Monday, June 03, 2019 FBMKLCI: 1, 650.76

THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY* WWeeeekkllyy SSttrraatteeggyy

Market View, News in Brief: Corporate, Economy, and Share Buybacks

Kaladher Govindan Tel: +603-2167 9609 [email protected] www.taonline.com.my

Market View “Trump Factor” Could Lead to Profit Taking

Last week, the FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI) bucked the weak external market trend as month-end window-dressing lifted the index up to close at a fresh two-month high. This is despite the inclusion of Malaysia in the US Treasury Department’s expanded monitoring list for currency manipulation, and as global markets and crude oil prices tumbled amid worries over the worsening US-China trade tensions.

For the week, the FBM KLCI jumped 52.44 points, or 3.28 percent to 1,650.76, with most of the gains contributed by Tenaga (+RM1.16), Public Bank (+RM1.08), DiGi.com (+41sen), Axiata (+24sen) and Petronas Gas (+RM1.28). Average daily traded volume improved mildly to 2.13 billion shares, compared to the 2.02 billion shares the previous week, while traded value rose to RM2.57 billion, against RM1.71 billion average the previous week, as trading activity focused on the higher priced blue chips space.

As external news flows continue to paint a negative picture on the global economic outlook, the FBMKLCI’s ability to sustain last week’s rebound will be tested this week, ahead of the two and half days of Hari Raya festive holidays. With President Trump threatening to impose tariff on Mexican goods last Friday, China vowing to retaliate on the banning of Huawei by pursuing similar action on US companies (China was supposed to release a white paper on its stance on trade war yesterday and provide more clues on its next course of action with regards to trade war) and yield of short-term securities at key economies like the US climbing at the expense of long-term bonds and unnerving investors, profit taking pressure is likely to increase in this holiday-shortened trading week.

With the first quarter earnings season coming to a conclusion without any significant positive surprises, the focus on the local front this week could be on the April trade data as it is regarded as an important barometer to gauge the impact of the ongoing US-China trade war. Consensus expectations are for both exports and imports to contract by 1.3% year-on- year (YoY) and 0.3% YoY respectively, which will lead to a lower surplus of RM12.5 billion versus RM14.4 billion in March. However, actual data could outperform expectations if April imports data for Malaysia’s largest trading partner, China, is used as a gauge. Despite weaker exports, China’s imports for the month outperformed expectations with imports rising by 4% from a year ago, compared to a contraction of 7.6% YoY in March, as the government’s stimulus measures to shield the economy from trade war showed some results. However, the effectiveness of these measures could wane off without further boosters after the US more than doubled tariff in May and look set to impose harsher penalties on remaining imports from China, most likely in June. This reality was reflected in its May Manufacturing Purchasing Managers Index, which dipped lower to 49.4 versus 50.1 in April.

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Any signs that Malaysia is benefitting from the trade war, albeit likely to be short-term in nature, could help to offset some selling pressure ahead of the festive holidays. The Nikkei Malaysia Purchasing Managers’ Index for May that will be released today as well should have the same impact, if it shows an expansion after recording 49.4 in April, slightly below the growth threshold of 50 points.

In the US, the ISM Manufacturing data for May will be released today as well. It may remain flat on a month-on-month basis as demand for stocking up activities cushion the impact of trade war on factory activities. With its core Personal Consumption Index for April hovering around 1.6%, investors will be watching the non-farm payroll data this week to gauge the possibility of a rate cut later this year or next.

Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy and/ or completeness is not guaranteed and opinions are subject to change without notice. This report is for information only and not to be construed as a solicitation for contracts. We accept no liability for any direct or indirect loss arising from the use of this document. We, our associates, directors, employees may have an interest in the securities and/or companies mentioned herein.

Kaladher Govindan – Head of Research

TA S ECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad

Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 203 2 5048 www.ta.com.my

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News In Brief Corporate

Petroliam Nasional Bhd 's (Not Listed) 1Q19 revenue and net profit increased 7% YoY and 9% to RM62bn and RM14bn, driven by higher sales volume for petroleum products and LNG, coupled with the effect of the weakening ringgit against the USD. (The Star)

Tenaga Nasional Bhd (TNB)’s Chief Executive Officer Amir Hamzah Azizan said it is too early to tell if the issue of overcharged bills would have any financial impact on the group. TNB could only make a conclusion after finding out the amount of refunds to be made. (Bernama)

Sime Darby Plantation Bhd ’s managing director Tan Sri Mohd Bakke Salleh will retire on 30 June 2019 after serving the group for close to 9 years. He would be succeeded by his deputy, Mohamad Helmy Othman Basha. (The Star)

Press Metal Aluminium Holdings Bhd (Not Rated) has entered into a Memorandum of Understanding with PT Bintan Alumina Indonesia (PT BAI) to negotiate a proposed acquisition of a 25% stake in PT BAI. This would allow the group a secure long-term alumina supply, as PT BAI is currently building a million-ton alumina refinery plant and accompanying facilities in Galang Batang in the Riau Islands, Indonesia, with plans for a second phase. (The Edge)

Telekom Malaysia Bhd said its chairman Rosli Man deferred the appointment of a new Chief Executive Officer (CEO) at the behest of the Prime Minister’s Office (PMO). The group said he had informed its Board of Directors in early March 2019 about the PMO’s request. It was confirmed that the Board of Directors had recommended current acting CEO Imri Mokhtar as its Managing Director and CEO to the Ministry of Finance. (The Edge)

CB Industrial Product Holding Bhd (Not Rated) expects its plantation business to break even next year. Managing Director Datuk Lim Chai Beng said that yields from the oil palm trees are increasing steadily. (The Star)

Star Media Group Bhd (Star) has been served with a writ of summons and statement of claim by JAKS Resources Bhd (JAKS) (Not Rated). This is in relation to Tower A, a 15- storey office block in Pacific Star Business Hub in Section 13, which JAKS is to deliver to Star. Among others, claims include a declaration that the completion period for JAKS to deliver Star’s entitlement under the sale and purchase agreement is on 20 June 2020, a declaration that Star has breached the SPA, as well as sum of RM545mn to be paid as liquidated and ascertained damages and loss of proceeds from corporate fund raising exercises. Star would be taking the necessary actions to respond to the claims. (Bursa Malaysia) Comment: We are keeping our estimates for Star unchanged until further developments as the group would be responding to the claim. Note that the ordeal has been on-going since early 2018. Maintain Sell on Star with a TP of RM0.69/share based on 0.6x P/BV.

