• Opportunities amid selldown. Since our take profit call on 21 May at RM2.59, Unisem’s share prices corrected 13.9% (in tandem with the broader market consolidation and selling pressures by ESOS and conversion of warrants) to a low of RM2.23 on 16 June before closing at RM2.32 yesterday. HLIB maintains a BUY rating on Unisem with an institutional target price of RM2.82, or 21.6% upside, supported by robust 49% EPS CAGR from FY14-16 and decent yields of 4.2%-5.4% for FY15-16.
• Potential resumption of uptrend amid Tweezers bottom pattern. The “Tweezers Bottom” candlesticks on daily charts coupled with bottoming up indicators suggest potential reversal of downtrend. Immediate resistances are RM2.40 (50-h SMA) and RM2.47 (support-turned-resistance trendline). A swift recapture above RM2.47 again will spur prices to retest 52-week high of RM2.65 (21 Apr high).
• Key supports are RM2.23 (29 Apr and 16 Apr low) and RM2.20 (hourly lower Bollinger band). Cut loss at RM2.16 (2sen below Unisem-WA strike price).

Source: Hong Leong Investment Bank Research - 18 Jun 2015