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5

CORPORATE (CATEGORIESCORPORATE)

FROM THE EDGE (PRINT-EDITION)

Edge Weekly (ash-categoriesedge-weekly)

Select Language

Capital The Edge Best Call Awards2017Cindy Yeap and Kathy Fong(authorCindy Yeap and Kathy Fong)

theedgemarketscom(sourcetheedgemarketscom)

January 04 2018 1400 pm +08



This article rst appeared in Capital The Edge Malaysia Weekly on December 25 2017 - December

31 2017

PICKINGS were better this year with several stocks performing much better

than expected mdash surprising even the analysts some of whom were rewarded

for choosing to retain a ldquobuyrdquo call against consensus

After three straight years of annual declines at the FBM KLCI (something that

has only happened once in the past four decades) the bellwether index mdash

which rose by as much as 94 to 179675 points on June 16 mdash closed at

174663 points on Dec 20 mdash up 64 from the start of the year The broader

FBM Emas Index meanwhile was 976 higher year to date at 1258559

points last Wednesday

The winners in the 12th edition of The Edgersquos Best Call Awards for 2017 were

selected from 90 recommendations for 66 stocks received from 16 research

houses

Last year we received 86 nominations for 75 stocks from 14 outts Most

nominations were from heads of research and the analysts themselves

others being fund managers and other analysts for their fellow colleagues

The winners include those who rightly stuck their neck out by calling an

outright ldquosellrdquo (instead of just whispering it to clients) and were proved right

We were tempted to include more names as there were several other good

calls but we decided to stop at 17 for 2017

Like last year we made some allowances for calls made in 2016 that proved

right in 2017 This yearrsquos list of 17 winners are our best-eort attempt to

recognise good fundamental stock analysis and its importance in making

investment decisions based on submissions and publicly available data



Feedback on the methodology and winners is welcome at

bestcallsbizedgecom Feedback is also welcome on whether you would like

The Edge to have a fund managersrsquo poll on their best analysts and

recommendations

With that here are this yearrsquos winners in no particular order Congratulations

to the winners To the good stock pickers who slipped under our radar keep

up the good work Merry Christmas and a Happy New Year

RHB Research Institute former analyst Ng Sem Guan and analyst

Muhammad Syaq Mohd Salamrsquos call on Press Metal Aluminium Holdings

Bhd

By the time Press Metal was included as an FBM KLCI constituent on Dec 18

the largest integrated aluminium producer in Southeast Asia already had a

market capitalisation of close to RM20 billion It may be hard to imagine that

the stock just crossed RM1 billion market capitalisation barely ve years ago

in early 2013 By end-2016 its market capitalisation had risen to nearly RM6

billion double what it was the year before

When RHBrsquos former analyst Ng Sem Guan started coverage in June 2013 the

comparable (adjusted) share price was 397 sen Four-and-a-half years on the

stock is up a whopping 1154 to RM498 as at Dec 15 Total returns are six

times higher with Press Metal paying dividends every quarter for the past



three years up from twice a year before that Bloomberg data shows It also

had a two-for-one stock split and 40 bonus issue in 2016 Ng was also

acknowledged for his early ldquobuyrdquo call on Press Metal last year

According to Bloomberg data RHBrsquos Muhammad Syaq Mohd Salam

reiterated a ldquobuyrdquo recommendation when assuming coverage on Aug 17 this

year In a note dated Nov 1 he told clients that Press Metalrsquos size (RM16 billion

marketcap) meant that it could be included as an index constituent about a

month before the inclusion was announced

Press Metal which ran 113 from the start of the year to RM332 on Aug 17

appreciated another 50 over four months to RM498 on Dec 15 mdash bringing

total gains for the year to 213

At the time of writing RHB still had a ldquobuyrdquo recommendation and its RM530

target price mdash the highest among four analysts tracking the stock mdash implying

only 64 upside potential Risks to his forecast include a sharply weaker

greenback lower aluminium prices and unexpected production disruptions

A notable mention also goes to Kenanga Researchrsquos Voon Yee Ping who also

rightly stuck with a ldquobuyrdquo recommendation this year despite the strong price

gains Two other houses had ldquoneutralrdquo calls from April and August when the

stock was below RM350 Bloomberg data show

It remains to be seen if Press Metal will provide reasons for further

bullishness but the stock did reach RM547 intraday on Dec 4 although its

highest close so far was RM5184 on Nov 6



Nomura Researchrsquos Tushar Mohatarsquos call on Sunway Construction Group

Bhd

In a nutshell this is a winning call because the stock price ran shortly after

an upgrade to ldquobuyrdquo from ldquoholdrdquo But therersquos more depth than that

