn, along with the government’s pledge to churn economic activities by roiling out mega projects. Indeed, the government pledged to channel the DE to programmes and projects with high multiplier impact to promote economic growth and support the livelihood of the rakyat. • The DE allocation is the highest so far in history and also beat our estimates of RM60bn. We also noted that 2020’s DE allocation has been reduced to RM50bn as compared to initial allocation of RM56bn announced during Budget 2020 last year. This is due to the deferment and slower progress of several projects during the Movement Control Order (MCO) period. • Of the total DE, RM67.3bn is in the form of direct allocation, while RM1.7bn is for loans to state governments and government-linked entities. By sector, the Economic Sector received the highest allocation of RM38.9bn under the DE encompassing transport, trade, industry, energy and public utilities and agriculture. The Social Sector would receive RM18.4bn, followed by the Security Sector, RM7.8bn and General Administration, RM3.9bn. • The health subsector remains a priority which will receive an allocation of RM4.7bn or 6.8% of total DE. The focus of spending under this subsector will be to expand the health sector and provide an effective national healthcare system, according to the report. More new Page 18 of 42
38. 06-Nov20 hospitals and clinics will be built , it said, especially in small districts to ensure an affordable, equitable and accessible healthcare system. In addition, outlays will also be provided for the upgrading and maintenance of hospitals and clinics as well as procurement of medical service vehicles and equipment. Major ongoing projects under this subsector include the construction of Serdang Hospital Cardiology Centre, Putrajaya Hospital Endocrine Complex and Lawas Hospital, in addition to the upgrading of Kajang hospital and Tawau hospital. Figure 15: Federal Government Development Expenditure by Sector (2019 – 2021F) Economic Report 2020/2021 Development Expenditure RMbn Change (%) Share (%) 2019 2020E 2021F 2019 2020E 2021F 2019 2020E 2021F 31.3 28.5 38.9 -13.3% -8.9% 36.3% 57.8% 57.1% 56.4% Transport 13.8 10.2 15.0 -19.1% -25.9% 47.5% 25.4% 20.4% 21.8% Trade & Industry 3.1 2.4 3.1 21.6% -20.2% 28.0% 5.6% 4.9% 4.5% Public Utilities & Energy 2.8 3.6 3.3 22.4% 29.9% -7.1% 5.1% 7.2% 4.8% Agriculture & Rural Development 2.3 3.0 2.9 8.5% 30.3% -4.0% 4.3% 6.0% 4.2% Economic Sector Social Sector 14.5 13.1 18.4 12.5% -9.8% 40.7% 26.7% 26.1% 26.6% Education & Training 7.6 5.9 8.9 17.3% -23.0% 51.1% 14.1% 11.7% 12.9% Health 1.8 2.9 4.7 3.0% 57.8% 63.9% 3.4% 5.8% 6.8% Housing 2.1 1.5 1.8 65.4% -29.9% 23.0% 3.9% 3.0% 2.7% Security 5.6 5.6 7.8 13.9% -1.0% 40.0% 10.4% 11.1% 11.3% Defence 2.9 2.7 4.9 -10.1% -9.1% 82.4% 5.4% 5.3% 7.0% Internal Security 2.7 2.9 2.9 60.9% 7.8% 1.0% 5.0% 5.8% 4.2% General Administration 2.8 2.9 4.0 26.7% 3.1% 38.6% 5.1% 5.7% 5.7% Gross Development Expenditure 54.2 50.0 69.0 -3.4% -7.7% 38.0% 100.0% 100.0% 100.0% Source: Economic Report 2020/2021, TA Securities Federal Government Debt to Increase to 61% of GDP in 2021 • The federal government is raising more debt to finance a wider fiscal deficit as it is in the driver seat to steer the economy out of recession. The national debt is expected to inch up further to hit 61% of GDP in 2021, up from 60.7% in 2020 and 52.5% in 2019. In Budget 2020, the federal government debt was initially estimated to hover around 53% of GDP, with the targeted fiscal deficit at 3.2% of GDP. Despite the growing debt figures, the government noted that most of the measures taken to stimulate growth are short-term in nature and do not fundamentally change the principles of debt management. • The national debt had already expanded to RM874.3bn or 60.7% of GDP as at endSeptember 2020 — from RM793bn or 52.5% of GDP in 2019. Domestic debt, mainly Malaysian Government Securities (MGS) and Malaysian Government Investment Issues (MGIIs), made up 96.7% of the country’s borrowings, according to the Ministry of Finance’s (MoF) Fiscal Policy Review 2021. • Moving forward, the government is committed to continuing the debt consolidation path in the medium term once the economy recovers from the current crisis. The government also pledged to strike a balance between addressing development needs and consolidating the debt-to-GDP level once the crisis subsides. Page 19 of 42
39. 06-Nov20 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY * Construction Sector Neutral A Reasonable Allocation for Infrastructure Development Ooi Beng Hooi Tel: +603-2167 9612 benghooi@ta.com.my www.taonline.com.my Largely Within Expectation The proposed allocation of RM69bn for development expenditure in Budget 2021 was significantly higher (+23.21%) compared to RM56bn previously tabled for Budget 2020. In this Budget, the coverage on the construction sector was much within ours and market expectations. Key construction-related items mentioned in Budget 2021 include: 1) RM15bn will be allocated to fund the ongoing Pan Borneo Highway, Gemas-JB Electrified Double Tracking Project and Klang Valley Double Tracking Project Phase 1; 2) Implementation of JB-Singapore Rapid Transit System and MRT3 in the Klang Valley; 3) Continuation of KL-Singapore High Speed Rail, subject to further discussion with Singapore; 4) Allocation of RM3.8bn for: a) 2nd Phase of the Klang Third Bridge in Selangor; b) Continuation of Central Spine Project with the new alignment from Kelantan to Pahang; c) Upgrading of Sungai Marang Bridge, Terengganu; d) Upgrading of Federal Road linking Gerik, Perak and Kulim, Kedah; e) Construction and upgrading of Phase 3 of Pulau Indah Ring Road, Klang, Selangor; f) Construction of Pan Borneo Sabah for package from Serusop to Pituru; and g) Construction of Cameron Highlands Bypass. 5) Allocation of RM780mn for infrastructure development at 5 economic corridors: a) 3 Bus Rapid Transit lines in development area of Iskandar Regional Development Authority; b) Construction of Palekbang bridge to Kota Bahru, Kelantan under East Coast Economic Region; c) Construction of infrastructure and related components at the Special Development Zone at Yan and Baling, Kedah, under Northern Corridor Economic Region; d) Infrastructure project in Samalaju Industrial Area under Sarawak Corridor of Renewable Energy; and e) Continuation of Sepangar Bay Container Port Expansion Project in Sabah under Sabah Development Corridor. 6) Allocation of RM150mn for raw water transfer from Sungai Kesang and Tasik Biru to Jus Dam, Melaka; 7) Continuation of Kwasa Damansara development with an estimated GDV of RM50bn; As usual, there was a budget of RM2.7bn allocated for infrastructure development at rural areas. This includes: a) RM1.3bn to implement rural and inter-village road projects spanning 920km; b) RM632mn for rural and alternative water supply; c) RM250mn for rural electricity supply: d) RM355mn for House Assistance Programme which builds and repairs houses for the poor; e) RM121mn to install 27k units of lamps as well as to cover the operational and maintenance costs for 500k units of street lights in village. Separately, there was a development expenditure allocation of RM5.1bn and RM4.5bn for Sabah and Sarawak respectively, to build and upgrade water, electricity, roads, healthcare and education facilities. Page 20 of 42
40. 06-Nov20 Our View There is no major surprise for the construction sector in this Budget . New mega projects to be implemented, i.e. MRT3 and JB-Singapore Rapid Transit System are within ours and market expectations, as highlighted in our Budget Preview report dated 16 October 2020. Given budget constraints, we think that there is a possibility that the government could reengineer the design of the MRT3 line by reducing the length of the underground section to bring down the project cost. Besides, the project duration could be stretched longer to ease the financial burden on the government. With proven track record in MRT1 and MRT2, we think it is highly likely that MMC-GAMUDA JV will be appointed as the Project Delivery Partner and underground contractor for MRT3. For main work packages, those with track records in MRT1 and MRT2 such as IJM, SUNCON, GADANG, WCT, KIMLUN, MUDAJYA, AZRB, GBGAQRS, ANEKA and ECONBHD. We are encouraged that the government is proceeding with KL-Singapore High Speed Rail, subject to further discussion with Singapore. A timely rollout of the KL-Singapore High Speed Rail is crucial to replenish the depleting order book of MRT2, LRT3, various highway construction such as WCE, SUKE, DASH, EKVE and SPE, as well as the Pan Borneo Highway and Gemas-JB Electrified Double Tracking Project. Potential beneficiaries of KL-Singapore High Speed Rail include YTL, GAMUDA, MMC, MRCB, SUNCON, IJM, WCT, GADANG, ECONBHD, ANEKA and ADVCON. Conclusion We see Budget 2020 having a NEUTRAL impact on the construction sector. Maintain our UNDERWEIGHT call on the sector as: i) competition within the infrastructure space is expected to remain intense due to a drought in awards of mega projects post-GE14; ii) government’s financial constraint given the increasing national debt; iii) political instability; iv) resurgence of Covid-19 cases; and v) unattractive valuation of the construction sector. However, with the recent launch of Bandar Malaysia and continuation of Kwasa Damansara with a combined GDV of RM190bn, we are seeing light at the end of the tunnel for the builders, especially those with strong balance sheet and proven track record, as there is a much bigger pie to be shared among the builders. In fact, we opine that during such time, after an economic upheaval, property developers and building owners would prefer to appoint reliable building contractors such as SUNCON, KERJAYA, GDB, INTA and TCS, which are backed by proven track records, in terms of timely completion and work quality, as well as solid balance sheet, to ensure smooth, successful and timely delivery of the projects. Despite cautiousness in the property market, we have seen several building jobs being awarded post-MCO period to GDB, INTA and TCS. Out top picks for the sector are INTA and GDB. Company Call Price (RM) Target PER (x) ROE (%) Div Yield (%) P/BV (x) Price (RM) CY19 CY20 CY21 FY19 FY20 FY21 FY19 FY20 FY21 FY19 FY20 FY21 GAMUDA Sell 3.69 3.50 16.8 14.8 14.1 9.0 6.0 7.7 3.3 1.6 3.3 1.1 1.1 1.0 IJM Sell 1.45 1.48 19.2 42.1 19.2 3.6 2.6 0.9 2.8 2.1 2.8 0.6 0.5 0.6 SUNCON Sell 1.82 1.84 18.2 28.0 17.8 21.3 13.3 19.7 3.8 2.5 3.8 3.8 3.6 3.4 KAB Sell 0.925 0.19 74.9 100.5 78.1 17.6 15.0 14.4 0.4 0.4 0.4 11.0 11.2 10.2 WCT Sell 0.395 0.335 6.8 (29.7) 24.3 2.5 (60.5) 74.2 0.0 0.0 0.0 0.2 0.2 0.2 GDB Buy 0.69 0.95 14.8 16.1 8.7 25.9 20.4 31.6 2.9 2.9 2.9 3.6 3.2 2.5 GADANG Sell 0.395 0.29 7.1 9.0 8.3 6.8 5.4 3.7 3.0 2.5 2.5 0.4 0.4 0.3 PESONA Sell 0.255 0.235 16.0 90.6 10.5 6.1 1.1 8.8 3.9 3.9 3.9 0.9 0.9 0.8 INTA Buy 0.30 0.53 7.2 21.4 6.8 17.4 5.0 15.1 3.3 0.8 2.5 1.2 1.0 1.0 Sector (Simple Average) 20.1 32.5 20.9 12.2 0.9 19.6 2.6 1.9 2.5 2.5 2.5 2.2 Sector (Market Weighted) 19.6 27.2 18.8 9.6 4.7 10.1 3.0 1.8 3.0 1.8 1.7 1.6 Big Cap (Simple Average) 18.1 28.3 17.0 11.3 7.3 9.4 3.3 2.1 3.3 1.8 1.8 1.7 Mid/ Small Cap (Simple Average) 21.1 34.7 22.8 12.7 (2.3) 24.6 2.3 1.8 2.0 2.9 2.8 2.5 Page 21 of 42
41. 06-Nov20 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY * Consumer Sector Positive Good for Domestic Player, a Win for BAT Jeff Lye Zhen Xiong, CFA Tel: +603-2167 9730 jefflye@ta.com.my www.taonline.com.my Review Key consumer-related measures mentioned in Budget 2021 are: i) Bantuan Prihatin Rakyat (BPR) cash assistance allocation of RM6.5bn; Household Monthly Income with up to one child < RM2500 RM1200 RM2501-RM4000 RM800 RM4001-RM5000 RM500 Single above 21 Years Old with Monthly Income < RM2500 with two children and more RM1800 RM1200 RM750 RM350 Source: Budget 2021 announcement, TA Securities ii) Increase financial assistance to vulnerable groups by additional allocation of RM700mn. iii) Enhance Targeted Loan Repayment giving eligible borrowers a further moratorium of up to 6 months. iv) Optional withdrawal by eligible EPF”s member for up to RM500/month from Account 1 saving. v) Increase tax relief limit for lifestyle to RM3,000 from RM2,500. vi) Reduce income tax for resident individuals by 1%-pts for the chargeable income band of RM50,001 to RM70,000. vii) Launching Skim Jaminan Penjanaan Pekerjaan worth RM3.7bn to provide 500k new job opportunities, via - Hiring incentives to employers; - Reskilling and upskilling programme; and - Targeted wage subsidies. viii) Strengthening Multi-Agency Task Force to address smuggling of high duty goods ix) Specific containment measures over the cigarettes industry through tightening import license and transhipment activities. x) Introduce 10% excise duty on devices for all electronic and non-electronic cigarettes including vape alongside excise duty of 40 sen per millilitre of liquid used in electronic cigarette. Our View The Budget 2021 is positive and is within our expectation. We reckon the financial assistance provided is sufficient to protect the wellbeing of individuals. For example, the allocation of RM6.5bn under BPR to c.8.1mn beneficiaries is greater than the previous year’s Bantuan Sara Hidup programme, which paid RM5.0bn to 4.3mn beneficiaries. Moreover, tax reduction, tax relief and other measures, which aim to increase individual’s disposal income, would allow rakyat to cope with higher cost of living in major cities. Besides, more job opportunities shall become available with the implementation of Skim Jaminan Penjanaan Pekerjaan programme. Food and Beverages (F&B) – We reckon the increase in disposal income of individuals, especially the lower income group, is favourable to consumer staples players. It would spur product’s demands and complement several companies’ ‘premiumnisation’ efforts to enhance the share of value-added products. Page 22 of 42
42. 06-Nov20 Retail – We believe retailers under our coverage would benefit from the expansionary budget too especially those who derive sales predominantly from the domestic market. In specific, we believe the Budget would be the most favourable to AEON, an operator of general merchandise store cum supermarket given that c.50% of its typical retailing revenue are food-line related items. Hence, the company would indirectly ride on the improving demands over consumer staples products. Tobacco – Although the idea of enhancing enforcement against illicit cigarettes is not entirely new, we think the enforcement measures announced in Budget 2021 are more holistic because it directly tackles the identified method of smuggling activities by limiting transhipment activities to dedicated port and through ISO container shipment only, on top of having clearer actions to tighten border enforcements. Moreover, the imposition of 10% excise duty on devices for all electronic and non-electronic cigarettes including vape alongside excise duty of 40 sen per millilitre of liquid used in electronic cigarette would regulate all products thus levelling the playing field between factory-made cigarettes and other products. We also believe that with a clear policy on excise duty now, it would enhance BAT’s confidence in bringing in vape products such as Vype from its parent company and introduce it in Malaysia. This could be a new source of income for BAT. Recommendation Maintain Overweight stance on the Consumer sector as we believe Budget 2021 would be able to steer the domestic economy towards a strong recovery. We believe the financial aids and measures offered to the low-income group and implementation of business-friendly policy would benefit F&B players and retailers with large domestic exposure (Aeon, Amway, Padini, Focus Point, Hup Seng and Nestle). Moreover, BAT, being the largest legal tobacco player in Malaysia is set to benefit from the regulation over vape and the more holistic measures to combat trade of illicit cigarettes. We reiterate our Buy recommendation on BAT with a higher target price of RM14.50/share (previously RM12.50/share) as we lower our ascribed discount rate (from WACC of 9.8% to 8.8%) considering that the business environment is likely to improve with government’s support in combating illicit trade. Peers Comparison Company Brewery Carlsberg Heineken Retail Aeon Amway Padini Focus Point F&B Johore Tin Hup Seng F&N QL Resources Nestle Leong Hup Tobacco BAT Industrial Scientex Signature Poh Huat PER (x) CY20 CY21 P/BV (x) CY20 CY21 EPS Growth (%) CY20 CY21 ROE (%) CY20 CY21 Div Yield (%) CY20 CY21 Call Price Target Price Buy Buy 19.88 19.00 24.50 26.00 30.5 27.6 22.1 19.6 33.2 14.0 31.7 13.7 (32.2) (33.5) 37.6 40.6 125.9 51.9 163.0 70.8 3.0 3.4 4.5 4.9 Buy Buy Buy Buy 0.70 5.10 2.04 0.61 1.25 6.00 2.90 0.76 10.6 18.0 12.9 16.7 7.8 16.1 9.8 12.0 0.6 3.7 1.7 2.0 0.5 3.6 1.5 1.8 (31.6) (19.9) (18.3) (18.8) 35.4 12.2 31.9 39.3 5.4 20.8 11.4 12.1 7.1 22.9 15.3 15.4 5.8 5.4 4.0 2.7 5.8 5.4 5.0 3.8 Buy Hold Buy Hold Sell Buy 1.62 0.92 32.00 6.52 140.10 0.70 2.10 1.00 40.00 7.00 143.00 0.91 12.4 18.1 27.9 60.7 56.7 19.5 9.6 16.0 26.6 53.9 48.3 13.8 1.4 5.1 4.3 7.1 49.9 1.1 1.3 5.2 4.0 6.5 48.2 1.0 (13.0) (2.0) (0.7) 11.8 (14.7) (13.1) 29.1 12.7 4.8 12.6 17.5 41.1 11.6 27.5 16.0 12.1 87.6 7.8 13.9 32.0 15.5 12.7 101.6 10.3 3.7 6.5 1.9 0.5 1.8 1.5 4.3 6.5 2.1 0.5 2.0 2.2 Buy 10.22 14.50 11.1 10.5 7.4 7.3 (26.0) 6.2 67.1 70.1 8.8 9.3 Buy Buy Buy 11.92 0.33 1.89 11.80 0.60 1.77 15.1 25.4 12.5 13.6 7.9 10.7 2.2 0.4 1.1 1.9 0.4 1.0 10.7 144.6 (32.4) 11.1 220.8 17.5 16.2 (1.3) 10.6 16.4 5.2 11.3 2.1 5.5 3.7 2.4 7.0 3.8 Page 23 of 42
43. 06-Nov20 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY * Healthcare Sector Overweight No Windfall Tax Tan Kong Jin Tel: +603-2167 9729 kjtan@ta.com.my www.taonline.com.my Donations from the Big 4 Glove Manufacturers Top Glove, Hartalega, Supermax and Kossan have indicated their commitment to contribute RM400mn to fight against Covid-19. In our view, we are positive as the windfall tax on glove makers’ profits as what the market has anticipated did not materialise, instead substituted with donations to Malaysia’s Covid-19 fund in support of the country’s fight against the pandemic. Note that the RM400mn contribution is much lesser than the potential windfall tax which could be more than RM1.3bn (assuming additional 10% to corporate tax in CY21). We understand that Top Glove would be donating RM185mn or 46.25% of the total of RM400mn. Meanwhile, Hartalega and Supermax will donate RM90mn and RM75mn respectively, while Kossan would be contributing RM50mn. Earnings impact is minimal as these contributions account to around 3.47%-4.3% of their estimated CY20 earnings (see figure 1 for more details). Figure 1:Minimal Earnings Impact on the Big 4 Glove Manufacturers Company Estimated CY20 Profit (RM'mn) Donation Donation in % Estimated Impact on CY20 Net Profit Top Glove 4,645.4 RM185mn 46.25 3.98% Hartalega 2,209.4 RM90mn 22.5 4.07% Supermax 2,162.8 RM75mn 18.75 3.47% Kossan 1,161.9 RM50mn 12.5 4.30% Total 10,179.5 RM400mn 100 Source: Company, TA Securities Table 1: Salient measures related to the Healthcare/Hospital Sector No. 1) 2) 3) 4) 5) 6) Initiative EPF will allow members to withdraw from EPF Account 2 to purchase insurance and takaful products which are approved by EPF relating to life and critical illnesses coverage for themselves and their family. An additional RM1bn allocated to stem the third wave of COVID-19. The government has allocated RM3bn next year to purchase Covid-19 vaccines, including sourcing them from global coronavirus vaccine access plan COVAX. Strengthen the Ministry of Health's Off-Take Agreement Programme to attract investment and potential vaccine production in the future. The Government will also provide incentive including preferential tax rate of 0 to 10 percent for 10 years to encourage manufacturers of pharmaceutical products including vaccines to invest in Malaysia. Allocation of RM35mn to the Malaysia Healthcare Travel Council to enhance the competitiveness of the local health tourism industry. The Government will also extend income tax exemption for the export of private healthcare services until the year of assessment 2022. Increase tax relief limit on medical expenses for self, spouse and child for serious diseases from RM6k to RM8k and tax relief limit for expenses on full medical check-up from RM500 to RM1k. In addition, the limit of tax relief on expenses for medical treatment, special needs and parental care is increased from RM5k to RM8k. Source: 2021 Budget Speech, TA Securities Page 24 of 42
44. 06-Nov20 Our View The government intends to allocate RM17bn under the Covid-19 fund to stem the Covid-19 pandemic . Besides, it will allocate RM3bn to purchase Covid-19 vaccines. Pharmaceutical manufacturers, including companies which produce vaccines, especially for Covid-19, will benefit from low income tax rate of between 0 and 10 per cent for the first 10 years. This may benefit vaccine and distribution players like Duopharma, Pharmaniaga, Ho Wah Genting, Bintai, Kanger and Solution. Meanwhile, we are positive on the RM35mn allocation for MHTC to promote medical tourism, which is higher than last year’s allocation of RM25mn. Note that the medical tourism only accounts for circa-5% of KPJ and IHH’s revenue in Malaysia. Besides that, private healthcare providers may indirectly benefit as EPF members are allowed to withdraw savings in their EPF Account 2 to purchase insurance and takaful products, thereby increasing the demand for private healthcare service. Maintain Overweight Overall, we maintain our Overweight stance on the healthcare sector. We are positive as no windfall tax was announced during the Budget. Top picks are Kossan (TP: RM10.30/share), Top Glove (TP: RM10.80/share) and Hartalega (TP: RM25.97/share). Peers Comparison Company Price TP (RM) (RM) 8.50 10.80 Supermax 9.78 Hartalega 18.20 Kossan 7.49 Recom. PER (x) EPS Growth Div Yield (%) ROE (%) P/BV (x) CY20 CY21 CY20 CY21 CY20 CY21 CY20 CY21 CY20 CY21 BUY 14.9 8.7 436.8 72.6 3.6 6.3 67.6 89.2 10.7 6.8 12.33 BUY 12.3 8.7 566.8 41.1 2.9 3.6 106.0 83.8 9.7 5.8 25.97 BUY 28.2 17.5 403.3 61.2 2.1 3.4 75.5 86.9 18.5 13.0 10.30 BUY Rubber Gloves Top Glove Simple Average 16.5 11.6 417.2 41.7 2.4 3.4 64.0 61.1 9.1 6.2 18.0 11.6 456.0 54.1 2.8 4.2 78.3 80.3 12.0 8.0 Hospitals IHH 5.27 6.00 HOLD 85.4 48.6 (41.3) 75.8 0.4 0.6 2.4 4.1 2.0 2.0 KPJ 0.87 0.95 BUY 31.7 21.1 (42.7) 50.5 1.3 2.0 5.8 8.3 3.0 2.8 58.6 34.8 (42.0) 63.1 0.8 1.3 4.1 6.2 2.5 2.4 48.8 43.6 7.3 11.9 1.3 1.5 11.0 11.8 5.3 5.0 Simple Average Pharmaceuticals DPHARMA 4.10 1.97 SELL [ TH E RE M A ININ G OF T H IS P A GE IS IN TE N TI O NA L L Y L E F T BL AN K] Page 25 of 42
45. 06-Nov20 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY * Insurance Sector Neutral Special Gifts to the Life Insurance Segment Chan Mun Chun Tel: +603-2167 9731 mcchan@ta.com.my www.taonline.com.my Budget 2021 Measures Measures in Budget 2021 related to the insurance sector are as detailed in Table 1: Table 1: Measures in Budget 2021 Related to the Insurance Sector No. (1) Initiative EPF has agreed to allow its members to withdraw from EPF Account 2 in order to purchase insurance and takaful products for themselves and their family. The insurance and takaful products are mainly for life and critical illnesses coverage, which must be approved by EPF. (2) The government proposes to enhance the mySalam program to include the coverage for medical devices such as heart stent or prosthesis. (3) The B40 aid recipients will be given a RM50 voucher as financial aid to purchase Perlindungan Tenang products such as life takaful and personal accident. Meanwhile, the government has decided to extend the stamp duty exemption period on all Perlindungan Tenang products with an annual premium or contribution value not exceeding RM100 for another 5 years until year of assessment 2025. Source: 2021 Budget Speech, TA Securities Our View We are generally positive on the measures announced for the insurance sector in Budget 2021. We believe the measure on allowing members to purchase life insurance products via EPF Account 2 is a strong positive catalyst for life insurance companies as it offers an alternative payment method to encourage those people who do not want to incur immediate financial burden to consider purchasing a life insurance product. Meanwhile, the voucher and the extension of the stamp duty exemption period will certainly help to drive the sales of Perlindungan Tenang products. Recommendation We take this opportunity to upgrade our sector call from Underweight to Neutral as we have recently initiated coverage on ALLIANZ with a Buy recommendation. The group has a very strong life business segment, which is expected to benefit from some of the measures mentioned above. Meanwhile, given that a large chunk of underwriting profit for TUNEPRO is derived from travel insurance, we expect the group to continue suffering from the negative impact of Covid-19 until the pandemic is under control. Maintain Sell call on the group. Peers Comparison Price   TP Recomm.  Mkt Cap EPS Growth (%) (RM) (RM) PER (x) ROE (%) Div Yield (%) RMmn CY20 CY21 CY20 CY21 CY20 CY21 CY20 CY21 TUNEPRO 0.31 0.24 SELL 233.05 (54.5) 100.2 10.1 5.1 4.1 7.9 3.9 7.9 ALLIANZ 13.16 17.08 BUY 2,327.87 (11.5) 11.6 5.3 4.8 11.4 11.6 3.8 4.2 Simple average (33.0) 55.9 7.7 4.9 7.7 9.7 3.9 6.1 Market cap weighted (15.4) 19.7 5.7 4.8 10.7 11.3 3.8 4.5 Page 26 of 42
46. 06-Nov20 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY * Property Sector Neutral Muted Impact to Private Developers Thiam Chiann Wen Tel: +603-2167 9615 cwthiam@ta.com.my www.taonline.com.my Muted Impact As expected, the Government did not dish out more positive surprises for the property market in Budget 2021, given that existing positive measures such as the Home Ownership Campaign 2020, RPGT exemption and removal of 70% LTV on third housing loan, are expected to run through 2021. Some of the measures announced in Budget 2021, which could have direct or indirect implications on the property sector are summarised below: Table 1: Summary of Measures that Have Direct/Indirect Implication on the Property Sector Measures 1) Full stamp duty exemption on both instrument of transfer and loan agreement for the purchase of first house worth up to RM500k. The exemption is applicable for the sale and purchase agreement on purchases that are completed from Jan 1, 2021 until Dec 31, 2025. 2) Government will collaborate with selected financial institutions to provide a Rent-to-Own Scheme. This program will be implemented until 2022 involving 5,000 PR1MA houses with a total value of more than RM1.0bn and reserved for first-time home buyers. 3) Construction and completion of affordable homes with an allocation of RM1.2bn for Program Perumahan Rakyat (PPR), Rumah Mesra Rakyat, Perumahan Penjawat Awam Malaysia (PPAM). Impact to Buyers Impact to Developers Overall Impact Beneficiaries Positive to first time home buyers Positive to affordable housing developers Within Expectations. This will reduce the cost of home ownership for Malaysians who have never owned a house. Hua Yang, Ibraco, Glomac, and selected projects of SP Setia and Mah Sing. Positive to participating developers Within Expectations. This will assist first time home buyer to secure their dream homes with zero/low initial capital outlay. Nevertheless, the 5k quotas may be insufficient to meet the pent-up demand. Participating developers Positive to participating developers Within Expectations. The increase in supply of affordable units in strategic locations will help to meet pentup demand. SP Setia, Sime Darby Property, UEM Sunrise, MRCB & other participating developers Positive to first time home buyers Positive to low-to-middleincome firsttime home buyers Source: Budget 2021 Speech, TA Securities Muted Impact, Maintain Neutral Budget 2021 continues to contain elements that strive to make home ownership and financing easier for the low-to-middle-income first-time home buyers. The increase in supply of affordable units in strategic locations should help meet pent up demand. Overall, 2021 budget is in line with our expectations and we see first-time home buyers as key beneficiaries of this budget. While we are slightly disappointed with the absence of incentives to directly ease the financial burden of developers, the absence of cooling measures will help developers weather the current challenging market environment. At this juncture, we are keeping our Neutral stance on property sector. We are in the midst of reviewing our earnings and sector call, pending more updates and guidance from developers in their upcoming 3Q results. Page 27 of 42
