Oct 24, 2017 - that the amount offloaded has reached a net total of -RM558.3m in .... their affiliates may provide servi
24 October 2017 | 3QFY17 Results Preview
Maintain NEUTRAL
Bursa Malaysia Berhad
Unchanged Target Price (TP):RM11.00
Upsurge in ADTV, led by foreign selling binge INVESTMENT HIGHLIGHTS •
Bursa Malaysia (Bursa) is scheduled to release its 3QFY17 results on 25th October 2017
•
ADV traded in September soared
• •
RETURN STATS Price (23 October 2017)
RM10.00
We make no changes to our FY18 forecasts at this juncture
Target Price
RM11.00
We maintain our NEUTRAL stance with an unchanged TP of RM11.00
Expected Share Price Return
+10.0%
Expected Dividend Yield
+4.0%
3QFY17 earnings are expected to fall within estimates.
We
Expected Total Return
+14.0%
understand that Bursa will be releasing its 3QFY17 results on 25 October 2017. We expect bottomline to come in between RM47.0m and RM51.0m, or growth of around +6.6%yoy. The expected earnings expansion will be driven by stronger ADV traded for securities market
STOCK INFO KLCI
1,741.47
(OMT) and marginally higher ADC traded in derivatives market. Overall
Bursa / Bloomberg
the results are still expected to fall within our estimates.
Board / Sector
Higher ADV traded for securities market (OMT) in 3QFY17. ADV
Syariah Compliant
No
traded in 3QFY17 has increased to RM1.9b (+9.0%yoy). We believe the
Issued shares (mil)
RM537.5mil
upsurge in ADV was driven by the increase in trading activities among
Market cap. (RM’m)
RM5,375.0m
investors identified as foreign. Note that in the week ended 29
Price over NA
September, the net amount offloaded by global investors reached -
1818 / Bursa MK Main / Finance
6.59x
52-wk price Range
RM8.08-RM10.98
the week ended November 18 last year. On quarterly basis, we observe
Beta (against KLCI)
0.77x
that the amount offloaded has reached a net total of -RM558.3m in
3-mth Avg Daily Vol
0.82m
3QFY17. We believe that these net selling activities were mainly driven
3-mth Avg Daily Value
by market uncertainties, stemming from ongoing geopolitical tensions.
Major Shareholders (%)
Impact on earnings. We retain our FY forecasts at this juncture as we
Capital Market Dvlp
18.64
expect the impending results to come in line with our estimates.
KWAP
16.98
Recommendation and valuation. Correspondingly, we maintain our
EPF
7.03
RM967.3m. Notably, this was the highest weekly attrition recorded since
NEUTRAL stance on Bursa with an unchanged TP of RM11.00. Our valuation is based on FY18EPS of 43.4sen pegged to its 5-year historical average of 25x (1- standard deviation below). However, we do not preclude the possibilities of an upward revision to our valuation following the upcoming 3QFY17 results announcement. This is premised on the encouraging growth of ADTV in the month of September, circa +20.0%mom as well as better outlook on the macroeconomic
Abbreviations used: ADV = Average Daily Value ADC = Average Daily Contract FCPO = Crude Palm Oil Futures FKLI = FBMKLCI Futures BSAS = Bursa Suq Al-Sila OMT = On Market Trade DBT = Direct Business Transaction SR = Stable Revenue
performance for the rest of the year.
MIDF RESEARCH is a unit of MIDF AMANAH INVESTMENT BANK Kindly refer to the last page of this publication for important disclosures
RM8.28m
MIDF RESEARCH Tuesday, 24 October 2017
INVESTMENT STATISTICS
FYE Dec Revenue (RM'm) EBITDA (RM'm) Pre-tax Profit (RM'm) PATAMI (RM'm) Vs. Consensus Estimate (RM'm) EPS (sen) EPS growth (%) PER (x) Dividend (sen) Dividend Yield (%)
FY15 518.5 302.5 278.8 198.6 37.0 -0.1 27.0 34.5 3.5
FY16 506.8 294.8 270.6 193.6 36.0 -2.7 27.8 34.0 3.4
FY17F 546.2 316.3 293.2 208.8 221.6 38.7 7.6 25.8 36.0 3.6
FY18F 581.9 349.9 327.0 232.6 232.5 43.4 12.0 23.0 39.9 4.0
Source: Company, MIDFR
DAILY PRICE CHART
Danial Razak
[email protected] 03-2173 8396 Source: Bloomberg, MIDFR
2
MIDF RESEARCH Tuesday, 24 October 2017
APPENDICES Figure 1: Securities Market Trading Activity
Source: Bloomberg, MIDFR
Figure 2: Average Daily Contracts Traded
Source: Bloomberg, MIDFR
3
MIDF RESEARCH Tuesday, 24 October 2017
MIDF RESEARCH is part of MIDF Amanah Investment Bank Berhad (23878 - X). (Bank Pelaburan) (A Participating Organisation of Bursa Malaysia Securities Berhad)
DISCLOSURES AND DISCLAIMER This report has been prepared by MIDF AMANAH INVESTMENT BANK BERHAD (23878-X). It is for distribution only under such circumstances as may be permitted by applicable law. Readers should be fully aware that this report is for information purposes only. The opinions contained in this report are based on information obtained or derived from sources that we believe are reliable. MIDF AMANAH INVESTMENT BANK BERHAD makes no representation or warranty, expressed or implied, as to the accuracy, completeness or reliability of the information contained therein and it should not be relied upon as such. This report is not, and should not be construed as, an offer to buy or sell any securities or other financial instruments. The analysis contained herein is based on numerous assumptions. Different assumptions could result in materially different results. All opinions and estimates are subject to change without notice. The research analysts will initiate, update and cease coverage solely at the discretion of MIDF AMANAH INVESTMENT BANK BERHAD. The directors, employees and representatives of MIDF AMANAH INVESTMENT BANK BERHAD may have interest in any of the securities mentioned and may benefit from the information herein. Members of the MIDF Group and their affiliates may provide services to any company and affiliates of such companies whose securities are mentioned herein This document may not be reproduced, distributed or published in any form or for any purpose. MIDF AMANAH INVESTMENT BANK : GUIDE TO RECOMMENDATIONS STOCK RECOMMENDATIONS BUY TRADING BUY NEUTRAL SELL TRADING SELL
Total return is expected to be >15% over the next 12 months. Stock price is expected to rise by >15% within 3-months after a Trading Buy rating has been assigned due to positive newsflow. Total return is expected to be between -15% and +15% over the next 12 months. Total return is expected to be 15% within 3-months after a Trading Sell rating has been assigned due to negative newsflow.
SECTOR RECOMMENDATIONS POSITIVE
The sector is expected to outperform the overall market over the next 12 months.
NEUTRAL
The sector is to perform in line with the overall market over the next 12 months.
NEGATIVE
The sector is expected to underperform the overall market over the next 12 months.
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