When Nomura Researchrsquos Tushar Mohata upgraded Sunway Construction

Group Bhd to ldquobuyrdquo on March 9 this year the share price rose 45 within

nine months to as high as RM241 on Dec 11 before retracing to RM238 on

Dec 15 Before the upgrade the stock price had largely been hovering

between RM150 and RM160 for about a year

His decision to upgrade Sunway Construction resulted from what he calls an

ldquoearnings-cash ow matrixrdquo as well as ldquothe law of diminishing returnsrdquo at a

time when most construction companies were already sitting on record-

sized order books A high base means small and medium-sized project

awards could mean very little incremental impact on future earnings and

share price



That came after he revisited Nomurarsquos investment thesis for the Malaysian

construction sector While net prot remains the best long-term predictor for

stock price returns he told clients that the cash conversion of reported

earnings was becoming equally important due to rising gearing in a weak

property market The latter was the reason Tushar preferred pure-play

Malaysian contractors like Sunway Construction to diversied contractors

with exposure to property development

According to him Sunway Constructionrsquos earnings ldquofairly accurately track its

actual cash ows reective of its healthy margins and timely collection from

customersrdquo Thatrsquos a better position than companies which may have good

reported earnings but subpar conversion of it to operating cash ow due to

reasons such as non-cash earnings stream and growing working capital

which leads to higher gearing (thus burdening the balance sheet)

A notable mention also goes to Macquarie Researchrsquos Aiman Mohamad who

has had a ldquobuyrdquo call on Sunway Construction since at least March 2016

according to Bloomberg data Both Nomura and Macquarie currently have

the streetrsquos most bullish target price of RM280



An Hwang Capital Researchrsquos Kevin Lowrsquos call on Inari Amertron Bhd

Inari Amertron saw its stock price more than double this year An Hwangrsquos

Kevin Low started coverage as early as April 23 2013 when the comparable

stock price was 16 sen

He continues to like Inari calling it a ldquopreferred pickrdquo for the local technology

sector due to its ldquosolid growth in the RF segment given new drivers

including the Osram IRIS IR chip and its data server chip business from

Broadcomrdquo Key downside risks to his recommendation include a slowdown

in global demand for smart devices rapid average sale price (ASP) erosion

loss of customer base and the introduction of new technologies that may

render Inarirsquos products obsolete

According to Bloomberg data there is currently one ldquofully valuedrdquo call from

DBS Vickers with a RM225 target price Six analysts have ldquoholdrdquo or ldquoneutralrdquo

calls on Inari while the remaining six (including Low) recommend as ldquobuyrdquo

Time will tell who will prove prescient this time next year



This year a notable mention also goes to Macquarie Researchrsquos Anand

Pathmakanthan as clients would have beneted from his upgrade from

ldquoneutralrdquo to ldquooutperformrdquo in January when the stock price was RM160

Similarly RHB Researchrsquos Kong Heng Siong upgraded his call to ldquobuyrdquo when

the stock price was RM190 on March 22 Credit Suissersquos Danny Chan who

started coverage with an ldquooutperformrdquo call on July 11 when the stock was at

RM213 apiece also deserves a notable mention

An Hwang Capital Researchrsquos Kevin Lowrsquos call on KESM Industries Bhd

When starting coverage on KESM Industries on Aug 15 2016 An Hwangrsquos

Kevin Low told clients the company was a good proxy for the stable and

growing automotive semiconductor segment going by growing demand for

electronics for vehicles from safety to infotainment and autonomous

vehicles In just four months the stock has gained 34 mdash making him a

winner last year

He continues his winning ways this year at RM1950 on Dec 15 KESM shares

had doubled from the start of the year mdash and therersquos still upside if Lowrsquos

