Highlights
Steel Sector
Stronger steel demand ahead
• Steel demand is currently being supported by restocking
activities. And in FY10-11, steel producers will
benefit from pump-priming activities kicking off. The
sector is a beneficiary of the weakening USD.
• Expect 3Q09 earnings to improve q-o-q.
• Upgrade Southern Steel (TP RM2.40) and Kinsteel (TP
RM1.30) to Buy.
Axis REIT (RM1.85; Buy; Price Target: RM2.15; AXRB MK)
More acquisitions soon
• 3Q09 result was within our and market expectations.
• Recently completed placement and higher gearing
could lead to new acquisitions of RM150m.
• Maintain Buy for attractive 7% net yield and potential
growth from new acquisitions.
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