Boustead Holdings Bhd (Technical Buy)

• BSTEAD trended inside an ascending price channel after rising from a low of RM0.52 in mid-Oct 2022, and is currently consolidating between RM0.60-RM0.615.
• Backed by DMI Plus crossing above DMI Minus and positive indicators of possible direction shift in RSI coupled with Chaikin Oscillator suggesting the easing of selling pressure, the stock could set to bounce off and steer away from the supporting level.
• Hence, the stock could rise to challenge our resistance levels of RM0.69 (R1; 10% upside potential) and RM0.75 (R2; 20% upside potential).
• We peg our stop loss at RM0.56, representing a downside risk of 10%.
• Business-wise, the Malaysian-based conglomerate has operations in five segments, namely: (i) plantation, (ii) property and industrial, (iii) heavy industries, (iv) pharmaceutical, and (v) trade financing and investment.
• Earnings-wise, the group recorded a net profit of RM99.6m (+79% QoQ) in 3QFY22, bringing its cumulative 9HFY22 net profit to RM464.3m (+407% YoY).

Datasonic Group Bhd (Technical Buy)

• DSONIC’s share price pulled back from its resistance level of RM0.54 in Nov 2022 and we expect the share price to continue to move in an upward trajectory.
• Following which, the share price will likely form a reversal trend backed by: (i) the Stochastic indicator in the midst of climbing out from the oversold zone, and (ii) it being on the verge of bouncing off from the lower Bollinger Band.
• Thus, we believe DSONIC’s share price could advance towards our resistance thresholds of RM0.515 (R1) and RM0.55 (R2), representing upside potentials of 11% and 18%, respectively.
• Our stop loss price is set at RM0.42 (or a downside risk of 10%).
• DSONIC provides ICT solutions that include smart card personalization such as secure ID or chip-based credit/debit bank cards.
• The group reported a 2QFY22 net profit of RM24.9m (+236% QoQ), bringing its 1HFY22 cumulative net profit to RM36.9m (vs. net loss of RM4.6m last year).
• The consensus is projecting DSONIC to report net profits of RM75.5m in FYE March 2023 and RM89.3m in FYE March 2024, which translate to forward PERs of 17.2x and 15.0x, respectively.

Source: Kenanga Research - 30 Dec 2022