Market Dateline PP 7767/09/2010(025354)

RHB Research Institute

RHB Equity 360°

27 May 2010 (MPI, Ta Ann, KLK, RCE, Gent Plant, IJM Land, IJM Plant, IJM Corp, Proton, Tan Chong,
Mah Sing, Allianz, MCIL; Technical: UEM Land)

Top Story : MPI – Stronger Growth Ahead Outperform

Briefing Note
- MPI expects 4QFY06/10 revenue to register stronger qoq growth, given that 3QFY06/10 qoq growth of
+2.0% which bucks the trend of a seasonally weaker quarter.
- Also, MPI expects 4QFY06/10 net profit to grow sequentially on the back of: 1) higher utilisation rate; 2)
stronger contribution from MLP and high-density packages; and 3) margin expansion stemming from higher
contribution of high-density packages and cost-cutting measures.
- We understand that overall utilisation rates have increased to 95% from 85% in 2QFY06/10. Note that
utilisation rates for Ipoh, Suzhou, and Dynacraft plants currently stands at 95%, 100%, and 90%
respectively (vs. 90%, 100%, and 85% in 3QFY06/10).
- Separately, with Ipoh and Suzhou plants currently running at full-capacity, we understand that MPI expects
to raise capacity for these plants by 25% and 30% by Sep-10. Note that MPI is targeting to increase its
higher-margin MLP capacity to 12m/day by end-FY10 (vs. 8m/day currently). In addition, management had
stated that it will be using the spare capacity from the Advance Packages (AP) line to expand its MLP
packages as well as high-density packages. Furthermore, given the capex of around RM3m for its new
etch and strip plating capacity, MPI expects capacity for Dynacraft’ to increase by 20%.
- Maintain Outperform with a fair value of RM8.46/share.

Corporate Highlights

Ta Ann: 1QFY10 results likely to be impacted by higher FFB cost Outperform

Results Preview
- 1Q10 results (due out today) are likely to come in below our expectations. This is mainly due to the sharp
increase in FFB cost of >20% in 1Q10 vs. FY09 (from our initial assumption of a flattish FFB cost yoy). The
increase in FFB cost was mainly due to higher fertilizer cost following higher fertilizer application on its
plants during the quarter.
- Despite the more encouraging sales volume of Tasmanian plywood, the higher cash cost vs. average
selling prices continue to lead the entire plywood division into losses in 1Q10. Nevertheless, we note that
average selling prices transacted in 2Q10 so far for Tasmania plywood is up (+10-15% qoq), which could
mean that Ta Ann’s plywood division could start to break even during the quarter.
- We reduced our earnings forecasts by 11-15% for FY10-12 p.a.
- Our SOP-based fair value is reduced to RM6.45 (from RM7.20) based on unchanged 14x FY10 timber
division earnings and 14x FY10 plantation division earnings. Maintain Outperform.

IJM : FY03/10 EBIT Only Grows 3% Market Perform

1QFY10 Results/Briefing Note
- Normalised FY03/10 net profit of RM263.6m came in within our forecast but missed the market consensus
by a whopping 15%.
- IJM’s outstanding construction orderbook currently stands at about RM3.6bn and it is confident about
securing RM2bn new contracts per annum.
- While we gathered from our sources that IJM had won the two Murum access road work packages on
“brutally competitive” prices, IJM assured that it “knows the Sarawak market very well” and the job is not
“tactical” but profit-driven.
- Maintain Market Perform. Fair value is RM4.88.
Media Chinese Int’l : FY10 Core Net Profit Surged 95.6% YoY Outperform
4QFY10 Results/Briefing Note
- MCIL’s 4QFY03/10 net profit beat our and consensus expectations. We believe the key variances were: 1)
stronger-than-expected margins and a lower-than-expected 4Q effective tax rate.
- QoQ, revenue fell 11.6% due to weaker contribution from the print and publishing as 4Q is typically a
slower quarter. 4Q10 EBIT plunged 40.5% qoq on the back of the weaker revenue and 7%-pts drop in
margin, which we believe reflects the operating leverage effects while 4Q10 net profit fell by a slower pace
of 34% qoq thanks to a lower effective tax rate of 17.7% (vs. 23.5% in 3Q10).
- We have lowered our FY11 and FY12 effective tax rate assumptions slightly to around 25% p.a. (from
around 27.5% p.a.). As a result our FY11 and FY12 earnings forecasts have been raised slightly by 3.3%
and 3.2% respectively.
- Our fair value is raised to RM1.14 (from RM1.09), based on unchanged target CY10 PER of 13x. Maintain
Outperform.