47. 06-Nov20 Peers Comparison Price Company Call Target PER (x) price (RM) (RM) CY20 ROE (%) Div Yield (%) P/BV (x) CY21 FY20 FY21 FY20 FY21 FY20 FY21 0.2 IOIPG Buy 0.88 1.06 7.6 8.0 3.2 2.8 1.7 3.4 0.3 SP Setia Buy 0.72 1.06 70.7 10.4 1.2 2.8 0.7 3.5 0.2 0.2 SD Prop Sell 0.58 0.65 50.3 13.5 0.8 2.9 0.9 2.6 0.4 0.4 Sunway Buy 1.28 1.58 18.1 12.2 4.1 6.0 3.5 5.9 0.7 0.7 Mah Sing Buy 0.98 1.28 40.6 10.6 1.7 6.2 1.3 3.1 0.7 0.6 Glomac Buy 0.30 0.36 9.3 8.2 2.5 2.2 3.4 3.4 0.2 0.2 Ibraco Sell 0.50 0.58 8.4 5.7 7.5 10.3 1.5 3.0 0.6 0.6 Hua Yang Buy 0.23 0.27 nm nm 0.4 (1.6) 0.0 0.0 0.2 0.2 29.3 9.8 2.7 3.9 1.6 3.1 0.4 0.4 Sector (Simple Average) Sector (Market Weighted) 31.4 10.9 2.6 4.3 1.9 4.0 0.5 0.5 Big Cap (Simple Average) 37.5 10.9 2.2 4.1 1.6 3.7 0.5 0.5 Mid/Small Cap (Simple Average) 8.8 7.0 3.5 3.6 1.6 2.1 0.3 0.3 . [ TH E RE M A ININ G OF T H IS P A GE IS IN TE N TI O NA L L Y L E F T BL AN K] Page 28 of 42
48. 06-Nov20 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY * Telecommunications Sector Positive RM7.4bn Funding to Improve Broadband Services Wilson Loo, CFA Tel: +603-2167 9606 wilsonloo@ta.com.my www.taonline.com.my Budget 2021 Measures Measures in Budget 2021 related to the telecommunication sector are as detailed in Table 1: Table 1: Measures in Budget 2021 Related to the Telecommunications Sector No. (1) Initiative The Government will allocate RM500mn to implement the National Digital Network Initiative (JENDELA) to ensure the connectivity of 430 schools throughout Malaysia covering all states. At the same time, Malaysian Communications and Multimedia Commission will allocate RM7.4bn for the year 2021 and 2022 to build and upgrade broadband services. (2) The Government will allocate RM1.5bn to implement the Jaringan PRIHATIN Programme to alleviate the financial burden of the B40 group in accessing internet services. During the first quarter of 2021, an estimated 8mn individuals in the B40 category will each be eligible to receive a telecommunication credit worth RM180. This credit can be used for internet subscription or defray part of the cost to buy new mobile phones. (3) At the same time, telecommunication companies will by provide benefits valued at RM1.5bn ringgit such as free data. Source: 2021 Budget Speech, TA Securities Our View: Positive We view Budget 2021 to have a positive impact on the telecommunications sector. Of note, we view measure (1) [allocation of RM7.4bn to build and upgrade broadband services] to be largely supportive of JENDELA, notably with a key target outlined under the plan being the fiberisation of ~2.5mn premises (including to sub-urban and rural areas) across 2020-2022, which would then see the number of premises with fiber connectivity leap 51.5% from 4.95mn in 2020 to 7.5mn by 2022 (see Appendix 1 & 2). While awaiting clarity on the extent of commitment and involvement by telcos during the roll out phase, essentially, we expect the government’s funding support to bode well for telcos (including Celcom, Digi, Maxis, TIME, TM) as it would enhance the commercial viability of expanding their fixed broadband offerings into sub-urban and rural areas which for long has been underserved due to hefty investments required. That said, we also do not discount the possibility of TM playing a key role in the roll out phase owing to its past experience in rolling out large infrastructure projects like HSBB and SUBB. Meanwhile, we expect measure (2) [allocation of credit worth RM180 to B40 group] to help keep telcos ARPU resilient as the credit should help largely insulate against downside risk of softer affordability from the price sensitive segment especially if prevailing COVID-19 headwinds prolong. For instance, assuming the credit is used solely for internet subscription, averaging out to RM15 per month, it would subsidise ~50% of an average prepaid subscriber’s monthly commitment of RM30 per month. As for measure (3) [allocation of benefits valued at RM1.5bn e.g., free data], while its scope remains unclear, we believe it would be rather similar to the existing free daily 1GB high-speed internet currently provided by telcos until 31 December 2020 but which is confined only to education, productivity, and news. And if such is the case, we expect minimal impact on telcos ARPU as they will still be able to monetise data from other key areas including video streaming and social media which are the key drivers of mobile data consumption. Page 29 of 42
49. 06-Nov20 In all , we reiterate our Neutral stance on the telecommunications sector. We maintain our Buy recommendations on Axiata (TP: RM4.50) and Digi (TP: RM4.50) and Hold on Maxis (TP: RM5.20) and TM (TP: RM4.35). Our top pick for the sector remains Axiata which we like for its regional footprint in growth markets as well as the prospects of unlocking value from its digital and infrastructure businesses. Peers Comparison Price TP (RM) (RM) Axiata 3.20 4.50 Maxis 5.15 5.20 Digi 4.00 TM 4.20 Company Recom. EV/EBITDA (x) EBITDA Growth PE (x) EPS Growth PBV (x) Div. Yield (%) ROE (%) CY20 CY21 CY20 CY21 CY20 CY21 CY20 CY21 CY20 CY21 CY20 CY21 CY20 BUY 5.2 5.0 2.1 3.5 46.7 29.1 -35.4 60.4 1.3 1.3 1.8 2.9 3.8 6.1 HOLD 13.4 12.4 -2.7 7.8 27.3 24.1 -1.5 13.3 5.7 5.6 3.5 3.9 20.9 23.1 4.50 BUY 11.4 11.1 -5.2 2.7 23.9 22.3 -9.7 7.1 48.9 41.5 4.0 4.3 204.7 186.0 4.35 HOLD 5.4 5.1 -5.6 6.2 16.2 15.2 -2.6 6.9 2.2 2.1 3.1 3.3 12.3 12.4 7.5 7.2 -1.3 4.6 26.7 22.8 -10.8 16.7 3.2 3.0 3.1 3.7 13.8 15.5 Weighted average CY21 Appendix 1: Targets under JENDELA (2021-2025) Source: MCMC, TA Securities Page 30 of 42
50. 06-Nov20 Appendix 2 : Planned Projects Under JENDELA (2021-2025) Source: MCMC, TA Securities [ TH E RE M A ININ G OF T H IS P A GE IS IN TE N TI O NA L L Y L E F T BL AN K] Page 31 of 42
51. 06-Nov20 BUDGET 2021 SUMMARY RESILIENT AS ONE , TOGETHER WE TRIUMPH FIRST GOAL: RAKYAT’S WELL-BEING Strategy 1: COVID-19 Pandemic and Public Health Temporary Measures to Reduce the Impact of Coronavirus 2019 (COVID-19) 2020 Act. This Act provides exemption or relief to individuals who are unable to fulfill their contractual obligations such as rent payments due to the spread of the epidemic. Temporary Measures for Government Financing (Coronavirus Disease 2019) Act allows the Government’s statutory debt level to be temporarily raised up to 60 percent of GDP, from 55 percent. The Government proposes to submit amendments to the Schedule of the Act to this esteemed House to raise the ceiling of the COVID-19 Fund, by 20 billion ringgit, to 65 billion ringgit. An additional 1 billion ringgit will be allocated to stem the third wave of COVID-19. This allocation will, among others, cover: o 475 million ringgit for the purchase of reagent, test kits, and consumables for Ministry of Health’s (MOH) usage o 318 million ringgit to provide PPE and hand sanitisers to MOH front liners; o 150 million ringgit to the National Disaster Management Agency to coordinate efforts to fight COVID-19; o 50 million ringgit for the purchase of equipment, laboratory test supplies, and medicine for university teaching hospitals; and o Procure equipment required to resume dental services, virtual clinical services, and preparation of preliminary zone facilities and thermometers at health facilities to meet the Standard Operating Procedures (SOP). The Government has agreed to provide a one-off payment of 500 ringgit in appreciation of the contribution by the MOH frontliners, which is expected to benefit 100 thousand medical staff. The Government has agreed to expand the scope of the tax relief scope for medical treatment expenses covering vaccination expenses such as pneumococcal, influenza and COVID-19. The Government will also increase the tax relief limit on medical expenses for self, spouse and child for serious diseases from 6,000 ringgit to 8,000 ringgit and tax relief limit for expenses on full medical check-up from 500 ringgit to 1,000 ringgit. An allocation of 24 million ringgit will be provided to address this issue, including strengthening the Mental Health, Violence and Injury Prevention, and Substance Abuse Programmes. The Government will broaden the mySalam’s coverage to medical devices such as heart stent or prosthesis. The Government plans to expand the social protection for the B40 group through the Perlindungan Tenang Voucher Programme. The Government will continue the pneumococcal vaccine programme for children with an allocation of 90 million ringgit that is expected to benefit 500 thousand children annually. Strategy 2: Safeguarding the Welfare of Vulnerable Groups Measure 1: Improving Financial Assistance To enhance the welfare of vulnerable groups, the Government has agreed to increase the monthly rate of financial assistance as follows: o The rate for Financial Assistance for Person With Disabilities (OKU) who are Incapable of Work is increased from 250 to 300 ringgit; o The rate for Financial Assistance for Older Persons, Carers of Bedridden Disabled Person (OKU) and Chronically Ill Patient is increased from 350 to 500 ringgit; o The rate for Incentive Allowance for Disabled Workers is increased from 400 to 450 ringgit; and o The rate for Financial Assistance for Children is increased from 100 ringgit per child with a maximum of 450 ringgit per family, to 150 ringgit per child aged seven years to 18 years, or 200 ringgit per child aged six years and below with a maximum of 1,000 ringgit per family. It is hoped this increase will help with childcare and nutritious food. The rate increase involves an allocation of 2.2 billion ringgit, i.e. an additional 700 million ringgit, and will benefit more than 400 thousand beneficiaries. Page 32 of 42
52. 06-Nov20 For the year 2021 , the Government will replace the Bantuan Sara Hidup (BSH) with the Bantuan Prihatin Rakyat (BPR), with higher rates of assistance and income category as follows: o Families with monthly household income of less than 2,500 ringgit and has up to one child will receive assistance of 1,200 ringgit, while households with two or more children will receive assistance of 1,800 ringgit; o Families with monthly household income between 2,501 ringgit to 4,000 ringgit and one child, will receive BPR assistance of 800 ringgit, while households with two or more children will receive assistance of 1,200 ringgit; o The Government will also assist families with monthly household income between 4,001 ringgit and 5,000 ringgit. This category will receive 500 ringgit for those with up to one child, and assistance of 750 ringgit for households with two or more children; and o Single individuals earning 2,500 ringgit and below will receive assistance of 350 ringgit. Not only that, the age limit eligibility for this group has been lowered to 21 years, compared to the condition before this of 40 years. The Government will allocate 1.5 billion ringgit to implement the Jaringan PRIHATIN Programme to alleviate the financial burden of the B40 group in accessing internet services. Measure 2: Alleviating the Rakyat’s Cost of Living The first initiative is the income tax reduction for resident individuals which will be reduced by 1 percentage point for the chargeable income band of 50,001 to 70,000 ringgit. This is estimated to benefit 1.4 million taxpayers. The banks will enhance the TRA to B40 borrowers who are BSH recipients or BPR, and to micro enterprises with loans of up to 150 thousand ringgit. Borrowers in this category will be given the following options: o A moratorium on their instalments for a period of 3 months; or o Reduce their monthly repayment by 50 percent for a period of 6 months The minimum employee EPF contribution rate is reduced from 11 to 9 percent beginning January 2021 for a period of 12 months to increase take-home pay. This will benefit EPF contributors with a potential cash flow of up to 9.3 billion ringgit The facility to withdraw EPF savings from Account 1 on a targeted basis. The amount allowed will be 500 ringgit a month with a total of up to 6,000 ringgit over 12 months. For the year 2021, the Job Search Allowance will be extended by 3 months and the rate will be 80 percent in the first month, 50 percent for the second till the sixth month and subsequently 30 percent for the last three months. The Government will increase the allocation from 150 million to 200 million ringgit for the Community Drumming Programme which will enable the programme to be broadened to cover 34 new areas Measure 3: Assistance to Farmers and Fishermen The allocation for the Rubber Production Incentive will be doubled from 150 million ringgit to 300 million ringgit. An allocation of 1.7 billion ringgit will be provided in the form of subsidy, aid and incentive to farmers and fishermen. This includes paddy price subsidy of 570 million ringgit, subsidy and incentive for paddy crop of 960 million ringgit, including subsidy for Padi Bukit fertilizers of 40 million ringgit. Allowance for fishermen will be increased from 250 ringgit to 300 ringgit per month commencing in the year 2021. The Government will allocate 400 million ringgit to write-off the interest on the settlers’ debt as well as development programmes for settlers to generate additional income. Strategy 3: Generating and Retaining Jobs The Government will implement the Skim Jaminan Penjanaan Pekerjaan (JanaKerja) which will provide 500 thousand new job opportunities including skills development and retraining programmes worth 3.7 billion ringgit. Measure 1: PenjanaKerjaya Incentive (Hiring Incentive) The Government will also continue the hiring incentive programme under PERKESO, which is now known as PenjanaKerjaya with several enhancements such as Incentive for employees earning 1,500 ringgit and above will be enhanced from a flat rate of 800 ringgit per month to 40 percent of monthly income, subject to a maximum incentive of 4,000 ringgit. The formation of a National Employment Council which will be chaired by YAB Prime Minister. This council will coordinate various initiatives cutting across ministries and agencies which create job opportunities, skills enhancement and training for employees. Page 33 of 42
53. 06-Nov20 Measure 2 : Reskilling and Upskilling 150 million ringgit will be allocated for the Ministry of Higher Education professional certification (KPT-PACE) whereby fresh graduates will each be eligible for a voucher worth 3,000 ringgit to pursue a professional certification course at public or private universities. 100 million ringgit to the Human Resources Development Fund (HRDF) to implement trainings in collaboration with private-sector employers. 100 million ringgit to MDEC to transition existing workforce to fill the growing needs in the ICT industry 100 million ringgit to regional corridor authorities, mainly IRDA and SEDIA to provide new skills training to workers badly affected by the closure of borders to foreign tourists. 30 million ringgit to PERHEBAT for entrepreneurship training programmes that will benefit 12 thousand veterans of the Malaysian Armed Forces. Measure 3: MySTEP The Government will introduce MySTEP or Short-term Employment Programme with an allocation of more than 700 million ringgit. Measure 4: Targeted Wage Subsidy The Government will extend the implementation of the Wage Subsidy Program for another three months with a more targeted approach, specifically for the tourism sector, which includes the retail sector at a rate of 600 ringgit per month for workers earning 4,000 ringgit and below. Measure 5: Social Protection To further encourage old-age savings through Private Retirement Scheme (PRS), individual income tax relief of up to 3,000 ringgit on the PRS contributions will be extended until the year of assessment 2025 The Government provided 24 million ringgit for full contributions under the SOCSO Employment Injury Scheme benefitting 100 thousand employees from the following groups Strategy 4: Prioritising the Inclusiveness Agenda Measure 1: Empowering the Bumiputera The Government will continue to pursue efforts to support the Bumiputera development agenda in order to reduce the disparity between races. A total of 6.5 billion ringgit will be allocated to provide access to quality education to Bumiputera institutions such as Majlis Amanah Rakyat (MARA) and Universiti Teknologi MARA (UiTM) to offer specific programmes such as digitalization of TVET learning methods, and upgrading from certificate level programmes to diploma. To boost and empower Bumiputera entrepreneurs: o 510 million ringgit for the purpose of financing Bumiputera SMEs and micro SMEs through TEKUN and PUNB; o 800 million ringgit for capacity building programmes by Bank Pembangunan Malaysia and SME Bank; o 2 billion ringgit allocated to assist the financing of Bumiputera SMEs through Syarikat Jaminan Pembiayaan Perniagaan (SJPP); and o 1.3 billion ringgit for various capacity building programmes, including professional development, Dana Kemakmuran Bumiputera as well as specific programmes or projects specifically for Bumiputeras. Measure 2: Upholding Islam Tenets The Government will also enhance the management of endowment (wakaf) through collaboration between Yayasan Wakaf Malaysia with Federal Government agencies, GLCs and Government Linked Investment Companies (GLIC). Permodalan Nasional Berhad (PNB) through Amanah Saham Nasional Berhad or ASNB will introduce wakaf services to all ASNB unit trust holders. A one-off special payment of 500 ringgit to the Imam, Bilal, Tok Siak. Noja, Merbot, Guru Takmir and Guru Kafa. This special assistance is expected to benefit almost 70 thousand people. Measure 3: Enhancing the Role of Women To empower women entrepreneurs, 95 million ringgit will be provided for special micro credit financing through TEKUN, MARA and Agrobank. Page 34 of 42
54. 06-Nov20 The Government recognises the importance of addressing the issue of domestic violence . To this end, the Government will provide 21 million ringgit to establish a One-Stop Social Support Centre. 10 million ringgit will be provided for cervical cancer screening and subsidy incentives for mammograms to women who are of high risk of breast cancer. Measure 4: Community-based Initiatives For the Chinese community, a total of 177 million ringgit will be provided for programmes to improve educational facilities, housing and the development of new villages, as well as financing facilities through Bank Simpanan Nasional (BSN). For the Indian community, a total of 100 million ringgit is allocated to the Malaysian Indian Transformation Unit (MiTRA) to the elevate the socio-economy status of the Indian community. TEKUN will provide 20 million ringgit specifically for the Skim Pembangunan Usahawan Masyarakat India, SPUMI and 5 million ringgit for entrepreneurship development for other minority communities. The Government will increase the grants to Rukun Tetangga Areas from 4,800 ringgit to 6,000 ringgit each, with an allocation of almost 50 million ringgit. The Government will also allocate 50 million ringgit for repairs, maintenance and small development projects for places of worship in areas under the Local Authority. The Government will continue its emphasis into the well-being of the Orang Asli community. An allocation of 158 million ringgit will be provided. The Government will continue to look after the welfare of the elderly and the disabled through the Home Help Services Programme. In relation to this, the honorarium value for volunteers under this programme will be increased from 150 ringgit to a maximum of 400 ringgit. The Government will also increase the annual financial aid to operate the Senior Citizens Activity Centre (PAWE) managed by Non-Governmental Organisations (NGOs) from 33 thousand ringgit to 50 thousand ringgit. The government will also allocate 170 million ringgit for early childhood education programmes by the Community Development Department or KEMAS. To alleviate the cost of living for the urban B40 groups especially working parents, the Government will establish Community Centers as transit centres for children to attend after school. Measure 5: Enhancing Rural Infrastructure 1.3 billion ringgit to implement rural and inter-village road projects spanning 920 kilometres that benefits more than 290 thousand people. 632 million ringgit allocated for rural and alternative water supply with a target of 4,800 houses. 250 million ringgit provided for rural electricity supply with a target of 1,100 houses. 55 million ringgit for the Home Assistance Programme to the poor which is building new houses and repairing homes with a target of 15 thousand houses. 121 million ringgit to install 27 thousand units of lamps as well as to cover operational and maintenance costs of 500 thousand units of street lights in villages. The Government will broaden mobile banking services in Sabah and Sarawak, modelling after the initiative by the Sarawak State Government. Measure 6: Youth and Sports Development The Government will provide an incentive of 1,000 ringgit per month for up to 3 months to private employers for each new graduate who participates in the apprenticeship program. In addition, employers can also claim a grant of up to 4,000 ringgit for training programs for the apprentices. Towards embracing a cashless society, the Government will credit a one-off 50 ringgit into e-wallet accounts for those aged 18 to 20 years via the eBelia Programme. The Government will allocate 19 million ringgit to implement the Malaysia National Healthy Agenda aimed at strengthening healthy lifestyle to reduce the risk of diabetes, hypertension and obesity. The Government will also provide 103 million ringgit to build, upgrade and maintain sports facilities nationwide. To assist sports industry operators, 20 million ringgit is provided as a soft loan through the TEKUN Sports scheme to ensure continuity of sports facility operators. The tax relief limit for lifestyle is increased from 2,500 ringgit to 3,000 ringgit where the additional 500 ringgit is specifically provided for expenditure related to sports including participating fee for sports competitions. Page 35 of 42
55. 06-Nov20 Strategy 5 : Ensuring the Well Being of the Rakyat The Government will allocate 500 million ringgit to implement the National Digital Network initiative, JENDELA to ensure the connectivity of 430 schools throughout Malaysia covering all states. Online education has become a way of life. In this respect I would like to announce that the GLCs and GLICs will contribute 150 million ringgit into the Tabung CERDIK to provide laptops to 150 thousand students in 500 schools as a pilot project. Measure 2: Access to Quality Education The Ministry of Education continues to receive the largest allocation of 50.4 billion ringgit or 15.6 percent of the total Government expenditure. The Government will improve the Supplementary Meal Plan by providing milk supply daily compared to twice a week currently. An allocation of 420 million ringgit will be provided A total of 800 million ringgit will be provided for the maintenance and repair of Government Schools and Government Aided Schools. An additional cost of 725 million ringgit will be allocated to upgrade buildings and infrastructure in 50 dilapidated schools. Special needs children in schools will also be given attention by the Government. Therefore, to better provide for the special needs stream, 45 million ringgit will be provided for this purpose. A total of 14.4 billion ringgit will be allocated to the Ministry of Higher Education. This includes, 50 million ringgit for infrastructure and equipment replacement in public universities. The Government has allocated 50 million ringgit to upgrade the Malaysian Research & Education Network or MYREN access line to 500Mbps to 10Gbps Government, working with BSN will provide 100 million ringgit to finance the BSN MyRinggit-i COMSIS Scheme which is a laptop loan scheme. The Government will continue to strengthen Technical and Vocational Education and Training or TVET. For 2021, 6 billion ringgit has been allocated for TVET To provide loans to 24 thousand trainees to pursue TVET programs in public and private skills training institutions, 300 million ringgit is provided through the Skills Development Fund Corporation or PTPK The Government will hereby increase the National Dual Training System Plus allowance from 625 to 1,000 ringgit. A total of 29 million ringgit will be allocated to implement TVET programmes under the Ministry of Higher Education including Islamic education and lifelong learning initiatives Measure 3: Increasing Home Ownership Full stamp duty exemption on instruments of transfer and loan agreement for first time home buyers is extended until 31 December 2025. Stamp duty exemption on loan agreements and instruments of transfer given to rescuing contractors and the original house purchasers is extended for another 5 years. 500 million ringgit to build 14 thousand low cost housing units under the Program Perumahan Rakyat. 315 million for the construction of 3,000 units of Rumah Mesra Rakyat by Syarikat Perumahan Nasional Berhad 125 million ringgit for the maintenance of low cost and medium-low stratified housing as well as assistance to repair dilapidated houses and those damaged by natural disasters 310 million for the Malaysia Civil Servants Housing Programme (PPAM). The Government will collaborate with selected financial institutions to provide a Rent-to-Own Scheme. This program will be implemented until 2022 involving 5,000 PR1MA houses with a total value of more than 1 billion ringgit and reserved for first-time home buyers. Measure 4: Public Transport A unlimited monthly travel pass for as low as 5 ringgit will be introduced for children in year 1 to form 6 to commute to school, and for the disabled. The Government is committed to reducing the burden of bus operators. The Government is committed to reducing the burden of bus operators. Sales tax exemption for the purchase of locally assembled bus including air conditioner will be extended for a period of two years effective from 1 January 2021 until 31 December 2022. Page 36 of 42
56. 06-Nov20 Measure 5 : Defending the Nation’s Sovereignty and Security The Ministry of Defence and the Ministry of Home Affairs will be allocated 16 billion ringgit and 17 billion ringgit respectively. To ensure the readiness of the Malaysian Armed Forces, the Government will increase the allocation for maintenance to 2.3 billion ringgit for the year 2021 compared to 2 billion ringgit previously The Government has allocated 27 million ringgit to Cybersecurity Malaysia to increase the country's cyber security. Apart from continuing to maintain the facilities of the existing Rumah Keluarga Angkatan Tentera (RKAT), the Government has also approved the construction of 1000 new units with a total cost of 500 million ringgit. A total of 153 million ringgit will be allocated for including upgrading facilities at the training centre to strengthen the role of RELA. SECOND GOAL: BUSINESS CONTINUITY Strategy 1: Driving Investments The first strategy is to drive investments. To help local companies face future challenges, the Government will act as a facilitator in providing access to investment funds including improving the business environment. Measure 1: Investment in Key Sectors 1 billion ringgit will be provided as a special incentive package for high value-added technology. Among others, this fund aims to support R&D investment in aerospace as well as electronic clusters such as in Batu Kawan, Penang and Kulim, Kedah industrial parks. A High Technology Fund worth 500 million ringgit will be provided by Bank Negara Malaysia (BNM) to support high technology and innovative companies. Relaxation of tax incentive conditions for Principal Hub and the incentive will be extended until 31 December 2022 New tax incentive for the establishment of Global Trading Centre at a concessionary rate of 10 percent for a period of 5 years and renewable for a period of another 5 years Special income tax treatment at a flat rate of 15 percent for a period of 5 years to non-resident individuals holding key positions for strategic new investment by companies relocating their operations to Malaysia under the Pelan Jana Semula Ekonomi Negara (PENJANA) incentive package. To provide space for the study to be completed, the existing tax incentives, due to end this year, will be extended until 2022. The extension includes tax incentives for MRO activities for aerospace, building and repair of ships, Bionexus status and economic corridor developments. A National Development Scheme (NDS) valued at 1.4 billion ringgit by Bank Pembangunan Malaysia will be introduced to support the implementation and development of domestic supply chain and increase the production of local products such as medical devices. The Maritime Development and Logistics Scheme; Sustainable Development Financing Scheme; Tourism Infrastructure Scheme; and Public Transport Fund will be extended until 31 December 2023 A total of 500 million ringgit from these schemes will be designated for Bumiputera entrepreneurs to increase their involvement in the key sectors. Measure 2: Improving the Business Environment 100 million ringgit for the maintenance of the infrastructure of industrial parks; 42 million ringgit under JENDELA to improve internet connectivity in 25 industrial parks Development of a water treatment plant in Kubang Pasu district to support the investment needs of the Kota Perdana Special Boundary Economic Zone project in Bukit Kayu Hitam, Kedah and residents in the area Allocation of 45 million ringgit to meet the water supply needs for the petrochemical sector concentrated in the Gebeng Industrial Zone The Government will implement Authorized Economic Operator or AEO facilities at the national level with the aim of facilitating the AEO accreditation process and expanding AEO to logistics service providers and approved warehouse operators. Page 37 of 42