RM2180 target price is to be believed In fact KESM reached as high as

RM2050 intraday on Nov 23 before closing at RM2040



ldquoWe favour KESM for its exposure to the automotive space an area we

believe will continue to benet from structural growth underpinned by

increased semiconductor content in automobiles as well as growth in

demand for hybrid and autonomous vehiclesrdquo Low wrote in a Dec 18 note

reiterating his ldquobuyrdquo call

In an earlier note dated Nov 24 he told clients that KESMrsquos revenue and

earnings momentum ldquoremained strongrdquo underpinned by aggressive capital

expenditure into the automotive burn and test business He also noted that

1QFY72018 net prot would have been stronger if not for higher eective tax

rate of 155 versus 104 in 1QFY72017 Key downside risks include a loss of

customers and a reduction in the outsourcing opportunities as customers

increase their in-house burn-in and test function he says

Two other analysts have since started coverage on KESM this year according

to Bloomberg data CIMB Research has an ldquoaddrdquo rating and RM22 target price

while Kenanga Research is going against consensus with an ldquounderperformrdquo

call and RM1840 target price which is below open market prices It would be

interesting to see if Low will make it a hat trick next year

KAF Seagroatt amp Campbell Securitiesrsquo Mak Hoy Kenrsquos call on Econpile

Holdings Bhd



Econpile Holdings shares have gained as much as 776 this year closing at

RM3195 on Dec 4 Even measured from this yearrsquos cut-o date of Dec 15

gains came to an enviable 73

In a Dec 29 note last year KAFrsquos Mak Hoy Ken retained his ldquobuyrdquo call He sees

Econpile as the research housersquos ldquotop small-cap construction pick for its

burgeoning order book sustained job momentum and attractive marginsrdquo

The civil engineering contractorrsquos market capitalisation breached RM1 billion

in late October 2016

Back then he also told clients that more strategic opportunities could stem

from Econpilersquos 6040 tie-up with China Communications Construction Co

(M) Sdn Bhd (CCCC) for a substructure and ancillary works package for

SUKE highway as it was a strong endorsement of Econpilersquos position as a

piling specialist in Malaysia

At the time of writing Makrsquos target price of RM333 implies only 7 upside

potential from RM311 on Dec 15 It remains to be seen just how much comfort

should be drawn from his Oct 20 note where he said Econpilersquos earnings

visibility ldquoremains solid backed by a healthy outstanding order book of

RM12 billion or around 21 times its construction revenuerdquo

Meanwhile Macquarie Researchrsquos Aiman Mohamad who started coverage

with an ldquooutperformrdquo call on Feb 23 this year when the stock price was at

RM207 apiece also deserves a notable mention with Econpile shares up

502 to RM311 apiece in about 10 months Macquarie has a RM350 target

price



KAF Seagroatt amp Campbell Securitiesrsquo Mak Hoy Kenrsquos call on Ann Joo

Resources Bhd

With shares of Ann Joo Resources Bhd up 83 to RM380 as at Dec 15 this

year investors who bought the stock at the start of the year would be sitting

on good portfolio gains KAFrsquos Mak Hoy Ken maintained a ldquobuyrdquo on the stock

with a higher target price of RM242 (from RM238) on Jan 5 The stock

dipped to RM217 mdash its lowest this year mdash on Jan 3 At its peak it closed as

high as RM391 on Nov 9

Back then Ann Joorsquos share price had just gained 224 in 2016 and there were

doubts in the market on whether the stock would continue to perform

especially with the direction of international steel prices being mixed at best

Mak was held to his belief that there was more upside to Ann Joo Among

other things he argued that domestic steel prices would see support from

provisional safeguard duties on imported bars and wire rods With the

counter trading at only eight to 10 times forward earnings multiples he was

convinced it was a cheaper alternative play to the Malaysian infrastructure

supercycle There is also a potential lift from a continued recovery in Chinese

steel prices as capacity cuts in that country gathers pace Chinese steel prices

have been on a general upward trend this year as the countryrsquos supply-side

reforms took eect



A notable mention goes to Maybank Investment Bank Researchrsquos Lee Yen

Ling who upgraded her call for Ann Joo on Aug 16 2016 when the stock

price was at RM172

At the time of writing Maybankrsquos Lee has since downgraded her call to

ldquoholdrdquo with a RM385 target price while KAFrsquos Mak continues to call a ldquobuyrdquo

