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https://theedgemalaysia.com/node/70619

Low volume move to uncharted territory

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Mario Draghi is waiting for Spain to get back to him on whether his plan to save the eurozone is needed. One month after the European Central Bank (ECB) president unveiled an unprecedented bond purchase programme to rescue Europe’s embattled southern fringe, Spanish Prime Minister Mariano Rajoy is reluctant to ask for the aid he pushed for with Italy on concerns about the terms attached to it. Spain faced a pressure test from the markets yesterday as it sold as much as US$5.2 billion (RM15.86 billion) worth of bonds after Finance Minister Luis De Guindos said officials were still considering whether they actually need the ECB’s help. The Dow Jones Industrial Average increased by 12.25 points to 13,494.61 on Wednesday. The FBM KLCI traded in a wider price range for the fourth week in a row of 28.75 points, with low volumes of 0.81 billion to 0.97 billion done. The index closed at 1,661.47 on Oct 4, up 11.72 points from the previous day as blue chips like Axiata Group Bhd, CIMB Group Holdings Bhd, Kuala Lumpur Kepong Bhd (KLK), Petronas Gas Bhd, Sime Darby Bhd and Tenaga Nasional Bhd, caused the index to rise in a bout of selective buying. With the rebound tone that emerged since the late September low of 1,595.85, the obvious support levels are seen at 1,595, 1,651 and 1,661 points, while the only resistance level (and all-time high) of 1,662 may cap any initial market advance. The rise from the 801.27 low (October 2008) to the current all-time high of 1,662.14 represents an extended Elliott Wave “Flat” rebound in a “Pseudo-Bull” rise.  Continue to take profit on any price rally as rampant bearish divergence signals (ADX, CCI, DMI, MACD, MACD Histogram, Oscillator and RSI) are apparent. The CCI, DMI, MACD, Oscillator and Stochastic signals have turned positive currently though. Tactically, investors may continue to take profit on rallies due to the divergence signals. We see the index in a fresh trading range at even more lofty levels. A modest upside index target is now pitched at 1,683. However, risks to the downside could emerge for the index if global economies start to slow down. Crude palm oil (CPO) futures have fared badly since the February 2011 high of RM3,967 per tonne. The next two key swings of the index were RM2,754 (the October 2011 low) and RM3,628 (the April 2012 high). CPO futures fell to a new recent low of RM2,230 (Oct 3) and rebounded to RM2,352  at the close on Oct 4. CPO futures are in a triple time frame downtrend (daily, weekly and monthly) and any attempts at bargain hunting may be sold down as such. Support levels of RM2,154, RM2,230 and RM2,321 per tonne may be weaker, while very heavy selling at the resistance levels of RM2,352, RM2,560 and RM2,754 per tonne are likely to keep prices depressed. With depressed prices, plantation stocks’ profitability on the exchange are likely to be crimped. Our medium-term downside targets for CPO futures are RM1,730 and RM2,010 per tonne. Due to our cautiously optimistic outlook for the index, our featured chart sell for this week is KLK. The company experienced an 11.9% year-on-year (y-o-y) drop in revenue from RM2.95 billion to RM2.6 billion y-o-y for the third quarter of the financial year ended September (3QFY12). This major decline was mainly due to the decrease in earnings contributed by its plantation arm as plantation revenue shrank by 21.9% from RM1.41 billion last year to RM1.1 billion in the latest quarter, mainly due to the decline in fresh fruit bunch production that has also corroded substantially by 14.8% from 860,338 tonnes last year to 732,689 tonnes due to biological tree stress. Besides that, the average selling price for KLK’s palm and rubber products has decreased. The lower prices of palm products in Indonesia, as a result of changes in export duties since September 2011, have diluted KLK’s achieved average selling prices of CPO and palm kernels. Currently, Maybank-IB has a fundamental “hold”  call on KLK with a target price of RM23.50. Our plantation analyst believes that lower plantation earnings in FY13 and FY14 will be offset by contributions from two new refineries in Indonesia with a combined capacity of 1,600 tonnes per day, coming onstream in stages in FY13. These new additions will result in a 1.7% upward revision of the net profit estimates for FY14. Earnings for 4QFY12 will see a one-off RM132 million gain from the sale of Crabtree & Evelyn. A check on Bloomberg consensus reveals that there are 31 other research houses that have coverage on KLK from which there are 10 “buy” calls, 14 “hold” and 7 “sell” calls. KLK is currently trading at  a price-earnings ratio of 17.8 times and an indicated dividend yield of 3.95%. KLK’s share price made an obvious plunge since its weekly Wave 5 high of RM26.76 in January 2012. Since that high, KLK’s chart has moved into daily and weekly downtrends to its recent low of RM20.74. As it surpasses its recent key pivotal support of RM23.14, look to sell KLK on any rallies to its resistance areas as the moving averages depict very obvious short- to medium-term (daily and weekly) downtrend patterns for this stock. The daily and weekly indicators (like the CCI, DMI, MACD and Oscillator) are firmly negative and now depict the obvious indications of KLK’s eventual decline to lower levels. We expect KLK to remain weaker towards its support levels of RM19.30, RM20.42 and RM20.74. It will attract some major profit taking and liquidation at the resistance levels of RM21.52, RM22.10 and RM23.14. Our medium-term technical downside targets for KLK are RM18.55 and RM20.65. This article first appeared in The Edge Financial Daily, on Oct 5, 2012.

https://theedgemalaysia.com/node/73689

Oriental Holdings quarterly earnings jump 87%

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KUALA LUMPUR: Oriental Holdings Bhd achieved a net profit of RM54.7 million, or 8.82 sen per share, for the third quarter ended Sept 30, nearly 87% higher than RM29.3 million, or 4.74 sen per share, a year ago. Revenue, however, dropped slightly to RM740.8 million from RM765 million previously. For the nine-month period, Oriental posted a lower net profit of RM159.8 million (25.77 sen per share) against RM179.7 million (28.97 sen per share) last year. Revenue was down to RM2.06 billion, from RM2.41 billion previously. In a filing with Bursa Malaysia yesterday, the diversified group said its revenue and operating profit from the automotive segment declined by 19.8% and 152.1%. The division was adversely impacted by losses incurred by its auto parts manufacturing and assembly operations, where activity is still recovering from supply disruptions following the calamities in Japan and Thailand last year. Current production has to absorb the high overheads Revenue and operating profit from the plantation segment declined by 15.5% and 34.7%, mainly due to lower fresh fruit bunch (FFB) and crude palm oil production due to climatic factors. “Moving forward, the automotive and plastic segments will continue to contribute to the group’s performance under very competitive market conditions, while the plantation segment will feature significantly in the company’s performance, which will therefore be impacted by the volatility of commodity prices. “FFB production will be subject to the cyclical conditions in part caused by the changing climatic conditions. “The hospitality segment is expected to improve its profitability with added contributions from the latest acquisitions, while the property development and building material segments are expected to perform satisfactorily under competitive market conditions,” Oriental said. This article first appeared in The Edge Financial Daily, on Nov 23, 2012.

https://theedgemalaysia.com/node/11381

Temasek says portfolio falls by a fifth in yr to March

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SINGAPORE: Singapore state investor Temasek said its portfolio slid by at least US$27 billion, or more than a fifth, in the year to March but it will stick with banks and sees opportunities in food and energy, according to Reuters.    The fund saw potential in Asia and Latin America and was comfortable with financial services as its core portfolio holding, despite being hurt by the market meltdown last year after its high profile investments in Western banks, CEO Ho Ching said on Wednesday, July 29.     "At this point, we are still comfortable with the financial sector as a sector that reflects the key economies we are interested in," Ho said at a seminar.     She acknowledged, however, that the increased regulation of the financial sector may result in the rate of returns falling.     "In terms of sectors specifically, we are agnostic, we don't have a sectoral target," she said, adding the fund would look at food and energy but without giving further details.     These were the first public comments by Ho, also the wife of Prime Minister Lee Hsien Loong, after Temasek said last week that Charles "Chip" Goodyear will not become CEO due to differences over strategy.     With 40 percent of its holdings in financials, Temasek's portfolio lost nearly a third in the eight months to November, sparking unprecedented criticism in Singapore about its strategy.     Ho did not give the exact portfolio level as of March 2009.     "In our Temasek Review last year, we reported an annual value-at-risk of almost S$40 billion ($27.8 billion) last March. This meant a 16 percent probability for our portfolio value to drop more than S$40 billion by March this year. Indeed, it has turned out to be so, and more," Ho said in a speech.     Temasek had S$185 billion in assets as of end-March 2008, which fell to S$127 billion as of November 2008.        Goodyear was widely expected to trim Temasek's financial holdings and move aggressively into commodities and energy andinto emerging market infrastructure and consumer retail sectors, analysts and bankers have said.     Ho said Temasek would continue to look at internal and external candidates for her replacement.    Goodyear's departure came less than six months after he was named by Temasek as the sovereign wealth fund's first foreignCEO. He would have replaced Ho on Oct 1.

https://theedgemalaysia.com/node/81581

#US Stocks* Wall St rises on hopes for a budget deal

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NEW YORK (Oct 15): U.S. stocks ended a volatile session with modest gains on Monday, as investors bet that there would soon be a deal in Washington to increase the debt limit, though there were no obvious signs of progress. President Barack Obama was scheduled to meet with several congressional leaders, and while the White House said the meeting had been delayed, signs of negotiations were taken as a positive by the market. Senate Majority Leader Harry Reid and Senate Republican leader Mitch McConnell, who began talks on Saturday, appeared together on the Senate floor and expressed optimism a deal could be made final within days. Stocks had dipped after weekend talks failed to reach a solution that would reopen the federal government and raise the $16.7 trillion federal borrowing limit by Oct. 17. Failure to raise the debt ceiling could leave the world's biggest economy unable to pay its bills in the coming weeks. "Bringing everyone together was enough to get us to come back after opening quite a bit lower, but we're still very much under the assumption that we're at an impasse," said Ralph Bassett, deputy head of North American equities at Aberdeen Asset Management in Philadelphia. "We expect there will be an agreement in the next day or so, but there's a lot of fear." In addition to the debt ceiling, the government shutdown, entering its third week, was seen as a drag on the economy by shaving a small percentage off the GDP with each passing day. In a sign of the market's caution, the CBOE Volatility index , which typically trades inversely to the S&P 500, rose 1.8 percent. Trading volume was low, although that was partially related to the Columbus Day holiday, with banks and the U.S. bond market closed. About 4.77 billion shares changed hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, below the daily average so far this year of more than 6 billion shares. The Dow Jones industrial average was up 64.15 points, or 0.42 percent, at 15,301.26. The Standard & Poor's 500 Index was up 6.94 points, or 0.41 percent, at 1,710.14. The Nasdaq Composite Index was up 23.40 points, or 0.62 percent, at 3,815.28. The day's gains were broad, with eight of the S&P's 10 sectors higher. The two decliners were sectors considered defensive: telecom and utilities. About 55 percent of stocks traded on the New York Stock Exchange closed higher while 59 percent of Nasdaq-listed shares closed up. Investors are also looking ahead to corporate earnings this week, with results from Citigroup Inc, Coca-Cola Co , Johnson & Johnson, and Intel Corp on tap. Market participants are looking to see what kind of impact the issues in Washington have had on results and forecasts. With 6 percent of S&P 500 companies having reported, 55 percent have topped profit expectations, below the historical average. "Earnings have been mixed at best, with revenue growth especially tepid," said Bassett, who helps oversee $312 billion in assets. "By and large, we're focused on companies where earnings growth isn't dependent on GDP being at a certain rate." Shares of Netflix Inc rose 7.8 percent to $324.36, as the S&P's top gainer, after the Wall Street Journal reported that the company is in talks with several U.S. cable television companies, to make its streaming video service available through their set-top boxes. On the downside, Expedia Inc plunged 6.2 percent to $48.51 after Deutsche Bank downgraded it to "hold" from "buy." Appliance maker Whirlpool fell 6.5 percent to $131.29. A note from Cleveland Research pointed to softening demand for appliances.

https://theedgemalaysia.com/node/32577

A good start for SapuraCrest in FY2011

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SapuraCrest Petroleum Bhd (June 28, RM2.27)Recommend outperform at RM2.25 with target price of RM2.90: We like SapuraCrest, given its unleashed prospects. Earnings catalyst will come from (1) active orderbook replenishment; 2) success in new markets; and 3) a growing fleet of strategic assets. Our target price is at RM2.90 with FY2011 earnings per share of 16.9 times and FY2011 price-earnings ratio of 17.1 times. In 1QFY2011, despite a decline in revenue, net profit swelled by 97.5% year-on-year (y-o-y) — thanks to better margins from the installations of pipelines and facilities (IPF), which went up 8.8 percentage points to 12.9% y-o-y, while drilling was up 9.7 percentage points to 39.2% y-o-y. The PCSB Umbrella project win and commendable joint-venture contribution bumped up IPF margins, while improved drilling margins were caused by higher drilling charter rates garnered in FY2010 for T9 and Teknik Berkat. With the orderbook standing at RM9.1 billion, SapuraCrest’s earnings visibility appears to be good, at least for the next two years. However, we learnt that there are risks should installation contracts be delayed, especially if the direction of crude oil prices remains uncertain. Any review of the safety standards of offshore facilities could also potentially escalate cost estimates and affect the viability of new projects. — Inter-Pacific Research Sdn Bhd This article appeared in The Edge Financial Daily, June 29, 2010.