Mitrajaya Holdings Bhd ’s (Not Rated) wholly owned subsidiary Pembinaan Mitrajaya Sdn Bhd has agreed with Medini Development Sdn Bhd to mutually terminate a contract to undertake a superstructure works for an office tower development at Bandar Medini, Iskandar Malaysia, Johor, with a contract value of RM159.4mn. (The Edge)

New Hoong Fatt Holdings Bhd (Not Rated) has allocated RM30mn as capital expenditure for FY19 to raise production. Managing Director Chin Jit Sin said in FY18, the capex amounted to RM39.4mn, 30.4% lower compared to RM56.6mn in FY17. (Bernama)

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Opcom Holdings Bhd ’s (Not Rated) executive chairman Tan Sri Mokhzani Mahathir resigned due to personal reasons. He was appointed to the group’s board 10 years ago. Separately, Kedah Menteri Besar and brother to Mokhzani, Datuk Seri Mukhriz Mahathir, disposed of 2.6mn shares, trimming his stake to 21.68%. (The Edge)

DBE Gurney Resources Bhd (Not Rated) will jointly develop an affordable housing project in Perak with a gross development value of RM100mn with Silver Homes Development Sdn Bhd, a company controlled by the group's major shareholders. (Bernama)

Tanco Holdings Bhd (Not Rated) and Eduspec Holdings Bhd (Not Rated) have entered into a 20-year land lease agreement to lease a freehold commercial land in Negeri Sembilan for Eduspec to construct and operate the edutainment theme park. Dubbed STEM EduPark, the theme park aims to introduce science, technology, engineering and mathematics-based education to the public. (The Edge)

HPMT Holdings Bhd (Not Rated), which is en route for a Main Market listing on 12 June 2019 said the shares it made available for public subscription under the initial public offering has been oversubscribed by 7 times. (The Edge)

Sime Darby Plantation Bhd ’s 1QFY19 net profit declined 70.3% YoY to RM74mn due to the sharp decline in the average crude palm oil and palm kernel realised prices and higher finance costs, partially mitigated by higher fresh fruit bunch production and improved oil extraction rate, as well as continued earnings improvement from Sime Darby Oils. Revenue declined 17.8% YoY to RM3.0bn. (Bursa Malaysia)

Hap Seng Consolidated Bhd ’s (Not Rated) 1QFY19 net profit increased 2.3% YoY to RM158.0mn with better results from all divisions except for the plantation and automotive divisions. Revenue increased 14.5% YoY to RM1.7bn. A first interim dividend of 15.0sen/share was approved. (Bursa Malaysia)

Malaysia Airports Holdings Bhd ’s (MAHB) 1QFY19 revenue increased 3.0% YoY to RM1.3bn on the back of increased overall passenger growth of 3.7% YoY. Net profit however plunged 66.4% YoY to RM149.6mn due to due to the one-off gains recorded in 1QFY18 in relation to the fair valuation of investment in GMR Hyderabad International Airport Ltd amounting to RM258.4mn and gain on disposal of investment in GMR Male Private Ltd amounting to RM28.2mn. (Bursa Malaysia)

YTL Power International Bhd ’s 3QFY19 net profit declined 23.4% YoY to RM111.3mn. Revenue however increased 11.5% YoY to RM2.9bn, driven by the power generation, multi utilities, water and sewerage, mobile broadband network segment as well as investment holding activities. (Bursa Malaysia)

KPJ Healthcare Bhd ’s 1QFY19 net profit declined 7.9% YoY to RM39.1mn. Revenue and PBT however increased 5.5% YoY and 9.1% YoY to RM868.1mn and RM66.4mn mainly contributed by the increase in number of patient visits and surgeries at its operations in Malaysia. (Bursa Malaysia)

SKP Resources Bhd ’s 4QFY19 revenue and net profit declined 21.9% YoY and 27.8% YoY to RM357.1mn and RM20.4mn mainly due to lower contributions from existing key customers as well as different products mix. FY19 revenue and net profit declined 20.5% YoY and 23.0% YoY to RM1.7bn and RM97.6mn. (Bursa Malaysia)

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Matrix Concepts Holdings Bhd ’s (Not Rated) 4QFY19 revenue and net profit increased 63.7% YoY and 50.0% YoY to RM278.9mn and RM65.9mn mainly on higher revenue recognition from residential properties in Bandar Sri Sendayan. FY19 revenue and net profit increased 28.0% YoY and 2.0% YoY to RM1.0bn and RM217.6mn. A fourth interim dividend and special dividend of 3.0sen/share and 0.25sen/share were declared. (Bursa Malaysia)

LBS Bina Group Bhd ’s (Not Rated) 1QFY19 net profit declined 23.3% YoY to RM17.7mn due to narrowing profit margin from on-going construction projects, loss incurred by a subsidiary company and increase in depreciation and finance costs. Revenue however increased 36.0% YoY to RM326.6mn, on higher revenue from the property development, construction and trading, and management, investment and others segment. (Bursa Malaysia)

Datasonic Group Bhd ’s (Not Rated) 4QFY19’s revenue and net profit declined 12.3% YoY and 33.2% YoY to RM56.7mn and RM11.6mn due to lower supply of consumables, passports and personalization services. FY19’s revenue and net profit declined 15.1% YoY and 45.7% YoY to RM219.6mn and RM36.5mn. A fourth interim dividend of 0.5sen/share was declared. (Bursa Malaysia)

Kumpulan Perangsang Selangor Bhd ’s (Not Rated) 1QFY19 net profit increased 64.3% YoY to RM157.5mn mainly due to contributions from new subsidiaries, CPI (Penang) Sdn Bhd of RM45.6mn and King Koil Manufacturing West, LLC of RM13.8mn. Net profit however plunged 91.2% YoY to RM1.2mn due to the absence of SPLASH contribution following its disposal. (Bursa Malaysia)

Titijaya Land Bhd ’s (Not Rated) 3QFY19 net profit declined 54.1% YoY to RM10.8mn due to the finalisation of cost for the H2O project upon completion and higher marketing expenses. Revenue however increased 33.2% YoY to RM117.6mn contributed by the completion of the overall H2O project and early stage of progressive project recognition for Neu Suites @ 3rdNvenue, The Riv @ Riveria City, The Shore @ Kota Kinabalu and Roseville @ Taman Seri Residensi, Klang. (Bursa Malaysia)

