On Our Portfolio - I3investor · 5/25/2015 · On Our Portfolio 25 May 2015 PP7004/02/2013(031762)...
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On Our Portfolio 25 May 2015 PP7004/02/2013(031762) Page 1 of 8 On Our Portfolio The Going Gets Tough, the Tough Keep Buying By the Kenanga Research Team l [email protected] With the 11MP already unveiled and uninspiring 1QCY15 results report card so far where 73% of companies meeting expectations, it’s back to the drawing board for investors; what are the fresh catalysts that could prop the index to the next level? To recap, market sentiment was fairly bearish last week. First, we have the well-expected 11MP and then concerns of the possibility that the government may approach TENAGA to bail out 1MDB thumped the market lower. Having said that, we believe buying support will emerge at the current level (1,780/90) as investors start to nibble on weakness and this is also at our ideal “Buy-on-Weakness” level of 1,790. At such, we continue adhering to our “Buy-on-Weakness” strategy for this week with trading range of 1,780-1,821. On portfolio-performance-wise, despite weaker market sentiment, all our portfolios still managed to outpace the FBMKLCI by 65-297bps WoW and 622-1898bps YTD. Still buy on weakness. With 11MP failing to excite the market, players are searching for new catalysts. On the other hand, the two macro issues namely the weakensess in MYR and oil prices are not much an issue now as they have fairly stabilised. As such, the only focus for this week will be the results season which is now into the final leg. Key results to note are: MAYBANK (- 0.64%), TM (0.41%), GENTING (-1.69%) and AIRASIA (-9.65%). On the market, although general sentiment remains weak, buying support could emerge at current level of 1,780/90 as investors start to nibble on weakness. As such, we continue to adopt a “Buy-on-Weakness” strategy this week, which coud lead to a possible rebound play from here, with trading range of 1,780-1,821. A lacklustre week. Despite anticipating a technical rebound, the market went the opposite way last week. The strong start last Monday was mainly due to an 11 th hour buying of PETGAS (+1.28%) which sent the key index higher by 0.91%. However, subsequently news of another RAPID project being delayed dragged the barometer index lower mainly led by Petronas-linked counters, such as PCHEM (-1.26%), PETGAS and PETDAG (+0.30%). Market sentiment worsened last Thursday after PM unveiled the 11MP which failed to boost sentiment. In fact, construction big caps like GAMUDA (-2.88%) and MMCCORP (-1.54%), and small caps such as ULICORP (-3.50%), MITRA (+6.04%), GADANG (-3.13%) and HSL (+5.41%) all closed flat following the announcement of 11MP. At last Friday’s closing bell, the FBMKLCI closed 24.42pts or 1.35% lower to settle at 1,787.50. TENAGA (-2.42%) was the biggest loser last week followed by CIMB (-3.52%) and AXIATA (-3.40%). On Wall Street, US stocks generally had a good run in the first two trading days but drifted lower toward the end of the week as investors tried to digest the FOMC Meeting Minutes and sluggish economic data. In fact, the Dow consecutively closed on new record highs for two days when the market started last week, partly helped by some acquisition news in the pharmaceutical and apparel sectors. Small caps outshined in this bearish times. As usual, our well-balanced big and small caps exposure helped us to sail through last week’s lacklustre market with GROWTH Portfolio as top performer with 1.62% weekly gain followed by THEMATIC Portfolio (+1.49%). Even though DIVIDEND YIELD Portfolio posted a 0.70% weekly decline, it was still better than FBMKLCI’s -1.35%. The poorer income portfolio was basically due to the decline in TENAGA and DIGI (-3.15%). This is especially so for TENAGA which faced heavy selling pressure last Friday that saw its share price tanking by more than 4% following news report that it may be asked to bail out the problematic 1MDB. On the positive note, small caps like PESTECH (+4.73%) and CENTURY (+5.20%) helped to push up the other two portfolios. PESTECH rebounded after the announcement of USD60.6m EPC job for the Cambodian BOT project while the newly included CENTURY attracted buying interest following our Trading Buy call on the On Our Radar series last Monday. In all, on a YTD total returns basis, GROWTH Portfolio remained at top gainer with 22.15%, as opposed to the 30-stock index’s 3.17%, followed by THEMATIC (+10.07%) and DIVIDEND YEILD Portfolios (+9.39) Total Return (%) Key economic events to watch Date Consensus WoW YTD FBMKLCI -1.35 3.17 US Uni. of Michigan Sentiment – May F 29-May 90.0 Thematic 1.49 10.07 US GDP Annualized QoQ – 1Q S 29-May -0.9% Growth 1.62 22.15 China Manufacturing PMI – May 1-Jun 50.2 Dividend Yield -0.70 9.39 United Kingdom GDP QoQ – 1Q P 28-May 0.4%
Transcript of On Our Portfolio - I3investor · 5/25/2015 · On Our Portfolio 25 May 2015 PP7004/02/2013(031762)...