with a RM410 target price Watch this space

Kenanga Researchrsquos Desmond Chongrsquos call on Malaysian Pacic Industries

Bhd

It was almost as if he had a crystal ball When Kenanga Researchrsquos Desmond

Chong upgraded his call on Malaysian Pacic Industries (MPI) from ldquomarket

performrdquo to ldquobuyrdquo on Jan 27 the stock price ran up 79 from RM797 to

RM14291 on Oct 11

Helping the gains were the better sales that MPI was seeing of its automotive

electronics and power management chips as well as improved eciency He

subsequently raised his target price three more times to as high as RM1570

on Aug 18

Thatrsquos not all When Chong turned cautious on its outlook and downgraded

MPI to ldquomarket performrdquo or a neutral stance on Nov 10 the stock price

retraced 12 fromRM1364 to RM12 on Dec 15



In a Nov 10 note issued following a brieng he highlighted the ldquomounting

pressure on marginsrdquo coupled with a potential setback from a longer

gestation period for its product rationalisation exercise

A special mention also goes to KAF Seagroatt amp Campbell Securitiesrsquo Shaq

Kadir and TA Securitiesrsquos Paul Yap who earlier had ldquobuyrdquo calls that also

proved right Kenangarsquos call got more points as MPI shares ran shortly after

his upgrade compared with the two existing ldquobuyrdquo calls

All three currently have ldquoholdrdquo calls on MPI in line with consensus At the

time of writing An Hwang Capital Research had the only ldquosellrdquo on the

stock with a target price of RM12 according to Bloomberg data Will he have

the last laugh next year

UOB Kay Hian Researchrsquos Ridhwan Eendyrsquos call on Kerjaya Prospek Group

Bhd



Investors who made money might recall that UOB Kay Hianrsquos retail research

team started coverage on Kerjaya Prospek as far back as January 2016 when

it was still called Fututech Bhd The team called the stock ldquoan upcoming mid-

cap construction companyrdquo that would emerge as an end-to-end building

contractor with RM27 billion order book after completing the acquisition of

two privately-run construction companies

At the time the (adjusted) stock price was RM169 As at Dec 15 it had gained

134 to RM397 although that is o as high as RM408 on Nov 3 This year

alone Kerjaya shares were up 83 at the time of writing

On Jan 3 UOBrsquos Ridhwan Eendy told clients that 2017 would continue to be

an eventful year for Kerjaya mdash which stands out as a potential capital

management play mdash given its strong cash pile of RM107 million or 10 of its

market capitalisation back then

According to Bloomberg data at the time of writing UOB is the only house

still calling a ldquobuyrdquo on Kerjaya while the remaining two houses with active

coverage have ldquoneutralrdquo or ldquounderperformrdquo The ldquounderperformrdquo call made

in early August when the share price was RM354 but the stock is at RM397

currently

UOB upgraded the stock to ldquobuyrdquo again on Nov 23 with a higher target price