Destini Bhd ’s (Not Rated) 1QFY19 revenue and net profit declined 38.6% YoY and 91.8% YoY to RM84.5mn and RM0.6mn mainly attributed to the decrease in revenue from aviation manufacturing services. (Bursa Malaysia)

Ahmad Zaki Resources Bhd ’s (Not Rated) 1QFY19 net profit declined 59.1% YoY to RM3.7mn due to a general slow-down in nearly all the divisions that the group operates in. Revenue declined 16.7% YoY to RM253.3mn. Except for the concession division, all other operating divisions of the group saw a reduction in revenues. (Bursa Malaysia)

Tiong Nam Logistics Holdings Bhd slipped into the red with a net loss of RM10.3mn in 4QFY19 mainly due to loss making of property development as well as hotel and dormitory segment. Revenue declined 19.3% YoY to RM136.5mn due to the completion of most property development projects. For FY19, the group’s revenue declined 10.1% YoY to RM589.9mn and reported net loss of RM1.4mn versus a net profit of RM31.3mn in FY18. (Bursa Malaysia)

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News In Brief Economy

Malaysia Malaysia's 2018 D ebt, Liabilities D own 3.9 ppts y -o-y in Proportion to GDP, Says Guan Eng Notwithstanding a rise in direct government debt, Malaysia's overall debt and liabilities in 2018 dropped 3.9 percentage points (ppts) to 75.4% of the country's gross domestic product in 2018, versus 79.3% in 2017, following a successful cost rationalisation exercise involving planned mega projects and Public Private Partnership (PPP) payments .

Finance Minister Lim Guan Eng said this in a statement, following his announcement on Saturday that the Debt Management Committee, which he chairs, has convened its first meeting on Friday to tackle the government's debt and liabilities, which stood at RM1.1tln as at end-2018. At the time, he also noted that the government saw a RM54.2bn rise in direct government debt to RM741.0bn from RM686.8bn.

In his statement, he clarified that the federal government's debt and liabilities are made up of three components: direct government debt, committed government guarantees that are serviced by the government, and lease payments from various PPP projects as well as other long-term liabilities. While direct government debt rose by 1.1 ppts to 51.2% of GDP in 2018 from 50.1% in 2017, it was due to the financing of fiscal deficit, which has been done annually under the previous administration. Committed government guarantees also rose 1.8 ppts to 9.2% of GDP in 2018 from 7.4% in 2017, which was caused by continuing payments for various existing infrastructure projects, he said. " These are not new projects and among them are for the MRT (Mass Rapid Transit), Pan-Borneo Highway and the East Coast Rail Link mega-projects entered into by the previous administration ." (Financial Daily)

Japan Ready to Support Additional Samurai Bond Issuance by Malaysia The Japan Bank for International Cooperation (JBIC) is ready to consider further support if Malaysia wishes to issue additional Samurai bonds in the future, said Japanese Prime Minister Shinzo Abe today. This is following the successful issuance of JPY200bn (about RM7.4bn) Samurai bonds guaranteed by JBIC in March 2019, which is expected to help improve Malaysia’s fiscal sustainability and strategic resilience. Abe and Prime Minister Tun Dr Mahathir Mohamad held a bilateral meeting at the Prime Minister’s Office in Nagato- cho, Chiyoda-ku, here. Responding to this, Dr Mahathir said this would enhance financial portfolios and minimise the foreign exchange risks for Malaysia. According to a joint statement on Malaysia-Japan cooperation, both prime ministers shared the view that the joint efforts and collaborations undertaken by both governments would contribute towards reinforcing the strategic partnership between the two nations.

The meeting also took note of comprehensive research for transport improvement in Malaysia which is currently underway by a Japanese team. The research, covering land, sea and air transport, and both passenger and freight transport in scope, is progressing steadily and a final report is expected to be submitted in August. The research would include suggestions for an optimal composition of different modes of transport and ways of making full use of the existing train network. (The Edge)

Retail Fuel Prices To Be Kept Unchanged From June 1 Till June 14 The Ministry of Finance announced today that retail fuel prices will stay unchanged in the upcoming fortnight, from June 1 till June 14, in conjunction with the Hari Raya Aidilfitri celebrations. In a statement, it said retail fuel prices will be maintained using the automatic pricing mechanism. " After June 14, the determination of retail prices for petroleum products will return to original, where the price determination will be done weekly ," it said. For the upcoming June 1 to June 14 period, the retail price of RON97 will be lowered to RM2.63 a litre, versus RM2.76 a litre now, while RON95 will be kept steady at its ceiling of RM2.08 a litre, as opposed to its actual APM price of RM2.33 a litre. Diesel will also be kept at RM2.18 a Page 6 of 10

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litre, versus i ts actu al APM price of RM2.40 a litre. The government expects to spend an estimated RM165.27mn to foot the fuel subsidy bill during the June 1 to June 14 period. (The Edge)

Short-Term Rates Remain Stable on BNM's Operations Short-term interbank rates remained stable on Bank Negara Malaysia's (BNM) operations to absorb surplus liquidity from the financial system. The surplus in the conventional system declined to RM26bn from RM31.96bn this morning, while in the Islamic system, it eased to RM15.10bn from RM17.44bn. Earlier today, BNM issued three conventional money market tenders and an Islamic Range Maturity Auction (iRMA) Qard tender. The central bank also revised the murabahah overnight tender to RM14.6bn from RM12.7bn. At 4 pm, the central bank conducted a RM26bn conventional money market tender and a RM14.6bn Murabahah money market tender, both for three-day money. The average Islamic overnight interest rate stood at 2.96% while the one-week, two and three-week rates were pegged at 3.03%, 3.07% and 3.12% respectively. (The Edge)

Asia China V ice Minister Says US O verestimates Trade D eficit Chinese Vice Commerce Minister Wang Shouwen said on Sunday the United States overestimates the trade deficit between the two countries and China should not be blamed for job losses in the U.S. manufacturing sector. Wang told a news conference the US goods and services deficit with China is actually closer to US$150bn and not the US$410bn quoted by US officials. China's processing trade with the United States should not be included in trade deficit calculations, he added. Wang said China should not be blamed for job losses in the US manufacturing sector. He also said China does not instruct domestic companies to acquire certain projects and technology.

