• LCTH Corporation Berhad, through its subsidiaries , is engaged in manufacturing and assembling precision plastic parts and components. Based on its FY14 annual report, 49.6% of total operating income was derived from export market. Hence, LCTH is a beneficiary of strengthening USD.
• LCTH’s s hare price is likely to gain buying momentum in near term after taking a breathier from the peak of RM0.705 on 24 July 2015 to the low of RM0.535 on 1 Sep 2015 as the recent pullback has ended when price moved back above the Base Line, triggering buy signal. Moreover, share price has been riding on long-term uptrend line as well as above the Ichimoku Cloud.
• Coupled with “Flag” pattern breakout on weekly chart, we are looking at target prices of RM0.705, RM0.73 and RM0.78 (measurement objective of Flag breakout). Supports are pegged at RM0.635 (10-d SMA) and RM0.62, with cut loss at RM0.61.

Source: Hong Leong Investment Bank Research - 5 Oct 2015