https://theedgemalaysia.com/node/41290

BIG to cancel 80 sen from each RM1 share, plans 2-call rights issue

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KUALA LUMPUR: BIG Industries Bhd plans to cancel 80 sen from the par value of each RM1 shares under its corporate exercise which includes a two-call rights issue of RM76.95 million in loan stocks. It said on Wednesday, Dec 8 the cancellation of 80 sen from each shares would give rise to a credit of RM38.47 million which would be credited to the capital reserves account of the company. “The proposed capital reduction will not result in any adjustment to the share price of the company or the number of shares held by shareholders,” it said. BIG also proposed a renounceable two-call rights issue of up to RM76.94 million nominal value of 4% five-year irredeemable convertible unsecured loan stocks (ICULS) at 100% of the nominal amount of 20 sen each. This would be on the basis of RM3.20 nominal value of ICULS (or 16 ICULS) for every two existing BIG shares held after the proposed capital reduction on an entitlement date to be determined and announced at a later date On the rationale, it said BIG’s shares had been trading below its par value of RM1 per share since February 2007. As at Dec 6, 2010, the closing price of BIG’s shares was 33 sen, which is at a discount of 67% to the par value of BIG’s shares. “The current market price of BIG’s shares is therefore not conducive for BIG to embark on any fund raising exercise and/or corporate exercises involving issuance of new shares. Accordingly, the proposed capital reduction will provide the company with greater flexibility to raise funds and to implement future corporate proposals which entail the issuance of new shares. BIG also said the rights issue would enable the company to have substantial interest savings as the coupon rate for the ICULS of 4% per annum is lower than its existing average cost of borrowings of approximately 4.8% to 8.5% per annum. It added the ICULS would enable the group to fix its cost of funds during the tenure of the ICULS thereby reducing the group’s exposure to any fluctuation in interest rate.

https://theedgemalaysia.com/node/26361

Guan Eng avoids war of words with Zahrain

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GEORGE TOWN: Chief Minister Lim Guan Eng chose to remain mum on the outburst by Parti Keadilan Rakyat's (PKR) Bayan Baru MP Datuk Zahrain Hashim against him. A media report had quoted Zahrain calling Lim a dictator, chauvinist and communist-minded and accused Lim of sidelining the PKR in Penang. He also described Lim as a liability to Pakatan Rakyat and said Lim had reneged on the election promises. Instead of answering the allegations against him, Lim left the task to Deputy Chief Minister Dr Mansor Othman after officiating the Penang International Halal Expo. Mansor, who took over Penang PKR from Zahrain during a reshuffle, however did not say much. "The words were uncalled for and I regret his statement. "That is certainly not the way to address our fellow partners in PR," he said and declined to elaborate further, adding a press conference would be called soon on the matter. A website had also reported a few days ago that a top Penang PKR MP would quit to become a Barisan Nasional-friendly party or even join the new Parti Cinta Malaysia but when contacted via telephone, Zahrain refuted the report as utter rubbish. He told The Edge Malaysia he still was performing his duties as a PKR MP and also as the president of the Football Association of Penang and said the online report was mere speculation. This is not the first time that Zahrain has caused a furore. Last year, he also accused the state government of sidelining PKR with minor portfolios in the state government and had demanded more representation from PKR in government-owned agencies.

https://theedgemalaysia.com/node/40615

City&Country: Cover Story-- Property Man of The Year

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Datuk Alan Tong Kok Mau is renowned for transforming a rubber estate on the fringes of Kuala Lumpur into what is now the thriving international enclave of Mont’Kiara, earning him recognition as “KL’s Condo King”. Before his Mont’Kiara venture, he was involved in politics for more than a decade. The former two-term Bandar Klang State assemblyman was among the first to have a service centre “to serve the rakyat and to listen to their problems”, he tells City & Country with a smile. On the day of the interview, Tong, 75, dashed past the writer into his office in Plaza Mont’Kiara with a vigour belying his age, and looked perfectly composed as we sat down for the interview. Tong is chairman of Bukit Kiara Properties Sdn Bhd, which he co-founded in 2000. He is the first Malaysian to be elected Fiabci (International Real Estate Federation) world president from 2005 to 2006, during which he helped increase Fiabci Malaysia’s international membership five-fold in less than a year, giving its members a greater global reach to network. He was also Fiabci Malaysia president from 1994 to 2002. Since 2006, he has served as the federation’s president for Asia Pacific and chairman of its Pacific Regional Secretariat. He has been actively promoting Malaysia as an international property investment destination, speaking at numerous seminars and conventions at home and abroad. He has also been pushing the Malaysia My 2nd Home Programme (MM2H). Tong, a keen golfer, was also deputy president of the Real Estate and Housing Developers Association (Rehda) from 1994 to 1995. He has received numerous accolades over the years, and at the 18th Malaysia Property Award organised by Fiabci Malaysia on Nov 11, he was bestowed yet another — “Property Man of the Year”. Asked which award means the most to him, he diplomatically answers: “Every award is unexpected.” Tong, who has been a developer for over 40 years, started out as an architect and shares with City & Country how it all started. “I was born in Klang, just 200 yards from Klang High School, into a big family of 13 children. We lived in a 2-storey shophouse, together with some other extended family members. Imagine all of us in a 2-storey shophouse ... how we did it, I am not sure!” he exclaims. His father came from China, was a taxi driver and lived a frugal lifestyle, he says. An example of how frugal his father, says Tong, was that  he would wait and make sure he got passengers for the return trip if he had to send a passenger from Klang to Kuala Selangor. “But he was known to have the cleanest taxi, and it is something my mother proudly took credit for,” he adds. His father went on to buy a few more taxis and later set up a bus company. “I remember following my father from Klang to Kuala Lumpur, I was a little over 10 years old then,  as he had bought an old lorry and wanted to hire a contractor to convert it into a bus. My father spoke only one dialect (Henghua, a subdialect of Fujian province) and it was pretty funny watching these two men communicate in bahasa pasar, but with a handshake, a business deal was sealed. Perhaps that was my initial exposure to business or entrepreneurship,” says Tong. That was the beginning of his father’s bus company, which was eventually taken over by his elder brother, who has since moved to Sydney, Australia. During the Japanese occupation of Malaya from 1941 to 1945, Tong had to relocate to a temporary home and was unable to attend school regularly. He continued his studies at the Overseas Chinese School. Each class, he says, had about 90 students and he fondly recalls his teacher who guided him and a few other students to excel in subjects such as English. Tong, who was active in sports like football, hockey, javelin and tennis, continued his studies in Hobart, Australia, and received an architectural degree from the University of Sydney in 1959. Asked why he chose architecture, Tong admits: “To be honest, I merely fancied the word. I didn’t know what architecture was all about back then. Upon graduating, I thought if I could design some bungalows, it would already be a dream come true for me.” With what he knows now, which educational path would he have taken, given a choice? “It’s all fated, really. If I were really good in architecture, I may never have become a developer,” he quips. After working in Australia for a year, he returned to Malaysia and joined the Architectural Department of the Municipal Council of Kuala Lumpur (now Kuala Lumpur City Hall) on contract for three years. He was involved in building schools and a wholesale market, among other projects. So what did he do when his contract was up? His  matter-of-fact answer is “when you do not have a choice, you create your own curry even though you may not have all the ingredients”. Perhaps it was the entrepreneurial spirit that drove Tong to start his own architectural practice in 1964. “Risk taking, in some ways, is inbuilt, but I was careful at the same time,” he says. Four years later, in 1968, he formed Sunrise Sdn Bhd. “I realised I was helping other people make more money, so I decided to set up Sunrise,” he says. Together with Ngoh Development, a company owned by his father that owned four pieces of land in Klang, Sunrise embarked on its first project, OG Heights in Old Klang Road, in 1984. That was just after Tong quit the political arena. He had become involved in politics in 1972, serving as State assemblyman for Bandar Klang for two 4-year terms from 1974 to 1982, and was also a Selangor State executive councillor. He then focused his attention on OG Heights, a condominium project. Although it was launched at the height of the global recession in the mid-1980s, and there was scepticism about the condominium market, the project was well received. The first block was fully sold within six months, and chalked up RM42 million in sales. Tong moved on to the Cascadium condominium project in Bangsar. It was around this time, in 1989, that a broker approached him to buy a 10-acre tract in Segambut. “I was busy then with Cascadium and Sri Bahagia Court in Cheras so I ignored the offer. The broker approached me again six months later and this time, I decided to just buy it and think about it later. I did not know the 10 acres I bought were part of an old rubber plantation known as Estate of Segambut, which was actually over 100 acres in total,” he recalls. “It is strange how all the pieces of land in the estate literally came to me as people, including some friends, began approaching me to sell me their land and I ended up being the owner of the whole estate. My vision was for a high-rise concept development as there would be no need to flatten the land,” he explains. The rest, as they say, is history. Tong describes OG Heights as a prototype for his venture into condominium development in Mont’Kiara, which earned him the unofficial title of “KL’s Condo King” in the 1990s. He developed the first few condominiums there, with Mont’Kiara Pines completed in 1993, followed by  Mont’Kiara Palma, Mont’Kiara Pelangi, Mont’Kiara Sophia and Mont’Kiara Astana, as well as office-and-retail complex Plaza Mont’Kiara. He later decided to sell his entire stake in Sunrise Bhd, one year after its listing in 1996. “We only said okay after the third offer, and it was just months before the Asian economic crisis. I think the only mistake we did was liquidating the holding company,” he says. Tong and his son N K, whom he refers to as “my junior”, founded Bukit Kiara Properties Sdn Bhd (BKP) in 2000. His son is managing director of BKP, which has since developed high-end projects such as Aman Kiara and  Hijauan Kiara. BKP is currently building the one-of-a-kind Verve Suites in Mont’Kiara, which offers fully furnished units within five towers, each having its own out-of-the-box sky lounges. The latest and last tower, known as Vox Tower, offers Malaysia’s first “beach in the sky”, 37 storeys up in the air. On BKP’s innovative products, Tong says: “They all began as mere ideas, dreams. And they are  definitely significant milestones for the company when they become a reality. I am just glad to be part of it.” Tong cites OG Heights and the opportunity to develop Mont’Kiara “with a free hand to create something out of nothing” as his most cherished moments. He is also proud of BKP’s managing director and the team. “In life, to be successful, one must work for it and be focused. Trust, integrity and honesty are essential traits. In business, and this applies to any type of business, it is most important to gain your customers’ confidence,” he stresses. Hopes of sustainabilityTong’s hope is for the real estate industry and development in the country to be sustainable. “That would be ideal. There should be sustainable competition among developers too. Is it possible? Yes. Do not produce too many properties without careful planning. Supply must meet demand, and meet demand fast. That way, we can discourage speculators.” He welcomes the government’s Greater KL development plans as well as its aspirations to turn Kuala Lumpur into a world-class city. However, “it is essential to ensure plans are carried out in the most efficient and practical way. From my travels, I realise that the biggest problem faced by major cities is always transportation. It must be worked out not only by the authorities but also by the private sector. Yes, it will take time, but it is extremely important. “I am glad the MRT (mass rapid transit) system is in the works. While it will take years to complete, it is also crucial that by then, there is a sufficient population [of MRT users] otherwise it will be running at a big loss. It’s a chicken-and- egg situation,” he notes. “Perhaps along the MRT routes, we should encourage high-rise developments. The city could then afford to talk about higher density buildings as everyone would like to live close to MRT stations, with walkways to ensure a certain comfort level. This calls for in-depth studies. Of  course, with higher density, comes a higher cost of building,” he explains. He adds that before the MRT is completed, there must be an efficient bus system to discourage people from driving in the city. He cites the free trams in Melbourne, Australia, and the free buses in shopping areas in Denver in the US, which translates to less cars on the roads in those cities. “The authorities must quickly make public where the MRT stations will be and (town) planners must identify the allowable density for developments around them. Hopefully, when completed, the MRT can achieve economies-of-scale in construction and operation costs,” he says. This article appeared in City & Country, the property pullout of The Edge Malaysia, Issue 832, Nov 15-21, 2010

https://theedgemalaysia.com/node/79232

OSK slashes JCY results forecast, puts TP at 35 sen

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KUALA LUMPUR (Feb22): OSK Research said it is slashing its results forecasts for JCY International Bhd after the company announced its latest weak results. JCY reported RM33 million core loss in its first quarter financial results 2013 (1QFY13). “We are slashing our financial year 2013 and 2014 core earnings forecasts of RM158 million and RM152 million to a core loss of RM83 million and RM71 million respectively”, the research house said. OSK added that the longer term outlook for the hard disk drive (HDD) sector seems gloomy, given the tepid demand for personal computers as consumers opt for electronic gadgets like smartphones and tablets. In addition, the recent increases in minimum wages in Malaysia and Thailand had not been kind to JCY. It has maintained its "sell" call on JCY International Bhd with a target price of 35 sen. At 3.17 pm, JCY was transacted at 56 sen per unit, down 3 sen, on trades of 3.8 million shares. “Although the company’s 1QFY13 revenue was marginally below our consensus’ full forecasts by about 5%-8%, it registered a core loss of RM33 million versus our consensus’ estimates for core earnings of about RM40 million-RM53 million per quarter”, OSK said. “More worrying is that its 1QFY13 revenue contracted by 30% quarter-on-quarter, pulling its profit margins into negative territory”, it added. The research house noted that this was the first time JCY, which had previously reaped the benefits of a sector recovery following the Thai floods in late 2011, has fallen into the red.