of RM453 (from RM381) after raising its earnings estimates as well as order

book win assumptions Ridhwan continues to like Kerjaya for its superior

margins high order book cover net cash of RM163 million (289 sen per

share) and ability to clinch new contracts



UOB Kay Hian Researchrsquos Ridhwan Eendyrsquos call on Sunsuria Bhd

UOB Kay Hian was the rst house to initiate coverage on Sunsuria nearly

three years ago At the time the headline recommendation was ldquoholdrdquo based

on a 50 discount to its sum-of-parts valuation

Nonetheless the research house told clients that it expected the company to

take on a major asset acquisition strategy ldquoInvestors with the risk appetite

for small-caps should consider re-entering ahead of the announcement

which is expected to be in 1Q2015rdquo it said in a brief note dated Feb 18 2015

That gives this submission an edge over others Based on where the stock is

today post the corporate developments the equivalent (adjusted) stock price

would be 868 sen A simplistic measurement would show a 786 gain at its

recent peak of RM155 on July 14 2017

UOB Kay Hianrsquos Ridhwan Eendy raised his target price to RM125 (from

RM1) when reiterating a ldquobuyrdquo call on Jan 12 this year as he expected

Sunsuria to enter a multi-year growth phase Riding on the success of

Xiamen University Ridhwan expects its agship Sunsuria City development

to be a key driver for sales and earnings



Sunsuriarsquos stock price took only about a month to reach the new target price

and on Feb28 Ridhwan raised the target price to RM150 mdash which the stock

hit on April 10 before retracing to RM140-levels

On May 25 Ridhwan downgraded the stock to ldquoholdrdquo with an unchanged

target price after the release of the companyrsquos 2QFY2017 earnings telling

investors to ldquocapitalise on their gainsrdquo as he believed its near-term potential

had been reected after a 42 year-to-date climb

At the time the stock price was RM141 and the highest it went was a 99 rise

to a recent high of RM155 on July 17 before retracing to RM134 about 5

lower than at the point of downgrade

AmInvestment Bank Researchrsquos Alex Gohrsquos call on Petronas Gas Bhd

AmInvestment Bankrsquos Alex Goh got it right when he cut Petronas Gas to ldquosellrdquo

from ldquoholdrdquo on Nov 18 with a RM1665 target price while the stock was

trading at RM20-levels

From there the price skidded 22 to as low as RM1588 on Nov 30 The

magnitude of the fall is considerably sharp given that Petronas Gas is a big-

cap counter with a market capitalisation of RM336 billion

In fact between Nov 18 last year and the recent low on Nov 30 it lost a

whopping RM101 billion in market capitalisation



When downgrading his call more than a year ago Goh told clients about the

chances of impending earnings erosion given the Energy Commissionrsquos

upcoming plan to implement incentive-based regulation (IBR) taris on the

grouprsquos gas transport tari That made it hard to justify the companyrsquos

valuation and share price of above RM20

On Dec 5 Goh seemed to have also rightly upgraded Petronas Gas to a ldquoholdrdquo

with a RM1665 target price when the share price was at RM1610 Closing at

RM1696 on Dec 21 the stock had gained 53

Meanwhile it is worth noting that TA Securitiesrsquo analyst Kylie Chan also had a

