June TIV continued to fall although OSK had earlier anticipated it to have hit bottom in May, largely due to amendments to the HP Act. TIV for June dived 22.6% y-o-y, 12.4% q-o-q and 9.2% m-o-m, dragging the cumulative numbers into negative territory for the first time this year, for a 1.3% contraction YTD.
OSK expect to see poor earnings q-o-q and y-o-y across the board, notably for UMW, Tan Chong and MBM Resources as margins would be pressured by plant underutilization. OSK reiterate our NEUTRAL stance on the AUTOMOTIVE sector.
Below are the target price/fair value and rating for selected stocks in automotive sector.
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Do you know that Employee EPF contribution rate was changed 10 times since EPF was established in 1952? During the same period, Employer EPF contribution rate changed 3 times. The rate was calculated base on gross salary of the employee.
The changed was done due to various reason. For example in 2009, employee contribution rate reduced to 9 from 11 percent. The aim was to stimulate Malaysian economy due to recession by encouraging public to spend more. However, public can opt not to change it.
The table below is the historical Employees & Employers EPF Contribution Rate since 1952.
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Prestariang Berhad Initial Public Offering (IPO) received an overwhelming response with its public portion of 30 million shares. It was oversubscribed by 7.10 times. The IPO attract 13,355 applications or 243.1 million shares.
In addition, 40 million shares made available for private placement to identified investors have been placed out.
The IPO allocate 30 million shares for public. Of these, 15 million shares were allocated for Bumiputera category while 15 million shares were allocated for Malaysian Public category.
Below are the allotment summary for public portion.
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Program Perumahan 1Malaysia or 1Malaysia Housing Programme (PR1MA), was launched on 4th July 2011. The programme aim to assist the middle income group buying a property.
In the first phase of the programme, more than 43,000 houses will be build on 20 strategic sites in Klang Valley, Rawang and Seremban. The development will taking more than 2,000 acre in land area. The project will start in between quarter 3 (Q3) 2011 and 2018.
The table below is the details on location, developer, land size, number of houses and development target of PR1MA phase 1.
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With M&As in the Malaysian steel sector reaching a feverish pitch and a few parcels of iron ore mining concessions potentially coming up for grabs soon, OSK is warming up to this sector, which has long been left out in the cold.
OSK has Trading BUY calls on Lion Industries, Ann Joo and Perwaja, and also upgrade Kinsteel to a NEUTRAL as these 4 companies are potential winners from these fresh theme plays. However, OSK maintain our NEUTRAL rating on Southern Steel and Malaysia Steel Works (Masteel).
Below are the target price/fair value and rating for selected stocks in steel sector.
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