https://theedgemalaysia.com/node/433

KLCI opens lower alongside regional, Wall Street decline

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KUALA LUMPUR: The Kuala Lumpur Composite Index (KLCI) opened 4.4 points weaker alongside regional peers Wednesday morning taking the cue from the overnight losses on Wall Street where investors wailed disappointment over the lack of details on the government’s bailout plan. The KLCI, which opened 4.4 points weaker at 899.12 points, skidded to 895.63 points at 9.36am, down 7.89 points or 0.87% from Tuesday led by losses on planters Sime Darby Bhd and IOI Corp Bhd Sime Darby lost 10 sen to RM5.65 on a volume of 142,000 shares while IOI shed 8 sen to RM3.86 with 486,000 shares done. Only four of the KLCI’s 100 members – Tanjong plc, TSH Resources Bhd, Kulim (Malaysia) Bhd and Star Publications Bhd – had gains to show at 9.25am, albeit on thin trades. Tanjong was up 20 sen at RM13.80, TSH gained 4 sen to RM1.52, Kulim up 5 sen at RM5.35 while Star added 2 sen to RM3.14 on a volume of 6,800 shares. Some 48 of the index components were in the decline, while 48 others were unchanged. Some 43.35 million shares worth RM33.6 million had changed hands just over half and hour into trade. Compugates Holdings Bhd was most active. The stock shed half a sen to 14.5 sen with 4.56 million shares done. Gula Perak Bhd also lost 0.5 sen to 4.5 sen with 4.29 million shares done. Resorts World Bhd is also seeing good interest, fourth on the most active list. The stock added 2 sen to RM2.27 with 2.33 million shares done while Resorts-CI gained 0.5 sen to 7 sen on a volume of 1.47 million shares.   Overnight on Wall Street, the Dow Jones Industrial Average decreased 381.99 points, or 4.62%, to 7,888.88 points while the S&P 500 Index dropped 4.9%, the most since Jan 20, to 827.16 points. Banking stocks like Bank of America and Citigroup Inc skidded after US treasury secretary Timothy Geithner said he is still exploring a range of different structures to rescue lenders. The tech heavy Nasdaq composite index also slumped 4.2% to 1,524.73 points.   The slump on Wall Street “will surely bring out the bears across the region today. In Malaysia, its benchmark KLCI will most likely fall too, possibly challenging to break the first support level of 890 ahead,” chartists at HwangDBS Vickers said in a note this morning.   They are also keeping a watch on the December plantation statistics (that was originally due for release yesterday) on the plantation stocks; likely Cabinet decisions on electricity tariffs cut and highway toll rates increase; and the Dec monthly report for the index of industrial production (which is likely to show another decline, extending the trend of a year-on-year drop of 1.7% in Sept, -2.9% in Oct and -7.7% in Nov).   Major Asian stock averages – Taiwan’s Taiex, South Korea’s Kospi, Shanghai’s Composite Index, Singapore’s Straits Times Index, Australia’s S&P/ASX200 Index, New Zealand’s NZX 50 gross index – are down between 0.88% and 1.75%. Japan markets are closed for a holiday.  

https://theedgemalaysia.com/node/20131

No waiver for MEMS Tech

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However, MEMS Tech said today it was given an extension of time up to March 31, 2010, to submit a regularisation plan to Bursa Securities for approval subject to the condition that MEMS appoint a sponsor and make the relevant announcement by Dec 31, 2009.

https://theedgemalaysia.com/node/74384

Carlsberg creates the right brew

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Carlsberg Brewery (M) Bhd(Nov 30, RM12.56) Maintain buy at RM12.30 with a target price of RM13.70: Top line revenue for Carlsberg’s first nine months of financial year 2012 (9MFY12) grew by a healthy 8.1% year-on-year (y-o-y) to RM1.248 billion. This is mainly due to: (i) a strong 9.8% y-o-y growth in revenue from Malaysia; and(ii) healthy 4% y-o-y revenue growth in Singapore. We attribute this to a series of successful promotions, such as:(a) 2012 Chinese New Year campaign in  the first quarter (1Q);(b) UEFA Euro Cup 2012 consumer campaign in 2Q. Carlsberg was the official global sponsor in the Ukraine and Poland; and (c) the official roll-out of its premium brand Asahi Super Dry in 3Q. Taken together, this has resulted in strong growth in volume sales and better pricing. Earnings before interest and tax (Ebit) margin was relatively stable, up 0.7 percentage points (pps)  to 15.2%. Consequently, 9M core net profit surged by 17.4% y-o-y to RM151.2 million. Results were above our and street estimates, accounting for 82% of our and 83% of consensus full-year forecasts. Carlsberg did not declare a dividend for this quarter. We believe Carlsberg will likely reward shareholders in the next quarter, so we maintain our full-year dividend per share forecast of 65 sen, translating to a lucrative yield of 5.3%. With better pricing and the roll-out of a series of consumer promotions to increase brand visibility for its premium Asahi Super Dry on both the on-  and off-trade markets, Carlsberg’s 3Q Ebit margin grew 6.9 pps to 19.4% and core net profit jumped 62% to RM61.1 million quarter-on-quarter (q-o-q). Furthermore, we gather that its premium Somersby Apple Cider, launched in July, has outperformed management’s target. On a y-o-y basis, Carlsberg’s 3Q revenue increased marginally by 2.3% to RM410.8 million, mainly due to a lower level of trade speculation  against 3QFY11. (Low expectation of an excise duty hike in the recent Budget 2013 against Budget 2012) Notwithstanding the slight increase in revenue, core net profit grew healthily by 25% y-o-y as the group enjoyed a lower effective tax rate of 22% against 3QFY11’s tax rate of 29%. With 9MFY12 core earnings accounting for 82% of our full-year forecast in line with expectation, we make no changes to our earnings projections for FY12 to FY14. This is due to a typical 4Q, which will experience higher operating and marketing expenses as Carlsberg usually ramps up its promotional activities and advertising ahead of Chinese New Year. We continue to like brewery stocks as we believe they offer better values, with attractive dividend yields of 4% to 6% against the market yield of around 3% to 4%. Maintain “buy”, with an unchanged discounted cash flow-derived target price of  RM13.70. — Affin IB Research, Nov 30 This article first appeared in The Edge Financial Daily, on Dec 3, 2012.  

https://theedgemalaysia.com/node/13950

News in brief

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Atrium REIT income up 12% in 1QKUALA LUMPUR: Atrium Real Estate Investment Trust (REIT) saw total income for its 1Q ended March 31 increase 12% to RM3.7 million from RM3.3 million in the previous corresponding period due to the addition of Atrium USJ. Net income rose marginally to RM2.7 million or 2.23 sen per unit from RM2.6 million, while revenue improved 15% to RM4.1 million from RM3.5 million previously.  Atrium REIT’s net asset value per unit remained at RM1.12. The unit closed at RM1.16 on Monday.  Atrium REIT expects its properties to maintain fully tenanted for the year. “The company will continue to actively identify good assets for acquisitions, to improve yield and we will continue to focus on having investment properties leased to reputable tenants for the long-term,” it said in a statement. Globetronics sees revenue plunge in ChinaKUALA LUMPUR: Globetronics Technology Bhd saw its 1Q revenue decline 15.4% from a year ago to RM56.8 million, as revenue from China plunged 93% due to a weak semiconductor market and uncertain macroeconomic outlook. Its operations in Singapore also posted a 16.1% drop in its 1Q revenue, while turnover at its Malaysian operations fell 8.6% to RM44.95 million. Group net profit declined 3.6% from a year ago to RM6.2 million, due to various productivity and cost improvements, as well as a better product mix during the period. Earnings per share fell to 2.31 sen from 2.42 sen. Globetronics said it continued to improve productivity and implement cost control programmes in order to remain competitive. The group is involved in the manufacture, assembly, testing and sales of ICs, chip carrier quartz crystal products, optoelectronic products and various components for the semiconductor and electronics industries. REDtone returns to the blackKUALA LUMPUR: Broadband service provider REDtone International Bhd has returned to the black with a net profit of RM427,000 for its 3Q ended Feb 29, compared with a loss of RM1.9 million in the previous corresponding period. The improvement was mainly due to a RM2.3 million gains from the divestment of REDtone Mobile Sdn Bhd, it said. Meanwhile, group revenue for 3Q rose 13% from a year ago to RM23.6 million, due to higher revenue contribution from its consumer business in China. REDtone said its repositioning in the data and broadband segment had shown “encouraging results”, as the segment now contributes 25% to its total revenue. The company said it will continue to work closely with the government to bid for data and broadband projects, to increase the segment’s contribution from government projects to 50% from 30% presently. This article appeared in The Edge Financial Daily, April 25, 2012.

https://theedgemalaysia.com/node/97155

Cardiff City upset Man City in Premier League

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(Aug 26): Cardiff City celebrated their promotion to the Premier League by defeating Manchester City 3-2 in the biggest upset of the English season so far. In Spain, champions Barcelona maintained their perfect start to the season with a 1-0 win at Malaga while Carlos Tevez scored in his first Serie A game to give titleholders Juventus a 1-0 win at Sampdoria on the opening weekend of the Italian league. - - - - ENGLAND Two goals from Fraizer Campbell handed Cardiff City a shock 3-2 victory over Manchester City on Sunday as the Premier League newcomers celebrated a memorable win in their first top flight match at home in 51 years. At White Hart Lane, a second Roberto Soldado penalty in as many weeks was enough to give Spurs a 1-0 win over Swansea City. On Saturday, Lukas Podolski and Olivier Giroud gave food for thought to Arsenal fans craving a new striker by scoring in a 3-1 win at Fulham while Liverpool made it two victories from two games at Aston Villa. - - - - SPAIN Barcelona survived a couple of second-half scares to secure a nervous 1-0 win at Malaga on Sunday and maintain their perfect start to their title defence. The champions were missing the injured Lionel Messi and struggled to create chances until fullback Adriano cut in from the right and curled a low, long-range shot into the corner moments before halftime. Malaga's teenage forward Fabrice Olinga scuffed a shot against the post and Victor Valdes produced a brilliant save to deny Seba Fernandez late on as Barca held on to make it two wins in two matches. They top the table on goal difference from Atletico Madrid, who thrashed city rivals Rayo Vallecano 5-0 in Sunday's earlier kickoff. Real Madrid, who won their opening game at home to Real Betis last weekend, play at Granada on Monday. - - - - ITALY Carlos Tevez scored in his first Serie A game to give titleholders Juventus a 1-0 win at Sampdoria on the opening weekend of the league season. Napoli beat Bologna 3-0 on coach Rafael Benitez's debut and there were also winning starts for Rudi Garcia at AS Roma, who won 2-0 at Livorno, and Walter Mazzarri, whose Inter Milan beat Genoa 2-0. AC Milan were less fortunate as they slumped to a 2-1 defeat at promoted Hellas Verona, with veteran Luca Toni scoring both goals for the hosts. - - - - GERMANY Franck Ribery and Arjen Robben struck as Bayern Munich eased past Nuremberg 2-0 to maintain their perfect start to the season and join Borussia Dortmund, Bayer Leverkusen and Mainz 05 with maximum points from three games at the top of the table. Borussia Dortmund beat Werder Bremen 1-0, Leverkusen beat Borussia Moenchengladbach 4-2 and Mainz 05 beat VfL Wolfsburg 2-0. Schalke 04, fourth last season, are among the six teams without a win after they were beaten 2-1 at Hanover 96. Eintracht Frankfurt got off the mark with a 2-0 win at pointless Eintracht Braunschweig and Augsburg opened their account by beating VfB Stuttgart 2-1. - - - - FRANCE Goals from Paris St Germain's South American duo Edinson Cavani and Ezequiel Lavezzi led the French champions to a 2-1 victory at promoted Nantes on Sunday. PSG, who drew their opening two games, have five points from three matches, and are four points behind arch rivals Olympique Marseille who continued their perfect start to the season with a 1-0 win at Valenciennes on Saturday. - - - - NETHERLANDS Surprise package PEC Zwolle kept up their 100 percent start to the season when Guyon Fernandez and Rochdi Achenteh scored in a 2-0 home triumph over Cambuur Leeuwarden. A fourth successive victory moved PEC two points clear at the top of the table while PSV Eindhoven's winning start was halted by a 1-1 draw at Heracles Almelo where Park Ji-Sung marked his return with an 86th-minute equaliser for the visitors. Graziano Pelle scored a hat-trick as Feyenoord ended their worst start of three successive defeats by earning their first points with a 3-1 home victory over NAC Breda. - - - - SWITZERLAND FC Sion were still waiting for their first league goal of the season after completing their sixth game on Sunday, setting a new record for the Swiss Super League with a 0-0 draw against FC Thun. Previously, the longest any team has had to wait for their first goal was 529 minutes endured by Neuchatel Xamax in 2011/12. Leaders Young Boys dropped their first points when they were beaten 2-1 at home by Grasshoppers after Brazilian Caio scored an 86th minute winner. - - - - AUSTRIA Salzburg striker Jonathan Soriano took his tally to eight goals in six games when he converted a penalty to give the Austrian Bundesliga leaders a 1-0 win over Admira Wacker. Salzburg, who have 14 points, stayed one clear of promoted Groedig who pulled off their biggest upset yet by winning 1-0 at Rapid Vienna. - - - - GREECE Olympiakos Piraeus maintained their 100 per cent start to the defence of their Super League crown on Sunday after coming from behind to compete a 2-1 home success against Atromitos Athinon. The win ensured they moved two points clear ahead of three teams on four points. - Reuters