ldquosellrdquo call on the stock according to Bloomberg data when many others on

the street still said ldquoholdrdquo

Inter-Pacic Securities Researchrsquos Wong Ling Lingrsquos call on Uchi

Technologies Bhd



2017 has been a spectacular year for Uchi Technology as was Inter-Pacic

Securities Researchrsquos Wong Ling Lingrsquos ldquobuyrdquo call on the company

The companyrsquos share price had gained between 13 and 30 a year between

2012 and 2016 and this year was beginning to look that way as well until a

sharp rally occurred from the middle of the year barely a fortnight from the

time she started coverage on the stock with a ldquobuyrdquo call

Uchirsquos performance likely surprised even her

Only three analysts are actively tracking Uchi according to Bloomberg data

When Wong started coverage on June 15 Uchi shares were at RM184 a share

From there it rocketed 93 in just over ve months to RM355 on Nov 29

At RM345 on Dec 15 Uchirsquos market capitalisation stood at RM157 billion

compared with about RM800 million just six months earlier

Wongrsquos ldquobuyrdquo recommendation was premised on the companyrsquos stable

earnings growth unique business model a minimum dividend payout ratio

of 70 of prot after tax very comfortable prot margins and a clientele

comprised of industry market leaders It would be interesting to see if Uchi

which specialises in the design of electronic control systems for a number of

multinational companies that are global leaders in their respective industries

can continue to surprise on the upside next year



Hong Leong Investment Bank Researchrsquos Jeremy Gohrsquos call on George Kent

(M) Bhd

This time last year HLIB Researchrsquos Jeremy Goh was the only analyst

actively tracking George Kent telling clients that the water meter-turned-

engineering company had RM51 billion engineering order book and ldquocan no

longer be ignoredrdquo

Today he is one of three analysts calling a ldquobuyrdquo on the company he

described as one with 68 sen per share net cash and a ldquokey rail play with

exposure to the LRT extensionsrdquo His target price is currently RM390 Closing

at RM362 on Dec 15 George Kent shares had gained 83 year to date

continuing its ascent from the year before

In a Dec 7 note after the companyrsquos third quarter earnings brieng Goh noted

that George Kent mdash which is the leader for water meters in Malaysia with

over a 50 market share mdash could see the opening of ldquoa whole new marketrdquo

for itself when it commercialises its automated meter reading (AMR)



product which allows remote reading of water meters Selangor is expected

to call tenders for AMR meters in two months for a pilot project while Johor

and Penang are also looking to replace traditional meters Goh said

The company (via a joint venture with Siemens) is also preparing to put in a

bid for the Kuala Lumpur-Singapore high-speed rail (HSR) asset company

(AssetsCo) that will help develop key parts of the project That may provide

further catalysts for the stock next year

UOB Kay Hian Researchrsquos Kong Ho Mengrsquos call on Sapura Energy Bhd

When analysts rushed to revise their ldquobuyrdquo and ldquoneutralrdquo calls on Sapura

Energy Bhd in early December after a large quarterly net loss UOB Kay Hian

Researchrsquos Kong Ho Meng stood out as he had had a ldquosellrdquo call for close to six

months

The stock tumbled 20 in a single day on Dec 7 after the group announced a

quarterly net loss of RM2744 million for the third quarter ended Oct 31 a

sharp contrast to a net prot of RM158 million the year before

Looking back we see that the share price had in fact been drifting lower

since mid-June when the consensus view was that the oil



and gas giant was in calmer waters as the recovery of global crude oil prices

gathered steam

Kongrsquos timely downgrade of his call from ldquoneutralrdquo to ldquosellrdquo on June 20 would

have saved clients from sizeable portfolio losses From RM167 the stock

price tumbled 53 to 785 sen at our award evaluation cut-o date of Dec 15

When The Edge went to print the stock price had slid further to a record low

of 715 sen on Dec 21

A notable mention goes to Credit Suissersquos Danny Chan who also went against

the grain with a contrarian ldquosellrdquo call since June although he prematurely

upped his recommendation to ldquoneutralrdquo while the counter was still heading

south

An Hwang Capital Researchrsquos Ng Chi Hoongrsquos call on Jaks Resources Bhd



Jaks Resources is not well tracked by analysts many of whom may feel the

need to observe the company from the sidelines for the time being since its

power generation project in Vietnam will only start contributing in 2020 and

be a good source of recurring income

The lack of coverage makes An Hwang Capitalrsquos Ng Chi Hoongrsquos ldquobuyrdquo

recommendation and analysis stand out even more Those familiar with the

company would know Jaks is undertaking a US$187 billion 1200MW coal-

red thermal power plant project near Hai Duong together with China Power

Engineering Consulting Group Co Ltd (CPECC) Jaks holds a 30 stake in the

joint venture and CPECC the remaining 70

In a Jan 4 note Ng raised his target price for Jaks to RM2 (from RM160)

following a review of its assets after the company said it was realigning its

focus on Vietnam given the slowdown in the property market in Malaysia

At the time Jaksrsquo share price was at RM101 It took barely three months to

jump 70 to reach RM172 on April 5 before retracing

Following the strong rally Ng downgraded his call to ldquoholdrdquo on May 25 when

the price was RM158 When it skidded to RM138 on Oct 17 however he saw

reason to upgrade to ldquobuyrdquo again with RM175 target price Jaks closed at

RM150 as at Dec 20 up 485 from the time Ng reiterated his ldquobuyrdquo call with

