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Thursday, October 10, 2013

HL Investment Research sees Integrated Rubber Corporation as Oversold (Star)

Hong Leong Investment Bank Research (HLIB Research) sees Integrated Rubber Corporation Bhd (IRCB) as being oversold.

HLIB Research said on Thursday that on Sept 30, IRCB announced multiple proposals of restructuring exercises. The estimated timeframe for the proposals is expected to be completed by the first half of 2014.

“Hence, we could see a potential trading opportunity in IRCB. Since tumbling from the high of 55 sen to the recent low of 27.5 sen, IRCB’s selling spree may have exhausted.

“Underpinned by strong support of 28 sen as a base, share price is getting oversold. Share price is expected to bottom up as the indicators are on the mend.

”Further upside targets are at 32 sen (five day simple moving average), 33 sen (50-day SMA) and 35 sen (10-day SMA), with long term objective at 38.5 sen,” it said.

HLIB Research said the immediate supports are at 29.5 sen and 28.5 sen and the cut loss is at 28 sen.

However, for cheaper exposure, it said traders might consider IRCB-WA. HLIB Research said IRCB’s core activities are manufacturing and trading of powdered and powder-free natural rubber latex (NRL) and nitrile examination gloves, which are used in hospital, nursing homes, industrial plant and food handling processes.

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