57. 06-Nov20 Measure 3 : Science, Technology and Innovation To support the development of science and technology, the Government will allocate 400 million ringgit specifically for R&D purposes involving several ministries and agencies. 20 million ringgit will be provided for the Malaysia Techlympics and Science Space programmes to create expertise in the field of AI and robotics among youth. The Government will allocate 100 million ringgit from the proceeds of the Sukuk PRIHATIN for the conduct of research relating to infectious diseases covering vaccine development as well as treatment research and diagnostics. Measure 4: Locally Manufactured Products 25 million ringgit for the Micro Franchise Development and Affordable Franchise programmes as well as Buy Made in Malaysia programme 150 million ringgit for training programmes and sales assistance as well as digital equipment for 100 thousand local entrepreneurs to encourage adoption of e-commerce under the e-Commerce SME and Micro SME Campaign 150 million ringgit to implement the Shop Malaysia Online initiative together with the e-commerce platform to encourage online spending, which will benefit 500 thousand local sellers including the halal products and handicrafts entrepreneurs 35 million ringgit to promote Malaysian-made products and services under the Trade and Investment Mission To encourage manufacturers of pharmaceutical products including vaccines to invest in Malaysia, the Government will provide incentive including preferential tax rate of 0 to 10 percent for 10 years. Strategy 2: Strengthening Key Sectors Measure 1: Empowering the Agriculture Sector The extension of the Community Farming Programme to the semi-urban and rural communities with an allocation of 30 million ringgit. The implementation of the Organic Agriculture Project as a community project with an allocation of 50 million ringgit and is expected to benefit 1,000 communities The implementation of the e-Satellite Farm Programme with an allocation of 10 million ringgit in the form of matching grants up to 30 thousand ringgit to the Pertubuhan Peladang Kawasan (PPK) Funding under the Agrofood Value Chain Modernization Programme of up to 1 million ringgit at a rate of 3.5 percent The implementation of Aquaculture Development Programme with an allocation of 10 million ringgit through matching grants of up to 20 thousand ringgit for micro entrepreneurs Measure 2: Development of the Commodity Sector To continue Malaysian Sustainable Palm Oil Certification or MSPO with an allocation of 20 million ringgit to boost growth and enhance the competitiveness of the country’s palm oil industry. To provide incentive of 16 million ringgit for latex production. This is to encourage latex production, which requires longer working hours compared to production that will be started in Pahang, Terengganu and Kelantan. The Government will provide a revolving fund amounting to 500 million ringgit for the Forest Plantation Development Loan (PPLH) programme. Measure 3: Sustainability of the Tourism Industry The Government will provide training and placements for 8,000 employees of airline companies in Malaysia with an allocation of 50 million ringgit. The Government will also provide employment opportunities for 500 people in the local and Orang Asli communities as tour guides at all national parks to boost the ecotourism segment. 10 million ringgit will be allocated to ensure that national heritage buildings such as the Sultan Abdul Samad Building and Carcosa Seri Negara will continue to be preserved and become tourism icons. The Government will allocate 35 million ringgit to the Malaysia Healthcare Travel Council to enhance the competitiveness of the local health tourism industry. The Government is pleased to announce a Geran Khas Prihatin of 1,000 ringgit that will be given to 20,000 traders and hawkers in Sabah. Page 38 of 42
58. 06-Nov20 Strategy 3 : Prioritising Automation and Digitalisation The Government through BPMB has provided the Industrial Digitalization Transformation Scheme allude at 1 billion ringgit, which aims to boost digitalization activities. In support of automation and modernization, additional funds amounting to 150 million ringgit will be provided under the SME Digitalization Grant Scheme and the Automation Grant. Strategy 4: Enhancing Access to Financing Measure 1: Micro Credit Financing SME Bank will provide Lestari Bumi financing facility scheme with funds amounting to 300 million ringgit. The Government will introduce the National Supply Chain Finance Platform. The platform, named as "Jana Niaga", will benefit SMEs who have cash flow problems due to the long invoice payment period. To support P2P platforms, especially those based on invoice financing, 50 million ringgit will be allocated based on aa matching investments basis. Through PUNB, 230 million ringgit will be allocated as financing to SMEs for working capital, upgrading of automation systems and equipment and expenditure related to the implementation of COVID-19 SOP compliance. Measure 2: Loan Guarantees The Government is pleased to increase the guarantee by up to another 10 billion ringgit, with 2 billion reserved specifically for Bumiputera entrepreneurs. The Government has allocated guarantee of 3 billion ringgit under the Danajamin Prihatin Guarantee Scheme that will be extended until 2021 with improved terms and conditions. To encourage standardised credit lending activities and increase consumer protection, the Consumer Credit Act will be formulated. Measure 3: Alternative Financing To encourage more individual investors to take part in financing through the ECF platform, income tax exemption of 50 percent of the investment amount or limited to 50 thousand ringgit will be given. THIRD GOAL: ECONOMIC ECONOMICRESILIENCE The third goal is economic resilience. This budget will be aligned to the priorities of the Twelfth Malaysian Plan and the SPV2030. Strategy 1: Expansionary Budget The Government will not compromise in protecting lives and livelihoods in battling COVID-19. Thus, total allocation for 2020 is estimated at 314.7 billion ringgit in terms of expenditure, an increase of 17.7 billion ringgit compared to the original projection. The total expenditure for the year 2021 is the largest expenditure in history with a value of 322.5 billion ringgit. The Government intends to allocate 236.5 billion ringgit for operating expenses, 69 billion ringgit for development expenditure and 17 billion ringgit under the COVID-19 Fund. Measure 1: Expenditure with High Multiplier Effect A total of RM2.5 billion has been allocated for contractors in Class G1 to G4 to carry out small and medium projects across the country including additional 200 million ringgit for maintenance projects for Federal Roads and 50 million for PPR houses. The government through MARA will also provide 50 million ringgit as financing access to construction contractors under the Skim Pembiayaan Kontrak Ekspres, SPiKE. Page 39 of 42
59. 06-Nov20 Measure 2 : Sustainability of Government’s Revenue Effective from 1 January 2021, the Government will implement the following measures: o Freezing the issuance of new import license for cigarette; o Tightening the renewal of import license for cigarette through review of license conditions including the imposition of import quota; o Limiting transshipment of cigarette to dedicated ports only; o Imposition of tax on the importation of cigarettes with drawback facilities for re-export; o Disallow transshipment of cigarettes and re-export of cigarettes by small boats including kumpit and instead be allowed only in ISO containers; and o Making cigarettes and tobacco products as taxable goods in all Duty Free Islands and any free zones that have been permitted retail sale of duty free cigarettes. The Government will impose excise duty of 10 percent on devices for all types of electronic and non-electronic cigarettes including vape effective from 1 January 2021. Strategy 2: Development Agenda under the 12th Malaysia Plan Measure 1: Transport Infrastructure Development Government is committed to implement transport infrastructure project to increase the mobility of rakyat. In 2021, 15 billion ringgit will be allocated to fund the Pan Borneo Highway, Gemas-Johor Bahru Electrified Double-Tracking Electrified Project and Klang Valley Double Tracking Project Phase One. Several key projects will also be continued such as Rapid Transit System Link from Johor Bahru to Woodlands, Singapore and MRT3 in Klang Valley. The Government will also continue the High-Speed Rail Project or HSR as this project is expected to generate a positive multiplier effect to the country's economy. However, it is subject to further discussion with Singapore. There are also several large new projects worth approximately 3.8 billion ringgit that will be implemented as follows: o Construction of the Second Phase of the Klang Third Bridge in Selangor o Continuing the Central Spine Project with the new alignment from Kelantan to Pahang; o Upgrading the bridge across Sungai Marang, Terengganu; o Upgrading of Federal Road connecting Gerik, Perak to Kulim, Kedah o To continue building and upgrading Phase of the Pulau Indah, Klang Ringroad Phase 3, Selangor o Construction of the Pan Borneo Highway Sabah from Serusop to Pituru; and o Construction of the Cameron Highlands Bypass road, Pahang with emphasis on preserving the environment. Measure 2: Balanced Regional Development For the five regional corridors of economic development, development projects will be continued with an allocation of 780 million ringgit for year 2021 including: Rapid Transit Bus Transport System at 3 High Capacity Routes and construction of busway at IRDA in Johor; Construction of the Palekbang Bridge to Kota Bahru, Kelantan under ECER; Construction of infrastructure and related components of the Special Development Zone project in Yan and Baling, Kedah under NCER; Infrastructure Project in the Samalaju Industrial Area, Sarawak under SCORE; and Continuation of the Sapangar Bay Container Port Expansion Project, Sabah under SDC. An allocation of 150 million ringgit will be allocated for the Raw Water Transfer Project from Sungai Kesang and Tasik Biru to the Jus Reservoir, Jasin, Melaka. For the year 2021, Sabah and Sarawak will receive Development Expenditure allocation of 5.1 billion ringgit and 4.5 billion ringgit respectively. Strategy 3: Enhancing the Role of GLC and Civil Society 50 million ringgit for income generation and employment promotion initiatives for the vulnerable 30 million ringgit for initiatives to address social issues 20 million ringgit for environmental conservation initiatives. The Government will conduct a social enterprise development program with an allocation of 20 million ringgit to the Malaysian Global Innovation and Creativity Center or MaGIC and selected agencies. Page 40 of 42
60. 06-Nov20 Strategy 4 : Ensuring Resource Sustainability Measure 1: Sustainable Development Agenda The Government through cooperation with the United Nations will establish the Malaysia-SDG Trust Fund or MySDG Trust Fund with an initial allocation of 20 million ringgit. The Government also supports the SDG programs implemented by the Malaysian Parliamentary Party Cross Group with an allocation of 5 million ringgit Measure 2: Sustainable Finance The Government will now issue its first Sustainability Bond in Malaysia for environmental and social initiatives in 2021. To further encourage the issuance of Sustainable and Responsible Investment (SRI) products and bonds that achieve green, social and sustainable standards in Malaysia, the existing income tax exemption for SRI Green sukuk grant is extended to all types of sukuk and bonds and this exemption is extended until 2025. The Government will also continue the Green Technology Financing Scheme 3.0 or GTFS3.0 with a fund size of 2 billion ringgit for two years up to 2022 which will be guaranteed by Danajamin to encourage the issuance of SRI sukuk. Measure 3: Environmental Conservation 50 million ringgit provided to address waste and solid waste trapped in rivers 40 million ringgit provided over a period of five years to strengthen environmental quality monitoring enforcement activities including the establishment of 30 monitoring stations nationwide 10 million ringgit provided to implement the Integrated Island Waste Management project around the islands in Johor and Terengganu to reduce the effects of coral reef destruction and marine life. Increase the allocation under the TAHAP to all State Governments from 350 million to 400 million ringgit. Implement mangrove tree planting programs to preserve mangrove swamp areas and other tree species along the coast including Tanjung Piai, Johor and Kuala Sepetang, Perak The SAVE 2.0 program will be introduced which is an e-Rebate of 200 ringgit to households who buy any energy efficient locally manufactured air conditioner or refrigerator. The Government will strengthen the Biodiversity Protection and Patrol Program by recruiting more than 500 former military and police personnel as well as Orang Asli for patrolling activities. Strategy 5: Civil Service Measure 1: Strengthening of the Public Service Delivery The Government will also allocate 14 million ringgit to upgrade infrastructure and information and communication technology facilities in the Ministry of Foreign Affairs as well as digitalisation of the Malaysian consular services abroad. Measure 2: Strengthening Governance and Integrity in Malaysia The Government will ensure that all initiatives contained in the National Anti-Corruption Plan, NACP are implemented and recruitment of additional l00 SPRM officers will be continued as well as ensuring anti-corruption education is applied at all levels. Special provision is provided as a reward to anyone who can provide information on any misconduct and violations of the law. Measure 3: Welfare of the Civil Servants To improve the facilities provided to the civil servants, the following initiatives will be implemented: o Increase the allowance rate from 6 ringgit to 8 ringgit per hour to more than 1,900 Auxiliary Bomba officers from 2021; and o Introducing a free Personal Accident Protection Scheme of up to 100 thousand ringgit to new borrowers of the Public Sector Home Financing Board (LPPSA) for the years 2021 and 2022; o In appreciation of the services and duty rendered by the civil servants, the Government is pleased to announce a Special Financial Assistance of 600 ringgit to be paid to all civil servants Grade 56 and below. For the retirees and non-pensionable veterans, a Special Financial Assistance of 300 ringgit will be paid. Both assistances will be paid in early 2021. Page 41 of 42
61. 06-Nov20 (TH I S P A GE IS IN TE N TI ON AL L Y L E F T B L AN K ) Sector Recommendation Guideline OVERWEIGHT: The industry, as per our coverage universe, is expected to outperform the FBMKLCI over the next 12 months. NEUTRAL: The industry, as per our coverage universe, is expected to perform in line with the FBMKLCI over the next 12 months. UNDERWEIGHT: The industry, as per our coverage universe, is expected to underperform the FBMKLCI over the next 12 months. 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 and/ 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. As of Saturday, November 07, 2020, the analyst, Kaladher Govindan, Ooi Beng Hooi, Thiam Chiann Wen, Chan Mun Chun, Wilson Loo Jia Chern, Tan Kong Jin and Jeff Lye Zhen Xiong who prepared this report, has interest in the following securities covered in this report: (a) nil Kaladher Govindan – Head of Research TA SECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048 www.ta.com.my Page 42 of 42
62. COMPANY UPDATE Monday , November 09, 2020 FBMKLCI: 1,519.64 Sector: Oil and Gas THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* TP: RM2.10 (+38.2%) Serba Dinamik Holdings Bhd Last Traded: RM1.52 Busy with New Major Projects Kylie Chan Sze Zan Tel: +603-2167 9601 BUY kyliechan@ta.com.my Serba Dinamik’s (Serba)’s management updated on its recent projects, including: (1) Block 7: Physical construction works will start in mid-21 – this will culminate in peak working capital requirements (~RM500mn) in 2022, (2) Teluk Ramunia yard: In FY20-21, the yard will be partially leased out and execute RM150mn-200mn of existing orders - this will result in breakeven profits (yard utilization: 50%), and (3) Bintulu Integrated Energy Hub: This centre will execute existing locked-in orders upon its launch in 2Q21 –whilst awaiting potential EPC jobs from the upcoming Sarawak Petrochemical Hub. We maintain Buy on Serba on the back of earnings and orderbook resilience. Our target price (TP) of RM2.10 is based on 10.5x CY21 P/E. Resilient Orderbook Insulated from Upstream O&G Capex Cuts. Serba’s current outstanding orderbook of RM18.5bn (Figures 1 & 2) remains resilient. To-date, no clients have requested for discounts, contract cancellations, or delayed execution. Management attributes this to the fact that it has marginal exposure (10%-20%) to offshore O&G upstream projects (Figure 2). To recap, Serba’s contracts mainly consist of O&G downstream and utilities (i.e. power and water plants) projects. Additionally, the Group is also involved in ICT (Information Communications & Technology) and chemical projects. Therefore, Serba is largely insulated from major upstream capex cuts implemented by oil majors. On the flip side, new tenders submitted by Serba have whittled down to 5-10 monthly bids (previous: 10-15 bids). This is partly attributed to prolonged period for tender evaluation due to Covid-19 interruptions. Nevertheless, Serba’s existing orderbook, translates to robust earnings visibility until end-2022. To recap, the Group has current tender book of circa RM20bn. www.taonline.com.my Share Information Bloomberg Code SDH MK Stock Code 5279 Listing Main Market Share Cap (mn) 3,371.6 Market Cap (RMmn) 5,124.8 52-wk Hi/Lo (RM) 2.52/1.02 12-mth Avg Daily Vol ('000 shrs) 11,312 Estimated Free Float (%) 33.0 Beta 1.8 Major Shareholders (%) Mohd Abdul Karim - 26.8 Abdul Kadier Sahib - 17.6 EPF - 9.6 Forecast Revision FY20 FY21 0.0 0.0 Forecast Revision (%) 592.3 685.4 Net profit (RMm) Consensus 578.8 665.5 102 103 TA's / Consensus (%) Buy (Maintained) Previous Rating Financial Indicators Net Debt / Equity (x) ROA (%) ROE (%) NTA/Share (RM) Price/NTA (x) FY20 0.8 7.7 20.7 0.8 1.8 FY21 0.9 7.8 20.3 1.0 1.5 SDH (6.2) (11.1) (5.0) (25.2) FBM KLCI 0.7 (4.3) 10.4 (5.2) Share Performance (%) Block 7 Firing its Engines. Serba is kick starting the blockbuster contract win of 2020, namely the USD1.8bn (RM7.7bn) Block 7 contract in Abu Dhabi, UAE. To recap, this project (completion: 2024) comprises Engineering, Procurement and Construction (EPC) of an innovation hub, academic campus, accommodation facilities, and IT infrastructure. Serba has sent its project team to the site and is currently executing detailed engineering design. Additionally, the Group has appointed a project consultant, and will engage with local subcontractors to fulfil local content requirements. Meanwhile, Block 7 Investments LLC, which is spearheading this project, is currently in advanced talks with a syndicate of international (i.e. HSBC, Standard Chartered) and local UAE banks to secure financial close for this development (target: 1Q21). Management understands that the Abu Dhabi government may also enter as a stake holder for Block 7. If this materializes, it will enhance confidence and willingness of banks to participate. Price Change 1 mth 3 mth 6 mth 12 mth (12-Mth) Share Price relative to the FBMKLCI Source: Bloomberg Page 1 of 6
63. 9-Nov-20 Figure 1 : Orderbook Breakdown by Segment Figure 2: Orderbook Breakdown by Industry 20,000 18,000 Power Water & Utiiities, 5%Plants, 5% Chemicals, 4% 1,850 Orderbook (RM k) 16,000 14,000 12,000 7,400 O&G, 40% ICT 10,000 O&M 8,000 EPCC 6,000 4,000 9,250 Others, 46% 2,000 Source: Company, TA Securities Source: Company, TA Securities Spearheaded by Gulf Juggernaut. Management revealed that the Block 7 project (Figure 3) is led by renowned Gulf businessman, HE. Eng. Salah Salem Al-Shamsi. He is the Chairman of LIWA Group, which is one of the leading general trading companies based in Abu Dhabi. LIWA supplies chemicals, engineering products and major equipment to industries such as O&G, utilities, petrochemicals and construction. Salah Salem is also one of the members of United Arab Emirates (UAE) royal family, and a key figure behind the establishment of Abu Dhabi National Oil Company (ADNOC). Lastly, Salah Salem spearheaded the development of Saadiyat Island at Abu Dhabi (acreage: 27km2) in 1999 This resort island is a world-class tourism-cultural hub with leisure, residential, business and cultural components. This reinforces his track record in development of major infrastructure projects, similar to Block 7. Bulk of Revenue Will Flow-In by Mid-2021. Development of Block 7 will be spread over four phases. Meanwhile, physical construction works for Block 7 are slated to commence in mid-2021. Correspondingly, the bulk of project revenue will be recognized during this phase. Additionally, working capital requirements are expected to peak later in 2022 to RM500mn p.a. Management is confident of funding this via internal monies, claims invoiced to Block 7, and debt financing (i.e. unutilized i-Sukuk and credit facilities totalling RM2.3bn). Given the robust gross profit margin of 20% for this project, management may even plough back profits to fund working cap. Teluk Ramunia Yard Also Ramping Up. Petronas has handed over Teluk Ramunia (TR) yard to Serba. Recall that the Group acquired this fabrication yard (capacity: 50k tonnes) in Johor back in June-20. Currently, the Group is conducting cleaning works on the yard areas, which will take approximately 3-4 weeks for completion. Thereafter, Serba will commence repair and restoration works on the yard facilities. For FY20-21, this yard will execute works valued at RM150mn-200mn from Serba’s existing orderbook. In addition, part of the yard facilities will also be leased out to generate immediate revenue. We understand that only a small portion (less than 10% acreage) of the yard (total area: 170 acres) will be rented out on long term basis. As such, management expects the yard to breakeven in FY20-21 on the back of 50% utilization. In the worst-case scenario, the Group estimates payback period of 5 years on Return of Investment (ROI) for this yard. Page 2 of 6
64. 9-Nov-20 TR Yard Aiming for Qatari Jobs . At this early juncture, TR yard will target select offshore works such as Transportation & Installation (T&I) and decommissioning works. Thereafter, upon obtaining a fabrication license from Petronas, Serba will aim for mid-sized fabrication jobs (e.g. jackets, turrets). Therefore, the Group will not compete against established yards (i.e. Sapura Energy and MMHE) for large sized modules (e.g. topsides). Additionally, TR yard will not only bid for local jobs, but also aim for projects originating from the Middle East, particularly Qatar. According to management, Qatar is unable to secure yard capacity in Mid-East due to ongoing sanctions arising from the Qatar-Gulf diplomatic crisis. Therefore, Qatar has placed large fabrication orders at yards in Batam, Indonesia. Given TR’s close proximity to Batam, and coupled with Serba’s established track record with Mid-East clients, TR may likely enjoy spillover orders from Qatar. Targeting Pengerang Phase 2 EPCC Projects. Management is eyeing potential EPCC (Engineering, Procurement, Construction and Commissioning) opportunities brewing at Pengerang, Johor for TR yard. This is for Johor Petroleum Development Corp’s (JPDC) Pengerang Integrated Petroleum Complex (PIPC) project. This is on the back of the impending launch of PIPC Phase 2 following successful completion of Pengerang Integrated Complex (PIC) and Pengerang Deepwater Terminal (PDT) in 2019. To recap, PIC and PDT comprises the main components of Phase 1. PIC includes Petronas Chemicals’ RAPID (Refinery and Petrochemicals Integrated Development) project and Petronas Gas’ LNG terminal. Meanwhile, PDT comprises Dialog’s storage facilities. Given that EPCC works for PIPC Phase 1 works were executed at TR Yard, we believe Serba could leverage on its prior track record and proximity to Pengerang. Eyeing Petrochemical Projects at Bintulu. Similarly, Bintulu Integrated Energy Hub (BiEH) is also targeting EPC jobs for new petrochemical plants. To recap, Sarawak Economic Development Corporation (SEDC) has kick-started Sarawak Petrochemical Hub (SPH) (acreage: 1,068 acres) in Tanjung Kidurong, Bintulu. It is surrounded by other O&G facilities such as Petronas LNG complex, Shell MDS (gas to liquids plant), and a mega methanol plant currently under development. The Economic Planning Unit Sarawak (EPUS) is undertaking a joint study with Petronas, SPH’s masterplan. Nevertheless, pending the takeoff of SPH jobs, BiEH (launch: 2Q20) will be busy executing locked-in orders secured earlier. Serba will likely secure BiEH’s operating permit in time for its targeted launch in Nov-20. Following this, BiEH will likely close-down two out of three of its leased service centres at Bintulu. This is after transferring machinery and equipment to BiEH in phases. The latter exercise will likely be completed by end-Dec 2020. Nevertheless, Serba will likely retain one existing service centre owned by the Group. Page 3 of 6
65. 9-Nov-20 Figure 3 : Block 7 Innovation Factory/ Hub Source: Company, TA Securities Figure 4: Bintulu Integrated Energy Hub (BiEH) Source: Company, TA Securities Buy on Attractive Valuations & Resillient Earnings. We maintain Buy on Serba on the back of earnings resilience. This is underpinned by: (1) core business (90% of 2015-19 operating profits) consists of evergreen recurring O&M services, (2) current orderbook of RM18.5bn translates to robust earnings visibility up to 2023, (3) rising traction in Serba’s thrust to diversify into ICT – as evident from its ballooning RM1.85bn ICT orderbook (10% of outstanding orderbook), and (4) diversification away from O&G (orderbook exposure: 40%) guards earnings against oil price fluctuations. Furthermore, current valuations appear attractive, whereby the stock is currently trading at 1SD CY21 P/E (historical peak/low: 14.7x / 6.2x). Our target price (TP) of RM2.10 is based on 10.5x CY21 P/E. Page 4 of 6