https://theedgemalaysia.com/node/78507

Buying a piece of London's history

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BATTERSEA Power Station, with its 300ft-high high chimneys, is one of London's most enduring landmarks. It will receive a new lease of life under its new Malaysian owners, a consortium made up of property developers, S P Setia and Sime Darby, as well as the country's national provident fund, the Employees Provident Fund. The joint-venture company for the project is called The Battersea Power Station Development Co. The Malaysian group has proposed an £8 billion ($15.7 billion) mixed-use development on the 40-acre site master-planned by world-renowned Rafael Viñoly. When completed, the project will have more than 3,400 residences, close to 700,000 sq ft of retail and F&B space, and more than 1.7 million sq ft of office space, as well as hotels, leisure and entertainment facilities. The first phase of the Battersea Power Station redevelopment will be launched for sale in a series of international road shows — starting with London on Jan 10, Singapore on Jan 17 and Hong Kong the week after. The project had previewed in Malaysia in late December, and response was said to be strong. In Singapore, more than 10 units have already been reserved in the lead-up to the launch at St Regis Hotel next weekend, says Doris Tan, Jones Lang LaSalle's director of international property services, the exclusive marketing agent for the project. The first phase of the project, called Circus West, contains a total of 850 residences, with a mix of studios, one-, two- and three-bedroom apartments, as well as townhouses and penthouses. Prices start from £338,000 for a studio unit to £894,000 for a three-bedroom apartment. Penthouses with direct views of the River Thames are said to have price tags of up to £6 million. Besides residences, Circus West, which is targeted for completion in 2016, will also comprise offices, shops, leisure facilities and a hotel. There will be guest suites, for lease exclusively to residents who need additional room for house guests. The project will include large public open spaces and a six-acre riverside promenade, providing access to Battersea Park and Chelsea via the River Thames Walk. "Chelsea is just across the river, and properties there are priced at £3,000 psf," says JLL's Tan. "At Battersea, you're buying an apartment at £1,000 to £1,200 psf. That's the attraction." Currently, the nearest underground station is the Vauxhall station less than a 10-minute walk away, according to JLL. With the proposed Northern Line Extension, there will be two new underground stations, namely Nine Elms and Battersea Stations, which will link the Battersea Opportunity Area to the City and West End via Kennington Station, which is expected to open by 2019. The Battersea project is located within the Nine Elms Opportunity Area, the largest regeneration scheme in London. The Battersea Power Station was designed in the 1920s by Sir Giles Gilbert Scott, who also designed London's famous red phone box. The power station was operational from 1933, and shut down 50 years later. In 1980, it was designated a listed building. Over the last three decades, there have been various proposals to revive the 38-acre site. These included proposals to turn it into Europe's largest leisure complex in the 1980s, the world's largest multiplex cinemas in the 1990s, and Parkview International of Hong Kong's master plan to redevelop it into a massive mixed-use scheme in 2004. Last year, the property was placed into administration, and put up for sale by the administrators, Ernst & Young. Chelsea Football Club and its owner Roman Abramovich had reportedly submitted plans to turn the site into a new 60,000-seat stadium. However, the administrators endorsed the proposed plan by the Malaysian consortium, which submitted a bid of £400 million for the site. The consortium will also start the regeneration of the derelict power station, which has lain dormant for close to 30 years. Most of the interested buyers are looking at the opportunity of buying into a landmark scheme, which is very rare, observes Tan. "This is one of London's most iconic projects," she adds. Tan reckons investors can expect gross rental yields in the 4% to 5% range. This story first appeared in The Edge Singapore weekly edition of Jan 14-20, 2013.

https://theedgemalaysia.com/node/33884

Off-Market Trades

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Some 60 million Genting Malaysia Bhd shares worth RM168 million were traded in block and cross trades at RM2.80 each for the week of June 17 to 23. The casino operator’s unit Genting New York LLC has paid a US$1 million entry fee to the New York Lottery. This will allow the company to participate in the bidding process to develop and operate a video lottery facility in New York. However, Genting New York has until June 29 to decide whether to “formally submit a bid” for the video lottery business. Newly listed Shin Yang Shipping Corp Bhd also saw 60 million shares worth RM66.12 million transacted in block and cross trades at RM1.10 apiece. The company, which made its debut on Bursa Malaysia on June 23, expects its revenue to grow by up to 15% in FY2011 (ending June 30) as it builds more vessels and expands its local and foreign shipyards. Some 22.71 million Johore Tin Bhd shares valued at RM12.15 million changed hands during the week. The shares were done in direct and cross deals at 53.5 sen apiece. Parkson Holdings Bhd saw 20 million shares worth RM10.97 million transacted at RM5.47 to RM5.57 each in block, direct and cross trades. The retailer hopes to grow revenue by over 20% this calendar year as it opens new stores in Malaysia and abroad. Some 14.47 million Public Bank Bhd shares worth RM168.85 million changed hands during the week. The shares were transacted at RM11.66 to RM11.90 apiece. As at March 31, Public Bank’s foreign shareholding was about 26.3%, according to updates to Bursa. Some 18 million shares in Tejari Technologies Bhd worth RM5.04 million were transacted in block and cross trades at 28 sen each. The hydraulic systems maker recently appointed non-exclusive agents in China and Taiwan to expand its business abroad. UOA Real Estate Investment Trust (UOA REIT) saw 20.73 million shares valued at RM28.2 million change hands at RM1.36 each in block and direct deals. The REIT plans to acquire Parcel B of Menara UOA Bangsar and Wisma UOA Damansara II in Kuala Lumpur from UOA Holdings Sdn Bhd, a major shareholder of UOA REIT, for RM289 million and RM211 million respectively. YTL Power International Bhd saw 56.55 million shares worth RM107.16 million traded in block and cross deals at RM1.892 to RM1.898 a share. YTL group managing director Tan Sri Francis Yeoh said the group was looking for opportunities in Asia to expand the utility business, including electricity generation and water treatment operations. Some 9.11 million Talam Corp Bhd shares worth RM1.17 million changed hands in block trades at 12.5 to 13 sen each. The company, which has been out of the Practice Note 17 category since June 10, had previously announced the resignation of non-executive director Lee Swee Seng, 50. It also announced the appointment of Ng Bee Ken, 56, as a non-executive board member. Some 9.84 million shares in SMR Technologies Bhd worth RM689,000 changed hands at seven sen each in block and direct deals. The company completed a private placement involving 13.33 million new shares in the company in February. Malaysian Pacific Industries Bhd saw 6.52 million shares valued at RM27.62 million traded at RM6.40 apiece in block and cross deals. The chip maker said last March that an administrative law judge in the US had issued a supplemental initial determination (ID), which indicates that Malaysian Pacific had not violated  intellectual property infringement rules by importing micro leadframe package products as claimed by Amkor Technology. The judge’s supplemental ID will be reviewed by the International Trade Commission, which is scheduled to render a final determination by July 20. This article appeared in Capital page, The Edge Malaysia, Issue 812, Jun 28-Jul 4, 2010

https://theedgemalaysia.com/node/34042

Carlsberg to distribute Asahi beer

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Carlsberg Brewery Malaysia Bhd July 22, RM5.04Maintain buy at RM5 with target price of RM5.30: Through 70%-owned subsidiary Luen Heng F&B Sdn Bhd, Carlsberg now holds the right to distribute and market all Asahi beer brands and  products in Malaysia beginning this month. Carlsberg expects to drive sales of Asahi beer via its distribution network. Distribution will be centred on on-trade (hotel, restaurant, café) and off-trade (supermarkets) channels. Although Asahi beer commands a small market share of less than 1% in Malaysia, Carlsberg intends to expand the brand’s presence by leveraging the group’s distribution network. The move will benefit both Carlsberg and its Japanese partner Asahi Breweries. Carlsberg will  expand its brand coverage to compete with market leader Guinness Anchor while Asahi gets to grow its presence in Malaysia. Available at premium pricing at both on-trade and off-trade channels, Asahi will be priced on par with other premium beers such as Hoegaarden  and Kilkenny. Pricing may well be some 20% to 38.5% (as per its price at Cold Storage) higher than standard lagers such as Tiger and Carlsberg’s Green Label at off-trade channels while those at on-trade channels will be priced at the respective outlets’ discretion, although still at a premium. The newly-acquired rights came with the introduction of three new stock-keeping units. Apart from the typical 330ml cans, 330ml bottles and larger 640ml bottles, the collaboration will also see the introduction of a new 135ml can, enlarged one-litre can and also a two-litre giant-sized can. Excluding the larger one and two-litre cans, which are currently only available at duty-free outlets, the other variants are available at all distribution channels. In view of the smallish market share of Asahi beer brands in Malaysia, there should be no major earnings impact on Carlsberg. Nonetheless, the inclusion of Asahi into Carlsberg’s brand portfolio will certainly be a boost since the Asahi brand can now leverage on Carlsberg’s distribution network. Furthermore, Asahi is a brand familiar to the Malaysian market, being widely known in Japanese restaurants and AEON’s Jusco supermarkets. — OSK Research, July 22 This article appeared in The Edge Financial Daily, July 23, 2010.

https://theedgemalaysia.com/node/22011

Liow pitches Nov 28 EGM to central delegates

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KUALA LUMPUR: MCA central delegates should not be afraid to attend the extraordinary general meeting (EGM) planned for Nov 28, as it is legal and in accordance with party constitution, said MCA vice-president Datuk Seri Liow Tiong Lai. "I hope certain quarters will respect the rights given to the delegates to hold EGM. This is the best way to solve the internal crisis," he told a press conference at parliament lobby today. Also present were Youth chief and Deputy Education Minister Datuk Dr Wee Ka Siong (Ayer Hitam), Deputy Finance Minister Datuk Chor Chee Heung (Alor Setar), Deputy Youth and Sports Minister Wee Jeck Seng (Tanjong Piai), Deputy Minister of Higher Education Dr Hou Kok Chung (Keluang), Datuk Seri Ong Ka Chuan, Tan Ah Eng (Gelang Patah), Teng Boon Soon (Tebrau) and Wanita chief and Women, Family and Community Development Deputy Minister Datin Paduka Chew Mei Fun. Liow reiterated that Article 30.2 of the MCA constitution allows for one-third of the central committee to call for an EGM. "Everything is valid. It is safe, constitutional and legitimate to attend the EGM," said Liow. Wee revealed that party president Datuk Seri Ong Tee Keat had wanted the central committee to vote against the Nov 28 EGM, which was called by 16 central committee members during its meeting last week. Ka Chuan, a former party secretary-general, said an EGM was a platform for the delegates to discuss anything as well as a forum to seek political solution. "In EGM we can discuss anything. Sometimes the decision is legally binding, sometimes it's just political moral only. In this case, we want to see the aspiration of the delegates," he said in open support for Liow. Meanwhile, Liow confirmed that he had written to the Registrar of Societies (ROS) in his capacity as deputy president to seek clarification on that position.

https://theedgemalaysia.com/node/84557

#Update* Zecon clinches RM495 million Sarawak hospital job

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KUALA LUMPUR (April 26): Zecon Bhd has clinched a RM495 million job to build the Petra Jaya Hospital in Kuching, Sarawak. In a statement to the exchange today, Zecon said the builder has received the Letter of Award for the 42-month project from Jabatan Kerja Raya (Public Works Department). "The said project is not expected to have any material impact on the earnings, net assets, share capital and substantial shareholders’ shareholdings of Zecon for the financial year ending 30 June 2013. "However, it is expected to contribute positively to the company’s consolidated net assets and earnings in the subsequent financial years,"  Zecon said.

https://theedgemalaysia.com/node/41582

Naza brothers exit Jetson board

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KUALA LUMPUR : A year after making a grand entrance into Kumpulan Jetson Bhd, the Naza Group brothers, Sheikh Mohd Nasarudin Sheikh Mohamad Nasimuddin Kamal and Sheikh Mohd Faliq Sheikh Mohamad Nasimuddin Kamal, have exited the construction company, a move that the market had anticipated for some months now. In a statement to Bursa Malaysia yesterday, Jetson announced that Nasarudin and Mohd Faliq had resigned from their board memberships. Both Mohd Nasarudin and Faliq who, via private vehicle Superior Pavillion Sdn Bhd, acquired a controlling 33.15% stake in Jetson in August last year also reduced their stakes in Jetson after disposing of 4.38 million shares or 7.2% of the company last Wednesday. Following the sale, Superior Pavillion still owns 21.7%. Datuk Teh Kian An, the managing director of Jetson, is believed to have acquired the 7.2% stake from the brothers based on the similarity in the transaction figures for the changes in the company’s shareholdings announced to the exchange. According to sources, the transaction supposedly between the Naza brothers and Teh indicates that their departure from Jetson is in an amicable manner.“There really is no problem between the Naza brothers and Teh. It’s an amicable departure,” said a source.    When Nasarudin and Faliq, who are the sons of Naza’s late founder Tan Sri SM Nasimuddin SM Amin, bought into Jetson last year, the company was widely perceived as the construction entity to accommodate privately-owned Naza’s property projects. Among the property development projects under the stable of Naza Group are the Platinum Park project located in the vicinity of KLCC and the Matrade Centre off Jalan Duta.     Following their entry into Jetson, Nasarudin and Faliq were appointed executive board members, holding the posts of chairman and vice-chairman, respectively, in November last year. Another former Naza employee, Chow Chee Kin, was also appointed executive director of Jetson. Chow was formerly the group chief financial officer of Naza Motor Trading Sdn Bhd. However, by the middle of this year, speculation was rife that all was not well within the Jetson board, specifically, between the Naza brothers in one camp and another group led by Teh. This was followed by the termination of joint ventures for property development projects involving Naza and Jetson due to disagreements on payment terms and project costs. In October this year, Nasarudin and Faliq were redesignated as non-executive directors from their executive positions. The exit of Chow from Jetson was less amicable. A faction led by Teh initiated a requisition notice for an extraordinary  general meeting to remove Chow. The brothers did not turn up for the EGM and Chow was eventually removed from the board  on Oct 29. Shares of Jetson rose one sen to close at 99 sen yesterday. This article appeared in The Edge Financial Daily, December 14, 2010.

