Stock Upgraded: MMI, Seksun, Unisteel by CIMB-GK

CIMB-GK Research says MMI Holdings Ltd, Seksun Corp Ltd and Unisteel Technology are its top picks among the suppliers of components for hard-disk drives (HDDs) that are listed here. The brokerage said the HDD industry was on track to achieve double-digit quarter-on-quarter growth in the third quarter and that it expected these companies to report results that would be catalysts for the price of their stocks. "MMI and Seksun are two prime beneficiaries of expected volume increases from Seagate after the Seagate-Maxtor merger," CIMB-GK said in a note. "Unisteel will gain from the overall industry growth," it said. The brokerage has raised its target price for MMI to 1.36 sgd per share from 1.25 sgd, having increased its estimates of earnings for the company for the financial years ending June 2007 and June 2009 by 3-4 pct. CIMB-GK has raised its target price for Seksun to 0.60 sgd from 0.53 sgd. "Among the HDD component suppliers, we sense that Seksun experienced the strongest quarter-on-quarter expansion, gaining from its major customer's volume growth and possibly market-share gains," the brokerage said. At 3.45 pm, MMI was up 0.01 sgd or 1.02 pct at 0.99 and Seksun up 0.005 sgd or 1.33 pct at 0.38, while Unisteel was down 0.01 sgd or 0.49 pct at 2.04.