Friday, July 23, 2010

RHB Equity 360° - (Steel, BAT; Technical: Faber)

Sector Update

Ann Joo Resources : Target PER raised from 7x to 9x Market - Perform (up from UP)
CSC Steel : Target PER raised from 7x to 9x - Outperform (up from MP)
Hiap Teck Venture : Target PER raised from 7x to 9x - Market Perform
Kinsteel : Target PER raised from 7x to 9x - Underperform
Perwaja : Target PER raised from 7x to 9x - Outperform
Sino Hua-An : Target PER raised from 7x to 9x - Underperform

- We believe prices of steel products will likely stage a rebound in 4Q, as: 1) steel consumption is seasonally stronger in 4Q; 2) concerns on overcapacity in the steel sector are likely to ease in the near term; and 3) spot price of iron ore fines (key steelmaking input for most large steel mills in the world) has bottomed.

RHB Equity 360° - 23 July 2010 (Steel, BAT; Technical: Faber)

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