66. 9-Nov-20 Earnings Summary Income Statement Balance Sheet FYE 31 Dec (RMmn) Revenue 2018 2019 2020E 2021F 2022F FYE 31 Dec (RMmn) 3,283.2 4,528.6 5,365.0 7,320.0 8,195.0 PPE Core EBITDA 559.1 834.2 896.6 1,027.4 1,111.4 JV & Associates Depreciation (89.9) (142.7) (134.6) (130.7) (139.1) Others Net finance cost (49.6) (182.8) (140.7) (154.7) (188.1) Non-Current Assets Associate & JV 13.9 35.0 38.5 38.9 39.3 4.2 1.1 (1.1) 0.0 0.0 437.6 544.8 781.0 823.5 Forex & EI PBT Taxation & Zakat MI 658.7 (44.8) (46.8) (65.9) (93.7) (98.8) (1.4) (1.3) (1.6) (1.9) (2.0) Net Profit 391.5 496.6 591.2 685.4 722.7 Core Net Profit 387.3 495.5 592.3 685.4 722.7 2019 2020E 2021F 2022F 1,273.1 1,928.7 2,313.2 2,482.5 2,643.4 305.9 391.8 430.3 469.3 508.6 7.4 18.6 18.6 18.6 18.6 1,586.4 2,339.1 2,762.1 2,970.4 3,170.5 Inventories 848.3 919.6 1,204.7 1,673.8 1,792.7 Trade receivables 957.3 1,265.2 1,599.3 2,120.5 2,368.8 Cash and equivalents 760.8 1,306.6 1,625.1 1,530.4 1,761.2 Others 218.0 523.8 523.8 523.8 523.8 Current Assets 2,784.3 4,015.1 4,953.0 5,848.4 6,446.5 TOTAL ASSETS 4,370.8 6,354.2 7,715.1 8,818.8 9,617.0 1,107.5 2,946.7 3,562.2 3,913.9 4,089.7 86.5 46.7 46.7 46.7 46.7 1,194.0 2,993.4 3,608.8 3,960.5 4,136.4 LT Borrowings Per Share Data 2018 Others Core EPS* (sen) 11.7 14.8 17.6 20.3 21.4 Non-Current Liabilities DPS (sen) 3.8 3.6 5.0 5.0 6.0 Trade payables 426.5 452.5 689.1 874.2 950.0 BVPS (RM) 0.6 0.7 0.8 1.0 1.2 ST Borrowings 604.0 404.7 489.3 537.6 561.7 NTA/Share (RM) 0.6 0.7 0.8 1.0 1.2 Others 54.0 63.7 63.7 63.7 63.7 1,084.5 920.9 1,242.1 1,475.5 1,575.5 1,344.3 1,344.3 1,344.3 1,344.3 1,344.3 743.8 1,088.4 1,511.0 2,027.8 2,548.3 4.1 7.2 8.8 10.6 12.6 Current Liabilities Ratios Share Capital FYE 31 Dec (RMmn) 2018 2019 2020E 2021F 2022F Valuations Reserves MI Core PER (x) 13.0 10.3 8.7 7.5 7.1 Total Equity 2,092.3 2,439.9 2,864.1 3,382.8 3,905.2 Div. Yield (%) 2.5 2.4 3.3 3.3 3.9 TOTAL E&L 4,370.8 6,354.2 7,715.1 8,818.8 9,617.0 P/BV (x) 2.4 2.1 1.8 1.5 1.3 FCF Yield (%) (9.7) (13.1) (1.6) (3.6) 7.9 Profitability ratios Cash Flow Statement FYE 31 Dec (RMmn) 2018 2019 2020E 2021F 2022F Pretax profit 437.6 544.8 658.7 781.0 823.5 Core EBITDA margin (%) 17.0 18.4 16.7 14.0 13.6 Depreciation 89.9 142.7 134.6 130.7 139.1 Core EBIT margin (%) 14.3 15.3 14.2 12.3 11.9 Net interest 49.6 182.8 140.7 154.7 188.1 PBT margin (%) 13.3 12.0 12.3 10.7 10.0 JV & Associate (13.9) (35.0) (38.5) (38.9) (39.3) Core Net Margin (%) 11.8 10.9 11.0 9.4 8.8 Changes in WC (454.9) (578.0) (382.7) (805.1) (291.4) Core ROE (%) 18.5 20.4 20.7 20.3 18.6 (98.8) Core ROA (%) 8.9 7.8 7.7 7.8 7.5 Tax (44.8) (46.8) (65.9) (93.7) Others 19.7 2.1 0.0 0.0 0.0 Operational cash flow 83.2 212.6 446.9 128.5 721.2 (551.9) (868.2) (519.1) (300.0) (300.0) 12.5 21.5 25.8 36.6 39.4 0.0 0.0 0.0 0.0 0.0 Liquidity ratios Current ratio (x) 2.6 4.4 4.0 4.0 4.1 Capex Quick ratio (x) 1.8 3.4 3.0 2.8 3.0 Interest income Investment in JV/Associate Leverage ratios Others Equity/total liabilities (x) 0.6 0.3 0.3 0.2 0.2 Net debt / equity (x) 0.5 0.8 0.8 0.9 0.7 Growth ratios Revenue (%) 20.6 37.9 18.5 36.4 12.0 Core Net Profit (%) 27.1 28.0 19.5 15.7 5.4 Investing cash flow Orderbook Replenishment *Adjusted for bonus issue & share split 7,000 0.0 0.0 0.0 (493.3) (263.4) (260.6) 416.2 0.0 0.0 0.0 0.0 Dividend paid (107.2) (141.4) (168.6) (168.6) (202.3) Net borrowings 185.6 437.2 700.0 400.0 200.0 Interest paid (62.1) (204.3) 364.9 (191.3) (227.6) 810.3 1,220.1 0.0 0.0 0.0 1,242.7 1,311.6 364.9 40.1 (229.9) Net cash flow 467.3 633.4 318.5 (94.7) 230.8 Beginning Cash 158.5 631.5 1,306.6 1,625.1 1,530.4 5.7 0.0 0.0 0.0 0.0 631.5 1,264.9 1,625.1 1,530.4 1,761.2 Financial cash flow 12,000 (44.1) (890.8) Issue of shares Others Key Assumptions (319.2) (858.6) 6,000 Forex End Cash Page 5 of 6
67. 9-Nov-20 (TH I S P A GE IS IN TE N TI ON AL L Y L E F T B L AN K ) 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 and/ 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. As of Monday, November 09, 2020, the analyst, Kylie Chan Sze Zan, who prepared this report, has interest in the following securities covered in this report: (a) nil Kaladher Govindan – Head of Research TA SECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048 www.ta.com.my Page 6 of 6
68. Monday , 09 November, 2020 TA RESEARCH’S ‘DAILY COMPILED REPORTS’ For Internal Circulation Only L oc al Te ch n ic al R ep o r ts 1. Weekly Technical Stock Watch 2. Daily Money Flow of Technical Stock Watch 3. Technical Stock Watch a. FBMKLCI 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 and/ 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. Kaladher Govindan – Head of Research TA SECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048 www.ta.com.my
69. Technical View Monday , November 09, 2020 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Weekly Technical Stock Watch Malaysia Chartist: Stephen Soo Tel: +603-2167 9607 stsoo@ta.com.my GAMUDA (5398) RM3.69 BOLLINGER BANDS Upper Middle Lower RM RM RM SIMPLE MOVING AVERAGES 3.62 3.45 3.29 10-day 30-day 50-day RM RM RM BUY BUY Recent Signal Signal Change DMI SIME DARBY (4197) RM RM RM BUY BUY RM2.47 BOLLINGER BANDS SIMPLE MOVING AVERAGES 2.48 2.42 2.36 10-day 30-day 50-day BUY BUY Recent Signal Signal Change DMI Recent Signal Signal Change 3.41 3.44 3.44 DAILY MACD Recent Signal Signal Change Upper Middle Lower www.taonline.com.my RM RM RM 2.42 2.41 2.36 DAILY MACD SELL Page 1 of 10
70. 9-Nov-20 GLOBETRONICS (7022) RM2.97 BOLLINGER BANDS Upper Middle Lower RM RM RM SIMPLE MOVING AVERAGES 3.04 2.82 2.60 10-day 30-day 50-day RM RM RM BUY BUY Recent Signal Signal Change DMI DAILY MACD Recent Signal Signal Change INARI AMERTRON (0166) RM RM RM SIMPLE MOVING AVERAGES 2.67 2.53 2.39 10-day 30-day 50-day BUY Recent Signal Signal Change DMI Recent Signal Signal Change SELL RM2.68 BOLLINGER BANDS Upper Middle Lower 2.87 2.76 2.76 RM RM RM 2.56 2.45 2.34 DAILY MACD SELL Page 2 of 10
71. 9-Nov-20 MPI (3867) RM23.78 BOLLINGER BANDS Upper Middle Lower RM RM RM SIMPLE MOVING AVERAGES 23.65 20.89 18.12 10-day 30-day 50-day RM RM RM BUY Recent Signal Signal Change DMI DAILY MACD Recent Signal Signal Change SKP RESOURCES (7155) RM RM RM SIMPLE MOVING AVERAGES 1.91 1.83 1.74 10-day 30-day 50-day DMI Recent Signal Signal Change BUY RM1.89 BOLLINGER BANDS Upper Middle Lower 22.03 20.16 18.95 RM RM RM 1.81 1.82 1.73 DAILY MACD BUY BUY Recent Signal Signal Change SELL Page 3 of 10
72. 9-Nov-20 UNISEM (5055) RM6.09 BOLLINGER BANDS Upper Middle Lower RM RM RM Recent Signal Signal Change SIMPLE MOVING AVERAGES 5.96 4.55 3.14 10-day 30-day 50-day RM RM RM DAILY MACD BUY Recent Signal Signal Change VS INDUSTRY (6963) RM RM RM SIMPLE MOVING AVERAGES 2.51 2.39 2.27 10-day 30-day 50-day DMI Recent Signal Signal Change BUY RM2.44 BOLLINGER BANDS Upper Middle Lower 5.15 4.24 3.96 RM RM RM 2.37 2.34 2.18 DAILY MACD BUY Recent Signal Signal Change SELL Page 4 of 10
73. 9-Nov-20 Close Name 6 /Nov FBMKLCI 1519.64 Change High Low 18.15 1,519.64 1,497.32 Bollinger Bands RSI Lower Mid Upper 14d 10d Moving Averages 30d 50d DI + DI - DMI ADX Diff Line MACD Signal Diff Recent Signal DMI MACD 1,458.61 1,500.02 1,541.43 51.37 1,484.45 1,501.31 1,508.11 22.32 26.39 24.69 (4.08) (10.34) (8.83) (1.52) SELL DMI MACD Signal Change SELL - - AFFIN 1.40 0.01 1.42 1.39 1.35 1.39 1.42 48.89 1.37 1.39 1.41 13.47 15.44 30.39 (1.97) -0.01 -0.02 0.00 SELL BUY - BUY ABMB 2.29 0.03 2.29 2.26 2.17 2.23 2.29 56.63 2.23 2.22 2.20 35.61 17.00 30.56 18.60 0.01 0.01 (0.00) BUY SELL - - AMBANK 3.00 0.07 3.00 2.94 2.80 2.92 3.03 50.92 2.90 2.93 2.96 18.77 21.41 21.86 (2.63) -0.03 -0.03 (0.01) SELL SELL - - AXIATA 3.20 0.15 3.20 3.06 2.64 2.87 3.10 58.41 2.91 2.89 2.97 27.47 16.64 24.10 10.83 0.00 -0.03 0.03 BUY BUY - - CIMB 3.10 0.04 3.10 3.05 2.92 3.04 3.16 51.07 3.00 3.05 3.12 21.60 20.77 14.43 0.83 -0.04 -0.05 0.00 BUY BUY BUY BUY DIGI 4.00 0.03 4.03 3.95 3.74 3.97 4.20 50.64 3.89 3.98 4.03 16.99 21.20 22.87 (4.22) -0.06 -0.05 (0.01) SELL SELL - - GAMUDA 3.69 0.09 3.69 3.55 3.29 3.45 3.62 60.53 3.41 3.44 3.44 25.14 16.50 14.93 8.64 -0.01 -0.01 0.01 BUY BUY BUY BUY GENTING 3.06 0.07 3.08 2.98 2.86 3.03 3.20 36.35 2.98 3.08 3.24 17.99 25.98 30.90 (8.00) -0.08 -0.09 0.01 SELL BUY - - GENM 2.11 0.05 2.11 2.05 1.97 2.03 2.09 50.93 2.02 2.05 2.12 24.95 18.93 14.76 6.02 -0.02 -0.03 0.01 BUY BUY - - IHH 5.27 -0.01 5.28 5.25 4.88 5.05 5.22 59.50 5.11 5.07 5.19 23.25 17.30 19.48 5.96 -0.01 -0.04 0.03 BUY BUY BUY - IOICORP 4.45 0.00 4.46 4.40 4.22 4.36 4.51 54.99 4.37 4.39 4.42 14.03 19.63 28.70 (5.60) -0.01 -0.02 0.01 SELL BUY - - MALAKOFF 0.91 0.01 0.92 0.91 0.89 0.91 0.94 41.25 0.91 0.92 0.95 9.07 11.41 10.84 (2.34) -0.01 -0.01 (0.00) SELL SELL - - MAXIS 5.15 0.13 5.15 4.98 4.81 4.97 5.12 53.75 4.93 4.97 5.01 20.80 18.54 13.50 2.26 -0.03 -0.03 0.00 BUY BUY BUY BUY MAYBANK 7.18 0.10 7.19 7.06 6.90 7.15 7.40 44.86 7.05 7.14 7.22 13.93 19.05 16.97 (5.12) -0.06 -0.06 (0.00) SELL SELL - - MBSB 0.52 0.01 0.52 0.51 0.49 0.50 0.52 50.71 0.50 0.51 0.52 14.21 19.80 37.70 (5.59) -0.01 -0.01 0.00 SELL BUY - BUY - RHBBANK 4.35 0.04 4.36 4.28 4.17 4.34 4.52 43.63 4.29 4.41 4.52 8.62 17.74 33.61 (9.12) -0.08 -0.08 0.01 SELL BUY - SIME 2.47 0.05 2.47 2.40 2.36 2.42 2.48 52.25 2.42 2.41 2.36 15.82 15.30 21.82 0.53 0.02 0.02 (0.01) BUY SELL BUY - 10.30 0.24 10.34 10.00 9.51 9.97 10.43 48.73 9.81 10.16 10.53 25.44 25.16 37.15 0.28 -0.23 -0.25 0.02 BUY BUY BUY BUY TENAGA TM 4.20 0.00 4.27 4.17 4.11 4.19 4.27 53.36 4.19 4.16 4.16 16.61 18.33 16.78 (1.72) 0.01 0.02 (0.01) SELL SELL - - WPRTS 3.94 -0.01 3.99 3.86 3.78 3.89 3.99 55.20 3.88 3.89 3.90 18.59 17.59 13.94 1.00 0.00 -0.01 0.01 BUY BUY BUY BUY AEMULUS 0.70 0.00 0.71 0.69 0.63 0.68 0.73 55.38 0.68 0.67 0.67 34.19 18.77 34.76 15.42 0.01 0.01 (0.00) BUY SELL - - ARMADA 0.24 0.00 0.24 0.23 0.21 0.24 0.26 50.25 0.23 0.24 0.25 23.18 18.54 20.14 4.64 -0.01 -0.01 0.00 BUY BUY - BUY DIALOG 3.80 -0.03 3.80 3.73 3.61 3.73 3.85 59.88 3.70 3.75 3.74 24.77 12.58 20.94 12.19 -0.02 -0.02 (0.00) BUY SELL BUY - DNEX 0.21 0.02 0.22 0.20 0.17 0.19 0.22 51.70 0.19 0.19 0.20 28.30 16.80 23.84 11.50 0.00 0.00 0.00 BUY BUY - BUY FGV 1.15 -0.03 1.20 1.15 1.01 1.08 1.14 60.84 1.07 1.09 1.14 32.73 17.24 15.63 15.49 -0.01 -0.02 0.01 BUY BUY BUY BUY GADANG 0.40 -0.01 0.41 0.40 0.36 0.39 0.41 56.94 0.38 0.39 0.40 25.59 17.11 17.35 8.48 -0.01 -0.01 0.00 BUY BUY BUY BUY GLOBETRONICS 2.97 0.05 3.10 2.95 2.60 2.82 3.04 59.93 2.87 2.76 2.76 23.88 16.23 18.63 7.65 0.04 0.04 (0.00) BUY SELL BUY - HIAP TECK 0.21 0.01 0.21 0.20 0.18 0.19 0.21 56.58 0.19 0.19 0.19 26.11 14.73 26.89 11.38 0.00 0.00 (0.00) BUY SELL - - HIBISCUS 0.48 0.01 0.48 0.46 0.45 0.49 0.52 35.26 0.47 0.49 0.52 19.86 29.51 20.15 (9.65) -0.02 -0.02 (0.00) SELL SELL - - INARI 2.68 0.03 2.77 2.67 2.39 2.53 2.67 64.27 2.56 2.45 2.34 24.93 15.37 24.71 9.56 0.07 0.08 (0.01) BUY SELL - - 23.78 -0.32 24.98 23.70 18.12 20.89 23.65 77.38 22.03 20.16 18.95 43.48 7.40 61.59 36.08 1.21 1.05 0.16 BUY BUY - - 0.43 -0.03 0.46 0.42 0.34 0.41 0.48 59.13 0.39 0.43 0.46 32.10 22.61 41.88 9.49 -0.02 -0.02 0.00 BUY BUY BUY BUY MPI MRCB SAPURA ENERGY 0.11 0.00 0.11 0.10 0.10 0.10 0.11 51.48 0.10 0.10 0.11 15.11 10.79 13.34 4.32 0.00 0.00 0.00 BUY BUY BUY BUY SKP RESOURCES 1.89 -0.01 1.92 1.87 1.74 1.83 1.91 62.45 1.81 1.82 1.73 25.09 17.54 17.51 7.55 0.02 0.03 (0.01) BUY SELL BUY - SUNCON 1.82 0.02 1.88 1.80 1.74 1.82 1.90 47.34 1.79 1.82 1.84 22.57 21.15 10.33 1.42 -0.02 -0.02 (0.00) BUY SELL BUY - UEM SUNRISE 0.41 -0.01 0.42 0.40 0.36 0.38 0.40 63.87 0.38 0.38 0.38 32.75 17.15 14.46 15.60 0.00 0.00 0.00 BUY BUY BUY BUY VELESTO 0.11 -0.01 0.12 0.11 0.11 0.12 0.13 43.78 0.12 0.12 0.13 11.27 16.23 12.59 (4.97) 0.00 0.00 (0.00) SELL SELL - - UNISEM 6.09 -0.02 6.25 5.91 3.14 4.55 5.96 92.59 5.15 4.24 3.96 51.73 5.13 57.26 46.60 0.54 0.39 0.15 BUY BUY - - VS INDS 2.44 -0.04 2.50 2.41 2.27 2.39 2.51 64.94 2.37 2.34 2.18 25.95 14.87 31.79 11.09 0.06 0.08 (0.02) BUY SELL - - WASEONG 0.41 -0.01 0.42 0.41 0.38 0.43 0.48 44.78 0.41 0.43 0.46 18.64 27.30 37.39 (8.66) -0.02 -0.02 (0.00) SELL SELL - - The table above is a compilation of actively traded stocks with some popular technical indicators. The technical BUY/SELL signals on the last four columns are auto generated; the first two being existing or recent signals while the last two represent a signal change from BUY to SELL or the reverse, otherwise no change is indicated by a dash. Stock names and technical statistics in bold highlight stocks that have changes in BUY/SELL signals on the DMI and MACD on the given date. INTERPRETATION OF TECHNICAL INDICATORS: Bollinger Bands: Variable width bands that narrow during less volatile periods and widen during more volatile periods. As a general rule, in a bearish trend, traders should buy when share price touches the lower band and exit when price touches the middle band. The reverse is true in a bullish trend, ie. buy when price touches the middle band and sell when price touches the upper band. Momentum traders tend to buy on price breakouts above the upper band, and sell when price breaks down below the lower band. 14-day Relative Strength Index (RSI): A reading below 30 is considered oversold, above 70 is overbought. A rise above 50 with a corresponding share price surge above the 30day moving average should be taken as a bullish move with good short-term upside potential. A fall below 50 and a simultaneous dip below the 30-day average is bearish and imply further near-term downside risk. Moving Averages: A stock’s short-term trend is bullish if share price stays above the 10-day moving average, and bearish if it stays below. The medium-term trend is positive if share price stays above the 30-day average, and negative if it remains below. A longer-term uptrend is intact if share price sustain above the 50-day average, and is deemed broken if it breaches below this level. Directional Movement Indicator (DMI): The DMI is an indicator of trend strength. A positive DMI difference (DMI diff) value is bullish and indicate a higher DI+ vs. DI-, while a negative DMI diff is bearish due to a lower DI+ vs. DI- (DMI diff = DI+ minus DI-). A crossover of DI+ above DI- triggers a BUY signal, while a SELL signal is flashed when the DI+ crosses below the DI-. The Average Directional Movement Index (ADX) indicates the strength of a trend, whether it is up or down. The higher the value of ADX, the stronger the trend. An ADX value above 25 suggests a trending market or stock, while a value below 20 signal congestion or absence of trend. Daily Moving Average Convergence Divergence (MACD): The MACD diff value is derived from the difference between the MACD line (the 12-day EMA minus the 26-day EMA) and the MACD signal line (the 9-day EMA of the MACD). A positive MACD diff value is bullish, while a negative MACD diff is bearish. A BUY signal is generated when the MACD diff rises above zero, and SELL signal sparked when the MACD diff value falls below zero. Page 5 of 10
74. 9-Nov-20 LIST OF RECOMMENDED BUY STOCKS FROM AUG 2020 TO CURRENT Stock ABMB AFFIN AMBANK AMBANK AMBANK AMBANK AXIATA AXIATA AXIATA AXIATA BUMI ARMADA BUMI ARMADA CIMB CIMB CIMB CIMB CIMB DIALOG DIALOG DIALOG DIALOG DIGI DIGI DIGI DIGI DNEX DNEX DNEX DNEX FGV FGV GADANG GADANG GAMUDA GAMUDA GAMUDA GENM GENM GENM GENTING GENTING GENTING GLOBETRONICS GLOBETRONICS GLOBETRONICS HIAP TECK HIAP TECK HIBISCUS HIBISCUS HIBISCUS IHH HEALTHCARE IHH HEALTHCARE IHH HEALTHCARE INARI INARI INARI IOI CORP IOI CORP MAXIS MAYBANK MAYBANK MAYBANK MAYBANK MBSB MRCB MRCB RHBBANK RHBBANK RHBBANK RHBBANK SAPURA ENERGY SAPURA ENERGY SIME DARBY SUNCON SUNCON TENAGA TENAGA TENAGA TM UEM SUNRISE UEM SUNRISE VELESTO WAH SEONG WAH SEONG REC Date 11-Sep 8-Sep 2-Sep 1-Oct 13-Oct 27-Oct 26-Aug 9-Sep 14-Oct 28-Oct 11-Aug 22-Sep 14-Aug 8-Sep 1-Oct 13-Oct 27-Oct 12-Aug 17-Sep 2-Oct 22-Oct 26-Aug 9-Sep 14-Oct 28-Oct 18-Aug 17-Sep 2-Oct 21-Oct 18-Aug 15-Sep 27-Aug 18-Sep 25-Aug 18-Sep 29-Sep 3-Sep 9-Oct 15-Oct 3-Sep 9-Oct 15-Oct 19-Aug 10-Sep 8-Oct 15-Sep 21-Oct 12-Aug 22-Sep 22-Oct 25-Aug 6-Oct 20-Oct 19-Aug 10-Sep 8-Oct 30-Sep 20-Oct 4-Sep 2-Sep 11-Sep 7-Oct 30-Oct 24-Sep 27-Aug 25-Sep 14-Aug 7-Oct 16-Oct 30-Oct 13-Aug 23-Sep 29-Sep 28-Aug 30-Sep 24-Sep 6-Oct 16-Oct 4-Sep 28-Aug 25-Sep 13-Aug 11-Aug 23-Sep Total funds invested * Total unrealised profit/(loss) Return BUY Price 2.20 1.44 2.94 3.00 2.98 2.95 3.11 3.22 2.93 2.84 0.22 0.25 3.60 3.24 3.08 3.10 3.04 3.65 3.76 3.82 3.72 4.20 4.04 4.12 3.92 0.23 0.20 0.19 0.23 1.13 1.19 0.41 0.41 3.30 3.53 3.39 2.30 2.10 2.03 3.64 3.23 3.04 2.77 2.65 2.66 0.22 0.21 0.66 0.53 0.50 5.41 5.09 4.96 2.05 2.10 2.46 4.48 4.28 5.04 7.13 7.50 7.19 7.07 0.53 0.51 0.48 5.00 4.56 4.34 4.31 0.13 0.12 2.42 1.93 1.84 10.90 10.40 10.02 4.25 0.40 0.37 0.16 0.49 0.47 6-Nov-20 Price 2.29 1.40 3.00 3.00 3.00 3.00 3.20 3.20 3.20 3.20 0.24 0.24 3.10 3.10 3.10 3.10 3.10 3.80 3.80 3.80 3.80 4.00 4.00 4.00 4.00 0.21 0.21 0.21 0.21 1.15 1.15 0.40 0.40 3.69 3.69 3.69 2.11 2.11 2.11 3.06 3.06 3.06 2.97 2.97 2.97 0.21 0.21 0.48 0.48 0.48 5.27 5.27 5.27 2.68 2.68 2.68 4.45 4.45 5.15 7.18 7.18 7.18 7.18 0.52 0.43 0.43 4.35 4.35 4.35 4.35 0.11 0.11 2.47 1.82 1.82 10.30 10.30 10.30 4.20 0.41 0.41 0.11 0.41 0.41 Change (+/-) 0.09 (0.04) 0.06 0.00 0.02 0.05 0.09 (0.02) 0.27 0.36 0.02 (0.01) (0.50) (0.14) 0.02 0.00 0.06 0.15 0.04 (0.02) 0.08 (0.20) (0.04) (0.12) 0.08 (0.02) 0.01 0.02 (0.02) 0.02 (0.04) (0.02) (0.02) 0.39 0.16 0.30 (0.19) 0.01 0.08 (0.58) (0.17) 0.02 0.20 0.32 0.31 (0.02) (0.01) (0.19) (0.06) (0.03) (0.14) 0.18 0.31 0.63 0.58 0.22 (0.03) 0.17 0.11 0.05 (0.32) (0.01) 0.11 (0.02) (0.09) (0.06) (0.65) (0.21) 0.01 0.04 (0.03) (0.02) 0.05 (0.11) (0.02) (0.60) (0.10) 0.28 (0.05) 0.01 0.04 (0.05) (0.08) (0.06) 244,510 960 0.39% % 4.09 (2.78) 2.04 0.00 0.67 1.69 2.89 (0.62) 9.22 12.68 9.09 (4.00) (13.89) (4.32) 0.65 0.00 1.97 4.11 1.06 (0.52) 2.15 (4.76) (0.99) (2.91) 2.04 (8.70) 5.00 10.53 (8.70) 1.77 (3.36) (3.66) (3.66) 11.82 4.53 8.85 (8.26) 0.48 3.94 (15.93) (5.26) 0.66 7.22 12.08 11.65 (6.82) (2.38) (28.03) (10.38) (5.00) (2.59) 3.54 6.25 30.73 27.62 8.94 (0.67) 3.97 2.18 0.70 (4.27) (0.14) 1.56 (2.83) (16.67) (11.46) (13.00) (4.61) 0.23 0.93 (19.23) (12.50) 2.07 (5.70) (1.09) (5.50) (0.96) 2.79 (1.18) 1.25 9.46 (31.25) (16.33) (12.77) ST Upside Targets ** MT 2.71 1.64 3.69 3.69 3.69 3.69 3.54 3.54 3.54 3.54 0.33 0.33 3.97 3.97 3.97 3.97 3.97 4.29 4.29 4.29 4.29 4.46 4.46 4.46 4.46 0.28 0.28 0.28 0.28 1.38 1.38 0.50 0.50 4.00 4.00 4.00 2.60 2.60 2.60 3.70 3.70 3.70 3.17 3.17 3.17 0.24 0.24 0.66 0.66 0.66 6.42 6.42 6.42 3.00 3.00 3.00 5.00 5.00 5.52 8.51 8.51 8.51 8.51 0.61 0.56 0.56 5.31 5.31 5.31 5.31 0.15 0.15 2.97 2.20 2.20 12.02 12.02 12.02 5.17 0.48 0.48 0.16 0.53 0.53 2.48 1.57 3.40 3.40 3.40 3.40 3.30 3.30 3.30 3.30 0.28 0.28 3.63 3.63 3.63 3.63 3.63 3.99 3.99 3.99 3.99 4.30 4.30 4.30 4.30 0.25 0.25 0.25 0.25 1.25 1.25 0.43 0.43 3.76 3.76 3.76 2.30 2.30 2.30 3.40 3.40 3.40 3.05 3.05 3.05 0.21 0.21 0.56 0.56 0.56 5.97 5.97 5.97 2.82 2.82 2.82 4.82 4.82 5.34 8.14 8.14 8.14 8.14 0.57 0.50 0.50 5.10 5.10 5.10 5.10 0.13 0.13 2.70 1.99 1.99 11.63 11.63 11.63 4.68 0.43 0.43 0.13 0.46 0.46 LT 2.86 1.72 3.87 3.87 3.87 3.87 3.87 3.87 3.87 3.87 0.38 0.38 4.24 4.24 4.24 4.24 4.24 4.48 4.48 4.48 4.48 4.61 4.61 4.61 4.61 0.31 0.31 0.31 0.31 1.50 1.50 0.56 0.56 4.30 4.30 4.30 2.84 2.84 2.84 3.94 3.94 3.94 3.34 3.34 3.34 0.27 0.27 0.75 0.75 0.75 6.86 6.86 6.86 3.27 3.27 3.27 5.15 5.15 5.81 8.74 8.74 8.74 8.74 0.65 0.62 0.62 5.56 5.56 5.56 5.56 0.18 0.18 3.14 2.41 2.41 12.42 12.42 12.42 5.47 0.54 0.54 0.19 0.60 0.60 ST 8.30 12.14 13.33 13.33 13.33 13.33 3.12 3.12 3.12 3.12 16.67 16.67 17.10 17.10 17.10 17.10 17.10 5.00 5.00 5.00 5.00 7.50 7.50 7.50 7.50 19.05 19.05 19.05 19.05 8.70 8.70 8.86 8.86 1.90 1.90 1.90 9.00 9.00 9.00 11.11 11.11 11.11 2.69 2.69 2.69 2.44 2.44 17.89 17.89 17.89 13.28 13.28 13.28 5.22 5.22 5.22 8.31 8.31 3.69 13.37 13.37 13.37 13.37 10.68 17.65 17.65 17.24 17.24 17.24 17.24 23.81 23.81 9.31 9.34 9.34 12.91 12.91 12.91 11.43 6.17 6.17 18.18 12.20 12.20 % Upside MT 18.34 17.14 23.00 23.00 23.00 23.00 10.63 10.63 10.63 10.63 37.50 37.50 28.06 28.06 28.06 28.06 28.06 12.89 12.89 12.89 12.89 11.50 11.50 11.50 11.50 33.33 33.33 33.33 33.33 20.00 20.00 26.58 26.58 8.40 8.40 8.40 23.22 23.22 23.22 20.92 20.92 20.92 6.73 6.73 6.73 17.07 17.07 38.95 38.95 38.95 21.82 21.82 21.82 11.94 11.94 11.94 12.36 12.36 7.18 18.52 18.52 18.52 18.52 18.45 31.76 31.76 22.07 22.07 22.07 22.07 42.86 42.86 20.24 20.88 20.88 16.70 16.70 16.70 23.10 18.52 18.52 45.45 29.27 29.27 LT 24.89 22.86 29.00 29.00 29.00 29.00 20.94 20.94 20.94 20.94 58.33 58.33 36.77 36.77 36.77 36.77 36.77 17.89 17.89 17.89 17.89 15.25 15.25 15.25 15.25 47.62 47.62 47.62 47.62 30.43 30.43 41.77 41.77 16.53 16.53 16.53 34.60 34.60 34.60 28.76 28.76 28.76 12.46 12.46 12.46 31.71 31.71 57.89 57.89 57.89 30.17 30.17 30.17 22.01 22.01 22.01 15.73 15.73 12.82 21.73 21.73 21.73 21.73 26.21 45.88 45.88 27.82 27.82 27.82 27.82 71.43 71.43 27.13 32.42 32.42 20.58 20.58 20.58 30.24 33.33 33.33 72.73 46.34 46.34 Upside Targets ** ST = Short Term (one month) MT = Medium Term (three months) LT = Long Term (above six months) * The portfolio assumes each position consists of 1,000 shares and no deductions for any charges, fees and commision ** Upside Targets are derived from the subsequent Fibonacci Projection levels The above table is a performance summary of our top BUY recommendations from Aug 2020 to current date (sorted by name) together with upside targets, which are taken from subsequent Fibonacci Projection targets which may likely be achieved in one month (ST), three months (MT) and above six months (LT) from recommendation date. Interpretation: Investors should aim to take profit/sell trading positions when the percentage upside on the last three columns falls to 5% or below (shaded column). A negative percentage value indicates the upside target for the particular time-frame has been breached. Any revision in upside targets will be highlighted in bold. Page 6 of 10
75. 9-Nov-20 Support & Resistance on Recommended Stocks Portfolio No. Stock Stock Code Name SL S2 S1 30/Oct R1 R2 R3 Ratio 0.181 AEMULUS 0.40 0.47 0.53 0.650 0.73 0.78 0.90 0.67 2 5210 ARMADA 0.11 0.15 0.18 0.220 0.28 0.33 0.38 3 7277 DIALOG 3.19 3.34 3.50 3.700 3.99 4.29 4.48 4 4456 DNEX 0.10 0.13 0.17 0.175 0.25 0.28 0.31 15.00 5 5222 FGV 0.85 0.92 0.99 1.060 1.25 1.38 1.50 2.71 1 Stop-loss Support 2 Support 1Current price ResistanceResistance 1 Resistance 2 3 Reward RSI Volume (mn Shares) Stochastics today 5d-avg 20d-avg %K %D 44.96 8.842 10.573 12.759 0.0 38.9 1.50 29.74 32.306 21.315 28.216 12.5 12.5 1.45 43.17 8.898 7.055 5.777 47.8 25.1 42.66 22.276 20.362 29.610 0.0 4.8 43.76 13.268 4.188 10.033 10.0 26.7 6 9261 GADANG 0.25 0.28 0.33 0.370 0.50 0.56 0.64 3.25 35.22 1.787 2.544 2.019 10.0 10.7 7 5398 GAMUDA 2.54 2.87 3.15 3.330 3.76 4.00 4.30 2.39 40.75 3.032 1.796 1.811 0.0 17.8 8 7022 GTRONIC 2.30 2.45 2.60 2.850 3.05 3.17 3.34 0.80 54.83 3.788 2.876 2.205 50.0 65.6 9 5072 HIAP TECK 0.12 0.14 0.16 0.185 0.21 0.24 0.27 1.00 47.15 19.288 21.098 19.713 16.7 26.8 10 5199 HIBISCUS 0.34 0.40 0.44 0.460 0.56 0.66 0.75 5.00 24.23 7.693 4.414 6.523 16.7 9.7 11 0.166 INARI 2.10 2.20 2.37 2.540 2.70 2.82 3.00 0.94 58.51 16.657 14.488 16.206 48.4 57.5 12 3867 MPI 18.00 19.07 20.45 22.000 24.06 26.29 28.52 1.33 71.18 0.607 0.302 0.294 57.6 72.4 13 1651 MRCB 0.28 0.32 0.35 0.375 0.45 0.50 0.56 3.00 19.96 4.658 7.570 5.439 6.7 4.4 14 5218 SAPNRG 0.06 0.08 0.09 0.100 0.13 0.15 0.18 3.00 44.01 68.517 39.201 30.100 33.3 44.4 15 7155 SKPRES 1.23 1.37 1.59 1.760 1.94 2.05 2.16 1.06 46.85 3.370 4.143 3.487 21.7 21.0 16 5263 SUNCON 1.51 1.64 1.70 1.810 1.99 2.20 2.41 1.64 45.37 0.131 0.149 0.297 36.4 39.4 17 5148 UEM SUNRISE 0.27 0.32 0.35 0.370 0.43 0.48 0.54 3.00 41.74 1.071 1.746 3.303 33.3 61.1 18 5243 VELESTO 0.08 0.09 0.10 0.115 0.16 0.19 0.21 3.00 36.96 16.952 15.244 15.543 33.3 22.2 19 6963 VS INDS 1.54 1.77 2.13 2.340 2.71 2.90 3.07 1.76 54.94 12.353 11.822 23.990 29.0 20.1 20 5142 WAH SEONG 0.22 0.30 0.34 0.390 0.46 0.53 0.60 1.40 21.57 1.054 0.739 0.463 12.5 9.7 No. Stock Stock Code Name SL S2 S1 6/Nov R1 R2 R3 Ratio 0.181 AEMULUS 0.40 0.47 0.53 0.695 0.73 0.78 0.90 0.21 2 5210 ARMADA 0.11 0.15 0.18 0.240 0.28 0.33 0.38 0.67 3 7277 DIALOG 3.19 3.34 3.50 3.800 3.99 4.29 4.48 0.63 4 4456 DNEX 0.10 0.13 0.17 0.210 0.25 0.28 0.31 1.00 57.61 5 5222 FGV 0.85 0.92 0.99 1.150 1.25 1.38 1.50 0.63 56.59 1 Stop-loss Support 2 Support 1Current price ResistanceResistance 1 Resistance 2 3 Reward RSI Volume (mn Shares) Stochastics today 5d-avg 20d-avg %K %D 3.508 6.810 10.209 64.0 62.7 50.25 5.542 17.500 24.615 85.7 78.0 56.61 9.948 7.121 6.485 77.8 66.1 52.906 23.793 31.602 88.9 62.6 29.111 12.924 8.982 65.0 55.7 55.38 6 9261 GADANG 0.25 0.28 0.33 0.395 0.50 0.56 0.64 1.62 53.67 2.490 2.013 1.958 77.8 64.6 7 5398 GAMUDA 2.54 2.87 3.15 3.690 3.76 4.00 4.30 0.13 64.68 3.021 2.289 2.010 100.0 95.0 8 7022 GTRONIC 2.30 2.45 2.60 2.970 3.05 3.17 3.34 0.22 63.13 4.877 2.329 2.365 67.5 60.2 9 5072 HIAP TECK 0.12 0.14 0.16 0.205 0.21 0.24 0.27 0.11 59.31 26.337 15.237 21.536 66.7 49.1 10 5199 HIBISCUS 0.34 0.40 0.44 0.475 0.56 0.66 0.75 2.43 41.74 5.083 5.846 6.635 66.7 49.5 11 0.166 INARI 2.20 2.37 2.54 2.680 2.82 3.00 3.27 1.00 65.90 20.542 13.705 16.713 74.3 66.4 12 3867 MPI 20.45 21.56 22.68 23.780 26.26 28.52 30.00 2.25 73.70 0.297 0.374 0.273 74.4 79.6 13 1651 MRCB 0.32 0.35 0.38 0.425 0.50 0.56 0.62 1.67 51.21 12.436 9.525 7.080 70.0 70.6 14 5218 SAPNRG 0.06 0.08 0.09 0.105 0.13 0.15 0.18 1.67 51.48 18.869 33.877 31.554 66.7 61.1 15 7155 SKPRES 1.23 1.37 1.59 1.890 2.05 2.16 2.30 0.53 61.04 1.775 2.476 3.302 86.4 78.8 16 5263 SUNCON 1.51 1.64 1.70 1.820 1.99 2.20 2.41 1.42 50.80 0.654 0.188 0.293 60.0 47.8 17 5148 UEM SUNRISE 0.27 0.32 0.35 0.405 0.43 0.48 0.54 0.45 60.82 2.794 2.330 2.001 81.8 79.8 18 5243 VELESTO 0.08 0.09 0.10 0.110 0.16 0.19 0.21 5.00 39.80 5.192 32.284 20.295 25.0 25.0 19 6963 VS INDS 1.54 1.77 2.13 2.440 2.71 2.90 3.07 0.87 60.62 15.243 10.033 18.274 76.0 77.0 20 5142 WAH SEONG 0.22 0.30 0.34 0.410 0.46 0.53 0.60 0.71 40.81 0.578 0.490 0.502 46.2 42.1 Sources: Bloomberg, TA Securities Legend: Reward Ratio = (R1 - CP)/ (CP - S1) Where CP = Current Price Upgrade in price levels shaded dark green and bold Downgrade in price levels lightly shaded RSI: The Relative Strength Index (RSI) is used to measure the velocity of a security's price movement to identify overbought and oversold conditions. RSI reading below 30 indicates an oversold condition, while RSI value greater than 70 indicates overbought condition. Stochastics: measures the velocity of a security's price movement to identify overbought and oversold conditions. The indicator measures current price relative to highs and lows over a time period. When Reward Ratio increase to > 1; RSI < 30 & Stochastics %K & %D < 30 = oversold; look to BUY When Reward Ratio decrease to < 1; RSI > 70 & Stochastics %K & %D > 70 = overbought; look to SELL Page 7 of 10
76. 9-Nov-20 Support & Resistance on Momentum Stocks No. Stock Stock Stop-lossSupport 2SupportCurrent 1 price ResistanceResistance 1 Resistance 2 3Reward Code Name SL S2 S1 30/Oct R1 R2 R3 Ratio 1 5204 PRESTARIANG 0.20 0.25 0.30 0.415 0.52 0.59 0.67 0.91 2 0.138 MYEG 1.08 1.18 1.28 1.370 1.50 1.61 1.81 3 8877 EKOVEST 0.35 0.40 0.44 0.470 0.56 0.62 4 4723 JAKS 0.33 0.36 0.40 0.430 0.53 5 1589 IWCITY 0.35 0.40 0.45 0.475 6 7108 PERDANA 0.06 0.08 0.10 7 5216 DSONIC 0.40 0.45 8 5141 DAYANG 0.51 9 5253 ECONPILE 10 6181 MALTON RSI Volume (mn Shares) Stochastics today 5d-avg 20d-avg %K %D 43.58 4.476 22.063 16.148 51.6 60.4 1.44 47.03 9.509 20.799 19.724 21.4 22.2 0.65 3.00 36.52 14.788 14.504 15.271 0.0 7.7 0.59 0.65 3.33 40.19 17.653 17.516 24.043 17.4 7.8 0.58 0.66 0.77 4.20 30.38 3.391 3.627 4.444 11.8 8.4 0.120 0.18 0.20 0.23 3.00 17.29 9.309 5.461 5.392 0.0 6.7 0.49 0.515 0.62 0.70 0.77 4.20 43.53 22.634 56.501 27.284 5.6 14.8 0.60 0.71 0.750 0.90 1.03 1.13 3.75 16.70 6.506 3.399 4.558 6.5 3.7 0.20 0.25 0.30 0.325 0.45 0.50 0.55 5.00 15.47 6.562 3.715 2.676 4.2 2.9 0.31 0.35 0.39 0.415 0.50 0.54 0.58 3.40 40.60 0.453 1.000 1.259 9.1 15.2 No. Stock Stock Stop-lossSupport 2SupportCurrent 1 price ResistanceResistance 1 Resistance 2 3Reward Code Name SL S2 S1 6/Nov R1 R2 R3 Ratio 1 5204 PRESTARIANG 0.20 0.25 0.30 0.450 0.52 0.59 0.67 0.47 2 0.138 MYEG 1.08 1.18 1.28 1.450 1.50 1.61 1.81 3 8877 EKOVEST 0.35 0.40 0.44 0.515 0.56 0.62 4 4723 JAKS 0.36 0.40 0.45 0.555 0.59 5 1589 IWCITY 0.35 0.40 0.45 0.500 6 7108 PERDANA 0.06 0.08 0.10 7 5216 DSONIC 0.40 0.45 8 5141 DAYANG 0.51 9 5253 ECONPILE 10 6181 MALTON RSI Volume (mn Shares) Stochastics today 5d-avg 20d-avg %K %D 50.66 6.591 17.178 14.406 70.4 67.7 0.29 59.33 6.224 8.408 17.518 80.0 71.1 0.65 0.60 57.01 13.851 12.296 15.104 85.7 68.8 0.65 0.72 0.33 67.53 28.864 30.700 22.979 82.9 74.3 0.58 0.66 0.77 1.60 47.89 7.167 3.793 69.2 60.4 0.125 0.18 0.20 0.23 2.20 31.61 38.621 22.698 10.090 40.0 27.6 0.49 0.535 0.62 0.70 0.77 1.89 50.16 35.370 22.748 28.635 31.6 24.6 0.60 0.71 0.780 0.90 1.03 1.13 1.71 28.60 4.119 5.984 5.248 37.0 33.9 0.25 0.30 0.30 0.445 0.50 0.55 0.60 0.38 53.23 7.886 7.393 4.075 78.1 84.4 0.31 0.35 0.39 0.440 0.50 0.54 0.58 1.20 51.24 0.389 0.594 1.086 75.0 64.4 3.407 Sources: Bloomberg, TA Securities Legend: Reward Ratio = (R1 - CP)/ (CP - S1) Where CP = Current Price Upgrade in price levels shaded dark green and bold Downgrade in price levels lightly shaded RSI: The Relative Strength Index (RSI) is used to measure the velocity of a security's price movement to identify overbought and oversold conditions. RSI reading below 30 indicates an oversold condition, while RSI value greater than 70 indicates overbought condition. Stochastics: measures the velocity of a security's price movement to identify overbought and oversold conditions. The indicator measures current price relative to highs and lows over a time period. When Reward Ratio increase to > 1; RSI < 30 & Stochastics %K & %D < 30 = oversold; look to BUY When Reward Ratio decrease to < 1; RSI > 70 & Stochastics %K & %D > 70 = overbought; look to SELL Page 8 of 10
