*Maybank IBG Kopi-O (16 Feb 2022)*
Nikkei 26865.2 -0.79%
Kospi 2676.5 -1.03%
SSE 3446.1 0.50%
HSI 24355.7 -0.82%
TWSE 17951.8 -0.25%
SET 1701.5 0.99%
JCI 6807.5 1.08%
STI 3421.4 0.01%
KLCI 1599.6 1.00%
*MY*
o The rally in overnight US markets should help lift the KLCI above the 1,600 level today. Hopes of easing geopolitical tensions will also lend support to sentiment. That said, O&G stocks may take a breather after commodity prices fall. Technically, we expect the benchmark index to range between 1,580pts and 1,630pts today, with supports at 1,570 and 1,530.
o *Dialog Group (DLG MK)*: We expect a stronger 2H22 vs. 1H22 (42% of our FY estimate), as its new 85k m3 capacity at its DTL3 (Tj. Langsat) ops kicks in from end-2021. Its tank terminal operations remain its core earnings contributor and developing Pengerang to its full potential remains its key agenda, a long-term project lasting 10-15 years. Our SOP-based TP of MYR4.90 is unchanged. Maintain BUY.
o *Sime Darby Plantation (SDPL MK)*: MYR82m was set aside to reimburse hidden recruitment fees to foreign workers. This one-off compensation sum represents 3.8% of our FY21’s headline PATMI. This is a step in the right direction and shows SDPL’s commitment to address lapses in past recruitment practices as well as instituting necessary changes to prevent a recurrence in the future. Pending its upcoming results release, we are keeping our EPS forecasts. Our BUY and RNAV-TP of MYR4.47 are under review given recent share price outperformance.
o *Duopharma Biotech (DBB MK)*: Reported a net profit of MYR15.7m (-3% YoY, -7% QoQ) in 4Q21, lifting full-year net profit to MYR65.7m (+12%). The stronger FY21 results stemmed mainly from a 12% increase in revenue and a lower effective tax rate. DBB also declared a second interim dividend of 1.8sen/sh for the current quarter. Management highlighted that several developments will bolster its future earnings. Stock trades at 17.4x consensus FY22 EPS.
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