Eco World International Bhd (Technical Buy)

• EWINT’s share price has surged 173% from a low of RM0.245 in October 2022 to a high of RM0.67 last Monday beforeretracing to close at RM0.62 last Friday. With the share price currently hovering near the lower end of the channel and thechart forming higher highs, we believe that the share price will continue its upward trend.

• Chart-wise, we believe the share price will show an upward bias ahead, supported by a bullish RSI signal and the DMI Plusbeing above the DMI Minus.

• Hence, we expect EWINT’s share price will rise to challenge our resistance levels of RM0.69 (R1; 11% upside potential) andRM0.75 (R2; 21% upside potential).

• Our stop-loss is pegged at RM0.56 (representing an 11% downside risk).

• Business-wise, EWINT engages in the development of real estate in Malaysia, the United Kingdom and Australia with grossdevelopment values of GBP4.7 billion and AUD0.7 billion respectively.

• Earnings-wise, the group narrowed its net loss to RM4.6m in 2QFY23 from a net loss of RM67.4m in 2QFY22, mainly due tothe appreciation of the GBP which resulted in foreign exchange gains recognised in the current quarter as opposed to foreignexchange losses in the previous quarter.

• In terms of valuation, the stock is currently trading at a price/book value multiple of 0.6x (or approximately 2 SD above itshistorical mean) based on a book value per share of RM1.01 as of end-April 2023.

Kerjaya Prospek Group Berhad (Technical Buy)

• KERJAYA’s share price has been trending sideways since the beginning of 2022 after hitting a high of RM1.37 in October 2021before reversing downwards and pulling back to close at RM1.10.

• Chart-wise, we believe the share price will likely resume its rising momentum as: (i) the 12-day moving average is still hoveringabove the 26-day moving average following the recent MACD golden cross, and (ii) the strengthening Parabolic SAR signal.

• That being the case, the stock is expected to climb towards our first resistance hurdle of RM1.21 (R1; 10% upside potential).Thereafter, the shares may increase further to challenge our next resistance threshold of RM1.32 (R2; 20% upside potential).

• We have placed our stop-loss price level at RM1.00 (representing a downside risk of 10%).

• Fundamentally speaking, KERJAYA is principally involved in the construction of high-end commercial and high-rise residentialbuildings, property development and manufacturing of lighting and kitchen solutions.

• Earnings-wise, the group reported a profit of RM29.4m in 1QFY23 compared with a net loss of RM28.9m in 1QFY22, mainlydue to an improvement in the progress of construction activities.

• Based on consensus forecasts, KERJAYA’s net earnings are projected to come in at RM147.2m in FY December 2023 andRM169.2m in FY December 2024, which translate to forward PERs of 9.4x and 8.2x, respectively.

Source: Kenanga Research - 24 Jul 2023