Wang said the commerce ministry is investigating reports of delays in customs checks, adding that the country will make efforts to cut the length of customs checks and reduce costs for importers. Wang said that it is "unacceptable" if some countries use rare earths from China to create products that limit China's development, and he said China is willing to meet other countries' requirements for rare earth consumption. (Reuters)

Japan Housing Starts Falls For First Time In 5 Months Japan's housing starts declined for the first time in five months in April, data from the Ministry of Land, Infrastructure, Transport and Tourism revealed on Friday. Housing starts dropped 5.7% year-on-year in April, after a 10.0% increase in March. Economists had forecast the housing starts to fall 0.8%. This was the first decline since December. Annualized housing starts decreased to 931,000 in April from 989,000 in the previous month. The expected level was 983,000. Construction orders received by 50 big contractors declined 19.9% in April from last year compared to a sharp growth of 66.1% in March.

Separately, Industrial output in Japan rose a seasonally adjusted 0.6% on month in April, the Ministry of Economy, Trade and Industry said in Friday's preliminary reading. That exceeded expectations for an increase of 0.2% following the 0.6% decline in March. On a yearly basis, industrial production sank 1.1% - also topping forecasts for a decline of 1.5% following the 4.3% drop in the previous month. Upon the release of the data, the METI's assessment of industrial production was that it continues to fluctuate indecisively. In April, the production of motor vehicles, production machinery and transport equipment increase - while the production of business-oriented machinery, electronic part and chemicals was down. (RTT)

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S&P Raises Indonesia’s Rating to ‘BBB’ on Strong Economic Prospects Ratings agency S&P said on Friday it had raised Indonesia’s sovereign credit rating to ‘BBB’, citing the country’s strong economic growth prospects and supportive policy dynamics. S&P had previously rated Indonesia at ‘BBB-’, the lowest investable grade awarded by the agency. The upgrade put S&P on par with the ratings awarded by two other major credit rating agencies, Fitch and Moody’s. S&P also raised its short-term sovereign credit rating to ‘A-2’ from ‘A-3’. “We raised the ratings to reflect Indonesia’s strong economic growth prospects and supportive policy dynamics, which we expect to remain following the re- election of President Joko Widodo recently,” S&P said in a statement. Re-elected in April, Widodo is expected to continue to invest in infrastructure, though Widodo first has to overcome a challenge to his election victory that has been lodged by a rival in the Constitutional Court. “The sovereign ratings on Indonesia continue to be supported by the government’s relatively low debt and its moderate fiscal performance,” it added.

S&P gave the new rating a stable outlook and said it would continue to monitor the country’s external and fiscal balances over the next two years for a future rating decision. Amid bouts of volatility in emerging markets in recent years, Indonesia’s widening current account deficit has been a source of concern. Bank Indonesia after its May policy meeting adjusted its outlook for the current account deficit to 2.5%-3% of GDP due to the U.S.- China trade war and global growth slowdown, from an initial outlook of 2.5% of GDP. The current account gap was 3% of GDP last year. (The Star)

Shrinking China Factory Activity, Faltering Exports Inflame Economic Anxiety Friday’s weak manufacturing readings, which follow a recent raft of soft data across the retail, export and construction sectors, could inflame concerns about the risk of a global recession and push more central banks to adopt an accommodative monetary stance. The official Purchasing Managers’ Index (PMI) fell to 49.4 in May from 50.1 in April, data from the statistics bureau showed. Analysts surveyed by Reuters had forecast the PMI to be down a notch at 49.9, below the 50-point mark separates expansion from contraction on a monthly basis. Factory output expanded at a slower pace as new orders - a gauge of domestic and foreign demand - fell for the first time in four months. Export orders extended their decline for the twelfth straight month with the sub-index pulling back significantly to 46.5 from April’s 49.2, suggesting a further weakening in global demand. Export orders dropped back particularly sharply, which suggests that Trump’s latest tariff hike may already be undermining foreign demand. While China’s exporters are feeling the pinch, Friday’s data showed import orders also contracted at a quicker pace, reflecting softening demand at home despite a flurry of growth-supporting measures that were rolled out earlier this year. (Reuters)

United States US Inflation Picked Up in April US inflation picked up in April after a very weak start to the year, a development that could help to ease Federal Reserve officials’ recent concerns about tepid price pressures. The Fed’s preferred inflation gauge, the price index for personal-consumption expenditures, rose a seasonally adjusted 0.31% in April from March and 1.51% from a year earlier, the Commerce Department said Friday. Excluding volatile food and energy items, the so-called core PCE price index was up 0.25% from March—the fastest monthly pace since October 2016—and 1.57% from April 2018. Economist surveyed by The Wall Street Journal had expected core PCE prices to rise 0.2% on the month and 1.6% on the year. The Commerce Department also revised down its inflation numbers for the first three months of the year. The PCE price index in March was up 1.44% from the year-ago month, down from a previous estimate of 1.49%. Inflation remains well below the Fed’s 2% target, a level central bankers view as consistent with a solid economy. They worry a slower rate could be a sign of weak domestic demand. At a time of low unemployment and solid economic growth, Fed officials also fear that tepid price pressures could cause consumers and

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businesses to expe ct low inflation in the future, becoming a self -fulfilling prophecy that would make it harder to hit their target. Worse still, low inflation could give way to deflation—an economically dangerous fall in prices—during a recession. (WSJ)

US Consumer Spending Cools in April US household spending slowed in April, another sign that the economy lost momentum this spring after a strong start to the year. Personal-consumption expenditures, a measure of household spending on everything from carpet cleaning to computers increased a seasonally adjusted 0.3% in April from March, the Commerce Department said Friday. That marked a sharp slowdown from March’s robust gain, the best monthly increase since 2009. The report showed personal income, which includes Americans’ pretax earnings from wages, salaries and investments, advanced 0.5% in April from the prior month. That was the best gain this year. Economists surveyed by The Wall Street Journal had expected consumer spending would rise 0.2% in April and incomes would increase by 0.3%. Consumer spending is the driving force behind the U.S. economy, accounting for better than two-thirds of total economic output. The current expansion will be 10 years old in June, and it will become the longest on record if it continues into July. Economists generally expect the expansion to continue for a while, as low unemployment and rising incomes encourage consumers to shop, visit restaurants, make home improvements and take vacations. But forecasters also project growth to slow and cite a number of risks. (WSJ)