Genting Plantation : Improving Earnings Underperform

1QFY10 Results/Briefing Note
- Genting Plantation’s (GP) core 1QFY10 net profit was in line with our and consensus expectations, coming
in at 21-23% of our and consensus FY10 forecasts. No dividend was declared for the quarter. In 1QFY10,
GP’s core net profit rose 88% on the back of a 59% increase in turnover. The increase due to a rise in FFB
production (+10.4% yoy) and higher CPO prices achieved (+38% yoy); offset slightly by a 10% yoy
increase in cost of production to RM1,076/tonne.
- Four key briefing takeaways: : (1) No change in price outlook, still not selling forward; (2) Its all about the
weather; (3) Increasing fertiliser application; and (4) tree planting targets on track to be met.
- We tweaked our forecasts slightly by between -0.1-0.6% for FY10-12, post- results. No change to our fair
value of RM6.65 based on 16.5x CY10 target PE multiple. Although GP’s share price has fallen to our fair
value, we maintain our Underperform recommendation for now. We would only look to picking up this
stock, if it falls below our current target price.

Other Corporate Results

Company Quarter Result Results Comment And Changes To Forecasts Recom

Mah Sing 1Q10 In line No change to forecasts. OP, FV =
RM2.09
IJM Land 4Q10 In line FY03/11-12 net profit forecasts downgraded by 0.7-20.7%. The OP, FV =
removal of contribution from the RM5bn mixed Canal City project (due RM3.06
to the delay in land acquisition) more than offsets contribution from the
new project in Vietnam.
Puncak 1Q10 In line No change to forecasts. UP, FV =
Niaga RM2.55
IJMP 4QFY03/10 In line After adjusting for FY03/10 earnings, we tweak our forecasts by -2.0% UP, FV =
to -4.6% for FY11-12 and introduce our FY13 forecasts. Fair value RM2.30
reduced slightly to RM2.30, based on unchanged target PER of 16.5x
CY10 earnings.
KLK 2QFY09/10 In line No change to forecasts but revise our SOP-based fair value for KLK OP, FV =
down slightly to RM18.25 (from RM18.40), after taking into account the RM18.25
latest net debt figure.
RCE 4QFY03/10 In line We fine-tuned and raised our FY11-12 earnings forecasts by 0.3-1.6% OP, FV =
after updating for the full-year results. We also raised our FY11-12 net RM1.18
DPS projections to 1.53 sen p.a. from 0.75 sen p.a. given the higher-
than-expected final net DPS of 1.53 sen (vs. expected 0.75 sen). Fair
value raised to RM1.18 from RM1.15 based on 11x CY10 EPS.
Allianz 1Q10 In line No change to forecasts. OP, FV =
RM6.68
Tan Chong 1Q10 In line No change to forecasts. Maintain fair value of RM 5.26 based on 14x OP, FV =
 FY10 EPS . RM 5.26
Proton 4Q10 In line No change to forecasts. New fair value of RM5.51 based on stripped OP, FV=
down book value. RM5.51

Technical Highlights

Daily Trading Strategy : More To Stay Sidelined Ahead Of The Long Weekend Holiday…
- Due to the last-minute sell down in selective heavyweights, the FBM KLCI failed to stage a technical
recovery leg.
- With a record of the ninth negative candles in a row, plus a breach to below the immediate support of 1,250
yesterday, the index is poised to see a return of selling momentum in the near term.
- Though the index may still see a possible jump today based on the “8 to 10 candles” pattern formation, the
weaker momentum readings suggest that chances are dwindling lower now.
- Instead, the index could head towards the first correction target near the 23.6% FR level at 1,229 and the
1,200 pyschological threshold soon, if the selling resumes fast and the index is kept at below 1,250 today.
- Therefore, we continue to stay bearish, and expect investors to stay further sidelined ahead of the long
weekend holiday. The financial market in Malaysia will be closed for Wesak day on Friday.