On Our Portfolio
25 May 2015
PP7004/02/2013(031762) Page 1 of 8
On Our Portfolio
The Going Gets Tough, the Tough Keep Buying By the Kenanga Research Team l [email protected] With the 11MP already unveiled and uninspiring 1QCY15 results report card so far where 73% of companies meeting expectations, it’s back to the dr awing board for investors; what are the fresh catalysts that could prop the index to the next lev el? To recap, market sentiment was fairly bearish last week. First, we have the well-expected 11MP an d then concerns of the possibility that the government may approach TENAGA to bail out 1MDB thu mped the market lower. Having said that, we believe buying support will emerge at the curren t level (1,780/90) as investors start to nibble on weakness and this is also at our ideal “Buy-on-Weak ness” level of 1,790. At such, we continue adhering to our “Buy-on-Weakness” strategy for this week with trading range of 1,780-1,821. On portfolio-performance-wise, despite weaker market s entiment, all our portfolios still managed to outpace the FBMKLCI by 65-297bps WoW and 622-1898bp s YTD.
Still buy on weakness. With 11MP failing to excite the market, players are searching for new catalysts. On the other hand, the two macro issues namely the weakensess in MYR and oil prices are not much an issue now as they have fairly stabilised. As such, the only focus for this week will be the results season which is now into the final leg. Key results to note are: MAYBANK (-0.64%), TM (0.41%), GENTING (-1.69%) and AIRASIA (-9.65%). On the market, although general sentiment remains weak, buying support could emerge at current level of 1,780/90 as investors start to nibble on weakness. As such, we continue to adopt a “Buy-on-Weakness” strategy this week,
which coud lead to a possible rebound play from here, with trading range of 1,780-1,821.
A lacklustre week. Despite anticipating a technical rebound, the market went the opposite way last week. The strong start last Monday was mainly due to an 11th hour buying of PETGAS (+1.28%) which sent the key index higher by 0.91%. However, subsequently news of another RAPID project being delayed dragged the barometer index lower mainly led by Petronas-linked counters, such as PCHEM (-1.26%), PETGAS and PETDAG (+0.30%). Market sentiment worsened last Thursday after PM unveiled the 11MP which failed to boost sentiment. In fact, construction big caps like GAMUDA (-2.88%) and MMCCORP (-1.54%), and small caps such as ULICORP (-3.50%), MITRA (+6.04%), GADANG (-3.13%) and HSL (+5.41%) all closed flat following the announcement of 11MP. At last Friday’s closing bell, the FBMKLCI closed 24.42pts or 1.35% lower to settle at 1,787.50. TENAGA (-2.42%) was the biggest loser last week followed by CIMB (-3.52%) and AXIATA (-3.40%). On Wall Street, US stocks generally had a good run in the first two trading days but drifted lower toward the end of the week as investors tried to digest the FOMC Meeting Minutes and sluggish economic data. In fact, the Dow consecutively closed on new record highs for two days when the market started last week, partly helped by some acquisition news in the pharmaceutical and apparel sectors.
