Wednesday, June 5, 2013

****** Accumulate on Dips: Yoma. Share price 0.97 (Watch the breakout of Critical 1.00)

Yoma has broken the 0.925 resistance yesterday which was the high set in Feb this year. Support currently at 0.90 to 0.925. Yoma is likely to consolidate from 0.925 to 1.00 before testing critical 1.00. Can consider accumulating on dips near support level. Bullish in the short if the 1.00 and 1.005 clears out completely. As long as 0.900 holds as support, short term upside is still valid. A break above 1.00 can see it go to 1.10 possibly fast to see a new all time high. We will average up on the break of 1.005. Currently at TOP 5 Volume and forming new high.
Stop loss at 0.89.
  
DBSV – 4TH JUNE 2013
Digicel makes compelling bid for Myanmar telco;
 
On Yoma: As discussed previously, a telco win would be positive for Yoma to evolve into a conglomerate and would add earnings/value to the stock over the long term. However, even a 5% stake in this US$6.6b project would require US$330m of capital. We feel Yoma may find the capital requirement challenging, but not impossible, to address at this juncture.

We have not factored in a telco license win for Yoma. If the consortium is successful, it could boost sentiment towards Yoma. However, the actual earnings impact may be immaterial, and possibly negative, in the first years because of aggressive initial capital investment.

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