Daily Technical Watch: UEM Land Holdings – Stuck within RM1.15 – RM1.24 to RM1.46 trading region…
- 10-day SMA: RM1.297
- 40-day SMA: RM1.392
- Support: IS = RM1.24 S1 = RM1.15 S2 = RM0.85
- Resistance: IR = RM1.46 R1 = RM1.65

Bulletin Board

Co/Sector News Impact Recom

Genting Genting Malaysia has announced that it did not
Malaysia exercise the option to acquire Karridale Limited
from KH Digital Ltd at an exercise price of
US$27m (approximately RM90.8m) and that the
call option has lapsed. (Bursa Malaysia)
Consumer – Government has deferred the ban on 14 stick
Tobacco cigarettes which was supposed to take effect on
1 Jun 10 according to sources. However, it is not
known if a new deadline has been set yet. (The
Edge)
Positive, as this will assuage investors’ concerns MP, FV =
on corporate governance given that this call 2.90
option, if exercised, would have been another
related party transaction for a company with no
guaranteed earnings stream. Recall when GM
first bought Bromet Ltd and Digital Tree Inc from
KH Digital for US$69m back in Nov 08, investors
reacted negatively and GM’s shares were sold
down substantially.
Neutral. Tobacco players have already started N (BAT;
phasing out their small packs inventory over the UP: FV =
past 5 months and decommissioned / exported RM38.95)
their 14s manufacturing equipment. While this
may seem positive in the long term, we believe
the uncertainty as to when the deadline will be
set will result in industry players not knowing
whether to recommission their 14s production
line or to stick with the current strategy. To re-
commission their 14s production would take
some time and we may potentially see further
cost increase and revenue loss for the tobacco
players if this is done in the short-term. We are
unable to assess the impact to BAT’s bottomline
at this juncture, pending further information from
management.

Important Dates
 Company Entitlement details Ex-date Payment date
New entitlements
Evergreen Tax-exempt interim dividend of 2 sen 14-Jun-10 29-Jun-10
Kuala Lumpur Kepong Interim single tier dividend of 15 sen 14-Jul-10 9-Aug-10
Final dividend of 20% tax-exempt + Special dividend of 10% tax-
Willowglen MSC exempt 9-Jun-10 30-Jun-10
Tomypak Holdings Tax exempt interim dividend of 3.5 sen 9-Jun-10 2-Jul-10
Peliken International Final single tier dividend of 2 sen
Corporation 13-Aug-10 15-Sep-10
Batu Kawan Single tier interim dividend of 15 sen 14-Jul-10 11-Aug-10
Final gross dividend of 1.8 sen less 25% tax + final single tier div of
DKSH Holdings 1.65 sen 19-Jul-10 18-Aug-10
Jerneh Asia Final dividend of 5 sen less 25% tax 9-Jun-10 22-Jun-10
First & final div of 5 sen less 25% tax + Special div of 5 sen less 25%
Ya Horng Electronic tax 28-Jun-10 21-Jul-10
Freight Management Gross interim dividend of 2.5 sen less 25% tax 28-Jun-10 15-Jul-10
Bintulu Port Holdings First interim single tier dividend of 7.5 sen 14-Jul-10 4-Aug-10
IJM Corporation Interim dividend of 11 sen less 25% tax 28-Jul-10 24-Aug-10
IJM Plantations Interim dividend of 5 Sen single Tier 28-Jul-10 17-Aug-10
IJM Land Interim dividend of 2 sen single tier 28-Jul-10 19-Aug-10
Unimech Group Final dividend of 3.7sen less 25% tax 28-Jun-10 23-Jul-10

Going “ex” on 31 May

Hap Seng Consolidated Final dividend of 7 sen tax exempt 31-May-10 11-Jun-10
Apex Healthcare Final dividend of 4.5 sen less tax 31-May-10 23-Jun-10
Samchem Holdings First & final single tier dividend of 2.8 sen 31-May-10 23-Jun-10
Wellcall Hldgs Single tier interim tax exempt dividend of 2.5 sen 31-May-10 25-Jun-10