Small caps outshined in this bearish times. As usual, our well-balanced big and small caps exposure helped us to sail through last week’s lacklustre market with GROWTH Portfolio as top performer with 1.62% weekly gain followed by THEMATIC Portfolio (+1.49%). Even though DIVIDEND YIELD Portfolio posted a 0.70% weekly decline, it was still better than FBMKLCI’s -1.35%. The poorer income portfolio was basically due to the decline in TENAGA and DIGI (-3.15%). This is especially so for TENAGA which faced heavy selling pressure last Friday that saw its share price tanking by more than 4% following news report that it may be asked to bail out the problematic 1MDB. On the positive note, small caps like PESTECH (+4.73%) and CENTURY (+5.20%) helped to push up the other two portfolios. PESTECH rebounded after the announcement of USD60.6m EPC job for the Cambodian BOT project while the newly included CENTURY attracted buying interest following our Trading Buy call on the On Our Radar series last Monday. In all, on a YTD total returns basis, GROWTH Portfolio remained at top gainer with 22.15%, as opposed to the 30-stock index’s 3.17%, followed by THEMATIC (+10.07%) and DIVIDEND YEILD Portfolios (+9.39)
Total Return (%) Key economic events to watch Date Consensus WoW YTD
FBMKLCI -1.35 3.17 US Uni. of Michigan Sentiment – May F 29-May 90.0 Thematic 1.49 10.07 US GDP Annualized QoQ – 1Q S 29-May -0.9% Growth 1.62 22.15 China Manufacturing PMI – May 1-Jun 50.2 Dividend Yield -0.70 9.39 United Kingdom GDP QoQ – 1Q P 28-May 0.4%
On Our Portfolio 25 May 2015
PP7004/02/2013(031762) Page 2 of 8
Weekly Charting – FBM KLCI index
Source: Kenanga Research
Another quite week. The FBMKLCI’s uptrend has been broken mainly due to the general sell-down last Thursday. In tandem with the on-going concerns over mixed data reported regionally, the highly anticipated 11th Malaysian Plan also failed to inspire confidence on the market. Trading volume and value were much lower WoW, suggesting investors are cautious to venture into the market. Indicator-wise, Stochastic has entered into oversold territory while RSI remained tepid to showcase the lacklustre trading week. Despite the bearish tone, we still reckon that the support zone of 1,780 is a prime level for investors to nibble on weakness. Thus we continue to adopt a ‘Buy-on-Weakness’ strategy for this week.
Technical Ratings
Resistance 2 1821 MACD Neutral
Resistance 1 1800 Stochastic Oversold
Current Level 1787.50 RSI Neutral
Support 1 1780
Support 2 1841 Outlook Neutral
Figure 1 - Crude Oil Price volatility Chart
Source: Kenanga Research
Figure 2 – USDMYR weekly chart
Source: Kenanga Research
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On Our Portfolio 25 May 2015
PP7004/02/2013(031762) Page 3 of 8
Retail Model Portfolio – THEMATIC
No CATS Code Industry / Company
Last Buy/Sell
Date
No. of Shares
Average Cost
Avg Cost/ Share
Share Price
@ 22
May 15
Value Unrealised Profit / (Loss)
% Change YTD
Weighting (as % of
NAV)
Latest Dividend Ex-Date
