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2021-10-20 05:57:31 ALUMINIUM - The beginning of a lengthy bull-cycle?

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2021-10-20 03:35:48 Technical tracker - HLIB Retail Research – 20 October 2021

TAKAFUL (RM4.00-BUY-Rated) – It’s a Bargain now

Listed since 1996, Syarikat Takaful Malaysia Keluarga Berhad (TAKAFUL) has been one of the leading Takaful operators in Malaysia. It runs both the family and general takaful business along with a small overseas operation in Indonesia.

After sliding 21% from a high of RM5.08 (8 Mar) to RM 4.00 on 18 Oct, TAKAFUL is currently trading at an undemanding 8.8x FY22 P/E (34% and 18% discount against its 5-years average of 13.5x and peers’ average of 10.7x, respectively), underpinned by a steady 4.3% FY21-23 EPS CAGR and 3%-5.6% FY21-22 DYs. TAKAFUL’s stock performance had been lackluster, possibly because of fund’s portfolio rebalancing activities due to BIMB’s corporate exercise. We believe the stock price is likely to catch up when the portfolio rebalancing activities subside. Hence, recent weakness in share prices provides a great opportunity to accumulate given TAKAFUL long-term prospects remained intact.

While we expect 3QFY21 earnings to be weaker due to lower gross earned contribution amid recent lockdown, we nonetheless reckon the group’s online sales portal (OSP) that had gained traction since 1H21 would serve as a cushion to limit the impact. We expect the overall business to pick up again in 4QFY21 (similar trend to 2020’s movement restrictions) as economic reopening gains traction. Going forward, the group will continue with its strategic initiatives to strengthen its business resilience and adjust its operating models to cater into a very different market and dynamic operating landscape.

Technically, TAKAFUL is grossly oversold and building a sound base at RM 3.95-4.05 territory. Any weakness from the current price toward key supports of RM3.95 provides a good opportunity to accumulate. A strong breakout above RM 4.22 (0.236 FR) will spur the price higher to RM 4.40-4.52 territory. Cut lost at RM3.87.

Collection range: RM3.90-3.95-4.02

Upside targets: RM4.35-4.40-4.52

Cut: RM3.87

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2021-10-18 11:43:21 Bullish Tracker Results for October 1-13

We’ve achieved another % successful hit rate and 6.36% return !

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2021-10-18 07:47:38 Wishing all our Muslim clients, Salam Maulidur Rasul! May this blessed day bring peace and joy to you and your loved ones  . Open / Comment

2021-10-18 03:55:27 HLIB Retail Research – 18 Oct - Bullish Tracker:

FRONTKN (3.69), Main market , Semiconductors

Beneficiaries of better than expected TSMC results; Uptrend remain intact; Indicators showing uptick bias

Time frame: 7 days
Entry: RM3.63-3.69
Stop Loss: RM3.59
Resistance:RM3.80-3.87-3.93
Target price: RM3.87-3.90
Risk profile: Low

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2021-10-18 03:42:18 Technical tracker - HLIB Retail Research – 18 October 2021

EVERGRN (RM0.415-Non-Rated) – Anticipate swift recovery in 4Q21

EVERGRN’s MDF segment is expected to gain traction as the group continues to enjoy brisk demand with ASP increasing by 20% YoY in 2Q21, thanks to the supply surplus situation that had gradually improved as well as the increasing demand from the Middle East. As EVERGRN restarted its Malaysia operation (early September) together with encouraging demand for its products from the export markets, we opine the worst may be over for EVERGRN after factoring a sluggish 3Q21 results (as 2-2.5 months of the Malaysia operation was closed).

At RM0.415, EVERGN is trading at an undemanding 0.34x P/B (51% discount to its peers and 17% discount to its 5Y P/B of 0.41x) in anticipation of a strong comeback starting from 4Q21, underpinned by a robust FY21-23 EPS CAGR of 75%. We note that the macro environment has turned favourable for EVERGRN, especially the promising furniture outlook to the US market, rising MDF export demand and ASP as well as the current USD strength. Furthermore, its successful cost rationalization and additional capacity in Thailand provides further upside for its Thailand segment.

Technically, EVERGRN is poised for a long-term downtrend line breakout as technical indicators are on the mend. A successful breakout above 0.43 (downtrend resistance) would signal a new upleg toward RM0.46-0.50 levels. Current prices at RM0.39-0.42 levels provide a good opportunity for investors to accumulate, given HLIB Research TP RM0.67.

*Collection range: RM0.39-0.40-0.42*

*Upside targets: RM0.44-0.46-0.50*

*Cut: RM0.38*

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EVERGRN (RM0.415-Non Rated) – 预计在 21 年第 4 季度实现复苏

EVERGRN 的 MDF 部门预计将保持强劲，得益于旺盛的需求加上更高得平均售价（2021 年第二季度同比增长 20%）因为供应过剩情况逐渐改善以及中东需求增加。在 EVERGRN 9月初重启其马来西亚业务加上市场对其产品的需求大增等因素下，在考虑21 年第三季度业绩将疲软（马来西亚业务关闭 2-2.5 个月）后，EVERGRN 最糟糕的情况可能已经过去.