...For more details, see individual reports attached

IMPORTANT DISCLOSURES

This report has been prepared by RHB Research Institute Sdn Bhd (RHBRI) and is for private circulation only to clients of RHBRI and RHB Investment Bank Berhad (previously known as RHB Sakura Merchant Bankers
Berhad). It is for distribution only under such circumstances as may be permitted by applicable law. The opinions and information contained herein are based on generally available data believed to be reliable and are
subject to change without notice, and may differ or be contrary to opinions expressed by other business units within the RHB Group as a result of using different assumptions and criteria. This report is not to be construed as
an offer, invitation or solicitation to buy or sell the securities covered herein. RHBRI does not warrant the accuracy of anything stated herein in any manner whatsoever and no reliance upon such statement by anyone shall
give rise to any claim whatsoever against RHBRI. RHBRI and/or its associated persons may from time to time have an interest in the securities mentioned by this report.

This report does not provide individually tailored investment advice. It has been prepared without regard to the individual financial circumstances and objectives of persons who receive it. The securities discussed in this
report may not be suitable for all investors. RHBRI recommends that investors independently evaluate particular investments and strategies, and encourages investors to seek the advice of a financial adviser. The
appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives. Neither RHBRI, RHB Group nor any of its affiliates, employees or agents accepts any liability for
any loss or damage arising out of the use of all or any part of this report.

RHBRI and the Connected Persons (the “RHB Group”) are engaged in securities trading, securities brokerage, banking and financing activities as well as providing investment banking and financial advisory services. In the
ordinary course of its trading, brokerage, banking and financing activities, any member of the RHB Group may at any time hold positions, and may trade or otherwise effect transactions, for its own account or the accounts of
customers, in debt or equity securities or loans of any company that may be involved in this transaction.

“Connected Persons” means any holding company of RHBRI, the subsidiaries and subsidiary undertaking of such a holding company and the respective directors, officers, employees and agents of each of them. Investors
should assume that the “Connected Persons” are seeking or will seek investment banking or other services from the companies in which the securities have been discussed/covered by RHBRI in this report or in RHBRI’s
previous reports.

This report has been prepared by the research personnel of RHBRI. Facts and views presented in this report have not been reviewed by, and may not reflect information known to, professionals in other business areas of
the “Connected Persons,” including investment banking personnel.

The research analysts, economists or research associates principally responsible for the preparation of this research report have received compensation based upon various factors, including quality of research, investor
client feedback, stock picking, competitive factors and firm revenues.

The recommendation framework for stocks and sectors are as follows : -

Stock Ratings

Outperform = The stock return is expected to exceed the FBM KLCI benchmark by greater than five percentage points over the next 6-12 months.

Trading Buy = Short-term positive development on the stock that could lead to a re-rating in the share price and translate into an absolute return of 15% or more over a period of three months, but fundamentals are not
strong enough to warrant an Outperform call. It is generally for investors who are willing to take on higher risks.

Market Perform = The stock return is expected to be in line with the FBM KLCI benchmark (+/- five percentage points) over the next 6-12 months.

Underperform = The stock return is expected to underperform the FBM KLCI benchmark by more than five percentage points over the next 6-12 months.

Industry/Sector Ratings

Overweight = Industry expected to outperform the FBM KLCI benchmark, weighted by market capitalisation, over the next 6-12 months.

Neutral = Industry expected to perform in line with the FBM KLCI benchmark, weighted by market capitalisation, over the next 6-12 months.

Underweight = Industry expected to underperform the FBM KLCI benchmark, weighted by market capitalisation, over the next 6-12 months.

RHBRI is a participant of the CMDF-Bursa Research Scheme and will receive compensation for the participation. Additional information on recommended securities, subject to the duties of confidentiality, will be made
available upon request.

This report may not be reproduced or redistributed, in whole or in part, without the written permission of RHBRI and RHBRI accepts no liability whatsoever for the actions of third parties in this respect.