*Maybank Kim Eng Kopi-O (1 Dec 2021)*
Nikkei 27821.8 -1.63%
Kospi 2839.0 -2.42%
SSE 3563.9 0.03%
HSI 23475.3 -1.58%
TWSE 17427.8 0.58%
SET 1568.7 -1.32%
JCI 6533.9 -1.13%
STI 3041.3 -2.54%
KLCI 1514.0 0.23%
*MKE Key Calls*
*RHB Bank - 3Q21 results above expectations*
RHB’s 3Q21 results were above expectations - we revise FY21/22E net profit by +15%/-8%. The group’s strong CET1 ratio of 16.8% (15.7% at the bank level) paves the way for potentially better dividend payouts moving forward. BUY maintained with a lower TP of MYR6.00 (-30sen), pegged to a lower CY22 PBV of 0.8x (ROE: 7.9%) from 0.9x previously.
*MY*
o Expect market to be choppy after the selloff in overnight Wall Street. Sentiment will remain subdued over worries on Omicron. Locally, glove makers may remain in the limelight while commodity stocks, particularly O&G counters, are expected to take a hit after crude oil price tanked. Technically, we expect the benchmark index to range between 1,500 and 1,530, with supports at 1,515 and 1,500.
o *Axiata Group (AXIATA MK)*: Edotco’s proposed acquisition of a state-affiliated tower-co in Malaysia represents the third material transaction for Axiata in 2021. Deal multiples were not disclosed, but should have incorporated some scarcity and growth elements, in our view. Reiterate BUY with an unchanged MYR4.50 TP (based on a SOP). Axiata remains on track for a multi-year earnings recovery.
o *Kelington (KGRB MK)*: Reported a 62% YoY and 8% QoQ jump in 3Q21 PATMI, lifting 9M21 net profit to MYR20.9m (+118% YoY). Excluding one offs, its 9M21 core net profit rose 92% YoY to MYR20m. The stronger 9M21 results were contributed by higher revenue contribution across all business segments. With 9M21 results already exceeded FY20 net profit, KGRB is on track to end the year stronger. Its outstanding order book stood at MYR932m as at Nov 2021, about 2.4x its FY20 revenue. Stock trades at 26.4x consensus FY22 EPS. It is sitting on a net cash of about MYR50.1m at end-Sep 2021.
o *Jaks Resources (JAK MK)*: Jaks Resources’ 3Q21 PAT grew 19% YoY to MYR31.9m, which brought 9M21 PAT to MYR80.4m (+254% YoY). The stronger 9M21 results stemmed from the MYR110.7m contribution from its 30%-owned joint venture, the JAKS Hai Duong Power Plant. This more than offset its loss making construction and property development businesses. With this set of results, the group is on track for a turnaround in FY21. Stock is trading at 9.2x FY22 consensus EPS.
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