Dow Jones: 26,156.10 pts (+131.14pts, +0.50%)
⬆ Resistance:  27000
⬇ Support:  25200

FBM KLCI: 1,507.04 pts (-4.20pts, -0.28%)
⬆ Resistance:  1560
⬇ Support:  1470

Crude Palm Oil: RM2,466 (+RM21, +0.86%)
⬆ Resistance:  2530
⬇ Support:  2300

Brent Oil: $42.63 (-$0.45, -1.04%)
⬆ Resistance:  44.9
⬇ Support:  39.3

Gold: $1,768.41 (+$13.98, +0.80%)
⬆ Resistance:  1810
⬇ Support:  1680

M+ Online Technical Focus - 24 Jun 20
SKP Resources Bhd: Production recovery alongside with share price

Trading Catalyst
• One of the leading players in the EMS industry in Malaysia backed by the 1) strong clientele base and 2) resumption of production to normalcy.
• The recent slump in 4QFY20 bottom line was largely impacted production disruption arising from Covid-19.
• Moving forward, a recovery will be materialise in subsequent quarters as production returns to normalcy, whilst demand also shift to higher gear.
• At current price of RM1.38, SKP is trading at forward PE of 13.9x and 11.6x for FY21 and FY22 respectively which is below the five-year historical average of 17.3x.
• Backed by a healthy balance sheet with a net cash position of RM41.3m; the only net cash position company amongst the three largest homegrown EMS players listed on Bursa Malaysia.

Technical View

SKPRES (S: RM1.28, R: RM1.52-1.59, LT TP:RM1.73, CL:RM1.27)

S: Support, R: Resistance, LT TP: Long term target price, CL: Cut loss

Source: Bloomberg, M+ Online

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