Media - Hoping For A Seasonally Strong Finish (Neutral)

Sector Update

• The latest figures from Nielsen suggest that the sector still lacks catalysts. According to Nielsen’s figures, Aug’s gross advertising expenditure (adex) saw momentum losing steam after registering 2.7% yoy decline (Jul: +2.3% yoy), mainly due to a decline in print adex.
• However, we believe the sector has bottomed and expect adex to remain somewhat stable in 2H due to the recent Merdeka and Malaysia Day celebrations, as well as a seasonally robust 4Q. But the sector still is still bogged down by a cautious mood among advertisers.
• Maintain Neutral on sector as macro uncertainties may still weigh down advertisers’ sentiment. We prefer MCIL for attractive dividend yields and relatively resilient adex growth from exposure to the less vulnerable print segment.

Source: RHB Research - 11 Oct 2012