23rd December 2011
| Top Story |
Construction – Due For A Reality Check Neutral
Sector Update
¨ We are downgrading our recommendation for the construction sector to Neutral from Overweight.
¨ Investors' confidence and comfort level that the Klang Valley MRT project will start work soon are being chipped away by further delays in the roll-out of certain already long-overdue large-scale projects.
Sector Update
Building Materials – Continued weakness for steel; cement affected by increased competition Underweight
Sector Update
¨ We believe global demand and prices for steel will likely remain weak in 2012 due to slower demand growth in China and the still-less-than robust construction activities in the developed countries.
¨ Share price of steel companies are likely to remain depressed in the absence of meaningful margin improvement, although most of them are already trading at trough level valuations.
Building Materials – Continued weakness for steel; cement affected by increased competition Underweight
Sector Update
¨ We believe global demand and prices for steel will likely remain weak in 2012 due to slower demand growth in China and the still-less-than robust construction activities in the developed countries.
¨ Share price of steel companies are likely to remain depressed in the absence of meaningful margin improvement, although most of them are already trading at trough level valuations.
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