Tune insurance - more people is buying insurance due to MH 370 and MH17.
Heveaboard - US recovering more furniture need wood...
However, it pointed out that there was still value to be found. Small/mid-caps, as proxied by the FBM Small Cap Index, are up 21.7% YTD and 60.5% since the General Election in 2013, against the KLCI’s 0.6% and 10.8% respectively.
“Our top picks are MRCB, Deleum and Barakah (particularly its loan stock), while interesting situational stocks include Hong Leong Industries (see table overleaf).
“Notable NOT-RATED stocks include Suiwah, Tune Insurance and Heveaboard. Heveaboard’s earnings growth will be driven by higher operating margins from its expansion into higher-value ready-to-assemble (RTA) products, a more favourable product mix in the particle board segment, as well as a 50% decline in interest expense from 2Q14 onwards, having already settled its high-interest-rate term loans.
“Other beneficiaries of thematic investment plays include Sunway (emerging township in Medini, Iskandar) and SKP (cyclical recovery play).
“The recent retracement of HOLD–rated stocks that should rebound include Uzma and Tropicana. For year-end positioning, we like Perisai, Sunsuria and WCT,” it said.