DJ MARKET TALK: HwangDBS Retains MMC As Buy, MYR4.05 Target
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I have 5 biji at 2.92.
0517 GMT [Dow Jones] STOCK CALL: HwangDBS Vickers Research keeps MMC Corp. (2194.KU) at Buy with an unchanged MYR4.05 target; the house says the stock is a "strong alternative proxy" to Malaysia's planned MYR40 billion mass rapid transit project in the Klang Valley. "Our view is that the MMC-Gamuda (5398.KU) joint venture is the strongest contender for the MYR14 billion worth of tunneling works. We have factored in 50% of the discounted cashflow value, or MYR0.76/share, using 2011-2016 cash flows, 10% discount rate, 8.3% blended margin," says Hwang; it adds the expansion of MMC's 2,100MW Tanjong Bin coal-fired plant by another 1000MW is another key catalyst. MMC, the house says, also offers a strong proxy to the special economic zone Iskandar Malaysia, which makes up about 62% of MMC's sum-of-the-parts value. The stock is +0.3% at MYR3.08. (elffie.chew@dowjones.com)