Euro Area UK Consumer Sentiment Strengthens Despite Brexit Uncertainty UK consumer confidence improved in May despite Brexit related uncertainties, survey data from market research group GfK showed Friday. The consumer sentiment index rose to -10 from -13 in April. The expected score was -12. Four measures increased and one remained unchanged in May. The index measuring changes in personal finances during the last 12 months rose to +3 from -1. The forecast for personal finances over the next 12 months also increased by five points to +5. The measure for the general economic situation of the country over the last year remained the same, at -30. Expectations for the general economic situation over the next 12 months climbed five points to -29 and the major purchase index gained two points to +1 in May 2019. (RTT)

German Inflation Slows More Than Expected; Retail Sales Rebound Germany's inflation slowed sharply in May and at a faster-than-expected pace, as food price growth remained sluggish and services cost increases were weaker, preliminary data from the Federal Statistical Office showed on Friday. Data released earlier in the day showed that retail sales rebounded in April from last year, driven by the timing of Easter. The consumer price index rose 1.4% year-on-year in May after a 2% increase in April, which was the fastest in five months. Economists had forecast price growth of 1.6%. In March, inflation was 1.3%. Retail sales rebounded at a faster-than-expected pace of 4% annually in April, reversing a 2% fall in March. Sales were forecast to grow moderately by 1.3%. The timing of Easter had a positive effect on the year-on-year development of turnover in April, Destatis said. Elsewhere, energy inflation slowed to 4.2% in May from 4.6%, while food price growth climbed to 0.9% from 0.8%. (RTT)

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News In Brief Share Buy-Back

Share Buy-Back: 31 May 2019 Total Treasury Company Bought Back Price (RM) Hi/Lo (RM) Shares ANCOM 35,000 0.47/0.46 0.47/0.46 9,887,959 BONIA 1,701,500 0.300 0.305/0.29 12,120,800 EG 1,286,800 0.41 0.425/0.40 15,127,100 ENGTEX 126,400 0.72 0.745/0.715 4,081,000 FIAMMA 342,900 0.48 0.48/0.475 34,866,200 KFIMA 5,000 1.67 1.68/1.67 830,500 NYLEX 188,500 0.64/0.625 0.64/0.625 14,689,324 P&O 2,000 1.00 0.995/0.985 15,208,893 SUNWAY 300,000 1.69/1.68 1.69/1.68 43,521,930 SYF 172,000 0.20/0.195 0.20/0.19 23,517,800 SYSCORP 48,000 0.30 0.30 28,255,400 TECFAST 205,000 0.25/0.245 0.25/0.245 820,000 TITIJYA 145,000 0.295/0.29 0.295/0.29 71,416,000 Source: Bursa Malaysia

Disclaimer The information in this report has been obtained from sources believed to be reliable. Its accuracy and/ or completeness is not guaranteed and opinions are subject to change without notice. This report is for information only and not to be construed as a solicitation for contracts. We accept no liability for any direct or indirect loss arising from the use of this document. We, our associates, directors, employees may have an interest in the securities and/or companies mentioned herein.

Kaladher Govindan – Head of Research

TA S ECURITIES HOLDINGS BERHAD (14948-M) A Participating Organisation of Bursa Malaysia Securities Berhad

Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia Tel: 603 – 2072 1277 Fax: 603 – 203 2 5048 www.ta.co m.my

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For Internal Circulation Only SNAPSHOT OF STOCKS UNDER COVERAGE

Company Share Price Target Price Market Cap. EPS (sen) PER (X) Div Yield (%) 52weeks 52weeks % Chg % upside Recom Beta (RM) (RM) (RMm) FY19 FY20 FY19 FY20 FY19 FY20 High Price % Chg Low Price % Chg YTD 31-May-19 AUTOMOBILE BAUTO 2.30 2.93 27.4% Buy 2,668 0.59 21.8 23.1 10.6 9.9 7.1 7.5 2.48 -7.3 1.80 27.8 7.0 MBMR 2.92 3.36 15.1% Buy 1,141 0.62 40.5 42.0 7.2 6.9 2.1 2.1 3.08 -5.2 1.86 57.0 32.7 PECCA 1.06 1.28 20.8% Buy 194 0.74 9.4 10.3 11.3 10.3 6.6 7.5 1.15 -7.8 0.69 54.7 44.2 SIME 2.32 2.31 -0.4% Sell 15,778 1.63 16.3 15.3 14.2 15.2 4.2 3.9 2.73 -15.0 2.04 13.7 -3.3 UMW 5.09 5.42 6.5% Sell 5,947 0.59 39.6 41.1 12.9 12.4 1.4 1.4 6.79 -25.0 4.20 21.2 -6.9

BANKS & FINANCIAL SERVICES ABMB 3.85 4.20 9.1% Buy 5,960 0.82 34.7 36.6 11.1 10.5 4.3 4.5 4.49 -14.3 3.57 7.8 -4.2 AFFIN 2.11 2.50 18.5% Buy 4,191 0.89 26.7 28.7 7.9 7.4 4.7 4.7 2.63 -19.8 2.05 2.9 -5.4 AMBANK 4.43 4.70 6.1% Hold 13,353 1.19 42.2 45.4 10.5 9.8 4.5 4.5 4.64 -4.5 3.60 23.1 2.1 CIMB 5.27 5.80 10.1% Buy 51,263 1.39 50.9 58.0 10.3 9.1 4.9 5.5 6.56 -19.7 5.00 5.4 -7.7 HLBANK 19.00 20.30 6.8% Hold 38,866 0.85 136.5 147.2 13.9 12.9 2.5 2.5 21.66 -12.3 17.56 8.2 -6.9 MAYBANK 9.02 9.30 3.1% Hold 99,668 0.88 77.3 82.5 11.7 10.9 6.4 6.4 10.14 -11.0 8.68 3.9 -5.1 PBBANK 23.60 22.90 -3.0% Sell 91,618 0.86 147.6 157.5 16.0 15.0 2.9 2.9 26.16 -9.8 22.02 7.2 -4.7 RHBBANK 5.83 6.50 11.5% Buy 23,379 1.08 60.0 64.0 9.7 9.1 3.8 3.8 6.07 -4.0 5.05 15.4 10.2 BURSA 6.50 6.30 -3.1% Sell 5,249 0.90 26.4 27.7 24.6 23.5 3.7 3.7 7.96 -18.3 5.92 9.8 -5.0

