Highlights

HLBank Research Highlights

Author: HLInvest   |   Latest post: Tue, 20 Oct 2020, 9:49 AM

 

Retail Strategy - Budget 2020 stimuli to drive 4Q interest

Author:   |    Publish date:


Budget 2020 as main trading catalysts for 4Q. On the back of improving optimism on trade war (amid the phase-1 deal between US and China), coupled with less austerity sounding Budget 2020 which market participants felt the change of tone vs. Budget 2019, we opine traders to lookout for sectors such as:- (i) Technology (automation, E&E and customized packaged investment incentives as well as weak ringgit ranging ~RM4.18/USD) (ii) Renewable energy (green investments tax allowance) (iii) Telecommunication (ongoing National Fiberisation and Connectivity Plan (NFCP initiatives) (iv) Construction (increased development expenditure by 2.4% YoY) (v) Tourism (to boost tourist arrivals to 30 million)

Time to scoop up some equities. In 4Q, we opine the slightly positive sounding Budget 2020 as well as window dressing in December (average 10-year December return: 1.98%) would be able to lift the broader market sentiment (although some earnings disappointment may surface in November). In addition, the earlier mentioned catalysts would bode well for stocks selections in 4Q.

Technology: We believe the broad technology sector will be benefiting under the E&E and automation incentives, which could result in higher demand for automation equipment moving forward; under this section we like ISTONE and KESM.

Power-related: With the increasing demand for rural electrification in Malaysia, PESTECH would be the favoured pick amid its power transmission infrastructure expertise. Meanwhile, for renewable energy stimulus, we like CYPARK.

Construction: Given the increase in development expenditure and potentially improving construction sector, we see precast concrete manufacturers such as OKA and KIMLUN to benefit from the initial stage of construction jobs.

Tourism: Under the Budget 2020, RM1.1bn was allocated for VMY2020, which the government intends to achieve 30m tourist arrivals. In this space, we like TUNEPRO for the Travel Insurance Play, Which Is a Proxy Towards Tourism Industry.

 

Source: Hong Leong Investment Bank Research - 23 Oct 2019

Share this

Related Stocks

Chart Stock Name Last Change Volume 
ISTONE 0.215 0.00 (0.00%)
KESM 8.90 0.00 (0.00%)
PESTECH 0.73 0.00 (0.00%)
CYPARK 0.875 0.00 (0.00%)
KIMLUN 0.735 0.00 (0.00%)
OKA 0.605 0.00 (0.00%)
TUNEPRO 0.315 0.00 (0.00%)

  Be the first to like this.
 


APPS
I3 Messenger
Individual or Group chat with anyone on I3investor
MQ Trader
View candlestick stock charts with Technical indicators
MQ Affiliate
Be rewarded by being an MQ Affiliate
 
 

2150 

ActiveGainersLosers
Top 10 Active Counters
 NameLastChange 
 SCOMNET 2.260.00 
 KOTRA 3.360.00 
 UCREST 0.1450.00 
 GENM-C73 0.0050.00 
 PUC 0.240.00 
 WILLOW 0.4350.00 
 EAH-WE 0.0150.00 
 IRIS 0.260.00 
 TOPGLOV-C79 0.520.00 
 BTECH 0.500.00 

FEATURED POSTS

1. The Equity Market Index Benchmark in Malaysia CMS
2. Trading Scenarios of Derivatives Bursa Derivatives Education Series
3. Derivatives 101 Bursa Derivatives Education Series
4. Why Trade FKLI? Bursa Derivatives Education Series
5. MQ Trader - Introduction to MQ Trader Affiliate Program MQ Trader Announcement!

TOP ARTICLES

1. Mah Sing: buyers be forewarned - Koon Yew Yin Koon Yew Yin's Blog
2. SUPERMAX - BEYOND GLOVES !!! freetospeak
3. LUSTER - IS IT ANOTHER GLOVE TITAN? HIDDEN WINNER(S) OF PHARMACEUTICAL DEMAND PENT UP
4. IT'S A TIME FOR THIS GLOVES GOING TO SKYROCKET!!! Follow Kim's Stockwatch!
5. PublicInvest Research Daily - 19 October 2020 PublicInvest Research
6. Covid 19 cases in Malaysia - Koon Yew Yin Koon Yew Yin's Blog
7. SUPERMAX OBM - The George Soros bet AGAIN? (REVISIT) freetospeak
8. Greatec: do not buy it - Koon Yew Yin Koon Yew Yin's Blog
PARTNERS & BROKERS