Gross Div
Consensus 12M Div
Yield
KNK’s/ Consensus’
TP
Potential Upside/
Downside
RM RM RM RM RM % % RM % RM % 1 5347 TENAGA NASIONAL BHD 2-Jan-15 1,000 13,800 13.800 13.70 13,700 (100) -0.72% 13.8% 5/18/2015 0.10 2.12 14.32 4.5%
2 5168 HARTALEGA HOLDINGS BHD 2-Jan-15 2,500 17,500 7.000 8.190 20,475 2,975 17.00% 17.5% 5/19/2015 0.03 1.59 8.20 0.1%
3 5219 PESTECH INTERNATIONAL BHD 2-Jan-15 3,500 12,250 3.500 5.090 17,815 5,565 45.43% 12.3% 4/14/2015 0.04 1.96 6.11 20.0%
4 0032 REDTONE INTERNATIONAL BHD 30-Jan-15 30,000 22,200 0.740 0.800 24,000 1,800 8.11% 22.2% 1/22/2015 0.01 1.37 0.80 0.0%
5 7174 CAB CAKARAN CORP BHD 2-Mar-15 5,000 4,650 0.930 1.130 5,650 1,000 21.51% 4.7% 3/24/2006 0.01 0.00 1.29 14.2%
6 7117 CENTURY LOGISTICS HOLDINGS B 15-May-15 5,000 4,325 0.865 0.910 4,550 225 5.20% 4.3% 6/1/2015 0.01 0.00 1.19 30.8%
74,725 86,190 11,465 15.34% 74.7% 0.84
Total Dividend Received YTD 450
Total Realised Return -1,845
Total Return (based on the total allocated amount ) 10,070 10.07%
KLCI FBMKLCI Index 1,752.77 1,787.50 34.73 1.98% 3.16
KLCI – TOTAL RETURN 3.17%
Total Realised Return No. CATS Code Industry / Company Last Buy/Sell Date No of Shares Cost @ Avg Cost/Share Share Price @ Value Realised % Change
RM RM RM RM RM % 1 1023 CIMB GROUP HOLDINGS BHD 13-Jan-15 2,000 11,840 5.92 5.50 11,000 -840 -7.09% 2 5115 ALAM MARITIM RESOURCES BHD 3-Mar-15 15,000 11,850 0.79 0.725 10,875 -975 -8.23% 3 5218 SAPURAKENCANA PETROLEUM BHD 13-Mar-15 3,000 7,050 2.35 2.340 7,020 -30 -0.43% -1,845
Total Dividends Received No CATS Code Company No. of Shares Ex-Date Gross Div Div Rec 1 5218 SAPURAKENCANA PETROLEUM BHD 3,000 1/12/2015 0.02 60.00
2 5168 HARTALEGA HOLDINGS BHD 2,500 3-Mar-15 0.03 75.00
3 5219 PESTECH INTERNATIONAL BHD 3,500 14-Apr-15 0.04 140.00
4 5347 TENAGA NASIONAL BHD 1,000 18/5/2015 0.10 100.00
5 5168 HARTALEGA HOLDINGS BHD 2,500 19/5/2015 0.03 75.00
TOTAL DIVIDEND RECEIVED 450.00
On Our Portfolio 25 May 2015
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Retail Model Portfolio - GROWTH
No CATS Code Company
Last Buy/Sell
Date
No. of Shares
Average Cost
Avg Cost/ Share
Share Price
@ 22 May
15
Value Unrealised
Profit / (Loss)
% Change
YTD
Weighting (as % of
NAV)
Latest Dividend Ex-Date
Gross Div
Consensus 12M Div
Yield
KNK’s/ Consensus’
TP
Potential Upside/
Downside
RM RM RM RM RM % % RM % RM %
1 5347 TENAGA NASIONAL BHD 2-Jan-15 1,000 13,800 13.800 13.70 13,700 (100) -0.72% 13.80% 5/18/2015 0.10 2.12 14.32 4.5%
2 5219 PESTECH INTERNATIONAL BHD 2-Jan-15 5,000 17,500 3.500 5.090 25,450 7,950 45.43% 17.50% 4/14/2015 0.04 0.00 6.11 20.0%
3 0032 REDTONE INTERNATIONAL BHD 30-Jan-15 30,000 22,200 0.740 0.800 24,000 1,800 8.11% 22.20% 1/22/2015 0.01 1.37 0.80 0.0%
4 7174 CAB CAKARAN CORP BHD 2-Mar-15 10,000 9,300 0.930 1.130 11,300 2,000 21.51% 9.30% 3/24/2006 0.01 0.00 1.29 14.2%
5 7117 CENTURY LOGISTICS HOLDINGS B 15/5/2015 5,000 4,325 0.865 0.910 4,550 225 5.20% 4.33% 6/1/2015 0.01 0.00 1.19 30.8%
67,125 79,000 11,875 17.69% 67.13% 0.60
