In March 2011, Sunway Holdings was awarded two contracts worth RM332 million. The contracts are RM74.1 million construction of central utilities facility at Biotechnological Park BioXCell and RM258m job for the construction of the Legoland Theme Park. Both contracts are located in Iskandar, Johor.
Another interesting news is regarding the merger between Sunway Holdings and Sunway City. The EGM to vote on the merger is expected to be held sometime in April. If the proposal goes through, the merged entity should be listed in July or August 2011.
Many research houses are calling “buy” for Sunway Holdings. The table below are the target price for Sunway from various research house. The last traded price was RM2.19.
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February 21, 2011
Stock Picks
Alam Maritim,
Coastal,
Construction Sector,
Consumer Sector,
Evergreen,
Freight,
Glomac,
KPJ,
Oil & Gas Sector,
Pelikan,
Property Sector,
Salcon,
Signature,
Sunway
2010 proved to be a decent year for OSK’s Small Cap Jewels although their performance was eclipsed by the liquidity-infused rally, which benefited the bigger caps, particularly from 2H2010.
Of the 50 stocks profiled in handbook, half posted absolute returns in excess of 20%, with 49% outperforming the FBM Small Cap and FBM KLCI indices.
While the smaller caps are expected to bask in the glory their larger cap peers in 2011, investors should not ignore names with good longer term potential that are trading at attractive valuations.
OSK like small caps in the construction, property, oil & gas and consumer sectors as beneficiaries of the ETP, elections and earnings themes.
The table below are the 2010 performance of OSK Top 50 Small Jewels and performance since OSK’s Small Cap Jewels report released in April 2010.
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Maintain OVERWEIGHT. We believe that our RM18bn domestic jobs win target for 2011 could likely be breached should the various projects under the ETP kick off faster than expected. Given the likelihood of an early General Election this year, we expect the momentum of news flow within the sector to accelerate.
Our top sector pick is Gamuda for its MRT exposure, with its Vietnam property launches and resolution of the water assets consolidation as the wild card. For the small caps, we like Ahmad Zaki. In view of the state elections which must be held by May, we continue to like the Sarawak theme and highlight sector laggard Naim Holdings. Investors may also consider looking at Iskandar construction plays, with Kim Lun as key proxy.
Below are the target price for selected stocks in construction sector.
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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.
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Continue to see the market rallying on 3 Factors. After rising more than 20% at its highest in 2010, we still see the Malaysian market rallying to new highs in 2011 with our KLCI fair value at 1648 points.
We believe this rally will be driven by 3 key factors:
- Still respectable Earnings at 16% growth for 2011 with most sectors expected to record at least 10% growth. Banks and Domestic consumption driven sectors such as Aviation, Healthcare and Property should see decent quality earnings with little downside surprises. We expect earnings surprises and upgrades to support the market in 2011.
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