Potential Headwinds Ahead
Company Update
Lacking major contract announcements over the past three months, we believe Prestariang’s 2H14 earnings could come under further pressure after 1H14’s disappointments. We also caution that potential delays in firming up a strategic partner for its university could translate into further near-term losses. Hence, we downgrade our TP to MYR1.60 (from MYR2.00), based on revised 16.0x FY15F P/E. Maintain NEUTRAL.
Favelle Favco (FFB MK, BUY, TP: MYR3.62) (Upgraded)
Company Update
Heavy Lifting Comes Easy
Favelle Favco announced new crane orders for a total of MYR59.7m, due to be delivered in 2015. The new orders are still within our FY15F estimates. As the fundamentals of the company are still intact and given the recent weakness in its share price, we take this opportunity to upgrade our recommendation to BUY from Neutral, with an unchanged TP of MYR3.62, with an upside of 16%.
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