Total Dividend Received YTD 780
Total Realised Return 9,490
Total Return (based on the total allocated amount ) 22,145 22.15%
KLCI FBMKLCI Index 1,752.77 1,787.50 34.73 1.98% 3.16
KLCI – TOTAL RETURN 3.17%
Total Realised Return No. CATS Code Industry / Company Last Buy/Sell Date No of Shares Cost @ Avg Cost/Share Share Price @ Value Realised % Change
RM RM RM RM RM % 1 5218 SAPURAKENCANA PETROLEUM BHD 13-Mar-15 3,000 7,050 2.35 2.340 7,020 -30 -0.43%
2 7081 PHARMANIAGA BERHAD 22-Apr-15 3,500 16,030 4.58 7.300 25,550 9,520 59.39% 9,490
Total Dividends Received No CATS Code Company No. of Shares Ex-Date Gross Div Div Rec 1 5218 SAPURAKENCANA PETROLEUM BHD 3,000 12-Jan-15 0.02 60.00
2 7081 PHARMANIAGA BERHAD 3,500 9-Mar-15 0.12 420.00
3 5219 PESTECH INTERNATIONAL BHD 5,000 14-Apr-15 0.04 200.00
4 5347 TENAGA NASIONAL BHD 1,000 18-May-15 0.10 100.00
TOTAL DIVIDEND RECEIVED 780.00
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Retail Model Portfolio – DIVIDEND YIELD
No CATS Code Industry / Company
Last Buy/Sell
Date
No. of Shares
Average Cost
Avg Cost/ Share
Share Price
@ 22
May 15
Value Unrealised Profit / (Loss)
% Change
YTD
Weighting (as % of
NAV)
Latest Dividend Ex-Date
Gross Div
Consensus 12M Div
Yield
KNK’s/ Consensus’
TP
Potential Upside/
Downside
RM RM RM RM RM % % RM % RM % 1 1562 BERJAYA SPORTS TOTO BHD 2-Jan-15 5,000 17,700 3.540 3.27 16,350 (1,350) -7.63% 17.7% 4/6/2015 0.05 7.19 4.25 30.0%
2 5347 TENAGA NASIONAL BHD 2-Jan-15 1,000 13,800 13.800 13.70 13,700 (100) -0.72% 13.8% 5/18/2015 0.10 2.12 14.32 4.5%
3 0032 REDTONE INTERNATIONAL BHD 30-Jan-15 30,000 22,200 0.740 0.800 24,000 1,800 8.11% 22.2% 1/22/2015 0.01 1.37 0.80 0.0%
4 6947 DIGI.COM BHD 11-May-15 3,000 18,090 6.030 5.840 17,520 (570) -3.15% 18.1% 5/13/2015 0.06 4.43 6.87 17.6%
5 7117 CENTURY LOGISTICS HOLDINGS B 15-May-15 5,000 4,325 0.865 0.910 4,550 225 5.20% 4.3% 6/1/2015 0.01 5.13 1.19 30.8%
76,115 76,120 5 0.01% 76.1% 1.87
Total Dividend Received YTD 1,253
Total Realised Return 8,130
Total Return (based on the total allocated amount ) 9,388 9.39%
KLCI FBMKLCI Index 1,752.77 1,787.50 34.73 1.98% 3.16
KLCI – TOTAL RETURN 3.17
Total Realised Return No. CATS Code Industry / Company Last Buy/Sell Date No of Shares Cost @ Avg Cost/Share Share Price @ Value Realised % Change
RM RM RM RM RM % 1 5218 SAPURAKENCANA PETROLEUM BHD 13-Mar-15 3,000 7,050 2.35 2.340 7,020 -30 -0.43% 2 7081 PHARMANIAGA BERHAD 22-Apr-15 3,000 13,740 4.58 7.30 21,900 8,160 59.39% 8,130
Total Dividends Received No CATS Code Company No. of Shares Ex-Date Gross Div Div Rec 1 5218 SAPURAKENCANA PETROLEUM BHD 3,000 1/12/2015 0.02 60.00
2 1562 BERJAYA SPORTS TOTO BHD 5,000 28-Jan-15 0.06 300.00
3 7081 PHARMANIAGA BERHAD 3,000 9-Mar-15 0.12 360.00
4 1562 BERJAYA SPORTS TOTO BHD 5,000 6-Apr-15 0.05 250.00
5 6947 DIGI.COM BHD 3,000 13-May-15 0.06 183.00
6 5347 TENAGA NASIONAL BHD 1,000 18-May-15 0.10 100.00
TOTAL DIVIDEND RECEIVED 1,253.00
On Our Portfolio 25 May 2015
PP7004/02/2013(031762) Page 6 of 8