77. 9-Nov-20 Daily Money Flow of Technical Stock Watch Malaysia Chartist : Stephen Soo No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 37 38 39 39 40 Name Tel: +603-2167 9607 Total Money Flow (RM'mn) 30-Oct 2-Nov 3-Nov FBMKLCI 23.8 13.2 AFFIN ABMB AMBANK AXIATA CIMB DIGI GAMUDA GENTING GENM IHH IOICORP MALAKOFF MAXIS MAYBANK MBSB RHBBANK SIME TENAGA TM WPRTS AEMULUS ARMADA DIALOG DNEX FGV GADANG GTRONIC HIAP TECK HIBISCUS INARI MPI MRCB SAPURA ENERGY SKP RESOURCES SUNCON UEMS VELESTO UNISEM VS IND WASEONG 0.0 (0.0) (0.1) 0.0 1.0 0.8 0.1 2.9 1.1 0.4 0.0 (0.0) (0.6) 1.9 (0.0) (0.1) 0.5 1.6 0.3 (0.8) (0.1) (0.0) 2.9 (0.1) 0.5 (0.0) (0.6) (0.0) 0.0 2.1 (0.2) 0.0 (0.0) (0.1) (0.0) (0.0) 0.0 (0.3) 0.0 0.0 (0.0) (0.0) (0.0) 0.3 3.2 0.1 0.0 0.3 (0.2) (1.2) (0.0) (0.0) 0.3 1.8 (0.0) 1.2 0.0 1.0 0.8 (0.0) 0.0 0.1 1.1 (0.1) (0.0) (0.0) 0.1 (0.0) (0.1) (0.3) 0.5 0.1 (0.1) (0.2) (0.0) 0.0 0.0 (0.2) 0.1 0.0 stsoo@ta.com.my (A) Total 5D MF Prv. Chg (B) Cur. Chg www.taonline.com.my CLOSING PRICE 30-Oct 2-Nov 3-Nov 4-Nov 5-Nov (A+B) DMF 4-Nov 5-Nov Chg (6.9) (7.2) 9.3 32.2 (0.3) 16.5 1,467 1,466 1,461 1,465 1,501 36.88 IN 0.0 0.0 (0.5) (0.1) 0.2 0.3 0.1 0.4 0.5 0.2 (0.1) 0.1 (0.1) 1.5 0.0 2.1 0.5 (0.9) 0.1 (0.0) (0.0) 0.0 0.6 (0.1) (0.1) (0.0) (0.1) (0.0) 0.0 0.7 0.2 0.1 0.0 0.0 0.0 (0.0) 0.0 (0.2) (0.4) 0.0 (0.0) 0.1 (0.1) 0.1 (0.5) 0.0 (0.2) 2.7 0.1 (2.2) 0.2 0.0 0.3 0.3 0.0 (0.1) 0.5 0.2 (0.4) 0.0 (0.0) 0.0 0.2 (0.1) 0.1 (0.0) 0.1 0.1 (0.0) (0.1) 0.2 0.0 (0.0) (0.2) (0.1) 0.0 (0.2) (0.3) (0.2) 0.0 0.0 (0.0) (0.0) 0.1 (0.3) 0.4 (1.0) 1.5 (0.1) 0.1 (0.0) (0.0) (0.6) 3.0 (0.1) (0.3) (0.1) 4.9 (0.1) 0.1 (0.2) 0.0 (0.8) (0.0) 0.4 (0.1) 0.1 0.0 (0.1) (0.1) 0.9 (0.0) 0.0 0.1 (0.1) (0.1) (0.2) 0.3 1.4 (0.0) (0.0) 0.0 (0.7) 0.5 3.5 1.6 (1.0) 7.8 1.3 (2.6) 0.0 0.0 (0.5) 8.4 (0.1) 2.8 1.4 6.8 0.8 (0.8) (0.3) 0.2 4.0 (0.3) 0.8 (0.1) (0.4) (0.0) (0.2) 2.4 1.5 0.2 (0.1) (0.4) (0.2) (0.1) (0.3) (0.6) 0.9 0.0 (0.0) 0.1 0.5 0.3 (0.7) (0.3) (0.3) 2.2 (0.4) (2.3) 0.3 (0.1) 0.4 (1.2) (0.0) (2.2) (0.1) 1.0 (0.5) 0.0 (0.0) 0.0 (0.4) 0.0 0.2 (0.0) 0.2 0.1 (0.0) (0.8) (0.1) (0.1) (0.1) (0.2) (0.1) 0.0 (0.2) (0.2) 0.3 0.0 0.0 (0.1) 0.1 0.0 0.2 0.4 (0.8) (1.1) (0.2) 2.3 (0.2) (0.0) (0.9) 2.7 (0.1) (0.2) (0.6) 4.8 0.3 0.1 (0.2) (0.0) (1.0) 0.1 0.3 (0.1) (0.1) (0.0) (0.1) (0.0) 0.7 (0.0) 0.1 0.3 0.0 (0.1) 0.1 0.6 1.6 (0.0) 1.37 2.18 2.85 2.93 2.95 3.77 3.33 2.96 2.00 4.97 4.30 0.93 4.80 7.00 0.49 4.23 2.41 9.54 4.19 3.90 0.65 0.22 3.70 0.18 1.06 0.37 2.85 0.19 0.46 2.54 22.00 0.38 0.10 1.76 1.81 0.37 0.12 5.10 2.34 0.39 1.35 2.18 2.80 3.00 2.90 3.83 3.28 2.98 2.00 5.06 4.34 0.92 4.84 7.01 0.49 4.33 2.48 9.60 4.19 3.80 0.64 0.21 3.60 0.18 1.03 0.37 2.80 0.19 0.45 2.50 21.48 0.36 0.10 1.76 1.76 0.37 0.11 5.42 2.32 0.39 1.35 2.21 2.81 2.93 2.95 3.79 3.36 2.95 2.00 5.06 4.34 0.90 4.89 7.00 0.49 4.24 2.35 9.55 4.08 3.85 0.65 0.23 3.62 0.19 1.03 0.37 2.79 0.19 0.46 2.47 21.86 0.37 0.10 1.76 1.74 0.37 0.12 5.50 2.35 0.39 1.37 2.25 2.82 2.96 2.97 3.82 3.45 2.96 2.05 5.07 4.42 0.90 4.93 7.00 0.50 4.25 2.41 9.64 4.12 3.90 0.69 0.24 3.65 0.19 1.04 0.38 2.80 0.19 0.46 2.54 22.60 0.38 0.10 1.81 1.76 0.38 0.11 5.54 2.38 0.40 1.39 2.26 2.93 3.05 3.06 3.97 3.60 2.99 2.06 5.28 4.45 0.90 5.02 7.08 0.51 4.31 2.42 10.06 4.20 3.95 0.70 0.24 3.83 0.20 1.18 0.40 2.92 0.20 0.47 2.65 24.10 0.45 0.11 1.90 1.80 0.41 0.12 6.11 2.48 0.42 0.02 0.01 0.11 0.09 0.09 0.15 0.15 0.03 0.01 0.21 0.03 0.00 0.09 0.08 0.01 0.06 0.01 0.42 0.08 0.05 0.01 0.01 0.18 0.01 0.14 0.03 0.12 0.01 0.01 0.11 1.50 0.07 0.00 0.09 0.04 0.03 0.01 0.57 0.10 0.02 IN OUT IN IN OUT IN OUT IN OUT OUT IN OUT OUT IN OUT OUT OUT IN OUT IN OUT IN OUT IN IN OUT IN IN OUT OUT IN OUT IN IN OUT OUT OUT IN IN OUT Sources: Bloomberg, TA Securities Daily Money Flow (DMF) Formulation If previous change (A) + current change (B) > 0, then DMF = “IN”; AND if (A) + (B) < 0, then DMF = “OUT”. Money Flow (MF) Calculation The value of money flow is set to zero at the start of the trading day. When a trade is performed, its price is compared to the price of the previous trade (the first trade of the day is compared to the previous day's close). If the prices differ, the money associated with the trade (price times number of shares) is added to or subtracted from the money flow. Additions (inflows, buys) are done on upticks; subtractions (outflows, sells) are done on downticks. Daily Money Flow (DMF) Interpretation In general, money flow trends confirm price trends. As prices rise, money flows are usually positive. As prices fall, money flows are usually negative. A divergence, however, between money flow and price trend can be a signal of a future price trend change. For example, a falling stock price with a positive money flow (IN) can indicate a future rally in the price of the stock. Conversely, a rising stock price with a negative money flow (OUT) implies potential correction in the stock price. Page 9 of 10
78. 9-Nov-20 Daily Money Flow of FBMKLCI Malaysia Chartist : Stephen Soo No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Name FBMKLCI MAYBANK PBBANK TENAGA CIMB PCHEM IHH AXIATA MAXIS HLBANK SIME PLT DIGI NESTLE PETGAS GENTING MISC IOI CORP GENM KLK PETDAG HAP SENG HLFG PPB TOP GLOVE RHBBANK PMETAL SIME HARTALEGA KLCCSS DIALOG TM (RM'mn) INF LOW OUTF LOW NET FLOW 30-Oct 23.8 1.9 (3.8) 1.6 1.0 2.2 Tel: +603-2167 9607 Total Money Flow (RM'mn) 2-Nov 3-Nov 4-Nov (6.9) (7.2) 13.2 1.8 1.5 0.3 0.7 (3.3) 0.6 (0.9) 0.2 1.0 (0.5) 3.2 0.2 0.1 0.1 0.6 0.2 (0.1) (0.1) 0.0 (0.2) 0.3 (0.3) (0.1) 0.4 (0.1) (0.1) 0.5 (0.2) (1.3) 0.0 (0.0) (0.1) (7.5) 2.1 0.6 0.5 0.2 0.0 0.6 0.1 5-Nov 9.3 3.0 6.4 4.9 (0.3) 0.5 0.1 0.1 (0.6) (0.2) (2.8) 0.4 (2.5) 0.2 1.5 (0.3) (0.0) (0.1) (2.0) (0.9) 0.3 (0.0) 0.4 6.3 (0.3) (0.5) (0.1) (3.2) 0.0 (0.8) (0.1) (2.2) 0.1 0.3 (0.2) (0.1) 0.0 0.1 (0.0) 2.7 0.2 0.2 0.1 0.2 0.6 0.1 (0.0) 0.1 (10.1) (0.1) 0.1 0.5 (0.6) (0.0) 0.2 (0.4) stsoo@ta.com.my Total 5D MF 32.2 8.4 0.8 6.8 3.5 3.6 (2.6) 0.5 (0.5) 0.1 (2.6) 1.6 (3.0) 0.2 7.8 0.4 0.0 1.3 (2.5) (1.9) 0.7 (0.3) 1.0 (0.6) 2.8 2.0 1.4 (1.5) (0.2) 4.0 0.8 0.4 0.0 (0.6) 0.4 0.3 0.8 (0.6) (0.1) 2.9 0.3 0.0 1.1 (0.7) (0.1) 0.1 (0.1) 0.6 8.1 (0.1) 1.5 0.5 2.8 (0.3) 2.9 0.3 (1.2) 0.3 0.3 (0.0) 0.3 0.1 0.3 0.3 0.3 0.3 (0.0) (0.2) 0.2 (0.2) 0.2 (0.2) 0.2 2.7 1.2 0.3 0.0 (0.7) 0.1 1.1 0.8 29.9 15.7 7.4 7.0 24.1 84.1 (6.1) 23.8 (2.4) 13.2 (14.2) (6.9) (14.2) (7.2) (14.8) 9.3 (51.9) 32.2 (A) (B) Prv. Chg Cur. Chg (0.3) 16.5 (1.2) 2.7 3.9 5.8 1.0 4.8 (0.7) 0.2 0.6 (0.2) (2.3) 2.3 0.3 0.0 0.4 (0.9) (0.2) (0.0) 0.1 (2.8) (0.3) 0.4 0.4 (2.6) 0.1 0.3 (1.1) 2.2 0.3 (0.4) 0.3 (0.2) (0.4) (0.2) 0.4 (2.3) 1.8 (1.5) 0.1 0.2 0.0 (0.0) 0.2 0.4 (2.7) 16.4 (2.2) (0.2) (0.5) (0.7) (0.1) (0.6) (0.8) (2.6) (0.1) 0.1 (0.4) (1.0) (0.5) 0.3 30-Oct 1,467 7.00 15.08 9.54 2.95 5.85 2-Nov 1,466 7.01 14.92 9.60 2.90 5.96 4.97 2.93 4.80 14.80 4.84 3.77 139.40 15.74 2.96 6.59 4.30 2.00 21.22 17.24 7.33 14.10 18.80 8.57 4.23 5.49 2.41 18.00 7.60 3.70 4.19 5.06 3.00 4.84 14.78 4.88 3.83 139.80 15.80 2.98 6.52 4.34 2.00 21.80 17.10 7.30 14.02 18.50 8.39 4.33 5.56 2.48 17.84 7.62 3.60 4.19 OUTFLOW 21 (9) 23 (7) 16 (14) 19 (11) CLOSING PRICE 3-Nov 4-Nov 1,461 1,465 7.00 7.00 14.96 14.86 9.55 9.64 2.95 2.97 5.92 6.05 5.06 2.93 4.89 14.72 4.86 3.79 139.00 15.86 2.95 6.58 4.34 2.00 21.68 17.58 7.32 14.10 18.36 8.32 4.24 5.52 2.35 17.76 7.60 3.62 4.08 5.07 2.96 4.93 14.52 4.83 3.82 139.70 15.80 2.96 6.70 4.42 2.05 22.26 17.50 7.35 14.20 18.28 8.10 4.25 5.55 2.41 17.84 7.51 3.65 4.12 5-Nov 1,501 7.08 15.00 10.06 3.06 6.37 5.28 3.05 5.02 14.70 5.15 3.97 140.00 16.30 2.99 6.88 4.45 2.06 22.74 18.10 7.60 14.36 18.50 8.30 4.31 5.75 2.42 18.00 7.69 3.83 4.20 Chg 36.88 0.08 0.14 0.42 0.09 0.32 0.21 0.09 0.09 0.18 0.32 0.15 0.30 0.50 0.03 0.18 0.03 0.01 0.48 0.60 0.25 0.16 0.22 0.20 0.06 0.20 0.01 0.16 0.18 0.18 0.08 (A+B) DMF IN IN IN IN OUT IN OUT IN OUT OUT OUT IN OUT IN IN OUT IN OUT OUT IN IN OUT IN IN OUT OUT OUT OUT IN OUT OUT Daily Trading Participation COMPANIES INFLOW www.taonline.com.my 13 (17) Date Retail Ins titution Foreign Total 30-Oct 38.8% 41.8% 19.4% 100% 2-Nov 3-Nov 4-Nov 5-Nov 39.1% 40.5% 43.3% 42.0% 47.1% 44.8% 44.6% 43.4% 13.8% 14.8% 12.1% 14.6% 100% 100% 100% 100% Sources: Bloomberg, TA Securities Daily Money Flow (DMF) Formulation If previous change (A) + current change (B) > 0, then DMF = “IN”; AND if (A) + (B) < 0, then DMF = “OUT”. Money Flow (MF) Calculation The value of money flow is set to zero at the start of the trading day. When a trade is performed, its price is compared to the price of the previous trade (the first trade of the day is compared to the previous day's close). If the prices differ, the money associated with the trade (price times number of shares) is added to or subtracted from the money flow. Additions (inflows, buys) are done on upticks; subtractions (outflows, sells) are done on downticks. Daily Money Flow (DMF) Interpretation In general, money flow trends confirm price trends. As prices rise, money flows are usually positive. As prices fall, money flows are usually negative. A divergence, however, between money flow and price trend can be a signal of a future price trend change. For example, a falling stock price with a positive money flow (IN) can indicate a future rally in the price of the stock. Conversely, a rising stock price with a negative money flow (OUT) implies potential correction in the stock price. Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy and/ 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. As of Monday, November 09, 2020, the chartist, Stephen Soo, who prepared this report, has interest in the following securities covered in this report: (a) nil Kaladher Govindan – Head of Research TA SECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048 www.ta.com.my Page 10 of 10
79. Technical View Monday , November 09, 2020 Weekly Ace Market Stock Watch Malaysia Chartist: Stephen Soo Tel: +603-2167 9607 stsoo@ta.com.my www.taonline.com.my Report Description: The Weekly Ace Market Stock Watch is a compilation of selected stocks aimed at providing trading ideas and guide for momentum trading. The following table is derived from the 109 Ace Market counters currently listed in Bursa Malaysia. This recommendation is based on combination of fundamental and technical analysis. List of 30 Ace Market Stocks Current Closing No Code Name Volume Market Price (RM) Price to Book EPS (RM) PE Ratio (%) Operating 4Q19 1Q20 4Q19 1Q20 2018 2019 4Q19 Return on Revenue 1Q20 4Q19 1Q20 4Q19 1 0177 PASUKGB [S] 48,865,004 0.065 1,477,700 0.45 0.20 -0.01 0.00 NA NA -44.55 -162.45 -6.88 2 0105 ASIAPLY [S] 178,469,916 0.400 2,655,200 0.40 0.20 0.00 0.00 NA NA -7.13 6,943,800 0.23 0.21 0.00 0.00 NA NA 178,877,100 0.68 0.21 0.00 0.00 13.33 8.33 Net Income 1Q20 2018 2019 -7.36 3.85 1.40 -7.27 -10.92 1.40 -4.33 -3.35 18.47 14.80 -2.86 -4.62 -44.61 1.11 -6.90 -5.07 12.53 9.37 -15.94 -20.53 34.08 -84.98 8.35 4.43 2.24 0.81 16.81 10.09 3 0133 SANICHI [S] 94,247,614 0.050 4 0018 ACCSOFT 135,550,650 0.030 5 0095 XINGHE 154,193,716 0.185 216,500 0.29 0.23 -0.17 0.00 NA NA -6.17 6.71 -16.01 -16.44 78.20 2.24 -23.59 -101.42 6 0148 SUNZEN 55,520,292 0.155 300 0.61 0.24 -0.02 0.00 NA NA -45.09 -15.01 -11.78 -13.29 41.91 21.34 -6.94 -16.25 7 0096 NEXGRAM [S] 94,349,779 0.040 86,764,600 0.25 0.25 -0.01 0.00 NA NA -118.52 -8.63 -8.16 15.73 12.00 -61.58 -21.01 8 0036 KGROUP [S] 54,443,427 0.055 79,546,900 0.32 0.26 0.00 -0.01 NA NA -13.29 -44.77 -6.84 -7.06 14.18 6.60 -9.60 -6.98 9.55 9 0160 HHHCORP [S] 32,918,833 0.100 2,144,500 0.48 0.27 0.00 0.00 14.66 18.42 3.90 0.75 13.28 11.89 1.94 1.90 10 0174 IDMENSN [S] 16,317,731 0.070 180,000 0.35 0.28 -0.03 0.00 NA NA -362.03 9.19 -48.69 -50.67 3.96 2.07 -17.61 -16.95 11 0154 EAH [S] 177,532,620 0.030 49,672,400 0.43 0.29 -0.01 0.00 NA NA NA 10.16 -28.39 -23.79 NA 8.49 -7.90 -50.53 12 0072 AT [S] 166,985,645 0.130 12,244,700 0.41 0.31 -0.01 0.00 NA NA -145.31 -52.31 -10.33 -11.39 4.53 3.62 -5.63 -8.75 13 0070 MQTECH [S] 75,236,669 -217.08 -38.34 -14.22 -14.23 1.81 1.94 -5.32 -7.48 14 0024 36.09 37.40 1.85 -11.91 15 0107 16 0085 MLAB [S] 62,489,571 17 0165 XOX [S] 233,810,397 0.115 18 0039 GFM 93,512,363 0.170 903,800 1.30 19 0179 BIOHLDG [S] 155,611,040 0.265 67,046,700 0.96 20 0150 0.100 66,982,800 0.32 0.125 26,339,100 0.35 0.33 -0.01 0.00 NA NA 0.160 1,351,000 0.42 0.36 0.00 0.00 50.00 NA 4.35 4.63 -6.13 -2.18 EDUSPEC [S] 79,115,035 0.025 29,712,800 NA 0.44 NA 0.00 NA NA NA 21.39 NA NA NA 5.97 -48.19 NA 0.225 4,246,900 0.44 0.45 0.00 0.00 NA NA -1,155.72 -17.29 -10.99 -9.08 0.20 6.53 -3.89 -5.34 413,861,800 0.36 0.47 0.00 0.00 NA NA 0.62 1.03 -0.31 NA 74.10 65.16 -6.28 -0.50 0.49 0.00 0.00 24.86 23.02 25.66 30.12 1.14 0.32 24.29 31.08 7.64 5.95 0.54 0.00 -0.01 14.89 19.07 19.85 -76.70 4.46 1.04 19.88 6.53 11.57 8.32 0.54 -0.02 0.04 1.07 NA -1,464.09 251.31 -21.78 8.94 0.52 9.69 43.44 -40.02 FINTEC 119,271,394 21 0170 0156 23 0092 24 0161 SCH [S] 47,218,496 25 0189 MATANG 26 0180 KTC [S] 27 0079 28 0100 29 0103 0035 2.20 107,358,366 JAG [S] 22 30 5.70 KANGER [S] 123,525,466 0.185 1,859,200 0.61 0.55 0.01 0.00 NA 10.96 36.60 1.43 15.69 11.26 -1.71 6.85 71,046,558 0.155 2,728,800 0.88 0.56 0.00 -0.01 NA NA -27.93 -173.45 -6.09 -10.40 4.39 3.05 -8.61 -5.48 MTOUCHE [S] 58,319,520 0.050 47,055,200 0.44 0.60 0.01 0.00 26.32 NA 31.26 26.73 -22.33 -18.84 16.49 4.61 1.39 -20.60 0.095 50,000 0.71 0.61 0.00 0.00 NA 10.58 10.68 2.81 3.54 3.48 25.12 32.76 -8.88 5.76 144,800,020 0.080 1,200,000 0.68 0.63 0.00 0.00 30.43 70.00 -0.04 6.93 0.97 0.80 2.30 2.08 110,597,749 0.135 485,200 0.73 0.68 0.01 0.00 NA 6.38 3.12 2.87 3.53 3.39 ORION [S] 58,326,111 0.080 11,089,300 NA 0.72 0.00 0.00 NA 46.30 -1,023.29 -0.89 ESCERAM 114,308,353 0.600 1,701,300 0.61 0.75 0.00 0.01 MNC 63,128,377 0.045 3,076,000 NA 0.78 0.00 0.00 NA NA OPCOM [S] 59,662,477 0.370 354,500 1.21 0.82 0.00 -0.01 9.02 237.50 MPAY 181.82 35.53 -36.76 3.98 165.54 157.31 4.09 1.83 -8.13 12.39 1.49 0.36 0.22 0.90 -0.53 1.65 10.90 10.82 1.44 2.51 9.38 8.75 0.23 0.79 NA -22.76 NA NA 1.32 4.81 -3.35 -3.45 -10.31 -17.09 0.37 -0.98 15.85 11.86 6.68 0.45 Source: Bloomberg This list is sorted first by the lowest price-to-book ratio from the 109 stocks listed in the Bursa Malaysia Ace Market sector which had reported 1Q2020 results. INTERPRETATION OF FUNDAMENTAL INDICATORS: Price to Book: The price-to-book ratio, or P/B ratio, is a financial ratio used to compare a company's current market price to its book value. It is also sometimes known as a Market-to-Book ratio. The calculation can be performed in two ways, but the result should be the same each way. Earnings Per Share (EPS): The portion of a company's profit allocated to each outstanding share of common stock. Earnings per share serves as an indicator of a company's profitability. PE Ratio: The price-to-earnings ratio, or P/E ratio, is an equity valuation multiple. It is defined as market price per share divided by annual earnings per share. Revenue: The amount of money that a company actually receives during a specific period, including discounts and deductions for returned merchandise. It is the "top line" or "gross income" figure from which costs are subtracted to determine net income. Net Income: A company's total earnings (or profit). Net income is calculated by taking revenues and adjusting for the cost of doing business, depreciation, interest, taxes and other expenses. Page 1 of 2
80. Support & Resistance – Ace Market No. 1 Stock Stock Code Name Stop-loss Support 2 Support 1Current price Resistance 1 Resistance 2 Resistance 3 Reward SL S2 S1 30/Oct R1 R2 R3 Ratio 0177 PASUKGB [S] 0.01 0.02 0.03 0.050 0.08 0.10 0.12 1.50 RSI Volume (mn Shares) Stochastics today 5d-avg 20d-avg %K %D 35.23 3.641 25.743 26.662 20.0 20.0 2 0105 ASIAPLY [S] 0.25 0.31 0.38 0.395 0.53 0.60 0.73 9.00 37.68 32.728 16.533 19.697 4.3 23.7 3 0133 SANICHI [S] 0.02 0.03 0.04 0.050 0.08 0.09 0.10 3.00 39.64 2.905 15.864 8.518 33.3 33.3 134.705 129.372 4 0018 LAMBO 0.01 0.02 0.02 0.030 0.06 0.08 0.10 3.00 46.95 8.130 5 0095 XINGHE 0.12 0.14 0.16 0.185 0.25 0.29 0.33 2.60 25.09 1.952 0.724 33.3 33.3 0.576 33.3 30.6 6 0148 SUNZEN 0.07 0.09 0.13 0.145 0.24 0.29 0.35 6.33 38.41 3.139 2.037 3.008 14.3 18.1 7 0096 NEXGRAM [S] 0.01 0.02 0.03 0.035 0.07 0.08 0.09 7.00 40.83 7.068 9.409 12.977 0.0 11.1 8 0036 KGROUP [S] 0.01 0.03 0.05 0.055 0.09 0.10 0.12 7.00 42.00 19.186 42.696 37.877 20.0 18.9 9 0160 HHHCORP [S] 0.06 0.08 0.09 0.100 0.13 0.16 0.18 3.00 45.00 0.330 0.819 1.081 25.0 25.0 10 0174 IDMENSN [S] 0.02 0.04 0.05 0.065 0.11 0.13 0.16 3.00 39.67 2.896 1.999 1.944 0.0 11.1 11 0154 EAH [S] 0.01 0.01 0.01 0.020 0.04 0.06 0.07 2.00 43.98 1.409 8.540 7.225 50.0 50.0 12 0072 AT [S] 0.04 0.05 0.06 0.100 0.11 0.13 0.15 0.25 63.70 293.519 169.671 173.130 87.5 75.0 13 0070 MQTECH [S] 0.06 0.08 0.10 0.120 0.16 0.19 0.24 2.00 42.29 20.515 11.742 26.358 11.1 7.9 14 0024 JAG [S] 0.10 0.12 0.14 0.155 0.21 0.25 0.28 3.67 39.86 1.608 5.775 2.690 0.0 12.5 15 0107 EDUSPEC [S] 0.01 0.01 0.02 0.020 0.05 0.07 0.09 6.00 44.17 2.336 4.840 16.948 50.0 50.0 16 0085 MLAB [S] 0.01 0.01 0.01 0.020 0.04 0.05 0.06 2.00 36.20 10.287 96.863 69.874 10.0 10.0 17 0165 XOX [S] 0.06 0.08 0.10 0.100 0.16 0.18 0.20 NA 28.43 25.430 48.288 106.223 0.0 11.1 18 0039 GFM 0.10 0.13 0.15 0.170 0.23 0.28 0.34 3.00 44.93 6.267 2.496 4.007 16.7 12.2 19 0179 BIOHLDG [S] 0.16 0.19 0.22 0.230 0.30 0.32 0.35 7.00 40.35 11.180 7.529 20.771 0.0 11.1 20 0150 FINTEC 0.05 0.07 0.08 0.085 0.12 0.15 0.18 7.00 38.00 8.039 14.525 27.484 0.0 13.3 21 0170 KANGER [S] 0.10 0.12 0.14 0.155 0.19 0.22 0.26 2.33 36.55 48.369 83.766 132.124 7.7 11.4 22 0156 MPAY 0.08 0.10 0.12 0.140 0.20 0.22 0.24 3.00 42.55 3.919 3.715 2.758 11.1 8.5 23 0092 MTOUCHE [S] 0.02 0.03 0.04 0.050 0.07 0.08 0.09 2.00 41.73 5.825 23.280 37.662 33.3 27.8 24 0161 SCH [S] 0.04 0.06 0.08 0.090 0.13 0.15 0.18 4.00 40.32 4.120 7.421 6.824 0.0 20.0 25 0189 MATANG 0.05 0.06 0.07 0.075 0.10 0.11 0.12 5.00 42.36 0.450 0.845 1.059 0.0 33.3 26 0180 KTC [S] 0.10 0.11 0.12 0.130 0.16 0.18 0.19 3.00 29.17 0.656 1.107 0.872 20.0 6.7 27 0079 ORION [S] 0.04 0.05 0.06 0.070 0.11 0.13 0.15 4.00 39.84 7.625 2.662 4.216 0.0 11.1 28 0100 ESCERAM 0.30 0.40 0.50 0.560 0.70 0.87 1.00 2.33 32.25 28.691 47.300 41.783 4.9 8.1 29 0103 MNC 0.01 0.02 0.03 0.040 0.06 0.07 0.08 2.00 41.39 2.538 5.506 11.861 33.3 22.2 30 0035 OPCOM [S] 0.20 0.25 0.30 0.315 0.39 0.45 0.53 5.00 22.81 0.376 0.235 0.335 0.0 6.7 No. Stock Stock Code Name SL S2 S1 6/Nov R1 R2 R3 Ratio 0177 PASUKGB [S] 0.01 0.02 0.03 0.065 0.08 0.10 0.12 0.43 1 Stop-loss Support 2 Support 1Current price Resistance 1 Resistance 2 Resistance 3 Reward Volume (mn Shares) RSI Stochastics today 5d-avg 20d-avg %K %D 52.53 27.211 10.474 21.582 80.0 53.3 2 0105 ASIAPLY [S] 0.25 0.31 0.38 0.400 0.53 0.60 0.73 6.50 41.37 18.408 22.893 20.466 36.4 35.9 3 0133 SANICHI [S] 0.02 0.03 0.04 0.050 0.08 0.09 0.10 3.00 42.11 0.790 15.354 10.742 50.0 61.1 4 0018 LAMBO 0.01 0.02 0.02 0.030 0.06 0.08 0.10 3.00 46.95 5 0095 XINGHE 0.12 0.14 0.16 0.185 0.25 0.29 0.33 2.60 25.09 112.571 199.420 176.180 0.747 3.192 1.258 50.0 38.9 40.0 40.0 6 0148 SUNZEN 0.07 0.09 0.13 0.155 0.24 0.29 0.35 3.40 47.19 0.381 1.205 2.450 57.1 52.4 7 0096 NEXGRAM [S] 0.01 0.02 0.03 0.040 0.07 0.08 0.09 3.00 49.82 6.229 14.644 13.261 66.7 55.6 8 0036 KGROUP [S] 0.01 0.03 0.05 0.055 0.09 0.10 0.12 7.00 44.74 44.358 49.914 44.480 25.0 41.7 9 0160 HHHCORP [S] 0.06 0.08 0.09 0.100 0.13 0.16 0.18 3.00 45.84 0.120 0.290 0.720 50.0 41.7 10 0174 IDMENSN [S] 0.02 0.04 0.05 0.070 0.11 0.13 0.16 2.00 45.99 0.743 1.920 1.679 50.0 38.9 11 0154 EAH [S] 0.01 0.01 0.01 0.030 0.04 0.06 0.07 0.50 58.39 23.888 42.240 17.298 100.0 100.0 12 0072 AT [S] 0.06 0.08 0.10 0.130 0.15 0.19 0.23 0.67 74.80 1055.370 408.326 244.822 84.6 88.2 13 0070 MQTECH [S] 0.06 0.08 0.10 0.125 0.16 0.19 0.24 1.40 46.61 11.923 16.498 25.265 60.0 49.2 14 0024 JAG [S] 0.10 0.12 0.14 0.160 0.21 0.25 0.28 2.50 44.36 2.407 2.901 3.154 22.2 22.2 15 0107 EDUSPEC [S] 0.01 0.01 0.02 0.025 0.05 0.07 0.09 2.50 56.94 1.705 6.258 12.453 100.0 83.3 16 0085 MLAB [S] 0.08 0.10 0.15 0.225 0.26 0.36 0.45 0.47 42.85 9.686 26.295 13.119 46.9 53.8 17 0165 XOX [S] 0.06 0.08 0.10 0.115 0.16 0.18 0.20 3.00 42.72 51.533 146.394 95.456 37.5 41.7 18 0039 GFM 0.10 0.13 0.15 0.170 0.23 0.28 0.34 3.00 47.47 1.936 3.829 3.663 60.0 46.2 19 0179 BIOHLDG [S] 0.16 0.19 0.22 0.265 0.30 0.32 0.35 0.78 58.00 25.001 7.339 19.139 87.5 59.3 20 0150 FINTEC 0.05 0.07 0.08 0.100 0.12 0.15 0.18 1.00 54.42 20.307 15.964 22.180 75.0 58.3 21 0170 KANGER [S] 0.10 0.12 0.14 0.185 0.19 0.22 0.26 0.11 49.80 270.166 86.376 116.302 66.7 67.7 22 0156 MPAY 0.08 0.10 0.12 0.155 0.20 0.22 0.24 1.29 53.06 3.643 2.934 3.247 66.7 50.5 23 0092 MTOUCHE [S] 0.02 0.03 0.04 0.050 0.07 0.08 0.09 2.00 43.10 25.839 10.282 27.519 50.0 61.1 24 0161 SCH [S] 0.04 0.06 0.08 0.095 0.13 0.15 0.18 2.33 46.42 0.977 2.053 6.245 20.0 26.7 25 0189 MATANG 0.05 0.06 0.07 0.080 0.10 0.11 0.12 2.00 50.25 0.520 1.029 1.134 50.0 66.7 26 0180 KTC [S] 0.10 0.11 0.12 0.135 0.16 0.18 0.19 1.67 39.25 0.742 0.521 0.845 50.0 46.7 27 0079 ORION [S] 0.04 0.05 0.06 0.080 0.11 0.13 0.15 1.50 53.69 3.371 3.778 4.081 100.0 75.0 28 0100 ESCERAM 0.30 0.40 0.50 0.600 0.70 0.87 1.00 1.00 36.13 46.196 28.512 45.523 24.5 18.7 29 0103 MNC 0.01 0.02 0.03 0.045 0.06 0.07 0.08 1.00 52.40 1.223 4.359 5.925 100.0 83.3 30 0035 OPCOM [S] 0.20 0.25 0.30 0.370 0.45 0.53 0.65 1.14 62.60 2.886 0.451 0.359 75.0 70.8 Sources: Bloomberg, TA Securities Legend: Reward Ratio = (R1 - CP)/ (CP - S1) Where CP = Current Price Upgrade in price levels shaded dark green and bold Downgrade in price levels lightly shaded RSI: The Relative Strength Index (RSI) is used to measure the velocity of a security's price movement to identify overbought and oversold conditions. RSI reading below 30 indicates an oversold condition, while RSI value greater than 70 indicates overbought condition. Stochastics: measures the velocity of a security's price movement to identify overbought and oversold conditions. The indicator measures current price relative to highs and lows over a time period. When Reward Ratio increase to > 1; RSI < 30 & Stochastics %K & %D < 30 = oversold; look to BUY When Reward Ratio decrease to < 1; RSI > 70 & Stochastics %K & %D > 70 = overbought; look to SELL Page 2 of 2
81. 3131 Technical View Monday , November 09, 2020 Weekly Small Cap Stock Watch Malaysia Chartist: Stephen Soo Tel: +603-2167 9607 stsoo@ta.com.my www.taonline.com.my Report Description: The Weekly Small Cap Stock Watch is a compilation of selected stocks aimed at providing trading ideas and guide for momentum trading. The following is derived from the complete list of Main Market stocks of more than 800 counters currently in Bursa Malaysia. This recommendation is based on combination of fundamental and technical analysis. List of 25 Small Cap Stocks Current Closing Market Cap Price PUNCAK [S] 96,158,268 0.210 5256 REACH [S] 3 5187 4 No Code Name 1 6807 2 Volume Price to Book EPS (RM) PE Ratio (%) Operating Margin Return on Revenue Net Income 4Q19 1Q20 4Q19 1Q20 2018 2019 4Q19 1Q20 4Q19 1Q20 4Q19 1Q20 2018 2019 0.11 0.05 -0.02 -0.01 NA NA 7.22 16.78 93,195,020 0.080 18,013,200 0.38 0.08 -0.08 0.00 NA NA -331.98 -198.58 -8.08 -6.93 37.76 22.68 -41.73 -128.40 HBGLOB 58,500,000 0.150 2,871,100 0.15 0.09 0.01 -0.02 2.33 3.07 17.92 -66.70 3.48 5101 EVERGRN [S] 173,396,175 0.300 5,842,000 0.20 0.11 -0.02 -0.01 18.13 NA -3.84 -4.70 -2.65 -2.79 240.80 227.41 16.35 -41.96 5 5657 PARKSON [S] 90,712,540 0.130 1,621,500 0.14 0.12 -0.04 -0.04 NA NA 5.12 4.87 -1.48 -1.28 953.49 887.45 -99.44 -129.18 6 8702 TEXCHEM 68,725,376 0.675 452,000 0.31 0.13 -0.01 -0.06 NA NA 3.67 -0.68 -1.08 -2.52 289.80 251.70 -6.10 -6.90 7 4251 IBHD [S] 178,549,859 0.175 310,000 0.24 0.14 0.00 0.00 6.86 10.12 27.63 6.30 1.44 1.15 8 3778 MELEWAR [S] 73,680,629 0.215 299,700 0.13 0.14 0.12 0.00 NA 1.33 33.08 1.36 4.07 4.54 152.16 183.99 -0.67 30.76 9 5098 MASTEEL [S] 137,365,665 0.310 187,000 0.26 0.14 0.00 -0.01 24.37 NA 1.87 -2.54 -0.57 -0.26 349.86 397.64 6.71 10 5202 MSM [S] 418,273,100 0.510 405,100 0.37 0.15 -0.06 -0.05 48.90 NA -3.03 -2.84 -9.03 -9.93 516.04 510.84 35.66 -299.77 11 5038 KSL [S] 584,899,199 0.465 179,000 0.25 0.15 0.10 0.01 3.07 51.24 21.01 7.47 6.95 260.17 80.29 223.23 249.91 12 5205 SENDAI [S] 206,964,735 0.220 220,500 0.35 0.15 -0.01 -0.01 10.43 23.24 6.23 -1.54 0.41 -0.22 365.82 228.50 46.66 13.50 13 9342 ANZO [S] 107,031,715 0.085 14,485,100 0.22 0.15 0.00 0.00 NA NA -54.53 -40.11 -2.21 -2.32 1.72 14 7028 ZECON [S] 75,662,173 0.470 83,600 0.16 0.16 -0.09 0.20 4.11 NA -40.41 26.05 -1.63 78.26 169.90 13.23 -20.97 15 4243 WTK [S] 210,871,105 0.455 860,100 0.28 0.17 -0.16 -0.04 NA NA -39.63 -15.74 -7.86 -9.22 137.07 108.34 81.20 -111.27 16 8893 MKLAND [S] 132,504,854 0.125 2,109,100 0.18 0.17 0.00 0.00 10.00 36.00 65.90 4.40 0.39 17 7073 SEACERA [S] 122,761,040 0.250 422,900 0.24 0.17 0.00 -0.01 NA NA 62.54 -833.14 -15.48 -5.42 18 9679 WCT [S] 663,025,194 0.395 2,247,300 0.39 0.17 0.01 0.00 8.73 NA 18.45 14.57 1.02 19 4235 LIONIND [S] 200,840,149 0.280 1,931,700 0.22 0.17 -0.09 -0.16 3.39 NA -5.37 -12.14 -5.24 -9.80 745.95 656.40 172.92 -157.25 20 7164 KNM [S] 571,127,759 0.165 20,963,500 0.53 0.18 0.00 0.01 NA 20.49 9.52 9.29 1.23 21 5115 ALAM [S] 105,815,004 0.075 5,138,400 0.41 0.19 -0.07 -0.02 NA NA -69.76 -20.23 -12.48 NA 98.06 104.43 -170.94 -79.48 22 3395 BJCORP 877,378,415 0.195 1,423,600 0.20 0.19 -0.01 NA NA NA 2.71 NA NA NA 2,071.05 -357.87 NA 23 5843 KPS [S] 266,005,575 0.735 128,000 0.19 0.03 0.01 NA 14.00 9.16 5.91 1.21 1.33 297.22 234.39 -205.55 26.88 24 5932 BPURI 57,246,683 0.085 1,700,500 0.26 0.20 0.00 0.00 116.67 NA 11.67 11.43 NA NA 170.05 89.55 25 2194 404,300 0.20 0.02 0.02 11.53 11.73 21.58 18.69 0.99 0.98 1,092.63 1,086.83 220.08 255.17 MMCCORP [S] 2,192,442,157 0.780 175,500 0.39 0.32 NA 3.23 -1.84 -1.41 142.32 110.33 -169.66 -57.22 -0.65 48.69 14.58 18.33 16.83 1.28 0.34 47.16 28.70 58.79 25.78 2.22 -8.33 -4.93 -3.46 25.10 54.51 27.32 6.37 0.33 0.69 -43.13 -5.86 0.75 461.04 363.08 107.86 -27.32 1.30 457.85 336.56 -774.82 45.53 0.52 -0.55 Source: Bloomberg This list is sorted first by the lowest price-to-book ratio from the Main Market which had reported 1Q2020 results and excludes the FBM100 stocks. INTERPRETATION OF FUNDAMENTAL INDICATORS: Price to Book: The price-to-book ratio, or P/B ratio, is a financial ratio used to compare a company's current market price to its book value. It is also sometimes known as a Market-to-Book ratio. Earnings Per Share (EPS): The portion of a company's profit allocated to each outstanding share of common stock. Earnings per share serves as an indicator of a company's profitability. PE Ratio: The price-to-earnings ratio, or P/E ratio, is an equity valuation multiple. It is defined as market price per share divided by annual earnings per share. Revenue: The amount of money that a company actually receives during a specific period, including discounts and deductions for returned merchandise. It is the "top line" or "gross income" figure from which costs are subtracted to determine net income. Net Income: A company's total earnings (or profit). Net income is calculated by taking revenues and adjusting for the cost of doing business, depreciation, interest, taxes and other expenses. Page 1 of 2