EVRGREEN 目前处于RM 0.415 的价格，交易在 0.34 倍的市净率（比同行以及5年平均值低于51%和17%。EVRGRN 预计在 21 年第四季度开始强劲复苏，21-23 年每股收益复合年增长率将达到 75%。我们注意到宏观环境也对 EVERGRN 有利，尤其是美国市场的家具前景看好、MDF 的出口需求与ASP的上升以及目前美元持续走强。此外，其在泰国的成本合理化的成功与扩展的产能也将为其泰国的业务提供进一步的增长空间。

从技术上讲，随着技术指标的转佳，EVERGRN 有望突破长期下降趋势线。股价若成功突破 RM0.43（下降趋势阻力）将标有望上涨至 RM0.46-0.50 的水平。鉴于 HLIB Research 目标价 RM0.67，当前的价格区域 RM0.39-0.42为投资者提供了一个很好的积累机会。

买入范围：RM0.39-0.40-0.42

上行目标：RM0.44-0.46-0.50

止损：RM0.38


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2021-10-15 03:48:40 Technical tracker - HLIB Retail Research – 15 October 2021

KRONO (RM0.635-Non-Rated) – Riding on the digitalized era

Listed in Dec 2013, Kronologi Asia Berhad (KRONO) provides on-site and off-site enterprise data management (EDM) and data storage solutions to Asia Pacific businesses. It offers customers backup, storage, and recovery services for digital data to ensure business continuity for its clients. Currently, KRONO derives its profit through exporting to countries such as Singapore (36.6% of FY20 revenue), Philippines (35.4% of FY20 revenue), China (6.2% of FY20 revenue), etc.

The demand for data backup is expected to stay buoyant driven by the inevitable surge in the use of the internet usage due to the Covid-19 pandemic. On top of that, the adoption of advanced technologies such as IoT and Machines learning had boded well to the EDM markets with an expectation of 12.1% CAGR growth rate in the Asia Pacific market. As a result, we view KRONO's recent full acquisition of its China associate company positively as it will strengthen its vast untapped market share in China.

After sliding from a high of RM0.945 (22 Feb) to a low of RM0.58 (21 May) before closing at RM0.635 yesterday, KRONO is currently trading at an undemanding 1.22x trailing P/B (32% discount against its 5-years average of 1.8x). Going forward, the management expects KRONO’s prospect to remain promising as customers find increasing value in As-A-Service and Data Management hybrid solutions, with penetration in new markets.

To recap, KRONO had implemented multiple tranches of private placements ranging from RM0.63-0.66 since May 2021. Hence, downside risk is likely to be well-cushioned. Technically, KRONO is poised for a LT downtrend line breakout soon with indicators showing uptick bias. A successful breakout above RM0.65 (downtrend resistance) would signal a new uptrend leg had begun and may spur the prices towards its RM0.68-0.70-75 levels. Cut lost at RM 0.59.

Collection range: RM0.61-0.63-0.64

Upside targets:
RM0.68-0.70-0.75

Cut: RM0.59

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2021-10-14 03:23:11 Technical tracker - HLIB Retail Research – 14 Oct 2021

HSSEB (RM0.575-Not rated) – Good prospects for orderbook expansion; Pending a rounding bottom formation

The largest local EPMS company. HSSEB (listed in Apr 2016) is principally involved in the provision of engineering and project management services (EPMS) to a wide array of projects including 1) railway & transit; 2) highway & transportation; 3) building & township; 4) port; 5) property; and 6) power & water. The Group has been involved in many notable large-scale projects including MRT 1 & 2, Maju Expressway 2, West Coast Expressway, SUKE Expressway, Pahang–Selangor Water Raw Transfer, Sarawak Water Grid Study, and East Coast Rail Link ETC. These are a testament to its EPMS capabilities and will position the group favourably to secure more projects in the government and private sector-led projects.

Better days ahead. Valuations are undemanding at 17.4x FY22E P/E (62% below 5Y mean of 46x) and 1.25x P/B (53% below 5Y mean 2.7x), supported by ~RM574m order book (sustainable for 2-3 years) and a strong 31% EPS CAGR from FY21-23. HSSEB is a potential beneficiary of an expected acceleration in infrastructure spending by end 2021 and 2022 post-Covid-19 recovery phase. Current order book stands at ~RM570m (rail: 50%; water: 25%; highway: 15% and infrastructure: 10%) and it remains bullish on expanding its order book with current tenders worth RM437m (engineering: 60%; project management: 37%; and building information modeling: 3%). Its key tendered projects include the MRT3, JB-SRT System, Sarawak Metro, Bayan Lepas LRT, Westports 2.0 expansion, PJD Link Expressway, Rasau Water Supply Scheme (WSS), etc.

Pending a rounding bottom formation. HSSEB offers positive news flow-driven trading opportunities ahead of Budget 2022. After correcting 29% from 52W high of RM0.68 (28 May) to RM0.48 (20 Aug) low, the stock rebounded to end at RM0.575 yesterday. HSSEB is poised for a bullish rounding bottom formation pending a successful breakout above RM0.58 neckline resistance. Clearing this hurdle will lift prices higher towards RM0.60-0.70 zones.


Collection range: RM0.53-0.55-0.575.

Upside targets: RM0.60-0.65-0.70*

Cut loss: RM0.52

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2021-10-13 05:53:09 HLIB Retail Research – 13 Oct - Bullish Tracker:

MFLOUR, 3662 (0.755), Main market , Food & Beverages

Expect poultry sales volume to recover amid eased in dine-in restriction; Showing uptick bias; Pending long-term downtrend line breakout

Time frame: 7 days
Entry: RM0.74-0.76
Stop Loss: RM0.73
Resistance:RM0.80-0.82-0.855
Target price: RM0.80-0.830
Risk profile: Moderate

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2021-10-13 05:36:25 HLIB Retail Research – 13 Oct - Bullish Tracker:

ECONBHD, 5253, (RM0.39) Main market, Construction

Beneficiary of a potential recovery in the infrastructure sctor, indicators moving upwards.

Time frame: 7 days
Entry: RM0.375-0.39
Stop Loss: RM0.365
Resistance:RM0.41-0.455-0.495
Target price: RM0.41-0.43
Risk profile: Moderate

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