BUILDING MATERIALS ANNJOO 1.41 1.00 -29.1% Sell 760 1.60 -2.1 9.6 na 14.7 0.0 2.8 2.40 -41.3 1.15 22.6 12.8 CHINHIN 0.74 0.70 -5.4% Sell 407 1.00 6.1 7.8 12.1 9.4 1.6 2.6 0.89 -16.4 0.63 17.5 2.1 CHINWEL 1.76 2.20 25.0% Buy 517 0.79 20.2 21.8 8.7 8.1 4.5 4.8 2.00 -12.0 1.49 18.1 8.6 CMSB 3.09 3.78 22.3% Buy 3,314 1.61 20.8 21.6 14.9 14.3 2.7 2.8 3.92 -21.2 2.26 36.7 14.9 CSCSTEL 1.05 1.10 4.8% Sell 388 1.03 5.6 6.8 18.7 15.5 2.6 3.1 1.40 -25.0 0.98 7.7 2.9 ENGTEX 0.72 0.80 11.1% Sell 314 0.89 2.9 4.4 25.2 16.2 0.4 0.9 1.23 -41.5 0.72 0.7 -12.7

CONSTRUCTION GADANG 0.86 0.98 14.0% Buy 569 1.69 9.6 11.9 9.0 7.2 2.3 2.3 0.96 -10.4 0.48 81.1 68.6 GAMUDA 3.49 3.22 -7.7% Hold 8,616 1.51 25.4 27.8 13.7 12.6 3.4 3.4 4.04 -13.6 2.00 74.5 49.1 Note: GAMUDA proposed 1 for 4 rights issue warrants. For more details please refer to 17.12.18 report. GDB 0.29 0.31 5.2% Buy 181 na 4.1 3.4 7.1 8.5 5.2 5.2 0.45 -35.6 0.22 31.8 26.1 IJM 2.22 2.22 0.0% Buy 8,050 1.67 9.5 10.6 23.4 21.0 1.8 2.3 2.37 -6.3 1.39 59.7 37.0 KAB 0.21 0.31 45.2% Buy 70 na 3.0 3.1 7.0 6.8 4.8 4.8 0.31 -32.3 0.19 13.5 7.7 PESONA 0.24 0.26 10.6% Buy 163 1.42 2.8 2.7 8.5 8.6 4.3 4.3 0.37 -35.6 0.17 38.2 23.7 SENDAI 0.42 0.37 -11.9% Sell 328 1.43 7.0 6.2 6.0 6.8 0.0 2.4 1.09 -61.5 0.39 7.7 -37.3 SUNCON 1.96 1.64 -16.3% Sell 2,532 1.27 11.0 11.7 17.8 16.7 4.1 4.1 2.09 -6.2 1.30 50.8 47.4 WCT 0.95 0.92 -3.7% Sell 1,312 1.30 4.0 3.9 23.7 24.1 2.1 2.1 1.16 -18.1 0.66 43.9 40.7 LITRAK 4.22 4.71 11.6% Buy 2,228 0.56 44.7 43.8 9.4 9.6 5.9 5.9 5.90 -28.5 3.72 13.4 1.7

CONSUMER Brewery CARLSBG 24.38 25.90 6.2% Hold 7,500 0.57 95.9 100.5 25.4 24.3 3.9 4.1 27.34 -10.8 17.06 42.9 24.1 HEIM 24.52 27.00 10.1% Buy 7,407 0.64 104.1 110.7 23.6 22.2 4.1 4.4 25.10 -2.3 17.42 40.8 19.8 Retail AEON 1.51 1.75 15.9% Buy 2,120 0.75 10.1 10.7 15.0 14.1 3.3 3.6 2.50 -39.6 1.38 9.4 2.7 AMWAY 5.83 7.76 33.1% Buy 958 0.64 37.5 40.5 15.6 14.4 5.1 5.6 7.70 -24.3 5.53 5.4 -1.6 F&N 34.20 28.77 -15.9% Sell 12,544 0.82 121.6 126.1 28.1 27.1 2.0 2.2 40.00 -14.5 29.20 17.1 2.1 FOCUSP 0.42 0.66 59.0% Buy 68 na 5.1 5.5 8.1 7.5 3.7 4.0 0.49 -15.3 0.16 159.4 118.4 HUPSENG 0.96 1.24 29.8% Buy 764 0.43 5.3 6.0 17.9 16.0 6.3 6.3 1.12 -14.7 0.94 1.6 0.5 JOHOTIN 1.39 1.80 29.5% Buy 432 1.13 11.8 14.1 11.8 9.8 3.6 4.3 1.60 -13.1 0.84 66.5 44.8 LHI 1.04 1.43 37.5% Buy 3,796 na 6.9 7.5 15.0 13.8 2.0 2.2 1.19 -12.6 1.01 3.0 -5.5 NESTLE 147.00 159.60 8.6% Hold 34,472 0.59 310.0 332.9 47.4 44.2 2.1 2.3 150.60 -2.4 142.80 2.9 -0.3 PADINI 3.72 4.28 15.1% Hold 2,447 0.63 22.8 25.6 16.3 14.5 3.1 3.2 6.20 -40.0 3.15 18.1 6.0 POHUAT 1.51 1.88 24.5% Buy 334 0.63 22.5 23.6 6.7 6.4 5.3 5.3 1.64 -7.9 1.26 19.8 0.7 QL 6.84 6.58 -3.8% Sell 11,097 0.74 13.5 15.5 50.8 44.1 0.7 0.7 7.63 -10.4 5.32 28.6 0.4 SCIENTX 8.41 9.80 16.5% Buy 4,333 0.76 62.5 75.6 13.4 11.1 2.5 2.7 9.48 -11.3 6.51 29.2 -5.0 SIGN 0.46 0.60 31.9% Buy 102 0.65 2.1 4.6 21.6 9.9 3.3 4.0 0.68 -32.6 0.32 44.4 35.8 Tobacco BAT 30.00 32.50 8.3% Sell 8,566 0.70 135.3 136.2 22.2 22.0 4.3 4.5 38.68 -22.4 28.80 4.2 -16.9

GAMING Casino GENTING 6.39 6.84 7.0% Hold 24,605 1.07 49.6 56.9 12.9 11.2 2.2 2.5 8.89 -28.1 5.85 9.2 5.8 GENM 3.14 3.25 3.5% Sell 17,752 1.34 17.1 23.5 18.3 13.4 2.5 3.2 5.23 -39.9 2.70 16.5 6.5 NFO BJTOTO 2.51 2.21 -12.0% Sell 3,381 0.73 22.0 20.0 11.4 12.5 6.0 5.6 2.65 -5.3 2.01 24.9 19.0