a higher target price



A special mention goes to Anrsquos Lim Yee Tang who initiated coverage on

Jaks before he moved to equity sales Ng assumed coverage from November

2016

Kenanga Researchrsquos Raymond Choorsquos call on Hartalega Holdings Bhd

At the start of 2017 Kenanga Investment Researchrsquos Raymond Choo boldly

recommended that clients buy Hartalega Holdings shares He was the only

one of 20 analysts tracking the stock to do so according to Bloomberg data

In fact there was as many as ve ldquosellrdquo calls

The lack of enthusiasm may have stemmed from the fact that Hartalega

shares were down 17 year on year in 2016 after gaining 72 y-o-y in 2015 A

long-time favourite of investors the leading nitrile glove maker sprang a

surprise rebound this year rising more than120

The stock moved from RM476 as at end-2016 to RM975 on Dec 15 our award

evaluation cut-o date As at Dec 20 the stock price reached RM1140



Investors who bought shares early this year would have Choo to thank His

contrarian stance stemmed from the conviction that Hartalega was

capitalising on its new capacity from the NGC plant in Sepang on the back of

robust demand and a slower-than-expected production ramp-up in the other

rubber glove players

He was convinced by Hartalegarsquos constant desire to move up the value chain

by oering superior product innovation and automating its production

processes Hartalegarsquos recently announced rst non-leaching antimicrobial

nitrile examination glove is also expected to be a game changer in the rubber

glove industry

Inter-Pacic Securitiesrsquo David Lai Yoon Hui also deserves a notable mention

for also having a ldquobuyrdquo for the most part save for a blip in May

MIDF Researchrsquos Ng Bei Shanrsquos call on Superlon Holdings Bhd



At its peak Superlon Holdings Bhdrsquos market capitalisation reached RM4637

million when its share price rose to RM292 on Sept 18

While some institutional investors may consider this small the market cap is

already more than double the RM20247 million the company was valued at

on Nov 22 last year mdash the day MIDF Researchrsquos Ng Bei Shan initiated

coverage on the maker of synthetic rubber insulators used mainly for

heating ventilation air conditioning (HVAC) and refrigeration mdash which are

important for high-rise buildings and industrial use The recommendation

was based on the prospects for its new warehouse which would improve

lead time and sales market dominance and its sturdy balance sheet

(RM3913 million net cash) that spelt dividend payments

In fact MIDF had been watching Superlon for some months starting with a

non-rated report in March 2016 when its market cap stood at RM1596

million

Measured from Nov 21 2016 the share price appreciated as much as 137 to

reach RM292 on Sept 11 this year Part of the gains were thanks to a share

split that the company had hoped would improve liquidity mdash a move that was

rewarded with the entry of institutional investors including the emergence

of Kumpulan Wang Persaraan (Diperbadankan) as a substantial shareholder

with a 1049 stake

Closing at RM215 on Dec 15 the counter had skidded 26 from its recent

peak but it remains about 75 above the time MIDF started calling a ldquobuyrdquo

Ng who had downgraded the stock to ldquoneutralrdquo on Sept 27 when her target



price was nearly met and its 1QFY2018 earnings were hit by a spike in raw

material price upgraded her call again to ldquobuyrdquo on Dec 15 following the share

price weakness At the time of writing its RM236 target price implies 98

upside potential from current levels

An Hwang Capital Researchrsquos Tan Jian Yuanrsquos call on Serba Dinamik

Holdings Bhd

If you had bought Serba Dinamik Holdings Bhd shares when An Hwang

Researchrsquos Tan Jian Yuan started coverage with a ldquobuyrdquo and RM240 target

price you would have seen your holdings rise 677 over seven months from

RM176 to RM322 on Dec 15

Thatrsquos if you did not get the initial public oering (IPO) shares for Serba

Dinamik which made a strong debut on the Main Market on Feb 8 this year

and went on to become the yearrsquos best-performing IPO with a gain of 119 as

at Dec 15 Kenanga Investment Bank was the IPO lead manager



This article rst appeared in Capital The Edge Malaysia Weekly on December 25 2017 - December

