MAHB (Hold; TP: RM6.08)

Growth In Line

'''' 2QFY11 results in line with HLIB and consensus, in view of seasonally strong 2H.

'''' Started recognizing airport construction revenue but imputed zero profit.

'''' Strong passenger traffic growth of 12.6% yoy (low cost carrier +18.3%) in 2Q11.

'''' Another RM30m airlines rebate in 2Q11 (1H11 RM60m) but expected lower amount in 2H11.

'''' Turkey associate continued to make losses (only expected to become profitable by 2015) but partly offset by profits from Maldives associate.

'''' RM800m already spent on KLIA2, another RM700m and RM1bn more in 2011 and 2012 respectively.

'''' Management confident of securing Madinah airport concession.

'''' Forecasts unchanged.

'''' Maintain Hold and DCF based target price of RM6.08.

''

IOI Corporation (Hold; TP: RM5.41)

Acquiring land in Sabah

'''' IOI proposed to acquire 11,977.9ha of oil palm plantation land in Labuk and Sugut, Sabah for RM830m (translating to an average price of RM69,294/ha).

'''' It will raise IOI's net debt and net gearing to RM2.6bn and 0.19x from RM1.8bn and 0.15x as at 31 Mar 2011.

'''' Based on our estimates, the acquisition would enhance IOI's net profit by RM9m p.a. (or''less than 1% of its total net profit).

'''' Positive due to close proximity of the acquired estates to existing estates (enhance economies of scale) and IOI's expertise and experience in improving yield.

'''' Earnings forecasts, SOP-derived TP (RM5.41), and Hold recommendation maintained for now, pending further update from management.

''

WCT (BUY)

RM115m Vale order

'''' WCT has been awarded an earthworks services contract by Vale for its iron ore distribution centre and pelletising plant in Teluk Rubiah, Manjung, for RM115m. The contract is expected to be completed by April'13.

'''' This order marks WCT's first major contract win for the year, bringing its outstanding order book to ~RM2.9bn, translating to 1.9x FY10's revenue and 1.2x market cap.

'''' Maintain BUY with TP of RM3.85 on positive outlook for the sector as we expect more orders to materialise under the ETP and is the cheaper large cap construction stock compared to IJM and Gamuda.

''

FBM KLCI - Volatility to continue

'''' The hammer formation yesterday could be a positive reversal signal as it appears that the index is trying to form a base near 100-d SMA. If prices can hold on above this level for the next few days, there is a good chance that it may charge towards upside resistance at 50-d (1562) and 30-d (1571) SMAs.

'''' However, if the 100-d SMA is broken, selling pressures will intensify and index will head towards 1536 (50% FR) and 1529 (200-d SMA) zones.

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Stock to watch - Genting Singapore:

Further technical rebound with recent strong breakout and bullish indicators

'''' The bulls are gaining momentum following its recent strong breakout above the short term downtrend line (from May). Immediate upside targets are S$2.05-2.30 whilst supports fall on S$1.80-1.90. Trading Buy but stop loss below S$1.80

''