Think Outsyed The Box !!
Investment Analyst's View GE13
I received this in the mail. I
have truncated it and edited a few words. This is what some Investment Analysts
are predicting. Note the words in red.
There is a disclaimer - "J.P. M***an does and seeks to
do business with companies covered in its research reports. As a result,
investors should be aware that the firm may have a conflict of interest that
could affect the objectivity of this report. Investors should consider this
report as only a single factor in making their investment decision."
The upcoming 13th General Elections
(June/Sept possible) is the key market risk.
We have embarked on a joint-research
with C****E, which provides independent research and analysis on political
issues. Stay cautious pre elections, stick to apolitical names with
growth/dividends.
C****E’s key conclusion: BN (ruling
alliance) should win about 137 parliamentary seats, +/- 5%, a majority of
between 58-64%.
Non-consensus views include:-
1) PM Najib will not be challenged
from within so long as UMNO retains more than 78 seats
2) Malay middle ground voters have swung in favour of BN, more so
after Bersih 3.0 rally
3) market is concerned with the 2.3MM
new registered voters who may vote against BN, but most of the new voters are registered in Johor, Selangor and
Perak, where seats are already lost to the Opposition, where
4) More votes do not necessarily mean more seats for ... PR
(opposition alliance).
Positive scenarios: C****E outlines
five scenarios, J.P. Mo**an analyses market impact.
Scenario A (BN wins 61% of seats,
status quo),
2. Scenario B (BN wins >61% but
short of a two thirds majority),
3. Scenario C (BN wins two thirds
majority); all suggest policy continuity and an expected short term relief
rally (big rally for outcome C). Sectors that benefit the most longer-term
should include: Construction and Oil & Gas directly, and Banks,
Property and Media indirectly. Top picks in these sectors include: IJM, Dialog,
CIMB, IJM Land and Media Prima.
4. Neutral / negative scenarios:
Scenario D (BN wins 50-61%). Negative for market if <55%.
55% to 61%
(provided PM Najib is not challenged from within) neutral for market given
policy continuity, hence similar picks as above. Scenario D (PR wins): Sell and stay away, potential policy
changes breed uncertainty.
Most impacted sectors :
construction, property, transportation, gaming and stocks with perceived government linkages.
Key stocks affected include: Tenaga, YTL Power, MMC,
Gamuda, IJM, WCT, MRCB.
No comments:
Post a Comment