31 2017

PICKINGS were better this year with several stocks performing much better

than expected mdash surprising even the analysts some of whom were rewarded

for choosing to retain a ldquobuyrdquo call against consensus

After three straight years of annual declines at the FBM KLCI (something that

has only happened once in the past four decades) the bellwether index mdash

which rose by as much as 94 to 179675 points on June 16 mdash closed at

174663 points on Dec 20 mdash up 64 from the start of the year The broader

FBM Emas Index meanwhile was 976 higher year to date at 1258559

points last Wednesday

The winners in the 12th edition of The Edgersquos Best Call Awards for 2017 were

selected from 90 recommendations for 66 stocks received from 16 research

houses

Last year we received 86 nominations for 75 stocks from 14 outts Most

nominations were from heads of research and the analysts themselves

others being fund managers and other analysts for their fellow colleagues

The winners include those who rightly stuck their neck out by calling an

outright ldquosellrdquo (instead of just whispering it to clients) and were proved right

We were tempted to include more names as there were several other good

calls but we decided to stop at 17 for 2017

Like last year we made some allowances for calls made in 2016 that proved

right in 2017 This yearrsquos list of 17 winners are our best-eort attempt to

recognise good fundamental stock analysis and its importance in making

investment decisions based on submissions and publicly available data






recommendations






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share price




















































winner last year

























Holdings Bhd

























price




Resources Bhd


















reforms took eect





price was at RM172





Bhd




RM14291 on Oct 11




on Aug 18


















Bhd




















currently




























































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd














recommendations






Bhd






































Bhd













share price




















































winner last year

























Holdings Bhd

























price




Resources Bhd


















reforms took eect





price was at RM172





Bhd




RM14291 on Oct 11




on Aug 18


















Bhd




















currently




























































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd




































Bhd













share price




















































winner last year

























Holdings Bhd

























price




Resources Bhd


















reforms took eect





price was at RM172





Bhd




RM14291 on Oct 11




on Aug 18


















Bhd




















currently




























































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd












Bhd













share price




















































winner last year

























Holdings Bhd

























price




Resources Bhd


















reforms took eect





price was at RM172





Bhd




RM14291 on Oct 11




on Aug 18


















Bhd




















currently




























































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd




























































winner last year

























Holdings Bhd

























price




Resources Bhd


















reforms took eect





price was at RM172





Bhd




RM14291 on Oct 11




on Aug 18


















Bhd




















currently




























































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd









































winner last year

























Holdings Bhd

























price




Resources Bhd


















reforms took eect





price was at RM172





Bhd




RM14291 on Oct 11




on Aug 18


















Bhd




















currently




























































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd
























winner last year

























Holdings Bhd

























price




Resources Bhd


















reforms took eect





price was at RM172





Bhd




RM14291 on Oct 11




on Aug 18


















Bhd




















currently




























































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd





























Holdings Bhd

























price




Resources Bhd


















reforms took eect





price was at RM172





Bhd




RM14291 on Oct 11




on Aug 18


















Bhd




















currently




























































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd

































price




Resources Bhd


















reforms took eect





price was at RM172





Bhd




RM14291 on Oct 11




on Aug 18


















Bhd




















currently




























































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd












Resources Bhd


















reforms took eect





price was at RM172





Bhd




RM14291 on Oct 11




on Aug 18


















Bhd




















currently




























































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd













price was at RM172





Bhd




RM14291 on Oct 11




on Aug 18


















Bhd




















currently




























































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd























Bhd




















currently




























































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd




























currently




























































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd































































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd












































Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd























Technologies Bhd

























(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd

































(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd












(M) Bhd



























months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd






















months









gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd












gathered steam









south




























2016























glove industry



















million






with a 1049 stake











Holdings Bhd



































2016























glove industry



















million






with a 1049 stake











Holdings Bhd













2016























glove industry



















million






with a 1049 stake











Holdings Bhd




















glove industry



















million






with a 1049 stake











Holdings Bhd
























million






with a 1049 stake











Holdings Bhd
















Holdings Bhd









Documents

Capital: Th e Edge Best Call Awards - serbadinamik.comserbadinamik.com/wp-content/uploads/2018/01/18-Jan04-The-Edge...1/5/2018 Capital: The Edge Best Call Awards 2017 | The Edge Markets