Hock Seng Lee Berhad : Lands RM99m Gedong-Simunjan Road Project - 22/09/2010

♦ Another job in the bag. As we pre-empted last week (see our Company
Update on HSL dated 17 Sep 2010), HSL announced that it had been
awarded a RM98.7m construction contract for the Gedong-Simunjan Road in
Samarahan, Kuching. The latest contract has boosted its YTD new
orderbook secured to RM444m (see Table 2) and its outstanding
construction orderbook by 8% from RM1.22bn to RM1.32bn. Assuming an
EBIT margin of 12-15%, the contract would fetch RM11.8-14.8m EBIT over
the construction period ending Mar 2013.

Hock Seng Lee Berhad : Lands RM99m Gedong-Simunjan Road Project - 22/09/2010

Hock Seng Lee Berhad : Close To Clinching Another Job Worth About RM100m? - 17/09/2010

♦ Another job in the bag? We understand from sources that Hock Seng Lee
(HSL) is likely to be awarded an infrastructure job in Sarawak worth about
RM100m within the next 1-2 weeks. If this materialises, HSL’s YTD new
orderbook secured will increase from RM345m at present (see Table 2) to
about RM445m while its outstanding construction orderbook will rise from
RM1.22bn at present to about RM1.32bn. Assuming an EBIT margin of 12-
15%, the contract would fetch RM12-15m EBIT over the construction
period.

Hock Seng Lee Berhad : Close To Clinching Another Job Worth About RM100m? - 17/09/2010

Hock Seng Lee Berhad : Secures RM83.3m Infrastructure Works For Palm Oil Industrial Cluster In Sarawak - 15/09/2010

♦ Another new contract. HSL has been awarded by Sarawak Timber
Industry Development Corporation a RM83.3m contract for infrastructure
works for the palm oil industrial cluster project in Tanjung Manis, Sarawak.
Assuming an EBIT margin of 12-15%, the contract will fetch a total EBIT of
RM10.0-12.5m over the construction period ending Oct 2012. The latest
contract has boosted HSL’s YTD new jobs secured to RM345m (see Table 2)
and outstanding construction orderbook to RM1.22bn.

Hock Seng Lee Berhad : Secures RM83.3m Infrastructure Works For Palm Oil Industrial Cluster In Sarawak - 15...

Hock Seng Lee Berhad : 1HFY12/10 Net Profit Grows By A Whopping 36% YoY - 26/08/2010

No issue. 1HFY12/10 net profit came in at 42-43% of our full-year forecast and the full-year market consensus. However, we consider the results within expectations as we expect a stronger 2H ahead as construction activities gather momentum.

Hock Seng Lee Berhad : 1HFY12/10 Net Profit Grows By A Whopping 36% YoY - 26/08/2010

Hock Seng Lee Berhad : Secures A RM47.1m Road Job In Sarawak - 23/08/2010

♦ Another new contract. HSL has been awarded by Sarawak Timber
Industry Development Corporation a RM47.1m contract for the construction
of a new road linking Serdeng Junction, Bandar Baru Tanjung Manis, Halal
Park and Kampung Rajang in Mukah Division, Sarawak. Assuming an EBIT
margin of 12-15%, the contract will fetch a total EBIT of RM5.7-7.1m over
the construction period of 24 months commencing Aug 2010. The latest
contract has boosted HSL’s YTD new jobs secured to RM262m (see Table 2)
and outstanding construction orderbook to RM1.14bn.
\Hock Seng Lee Berhad : Secures A RM47.1m Road Job In Sarawak - 23/08/2010

Hock Seng Lee Berhad : Close To Clinching A Road Job Worth About RM100m? - 19/08/2010

♦ A road job in the bag? We understand from sources that Hock Seng Lee
(HSL) is close to clinching a road job in Sarawak worth about RM100m. If it
materialises, the contract will help to boost HSL’s YTD new orderbook
secured to about RM300m (see Table 2) and sustain its outstanding
construction orderbook at RM1.2-1.3bn. Assuming an EBIT margin of 12-
15%, the contract would fetch RM12-15m EBIT over the construction
period.

Hock Seng Lee Berhad : Close To Clinching A Road Job Worth About RM100m? - 19/08/2010

Mandarin Version : Hock Seng Lee - Chances For More Run-ups Ahead Are High… 09/08/2010

HSL broke out from a major resistance of RM1.54 lately. Despite HSL’s share
price hit a high of RM1.59 in end-Mar 2010, the failure to defend the RM1.54
important technical level sparked off profit-taking pressure. But, the stock was wellsupported by the UTL throughout the months. It engineered a positive technical
breakthrough to above RM1.54 last Thursday and settled at RM1.59 with a “starlike”
candle on last Friday. This indicates a potential pullback to retest RM1.54
support this week if buying fails to accelerate.

Mandarin Version : Hock Seng Lee - Chances For More Run-ups Ahead Are High… 09/08/2010

Hock Seng Lee - Chances For More Run-ups Ahead Are High… 09/08/2010

HSL broke out from a major resistance of RM1.54 lately. Despite HSL’s share
price hit a high of RM1.59 in end-Mar 2010, the failure to defend the RM1.54
important technical level sparked off profit-taking pressure. But, the stock was wellsupported by the UTL throughout the months. It engineered a positive technical
breakthrough to above RM1.54 last Thursday and settled at RM1.59 with a “starlike”
candle on last Friday. This indicates a potential pullback to retest RM1.54
support this week if buying fails to accelerate.

