• Business profile. ML Global Berhad, through its subsidiaries, constructs commercial and residential buildings and operates as contractor for plumping and sanitary engineering works .

• In the midst of uptrend development. Based on weekly chart, the stock is trading above all SMAs, especially 200-week Simple Moving Average for the first time in more than 10 years . Going forward, we believe that the trend of the stock is likely to move in upward trajectory in tandem with increasing trading volume.

• Recent rally in share price following the retracement suggests higher likelihood of resumption of uptrend based on daily chart. Noticeably, both daily and weekly oscillators (MACD, RSI & Stochastics) show that the upward momentum remains intact. Hence, we are targeting RM0.66 and RM0.70, with a long-term objective of RM0.73 (measurement objective of Flat pattern). Immediate supports are pegged at RM0.605 and RM0.59. Cut loss below RM0.58.

• Attractive risk to reward ratio with 17.7% upside against 6.4% downside. We see a good risk to reward ratio for investor with a theoretical entry price of RM0.62 given that the downside to the cut loss zone of RM0.58 is 4 sen (-6.4%) while the upside to the LT target of RM0.73 is 11 sen (+17.7%).

Source: Hong Leong Investment Bank Research - 18 May 2016