Tuesday, September 17, 2013

Malaysia Pre-UMNO Party Election (UOBKH)

Current FBMKLCI: 1,770.80
Target 2013 FBMKLCI: 1,760.

The UMNO election marks a good time to position for a year-end uptrend. As UMNO gears up for its triennial party election which will be held on 19 Oct 13, we expect the upcoming UMNO party election results to be largely marketneutral. The election results should affirm the country’s pro-business policies, the political will to curb the country’s fiscal deficit, with limited fiscal pressure on the just-announced Bumiputra Economic Empowerment policy.


What’s New
• The election is a good time to start positioning for year-end uptrend. As UMNO gears up for its party election which will be held on 19 Oct 13 ahead of its General Assembly (GA) on 2 Dec 13, we expect the upcoming UMNO party election results to be largely market-neutral - ensuring continuity of pro-business and fiscal consolidation policies. While UMNO typically holds its party elections during its GA, this year’s would be held in October (ahead of the GA in Dec 13) as polls were due in Mar 12 but were delayed by 18 months to prepare for the 13th General Elections which were held in May 13.

• We do not expect material challenge to the PM or DPM as party president and deputy president respectively, nor changes to the leaders of its Youth, Wanita and Puteri wings. Recent changes allow all the >130,000 UMNO members to participate in the polling process.

• Positive market bias in post-UMNO party elections. A review of UMNO’s past elections have shown that the FBMKLCI has generally trended higher pre- and/or post-GA (although this in part could be attributed by the December effect as the party GA is typically held towards year-end). While there have been no clear, consistent winners among GLCs and politically-linked stocks around these periods, we do note that Affin Holdings and Time dotcom had periods of outperformance vs FBMKLCI around the recent UMNO events.

• The PM also announced new Bumiputra economic empowerment programmes (BEP) to enhance the community’s economic participation, in thanking the bumiputra support during this year’s general election. Key measures included the call for GLCs to strengthen their Bumiputra vendor development systems, and extending the ‘carve out policy’ (which was implemented in the MRT projects) to other mega projects. Other measures such as a second Skim Amanah Saham Bumiputra, property development and ownership plans and additional allocations, grants and incentives were also unveiled (refer to RHS tables).

Action
• We continue to advocate a balanced portfolio. OVERWEIGHT highyielding companies in the telecommunications and number forecasting operator (NFO) sectors, as well as selected construction, O&G and those with exposure to Iskandar, which are ETP beneficiaries. 4Q13 investment themes include Selangor water privatisation, land value enhancement from the second Penang bridge opening, and positioning for 1Q14’s anticipated policy rate hike (although bank stocks are still sidelined on concerns of an uptick in NPL recognition). Maintain UNDERWEIGHT on cyclical sectors, particularly autos.

• Our top picks are DiGi.Com, Gamuda and Magnum, and we also like Axiata and SapuraKencana. Situational plays include IOI Corp and IJM Corp.

• Bumiputera companies that should benefit from the new Bumiputra programmes are proven Bumiputra companies in the oil & gas (SapuraKencana), construction (AZRB) and property sectors. Other beneficiaries could include MMC.

• Better market performance post-elections. Revisiting our analysis on market performances, the past five UMNO GAs and one UMNO election saw overwhelming consistency of the index churning positive returns both a month and two months after the events. Market returns have also been overall positive for the one- and two-month periods before the events, but not as convincing as the post-event performances (see charts below).

• BEP adds strength to capable Bumi companies. We do not expect the BEP to be a setback to 1Malaysia and the New Economic Model, nor raise undue concerns over the implications of the ‘carve out’ policy on the country’s overall competitiveness and progress of reforms. Rather, we expect investors, amid ample trading liquidity, to focus on the potential beneficiaries of BEP, eg vendors to Petronas, TM, TNB, UEM, Felda & Sime, although we reckon that the key beneficiaries are Bumiputra SMEs.



Source/Extract/Excerpts/来源/转贴/摘录: UOBKH-Research,
Publish date: 17/09/13

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Warren E. Buffett(沃伦•巴菲特)
Be fearful when others are greedy, and be greedy when others are fearful
别人贪婪时我恐惧, 别人恐惧时我贪婪
投资只需学好两门课: 一,是如何给企业估值,二,是如何看待股市波动
吉姆·罗杰斯(Jim Rogers)
“错过时机”胜于“搞错对象”:不会全军覆没!”
做自己熟悉的事,等到发现大好机会才投钱下去

乔治·索罗斯(George Soros)

“犯错误并没有什么好羞耻的,只有知错不改才是耻辱。”

如果操作过量,即使对市场判断正确,仍会一败涂地。

李驰(中国巴菲特)
高估期间, 卖对, 不卖也对, 买是错的。
低估期间, 买对, 不买也是对, 卖是错的。

Tan Teng Boo


There’s no such thing as defensive stocks.Every stock can be defensive depending on what price you pay for it and what value you get,
冷眼(冯时能)投资概念
“买股票就是买公司的股份,买股份就是与陌生人合股做生意”。
合股做生意,则公司股份的业绩高于一切,而股票的价值决定于盈利。
价值是本,价格是末,故公司比股市重要百倍。
曹仁超-香港股神/港股明灯
1.有智慧,不如趁势
2.止损不止盈
成功者所以成功,是因为不怕失败!失败者所以失败,是失败后不再尝试!
曾淵滄-散户明灯
每逢灾难就是机会,而是在灾难发生时贱价买股票,然后放在一边,耐性地等灾难结束
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