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,
Japan hits by worst earthquake in over 100 years. The cost of reconstruction is estimated at USD161bn. The impact on Malaysia is generally limited given that Japan’s major ports and industrial areas have been spared. However, there would still be winners and losers among some sectors. For now, OSK maintain Buy into Weakness call on the Malaysian market with year-end target for KLCI of 1680 pts remain intact.
Despite relatively strong results from a number of Blue Chips in February, the market still retreated and ended up in the red so far in 2011. Selling was largely attributed to concerns arising from political unrest in the Middle East but the risk is limited if this does not spread to Saudi Arabia.
With the 4Q2010 earnings results season over, OSK unveil new 2011 KLCI year-end target of 1680 pts, which is the average of the 2011 KLCI fair value (1648 pts) and that for 2012 of 1710 pts.
OSK continue to advocate Buying into Weakness for sectors such as Banking and to trade in O&G, Construction and Property plays. OSK also adding a slightly defensive flavor to our Top Buys for March. While the market remains volatile for now, OSK see an election driven rally towards year-end.
The table below are the target price for March 2011 top picks.
In 2010, there is 29 new Initial Public Offering (IPO) compare to 14 in 2009. Out of 29 listings, 23 companies were listed on the Main Board of Bursa Malaysia, while the rest were on the ACE Market.
How do they performed?
Based on data compiled from Bursa Malaysia, 17 out of 29 stocks closed higher than their offer price on the listing date. However, on 30th December 2010, the last trading day, only 12 closed higher than offer price. Seem like IPO stocks performance in 2010 is not very encouraging.
In January 2011, 3 more IPOs will be listed in Bursa Malaysia. They are K. Seng Seng Corporation, Benalec Holdings and Tambun Indah Land. With 2010 IPO performance data, are you going to subscribe to 2011 IPO?
The table below are the summary of 2010 IPO performance.
It was speculated earlier that Petronas Carigali to listed in Bursa Malaysia when Prime Minister announced to reduce state ownership in the private sector early this year. However, it did not materialize after Petroliam Nasional Bhd (Petronas) listed Malaysia Marine and Heavy Engineering Holdings Bhd (MHE) and Petronas Chemicals Groups (PCG).
Now, the speculation come to surface again as a few of stock research companies such as MIDF Research and OSK Research release reports of possible IPO for Petronas Carigali.
Petronas Carigali Sdn Bhd is the exploration unit of Petronas, may be listed on Bursa Malaysia in 2011 and it is expected to attract a large number of foreign funds.