• HLIB maintains a BUY rating on TNLOGIS with a SOP target price o RM2.07, or 29.4% upside. We like TNLOGIS owing to its logistics and warehousing division that will continue to anchor the group’s growth in the coming years with e-commerce and resilient increase in B2B trade volume. Meanwhile, the expectation of REIT listing of warehouse assets (likely to defer to 2H17) together with potential special dividend post IPO will bring about an asset rerating.

• While admittedly outlook of the property market is still subdued, the group still owns undeveloped landbank with the size of 152.7 acres (potentia GDV of circa RM1.5bn), an upside catalyst as we have yet to account fo the potential new launches. Moreover, the focus of TNSLOGIC is on industrial property development which is more resilient amid curren subdued property market.

• Upside bias towards RM1.76-1.80 zones following a bullish downtrend line breakout. TNLOGIS is ripe for further rebound following the formation of Tweezers bottoms and positive downtrend resistance breakout last Friday, supported by bottoming up indicators.

• A decisive breakout above RM1.65 (50% FR) will spur prices highe towards RM1.76 (52-week high) before reaching our LT objective a RM1.86 (138.2% FR). Key supports are situated near RM1.54 (Tweezers bottom) and RM1.51 (200-d SMA). Cut loss at RM1.49.

Source: Hong Leong Investment Bank Research - 16 Jan 2017