https://theedgemalaysia.com/node/74197

#Focus* Petronas' 3Q profit falls 22% as tough conditions hurt

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KUALA LUMPUR (Nov 29): Petroliam Nasional Bhd (Petronas) flagged tougher operating conditions and lower 2012 full-year profit today when reporting that third quarter net profit had fallen 22% year-on-year to RM12.44 billion. "To what extent [2012 profits will be] lower, we'll know in the fourth quarter but we're pretty sure it's going to be lower than last year," Petronas executive vice president (finance) Datuk George Ratilal told reporters at a briefing today. "Margins are trending down from 44.5% to 36.4%," he added. Net profits for the third quarter ended Sept 30, 2012, fell to RM12.44 billion from RM15.94 billion in 3Q11 on the back of a 4.9% slide in revenue to RM68.34 billion from RM71.84 billion due to lower realised prices and sales volume for crude oil. The tougher operating conditions hit margins, causing earnings for the first nine months of 2012 to fall to RM43.42 billion from RM45.88 billion in the same period last year. Earnings declined despite an increase in revenue to RM214.21 billion from RM210.43 billion. Other than the tough operating and geopolitical challenges, Petronas' president and group CEO Tan Sri Shamsul Azhar Abbas said the Fortune 500 company continues to forgo sizable revenue due to the government-mandated gas prices, which are much lower than market prices. "What was meant to be a reprieve during the downturn continues today at Petronas' expense," Shamsul said, pointing out that Petronas has forgone some RM155 billion in revenue and sizable profits since regulated gas prices came into effect in May 1997.

https://theedgemalaysia.com/node/54072

Ringgit closes lower against US dollar

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KUALA LUMPUR (Dec 17): The ringgit closed lower against the US dollar today, on lack of buying interest for the local currency, amid the absence of fresh market leads, dealers said. At 5pm, the ringgit was quoted at 3.2455/2485 to the US dollar, compared with 3.2375/2405 yesterday. A dealer said traders were concerned about the outcome of the Federal Open Market Committee meeting, and this has weighed on the market's risk appetite. "The ringgit remains under pressure, on concern about the US quantitative easing tapering speculation," it said. Meanwhile, the ringgit depreciated against the Singapore dollar to 2.5824/5849, from 2.5762/5806 on Monday, and declined against the yen to 3.1534/1566, from 3.1389/1431 yesterday. The domestic currency was traded lower against the British pound at 5.2996/3058, from 5.2852/2904 yesterday, and decreased against the euro to 4.4694/4742, from 4.4592/4573 on Monday.

https://theedgemalaysia.com/node/70513

Noon KLCI ends at 1,659, after hitting record high of 1,661.79

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KUALA LUMPUR (Oct 4): The FBM KLCI made a comeback from yesterday's (Wednesday) volatile trading to reach a record high of 1,661.79 during the mid-morning session, rallied by gains from index-linked banking and plantation stocks and renewed speculations that the general election will be held soon. At midday break, the FBM KLCI was up 9.46 points at 1,659.21 points, with 319 gainers versus 251 losers and 319 stocks unchanged. Volume traded was 456.08 million shares valued at RM674.58 million. At 10.38am, the FBM KLCI charged to record high of 1,661.79 before softening slightly. According to Inter-Pacific Securities head of research Pong Teng Siew, the market was rallied by the participation of institutional funds buying up banking stocks and blue chips like Tenaga Nasional Bhd. "As I've mentioned before, one of the requisite conditions to lift the markets to new highs is the participations of banking stocks and today, we saw stocks like CIMB and Hong Leong Bank achieving some gains," Pong said. Other notable blue chip stocks that helped push the key index to the new high were Petronas Dagangan Bhd, British American Tobacco Malaysia Bhd (BAT) and Shell Refining Co Bhd. Pong added that plantation companies like Kuala Lumpur Kepong Bhd (KLK) and Sime Darby Bhd also rebounded after crude palm oil prices (CPO) made a strong recovery this morning and yesterday. "Plantation stocks make up a big part of the KLCI, so their comeback this morning also helped lift the market to the new record high," he said. Meanwhile, president of the Remisiers' Association of Malaysia Sam Ng said he believes another factor causing today's market rally was election talks. "There is an election fever right now and I think that could be a catalyst as well," Ng said. Bernama reported that the sterling market's performance this morning was due to government efforts to reduce the country's budget deficit. "The strong performance of the local market, despite external headwinds, is due to the government's efforts in reducing the country's budget deficit to 4% of gross domestic production (GDP) in 2013 from the current 4.5%," Bernama said. In today's edition of The Edge Financial Daily, Prime Minister Datuk Seri Najib Razak was reported to have highlighted the possibility of a budget surplus for Malaysia after 2016. Asian shares steadied on Thursday and the safe-haven dollar eased after positive US data, leaving investors waiting for more economic indicators from the world's largest economy later in the day and a European Central Bank policy meeting, according to Reuters. Most other major Asian indices — with the exception of the Singapore Straits Times Index — gained between 0.01% to 1.12% at midday.

https://theedgemalaysia.com/node/69099

Limited gains at mid-day for KLCI

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KUALA LUMPUR (Sept 18): The FBM KLCI pared some of its gains at the mid-day break on Tuesday, in line with the pause in the rally at regional markets. At 12.30pm, the index was up 2.07 points to 1,645.02, lifted by select blue chips including Maybank, DiGi and Petronas Gas. The FBM KLCI had earlier climbed to its intra-morning high of 1,651.66. There were 303 gainers and 309 losers, while 273 counters traded unchanged. Volume was 437.43 million shares valued at RM867.81 million. The ringgit fell 0.43% to RM3.0598 versus the US dollar; crude palm oil (CPO) futures for the third month delivery dropped 4.05% or RM121 per tonne to RM2,865; crude oil gained 26 US cents per barrel to US$96.88 (RM296.40); while gold lost US$5.20 an ounce to US$1,756.25. Asian shares retreated from four-month highs on Tuesday while gold and copper eased, as markets calculated the impact on growth from the Federal Reserve's aggressive stimulus and eyed whether Spain will request a bailout to ease its fiscal strains, according to Reuters. Concerns about the growth slowdown in China, the world's top consumer of raw materials and the second-largest economy, also weighed on sentiment as investors took profits from last week's rallies, it said. At the regional markets, Japan's Nikkei 225 was down 0.18% to 9,143.35; Hong Kong's Hang Seng Index shed 0.07% 20,644.50; the Shanghai Composite Index was down 0.64% to 2,065.26; Taiwan's Taiex fell 0.30% to 7,738.73; Singapore's Straits Times Index lost 0.18% to 3,073.10; while South Korea's Kospi rose 0.08% to 2,004.02. Among the gainers in the morning session on Bursa Malaysia, Panasonic rose 30 sen to RM22.50; Petronas Gas was up 26 sen to RM19.22; PPB jumped 20 sen to RM12.50; KLCCP grew 19 sen to RM5.69; Aeon added 18 sen to RM10.58; Milux increased 17 sen to RM1.15; Tradewinds Corp advanced 14 sen to RM1; Ipmuda surged 12.5 sen to 79 sen; MMHE gained 12 sen to RM4.87; GCE climbed 11.5 sen to 90 sen; Maybank rose five sen to RM9.45; and DiGi added four sen to RM4.94. AirAsia was the most actively-traded counter, with 21.86 million shares done. The stock fell eight sen to RM3.02. Other actives included Asia EP, Scomi, Maybank, YTL Corp, Astral Supreme, DiGi, SYF Resources and Asia Media. Decliners included Nestlé, BAT, Petronas Dagangan, F&N, KLK, Sarawak Oil Palms, Choo Bee, Kulim and Hong Leong Bank.

https://theedgemalaysia.com/node/58738

A Chinese buyer for Lotus?

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KUALA LUMPUR: Market talk is rife that a corporate exercise could be brewing to hive off Proton Holdings Bhd’s Group Lotus plc. “There are interested suitors for Lotus and one of them is a party from China,” said a source. In October, Proton managing director Datuk Syed Zainal Abidin Syed Mohamed Tahir dismissed speculation that the company was selling its stake to Genii Capital, which owns the Renault Formula One (F1) team that has Lotus as its title sponsor for the event. “There are no plans or discussions about Proton selling a stake in Lotus, this is just speculation,” said Syed Zainal two months ago in October. Lotus CEO Dany Bahar said then that the company’s involvement with the Renault F1 team was “the start of a close relationship” though Gerard Lopez, head of Genii Capital, did not rule out further involvement with Lotus. “I think they have a good shareholder with Proton. For sure, that is something also that we will be looking at, but its not anything urgent,” he said in an interview with a local media outlet. Nevertheless, it seems rumours that Proton could see the sale of Lotus continue to swirl around the national carmaker. Industry observers believe that the severance of Lotus from Proton is expected to provide a cleaner slate for a new entrant to implement improvements. This is amidst market chatter of Khazanah Nasional Bhd seeking interested buyers for its 42.7% stake in the national automaker. “Proton is continuing with major losses from Lotus, its cash resources and bottom line financials are dwindling as a result. The disposal of Lotus would provide a much needed reboot,” said a market observer. Expenses incurred on Lotus have weighed heavily on Proton’s earnings. Proton is in the second year of its five-year turnaround plan for Lotus, which has been estimated to cost £480 million (RM2.4 billion). Despite continuing losses from Lotus, Proton has been adamant over its vision and has constantly reaffirmed that it will achieve break-even for  Lotus by 2014. Most recently, net profit for Proton’s second quarter ended Sept 30 fell 76% to RM15.6 million from RM65.9 million a year ago, while its half-year earnings dropped 86.6% to RM20.1 million from RM150 million. The lower profit was largely attributed to higher expenses incurred by Lotus, in line with Proton’s efforts to achieve Lotus’ long-term business transformation plans. Proton said the higher expenses incurred for Lotus were partially offset by an increase in the carmaker’s domestic sales volume, which was 2% higher year-on-year 1HFY12. As at Sept 30, Proton had RM1.31 billion in cash, bank balances and deposits alongside RM959.1 million in total borrowings. In 1QFY12 ended June 30, Lotus registered a net loss of £14 million driven by high operating costs. It is interesting to note that Proton opened its first Lotus showroom in China recently. “We need to seize the opportunity now. Before this, Lotus relied on Europe, the US and Japan for sales but China is now the biggest market for cars globally. The Chinese appetite for luxury brands is very strong and they are willing to spend to be different,” said Syed Zainal in October. In 1996, Proton paid £38 million for a 63.75% stake in Lotus Group International Ltd, which owns 100% of Group Lotus plc. Market talk of Proton selling Lotus first surfaced in 2000. At the end of December 2007, there were reports that a Malaysian automaker had approached Proton on the sale of the Lotus brand. Later in 2009, there was talk that Proton was on the lookout for new investors for Lotus. It was said to be seeking a “new long-term equity partner” for Lotus, with an information memorandum drawn up and furnished to potential local and international bidders who were keen to participate. Following that piece of news, Syed Zainal said in July 2009: “We have no plans to sell Lotus at all. There might be interest somewhere out there but as of now, that is not a possibility. We want to exploit Lotus even more, we want to strengthen Lotus from what it is today and look at what we can do”. If Proton divests its interest in Lotus, it will be the second major divestment following its sale of a 57.7% stake in MV Augusta for one euro (RM4.14) in 2006. This article appeared in The Edge Financial Daily, December 19, 2011.

https://theedgemalaysia.com/node/10008

BCHB to set up ‘bad bank’