82. Support & Resistance – Small Cap No. Stock Stock Code Name Stop-loss Support 2 Support 1 Current price Resistance 1 Resistance 2 Resistance 3 Reward SL S2 S1 30/Oct R1 R2 R3 Ratio RSI Volume (mn Shares) 1 6807 PUNCAK [S] 0.13 0.16 0.19 0.200 0.24 0.28 0.32 4.00 45.77 1.095 1.550 2 5256 REACH [S] 0.01 0.03 0.05 0.070 0.10 0.13 0.15 1.50 39.00 4.548 3 5187 HBGLOB 0.09 0.11 0.13 0.135 0.18 0.20 0.22 9.00 42.67 3.549 4 5101 EVERGRN [S] 0.14 0.18 0.20 0.250 0.32 0.37 0.40 1.40 40.94 7.118 5 5657 PARKSON [S] 0.06 0.08 0.10 0.115 0.16 0.20 0.25 3.00 44.71 8.262 6 8702 TEXCHEM 0.36 0.47 0.56 0.680 0.75 0.92 1.09 0.58 57.14 2.933 7 4251 IBHD [S] 0.12 0.14 0.16 0.170 0.23 0.27 0.31 6.00 38.92 8 3778 MELEWAR [S] 0.12 0.14 0.16 0.190 0.27 0.31 0.38 2.67 39.29 9 5098 MASTEEL [S] 0.20 0.23 0.25 0.280 0.39 0.45 0.53 3.67 10 5202 MSM [S] 0.35 0.40 0.45 0.480 0.60 0.69 0.80 11 5038 KSL [S] 0.35 0.40 0.43 0.460 0.60 0.66 0.72 12 5205 SENDAI [S] 0.12 0.14 0.17 0.200 0.24 0.27 13 9342 ANZO [S] 0.03 0.05 0.07 0.080 0.14 14 7028 ZECON [S] 0.22 0.28 0.36 0.405 0.49 15 4243 WTK [S] 0.26 0.30 0.36 0.395 16 8893 MKLAND [S] 0.08 0.10 0.12 17 7073 SEACERA [S] 0.18 0.20 18 9679 WCT [S] 0.24 19 4235 LIONIND [S] 20 7164 21 %D 1.276 12.5 25.0 1.903 1.836 0.0 0.0 5.009 8.575 0.0 14.8 6.142 8.739 10.0 20.0 16.085 42.236 16.7 5.6 5.535 1.684 33.3 61.1 0.528 1.004 0.734 0.0 0.0 0.225 0.333 0.370 0.0 0.0 43.08 0.396 0.195 0.338 12.5 25.0 4.00 44.85 0.367 1.035 1.231 12.5 16.7 4.67 24.52 0.953 0.926 1.056 0.0 3.0 0.30 1.33 30.20 0.556 2.878 2.067 11.1 21.5 0.16 0.20 6.00 37.37 4.464 5.716 9.291 0.0 22.2 0.55 0.60 1.89 40.20 0.343 1.172 0.491 5.3 22.8 0.47 0.53 0.58 2.14 26.09 1.628 0.513 0.652 0.0 20.6 0.125 0.17 0.19 0.22 9.00 38.41 1.559 0.522 0.813 0.0 33.3 0.22 0.240 0.29 0.34 0.40 2.50 34.37 0.069 0.084 0.112 40.0 50.0 0.30 0.35 0.365 0.47 0.61 0.72 7.00 35.15 2.814 4.212 3.412 14.3 11.4 0.14 0.20 0.23 0.250 0.30 0.34 0.39 2.50 39.50 2.288 2.630 2.373 0.0 8.3 KNM [S] 0.08 0.10 0.13 0.150 0.19 0.23 0.28 2.00 21.42 40.500 15.544 19.545 12.5 9.7 5115 ALAM [S] 0.03 0.05 0.07 0.075 0.12 0.14 0.16 9.00 40.17 9.268 3.437 4.464 0.0 11.1 22 3395 BJCORP 0.13 0.15 0.17 0.190 0.23 0.26 0.29 2.00 52.87 44.918 12.504 5.607 66.7 66.7 23 5843 KPS [S] 0.52 0.59 0.66 0.700 0.91 0.99 1.05 5.25 40.90 0.483 0.330 1.147 12.5 8.2 24 5932 BPURI 0.05 0.06 0.07 0.080 0.12 0.14 0.16 4.00 45.46 8.115 5.234 20.926 0.0 0.0 25 2194 MMCCORP [S] 0.45 0.55 0.64 0.720 0.85 0.94 1.06 1.63 41.36 3.298 5.916 2.283 5.3 15.5 No. Stock Stock Code Name SL S2 S1 6/Nov R1 R2 R3 Ratio 1 6807 PUNCAK [S] 0.13 0.16 0.19 0.210 0.24 0.28 0.32 1.50 54.21 0.338 0.567 2 5256 REACH [S] 0.01 0.03 0.05 0.080 0.10 0.13 0.15 0.67 55.77 0.499 3 5187 HBGLOB 0.09 0.11 0.13 0.150 0.18 0.20 0.22 1.50 51.24 5.376 4 5101 EVERGRN [S] 0.14 0.18 0.20 0.300 0.32 0.37 0.40 0.20 62.29 5 5657 PARKSON [S] 0.06 0.08 0.10 0.130 0.16 0.20 0.25 1.00 6 8702 TEXCHEM 0.36 0.47 0.56 0.675 0.75 0.92 1.09 7 4251 IBHD [S] 0.12 0.14 0.16 0.175 0.23 0.27 8 3778 MELEWAR [S] 0.12 0.14 0.16 0.215 0.27 9 5098 MASTEEL [S] 0.20 0.23 0.25 0.310 10 5202 MSM [S] 0.35 0.40 0.45 11 5038 KSL [S] 0.35 0.40 12 5205 SENDAI [S] 0.12 13 9342 ANZO [S] 14 7028 15 4243 16 RSI 5d-avg 20d-avg Stochastics %K Stop-loss Support 2 Support 1 Current price Resistance 1 Resistance 2 Resistance 3 Reward today Volume (mn Shares) today 5d-avg 20d-avg Stochastics %K %D 1.378 57.1 52.4 1.966 2.080 100.0 77.8 3.570 7.698 60.0 46.5 11.193 21.031 11.765 91.7 82.6 53.78 37.282 21.790 33.696 62.5 53.0 0.65 55.69 0.548 1.259 1.929 30.0 26.7 0.31 3.67 49.90 0.102 0.466 0.733 66.7 66.7 0.31 0.38 1.00 55.71 0.789 0.228 0.361 83.3 64.0 0.39 0.45 0.53 1.33 62.61 0.993 0.297 0.334 87.5 66.1 0.510 0.60 0.69 0.80 1.50 54.10 0.471 0.445 1.230 69.2 47.2 0.43 0.465 0.60 0.66 0.72 3.86 31.86 0.913 0.771 1.130 25.0 27.5 0.14 0.17 0.220 0.24 0.27 0.30 0.40 44.68 0.991 2.423 2.010 60.0 70.0 0.03 0.05 0.07 0.085 0.14 0.16 0.20 3.67 #N/A N/A 29.565 9.948 9.726 75.0 56.7 ZECON [S] 0.22 0.28 0.36 0.470 0.49 0.55 0.60 0.18 57.41 0.445 0.219 0.536 86.7 56.7 WTK [S] 0.26 0.30 0.36 0.455 0.47 0.53 0.58 0.16 57.27 0.983 1.247 0.745 87.5 89.8 8893 MKLAND [S] 0.08 0.10 0.12 0.125 0.17 0.19 0.22 9.00 42.27 0.713 0.838 0.602 25.0 33.3 17 7073 SEACERA [S] 0.18 0.20 0.22 0.250 0.29 0.34 0.40 1.33 47.98 0.032 0.060 0.091 100.0 91.7 18 9679 WCT [S] 0.24 0.30 0.35 0.395 0.47 0.61 0.72 1.67 56.39 4.286 4.576 3.807 80.0 61.7 19 4235 LIONIND [S] 0.14 0.20 0.23 0.280 0.30 0.34 0.39 0.40 57.90 21.339 2.132 2.566 58.3 54.4 20 7164 KNM [S] 0.08 0.10 0.13 0.165 0.19 0.23 0.28 0.71 43.93 12.292 21.065 18.586 71.4 64.3 21 5115 ALAM [S] 0.03 0.05 0.07 0.075 0.12 0.14 0.16 9.00 44.51 1.670 10.425 5.371 50.0 58.3 22 3395 BJCORP 0.13 0.15 0.17 0.195 0.23 0.26 0.29 1.40 56.61 14.637 51.701 17.955 42.9 44.4 23 5843 KPS [S] 0.52 0.59 0.66 0.735 0.91 0.99 1.05 2.33 50.82 0.292 0.619 0.701 69.2 58.0 24 5932 BPURI 0.05 0.06 0.07 0.085 0.12 0.14 0.16 2.33 52.28 7.326 8.603 14.212 66.7 55.6 25 2194 MMCCORP [S] 0.45 0.55 0.64 0.780 0.85 0.94 1.06 0.50 63.86 2.578 2.469 2.732 68.4 54.4 Sources: Bloomberg, TA Securities Legend: Reward Ratio = (R1 - CP)/ (CP - S1) Where CP = Current Price Upgrade in price levels shaded dark green and bold Downgrade in price levels lightly shaded RSI: The Relative Strength Index (RSI) is used to measure the velocity of a security's price movement to identify overbought and oversold conditions. RSI reading below 30 indicates an oversold condition, while RSI value greater than 70 indicates overbought condition. Stochastics: measures the velocity of a security's price movement to identify overbought and oversold conditions. The indicator measures current price relative to highs and lows over a time period. When Reward Ratio increase to > 1; RSI < 30 & Stochastics %K & %D < 30 = oversold; look to BUY When Reward Ratio decrease to < 1; RSI > 70 & Stochastics %K & %D > 70 = overbought; look to SELL Page 2 of 2
83. Technical View Monday , November 09, 2020 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Weekly Stock Screen Malaysia End Day Census of 06.11.2020 Chartist: Stephen Soo Tel: +603-2167 9607 stsoo@ta.com.my www.taonline.com.my Report Description: The Weekly Stock Screen is a retail product which can be a very useful guide for momentum trading and trading ideas. The following list is derived from the screening of more than 1000 stocks currently listed on Bursa Malaysia to identify: the top 20 breakout, 20 breakdown, and 20 ‘potential’ breakout stocks which just climbed above the middle Bollinger band, with potential to appreciate toward the upper Bollinger band. This report also includes the top 20 overbought, and top 20 oversold stocks. *Note: To qualify in the list below, the first sorting criteria is stock price must have just climbed or stayed ABOVE the middle Bollinger Band, followed by a second criteria that trading volume for the day must be significantly strong. This is a good watch list for momentum traders looking for short-term BUY ideas, as they are laggards with good upside potential towards the upper Bollinger band or higher to TAKE PROFIT/SELL. Caveat: Some stocks may continue to stay range bound and trade sideways, hence traders should refer to their respective daily charts to spot accumulation (volume growth) or breakout patterns. [MIDDLE BOLLINGER RANGEBOUND] List of 20 Potential Breakout Stocks (Short-term BUY for upside toward Upper Bollinger Band or higher to TAKE PROFIT/ SELL) No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Stock Name RUBBEREX CORP M BHD NATIONWIDE EXPRESS HOLDINGS GENTING PLANTATIONS BHD HONG LEONG FINANCIAL GROUP KUALA LUMPUR KEPONG BHD SARAWAK CONSOLIDATED INDUSTR RAPID SYNERGY BHD BRITISH AMERICAN TOBACCO BHD VITROX CORP BHD GLOBETRONICS TECHNOLOGY BHD MCE HOLDINGS BHD IOI CORP BHD EONMETALL GROUP BHD CLASSIC SCENIC BHD LEADER STEEL HOLDINGS BHD PETRONAS CHEMICALS GROUP BHD INTEGRATED LOGISTICS BHD AMMB HOLDINGS BHD SARAWAK OIL PALMS BERHAD MALPAC HOLDINGS BERHAD Price 2.55 0.50 9.90 14.64 22.76 3.78 6.43 10.22 15.02 2.97 1.48 4.45 0.51 0.78 0.51 6.20 0.51 3.00 3.65 0.60 Bollinger Band Lower Middle Upper 1.92 2.42 2.91 -0.16 0.30 0.77 9.54 9.82 10.11 13.97 14.41 14.84 21.12 22.03 22.94 3.43 3.94 3.69 5.51 6.03 6.56 9.87 10.10 10.33 12.56 13.83 15.11 2.61 2.83 3.06 0.99 1.27 1.54 4.22 4.37 4.51 0.29 0.43 0.57 0.56 0.70 0.83 0.19 0.37 0.56 5.74 5.99 6.24 0.27 0.41 0.55 2.80 2.92 3.04 3.44 3.56 3.68 0.40 0.51 0.63 RSI 14-day 60.30 59.52 52.44 57.42 56.97 57.42 81.66 57.55 72.12 63.13 65.78 54.99 71.01 71.30 75.49 58.93 72.04 57.27 55.83 55.40 5-day 2.24 0.66 9.74 14.16 21.94 3.57 6.39 10.17 14.16 2.83 1.37 4.37 0.49 0.76 0.48 6.03 0.50 2.84 3.52 0.51 Moving Average 10-day 30-day 2.29 2.22 0.45 0.23 9.86 9.81 14.38 14.26 21.98 22.23 3.60 3.68 6.20 5.82 10.05 10.07 14.25 13.38 2.87 2.76 1.36 1.19 4.37 4.39 0.48 0.39 0.76 0.67 0.44 0.33 5.99 5.86 0.46 0.38 2.90 2.93 3.53 3.56 0.51 0.52 50-day 2.02 0.17 9.86 14.00 22.40 3.62 5.71 10.08 13.04 2.76 1.03 4.42 0.37 0.65 0.32 5.77 0.36 2.96 3.63 0.61 Vol 35,427,400 17,748,700 627,100 323,600 1,106,400 1,027,600 143,500 824,100 295,300 4,877,100 2,312,600 1,768,500 2,387,500 731,600 3,076,700 4,406,500 674,800 1,721,100 371,500 1,900 20-day avg vol 27,376,120 15,092,840 269,180 133,295 448,040 907,580 81,545 324,175 217,180 2,364,815 744,340 1,317,600 2,171,905 169,260 1,907,160 2,093,175 269,905 1,583,780 201,300 390 Raw data sourced from Bloomberg INTERPRETATION OF TECHNICAL INDICATORS: Moving Averages: A stock’s short-term trend is bullish if share price stays above the 10-day moving average, and bearish if it stays below. The medium-term trend is positive if share price stays above the 30-day, and negative if it remains below this average. 14-day RSI: A reading below 30 is considered oversold, above 70 is overbought. A rise above 50 with a corresponding share price surge above the 30-day SMA should be taken as a bullish move with good short-term upside potential. A fall below 50 and a simultaneous dip below the 30-day SMA is bearish and imply further near-term downside risk. Bollinger Bands: Variable width bands that narrow during less volatile periods and widen during more volatile periods. As a general rule, in a bearish trend, traders should buy when share price touches the lower band and exit when price touches the middle band. The reverse is true in a bullish trend, ie. buy when price touches the middle band and sell when price touches the upper band. Momentum traders will buy on price breaks above the upper band, and sell when price breaks below the lower band. Alternatively, a sharp move that originates at one band tends to go all the way to the other band, a useful observation when projecting price targets. *Note: To qualify in the breakout list below, the first sorting criteria is stock price must close ABOVE the upper Bollinger Band, followed by a second criteria that trading volume for the day must be significantly higher than the 20-day average volume, which signal a bullish breakout. Caveat: We would caution momentum traders that a highly overbought 14-day RSI reading (> 80) and share price pullback BELOW the upper Bollinger Band are early warning signals to exit buy breakout trades. [UPPER BOLLINGER BREAKOUT] Top 20 Breakout Stocks (Generally BULLISH, but can be short-term TAKE PROFIT/SELL guide) Page 1 of 3
84. No Stock Name 1 HAP SENG CONSOLIDATED 2 LATITUDE TREE HOLDINGS BHD 3 GHL SYSTEMS BERHAD 4 GETS GLOBAL BHD 5 K-STAR SPORTS LTD 6 CHIN TECK PLANTATIONS BHD 7 PMB TECHNOLOGY BHD 8 IJ M PLANTATIONS BHD 9 KKB ENGINEERING BHD 10 AXIATA GROUP BERHAD 11 TA ANN HOLDINGS BERHAD 12 GAMUDA BHD 13 GE-SHEN CORP BHD 14 SOLUTION GROUP BHD 15 VIVOCOM INTERNATIONAL HOLDIN 16 EURO HOLDINGS BHD 17 HEVEABOARD BHD 18 GENETEC TECHNOLOGY BHD 19 SARAWAK PLANTATION BHD 20 IGB BHD Raw data sourced from Bloomberg Price 7 .95 3.51 2.88 1.64 0.83 6.25 3.23 1.83 1.54 3.20 2.85 3.69 0.75 0.84 1.00 2.08 0.62 1.70 2.04 2.60 Bollinger Band Lower 7.01 2.31 1.83 0.53 0.06 5.67 2.67 1.52 1.38 2.61 2.61 3.27 0.57 0.58 0.16 1.75 0.43 1.50 1.89 2.47 Middle 7.35 2.83 2.27 1.01 0.37 5.90 2.90 1.64 1.44 2.88 2.71 3.46 0.64 0.69 0.56 1.90 0.51 1.59 1.95 2.52 Upper 7.69 3.35 2.72 1.48 0.68 6.13 3.13 1.76 1.49 3.15 2.80 3.65 0.71 0.79 0.96 2.04 0.59 1.67 2.02 2.58 RSI 14-day 75.45 82.45 82.72 84.11 96.61 70.64 85.25 67.33 70.34 65.07 65.45 64.68 68.61 68.57 81.72 75.71 79.40 78.35 65.05 66.92 Moving Average 5-day 7.38 3.04 2.41 1.18 0.51 5.98 3.01 1.66 1.43 2.97 2.68 3.40 0.65 0.70 0.78 1.95 0.54 1.61 1.94 2.51 10-day 7.33 2.90 2.33 1.07 0.43 5.94 2.95 1.64 1.43 2.91 2.68 3.41 0.64 0.68 0.62 1.90 0.52 1.60 1.94 2.51 30-day 7.23 2.62 2.17 0.91 0.30 5.89 2.82 1.63 1.43 2.89 2.69 3.44 0.63 0.66 0.51 1.87 0.49 1.57 1.93 2.55 50-day 7.30 2.47 2.10 0.84 0.24 5.90 2.73 1.69 1.47 2.97 2.73 3.44 0.65 0.64 0.48 1.74 0.48 1.57 1.88 2.57 Vol 465,600 251,400 909,500 26,471,800 59,998,200 5,800 80,900 282,700 68,600 3,317,900 785,200 3,020,900 596,700 102,446,500 151,414,000 628,300 9,308,800 39,500 262,600 116,000 20-day avg vol 293,755 194,460 283,150 8,822,605 34,293,380 15,270 55,910 68,720 63,165 3,405,345 79,650 2,010,180 33,050 31,304,740 24,069,470 1,334,285 6,969,705 67,090 65,935 102,790 *Note: As for the top 20 breakdown list below, the sole sorting criteria is stock price must close significantly BELOW the lower Bollinger Band, with the largest distance from the lower band at the top of the table, signaling a severe sell-off which is bearish. Caveat: A stock should bottom out if share price moves ABOVE the falling lower Bollinger Band, which can be a good buy signal for technical rebound upside after the sharp sell-off. [LOWER BOLLINGER BREAKDOWN] Top 20 Breakdown Stocks (Generally BEARISH, but can be short-term BUY guide) No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Stock Name LYSAGHT GALVANIZED STEEL BHD SUNGEI BAGAN RUBBER (M) KIM HIN INDUSTRY BERHAD IREKA CORP BHD SYCAL VENTURES BHD SCOMI GROUP BHD HEKTAR REAL ESTATE INVESTMEN ENCORP BHD SELANGOR DREDGING BHD VELESTO ENERGY BHD CAPITALAND MALAYSIA MALL TRU PEGASUS HEIGHTS BHD TH HEAVY ENGINEERING BHD TA ENTERPRISE BERHAD AE MULTI HOLDINGS BHD DAYA MATERIALS BHD XIDELANG HOLDINGS LTD MERCURY INDUSTRIES BHD MK LAND HOLDINGS BHD GRAND-FLO BHD Price 1.84 2.61 0.65 0.32 0.23 0.02 0.51 0.17 0.46 0.11 0.60 0.02 0.08 0.62 0.15 0.01 0.06 0.63 0.13 0.24 Bollinger Band RSI Moving Average Lower Middle Upper 14-day 5-day 10-day 30-day 50-day 1.91 2.00 2.09 28.65 1.95 1.98 2.05 2.08 2.66 2.77 2.88 33.65 2.69 2.75 2.72 2.63 0.66 0.75 0.85 28.20 0.69 0.72 0.77 0.75 0.33 0.36 0.38 36.31 0.35 0.35 0.36 0.37 0.23 0.25 0.26 36.88 0.24 0.24 0.25 0.26 0.02 0.03 0.04 31.32 0.02 0.03 0.03 0.03 0.51 0.55 0.60 24.56 0.53 0.54 0.56 0.57 0.17 0.18 0.20 38.34 0.18 0.18 0.19 0.19 0.46 0.48 0.50 37.25 0.47 0.47 0.48 0.48 0.11 0.12 0.13 39.80 0.11 0.12 0.12 0.13 0.60 0.62 0.64 33.90 0.61 0.61 0.62 0.64 0.02 0.02 0.03 43.05 0.02 0.02 0.02 0.03 0.07 0.09 0.10 35.82 0.08 0.08 0.09 0.10 0.61 0.62 0.62 59.59 0.62 0.62 0.61 0.61 0.15 0.15 0.16 42.07 0.16 0.15 0.16 0.17 0.01 0.01 0.02 45.90 0.01 0.01 0.01 0.01 0.05 0.06 0.06 46.17 0.06 0.06 0.06 0.06 0.63 0.64 0.66 47.58 0.64 0.64 0.65 0.61 0.12 0.13 0.14 42.27 0.13 0.13 0.13 0.14 0.24 0.25 0.26 45.63 0.25 0.25 0.24 0.25 Raw data sourced from Bloomberg Page 2 of 3 Vol 6,400 8,000 84,200 2,000 253,500 29,535,100 74,100 50,300 9,000 5,191,700 478,700 9,736,900 433,000 440,800 15,319,500 1,164,000 33,226,900 24,500 713,100 240,100 20-day avg vol 6,130 2,010 20,170 11,565 61,290 3,791,995 245,190 60,865 24,850 20,294,900 503,845 42,639,200 2,455,755 826,970 25,047,420 7,745,690 9,243,980 4,475 602,345 1,022,035
85. *Note: The list below is the 20 most overbought of the 1000 over Bursa Malaysia listed stocks with 14-day RSI above 80. It is generally a bearish or SELL list, especially if the readings approach 90. Caveat: The list consists of fundamentally sound stocks, and hence are long-term BUY or HOLD stocks. TOP 20 OVERBOUGHT STOCKS (Generally BEARISH short-term, but are LONG-TERM BUY or HOLD) No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Stock Name Price K-STAR SPORTS LTD UNISEM (M) BERHAD ENG KAH CORP BHD PMB TECHNOLOGY BHD COMPUTER FORMS (MALAYSIA) BH GETS GLOBAL BHD GHL SYSTEMS BERHAD LATITUDE TREE HOLDINGS BHD VIVOCOM INTERNATIONAL HOLDIN RAPID SYNERGY BHD CHEMICAL CO OF MALAYSIA BHD HEVEABOARD BHD GENETEC TECHNOLOGY BHD MIECO CHIPBOARD BERHAD TECHFAST HOLDINGS BHD EURO HOLDINGS BHD LEADER STEEL HOLDINGS BHD HAP SENG CONSOLIDATED AT SYSTEMATIZATION BHD PRESS METAL ALUMINIUM HOLDIN 0.83 6.09 1.05 3.23 1.70 1.64 2.88 3.51 1.00 6.43 2.29 0.62 1.70 0.54 0.62 2.08 0.51 7.95 0.13 5.89 Bollinger Band RSI Moving Average Vol 20-day avg vol Lower Middle Upper 14-day 5-day 10-day 30-day 50-day 0.06 0.37 0.68 96.61 0.51 0.43 0.30 0.24 59,998,200 34,293,380 3.15 4.67 6.19 91.59 5.53 5.15 4.24 3.96 1,845,400 2,353,395 0.82 0.94 1.06 90.65 1.00 0.97 0.90 0.84 21,500 57,560 2.67 2.90 3.13 85.25 3.01 2.95 2.82 2.73 80,900 55,910 0.94 1.41 1.89 84.53 1.60 1.60 1.28 1.21 5,500 7,160 0.53 1.01 1.48 84.11 1.18 1.07 0.91 0.84 26,471,800 8,822,605 1.83 2.27 2.72 82.72 2.41 2.33 2.17 2.10 909,500 283,150 2.31 2.83 3.35 82.45 3.04 2.90 2.62 2.47 251,400 194,460 0.16 0.56 0.96 81.72 0.78 0.62 0.51 0.48 151,414,000 24,069,470 5.51 6.03 6.56 81.66 6.39 6.20 5.82 5.71 143,500 81,545 1.24 1.83 2.43 80.92 2.20 2.02 1.61 1.47 1,695,100 3,115,310 0.43 0.51 0.59 79.40 0.54 0.52 0.49 0.48 9,308,800 6,969,705 1.50 1.59 1.67 78.35 1.61 1.60 1.57 1.57 39,500 67,090 0.40 0.47 0.54 78.23 0.51 0.49 0.44 0.40 2,174,500 2,591,315 0.29 0.46 0.63 78.03 0.54 0.49 0.41 0.40 21,358,100 20,170,690 1.75 1.90 2.04 75.71 1.95 1.90 1.87 1.74 628,300 1,334,285 0.19 0.37 0.56 75.49 0.48 0.44 0.33 0.32 3,076,700 1,907,160 7.01 7.35 7.69 75.45 7.38 7.33 7.23 7.30 465,600 293,755 0.06 0.09 0.12 74.80 0.11 0.10 0.08 0.08 1,055,369,600 244,821,700 5.05 5.47 5.88 74.31 5.57 5.58 5.31 5.26 5,528,300 4,153,935 Raw data sourced from Bloomberg *Note: The list below is the 20 of the most oversold of the 1000 over Bursa Malaysia listed stocks with 14-day RSI close to and below 30, the level below which is considered oversold. It is generally a short-term bullish or BUY list for technical rebound gains, especially if the readings are below 20. Caveat: The list consists of fundamentally weak stocks, and hence could be an AVOID list. TOP 20 OVERSOLD STOCKS (Generally BULLISH short-term, but AVOID fundamentally weak stocks) No Stock Name Price 1 YINSON HOLDINGS BHD 2 DUTCH LADY MILK INDS BHD 3 HEKTAR REAL ESTATE INVESTMEN 4 Y&G CORP BHD 5 KIM HIN INDUSTRY BERHAD 6 DAYANG ENTERPRISE HLDGS BHD 7 LYSAGHT GALVANIZED STEEL BHD 8 SUNWAY REAL ESTATE INVESTMEN 9 AL-SALAM REAL ESTATE INVESTM 10 EA TECHNIQUE M BHD 11 ALLIANZ MALAYSIA BHD 12 SCOMI GROUP BHD 13 UZMA BHD 14 EASTERN & ORIENTAL BHD 15 PERDANA PETROLEUM BHD 16 KSL HOLDINGS BHD 17 GREEN PACKET BHD 18 PANSAR BHD 19 PETRON MALAYSIA REFINING & M 20 SCOMI ENERGY SERVICES BHD Raw data sourced from Bloomberg 4.57 34.50 0.51 0.42 0.65 0.78 1.84 1.36 0.52 0.29 13.16 0.02 0.39 0.36 0.13 0.47 0.46 0.60 3.02 0.07 Bollinger Band RSI Lower Middle Upper 14-day 4.10 4.88 5.65 9.90 33.18 36.32 39.45 16.98 0.51 0.55 0.60 24.56 0.41 0.57 0.73 27.52 0.66 0.75 0.85 28.20 0.73 0.83 0.93 28.60 1.91 2.00 2.09 28.65 1.34 1.46 1.57 30.13 0.49 0.55 0.62 30.71 0.27 0.31 0.34 30.80 12.97 13.48 13.99 31.23 0.02 0.03 0.04 31.32 0.36 0.41 0.47 31.39 0.35 0.37 0.39 31.46 0.11 0.14 0.16 31.61 0.45 0.49 0.53 31.86 0.44 0.48 0.52 31.97 0.57 0.65 0.73 32.24 2.95 3.17 3.40 32.82 0.06 0.08 0.10 32.83 Moving Average 5-day 10-day 30-day 50-day 4.56 4.59 5.14 5.52 34.34 35.14 37.27 38.07 0.53 0.54 0.56 0.57 0.49 0.56 0.64 0.69 0.69 0.72 0.77 0.75 0.77 0.79 0.88 0.97 1.95 1.98 2.05 2.08 1.38 1.43 1.50 1.55 0.52 0.53 0.58 0.61 0.29 0.30 0.32 0.33 13.16 13.29 13.58 13.61 0.02 0.03 0.03 0.03 0.37 0.40 0.43 0.47 0.36 0.37 0.38 0.39 0.12 0.13 0.14 0.16 0.46 0.47 0.49 0.51 0.45 0.47 0.49 0.51 0.60 0.63 0.64 0.66 3.04 3.09 3.22 3.28 0.07 0.07 0.09 0.10 Vol 20-day avg vol 767,700 14,300 74,100 300 84,200 4,118,800 6,400 4,351,500 118,500 32,400 121,100 29,535,100 1,289,300 773,600 38,620,700 912,900 8,235,000 1,366,300 131,700 383,700 1,835,960 10,715 245,190 755 20,170 5,247,950 6,130 2,128,390 88,975 380,815 51,520 3,791,995 1,344,935 400,855 10,090,190 1,130,420 22,397,520 911,550 61,185 226,275 Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy and/ 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. As of Monday, November 09, 2020, the chartist, Stephen Soo, who prepared this report, has interest in the following securities covered in this report: (a) nil Kaladher Govindan – Head of Research TA SECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048 www.ta.com.my Page 3 of 3
86. Monday , 09 November, 2020 TA RESEARCH’S ‘DAILY COMPILED REPORTS’ For Internal Circulation Only Fo re i gn Te ch n ic al R e p o rt s 1. W e e k l y F ore i gn Te ch n i c al St o ck W at ch ( A US ) 2. W e e k l y F ore i gn Te ch n i c al St o ck W at ch ( HK ) 3. W e e k l y F ore i gn Te ch n i c al St o ck W at ch ( F SST I ) 4. W e e k l y F ore i gn Te ch n i c al St o ck W at ch ( U S) Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy and/ 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. Kaladher Govindan – Head of Research TA SECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048 www.ta.com.my
87. Technical View Monday , November 09, 2020 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Weekly Technical Stock Watch Australia Chartist: Stephen Soo Tel: +603-2167 9607 stsoo@ta.com.my BHP GROUP LTD AUD34.67 BOLLINGER BANDS Upper Middle Lower AUD AUD AUD SIMPLE MOVING AVERAGES 37.51 35.48 33.45 10-day 30-day 50-day AUD AUD AUD SELL Recent Signal DMI BOLLINGER BANDS AUD AUD AUD SELL AUD93.40 RIO TINTO LTD SIMPLE MOVING AVERAGES 98.17 94.43 90.69 10-day 30-day 50-day SELL Recent Signal DMI Recent Signal 34.63 35.77 36.39 DAILY MACD Recent Signal Upper Middle Lower www.taonline.com.my AUD AUD AUD 92.97 94.94 96.61 DAILY MACD SELL Page 1 of 5
88. 9-Nov-20 QBE INSURANCE GROUP LTD AUD8 .78 BOLLINGER BANDS Upper Middle Lower AUD AUD AUD 9.40 8.75 8.10 SIMPLE MOVING AVERAGES 10-day 30-day 50-day AUD AUD AUD DMI 8.50 8.77 9.07 DAILY MACD Recent Signal SELL Recent Signal MACQUARIE GROUP BUY AUD135.45 BOLLINGER BANDS SIMPLE MOVING AVERAGES Upper AUD 138.58 10-day AUD 131.75 Middle Lower AUD AUD 132.45 126.31 30-day 50-day AUD AUD 129.21 127.24 BUY Recent Signal DMI Recent Signal DAILY MACD SELL Page 2 of 5
89. 9-Nov-20 WEEKLY FOREIGN STOCK WATCH UPDATE The table below consists of the top 30 ASX 200 Index component stocks , weighted by market capitalization in descending order, with some popular technical indicators. Some other popularly traded stocks are included at the bottom section. The technical BUY/SELL signals on the last two columns are auto generated. Name AS X 200 BHP GROUP LTD RIO TINTO COMMONW BK AUSTR WESTPAC BANKING AUST AND NZ BANK NATL AUST BANK WESFARMERS WOODS IDE PETRO NEWCREST MINING FORTES CUE METALS QBE INS URANCE ORIGIN ENERGY AMP SANTOS MACQUARIE GROUP SUNCORP GROUP ORICA OIL SEARCH COCA-COLA AMATIL AMCOR STOCKLAND ALUMINA COMPUTERSHARE QANTAS AIR WAYS SIMS METAL MGMT Close Bollinger Bands RSI Moving Averages DMI MACD DMI MACD Change High Low 6-Nov Lower Mid Upper 14d 10d 30d 50d DI + DI - ADX Diff Line Signal Diff Recent Signal 6190.20 50.59 6202.30 6139.60 5939.88 6115.72 6291.56 56.36 6053.88 6056.87 6007.98 28.48 24.29 18.20 4.19 7.02 16.96 (9.938) BUY SELL 34.67 93.40 69.79 17.77 19.60 19.57 47.72 18.19 30.72 16.55 8.78 4.28 1.70 4.88 135.45 8.30 15.70 2.81 12.58 16.07 4.39 1.47 12.91 4.55 9.59 0.43 1.45 0.12 0.07 0.13 0.26 0.03 -0.14 1.05 -0.08 0.28 0.07 0.03 -0.07 3.00 0.11 0.22 0.03 -0.02 0.63 0.04 0.03 0.11 -0.01 0.17 34.84 93.72 70.25 17.90 19.68 19.60 48.06 18.47 30.87 16.89 8.79 4.29 1.71 5.00 136.45 8.30 15.77 2.83 12.64 16.24 4.42 1.47 12.95 4.62 9.67 34.51 92.27 69.26 17.68 19.35 19.28 47.53 18.09 30.35 16.48 8.63 4.20 1.67 4.86 132.61 8.12 15.45 2.78 12.58 15.97 4.34 1.43 12.73 4.48 9.45 33.45 90.69 67.86 17.46 18.69 18.50 45.77 17.44 29.07 16.18 8.10 3.99 1.20 4.71 126.31 7.98 15.00 2.58 9.04 14.62 3.84 1.40 12.02 4.13 7.95 35.48 94.43 69.09 18.36 19.31 19.09 47.13 18.22 30.85 16.76 8.75 4.32 1.45 5.04 132.45 8.63 16.02 2.81 11.26 15.51 4.07 1.45 12.76 4.38 8.96 37.51 98.17 70.32 19.26 19.92 19.68 48.49 19.00 32.62 17.34 9.40 4.65 1.70 5.38 138.58 9.29 17.03 3.03 13.48 16.40 4.29 1.50 13.50 4.62 9.97 38.67 40.63 56.35 45.46 58.17 58.98 59.54 51.71 39.09 47.73 42.15 41.80 71.11 47.00 55.72 36.17 41.37 49.36 88.17 51.73 68.40 47.61 53.88 61.31 61.96 34.63 92.97 69.07 18.08 19.31 18.98 46.71 18.02 30.05 16.76 8.50 4.20 1.48 4.97 131.75 8.35 15.58 2.74 12.31 15.13 4.06 1.45 12.47 4.45 9.43 35.77 94.94 67.92 18.01 18.79 18.78 46.53 18.12 30.96 16.64 8.77 4.36 1.41 5.02 129.21 8.64 16.02 2.78 10.71 15.46 4.02 1.43 12.67 4.31 8.62 36.39 96.61 67.22 17.59 18.31 18.22 46.27 18.32 31.30 16.91 9.07 4.59 1.42 5.12 127.24 8.78 16.36 2.86 10.09 15.35 3.89 1.46 12.62 4.16 8.44 20.02 25.01 21.12 18.94 29.70 27.38 27.06 28.62 21.75 23.42 24.62 18.82 41.34 26.07 33.60 11.25 15.47 26.60 55.80 28.89 34.33 17.73 25.99 30.47 28.50 31.37 36.14 27.25 30.66 23.78 20.96 20.06 24.26 34.36 28.43 30.39 26.30 14.42 23.98 24.80 31.42 28.65 22.15 5.02 25.12 13.59 17.98 24.91 20.31 16.04 19.51 (11.35) 20.30 (11.13) 16.53 (6.13) 18.88 (11.72) 24.60 5.92 17.68 6.42 14.12 7.01 13.08 4.36 17.49 (12.61) 12.68 (5.01) 20.58 (5.77) 31.73 (7.48) 27.65 26.92 14.22 2.09 23.37 8.81 24.99 (20.17) 27.15 (13.18) 16.28 4.46 64.58 50.77 14.98 3.78 27.86 20.74 13.25 (0.25) 16.96 1.09 20.57 10.16 34.76 12.45 -0.69 -1.26 0.51 0.01 0.29 0.18 0.18 -0.09 -0.51 0.01 -0.19 -0.12 0.06 -0.07 1.13 -0.18 -0.29 -0.04 0.79 -0.07 0.08 0.00 -0.06 0.10 0.37 -0.58 -1.21 0.57 0.18 0.34 0.25 0.19 -0.13 -0.42 -0.01 -0.19 -0.13 0.02 -0.06 1.66 -0.12 -0.24 -0.04 0.69 -0.05 0.06 0.00 -0.05 0.10 0.31 (0.109) (0.054) (0.055) (0.168) (0.051) (0.073) (0.009) 0.038 (0.090) 0.020 0.000 0.008 0.037 (0.011) (0.527) (0.057) (0.051) (0.002) 0.106 (0.014) 0.017 0.001 (0.002) (0.001) 0.058 SELL SELL SELL SELL BUY BUY BUY BUY SELL SELL SELL SELL BUY BUY BUY SELL SELL BUY BUY BUY BUY SELL BUY BUY BUY SELL SELL SELL SELL SELL SELL SELL BUY SELL BUY BUY BUY BUY SELL SELL SELL SELL SELL BUY SELL BUY BUY SELL SELL BUY INTERPRETATION OF TECHNICAL INDICATORS: Bollinger Bands: Variable width bands that narrow during less volatile periods and widen during more volatile periods. As a general rule, in a bearish trend, traders should buy when share price touches the lower band and exit when price touches the middle band. The reverse is true in a bullish trend, ie. buy when price touches the middle band and sell when price touches the upper band. Momentum traders tend to buy on price breakouts above the upper band, and sell when price breaks down below the lower band. 14-day Relative Strength Index (RSI): A reading below 30 is considered oversold, above 70 is overbought. A rise above 50 with a corresponding share price surge above the 30day moving average should be taken as a bullish move with good short-term upside potential. A fall below 50 and a simultaneous dip below the 30-day average is bearish and imply further near-term downside risk. Moving Averages: A stock’s short-term trend is bullish if share price stays above the 10-day moving average, and bearish if it stays below. The medium-term trend is positive if share price stays above the 30-day average, and negative if it remains below. A longer-term uptrend is intact if share price sustain above the 50-day average, and is deemed broken if it breaches below this level. Directional Movement Indicator (DMI): The DMI is an indicator of trend strength. A positive DMI difference (DMI diff) value is bullish and indicate a higher DI+ vs. DI-, while a negative DMI diff is bearish due to a lower DI+ vs. DI- (DMI diff = DI+ minus DI-). A crossover of DI+ above DI- triggers a BUY signal, while a SELL signal is flashed when the DI+ crosses below the DI-. The Average Directional Movement Index (ADX) indicates the strength of a trend, whether it is up or down. The higher the value of ADX, the stronger the trend. An ADX value above 25 suggests a trending market or stock, while a value below 20 signal congestion or absence of trend. Daily Moving Average Convergence Divergence (MACD): The MACD diff value is derived from the difference between the MACD line (the 12-day EMA minus the 26-day EMA) and the MACD signal line (the 9-day EMA of the MACD). A positive MACD diff value is bullish, while a negative MACD diff is bearish. A BUY signal is generated when the MACD diff rises above zero, and SELL signal sparked when the MACD diff value falls below zero. Page 3 of 5
90. 9-Nov-20 Fundamentals of Foreign Technical Picks Bloomberg Stock Name Ticker BHP AU BHP GROUP LTD RIO AU RIO TINTO LTD CBA AU COMMONW BK AUS TR WBC AU WES TPAC BANKING ANZ AU AUS T AND NZ BANK NAB AU NATL AUS T BANK WES AU WES FARMERS LTD WPL AU WOODS IDE PETRO NCM AU NEWCRES T MINING FMG AU FORTES CUE METALS QBE AU QBE INS URANCE ORG AU ORIGIN ENERGY AMP AU AMP LTD S TO AU S ANTOS LTD MQG AU MACQUARIE GROUP S UN AU S UNCORP GROUP LT ORI AU ORICA LTD OS H AU OIL S EARCH LTD CCL AU COCA-COLA AMATIL AMC AU AMCOR LTD S GP AU S TOCKLAND AWC AU ALUMINA LTD CPU AU COMPUTERS HARE LT QAN AU QANTAS AIRWAYS S GM AU S IMS METAL MGMT Close Target Price % upside 34.67 41.50 93.40 EPS ($) PER(x) 2020 2021 2020 2021 Div Yield(%) 2020 2021 52week Price High Low % Chg YTD 16% 2.00 1.81 12.6 13.9 4.081 3.744 41.47 24.05 -10.92 101.55 8% 6.63 6.23 10.2 10.9 4.921 4.847 107.79 72.77 -6.97 69.79 68.51 -2% 3.90 4.41 17.9 15.8 3.638 4.482 91.05 53.44 -12.65 17.77 20.01 11% 1.42 1.60 12.5 11.1 4.524 6.196 27.79 13.47 -26.66 19.60 21.10 7% 1.59 1.82 12.4 10.8 4.561 6.332 27.29 14.10 -20.42 19.57 20.99 7% 1.45 1.65 13.5 11.8 4.451 5.846 29.18 13.20 -20.54 47.72 45.67 -5% 1.74 1.86 27.4 25.6 3.202 3.416 49.67 29.64 15.69 18.19 25.38 28% 0.52 0.72 25.5 18.5 2.331 3.035 36.29 14.93 -47.09 30.72 35.70 14% 1.44 1.32 15.5 16.9 0.850 0.752 38.15 20.70 1.55 16.55 15.93 -4% 1.81 1.09 6.6 11.1 7.752 4.586 19.56 8.20 54.82 8.78 11.10 21% -0.31 0.49 NA 13.1 1.333 3.371 15.19 7.13 -31.83 4.28 6.35 33% 0.21 0.33 20.9 13.0 4.463 5.561 8.89 3.75 -49.35 1.70 1.62 -5% 0.10 0.11 17.2 15.5 6.000 2.588 1.95 1.01 -5.00 4.88 6.57 26% 0.17 0.25 20.9 14.4 1.127 1.393 9.07 2.73 -40.34 135.45 132.05 -3% 6.06 7.91 22.4 17.1 2.711 4.061 152.35 70.45 -1.74 8.30 10.47 21% 0.66 0.73 12.5 11.4 5.542 6.566 13.70 7.30 -35.96 15.70 18.50 15% 0.82 0.94 19.2 16.7 2.459 3.274 24.27 13.25 -28.57 2.81 3.81 26% 0.02 0.09 102.1 23.2 0.036 0.961 7.91 1.81 -60.22 12.58 12.39 -2% 0.43 0.52 29.3 24.3 2.186 3.355 13.18 7.77 13.74 16.07 16.57 3% 0.70 0.74 16.8 15.8 2.981 3.080 16.53 9.86 3.21 4.39 3.99 -10% 0.31 0.32 14.3 13.7 5.513 5.854 5.47 1.72 -4.98 1.47 1.86 21% 0.06 0.06 17.8 17.2 4.096 4.164 2.51 1.30 -36.30 12.91 13.88 7% 0.50 0.57 18.6 16.5 2.262 2.424 18.39 8.27 -23.06 4.55 9.59 4.67 9.20 3% -4% -0.42 0.19 0.36 0.51 NA NA 12.8 18.7 0.637 0.824 1.582 2.263 7.46 11.92 2.02 5.52 -36.01 -10.12 Note: The above data is based on Bloomberg consensus Page 4 of 5