HEALTHCARE Hospitals/ Pharmaceutical DPHARMA 1.34 1.62 20.9% Buy 887 0.63 7.9 8.4 17.0 16.0 4.2 4.5 1.49 -10.1 0.93 44.9 41.1 IHH 5.50 5.90 7.3% Hold 48,245 0.64 10.9 12.4 50.3 44.3 0.5 0.6 6.19 -11.1 4.54 21.1 2.0 KPJ 0.93 1.05 12.9% Buy 4,020 0.65 4.3 4.7 21.4 19.7 2.2 2.5 1.17 -20.5 0.92 1.1 -10.6 Rubber Gloves HARTA 5.20 4.31 -17.1% Sell 17,397 0.92 13.6 14.9 38.1 34.8 1.6 1.7 7.45 -30.2 4.52 15.0 -15.3 KOSSAN 3.96 5.10 28.8% Buy 5,065 0.64 19.3 21.3 20.5 18.6 1.9 2.1 4.72 -16.1 3.44 15.1 -8.8 SUPERMX 1.62 1.77 9.3% Buy 2,117 0.91 9.9 10.6 16.3 15.2 2.8 3.1 2.31 -29.7 1.30 24.6 -6.9 TOPGLOV 5.05 4.71 -6.7% Hold 12,910 0.42 17.6 19.2 28.7 26.3 1.7 1.9 6.36 -20.6 4.24 19.2 -9.8

MEDIA ASTRO 1.39 1.60 15.1% Hold 7,248 1.35 10.8 12.3 12.9 11.3 6.5 7.6 1.97 -29.4 1.05 32.4 6.9 MEDIA PRIMA 0.36 0.31 -13.9% Sell 399 0.77 -7.4 -5.8 na na 0.0 0.0 0.60 -40.0 0.33 10.8 4.3 STAR 0.65 0.69 6.2% Sell 480 1.00 1.9 2.0 34.9 31.9 0.7 0.8 1.28 -49.2 0.62 4.8 -5.1

For Internal Circulation Only SNAPSHOT OF STOCKS UNDER COVERAGE

Company Share Price Target Price Market Cap. EPS (sen) PER (X) Div Yield (%) 52weeks 52weeks % Chg % upside Recom Beta (RM) (RM) (RMm) FY19 FY20 FY19 FY20 FY19 FY20 High Price % Chg Low Price % Chg YTD

OIL & GAS LCTITAN 3.00 3.40 13.3% Sell 6,819 0.93 22.8 30.0 13.2 10.0 3.7 4.7 5.45 -45.0 2.92 2.7 -35.1 MHB 0.72 0.74 3.5% Sell 1,144 1.61 -2.7 1.2 na 59.9 0.0 0.0 0.87 -17.3 0.50 44.4 31.2 MISC 6.95 6.30 -9.4% Sell 31,023 0.98 38.4 42.0 18.1 16.5 4.3 4.3 7.22 -3.7 5.48 26.8 3.7 PANTECH 0.52 0.73 40.4% Buy 390 1.01 6.4 7.0 8.2 7.4 3.9 4.1 0.64 -18.6 0.41 26.6 20.7 PCHEM 8.32 9.10 9.4% Hold 66,560 0.68 49.7 56.0 16.7 14.9 3.0 3.4 10.20 -18.4 8.09 2.8 -10.4 SERBADK 4.10 5.00 22.0% Buy 6,021 1.10 31.0 33.5 13.2 12.2 2.2 2.4 4.28 -4.2 3.06 34.0 8.5 UZMA 0.76 0.80 6.0% Sell 13,556 1.48 6.1 9.5 12.3 7.9 0.0 0.0 1.51 -50.0 0.55 37.3 31.3 VELESTO 0.29 0.34 17.2% Buy 2,383 1.83 0.2 0.4 148.6 75.8 0.0 0.0 0.33 -10.8 0.17 75.8 61.1

PLANTATIONS FGV 1.14 1.05 -7.9% Sell 4,159 1.48 -3.1 -2.8 na na 0.0 0.0 1.75 -34.9 0.63 81.0 59.4 IJMPLNT 1.50 1.39 -7.3% Sell 1,321 0.90 -2.1 5.2 na 29.1 1.3 1.3 2.61 -42.5 1.30 15.4 7.1 IOICORP 4.31 4.31 0.0% Sell 26,320 0.78 11.7 16.5 37.0 26.2 1.6 2.2 4.74 -9.1 4.10 5.1 -3.1 KFIMA 1.68 1.89 12.5% Buy 473 0.69 11.8 12.4 14.3 13.5 5.4 5.4 1.76 -4.5 1.41 19.1 10.5 KLK 24.80 19.35 -22.0% Sell 26,411 0.54 68.3 79.6 36.3 31.2 1.3 1.6 25.78 -3.8 23.26 6.6 0.3 SIMEPLT 4.66 4.60 -1.3% Sell 32,082 na 9.6 15.7 48.5 29.8 1.7 2.4 5.45 -14.6 3.95 18.0 -2.1 TSH 0.93 0.95 2.2% Sell 1,285 0.46 2.9 4.0 32.1 23.4 1.1 1.3 1.25 -25.6 0.87 6.9 -6.1 UMCCA 5.20 5.88 13.1% Hold 1,090 0.53 -6.1 13.8 na 37.6 1.5 1.5 6.53 -20.4 5.12 1.6 -0.2

PROPERTY GLOMAC 0.36 0.38 7.0% Sell 277 0.59 0.7 2.2 52.1 16.5 1.4 2.8 0.51 -29.7 0.35 1.4 -9.0 HUAYANG 0.31 0.43 41.0% Buy 107 0.65 -3.6 3.4 na 8.8 0.0 0.0 0.50 -39.0 0.30 1.7 -11.6 IBRACO 0.68 0.70 2.9% Hold 338 0.47 7.4 9.1 9.2 7.5 4.0 4.0 0.75 -9.3 0.15 353.3 14.3 IOIPG 1.34 1.79 33.6% Buy 7,378 1.33 14.4 14.5 9.3 9.2 3.7 3.7 1.92 -30.2 1.16 15.5 -13.0 MAHSING 0.91 1.07 18.2% Buy 2,197 0.87 8.8 9.0 10.3 10.1 5.5 5.5 1.32 -31.4 0.89 1.7 -1.1 SIMEPROP 1.06 1.14 7.5% Hold 7,209 na 5.5 7.7 19.2 13.8 1.9 2.8 1.47 -27.9 0.91 17.1 6.5 SNTORIA 0.31 0.32 3.2% Sell 173 0.57 3.6 4.5 8.5 6.8 0.0 3.2 0.61 -49.2 0.30 3.3 -22.5 SPSETIA 2.19 2.24 2.3% Hold 8,831 1.29 10.3 14.2 21.3 15.4 3.4 4.1 3.30 -33.6 1.87 17.1 -6.0 SUNWAY 1.69 1.65 -2.4% Sell 8,251 0.88 12.5 13.7 13.5 12.3 4.4 4.4 1.72 -1.7 1.34 26.4 16.1 REIT CMMT 1.11 1.26 13.5% Buy 2,269 0.54 6.9 7.4 16.1 15.0 6.7 7.0 1.26 -11.9 0.99 12.1 9.9 SUNREIT 1.86 2.07 11.3% Hold 5,478 0.57 10.0 10.9 18.7 17.0 5.4 5.9 1.97 -5.6 1.61 15.5 7.5