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“We currently have an internal bad loans department that will be corporatised to manage our regional bad loans,” he said. Nazir said the bad loans were mainly from its Malaysian operations, but the “bad bank” would also manage NPLs from its Thai unit, CIMB Bank Thai. CIMB also has a banking unit in Indonesia but most of the bad debts from this unit, CIMB Niaga, had been sold and hence that bank’s bad loans would probably not be injected into the “bad bank”, Nazir added. He said the regional “bad bank” would either sell or restructure the loans and BCHB would consider bringing in strategic partners as investors in the bank. “They could just be passive investors looking to make good money,” he told reporters on the sidelines of Invest Malaysia 2009 here yesterday. The idea of a “bad bank” as practised in some western countries is to absorb bad debts from banks to free them from the job of managing these debts and also strengthen their balance sheet. Nazir said the initial size of the bad loans injected into the bank would be RM1.1 billion, which had been written down from a legally claimable sum of between RM10 billion and RM11 billion. At BCHB’s corporate presentation to investors at yesterday’s conference, Nazir said the “bad bank” would reduce the group’s net NPL ratio to 1.8% from 2.8%, and improve loan-loss coverage to 99.7% from 83.2% currently. The banking group also unveiled yesterday its plan to position itself as Southeast Asia’s leading universal bank to achieve long-term growth. “Our priority now is to go regional. We have invested overseas but never articulated the strategy clearly before,” he said. Nazir said while growth in the near-term would be driven by the Malaysian CIMB Group and its consumer banking business, growth in the medium-term would be driven by its regional presence. Noting that its Malaysian operations contributed 71% to total revenue currently, he expected the Indonesian operations to take over as the largest contributor to the group’s top line by 2014. “We’ve spent RM18 billion on acquisitions over the past three years and are done with major acquisitions for now, although we will consider making bolt-on acquisitions, such as of small brokerages, to complete our franchise,” he said. Among strategies to strengthen its regional presence are to step up the operations of its Singapore consumer banking operations under CIMB GK, drawing corporate and investment banking deal-flows in Indonesia and completing a five-year transformation strategy in Thailand by 2013 with focus on wholesale banking, Nazir said. On the local front, CIMB Group would undertake measures including strengthening its sales and service platform and branch rationalisation, he said. Nazir said by 2010, BCHB aimed to achieve, among others, a return on equity of 18%-20%, drawing more than one-third of its assets and revenues from its non-Malaysian operations and to be the largest bank in Southeast Asia. On its China venture via Yingkou Bank, he said its growth prospects were “strong” and that its stake in the bank was “a cheap way of getting to know China”. On capital raising, Nazir said BCHB was “more or less done” with such exercises, with its latest efforts bringing tier-1 capital to 12% and risk-weighted capital ratio close to 14%, a level he described as “comfortable and competitive”. This article appeared in The Edge Financial Daily, July 2, 2009.

https://theedgemalaysia.com/node/89848

S’pore shows how to crack down on bubble

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SINGAPORE, the city-state that banned chewing gum to curb litter, is showing the rest of Asia how to cool a housing bubble. The government this year ramped up efforts to bring down property prices that surged to a record, adopting some of its strictest measures, including a cap on debt at 60% of a borrower’s income, higher stamp duties on home purchases and an increase in real estate taxes. The combination and timing of the curbs is the most comprehensive among governments battling housing bubbles, according to Vishnu Varathan, an economist at Mizuho Bank Ltd. The curbs are proving more successful than in Hong Kong and China where policymakers have experimented with a variety of initiatives to temper soaring housing markets. Home prices in Singapore have gained 33% since 2009, while they have more than doubled in Hong Kong in the period. “The government has enacted all these measures quite early,” Vikrant Pandey, a Singapore-based analyst at UOB Kay Hian Pte, the securities unit of Southeast Asia’s third largest lender, United Overseas Bank Ltd, said. “They want to contain a bubble from reaching levels where it brings down the whole system.” Home prices in Singapore had the slowest growth in six quarters in the three months ended Sept 30. Sales declined and mortgage growth fell to 13% in July from 18% two years ago. The city-state began introducing curbs four years ago after home prices climbed 25% in the two years to 2008. The government of Prime Minister Lee Hsien Loong intensified efforts as prices jumped a further 40%, driven by low interest rates, demand from local Singaporeans to upgrade from government to private housing, as well as buyers from China and Southeast Asia. Tighter lending The gains led to Singapore being ranked the most expensive city to buy a luxury home in Asia after Hong Kong by property broker Knight Frank LLP in a wealth report in March. Shanghai was ranked third and Beijing fourth in the report as at the fourth quarter of 2012. The average price of a new 1,000 sq ft condominium is between S$1 million (RM2.55 million) and S$1.2 million, according to London-based broker Savills plc. In Hong Kong, where prices have more than doubled since early 2009, the average for a similar size apartment is between HK$8.1 million (RM3.3 million) and HK$12.8 million, according to Midland Holdings Ltd, the city’s biggest realtor. Residential buildings in the Grange Road area of Singapore. Home prices had the slowest growth in six quarters in the three months ended Sept 30. Sales declined and mortgage growth fell to 13% in July from 18% two years ago. Payments capped In Singapore, the government raised the minimum down payment on second home purchases, brought in new taxes for foreign and corporate buyers, and added a stamp duty for all residential properties. The Monetary Authority of Singapore said on June 28 that home loans should not exceed a total debt-servicing ratio of 60%. In August, the central bank then cut the maximum period for new loans to buy public housing, where about 80% of Singaporeans live, by five years to 25 years. Mortgage payments were capped at 30% of gross monthly incomes, down from 35%, according to the Housing and Development Board. “The loan measures are more lethal than the other measures,” said David Neubronner, national director of residential project sales in Singapore at broker Jones Lang LaSalle Inc. “Home prices will remain flat for the next six to nine months.” The restrictions are already deterring potential buyers such as Jeremy Ong, a Singaporean dentist, who was prepared to spend S$2 million to buy an apartment. “The latest loan measures are tough and interest rates are going to go up,” said Ong, 32, who had been looking for a three-bedroom apartment near the upscale Orchard Road shopping district. “I planned to take a loan for 80% of the home value, but I’m not sure with the new rules how much I’ll get since I also have a car loan.” Sales drop While an index of private residential property prices rose to a record 216.2 points in the quarter ended Sept 30, the 0.4% increase was the smallest since the first quarter of 2012, according to preliminary figures from the Urban Redevelopment Authority (URA) on Oct 1. Apartment prices fell 0.5% in prime districts in the third quarter, more than the 0.2% decline in the previous three months, the URA data on Oct 1 showed. The city’s private home sales slid 52% to 1,246 in September from a year earlier, the authority said yesterday. Neubronner estimates private new home sales this year could drop to 15,000 units from 22,197 units in 2012. “This is what the regulator wants; the key objective is to moderate the loan growth and price correction with the measures put in place,” said Linda Lee, Singapore-based senior vice-president of deposits and secured lending at DBS Group Holdings Ltd, Southeast Asia’s largest lender. “They also want the consumer to be more prudent when applying for loans so they can control the overall debt in the country.” Hong Kong Hong Kong’s government, in February doubled the stamp duty on all properties above HK$2 million and raised the minimum mortgage down payment requirements on all non-residential properties. “Obviously, the tighter housing supply situation means Hong Kong has fewer tools to fight gains in home prices compared with Singapore,” said Hong Kong-based Buggle Lau, chief analyst at Midland Holdings Ltd. The city’s curbs are starting to show some effects. There were about 11,000 home transactions in the third quarter, the lowest since the government’s Land Registry began making the data available in 1996. Residential prices will fall 15% to 20% in 2014 and are expected to decline 5% this year, according to UBS AG. While some may find Singapore’s property rules “draconian”, authorities should be pre-emptive and proactive, said Varathan at Mizuho Bank. “It’s commendable,” Singapore-based Varathan said. “These are prudential measures to make sure that you don’t get an Asian version of the mortgage crisis in the US.” — Bloomberg This article first appeared in The Edge Financial Daily, on October 17, 2013.

https://theedgemalaysia.com/node/99417

Highlight: Faber favours stable Malaysian equities

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KUALA LUMPUR: Renowned Swiss investor and author Dr Marc Faber, famous for correctly predicting many market falls in the past, has described Malaysian equities as “not gloomy” as they are stable despite the country’s “unexciting” economy. “If you want to sleep at night, just own some Malaysian stocks,” he told an audience attending a seminar organised by MIDF Amanah Investment Bank Bhd in Kuala Lumpur yesterday. Presenting a paper entitled Investment Strategy Where’s the Money?, he said while Malaysia is not spared from the current withdrawals of investments by US investors, this country is far better off than many of its peers in the emerging markets. “Countries like Turkey, South Africa, Brazil and Indonesia have large current account deficits. So they had major sell-offs in the markets lately. “But other (emerging countries) are not in such bad positions, like Malaysia. It is not an exciting economy and the stock market is not particularly cheap, but it is stable,” said Faber. In the second quarter of this year (2Q13), Malaysia recorded a much smaller surplus of RM2.6 billion in its current account, from RM8.7 billion recorded in the first three months of the year. Although the country managed to keep its streak of current account surpluses since 1998, the 2Q13 amount was the smallest since 1999. Faber, who admitted to having invested in Malaysia’s brewery and tobacco stocks as well as Malayan Banking Bhd and Public Bank Bhd shares for years, said there has not been a dramatic and widespread speculation in Malaysia which could cause the country’s economy to fall further than it has now. “If the US market goes down and others around the world drop, then obviously emerging markets as well as Malaysia will also drop. But there hasn’t been a dramatic widespread speculation in Malaysia,” he noted. Faber also credited Malaysia’s financial institutions as being some of the most solid in the world as they are less indebted than banking giants in the US. “They (Malaysian banks) don’t gamble on derivatives and so forth to the extent that their leverage is really high.” Nevertheless, Faber said Malaysian equities are not as cheap as they used to be. “I don’t think people who buy shares (in Malaysia) today will make a lot of money. Maybe they will gain 10% or lose 10%. But it’s not like in 2009 where you could make the case that stocks were very cheap on any valuation measure. I don’t see that today.” Faber also said he would not be concerned if his investments in Malaysia’s tobacco and brewery stocks go down by as much as 20%, unless he invests all of his money in the stock market. He advocated taking a balanced approach in allocating investments in different asset classes, explaining that prices of different asset classes inflate and deflate at different times with different intensity. Faber, who has been a strong proponent of gold investment, said prices of the precious metal could drop again in the future. However, he pointed out that gold prices will continue to grow in the long term. “The people who talk about the end of the gold bull run are the people who’ve never owned a single ounce of gold in their lives.” Faber, who authored several books and monthly investment newsletter The Gloom Boom & Doom Report, had correctly predicted the US stock market crash in 1987 and the rise of emerging markets in the early 2000s. Based in Hong Kong, he is the managing director of his own investment advisory firm, Marc Faber Ltd. This article first appeared in The Edge Financial Daily, on September 11, 2013.

https://theedgemalaysia.com/node/73235

Looser liquidity lifts China’s developers

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Improving sales and a liquid offshore capital market have pulled China’s property developers back from the brink of collapse. However, they are still not out of the woods yet as policy is expected to remain tight, with no change in sight until after 1Q2013, says Christopher Lee, a corporate credit rating analyst at Standard & Poor’s. In a recent interview with The Edge Singapore in Singapore, Lee says he is not expecting any directional change in policy in the short term as inflation remains a concern. “What the government wants is for prices to remain stable and the social housing programme to make some headway. It wants to build 36 million units by 2015 and it started [doing that] in 2011, so the next few years will be crucial. Until then, there is limited space for policy to be relaxed,” says Lee. The leadership change is another factor that will put policy changes on hold, at least until the transition is over. “The new leadership won’t make its mark until 2Q2013,” Lee says. Things looked pretty bleak for China’s property developers early this year. As credit tightened, many of them began trying to sell assets and raise fresh equity to stay afloat.Notably, Greentown China sold a 24.6 % stake in itself to Wharf Holdings in June, after selling land-use rights to a 25,594 sq m plot in Shanghai to Soho China in April. Coastal Greenland sold land-use rights to a 115,700 sq m commercial project in Suzhou to Shenzhen Investment and SPG Land sold land-use rights to a 263,300 sq m piece of land in Wuxi to Evergrande Real Estate Group. Fortunately, China cut interest rates in June and gave banks more flexibility to set deposit and lending rates. A second rate cut followed in July. That set the stage for a sharp rebound in the property market. A Nov 5 Citi Research report says that in October, major developers averaged property sales growth of 3% m-o-m and 35% y-o-y. “The worst for developers is over in terms of liquidity. They were distressed, but didn’t go under. Just as they were on the brink, the property market rebounded from the bottom,” says Lee. Yet, profit margins of property developers are still under some pressure, reflecting competitive price cuts in order to boost sales. So far, the heavyweight players such as China Overseas Land Investment (COLI), China Resources Land (CR Land) and Shimao Properties have been relatively less affected, as they were able to maintain their sales without significant price cuts. But Lee says it’s a matter of time before they, too, will be hit. “All their margins are going to come down. The question is how much the margin drop will be offset by an increase in sales,” says Lee. The big developers might still have an edge over their smaller peers in the months ahead, though, because of their superior credit ratings, which enable them to obtain financing on relatively favourable terms to expand their landbank. On the other hand, the smaller players are not only suffering a sharper contraction in margins but are also less likely to be able to obtain credit on the same favourable terms for growth. “For the vast majority in the lowly rated category B or BB-, sales have not caught up. It’s a double whammy for them,” says Lee. Tapping offshore fundsWith improved sales in 2H2012, the major developers have been in better shape to raise bond financing. Among the developers that have done so are Kaisa Group Holdings, Fantasia Holdings Group, Longfor Properties, Franshion Properties, China South City Holdings and Soho China. Collectively, they have raised more than US$4.2 billion (RM12.85 billion) in bond proceeds since July compared with just two deals that total less than US$1.1 billion in 1H2012. In fact, yields on their bonds have compressed recently, reflecting strong investor appetite for their paper. Longfor, which is rated BB+, was giving a yield of 9% two years ago compared with below 7% in September. Franshion gave a yield of only 4.7% on its US$500 million bond in October, reflecting its parentage. It is a unit of the state-owned Sinochem Corp. A year or two ago, such low yields would only have been accorded to investment-grade bonds. Yet, Franshion is rated only BB+. However, while the market has become generally more enthusiastic about debt issues from Chinese property developers, it is still discriminating between the creditworthiness of the issuers. For weaker developers, the yield on their debt paper can be as high as 13% to 14%. “There is a lot of liquidity, but the market is also rational looking at how they price the yield,” says Lee. The result of this is that larger players with access to cheaper credit might pull further ahead of their smaller peers. “Every cycle, we see the small developers getting smaller and the big ones getting bigger,” Lee says. Among the companies that have managed to parlay superior access to credit into greater heft is COLI, according to Lee. “COLI’s sales were only 10 billion yuan in 2006. Today, they are 100 billion yuan (RM49.11 billion),” he says. In fact, among the big developers, COLI has been the most consistent in terms of performance, according to S&P. It has earned a BBB rating — the highest of the ratings and is the most consistent in terms of growth in sales and landbank, growing at 20% to 25% year in, year out. With the unequal access to credit, it seems unlikely that many more Chinese developers will succeed in expanding across the whole nation. Indeed, some national-scale developers could well drop out of this rarified group if they make a mistake that causes investors to stay away from their bonds. Shanghai-listed Poly Real Estate Group and China Vanke and Hong Kong-listed COLI, Evergrande and CR Land will likely remain national scale if they do not do anything reckless, according to Lee. Of these, Evergrande is seen to have a bigger risk appetite, with more aggressive land acquisition and growth strategies. “The bigger risk appetite is a weakness that affects its credit rating,” says Lee. More niche playersThat’s not to say that all the smaller players will fade into oblivion. The way Lee sees it, as the market becomes more polarised, some developers will become specialists in certain markets and geographical regions. Or, they might choose to specialise in investment properties. That might enable them to draw debt from investors looking for exposure to a certain niche area. Among the companies that seem to be headed in that direction is Beijing-based Soho China, which is evolving a develop-and-hold model that could make it one of the first property investment companies in China. Then, there is Mainboard-listed Yanlord Land Group, which builds luxury homes, many of which are in Shanghai. Niche players face their own challenges, though. Lee points out that Yanlord was more badly affected than mass-market players such as Country Garden and Evergrande by home purchase restrictions that limit people from buying more than two properties. The mass-market developers have diversified projects, low price points and a broader customer base, which provide them with more stable earnings and cash flows. On the other hand, Yanlord’s narrow focus on upmarket projects means that many of its potential customers already have more than two homes. “Yanlord didn’t want to cut prices because of its brand, so it was forced into a corner. Even if they cut prices, they may not be able to sell,” says Lee. “But they are still in the game. They have very good products. They are very reputable. They have good execution and some high-quality investment properties.” The company has a BB- credit rating. Yanlord has actually seen its sales improve recently, and it managed to repay its convertible bondholders in July. Now, some analysts think it might benefit from impending changes to the home purchase restriction policy. They say the policy was a stopgap measure and that a property tax will soon replace it. “It could be a tax on the value of property, based on market valuation, and that applies to new properties only,” says Lee. “[That could] replace home purchase restrictions, which create a lot of distortion to the whole system. Something that is more efficient and easy to implement will be introduced. It will also expand the tax base.” Shares in Yanlord are up 33% this year and are currently trading at 11.6 times forward earnings. While it could be some time before China’s property developers see their earnings rebound to their 2011 levels, the improved — though still unequal — access to credit is making the outlook for the sector less uncertain. — The Edge Singapore   This article first appeared in The Edge Financial Daily, on Nov 16, 2012.

