Consumer Sector

CSL

China Stationery Limited, an integrated plastic stationery China-based company is scheduled to be listed in Main Market on 24th February 2012.

The IPO consists of public issue of 90 million ordinary shares at an IPO price of RM0.90 per share with SGD0.001 par value. Out of this, 60 million shares are allocated to Malaysian public, and the remaining 30 million shares are allocated for private placement. On top of that, 133 million shares are for sale to selected investors.

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The global sell-off in equities has definitely raised the risk of an early recession. While it’s still early days yet to say that a bear market is taking hold, OSK feel that it is prudent to highlight a list of alternative defensive stocks for the longer run that would benefit in the event a recession does set in early.

These stocks will benefit from a drop in incomes and commodity prices and are generally more inward looking as OSK believe domestic incomes should be more resilient.

The tables below are OSK’s alternative stocks which contains, target price, rating & the reason for the selection.

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MSM

MSM Malaysia Holdings Berhad Initial Public Offering (IPO) received an overwhelming response with its public portion of 28.1 million shares. It was oversubscribed by 34.28 times. The IPO attract 50,496 applications or 496.1 million shares.

The institutional IPO prices was fixed at RM3.50 per share. Accordingly, the final retail price was fixed at RM3.38 per shares, represent 3 percent discount to the institutional price.

7.5 million shares were allocated for Bumiputera category while 7.5 million shares were allocated for Malaysian Public category. Below are the allotment summary for public portion.

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OSK still maintain year-end 1680-pt KLCI target. However, they note that there are increasing market volatility in the short term. Investors with a lower risk appetite and shorter investment horizon may want to focus on defensive and dividend yielding plays.

OSK  Top 10 Defensive Buys, which have dividend yields exceeding 4%, are from a broad range of sectors including Consumer, Healthcare, Media and Logistics.

OSK Top 10 Defensive Stocks Picks are,

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Consumer Products

The prices of food commodities have been on an uptrend due to a perceived tight supply. Amid concerns of how this will affect bottomlines, OSK believe that the share prices of food companies will lag in 2011.

OSK think that the near term negative impact on bottomlines is inevitable as companies adjust to higher raw material prices. On the other hand, OSK believe the retail industry will continue to deliver good earnings in 2011 driven by strong consumer spending and companies’ expansion plans.

OSK downgrade the F&B subsector to NEUTRAL, with CI Holdings and QL Resources as our top picks while we maintain OVERWEIGHT on the retail industry, with Parkson remaining our favorite stock.

Below are the target prices and ratings for selected consumer product stocks.

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