Hock Seng Lee - Chances For More Run-ups Ahead Are High… 09/08/2010

Hock Seng Lee - Secures A RM72.5m Road Job In Sarawak - 10/6/2010

Another new contract. HSL, via a 90:10 JV with a local bumiputera contractor known as Matrik Besar Sdn Bhd, has secured the RM72.5m construction contract for the access road linking Technology Park Samarahan to Tanjong Bako, Kuching. The payment will be 50% in cash and 50% in kind in the form of land. Assuming an EBIT margin of 15-18%, the contract will fetch a total EBIT of RM10.9-13.1m over the construction period of 30 months ending Dec 2012.

Hock Seng Lee - Secures A RM72.5m Road Job In Sarawak - 10/6/2010

RHB Equity 360° - 10 June 2010 (Market, O&G, HSL; Technical: Kumpulan Europlus)

We are nearly six months into 2010, and the focus is clearly back on risk. We believe investors’ confidence especially for exporters has been shaken by economic concerns in Europe and China, while incidents such as BP’s deepwater drilling accident in the Gulf of Mexico and Australia’s proposed resources tax will not help the outlook for resources sectors.

RHB Equity 360° - 10 June 2010 (Market, O&G, HSL; Technical: Kumpulan Europlus)

Hock Seng Lee Berhad : 1QFY12/10 Net Profit Grows By 30% YoY - 26/05/2010

No issue. 1QFY12/10 net profit came in at 18-19% of our full-year forecast and the full-year market consensus. However, we consider the results within expectations as we expect stronger quarters ahead as construction activities gather momentum.

Hock Seng Lee Berhad : 1QFY12/10 Net Profit Grows By 30% YoY- 26/05/2010

RHB Equity 360° (Market, Consumer, Steel, Kencana, Sunway, MPI, HSL, KFC, Kinsteel, Perwaja, KNM; Technical: Genting Malaysia)-26/05/2010

Top Story : Shifting Trends – Seeking shelter in domestic plays
Market Update
♦ The FBM KLCI has erased all its gains and more during the first five months of 2010 since turning downwards on 13 May. We expect the market to remain volatile, with the risk on the downside.
♦ We have used historical valuations and market data in order to find possible fundamental support levels for the FBM KLCI:
1) Average one-year forward PER for FBM KLCI stocks since 2000 is estimated to be around 15x, and one standard deviation (SD) below the mean is estimated to be around 13.3x, which is coincidentally the same valuation at the next technical support of 1,154 for the FBM KLCI; and
2) Annual returns for the FBM KLCI over the last 32 years have averaged around 13% and 1SD below the mean would imply a pullback of around -17.6%. However, we note that a 1SD fall has only occurred seven times over the last 32 years. As it stands, the FBM KLCI has already fallen by 7.2% from the peak this year.
♦ Having painted a near-term bearish picture for the market, we highlight that the correction is driven more by external factors relating to fears over global macroeconomic conditions especially in the EU. We acknowledge that these concerns could result in some of our earnings forecasts coming under pressure.

Therefore, in our view, companies that have little or hedged exposure to overseas markets or imported costs are likely to be more resilient. These domestic plays include Maxis, TNB, PLUS, Allianz, AEON, KFC, KPJ and B-Toto.

RHB Equity 360°(Market, Consumer, Steel, Kencana, Sunway, MPI, HSL, KFC, Kinsteel, Perwaja, KNM;Technical: ...

Corporate Highlights - 19/5/2010

♦ Hock Seng Lee
Visit Note : Poised To Top RM500m Orderbook Target In FY12/10

♦ MISC
Briefing Note : VTTI Does Not Come Cheap

♦ Motor
Sector Update : Apr TIV increased 16.8% YoY

♦ M’sian Resources Corp
Results Note : Construction And Property Development Activities Gather Momentum In 1QFY12/10

♦ AEON Co
Results Note : Earnings Impact From 1U Contract Well Buffered

♦ Parkson Holdings
News Update : PRG 1QFY12/10 Results In Line

Corporate Highlights - 19/5/2010

Hock Seng Lee Berhad : Poised To Top RM500m Orderbook Target In FY12/10 - 19/5/2010

RM310m new jobs secured YTD. YTD, HSL has secured about RM310m worth of new jobs (see Table 2). With about another RM300m worth of new jobs that are “almost in the bag”, it now appears that HSL is likely to top its FY12/10 new orderbook guidance of RM500m.

Hock Seng Lee Berhad : Poised To Top RM500m Orderbook Target In FY12/10 - 19/5/2010

RHB Equity 360° - 19 May 2010 (HSL, Motor, MISC, Parkson, MRCB, AEON; Technical: SapuraCrest)

Visit Note:
- HSL has secured RM310m worth of new jobs YTD and is poised to top its full-year target of RM500m.
- HSL is cool about dropping out of the race for the Murum access road work packages as it believes it could always deploy its resources elsewhere for much higher returns.
- HSL plans to oursource more work to sub-contractors over time but will fully retain land reclamation work.
- We are raising FY12/10-12 net profit forecasts by 3-12% largely to reflect higher annual orderbook targets of RM600m (from RM500m previously).
- Fair value is from RM1.56 to RM1.61. Maintain Market Perform.

RHB Equity 360° - 19 May 2010 (HSL, Motor, MISC, Parkson, MRCB, AEON; Technical: SapuraCrest)

Hock Seng Lee Berhad : FY12/09 Net Profit Grows By 35% - 01/03/2010

No issue. FY12/09 net profit came in within our forecast but beat the market consensus by 10%.

Hock Seng Lee Berhad : FY12/09 Net Profit Grows By 35% - 01/03/2010