91. 9-Nov-20 LIST OF RECOMMENDED BUY STOCKS FROM JUNE 2019 TO CURRENT Stock REC Date ALUMINA ALUMINA ALUMINA BHP GROUP BHP GROUP BHP GROUP COMPUTERSHARE FORTESCUE METALS MACQUARIE MACQUARIE MACQUARIE NATIONAL AUSTRALIA BANK NEWCREST MINING OIL SEARCH OIL SEARCH OIL SEARCH ORICA ORICA ORIGIN ENERGY ORIGIN ENERGY QANTAS AIRWAYS QANTAS AIRWAYS QANTAS AIRWAYS QBE INSURANCE QBE INSURANCE QBE INSURANCE QBE INSURANCE RIO TINTO RIO TINTO RIO TINTO SANTOS LTD SANTOS LTD SANTOS LTD SANTOS LTD SANTOS LTD SUNCORP GROUP SUNCORP GROUP SUNCORP GROUP WESTPAC BANKING WOODSIDE BUY Price 9 /Apr/20 4/Aug/20 8/Sep/20 5/May/20 24/Jun/20 15/Sep/20 5/Mar/20 27/Oct/20 4/Jun/19 6/Sep/19 7/Oct/20 15/Jul/20 21/Oct/20 14/Feb/20 12/Mar/20 20/May/20 4/Feb/20 19/Jun/20 11/Feb/20 31/Mar/20 10/Nov/19 10/Jan/20 30/Jun/20 20/Mar/20 16/Apr/20 29/Sep/20 2/Nov/20 25/Feb/20 15/May/20 5/Nov/20 25/Mar/20 23/Apr/20 22/Jul/20 11/Aug/20 16/Oct/20 3/Feb/20 3/Jul/20 13/Oct/20 4/Dec/19 20/Feb/20 Total funds invested * Total unrealised profit Return 6-Nov-20 Price 1.41 1.53 1.55 30.59 35.64 37.24 13.77 16.61 116.10 125.26 123.40 18.07 32.00 6.42 3.30 3.22 21.98 17.02 7.61 4.43 5.67 6.95 3.62 7.81 8.79 8.79 8.24 95.26 83.26 91.00 91.95 3.99 5.34 5.78 5.24 12.94 8.96 8.91 24.29 33.23 1.47 1.47 1.47 34.67 34.67 34.67 12.91 16.55 135.45 135.45 135.45 19.57 30.72 2.81 2.81 2.81 15.70 15.70 4.28 4.28 4.55 4.55 4.55 8.78 8.78 8.78 8.78 93.40 93.40 93.40 4.88 4.88 4.88 4.88 4.88 8.30 8.30 8.30 17.77 18.19 Change (+/-) 0.06 (0.06) (0.09) 4.08 (0.97) (2.57) (0.86) (0.06) 19.35 10.19 12.05 1.50 (1.28) (3.61) (0.49) (0.41) (6.28) (1.32) (3.33) (0.15) (1.12) (2.40) 0.93 0.97 (0.01) (0.01) 0.54 (1.86) 10.14 2.40 (87.07) 0.89 (0.46) (0.90) (0.36) (4.64) (0.66) (0.61) (6.52) (15.04) pct ST 3.90 (4.25) (5.48) 13.34 (2.72) (6.90) (6.25) (0.36) 16.67 8.14 9.76 8.30 (4.00) (56.23) (14.85) (12.73) (28.57) (7.76) (43.76) (3.39) (19.75) (34.53) 25.69 12.42 (0.11) (0.11) 6.55 (1.95) 12.18 2.64 (94.69) 22.31 (8.61) (15.57) (6.87) (35.86) (7.37) (6.85) (26.84) (45.26) 1,137,170 (80,045) -7.04% Upside Targets MT LT 1.58 1.76 1.90 1.58 1.76 1.90 1.58 1.76 1.90 38.01 42.32 46.63 38.01 42.32 46.63 38.01 42.32 46.63 15.02 15.80 16.42 19.56 22.20 23.85 152.35 171.74 183.70 152.35 171.74 183.70 152.35 171.74 183.70 20.00 21.57 23.18 32.43 34.58 38.87 3.22 3.55 4.09 3.22 3.55 4.09 3.22 3.55 4.09 18.58 19.17 20.14 18.58 19.17 20.14 4.93 5.69 6.30 4.93 5.69 6.30 4.72 5.36 6.15 4.72 5.36 6.15 4.72 5.36 6.15 10.24 11.21 12.17 10.24 11.21 12.17 10.24 11.21 12.17 10.24 11.21 12.17 107.79 116.05 121.16 107.79 116.05 121.16 107.79 116.05 121.16 5.90 6.64 7.57 5.90 6.64 7.57 5.90 6.64 7.57 5.90 6.64 7.57 5.90 6.64 7.57 9.73 10.43 11.23 9.73 10.43 11.23 9.73 10.43 11.23 19.73 20.57 21.61 20.27 23.56 26.22 ST 7.85 7.85 7.85 9.63 9.63 9.63 16.34 18.19 12.48 12.48 12.48 2.20 5.57 14.59 14.59 14.59 18.34 18.34 15.19 15.19 3.74 3.74 3.74 16.63 16.63 16.63 16.63 15.41 15.41 15.41 20.90 20.90 20.90 20.90 20.90 17.23 17.23 17.23 11.03 11.43 % Upside MT 20.14 20.14 20.14 22.07 22.07 22.07 22.39 34.14 26.79 26.79 26.79 10.22 12.57 26.33 26.33 26.33 22.10 22.10 32.94 32.94 17.80 17.80 17.80 27.68 27.68 27.68 27.68 24.25 24.25 24.25 36.07 36.07 36.07 36.07 36.07 25.66 25.66 25.66 15.76 29.52 LT 29.69 29.69 29.69 34.50 34.50 34.50 27.19 44.11 35.62 35.62 35.62 18.45 26.53 45.55 45.55 45.55 28.28 28.28 47.20 47.20 35.16 35.16 35.16 38.61 38.61 38.61 38.61 29.72 29.72 29.72 55.12 55.12 55.12 55.12 55.12 35.30 35.30 35.30 21.61 44.15 Upside Targets ** ST = Short Term (one month) MT = Medium Term (three months) LT = Long Term (above six months) * The portfolio assumes each position consists of 1,000 shares and no deductions for any charges, fees and commision ** Upside Targets are derived from the subsequent Fibonacci Projection levels The above table is a performance summary of our top BUY recommendations from June 2019 to current (sorted by name) together with upside targets, which are taken from subsequent Fibonacci Projection targets which could be achieved in one month (ST), three months (MT) and above six months (LT) from recommendation date. Interpretation: Investors should aim to take profit/sell trading positions when the percentage upside on the last three columns falls to 5% or below (shaded column). A negative percentage value indicates the upside target for the particular time-frame has been breached. Any revision in upside targets will be highlighted in bold. Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy and/ 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. As of Monday, November 09, 2020, the chartist, Stephen Soo, who prepared this report, has interest in the following securities covered in this report: (a) nil Kaladher Govindan – Head of Research TA SECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048 www.ta.com.my Page 5 of 5
92. Technical View Monday , November 09, 2020 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Weekly Technical Stock Watch Hong Kong Chartist: Stephen Soo Tel: +603-2167 9607 stsoo@ta.com.my CHINA MOBILE LTD HKD50.75 BOLLINGER BANDS Upper Middle Lower HKD HKD HKD SIMPLE MOVING AVERAGES 52.11 49.82 47.53 10-day 30-day 50-day HKD HKD HKD SELL Recent Signal DMI BOLLINGER BANDS HKD HKD HKD BUY HKD17.42 CHINA LIFE INSURANCE CO SIMPLE MOVING AVERAGES 19.23 17.98 16.72 10-day 30-day 50-day BUY Recent Signal DMI Recent Signal 49.16 49.96 51.71 DAILY MACD Recent Signal Upper Middle Lower www.taonline.com.my HKD HKD HKD 17.71 17.85 18.12 DAILY MACD SELL Page 1 of 5
93. 9-Nov-20 TENCENT HOLDINGS LTD HKD614 .50 BOLLINGER BANDS Upper Middle Lower HKD HKD HKD 622.25 573.08 523.90 SIMPLE MOVING AVERAGES 10-day 30-day 50-day HKD HKD HKD DMI DAILY MACD Recent Signal BUY Recent Signal PING AN INSURANCE GROUP HKD HKD HKD BUY HKD81.70 BOLLINGER BANDS Upper Middle Lower 592.00 552.92 543.75 SIMPLE MOVING AVERAGES 86.30 82.18 78.05 10-day 30-day 50-day BUY Recent Signal HKD HKD HKD 81.81 81.66 81.87 DAILY MACD Recent Signal SELL Page 2 of 5
94. 9-Nov-20 WEEKLY FOREIGN STOCK WATCH UPDATE The table below consists of the 45 HKSE Hang Seng Index component stocks , sorted by market capitalization in descending order, with some popular technical indicators. Some other popularly traded stocks are included at the bottom section. The technical BUY/SELL signals on the last two columns are auto generated. Clos e Name 6-Nov HANG S E NG 25,712.97 HS BC CH MOBILE CCONB ICBC CNOOC CH LIFE BOC S HK P ROP P E TRO CH TE NCE NT HKS E CK HUTCHIS ON P ING AN S INOP E C CORP CH S HE NHUA CLP BOC HK HS BANK HK&CH GAS S WIRE HL P ROP WHARF CH OV LAND P OWE R AS S E TS HE NDE RS ON BOCOMM CH COAL CH UNICOM BK E AS IA E S P RIT MTR S INO LAND CH RE S NE W WORLD CH RE S LAND CH ME RCHANT CH RE S P OWE R ALCORP CATHAY CITIC COS CO CITIC S E CURITIE S CO GE NHK AIA S ANDS CHINA GALAXY 34.70 50.75 5.84 4.68 7.31 17.42 2.63 103.90 2.30 614.50 381.00 51.50 81.70 3.19 14.00 72.95 22.90 125.60 11.48 38.30 20.70 16.96 20.25 40.60 29.70 4.07 1.99 5.12 14.76 0.84 39.50 9.47 48.85 37.85 35.30 8.93 8.22 1.83 5.53 6.08 4.84 17.40 0.25 80.50 29.50 55.80 Change High Lower 17.05 0.55 0.80 0.06 0.04 (0.02) 0.08 0.04 2.00 0.00 (10.50) (2.20) (1.30) 0.40 0.05 0.24 0.05 0.10 0.90 0.08 0.55 0.10 0.36 0.31 (0.05) 0.25 0.02 0.03 0.04 0.00 (0.01) 0.30 0.07 0.10 0.05 0.15 0.25 0.06 0.04 0.04 0.11 0.07 0.04 0.00 0.20 0.10 0.05 RSI Bollinger Bands Low Mid Upper 14d Moving Averages 10d 30d DMI 50d DI - ADX 25,799.97 25,540.98 23,881.08 24,608.02 25,334.96 66.83 24,787.67 24,269.20 24,517.77 33.46 16.39 16.59 35.00 50.95 5.85 4.68 7.36 17.48 2.63 103.90 2.31 627.00 388.00 52.50 82.20 3.19 14.12 73.30 23.00 125.60 11.50 38.45 20.90 16.96 20.40 40.90 29.70 4.09 2.02 5.22 14.90 0.88 39.50 9.60 49.60 38.05 35.50 8.93 8.25 1.84 5.60 6.10 4.92 17.60 0.26 82.00 30.40 56.50 33.90 50.00 5.74 4.58 7.24 17.24 2.57 102.40 2.27 606.00 380.00 51.10 81.40 3.13 13.76 72.50 22.70 123.50 11.40 37.50 20.25 16.50 20.00 40.45 29.35 4.02 1.96 5.07 14.58 0.81 39.00 9.40 47.90 37.40 34.55 8.70 8.07 1.79 5.51 5.95 4.75 17.26 0.25 80.15 29.30 55.35 29.42 47.53 4.98 3.99 6.95 16.72 2.39 96.15 2.14 523.90 360.09 44.18 78.05 2.94 13.36 71.10 20.70 110.79 11.08 35.65 18.52 15.63 19.01 39.41 27.43 3.73 1.85 4.65 13.84 0.77 38.25 9.23 45.06 36.50 30.46 8.08 7.96 1.64 5.13 5.56 4.39 16.66 0.24 73.71 26.67 50.26 31.90 49.82 5.48 4.44 7.36 17.98 2.52 98.71 2.23 573.08 372.33 47.19 82.18 3.07 13.74 72.79 21.67 118.76 11.26 37.28 19.81 16.07 19.59 40.69 28.66 3.91 1.92 5.23 14.37 0.84 38.82 9.68 47.49 37.87 34.30 8.34 8.42 1.71 5.52 5.77 4.70 17.54 0.25 77.94 28.29 52.78 34.38 52.11 5.97 4.88 7.77 19.23 2.66 101.26 2.32 622.25 384.57 50.19 86.30 3.20 14.12 74.48 22.63 126.73 11.43 38.91 21.10 16.50 20.16 41.98 29.88 4.08 1.99 5.80 14.89 0.90 39.39 10.14 49.93 39.24 38.13 8.61 8.89 1.79 5.91 5.98 5.02 18.42 0.27 82.18 29.91 55.31 32.89 49.16 5.62 4.58 7.25 17.71 2.56 98.76 2.23 592.00 374.12 47.58 81.81 3.09 13.70 72.14 22.00 121.99 11.26 36.73 19.41 16.16 19.43 40.15 28.30 3.95 1.93 5.09 14.36 0.85 38.70 9.54 48.00 37.37 32.64 8.31 8.25 1.72 5.46 5.77 4.64 17.26 0.25 76.82 28.52 53.52 31.14 49.96 5.35 4.31 7.44 17.85 2.49 98.63 2.27 552.92 369.39 47.09 81.66 3.07 13.74 72.82 21.35 117.34 11.23 37.24 19.82 15.82 19.57 40.90 28.62 3.85 1.91 5.22 14.51 0.83 38.98 9.51 47.56 37.72 34.42 8.24 8.49 1.69 5.49 5.78 4.57 17.41 0.26 77.78 28.96 52.75 31.84 51.71 5.40 4.33 7.86 18.12 2.51 99.59 2.39 543.75 372.48 48.19 81.87 3.19 13.47 73.72 21.65 118.82 11.24 38.85 20.36 15.45 20.45 41.72 29.07 3.92 1.91 5.38 15.55 0.85 39.46 9.44 48.72 38.52 35.05 8.47 8.72 1.77 5.76 6.23 4.52 17.65 0.28 78.63 30.83 55.63 37.33 23.86 29.83 29.88 24.53 23.25 27.12 28.73 24.54 34.53 31.30 43.69 26.62 22.10 21.54 18.46 34.35 33.75 28.03 24.41 31.70 30.17 23.69 16.75 30.24 26.71 19.70 28.53 19.42 16.27 22.97 20.98 24.61 16.06 27.46 27.48 11.86 26.16 19.64 24.33 25.18 22.53 15.31 30.21 24.95 23.86 15.85 23.86 19.88 19.81 20.49 23.11 21.12 12.36 17.81 15.77 20.94 9.86 21.20 21.52 16.42 15.45 13.05 13.07 10.75 21.96 22.65 11.76 19.82 18.85 20.67 19.36 14.17 21.19 17.80 16.08 14.71 20.73 16.19 20.96 21.41 13.19 23.36 17.22 22.74 20.09 17.76 19.37 20.30 18.04 26.13 18.59 24.89 18.00 26.47 30.85 16.92 15.23 19.33 15.70 23.08 33.12 14.24 21.87 18.01 17.93 17.21 11.51 23.57 24.18 25.88 21.06 17.74 24.15 23.78 25.81 16.61 26.92 14.16 18.35 26.54 13.82 12.41 21.45 14.48 17.56 23.03 19.13 25.55 17.30 15.63 25.34 NA 11.28 17.02 19.73 26.14 20.10 64.63 49.28 63.03 60.69 46.05 43.80 57.40 63.12 52.11 71.18 57.67 79.05 47.66 52.94 52.94 50.59 67.77 61.08 56.84 52.12 59.87 67.72 52.75 47.69 58.94 58.22 58.16 47.08 50.82 51.18 53.06 45.16 53.45 50.01 56.59 65.87 36.54 57.94 48.08 52.63 55.83 48.86 37.90 58.62 52.61 59.30 DMI MACD DI + Diff Line 17.07 191.86 21.48 (0.00) 9.96 10.07 4.04 0.13 5.99 16.38 6.73 18.76 10.36 33.83 5.42 0.58 5.12 3.01 21.30 20.68 17.28 2.45 9.04 18.41 3.87 (2.10) 9.57 7.34 5.53 7.34 1.62 0.19 8.26 0.25 8.42 (4.90) 6.05 14.29 (11.50) 8.93 (3.09) 4.25 7.42 3.16 (4.99) 12.17 (1.18) 5.27 0.62 -0.78 0.09 0.09 -0.17 -0.24 0.02 0.30 -0.04 20.12 2.12 0.37 -0.37 -0.01 0.02 -0.41 0.26 1.76 0.01 -0.46 -0.13 0.27 -0.25 -0.46 -0.17 0.02 0.01 -0.10 -0.23 0.00 -0.16 -0.03 -0.12 -0.35 -0.72 0.00 -0.19 0.00 -0.08 -0.10 0.03 -0.15 -0.01 -0.25 -0.54 -0.17 Signal 98.97 0.28 -0.82 0.06 0.08 -0.20 -0.12 0.01 -0.14 -0.06 16.78 1.03 -0.26 -0.02 -0.03 0.06 -0.46 0.10 0.81 0.00 -0.60 -0.24 0.25 -0.35 -0.49 -0.23 0.00 0.01 -0.06 -0.39 0.00 -0.23 0.04 -0.29 -0.32 -0.66 -0.05 -0.16 -0.02 -0.07 -0.16 0.05 -0.10 -0.01 -0.43 -0.78 -0.63 Diff 92.89 BUY 0.34 0.03 0.02 0.01 0.03 (0.12) 0.01 0.44 0.02 3.35 1.09 0.64 (0.35) 0.02 (0.04) 0.05 0.15 0.96 0.01 0.14 0.11 0.02 0.10 0.03 0.07 0.02 0.00 (0.04) 0.16 0.00 0.06 (0.06) 0.17 (0.03) (0.06) 0.05 (0.02) 0.01 (0.01) 0.05 (0.02) (0.05) 0.00 0.18 0.24 0.46 MACD Recent Signal BUY SELL BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY SELL BUY BUY BUY BUY BUY BUY BUY BUY BUY SELL BUY BUY SELL BUY SELL BUY BUY BUY SELL BUY SELL BUY BUY BUY BUY BUY BUY BUY SELL BUY BUY BUY BUY BUY BUY SELL BUY SELL BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY BUY SELL BUY BUY BUY SELL BUY SELL SELL BUY SELL BUY SELL BUY SELL SELL BUY BUY BUY BUY INTERPRETATION OF TECHNICAL INDICATORS: Bollinger Bands: Variable width bands that narrow during less volatile periods and widen during more volatile periods. As a general rule, in a bearish trend, traders should buy when share price touches the lower band and exit when price touches the middle band. The reverse is true in a bullish trend, ie. buy when price touches the middle band and sell when price touches the upper band. Momentum traders tend to buy on price breakouts above the upper band, and sell when price breaks down below the lower band. 14-day Relative Strength Index (RSI): A reading below 30 is considered oversold, above 70 is overbought. A rise above 50 with a corresponding share price surge above the 30day moving average should be taken as a bullish move with good short-term upside potential. A fall below 50 and a simultaneous dip below the 30-day average is bearish and imply further near-term downside risk. Moving Averages: A stock’s short-term trend is bullish if share price stays above the 10-day moving average, and bearish if it stays below. The medium-term trend is positive if share price stays above the 30-day average, and negative if it remains below. A longer-term uptrend is intact if share price sustain above the 50-day average, and is deemed broken if it breaches below this level. Directional Movement Indicator (DMI): The DMI is an indicator of trend strength. A positive DMI difference (DMI diff) value is bullish and indicate a higher DI+ vs. DI-, while a negative DMI diff is bearish due to a lower DI+ vs. DI- (DMI diff = DI+ minus DI-). A crossover of DI+ above DI- triggers a BUY signal, while a SELL signal is flashed when the DI+ crosses below the DI-. The Average Directional Movement Index (ADX) indicates the strength of a trend, whether it is up or down. The higher the value of ADX, the stronger the trend. An ADX value above 25 suggests a trending market or stock, while a value below 20 signal congestion or absence of trend. Daily Moving Average Convergence Divergence (MACD): The MACD diff value is derived from the difference between the MACD line (the 12-day EMA minus the 26-day EMA) and the MACD signal line (the 9-day EMA of the MACD). A positive MACD diff value is bullish, while a negative MACD diff is bearish. A BUY signal is generated when the MACD diff rises above zero, and SELL signal sparked when the MACD diff value falls below zero. Page 3 of 5
95. 9-Nov-20 Fundamentals of Foreign Technical Picks Bloomberg Close Target Price Stock Name Ticker 34 .70 36.52 5 HK HS B C 50.75 67.67 941 HK CH MOB ILE 5.84 7.28 939 HK CCONB 4.68 5.82 1398 HK ICB C 7.31 10.90 883 HK CNOOC 17.42 24.75 2628 HK CH LIF E 2.63 3.45 3988 HK B OC 103.90 129.81 16 HK S HK P R OP 2.30 3.27 857 HK P E TR O CH 614.50 630.59 700 HK TE NCE NT 381.00 410.14 388 HK HKS E 51.50 70.39 1 HK CK HUTCHIS ON 81.70 104.63 2318 HK P ING AN 3.19 4.62 386 HK S INOP E C COR P 14.00 17.23 1088 HK CH S HE NHUA 72.95 86.00 2 HK CLP 22.90 27.35 2388 HK B OC HK 125.60 110.96 11 HK HS B ANK 11.48 11.17 3 HK HK&CH GAS 38.30 62.83 19 HK S WIR E 20.70 23.43 101 HK HL P R OP 16.96 17.30 4 HK WHAR F 20.25 32.01 688 HK CH OV LAND 40.60 49.81 6 HK P OWE R AS S E TS 29.70 35.74 12 HK HE NDE R S ON 4.07 5.05 3328 HK B OCOMM 1.99 2.77 1898 HK CH COAL 5.12 7.23 762 HK CH UNICOM 14.76 14.67 23 HK B K E AS IA 0.84 NA 330 HK E S P R IT 39.50 44.17 66 HK MTR 9.47 11.59 83 HK S INO LAND 48.85 57.61 291 HK CH R E S 37.85 47.28 17 HK NE W WOR LD 35.30 44.00 1109 HK CH R E S LAND 8.93 12.64 144 HK CH ME R CHANT 8.22 12.93 836 HK CH R E S P OWE R 1.83 2.32 2600 HK ALCOR P 5.53 6.37 293 HK CATHAY 6.08 N/A 267 HK CITIC 4.84 6.00 1199 HK COS CO 22.89 6030 HK CITIC S E CUR ITIE S CO 17.40 0.25 N/A 678 HK GE NHK 80.50 86.01 1299 HK AIA 29.50 36.73 1928 HK S ANDS CHINA LTD 55.80 62.45 27 HK GALAXY Note: The above data is based on Bloomberg consensus % upside EPS ($) PER(x) 2020 2021 2020 2021 Div Yield(%) 2020 2021 52week Price High Low % Chg YTD 5% 0.2 0.4 19.0 11.2 0.2 0.8 61.20 27.50 -42.97 25% 5.2 5.3 8.3 8.1 5.7 5.8 70.00 45.20 -22.52 20% 1.0 1.0 5.1 4.8 5.0 5.4 6.85 4.93 -13.22 20% 0.8 0.8 5.1 4.8 5.2 5.4 6.11 3.96 -22.00 33% 0.5 0.8 12.3 7.6 4.6 5.7 14.04 6.24 -43.60 30% 1.8 1.9 8.4 7.8 3.7 4.0 22.90 11.64 -19.54 24% 0.6 0.6 4.0 3.8 6.8 7.0 3.39 2.33 -21.02 20% 10.8 11.2 9.6 9.3 4.9 5.0 124.00 87.60 -12.91 30% 0.0 0.1 N/A 17.2 6.3 3.7 4.19 2.16 -40.62 3% 12.7 16.0 41.2 32.9 0.2 0.3 627.00 318.00 63. 60 7% 8.7 10.0 44.0 38.1 2.0 2.4 397.80 206.00 50.59 27% 7.9 9.1 6.5 5.7 4.8 5.4 76.00 45.05 -30.69 22% 7.1 8.4 9.9 8.3 2.6 3.0 101.00 69.00 -11.29 31% 0.2 0.3 16.1 8.3 5.9 6.1 4.73 2.95 -30.24 19% 1.9 1.9 6.3 6.3 7.2 7.2 16.88 11.94 -14.00 15% 4.5 4.7 16.2 15.6 4.3 4.4 84.20 65.00 -10.93 16% 2.6 2.7 8.7 8.5 5.4 6.0 28.90 20.05 -15.34 -13% 9.0 9.5 14.0 13.2 4.2 4.8 173.80 110.00 -21.99 -3% 0.4 0.4 31.9 27.5 3.1 3.2 15.24 10.64 -20.80 39% -1.4 3.6 NA 10.5 4.0 5.6 77.15 35.10 -47.10 12% 1.0 1.1 21.4 19.1 3.7 3.8 22.55 13.78 21.05 2% 1.1 1.8 15.2 9.2 2.4 3.1 22.35 12.04 -14.43 37% 4.0 4.6 5.0 4.4 5.7 6.5 31.00 18.84 -33.28 18% 2.9 3.0 14.0 13.4 6.9 6.9 58.50 39.20 -28.77 17% 3.1 2.9 9.7 10.4 6.1 6.2 40.65 26.05 -22.35 19% 0.9 1.0 3.8 3.6 7.0 7.3 5.68 3.66 -26.53 28% 0.4 0.4 4.2 4.1 5.5 5.8 3.22 1.75 -35.60 29% 0.4 0.5 10.5 9.1 3.2 3.7 7.90 3.84 -30.25 -1% 0.9 1.3 16.7 11.6 2.9 4.4 19.98 13.80 -15.17 NA -0.4 -0.2 N/A NA N/A NA 1.82 0.54 -46.50 11% 1.0 1.7 38.9 23.7 3.1 3.2 47.80 36.20 -14.22 18% 1.4 1.1 6.9 8.3 6.3 6.4 12.34 8.03 -16.34 15% 0.8 1.2 51.4 36.2 0.6 1.0 55.95 30.45 13.34 20% 3.3 3.9 11.5 9.7 5.5 5.7 47.12 29.84 -11.40 20% 3.4 4.0 8.8 7.5 3.5 4.0 40.45 27.05 -9.02 29% 1.0 1.2 8.9 7.4 5.7 6.0 14.06 7.75 -32.25 36% 1.8 2.0 4.6 4.0 8.5 9.7 11.48 6.42 -24.86 21% 0.0 0.1 48.9 22.3 0.0 0.0 2.82 1.40 -31.46 13% -3.4 -0.4 NA NA 0.1 0.8 10.23 5.07 -44.89 N/A 1.7 1.9 3.6 3.1 6.9 8.1 10.74 5.51 -41.65 19% 0.1 0.1 6.9 6.9 0.8 0.8 6.70 3.30 -24.14 24% 1.3 1.5 11.4 9.9 3.4 3.8 21.45 12.60 -2.14 N/A N/A N/A N/A N/A N/A N/A 0.88 0.25 -67.53 6% 0.4 0.6 24.0 18.6 0.2 0.2 87.80 60.05 -1.59 20% -0.2 0.2 NA 22.1 0.2 0.6 45.45 25.15 -29.17 11% -0.9 2.4 NA 23.7 0.3 1.4 63.70 36.62 -1.78 Page 4 of 5
96. 9-Nov-20 LIST OF RECOMMENDED BUY STOCKS FROM JUNE 2019 TO CURRENT Stock AIA GROUP AIA GROUP AIA GROUP BANK OF CHINA BANK OF EAST ASIA CATHAY PACIFIC CATHAY PACIFIC CHINA LIFE CHINA LIFE CHINA LIFE CHINA MOBILE CHINA MOBILE CHINA MOBILE CHINA MOBILE CHINA UNICOM CHINA UNICOM CHINA UNICOM CLP HOLDINGS CNOOC CNOOC CNOOC COSCO COSCO COSCO GALAXY ENTERTAINMENT GALAXY ENTERTAINMENT GALAXY ENTERTAINMENT HSBC HSBC HSBC ICBC ICBC ICBC PING AN PING AN PING AN PING AN POWER ASSETS POWER ASSETS SANDS CHINA SANDS CHINA SANDS CHINA SANDS CHINA SWIRE PACIFIC REC BUY Date Price 07 /Aug/19 24/Sep/19 13/Nov/19 01/Apr/20 28/Oct/20 25/Jun/19 06/Apr/20 03/Oct/19 23/Jun/20 09/Oct/20 21/Feb/20 18/Jun/20 11/Sep/20 01/Oct/20 18/Feb/20 11/Jun/20 06/Oct/20 19/Aug/20 18/Oct/19 10/Mar/20 29/May/20 19/Jul/19 11/Dec/19 12/Feb/20 21/Aug/19 27/Mar/20 17/Jul/20 29/Aug/19 03/Mar/20 23/Sep/20 17/Apr/20 04/Jun/20 15/Oct/20 19/Mar/20 24/Apr/20 07/Jul/20 04/Nov/20 08/Jan/20 21/May/20 26/Feb/20 21/Apr/20 18/Sep/20 22/Oct/20 01/Jul/20 Total funds invested * Total unrealised profit Return 6-Nov-20 Price 75.50 74.90 80.35 2.97 14.12 11.80 10.16 18.16 15.88 18.06 66.75 54.15 53.15 49.45 6.79 4.64 5.09 76.15 11.94 12.94 8.80 7.34 6.15 5.77 49.25 44.30 53.30 56.05 52.80 28.70 5.09 5.14 4.26 74.45 78.10 86.15 79.70 57.75 48.00 38.40 31.75 33.25 27.90 41.10 80.50 80.50 80.50 2.63 14.76 5.53 5.53 17.42 17.42 17.42 50.75 50.75 50.75 50.75 5.12 5.12 5.12 72.95 7.31 7.31 7.31 4.84 4.84 4.84 55.80 55.80 55.80 34.70 34.70 34.70 4.68 4.68 4.68 81.70 81.70 81.70 81.70 40.60 40.60 29.50 29.50 29.50 29.50 38.30 Change (+/-) 5.00 5.60 0.15 (0.34) 0.64 (6.27) (4.63) (0.74) 1.54 (0.64) (16.00) (3.40) (2.40) 1.30 (1.67) 0.48 0.03 (3.20) (4.63) (5.63) (1.49) (2.50) (1.31) (0.93) 6.55 11.50 2.50 (21.35) (18.10) 6.00 (0.41) (0.46) 0.42 7.25 3.60 (4.45) 2.00 (17.15) (7.40) (8.90) (2.25) (3.75) 1.60 (2.80) 1,586,450 (86,640) -5.46% pct ST 6.62 88.46 7.48 88.46 0.19 88.46 (11.45) 2.86 4.53 16.85 (53.14) 6.00 (45.57) 6.00 (4.07) 20.58 9.70 20.58 (3.54) 20.58 (23.97) 55.23 (6.28) 55.23 (4.52) 55.23 2.63 55.23 (24.59) 5.72 10.34 5.72 0.59 5.72 (4.20) 81.20 (38.78) 8.21 (43.51) 8.21 (16.93) 8.21 (34.06) 5.05 (21.30) 5.05 (16.12) 5.05 13.30 56.58 25.96 56.58 4.69 56.58 (38.09) 35.61 (34.28) 35.61 20.91 35.61 (8.06) 5.01 (8.95) 5.01 9.86 5.01 9.74 92.72 4.61 92.72 (5.17) 92.72 2.51 92.72 (29.70) 45.60 (15.42) 45.60 (23.18) 29.96 (7.09) 29.96 (11.28) 29.96 5.73 29.96 (6.81) 40.80 Upside Targets MT LT 95.75 100.26 95.75 100.26 95.75 100.26 3.05 3.20 17.19 20.25 6.76 7.40 6.76 7.40 23.35 26.11 23.35 26.11 23.35 26.11 61.43 66.45 61.43 66.45 61.43 66.45 61.43 66.45 6.00 6.88 6.00 6.88 6.00 6.88 85.02 89.78 8.75 9.43 8.75 9.43 8.75 9.43 5.59 6.13 5.59 6.13 5.59 6.13 62.75 68.91 62.75 68.91 62.75 68.91 37.79 39.55 37.79 39.55 37.79 39.55 5.22 5.43 5.22 5.43 5.22 5.43 101.00 109.27 101.00 109.27 101.00 109.27 101.00 109.27 48.06 50.06 48.06 50.06 32.95 35.36 32.95 35.36 32.95 35.36 32.95 35.36 45.05 52.62 ST 9.89 9.89 9.89 8.75 14.16 8.50 8.50 18.14 18.14 18.14 8.83 8.83 8.83 8.83 11.72 11.72 11.72 11.31 12.31 12.31 12.31 4.34 4.34 4.34 1.40 1.40 1.40 2.62 2.62 2.62 7.05 7.05 7.05 13.49 13.49 13.49 13.49 12.32 12.32 1.56 1.56 1.56 1.56 6.53 % Upside MT 18.94 18.94 18.94 15.97 16.46 22.24 22.24 34.04 34.04 34.04 21.04 21.04 21.04 21.04 17.19 17.19 17.19 16.55 19.70 19.70 19.70 15.50 15.50 15.50 12.46 12.46 12.46 8.90 8.90 8.90 11.54 11.54 11.54 23.62 23.62 23.62 23.62 18.37 18.37 11.69 11.69 11.69 11.69 17.62 LT 24.55 24.55 24.55 21.67 37.20 33.82 33.82 49.89 49.89 49.89 30.94 30.94 30.94 30.94 34.38 34.38 34.38 23.07 29.00 29.00 29.00 26.65 26.65 26.65 23.49 23.49 23.49 13.98 13.98 13.98 16.03 16.03 16.03 33.75 33.75 33.75 33.75 23.30 23.30 19.86 19.86 19.86 19.86 37.39 Upside Targets ** ST = Short Term (one month) MT = Medium Term (three months) LT = Long Term (above six months) * The portfolio assumes each position consists of 1,000 shares and no deductions for any charges, fees and commision ** Upside Targets are derived from the subsequent Fibonacci Projection levels The above table is a performance summary of our top BUY recommendations from June 2019 to current (sorted by name) together with upside targets, which are taken from subsequent Fibonacci Projection targets which could be achieved in one month (ST), three months (MT) and above six months (LT) from recommendation date. Interpretation: Investors should aim to take profit/sell trading positions when the percentage upside on the last three columns falls to 5% or below (shaded column). A negative percentage value indicates the upside target for the particular time-frame has been breached. Any revision in upside targets will be highlighted in bold. Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy and/ 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. As of Monday, November 09, 2020, the chartist, Stephen Soo, who prepared this report, has interest in the following securities covered in this report: (a) nil Kaladher Govindan – Head of Research TA SECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048 www.ta.com.my Page 5 of 5
97. Technical View Monday , November 09, 2020 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Weekly Technical Stock Watch Singapore Chartist: Stephen Soo Tel: +603-2167 9607 stsoo@ta.com.my DBS GROUP HOLDINGS SGD22.49 BOLLINGER BANDS Upper Middle Lower SGD SGD SGD SIMPLE MOVING AVERAGES 22.14 21.27 20.40 10-day 30-day 50-day SGD SGD SGD DMI BUY Recent Signal OCBC LTD SGD SGD SGD BUY SGD8.93 BOLLINGER BANDS SIMPLE MOVING AVERAGES 8.92 8.67 8.41 10-day 30-day 50-day BUY Recent Signal DMI Recent Signal 21.20 20.98 20.76 DAILY MACD Recent Signal Upper Middle Lower www.taonline.com.my SGD SGD SGD 8.62 8.63 8.60 DAILY MACD BUY Page 1 of 5
98. 9-Nov-20 UOB LTD SGD20 .45 BOLLINGER BANDS Upper Middle Lower SGD SGD SGD SIMPLE MOVING AVERAGES 20.32 19.63 18.94 10-day 30-day 50-day SGD SGD SGD BUY Recent Signal DMI DAILY MACD Recent Signal STARHUB LTD SGD SGD SGD SELL SGD1.20 BOLLINGER BANDS Upper Middle Lower 19.58 19.53 19.47 SIMPLE MOVING AVERAGES 1.26 1.21 1.16 10-day 30-day 50-day SGD SGD SGD 1.19 1.21 1.20 DAILY MACD Recent Signal SELL Recent Signal SELL Page 2 of 5
99. 9-Nov-20 WEEKLY FOREIGN STOCK WATCH UPDATE The table below consists of the revamped 30 SGX FTSE Straits Times Index component stocks , sorted by market capitalization in descending order, with some popular technical indicators. Some other popularly traded stocks are included at the bottom section. The technical BUY/SELL signals on the last two columns are auto generated. Stock Name Close 6-Nov FS S TI Bollinger Bands Mid Upper RSI 14d Moving Averages 30d 50d MACD Line Signal Diff DMI MACD Recent Signal 2,512.88 2,508.58 38.84 24.65 19.15 14.20 -2.12 -5.53 3.41 BUY BUY 2.08 2.13 2.17 27.96 20.30 28.42 7.65 -0.03 -0.03 0.01 BUY BUY 21.20 20.98 20.76 42.47 19.73 22.33 22.74 0.20 0.14 0.06 BUY BUY BUY Change High Low 2,578.68 (9.94) 2,591.96 2,562.86 2,437.75 2,518.40 2,599.05 63.26 2,497.65 S INGTEL 2.15 (0.04) 2.19 2.11 2.01 2.12 2.23 58.75 DBS 22.49 0.06 22.58 22.17 20.40 21.27 22.14 68.09 Lower 10d DMI DI + DI - ADX Diff OCBC 8.93 0.00 8.96 8.83 8.41 8.67 8.92 64.88 8.62 8.63 8.60 35.71 19.45 16.99 16.26 0.01 0.00 0.01 BUY UOB 20.45 0.01 20.58 20.22 18.94 19.63 20.32 65.94 19.58 19.53 19.47 38.81 16.75 19.51 22.06 0.06 0.02 0.04 BUY BUY J ARDINE M. 45.80 0.00 45.80 45.03 40.60 43.72 46.84 64.62 45.12 42.89 41.97 28.56 12.34 27.40 16.22 1.13 0.94 0.19 BUY BUY WILMAR 4.33 0.01 4.36 4.32 3.96 4.33 4.71 50.32 4.20 4.38 4.36 21.78 29.21 28.34 (7.43) -0.05 -0.06 0.00 SELL BUY HK LAND 3.90 0.00 3.91 3.86 3.69 3.79 3.90 60.22 3.79 3.77 3.79 23.96 16.70 14.56 7.26 0.00 0.01 BUY BUY SELL 0.01 CAPLAND 2.62 (0.01) 2.66 2.61 2.51 2.69 2.87 43.78 2.61 2.71 2.72 13.36 27.56 34.20 (14.20) -0.05 -0.04 (0.01) SELL GENS P 0.69 0.01 0.69 0.67 0.64 0.67 0.70 54.37 0.66 0.67 0.68 24.35 16.23 20.33 8.13 -0.01 -0.01 0.00 BUY BUY KEPPEL 4.65 (0.02) 4.68 4.61 4.30 4.49 4.67 62.50 4.44 4.45 4.39 35.00 18.06 18.71 16.94 0.01 0.00 0.01 BUY BUY S GX 9.11 0.01 9.13 9.02 8.67 9.03 9.38 56.00 8.91 9.06 8.92 30.66 24.81 22.91 5.85 -0.03 -0.01 (0.02) BUY SELL S IA 3.48 0.01 3.50 3.44 3.37 3.50 3.62 47.65 3.48 3.49 3.52 21.62 23.15 12.41 (1.53) -0.02 -0.01 (0.01) SELL SELL BUY FNN 1.19 0.00 1.19 1.18 1.15 1.19 1.23 46.15 1.18 1.20 1.23 15.38 29.41 36.43 (14.02) -0.02 -0.02 0.00 SELL CITY DEV 6.56 (0.04) 6.63 6.51 5.90 7.09 8.27 34.60 6.56 7.30 7.57 14.52 41.77 44.70 (27.25) -0.37 -0.33 (0.05) SELL SELL J ARDINE S . 21.94 (0.06) 22.08 21.83 19.69 21.30 22.91 57.71 22.01 21.05 20.69 28.93 23.72 18.04 5.21 0.47 0.37 0.10 BUY BUY S G PRES S 1.00 0.00 1.01 1.00 0.97 1.01 1.05 43.25 1.00 1.02 1.04 14.30 14.00 13.89 0.29 -0.01 -0.01 0.00 BUY BUY J ARDINE C&C 19.04 0.79 19.18 18.32 17.47 18.24 19.02 49.70 18.29 18.22 18.30 19.41 22.92 15.44 (3.51) -0.06 -0.04 (0.03) SELL SELL GOLDEN AGRI 0.14 0.00 0.14 0.14 0.14 0.14 0.15 46.01 0.14 0.14 0.14 14.22 20.18 25.48 (5.96) 0.00 0.00 (0.00) SELL SELL S G TECH 3.56 (0.06) 3.62 3.54 3.49 3.60 3.71 57.55 3.58 3.57 3.51 25.08 19.02 30.08 6.06 0.01 0.02 (0.01) BUY SELL OLAM INT 1.32 0.00 1.32 1.31 1.27 1.30 1.33 58.77 1.29 1.29 1.29 20.93 13.26 14.39 7.67 0.00 0.00 0.00 BUY BUY CAPTALAND INT 1.87 (0.02) 1.90 1.83 1.72 1.87 2.01 52.44 1.81 1.90 1.93 25.56 25.50 34.17 0.07 -0.04 -0.04 (0.00) BUY SELL BUY S EMBCORP 1.66 (0.02) 1.69 1.65 1.27 1.49 1.71 77.02 1.59 1.44 1.32 38.28 2.11 73.08 36.18 0.10 0.09 0.01 BUY S EMCORP M. 0.12 (0.00) 0.13 0.12 0.11 0.13 0.15 35.80 0.13 0.14 0.15 12.90 33.16 46.76 (20.26) -0.01 -0.01 0.00 SELL BUY CMFT DELGRO 1.42 (0.02) 1.45 1.41 1.35 1.43 1.51 53.59 1.40 1.43 1.45 23.64 17.98 22.91 5.66 -0.02 -0.02 (0.00) BUY SELL S TARHUB 1.20 0.01 1.20 1.18 1.16 1.21 1.26 45.61 1.19 1.21 1.20 13.77 22.01 24.40 (8.24) -0.01 -0.01 (0.01) SELL SELL S IA ENG 1.61 0.00 1.64 1.61 1.62 1.70 1.78 33.60 1.67 1.69 1.75 18.14 28.44 13.20 (10.30) -0.03 -0.02 (0.01) SELL SELL BUY SELL IFOOD AGRI 0.30 0.01 0.30 0.29 0.28 0.29 0.30 54.91 0.29 0.29 0.29 25.40 30.58 17.11 (5.18) 0.00 0.00 0.00 SELL YZJ 0.94 0.00 0.95 0.92 0.91 0.96 1.00 44.24 0.94 0.97 0.96 17.19 21.99 19.46 (4.80) -0.01 -0.01 (0.00) SELL INTERPRETATION OF TECHNICAL INDICATORS: Bollinger Bands: Variable width bands that narrow during less volatile periods and widen during more volatile periods. As a general rule, in a bearish trend, traders should buy when share price touches the lower band and exit when price touches the middle band. The reverse is true in a bullish trend, ie. buy when price touches the middle band and sell when price touches the upper band. Momentum traders tend to buy on price breakouts above the upper band, and sell when price breaks down below the lower band. 14-day Relative Strength Index (RSI): A reading below 30 is considered oversold, above 70 is overbought. A rise above 50 with a corresponding share price surge above the 30-day moving average should be taken as a bullish move with good short-term upside potential. A fall below 50 and a simultaneous dip below the 30-day average is bearish and imply further near-term downside risk. Moving Averages: A stock’s short-term trend is bullish if share price stays above the 10-day moving average, and bearish if it stays below. The medium-term trend is positive if share price stays above the 30-day average, and negative if it remains below. A longer-term uptrend is intact if share price sustain above the 50-day average, and is deemed broken if it breaches below this level. Directional Movement Indicator (DMI): The DMI is an indicator of trend strength. A positive DMI difference (DMI diff) value is bullish and indicate a higher DI+ vs. DI-, while a negative DMI diff is bearish due to a lower DI+ vs. DI- (DMI diff = DI+ minus DI-). A crossover of DI+ above DI- triggers a BUY signal, while a SELL signal is flashed when the DI+ crosses below the DI-. The Average Directional Movement Index (ADX) indicates the strength of a trend, whether it is up or down. The higher the value of ADX, the stronger the trend. An ADX value above 25 suggests a trending market or stock, while a value below 20 signal congestion or absence of trend. Daily Moving Average Convergence Divergence (MACD): The MACD diff value is derived from the difference between the MACD line (the 12-day EMA minus the 26-day EMA) and the MACD signal line (the 9-day EMA of the MACD). A positive MACD diff value is bullish, while a negative MACD diff is bearish. A BUY signal is generated when the MACD diff rises above zero, and SELL signal sparked when the MACD diff value falls below zero. Page 3 of 5