Portfolios Total Return 2013 (based on the total al located amount) vs FBMKLCI Performance
Source: Bloomberg, Kenanga Research Portfolios Total Return 2014 (based on the total al located amount) vs FBMKLCI Performance
Source: Bloomberg, Kenanga Research Portfolios Total Return 2015 (based on the total al located amount) vs FBMKLCI Performance
Source: Bloomberg, Kenanga Research
On Our Portfolio 25 May 2015
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Daily Charting: FBMKLCI Weekly Charting: FBMKLCI
Daily Charting: FBM70 Weekly Charting: FBM70
Daily Charting: FBMSC Weekly Charting: FBMSC
Daily Charting: DJIA Weekly Charting: DJIA
Source: Bloomberg
On Our Portfolio 25 May 2015
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Stock Ratings are defined as follows: Stock Recommendations OUTPERFORM : A particular stock’s Expected Total Return is MORE than 10% (an approximation to the 5-year annualised Total Return of FBMKLCI of 10.2%). MARKET PERFORM : A particular stock’s Expected Total Return is WITHIN the range of 3% to 10%. UNDERPERFORM : A particular stock’s Expected Total Return is LESS than 3% (an approximation to the 12-month Fixed Deposit Rate of 3.15% as a proxy to Risk-Free Rate). Sector Recommendations*** OVERWEIGHT : A particular sector’s Expected Total Return is MORE than 10% (an approximation to the 5-year annualised Total Return of FBMKLCI of 10.2%). NEUTRAL : A particular sector’s Expected Total Return is WITHIN the range of 3% to 10%. UNDERWEIGHT : A particular sector’s Expected Total Return is LESS than 3% (an approximation to the
12-month Fixed Deposit Rate of 3.15% as a proxy to Risk-Free Rate). ***Sector recommendations are defined based on market capitalisation weighted average expected total return for stocks under our coverage.
This document has been prepared for general circulation based on information obtained from sources believed to be reliable but we do not make any representations as to its accuracy or completeness. Any recommendation contained in this document does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may read this document. This document is for the information of addressees only and is not to be taken in substitution for the exercise of judgement by addressees. Kenanga Investment Bank Berhad accepts no liability whatsoever for any direct or consequential loss arising from any use of this document or any solicitations of an offer to buy or sell any securities. Kenanga Investment Bank Berhad and its associates, their directors, and/or employees may have positions in, and may effect transactions in securities mentioned herein from time to time in the open market or otherwise, and may receive brokerage fees or act as principal or agent in dealings with respect to these companies.
Published and printed by: KENANGA INVESTMENT BANK BERHAD (15678-H) 8th Floor, Kenanga International, Jalan Sultan Ismail, 50250 Kuala Lumpur, Malaysia Chan Ken Yew Telephone: (603) 2166 6822 Facsimile: (603) 2166 6823 Website: www.kenanga.com.my Head of Research