https://theedgemalaysia.com/node/37339

Lotus to unveil four new models next week

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KUALA LUMPUR: Lotus Group International Ltd, a wholly owned subsidiary of Proton Holdings Bhd, will unveil four new sports car models at the 2010 Paris Motor Show next week, industry sources told The Edge Financial Daily. “Lotus will unveil four new models, two of which are relaunch models called the Lotus Elite and the Esprit, at the car show in France,” said a source. He added that the Elite and Esprit are two new “important models” for Lotus. The models will propel Lotus into the upper segment of the sports car market, and help the company tap into a new group of buyers who prefer more comfortable and practical sports cars that can be used for everyday driving instead of the current line-up of sports cars that are designed for track racing. “For example, the Lotus Elite is a four-seater instead of the current sports cars by Lotus which are two-seaters and which are not very practical for everyday use,” said the source. The new models are part of Lotus’ turnaround plan to give a lift to its brand and image. Its management also hopes that the unveiling of the new models at the Paris Motor Show will allay criticism of Proton investing heavily in Lotus. However, automotive analysts told The Edge Financial Daily that they would rather wait for Lotus to produce results in terms of sales before making any predictions on the impact of its latest move on Proton.“There has been a lot of news about Proton on its moves with Lotus, but I would rather take a wait and see approach. You have to remember that Lotus is still a loss-making company,” said an automotive analyst at a local research house. However the timing of the launch during this uncertain period when advanced economies are coming out of the ruins of recession may also be viewed as an opportunity for Lotus because it may be able to ride the next upcycle of the economy, especially in the West. It was reported in this week’s The Edge business weekly that Lotus will remain Proton’s subsidiary and be its “primary technology driver”, according to Proton’s chairman Datuk Seri Nadzmi Mohd Salleh. This is despite Proton receiving three unsolicited offers, including one from the present management led by Dany Bahar to take up a stake in Lotus International Group. In a written reply to The Edge last weekend, Nadzmi also said Proton had agreed to the appointment of Bahar to head Lotus as CEO to replace Michael J Kimberly. Bahar had drawn up a robust business plan and proceeded with the strengthening of the management to ensure that the turnaround objective is achieved. The Edge had reported in August that loss-making Lotus had received RM290 million cash from Proton. In another earlier report, The Edge Financial Daily had quoted Nadzmi as saying that he did not rule out the possibility of its subsidiary requiring an additional RM500 million over the next two years to develop new models. Nadzmi said then that the biggest capital expenditure for automakers was producing new models. Proton has already injected huge amounts of fresh capital into the loss-making company. Whether Proton’s bet on Lotus will be a good one remains to be seen, and a crucial test will be how consumers respond to the latest car launches. The ball is now in Bahar’s court to make his turnaround plan work for the company. This article appeared in The Edge Financial Daily, September 22, 2010.

https://theedgemalaysia.com/node/17147

OCBC Al-Amin Bank to open one more branch

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KUALA LUMPUR: OCBC Al-Amin Bank Bhd, the Islamic banking subsidiary of OCBC Bank (Malaysia) Bhd, will be developing products based on the diminishing musyarakah principle to target its business banking customers, the bank's director and chief executive officer Syed Abdull Aziz Syed Kechik said. He said the move was in line with the bank's commitment to provide diversified solutions to its corporate customers. "In the past year, we have focused on offering products based on the murabahah and mudharabah principles for our retail and corporate customers. In the year ahead, we will put significant emphasis on developing products based on diminishing musyarakah, targeting the business community," Syed Abdull Aziz said. He was speaking to reporters after the launch of the bank's main branch in Kota Damansara here yesterday. "The application of the diminishing musyarakah principle to our product line now and in the future brings us even closer to our goal of making available to customers a complete range of Islamic banking solutions, having already built a stable of over 30 products involve 12 key principles of syariah compliance," he said. Under diminishing musyarakah, a financier and its client can participate in the joint ownership of an equipment, property or a joint commercial enterprise. The financier's share of ownership is then further divided into a number of units that the client will purchase one by one over a period of time, until the client becomes the sole owner. Meanwhile, Syed Abdull Aziz said OCBC Al-Amin was looking to extend the principle to develop products for its business customers after it began offering diminishing musyarakah-based products to its retail customers. On another note, he said the bank planned to open one more branch in Skudai, Johor, by year-end after its Kota Damansara branch commenced operations yesterday. He added this was part of its effort to actively participate in the country's development as an Islamic banking hub. The bank now has four branches. Meanwhile, as part of the bank's opening celebration for its main branch, it is offering customers an indicative rate of 3.5% per annum on their three-month General Investment Account-i, 1% savings on personal financing-i and the chance to "grab" up to RM3,000 cash upon signing up for selected products at the branch, among others, he said. OCBC Al-Amin Bank Bhd,Islamic banking,OCBC Bank (Malaysia) Bhd,Syed Abdull Aziz Syed Kechik,syariah,musyarakah,General Investment Account-i

https://theedgemalaysia.com/node/4954

The terror of government silence

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Datuk Seri Shahrizat Abdul Jalil was the perfect picture of concern and care on the front page of The Star newspaper on 28 May 2009. The newly re-appointed women, family and community development minister was photographed at the Serdang Hospital with a five-year-old child who looked like he had suffered serious and constant abuse at home. "It is so awful and very sad. Obviously the abuse must have been going on for some time," Shahrizat was quoted as saying after she struggled to compose herself. Shahrizat, who is also Wanita Umno chief, has rightfully demonstrated shock at such abuse. However, she has yet to illustrate the same kind of alarm and urgency towards the plight of Penan girls and women in the interiors of Sarawak who were reportedly sexually violated and abused. Indeed, since the report first emerged in mid-September 2008 about the sexual violence towards the Penans by logging company employees, eight months have gone by. A government-led task force into the Baram district completed its investigation in mid-November and yet six months later, Malaysians remain clueless about the plight of the Penan girls and women. Despite public funds spent on setting up the task force, the affected communities themselves remain uncertain about the concrete measures that the government aims to undertake, if at all, to prevent further violations. Visit The Nut Graph to read the rest of the story.

https://theedgemalaysia.com/node/45038

The lure of Seremban

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Compared with Kuala Lumpur and Petaling Jaya, property prices in Seremban are still moderate despite having risen in the last two to three years. Newly-launched properties in Seremban are going at a premium, thanks to increased demand stemmed mainly from improved accessibility. Seremban is only a 20-minute drive from Kajang via Kajang-Seremban Highway (Lekas Highway) and 45 minutes to Kuala Lumpur. Relative to KL and PJ, the standard of living in Seremban is attractive. A typical two-storey link house in Seremban 2 — the hip address in Seremban — can be rented for just RM650 per month. A similar house in Selangor’s Damansara Jaya, a traditional housing enclave, would command twice as much. Seremban, IJM Land Bhd CEO and managing director Datuk Soam Heng Choon notes, also provides a less stressed environment suitable for families with children. “What you pay for a two-storey terraced home in the Klang Valley, you can buy a semi-D here in Seremban,” Soam added. Besides housing, a local consultant is excited at the investment potential of commercial properties in Seremban, pointing to Biz Avenue in Seremban 2. The three-storey shops were launched in 2006 priced between RM500,000 and RM550,000. These, the consultant noted, changed hands recently at up to RM1 million. Rentals for the ground floor units there are commanding RM5,000 to RM5,500 a month.The commercial property market in the state capital is also stirring. Sources said a development has been planned for along Jalan Yam Tuan, one of the main roads within the town centre. Meanwhile, a Kuala Lumpur-based property developer who has apparently acquired a shopping complex on Jalan Sungai Ujong recently is believed to have plans to convert the abandoned complex into an entertainment centre, offering cineplexes and bowling alleys, among others. Certainly, there is more to Seremban than its famed siew pau and beef noodles. Read more about the lure of Seremban as a potential property investment hub, as well as the town’s other pull factors in a special report in the Feb 28 issue of The Edge. This article appeared in The Edge Financial Daily, February 25, 2011.

https://theedgemalaysia.com/node/19397

Glomac acquires land for RM9m

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The land is located within Glomac’s ongoing Bukit Saujana project in the Bandar Saujana Utama (BSU) township. Glomac said it would finance the purchase through internal funds and bank borrowings. In a statement on Oct 5, Glomac said the proposed acquisition was part of its strategy to further extend its development interest in the Sungai Buloh growth area as well as Glomac’s overall plan to increase its land bank in the existing BSU township. The development of Bukit Saujana commenced in March 2009 and is divided into five phases with an estimated gross development value of RM98 million. To date, a total of 85 units of double-storey terrace houses have been launched with more than 80% sales achieved. Since its inception over a decade ago, close to RM1 billion worth of commercial and residential properties had been sold, said Glomac.

https://theedgemalaysia.com/node/95951

Temasek sold stake in Cheniere after share price tripled

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SINGAPORE: Temasek Holdings Pte Ltd, Singapore’s state-owned investment firm, sold its stake in Cheniere Energy Inc after shares of the US natural gas importer surged. Temasek sold 9.2 million shares of the Houston-based company directly or through its units in the second quarter (2Q), valuing the stake at US$257 million (RM842.96 million), according to a filing yesterday with the US Securities and Exchange Commission. Shares in the US energy company gained as much as 200% by the end of 2Q after Temasek announced in May 2012 that it would spend about US$468 million on an equity investment in Cheniere together with RRJ Capital. “The shares had a decent run over the past year,” said Enrico Soddu, an analyst at the London-based Institutional Investor’s Sovereign Wealth Centre. “Temasek just seized the opportunity to make a solid profit.” Tan Yong Meng, a Temasek spokesman, confirmed the filing and declined to comment further. Money managers who oversee more than US$100 million in equities must file a Form 13F with the SEC within 45 days of each quarter’s end to show their US-listed stocks, options and convertible bonds. The filings don’t show non-US securities or how much cash the firms hold. Temasek bought 15.5 million shares in Cheniere during 2Q last year for US$228 million, according to previous SEC filings. The company increased its holdings to 18.3 million shares in 3Q and halved its position during 1Q this year. Investments in energy and resources made up 6% of Temasek’s portfolio on March 31, unchanged from the previous year, according to its latest annual report published last month. Temasek also bought 180,547 shares in Mosaic Co, the second largest North American potash producer, maintaining its position as its biggest shareholder with a stake of 6.6%, according to data compiled by Bloomberg. The investment firm also acquired 867,727 stocks in Monsanto Co. — Bloomberg This article first appeared in The Edge Financial Daily, on August 16, 2013.

