Top Story: Earnings Review – Stumbling growth and global risk aversion

 

Strategy Update

 

¨            2Q results continued to surprise on the downside despite our recent downward revision in earnings to take into account a slower-than-expected global economic recovery.  Of the 115 companies that we cover, 62 of the results (53.1% of the total) were within our expectations, 38 below projections (33.0% of the total) and 15 above forecasts (13.1% of the total).

 

Sector Call

 

Banks: 2QCY11 report card – Another quarter of record profits but growth slowing                          Neutral

 

Sector Update

 

¨            Generally, there were no major earnings surprises in the recent 2QCY11 reporting season.

 

Telecom: Mega school internet project                                Overweight

 

Sector Update

 

¨            Six companies (Maxis, Celcom, YTL Comms, Jaring, Multimedia Synergy Corp and a joint TM-Time dotCom bid) have been reportedly shortlisted for the RM1.5bn 5-year contract to provide Internet access and a virtual learning module (VLM) platform for the 9,924 schools in the country.

 

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25th August 2011

Top Story: TM – UniFi gains traction                                                                                                            Trading Buy

2QFY11 Results/Briefing Note

¨            2QFY11 core net profit of RM135m (+29.8% yoy +10.5% qoq) was within our expectations but below consensus. Management guided for EBITDA margin pressure in 2H due to maintenance works and higher A& P costs. Qoq, revenue rose 4% due to stronger data, internet and a surprise improvement in voice.

RM4.24