POWER & UTILITIES MALAKOF 0.83 0.93 12.0% Buy 4,056 1.17 5.1 5.7 16.3 14.6 6.7 6.9 1.04 -20.2 0.75 11.4 3.7 PETDAG 25.76 25.90 0.5% Hold 25,591 0.80 105.7 108.1 24.4 23.8 3.5 3.5 28.48 -9.6 23.00 12.0 -2.8 PETGAS 17.66 16.50 -6.6% Sell 34,944 0.99 97.3 98.3 18.2 18.0 4.1 4.2 20.00 -11.7 15.90 11.1 -8.0 TENAGA 12.70 12.20 -3.9% Hold 72,223 1.17 97.7 98.7 13.0 12.9 4.3 4.3 16.00 -20.6 11.24 13.0 -6.6 YTLPOWR 0.85 0.77 -8.9% Sell 6,486 0.99 7.1 8.0 11.8 10.6 5.9 5.9 1.27 -33.5 0.79 7.0 1.8

TELECOMMUNICATIONS AXIATA 4.69 4.90 4.5% Hold 42,813 1.62 9.6 13.0 48.8 36.0 1.8 2.4 4.85 -3.3 3.20 46.6 19.3 DIGI 4.97 4.25 -14.5% Sell 38,642 1.14 19.7 20.6 25.2 24.1 3.8 3.9 5.04 -1.4 3.93 26.5 10.4 MAXIS 5.54 4.75 -14.3% Sell 43,304 0.89 20.9 21.1 26.5 26.3 3.6 3.6 5.89 -5.9 5.13 8.0 3.6 TM 3.61 3.60 -0.3% Hold 13,566 2.13 25.6 26.8 14.1 13.5 3.5 3.7 4.13 -12.6 2.11 71.1 35.7

TECHNOLOGY Semiconductor & Electronics ELSOFT 0.80 0.80 0.6% Sell 529 0.87 4.4 5.3 17.9 14.9 4.0 4.8 1.50 -47.0 0.77 3.9 -27.1 INARI 1.54 1.75 13.6% Buy 4,891 0.94 6.3 8.0 24.3 19.2 3.3 4.1 2.56 -39.7 1.22 26.2 2.7 MPI 8.94 9.00 0.7% Sell 1,778 0.93 63.0 70.8 14.2 12.6 3.0 3.2 13.20 -32.3 8.60 4.0 -10.2 N2N 0.75 1.02 36.9% Buy 416 0.83 3.9 4.6 19.0 16.3 4.0 4.0 1.37 -45.6 0.70 6.4 -29.0 SKPRES 1.30 1.57 20.8% Buy 1,688 1.22 7.8 9.9 16.7 13.2 3.0 3.8 1.62 -19.8 0.95 37.6 23.8 UNISEM 2.53 2.15 -15.0% Sell 1,840 0.74 11.2 15.3 22.6 16.5 3.0 3.0 3.30 -23.3 2.27 11.5 -22.9

TRANSPORTATION Airlines AIRASIA 2.89 3.13 8.3% Buy 9,658 1.62 14.8 26.0 19.6 11.1 31.1 4.2 3.29 -12.2 2.00 44.7 -2.7 AIRPORT 7.34 8.47 15.4% Buy 12,178 1.06 35.0 39.9 21.0 18.4 2.0 2.3 9.98 -26.5 6.60 11.2 -12.4 Freight & Tankers PTRANS 0.20 0.44 125.6% Buy 277 0.87 2.9 3.5 6.8 5.6 5.2 6.3 0.32 -38.1 0.20 0.0 -17.0 TNLOGIS 0.47 0.77 63.8% Buy 211 0.61 -1.2 3.8 na 12.5 0.0 0.0 1.16 -59.5 0.47 0.0 -36.1 WPRTS 3.88 3.95 1.8% Hold 13,231 0.83 20.6 24.0 18.8 16.1 4.0 4.6 4.00 -3.0 3.28 18.3 7.2

SNAPSHOT OF FOREIGN STOCKS UNDER COVERAGE

Company Share Price Target Price Market Cap. EPS (cent) PER (X) Div Yield (%) 52week 52week % Chg % upside Recom Beta (S$) (S$) (S$m) FY19 FY20 FY19 FY20 FY19 FY20 High Price % Chg Low Price % Chg YTD BANKS & FINANCIAL SERVICES DBS 24.60 29.50 19.9% Hold 62,882 1.26 233.0 256.7 10.6 9.6 4.9 4.9 29.3 -15.9 22.65 8.6 3.8 OCBC 10.74 13.20 22.9% Buy 45,656 1.22 115.0 125.4 9.3 8.6 4.0 4.0 12.9 -16.8 10.36 3.7 -4.6 UOB 23.89 31.70 32.7% Buy 39,853 1.25 255.4 278.7 9.4 8.6 5.0 5.0 28.5 -16.3 23.63 1.1 -2.0

PLANTATIONS WILMAR 3.30 3.80 15.2% Hold 21,115 0.70 27.6 30.4 11.9 10.9 3.3 3.6 3.7 -10.6 2.97 11.1 5.8

BUY : Total return within the next 12 months exceeds required rate of return by 5%-point. HOLD : Total return within the next 12 months exceeds required rate of return by between 0-5%-point. SELL : Total return is lower than the required rate of return.

Total Return is defined as expected share price appreciation plus gross dividend over the next 12 months. Gross dividend is excluded from total return if dividend discount model valuation is used to avoid double counting. Required Rate of Return of 7% is defined as the yield for one-year Malaysian government treasury plus assumed equity risk premium.