100. 9-Nov-20 Fundamentals of Foreign Technical Picks Bloomberg Ticker ST DBS OCBC UOB JM WIL HKL CAPL GENS KEP SGX SIA FNN CIT JS SPH JCNC GGR STE OLAM CT SCI SMM CD STH SIE IFAR YZJSGD SP SP SP SP SP SP SP SP SP SP SP SP SP SP SP SP SP SP SP SP SP SP SP SP SP SP SP SP EPS ($) PER(x) Div Yield(%) 52week Price % Chg Stock Name Close Target Price 2020 2021 2020 2021 2020 2021 High Low YTD SINGTEL DBS OCBC UOB JARDINE M. WILMAR HK LAND CAPLAND GENSP KEPPEL SGX SIA FNN CITY DEV JARDINE S SG PRESS JARDINE C&C GOLDEN AGRI SG TECH OLAM INT CAPITALAND INT SEMBCORP SEMCORP M. CMFT DELGRO STARHUB SIA ENG IFOOD AGRI YZJ 2.15 2.93 27% 0.1 0.2 16.3 13.2 5.3 5.8 3.48 2.00 -36.20 22.49 24.15 7% 1.8 2.1 12.6 10.8 3.9 4.7 26.80 16.65 -13.10 % upside 8.93 10.15 12% 0.7 0.9 12.0 9.7 3.8 5.1 11.23 7.80 -18.67 20.45 22.65 10% 1.7 2.0 12.1 10.3 3.9 4.9 26.77 17.12 -21.85 45.80 47.87 4% 2.4 3.8 19.2 12.0 3.7 3.8 59.47 37.37 -17.63 4.33 5.17 16% 0.2 0.2 15.2 14.3 2.9 2.4 4.95 2.83 5.10 3.90 5.29 26% 0.4 0.4 9.8 9.1 5.6 5.6 5.90 3.46 -32.17 2.62 3.68 29% 0.2 0.2 13.9 11.5 3.6 4.4 3.97 2.51 -30.13 0.69 0.76 10% 0.0 0.0 NA 22.8 3.8 5.0 0.96 0.51 -25.54 4.65 5.81 20% 0.1 0.4 72.7 11.5 2.4 4.0 6.95 4.08 -31.31 9.11 9.12 0% 0.4 0.4 22.2 22.0 3.6 3.6 10.72 7.96 2.82 3.48 3.56 2% -0.8 -0.1 NA NA 0.2 0.8 6.64 3.20 -45.36 1.19 NA NA NA NA NA NA NA NA 1.78 1.07 -30.81 6.56 10.12 35% 0.2 0.5 27.7 12.3 2.0 2.7 11.43 6.07 -39.67 21.94 NA NA 2.1 2.6 10.7 8.6 1.5 1.7 33.50 17.81 -28.42 1.00 1.04 3% 0.1 0.1 13.5 12.2 4.6 5.4 2.33 0.99 -54.13 19.04 24.17 21% 1.0 1.6 14.7 9.1 2.2 3.2 33.35 16.58 -36.74 0.14 0.14 0% 0.0 0.0 NA 21.1 2.8 2.1 0.27 0.13 -39.57 3.56 3.78 6% 0.2 0.2 21.6 20.7 4.1 4.2 4.42 2.78 -9.64 1.32 NA NA 0.2 0.2 8.3 7.8 5.7 5.7 1.98 1.24 -27.07 1.87 2.25 17% 0.1 0.1 31.2 17.0 4.9 6.3 2.66 1.49 -23.98 1.66 1.72 4% 0.1 0.2 26.3 8.6 1.6 2.8 1.72 0.69 43.90 0.12 0.23 46% -0.1 0.0 NA NA 0.0 0.0 0.89 0.11 -85.51 1.42 1.76 19% 0.0 0.1 41.8 14.3 1.8 4.9 2.45 1.32 -40.34 1.20 1.40 15% 0.1 0.1 14.8 14.6 5.4 5.7 1.55 1.09 -15.49 1.61 1.63 1% 0.0 0.0 #N/A N/A 89.4 2.5 4.7 2.89 1.48 -42.91 0.30 0.29 -2% NA NA NA NA NA NA 0.34 0.24 -9.23 0.94 1.21 22% 0.7 0.7 6.8 6.7 22.2 22.4 1.20 0.73 -16.07 Note: The above data is based on Bloomberg consensus Page 4 of 5
101. 9-Nov-20 LIST OF RECOMMENDED BUY STOCKS FROM JUNE 2019 TO CURRENT Stock CAPITALAND CITY DEVELOPMENTS CITY DEVELOPMENTS CITY DEVELOPMENTS COMFORTDELGRO COMFORTDELGRO DBS GROUP DBS GROUP GENTING SPORE GENTING SPORE HONGKONG LAND HONGKONG LAND HONGKONG LAND JARDINE STRATEGIC KEPPEL CORP KEPPEL CORP KEPPEL CORP KEPPEL CORP OCBC SINGTEL SINGTEL SINGTEL SINGTEL SINGTEL SPORE EXCHANGE SPORE TECH ENG SPORE TECH ENG SPORE TECH ENG SPORE TECH ENG UOB YANGZIJIANG YANGZIJIANG REC BUY Date Price 14 /Oct/20 27/Feb/20 28/Apr/20 9/Jul/20 22/Jan/20 23/Jul/20 24/Mar/20 2/Oct/20 11/Mar/20 26/Jun/20 4/Mar/20 19/May/20 20/Oct/20 5/May/20 2/Mar/20 10/Apr/20 13/Aug/20 23/Oct/20 2/Apr/20 2/Aug/19 2/Oct/19 19/Feb/20 13/May/20 17/Jun/20 3/Jun/20 25/Sep/19 14/Apr/20 16/Jul/20 22/Sep/20 15/Nov/19 7/Apr/20 2/Jul/20 Total funds invested * Total unrealised profit Return 6-Nov-20 Price 2.81 10.37 7.59 8.73 2.22 1.40 16.88 20.40 0.74 0.76 4.98 3.82 3.83 21.90 6.75 5.72 4.88 4.51 8.49 3.36 3.13 3.17 2.74 2.57 8.28 3.88 3.24 3.29 3.41 24.31 0.88 0.94 2.62 6.56 6.56 6.56 1.42 1.42 22.49 22.49 0.69 0.69 3.90 3.90 3.90 21.94 4.65 4.65 4.65 4.65 8.93 2.15 2.15 2.15 2.15 2.15 9.11 3.56 3.56 3.56 3.56 20.45 0.94 0.94 Change (+/-) (0.19) (3.81) (1.03) (2.17) (0.80) 0.02 5.61 2.09 (0.05) (0.08) (1.08) 0.08 0.07 0.04 (2.10) (1.07) (0.23) 0.14 0.44 (1.21) (0.98) (1.02) (0.59) (0.42) 0.83 (0.32) 0.32 0.27 0.15 (3.86) 0.06 0.00 199,975 (10,885) -5.44% Upside Targets pct ST MT LT (6.76) 3.10 3.27 3.43 (36.74) 7.31 8.08 8.70 (13.57) 7.31 8.08 8.70 (24.86) 7.31 8.08 8.70 (36.04) 1.65 1.89 2.12 1.43 1.65 1.89 2.12 33.23 24.06 25.81 28.64 10.25 24.06 25.81 28.64 (7.43) 0.73 0.78 0.84 (9.87) 0.73 0.78 0.84 (21.69) 4.03 4.39 4.68 2.09 4.03 4.39 4.68 1.83 4.03 4.39 4.68 0.18 23.75 25.55 28.46 (31.11) 4.82 5.32 5.64 (18.71) 4.82 5.32 5.64 (4.71) 4.82 5.32 5.64 3.10 4.82 5.32 5.64 5.18 9.92 10.42 11.23 (36.01) 2.50 2.68 2.85 (31.31) 2.50 2.68 2.85 (32.18) 2.50 2.68 2.85 (21.53) 2.50 2.68 2.85 (16.34) 2.50 2.68 2.85 10.02 10.02 10.72 11.44 (8.25) 3.80 4.03 4.42 9.88 3.80 4.03 4.42 8.21 3.80 4.03 4.42 4.40 3.80 4.03 4.42 (15.88) 20.98 22.13 23.27 6.82 1.06 1.15 1.22 0.53 1.06 1.15 1.22 ST 18.32 11.43 11.43 11.43 16.20 16.20 6.98 6.98 6.57 6.57 3.33 3.33 3.33 8.25 3.66 3.66 3.66 3.66 11.09 16.28 16.28 16.28 16.28 16.28 9.99 6.74 6.74 6.74 6.74 2.59 12.77 12.77 % Upside MT 24.81 23.17 23.17 23.17 33.10 33.10 14.76 14.76 13.87 13.87 12.56 12.56 12.56 16.45 14.41 14.41 14.41 14.41 16.69 24.65 24.65 24.65 24.65 24.65 17.67 13.20 13.20 13.20 13.20 8.22 22.34 22.34 LT 30.92 32.62 32.62 32.62 49.30 49.30 27.35 27.35 22.63 22.63 20.00 20.00 20.00 29.72 21.29 21.29 21.29 21.29 25.76 32.56 32.56 32.56 32.56 32.56 25.58 24.16 24.16 24.16 24.16 13.79 29.79 29.79 Upside Targets ** ST = Short Term (one month) MT = Medium Term (three months) LT = Long Term (above six months) * The portfolio assumes each position consists of 1,000 shares and no deductions for any charges, fees and commision ** Upside Targets are derived from the subsequent Fibonacci Projection levels The above table is a performance summary of our top BUY recommendations from June 2019 to current (sorted by name) together with upside targets, which are taken from subsequent Fibonacci Projection targets which could be achieved in one month (ST), three months (MT) and above six months (LT) from recommendation date. Interpretation: Investors should aim to take profit/sell trading positions when the percentage upside on the last three columns falls to 5% or below (shaded column). A negative percentage value indicates the upside target for the particular time-frame has been breached. Any revision in upside targets will be highlighted in bold. Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy and/ 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. As of Monday, November 09, 2020, the chartist, Stephen Soo, who prepared this report, has interest in the following securities covered in this report: (a) nil Kaladher Govindan – Head of Research TA SECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048 www.ta.com.my Page 5 of 5
102. Technical View Monday , November 09, 2020 THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* Weekly Technical Stock Watch United States Chartist: Stephen Soo Tel: +603-2167 9607 stsoo@ta.com.my WALT DISNEY CO USD126.96 BOLLINGER BANDS Upper Middle Lower USD USD USD www.taonline.com.my SIMPLE MOVING AVERAGES 130.26 124.81 119.36 10-day 30-day 50-day USD USD USD BUY Recent Signal 123.32 124.39 127.03 DMI Recent Signal UNITEDHEALTH GROUP INC USD354.40 BOLLINGER BANDS Upper Middle Lower USD USD USD BUY SIMPLE MOVING AVERAGES 350.16 324.76 299.35 10-day 30-day 50-day BUY Recent Signal USD USD USD 323.34 320.67 315.18 DMI Recent Signal BUY Page 1 of 5
103. 9-Nov-20 WALGREENS BOOTS ALLIANCE USD37 .53 BOLLINGER BANDS Upper Middle Lower USD USD USD SIMPLE MOVING AVERAGES 38.95 36.51 34.06 10-day 30-day 50-day USD USD USD 36.04 36.36 36.36 DAILY MACD Recent Signal BUY Recent Signal ALIBABA GROUP HOLDINGS USD287.75 BOLLINGER BANDS Upper Middle Lower USD USD USD SIMPLE MOVING AVERAGES 319.79 304.55 289.31 10-day 30-day 50-day DMI Recent Signal BUY USD USD USD 303.90 298.83 290.71 DAILY MACD SELL Recent Signal SELL Page 2 of 5
104. 9-Nov-20 WEEKLY FOREIGN STOCK WATCH UPDATE The table below consists of the 30 NYSE Dow Jones Industrial Average component stocks , sorted by market capitalization in descending order, with some popular technical indicators. Some other popularly traded stocks are included at the bottom section. The technical BUY/SELL signals on the last two columns are auto generated. Stock Name DOW J ONES Close Change High Low Bollinger Bands RSI Moving Averages DMI 5-Nov Lower Mid Upper 14d 10d 30d 50d DI + 28,390.18 542.52 28,495.05 28,083.37 26,451.62 27,930.26 29,408.90 57.79 27380.77 27,891.58 27,894.65 30.23 DI 26.77 ADX 19.75 Diff 3.46 MACD Line Signal -118.87 -128.30 DMI MACD Diff Recent Signal 9.427 BUY BUY IBM 3M CHEVRON CATERPILLAR MCDONALDS HONEYWELL INTERNATIONAL BOEING S ALES FROCE.COM J &J P&G COCA-COLA WAL-MART TRAVELERS DOWDUPONT GOLDMAN J PMORGAN AMEX MERCK WALT DIS NEY VERIZON HOME DEPOT UTD HEALTH AT&T MICROS OFT CIS CO INTEL AMGEN INC. WALGREENS BOOTS ALLIANCE NIKE VIS A AIG BANK OF AMERICA BP CITIGROUP LV S ANDS MS WELLS FARGO FACEBOOK INC-A APPLE INC ALIBABA GRP-ADR 114.77 163.20 72.14 163.09 216.31 183.28 157.09 260.22 139.76 142.38 49.44 143.47 127.51 60.19 202.96 104.35 98.11 80.46 126.96 58.15 285.85 354.40 27.51 223.29 37.23 45.68 231.97 37.53 129.70 197.64 33.43 24.61 15.83 43.07 52.60 52.20 22.33 294.68 119.03 287.75 37.50 28.71 27.31 27.12 26.24 17.66 29.55 24.41 27.06 23.19 23.82 20.83 18.64 19.89 23.41 26.75 31.44 20.32 19.97 25.65 24.51 18.53 28.97 22.66 28.45 33.79 27.48 22.49 22.02 23.24 20.16 28.79 34.07 27.37 16.47 21.92 32.31 19.78 21.61 27.69 23.15 17.46 25.50 22.07 32.61 18.26 16.71 21.71 16.85 19.81 16.86 19.53 18.41 10.89 17.61 13.50 21.74 23.91 14.99 30.01 19.29 20.64 14.56 18.39 28.53 31.42 29.57 18.19 25.30 23.76 24.45 13.66 34.06 16.58 18.87 16.07 20.50 14.11 16.39 27.67 (11.22) (8.63) (7.66) 0.53 (11.57) 13.19 (7.70) 3.05 (5.23) 0.64 (2.08) 1.81 10.21 6.01 4.12 4.82 (9.34) 11.45 5.43 (4.40) 1.40 24.61 0.12 7.87 (10.63) (14.34) (2.12) 4.27 3.05 5.17 12.81 (2.20) (10.34) (3.09) 14.53 5.03 (12.65) 10.34 4.28 (9.35) -2.83 -0.90 -1.08 1.75 -1.74 2.38 -3.55 -1.26 -2.42 0.15 -0.19 0.42 3.18 0.38 -1.78 0.63 -1.89 -0.85 -0.62 -0.41 -0.49 5.16 -0.32 0.08 -0.93 -1.86 -4.96 -0.11 0.64 -3.02 0.87 -0.14 -0.58 -0.75 0.82 0.26 -0.59 3.81 -0.56 1.96 (0.132) (0.574) 0.402 (0.836) (1.464) 0.949 (0.656) (0.112) (0.414) (0.197) (0.072) (0.238) 0.514 0.068 (0.244) 0.235 (0.289) 0.354 0.253 0.094 0.180 2.738 0.078 0.477 (0.066) (0.543) 0.816 0.087 (0.425) 0.257 0.143 0.041 0.160 0.154 0.513 0.185 (0.011) 1.289 (0.069) (3.356) 2.87 3.04 0.37 7.86 1.44 4.37 5.46 9.48 0.36 1.74 0.27 1.51 4.11 2.03 5.09 4.10 1.71 -0.16 1.89 0.93 3.13 -0.16 0.47 6.90 0.66 -0.02 1.64 1.24 2.36 3.67 1.84 0.93 -0.30 0.99 2.69 0.77 0.45 7.30 4.08 -7.96 115.29 164.41 72.97 164.96 218.20 184.38 157.60 260.92 141.83 143.53 50.20 144.23 128.55 61.00 204.12 105.08 98.32 82.90 128.59 58.97 288.98 360.98 27.85 224.12 37.30 46.38 233.83 37.59 130.41 200.99 33.60 24.79 16.03 43.58 52.80 52.78 22.57 297.38 119.62 291.25 113.02 162.16 71.77 157.60 214.70 180.22 152.13 255.44 139.26 141.80 49.34 142.94 123.75 58.83 199.06 101.06 96.91 80.44 125.93 57.81 284.10 349.68 27.20 221.16 36.92 45.53 230.00 36.07 128.46 197.29 31.82 23.86 15.77 42.18 49.94 51.58 21.86 288.95 116.87 279.60 104.08 157.39 68.01 152.25 210.44 162.38 143.95 229.25 134.77 137.15 47.89 139.22 109.39 56.60 186.83 96.67 89.23 75.30 119.36 56.05 267.07 299.35 26.31 200.40 34.87 41.01 213.86 34.06 121.19 179.97 28.99 23.06 14.91 40.83 43.25 47.58 20.36 255.07 108.14 289.31 117.52 165.96 71.72 162.83 222.74 172.75 159.71 251.20 143.69 141.70 49.68 142.87 119.84 58.63 202.01 100.73 99.74 78.68 124.81 57.78 280.98 324.76 27.34 213.83 38.17 49.57 228.60 36.51 127.25 195.19 31.14 24.29 16.09 43.09 47.56 50.36 22.79 273.61 116.24 304.55 130.95 174.53 75.44 173.40 235.04 183.12 175.46 273.15 152.61 146.26 51.47 146.53 130.29 60.65 217.18 104.79 110.26 82.07 130.26 59.50 294.89 350.16 28.37 227.27 41.48 58.13 243.34 38.95 133.32 210.40 33.28 25.53 17.26 45.36 51.88 53.14 25.23 292.14 124.34 319.79 45.81 48.08 48.95 53.81 42.51 65.22 48.10 59.24 38.58 56.21 50.18 55.70 63.72 57.04 54.03 58.62 48.53 54.75 54.79 51.16 58.08 69.63 48.58 61.63 41.88 34.54 50.63 54.97 59.57 53.37 64.13 52.38 39.56 47.98 67.39 59.88 44.98 61.37 55.96 43.97 111.97 162.58 70.60 160.19 217.91 171.82 153.52 243.12 140.14 140.11 49.08 141.62 123.24 58.32 195.96 100.44 95.09 77.86 123.32 57.40 275.86 323.34 27.17 209.79 36.70 45.39 222.92 36.04 125.54 189.33 31.82 24.11 15.71 42.42 49.16 49.88 21.98 276.55 113.53 303.90 119.16 164.65 71.99 158.66 222.54 170.68 161.48 251.18 144.91 140.82 49.56 141.91 116.67 57.77 201.49 99.65 100.20 79.60 124.39 58.32 279.77 320.67 27.74 212.23 38.43 50.27 235.75 36.36 127.14 197.17 30.20 24.29 16.51 43.29 47.22 49.58 23.21 269.31 115.71 298.83 120.52 164.94 74.89 154.51 220.21 168.84 162.56 252.37 146.46 139.63 49.73 140.77 115.28 57.76 201.27 99.53 101.16 81.61 127.03 58.95 278.93 315.18 28.31 211.96 39.23 50.14 240.40 36.36 122.73 200.32 29.58 24.69 17.84 45.32 48.33 50.01 23.66 270.43 116.22 290.71 26.27 20.08 19.66 27.65 14.66 30.84 21.85 27.47 21.83 23.83 21.74 22.64 28.85 25.90 27.53 31.58 22.10 31.78 25.40 21.24 25.91 43.15 29.10 30.53 17.83 19.45 25.36 26.75 25.07 28.41 32.97 26.59 23.73 24.28 31.00 26.95 19.66 30.12 25.89 18.34 -2.69 -0.33 -1.48 2.59 -0.28 1.43 -2.90 -1.15 -2.01 0.35 -0.12 0.66 2.67 0.31 -1.54 0.40 -1.60 -1.21 -0.87 -0.50 -0.67 2.42 -0.40 -0.40 -0.86 -1.32 -5.78 -0.20 1.07 -3.28 0.72 -0.18 -0.74 -0.90 0.30 0.08 -0.58 2.52 -0.49 5.32 SELL SELL SELL BUY SELL BUY SELL BUY SELL BUY SELL BUY BUY BUY BUY BUY SELL BUY BUY SELL BUY BUY BUY BUY SELL SELL SELL BUY BUY BUY BUY SELL SELL SELL BUY BUY SELL BUY BUY SELL SELL SELL BUY SELL SELL BUY SELL SELL SELL SELL SELL SELL BUY BUY SELL BUY SELL BUY BUY BUY BUY BUY BUY BUY SELL SELL BUY BUY SELL BUY BUY BUY BUY BUY BUY BUY SELL BUY SELL SELL INTERPRETATION OF TECHNICAL INDICATORS: Bollinger Bands: Variable width bands that narrow during less volatile periods and widen during more volatile periods. As a general rule, in a bearish trend, traders should buy when share price touches the lower band and exit when price touches the middle band. The reverse is true in a bullish trend, ie. buy when price touches the middle band and sell when price touches the upper band. Momentum traders tend to buy on price breakouts above the upper band, and sell when price breaks down below the lower band. 14-day Relative Strength Index (RSI): A reading below 30 is considered oversold, above 70 is overbought. A rise above 50 with a corresponding share price surge above the 30day moving average should be taken as a bullish move with good short-term upside potential. A fall below 50 and a simultaneous dip below the 30-day average is bearish and imply further near-term downside risk. Moving Averages: A stock’s short-term trend is bullish if share price stays above the 10-day moving average, and bearish if it stays below. The medium-term trend is positive if share price stays above the 30-day average, and negative if it remains below. A longer-term uptrend is intact if share price sustain above the 50-day average, and is deemed broken if it breaches below this level. Directional Movement Indicator (DMI): The DMI is an indicator of trend strength. A positive DMI difference (DMI diff) value is bullish and indicate a higher DI+ vs. DI-, while a negative DMI diff is bearish due to a lower DI+ vs. DI- (DMI diff = DI+ minus DI-). A crossover of DI+ above DI- triggers a BUY signal, while a SELL signal is flashed when the DI+ crosses below the DI-. The Average Directional Movement Index (ADX) indicates the strength of a trend, whether it is up or down. The higher the value of ADX, the stronger the trend. An ADX value above 25 suggests a trending market or stock, while a value below 20 signal congestion or absence of trend. Daily Moving Average Convergence Divergence (MACD): The MACD diff value is derived from the difference between the MACD line (the 12-day EMA minus the 26-day EMA) and the MACD signal line (the 9-day EMA of the MACD). A positive MACD diff value is bullish, while a negative MACD diff is bearish. A BUY signal is generated when the MACD diff rises above zero, and SELL signal sparked when the MACD diff value falls below zero. Page 3 of 5
105. 9-Nov-20 Fundamentals of Foreign Technical Picks Bloomberg Stock Name Ticker IBM UN MMM UN CVX UN CAT UN MCD UN HON US BA UN CRM US J NJ UN PG UN KO UN WMT UN TRV UN DD US GS US J PM UN AXP UN MRK UN DIS UN VZ UN HD UN UNH US T UN MS FT UW CS CO UW INTC UW AMGN US WBA US NKE US V US AIG US BAC US BP US C US LVS US MS US WFC US FB US AAPL US IBM 3M CHE VRON CATE RPILLAR MCDONALDS HONE YWE LL INT BOE ING S ALE S FROCE .COM J &J P&G COCA-COLA WAL-MART TRAVE LE RS DOWDUPONT GOLDMAN S ACHS J PMORGAN AME X ME RCK WALT DIS NE Y VE RIZON HOME DE P OT UTD HE ALTH AT&T MICROS OFT CIS CO INTE L AMGE N INC WALGRE E NS BOOTS NIKE INC VIS A INC AIG BANK OF AME RICA BP CITIGROUP LV S ANDS MS WE LLS FARGO FACE BOOK INC APPLE INC BABA US ALIBABA GRP Close Target Price % upside 2020 EPS ($) 2021 2020 PER(x) 2021 Div Yield(%) 2020 2021 52week Price High Low % Chg YTD 114.77 135.88 16% 9.12 11.69 12.6 9.8 5.7 5.9 158.72 90.60 -14.38 163.20 176.50 8% 72.14 94.96 24% 8.54 9.41 19.1 17.3 3.6 3.8 182.53 114.04 -7.49 -0.37 2.61 NA 27.6 7.1 7.3 122.94 51.62 -40.14 163.09 169.91 4% 5.40 6.87 30.2 23.7 2.5 2.7 171.26 87.50 10.43 216.31 238.81 9% 5.95 8.33 36.3 26.0 2.3 2.5 231.88 124.23 9.46 183.28 182.25 -1% 7.00 7.88 26.2 23.3 1.9 2.0 184.38 101.08 3.55 157.09 180.08 13% -8.89 1.60 NA 98.0 1.3 0.0 375.50 89.00 -51.78 260.22 275.16 5% 3.70 3.77 NA 69.0 0.0 0.0 284.50 115.29 60.00 139.76 165.47 16% 7.99 9.01 17.5 15.5 2.8 3.0 157.00 109.17 -4.19 142.38 149.86 5% 5.56 5.89 25.6 24.2 2.3 2.4 145.87 94.34 14.00 49.44 56.43 12% 1.89 2.11 26.2 23.5 3.4 3.4 60.13 36.27 -10.68 143.47 147.93 3% 5.40 5.65 26.6 25.4 1.5 1.6 151.08 102.00 20.73 127.51 128.56 1% 8.70 10.42 14.7 12.2 2.6 2.8 141.85 76.99 -6.89 60.19 68.82 13% 3.18 3.40 18.9 17.7 2.0 2.1 73.45 28.33 -6.25 202.96 255.12 20% 22.21 24.20 9.1 8.4 2.5 2.6 250.08 130.87 -11.73 104.35 116.19 10% 7.43 9.04 14.0 11.5 3.4 3.5 141.10 76.95 -25.14 98.11 109.11 10% 3.39 6.63 29.0 14.8 1.8 1.8 138.13 67.03 -21.19 80.46 96.42 17% 5.94 6.27 13.5 12.8 3.0 3.3 92.55 65.26 -11.53 126.96 136.75 7% 1.50 2.49 84.9 51.0 0.7 1.0 153.41 79.08 -12.22 58.15 62.23 7% 4.83 4.99 12.0 11.6 4.3 4.4 62.21 48.85 -5.29 285.85 299.60 5% 11.48 12.01 24.9 23.8 2.1 2.2 292.95 140.66 30.90 354.40 365.54 3% 16.69 18.35 21.2 19.3 1.3 1.4 360.98 187.72 20.55 27.51 31.23 12% 3.16 3.21 8.7 8.6 7.6 7.7 39.70 26.08 -29.61 223.29 242.02 8% 6.73 7.41 33.2 30.1 1.0 1.0 232.85 132.53 41.59 37.23 46.98 21% 3.09 3.30 12.0 11.3 3.9 4.1 50.27 32.41 -22.37 45.68 52.37 13% 4.87 4.54 9.4 10.1 2.9 3.0 69.28 43.62 -23.68 231.97 253.08 8% 16.15 17.02 14.4 13.6 2.8 2.9 264.97 177.05 -3.77 37.53 39.79 6% 4.73 5.11 7.9 7.3 5.1 5.3 63.24 33.36 -36.35 129.70 143.96 10% 2.90 3.69 44.8 35.1 0.8 0.9 131.38 60.00 28.02 197.64 220.68 10% 5.50 6.86 35.9 28.8 0.6 0.7 217.35 133.93 5.18 33.43 38.31 13% 2.27 4.35 14.7 7.7 3.9 4.0 56.42 16.07 -34.87 24.61 28.06 12% 1.74 2.08 14.2 11.8 2.9 3.1 35.72 17.95 -30.12 15.83 29.00 45% -1.71 1.76 NA 9.0 10.4 8.6 40.08 14.74 -58.06 43.07 61.50 30% 4.10 5.91 10.5 7.3 4.7 4.8 83.11 32.00 -46.09 52.60 57.85 9% -1.98 1.62 NA 32.5 1.7 4.4 74.29 33.30 -23.81 52.20 61.27 15% 5.70 5.15 9.2 10.1 2.7 2.8 57.57 27.20 2.11 22.33 28.90 23% 0.44 1.99 50.5 11.2 5.4 2.5 54.75 20.76 -58.49 294.68 319.84 8% 9.70 11.26 30.4 26.2 0.0 0.0 304.67 137.10 43.57 119.03 124.46 4% 3.95 4.26 30.2 27.9 0.9 0.9 137.98 53.15 62.14 287.75 334.61 14% 64.39 80.04 29.5 23.8 0.0 0.0 319.32 169.95 35.67 Note: The above data is based on Bloomberg consensus Page 4 of 5
106. 9-Nov-20 LIST OF RECOMMENDED BUY STOCKS FROM JUNE 2019 TO CURRENT Stock 3M CO 3M CO ALIBABA AIG AMERICAN EXPRESS AMGEN INC BANK OF AMERICA BANK OF AMERICA BP PLC BP PLC BP PLC BP PLC BP PLC CHEVRON CORP CHEVRON CORP CHEVRON CORP CITIGROUP CITIGROUP CISCO SYSTEMS COCA-COLA COCA-COLA COCA-COLA COCA-COLA DUPONT FACEBOOK FACEBOOK FACEBOOK FACEBOOK HOME DEPOT JOHNSON & JOHNSON JOHNSON & JOHNSON JP MORGAN JP MORGAN LAS VEGAS LAS VEGAS LAS VEGAS LAS VEGAS LAS VEGAS LAS VEGAS LAS VEGAS LAS VEGAS LAS VEGAS MCDONALDS MCDONALDS MCDONALDS MERCK & CO MERCK & CO MERCK & CO MERCK & CO MERCK & CO MERCK & CO MICROSOFT MICROSOFT MICROSOFT NIKE INC NIKE INC PFIZER INC PFIZER INC PFIZER INC PFIZER INC PFIZER INC PFIZER INC PFIZER INC PFIZER INC RAYTHEON TECH AT & T INC AT & T INC UNITEDHEALTH UNITEDHEALTH VISA INC VISA INC WALT DISNEY WALT DISNEY WALT DISNEY WALT DISNEY WALT DISNEY WALMART REC BUY Date Price 8/Oct/19 19/Feb/20 4/Nov/20 21/Oct/20 22/Jul/20 28/Oct/20 30/Sep/20 15/Oct/20 20/Aug/19 10/Dec/19 9/Jan/20 13/Feb/20 11/Mar/20 17/Oct/19 19/Nov/19 26/Aug/20 15/Jul/20 23/Sep/20 10/Sep/20 3/Mar/20 8/Apr/20 18/Jun/20 13/Oct/20 2/Oct/19 4/Jun/19 26/Mar/20 22/Apr/20 17/Sep/20 3/Dec/19 10/Oct/19 14/Oct/20 12/May/20 22/Sep/20 27/Aug/19 22/Oct/19 26/Feb/20 15/Apr/20 21/May/20 16/Jul/20 12/Aug/20 15/Sep/20 22/Oct/20 19/Sep/19 4/Dec/19 30/Jun/20 6/Feb/20 12/Mar/20 24/Mar/20 16/Jun/20 29/Sep/20 27/Oct/20 1/Oct/19 9/Jun/20 9/Sep/20 16/Jul/19 23/Jul/20 5/Sep/19 6/Sep/19 7/Sep/19 9/Apr/20 6/May/20 2/Jun/20 24/Jun/20 19/Aug/20 21/Apr/20 2/Jul/20 20/Oct/20 28/Aug/19 26/Sep/19 28/Feb/20 16/Apr/20 4/Mar/20 23/Apr/20 1/Jul/20 8/Oct/20 3/Nov/20 23/Jun/20 Total funds invested * Total unrealised profit Return 153.52 158.88 285.57 30.65 96.33 223.46 23.77 23.62 36.85 37.10 38.83 37.17 26.79 115.11 118.55 86.13 50.15 43.29 40.13 55.92 46.51 46.58 51.09 67.95 164.15 156.21 170.80 263.52 217.62 129.22 148.36 89.97 95.31 53.67 57.97 58.43 48.13 50.17 50.25 51.00 52.00 45.94 157.77 193.12 182.80 85.83 86.83 66.40 74.02 82.76 78.84 139.03 188.36 202.66 89.48 98.91 35.83 36.83 37.83 34.60 38.51 35.46 32.77 38.36 64.98 29.90 26.88 222.93 215.39 180.01 165.96 116.45 100.99 111.51 122.91 120.13 121.68 5-Nov-20 Price 163.20 163.20 287.75 33.43 98.11 231.97 24.61 24.61 15.83 15.83 15.83 15.83 15.83 72.14 72.14 72.14 43.07 43.07 37.23 49.44 49.44 49.44 49.44 60.19 294.68 294.68 294.68 294.68 285.85 139.76 139.76 104.35 104.35 52.60 52.60 52.60 52.60 52.60 52.60 52.60 52.60 52.60 216.31 216.31 216.31 80.46 80.46 80.46 80.46 80.46 80.46 223.29 223.29 223.29 129.70 129.70 36.39 36.39 36.39 36.39 36.39 36.39 36.39 36.39 58.28 27.51 27.51 354.40 354.40 197.64 197.64 126.96 126.96 126.96 126.96 126.96 143.47 Change (+/-) 9.68 4.32 2.18 2.78 1.78 8.51 0.84 0.99 (21.02) (21.27) (23.00) (21.34) (10.96) (42.97) (46.41) (13.99) (7.08) (0.22) (2.90) (6.48) 2.93 2.86 (1.65) (7.76) 130.53 138.47 123.88 31.16 68.23 10.54 (8.60) 14.38 9.04 (1.07) (5.37) (5.83) 4.47 2.43 2.35 1.60 0.60 6.66 58.54 23.19 33.51 (5.37) (6.37) 14.06 6.44 (2.30) 1.62 84.26 34.93 20.63 40.22 30.79 0.56 (0.44) (1.44) 1.79 (2.12) 0.93 3.62 (1.97) (6.70) (2.39) 0.63 131.47 139.01 17.63 31.68 10.51 25.97 15.45 4.05 6.83 21.79 pct ST 6.31 2.72 0.76 9.07 1.85 3.81 3.53 4.19 (57.04) (57.33) (59.23) (57.41) (40.91) (37.33) (39.15) (16.24) (14.12) (0.51) (7.23) (11.59) 6.30 6.14 (3.23) (11.42) 79.52 88.64 72.53 11.82 31.35 8.16 (5.80) 15.98 9.48 (1.99) (9.26) (9.98) 9.29 4.84 4.68 3.14 1.15 14.50 37.10 12.01 18.33 (6.26) (7.34) 21.17 8.70 (2.78) 2.05 60.61 18.54 10.18 44.95 31.13 1.56 (1.19) (3.81) 5.17 (5.51) 2.62 11.05 (5.14) (10.31) (7.99) 2.34 58.97 64.54 9.79 19.09 9.03 25.72 13.86 3.30 5.69 17.91 7,413,390 1,064,300 14.36% 179.36 179.36 306.97 36.25 102.56 242.74 26.81 26.81 18.59 18.59 18.59 18.59 18.59 78.76 78.76 78.76 46.12 46.12 42.28 54.50 54.50 54.50 54.50 62.83 304.67 304.67 304.67 304.67 287.60 145.71 145.71 110.22 110.22 53.79 53.79 53.79 53.79 53.79 53.79 53.79 53.79 53.79 240.50 240.50 240.50 87.37 87.37 87.37 87.37 87.37 87.37 236.70 236.70 236.70 133.81 133.81 40.61 40.61 40.61 40.61 40.61 40.61 40.61 40.61 60.87 32.32 32.32 366.21 366.21 214.17 214.17 135.81 135.81 135.81 135.81 135.81 151.33 Upside Targets MT LT 194.80 194.80 319.32 41.01 110.97 243.29 28.90 28.90 20.50 20.50 20.50 20.50 20.50 87.16 87.16 87.16 51.51 51.51 45.34 60.14 60.14 60.14 60.14 73.49 344.38 344.38 344.38 344.38 300.18 157.00 157.00 116.11 116.11 58.63 58.63 58.63 58.63 58.63 58.63 58.63 58.63 58.63 254.35 254.35 254.35 92.64 92.64 92.64 92.64 92.64 92.64 249.00 249.00 249.00 140.47 140.47 44.54 44.54 44.54 44.54 44.54 44.54 44.54 44.54 67.10 33.73 33.73 369.24 369.24 236.01 236.01 153.34 153.34 153.34 153.34 153.34 162.97 219.75 219.75 354.57 46.92 121.37 264.97 31.48 31.48 22.04 22.04 22.04 22.04 22.04 95.55 95.55 95.55 57.53 57.53 48.39 65.77 65.77 65.77 65.77 84.14 368.85 368.85 368.85 368.85 312.74 168.29 168.29 122.00 122.00 64.61 64.61 64.61 64.61 64.61 64.61 64.61 64.61 64.61 265.46 265.46 265.46 99.10 99.10 99.10 99.10 99.10 99.10 258.95 258.95 258.95 151.24 151.24 48.47 48.47 48.47 48.47 48.47 48.47 48.47 48.47 73.33 34.87 34.87 385.62 385.62 249.53 249.53 170.86 170.86 170.86 170.86 170.86 170.17 ST 9.90 9.90 6.68 8.44 4.54 4.64 8.94 8.94 17.44 17.44 17.44 17.44 17.44 9.18 9.18 9.18 7.08 7.08 13.56 10.23 10.23 10.23 10.23 4.39 3.39 3.39 3.39 3.39 0.61 4.26 4.26 5.63 5.63 2.26 2.26 2.26 2.26 2.26 2.26 2.26 2.26 2.26 11.18 11.18 11.18 8.59 8.59 8.59 8.59 8.59 8.59 6.01 6.01 6.01 3.17 3.17 11.60 11.60 11.60 11.60 11.60 11.60 11.60 11.60 4.44 17.48 17.48 3.33 3.33 8.36 8.36 6.97 6.97 6.97 6.97 6.97 5.48 % Upside MT 19.36 19.36 10.97 22.67 13.11 4.88 17.43 17.43 29.50 29.50 29.50 29.50 29.50 20.82 20.82 20.82 19.60 19.60 21.78 21.64 21.64 21.64 21.64 22.10 16.87 16.87 16.87 16.87 5.01 12.34 12.34 11.27 11.27 11.46 11.46 11.46 11.46 11.46 11.46 11.46 11.46 11.46 17.59 17.59 17.59 15.14 15.14 15.14 15.14 15.14 15.14 11.51 11.51 11.51 8.30 8.30 22.40 22.40 22.40 22.40 22.40 22.40 22.40 22.40 15.13 22.61 22.61 4.19 4.19 19.41 19.41 20.78 20.78 20.78 20.78 20.78 13.59 LT 34.65 34.65 23.22 40.35 23.71 14.23 27.92 27.92 39.23 39.23 39.23 39.23 39.23 32.45 32.45 32.45 33.57 33.57 29.98 33.03 33.03 33.03 33.03 39.79 25.17 25.17 25.17 25.17 9.41 20.41 20.41 16.91 16.91 22.83 22.83 22.83 22.83 22.83 22.83 22.83 22.83 22.83 22.72 22.72 22.72 23.17 23.17 23.17 23.17 23.17 23.17 15.97 15.97 15.97 16.61 16.61 33.20 33.20 33.20 33.20 33.20 33.20 33.20 33.20 25.82 26.75 26.75 8.81 8.81 26.25 26.25 34.58 34.58 34.58 34.58 34.58 18.61 Upside Targets ** ST = Short Term (one month) MT = Medium Term (three months) LT = Long Term (above six months) * The portfolio assumes each position consists of 1,000 shares and no deductions for any charges, fees and commision ** Upside Targets are derived from the subsequent Fibonacci Projection levels ** Apple Inc. stock split 4-1 effective 01/09/2020 The above table is a performance summary of our top BUY recommendations from June 2019 to current (sorted by name) together with upside targets, which are taken from subsequent Fibonacci Projection targets which could be achieved in one month (ST), three months (MT) and above six months (LT) from recommendation date. Interpretation: Investors should aim to take profit/sell trading positions when the percentage upside on the last three columns falls to 5% or below (shaded column). A negative percentage value indicates the upside target for the particular time-frame has been breached. Any revision in upside targets will be highlighted in bold. Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy and/ 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. As of Monday, November 09, 2020, the chartist, Stephen Soo, who prepared this report, has interest in the following securities covered in this report: (a) nil Kaladher Govindan – Head of Research TA SECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 2032 5048 www.ta.com.my Page 5 of 5