https://theedgemalaysia.com/node/29084

RHBIM declares 0.6 sen for global fortune fund

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KUALA LUMPUR: RHB Investment Management Sdn Bhd (RHBIM) has declared a final gross/net income distribution of 0.6 sen per unit for the RHB Global Fortune Fund for the financial year ended Feb 28, 2010. In a statement on Tuesday, March 16, RHBIM said the gross distribution yield based on the average net asset value per unit from March 1, 2009 to Jan 31, 2010 was 1.938%. The first interim distribution of 0.80 sen per unit was made on Aug 21, 2009.

https://theedgemalaysia.com/node/5968

MIDF maintains trading buy on EON Cap

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MIDF Research said EON Capital Bhd’s 1QFY09 results came within expectations with pre-tax and net profit rising by 1.39% and 3.83% year-on-year (y-o-y), respectively, adding that the company’s net profit of RM79.5 million accounted for 37.6% of its FY09 forecast. The research house maintained its trading buy call on the banking group’s stock at RM3.90 with a target price of RM4.50. It said EON Cap’s gross loans for 1QFY09 rose by 6.5% y-o-y to RM31.02 billion contributed by higher loans granted for purchase of transport vehicles by 9.5% y-o-y and for purchase of landed property by 32% y-o-y while loans to SMEs increased by 2.17% y-o-y. The improvement in loans growth is within expectations of achieving a targeted growth of 6% to 8% mainly through its retail and SME banking business, it said. EON Cap’s net interest income declined by 6.22% y-o-y due to lower interest income from loans, securities portfolio as well as interest income from deposits placed with financial institutions. The research house said EON Cap remained adequately capitalised with a core capital ratio (CCR) and risk-weighted capital ratio (RWCR) at 9.2% and 11.8% respectively above the minimum requirement for CCR of 4% and RWCR of 8%.   It said gross and net NPL (non-performing loans) ratios increased to 5.4% and 3.1% respectively in 1QFY09 from 5% and 2.5% respectively in 4QFY08 with the increase in delinquencies from manufacturing and construction as well as loan defaults from household sector.   However, allowance for loan losses were lower by 44% quarter-on-quarter and had not substantially affected the bottom line earnings for 1QFY09, it said. “On y-o-y comparison, NPL ratios for 1QFY09 are still lower compared to gross and net NPL ratios of 6.4% and 4% respectively as at March 31, 2008. “We believe that if the NPL ratios can be contained from further rising coupled with the expectation the one-off charge of RM194 million to set aside additional allowances for loan losses and align its loan losses coverage ratio to the industry average in 2QFY08 not recurring, the group should attain an improved earnings for FY09 compared to the preceding year,” it said. “We maintain our call of a trading buy with a target price of RM4.50 (25% discount of its seven-year historical mean P/BV of 1.24 times). At current stock price of RM3.90, its price/book value (P/BV) of 0.84 times is lower than the banking sector average of 1.42 times. “We believe that there is still a potential price recovery for the stock after its steep price decline. Any revision to the target price upwards would depend on the evidence of new growth drivers,” it said. EON Cap dropped six sen to close at RM3.84 yesterday.

https://theedgemalaysia.com/node/48314

MRT and Vietnam to transform Gamuda’s earnings

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Gamuda Bhd(April 27, RM3.78)Maintain buy at RM3.79 with target price of RM5.25: While the tunnelling tender for the KL Mass Rapid Transit (MRT) system will be via Swiss challenge, we remain confident that the project delivery partner’s reputation and overall better cost structure compared with foreign contractors will see it emerge the winner. The tunnelling job for all three lines is worth about RM20 billion based on 40% of total MRT contract value of RM50 billion. Guidance is for 15% tunnelling pretax margins against 5% for non-tunnelling. The time line for the award of the approved Sungai Buloh-Kajang tunnelling works is by 1QCY12 (RM7.5 billion), and the other lines by 3QCY12. There is room to raise our RM2 per share discounted cash flow (DCF) value for the MRT project (we factored in 50% value in our sum-of-parts), premised on RM14 billion total tunnelling works and 8.3% blended margins. We have raised FY12F/13F earnings by 12% to 30% to build in stronger local property sales of RM1.1 billion for each year (against RM730 million to RM790 million previously). Property sales in 6MFY11 of RM600 million implies Gamuda could exceed its RM1 billion FY11 sales target, which will be revised to RM1.3 billion because of the buoyant market. We also assume maiden sales contribution from Vietnam of RM1.2 billion and RM1.7 billion for FY12/13F respectively, based on average 60% take-ups and 16% to 18% margins. These are below Gamuda’s targets of RM1.5 billion and RM2.1 billion and 20% to 25% margins. Celadon City in Ho Chi Minh City, slated for launch soon, is seeing strong interest (200 out of 250 units pre-registered). Gamuda City in Hanoi will receive in total 40ha of land by July, sufficient for three years of launches. The launch is scheduled for July. We maintain our “buy” call on Gamuda which is still most leveraged to the RM50 billion MRT. There is the likely conversion of RM10 billion (50% share) tunnelling contract wins in CY12 with lucrative 15% margins. Despite the expected higher earnings, there is no change to our target price because it is DCF-based. — HwangDBS Vickers Research, April 27 This article appeared in The Edge Financial Daily, April 28, 2011.

https://theedgemalaysia.com/node/87209

Hello Kitty

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The very things owners love about them, non-fans despise: the way they brush against your legs in figure eights, watch you unflinchingly from atop cupboards or loudly demand — yes, demand — that you show them some attention. The prosecution would pitch the latter as an adorable quirk while opponents would argue that such behaviour radiates arrogance or a misplaced sense of entitlement. Regardless, like it or not, it’s apparent that the cat phenomenon sweeping the Internet is, well, the cat’s pyjamas. YouTube, Instagram, Reddit, 4chan — log on to almost any user-generated content site and chances are you’ll soon stumble upon a cutesy video, photo or post about cats. Frequent reposts keep these circulating and the catchier ones have become so popular that even non-cat people have reluctantly come to know — and maybe even love — a few of these furry personalities. Grumpy Cat is the snowshoe sourpuss that gained widespread Internet fame for her fixed cranky expression, which owner Tabatha Bundesen attributes to feline dwarfism. So great is her celebrity that the cat has a manager; a presence on Twitter, Facebook, YouTube and a dedicated website; an applied trademark; and appearances on Good Morning America and Anderson Live, on top of a photo shoot with Time magazine and an interview with Forbes. Internet users delight in her cantankerous expression and have created countless memes depicting her possible point of view, with the results ranging from "I had fun once; it was awful" all the way to "Why don’t you slip into something more comfortable. Like a coma." And Grumpy over there is just the tip of the iceberg. Look up Venus, the feline fraternity’s answer to Harvey “Two-Face” Dent. The sleek pet has a half-black, half-orange face, complemented by one blue and one green eye, causing Internet users to ponder how genetics created that enigma. Oskar is the kitten born without eyes, and won the Friskies’ award for best cat video, in which, as a newborn, he chased a toy ball. Meanwhile, Spangles is a cross-eyed kitty born on the Fourth of July, and is often dressed up in fun hats and costumes. As captivating as these four-legged celebrities are, one does wonder why the Internet bestows upon cats the reverential deference typically bestowed upon dogs in mainstream Western media. Are “Internet people” mostly cat people? Some claim this to be so, believing that dog loyalists (the perceived more extroverted group) are too busy walking their pets or playing outside to create memes or watch endless videos of kittens running on treadmills. That point is absolutely refuted by the fact that a lot of Internet users who traditionally view themselves as dog people contribute to the stronghold of the online cat phenomenon with likes, shares or created content. Writer Gideon Lewis-Kraus traces a strong root of online cat culture to Japan, saying, “In a culture of Internet anonymity, bred of island claustrophobia and immobility, the Japanese cat has become a crucial proxy: people who feel inhibited to do what they want online are expressing themselves, cagily, via the animal that only ever does what it wants.” So strong is the celebrity cat sentiment here that David Marx, YouTube employee and American author behind blog Neojaponisme, says, “There are cats that are making more money than the average salary in Japan.” Merchandising and advertising are especially lucrative elements of the phenomenon and several owners of celebrity felines are unabashed about cashing in on their pets’ fame, though Lewis-Kraus detects a restraint among selected Japanese cat owners who are wary of being seen as “pimping out” their cats. This worship of cats online isn’t limited to the East, as there was an entire festival created around the topic in the US last year. The Internet Cat Video Festival returns in August in Minnesota, after 10,000 people attended last year’s inaugural festival hosted by the Walker Art Centre in Minneapolis, the turnout propping plans for a second show this year to be held in Brooklyn, New York, later in the year. Festival attendees nominate their favourite catty viral video. Last year’s winner was Henri, a sad French cat whose philosophical musings on long naps and being forbidden from snacking on birds won him the crowd’s votes. Whatever the forces driving this phenomenon may be, there is no denying cat culture has got its claws firmly on the Internet. No matter if you’re a dog or cat person, or perhaps not even a pet person at all, anyone could benefit from the happy hormones released from watching these creatures, whether your preference for feline fun is Nyan cat or once-popular cat band Musashis, or that ridiculously adorable white furball that has a penchant for squeezing itself into glass jars (seriously, look up "white cat in glass jar").

https://theedgemalaysia.com/node/86146

Saifuddin: Umno shouldn't be one race party

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SHAH ALAM (May 15): Umno supreme council member Datuk Saifuddin Abdullah said the country's oldest party must not become the party of only one race but a party for the country. Umno, he said, must move forward and should seriously consider allowing direct membership for the ruling coalition. "Umno secretary-general Datuk Seri Tengku Adnan Tengku Mansor has mentioned the possibility of unification of the parties within Barisan Nasional. I think that is a good suggestion. "This is why I believe that after the general election, BN must open itself to direct membership," he said during a post-GE13 forum organised by Sinar Harian entitled "Where is Malay politics heading?" Other panellists included newly elected Bukit Bendera MP Zairil Khir Johari from DAP and PAS' Kuala Terengganu MP Raja Datuk Kamarul Bahrin Shah Ahmad Shah. Saifuddin, who failed to defend the Temerloh parliamentary seat in GE13, stressed that although Umno was a Malay party, it was not racist. "Umno is party for the Malays but it is not anti-non Malays and that is mentioned clearly in the party's constitution… We must become Malay for Malaysia. Malay that is not scared of meritocracy," he said. He stressed that Umno's struggle and Malay agenda will not be lost with the direct membership to BN. "It is a normal human psychology for us to gather as a group and there is nothing wrong for the group to fight for the welfare of its own people. However, it is wrong if the group is anti-other races," he said. "BN knows that there are groups that want to become part of BN without joining any of the component parties because they do not want to inherit the extra baggage from those parties," he added. Saifuddin said GE13 has proven that Malaysian voters do not make their decision based on the ethnicity of the candidates and party leaders. "Malay voters are now colour blind. During the election, you see Malay villages with the (DAP) rocket flag flying and non-Muslims waving the PAS flag. "BN must change and introduce direct membership. The colour blind voters can no longer associate themselves with Umno, MCA and MIC. "In this election, there was a third manifesto and that was the rakyat's manifesto. The real manifesto is from the ballot boxes and now we must learn how to interpret it," he said. Saifuddin explained that GE13 was a balance between two groups of people; the hope of development versus the hope for democracy. "In the 13th general election, the electorate was divided into two main groups, those who voted based on their hope for development such roads, water and basic amenities, while the other group voted based on their hope for democracy and on issues such as freedom, human rights, equality and corruption. "Where the majority of voters voted based on hope for development, BN won. Where the majority voted based on hope for democracy, BN lost," he said.

https://theedgemalaysia.com/node/83207

RHB Research upgrades MBSB to Buy, fair value RM3.40

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KUALA LUMPUR (Oct 24): RHB Research has upgraded its rating on Malaysia Building Society Bhd to a Buy, following its positive outlook on the company’s revived momentum of its corporate loans book, as well as controlled expenses ratios. In a note Thursday, RHB Research said both factors should mitigate the reduced potential of its retail portfolio and personal financing business, which are priced in, as the stock price has trimmed by 10% from the last three months. “Our new fair value at RM3.40 implies ex-rights fair value at RM3.10,”it said.

https://theedgemalaysia.com/node/32233

BLand JV aborts US$200m themed village project in Korea

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KUALA LUMPUR: Berjaya Land Bhd (BLand) has aborted its proposed US$200 million (RM640 million) joint venture (JV) project, an international themed village, on a 586,040 sq metre (about 145 acres) parcel of freehold land in the Jeju Special Self Governing Province in South Korea. In a statement yesterday, BLand said it and the Jeju Free International City Development Centre (JDC) had mutually agreed that their conditional memorandum of agreement (MoA) on Aug 28, 2008 involving the development of the “themed village project” had lapsed. The company had previously announced that the project would feature residential and commercial or retail components themed for various countries around the world that would showcase a variety of cuisine, beverages, culture and entertainment from various regions. However, BLand said their earlier JV, Berjaya Jeju Resort Ltd, would focus their efforts on the development of a resort-type residential and commercial complex project at Yerae-dong, also in Jeju. Known as the Yerae Resort-type Residential Complex, this project on a 183.8-acre land reportedly cost US$2.6 billion while gross development value was valued at an estimated US$3.6 billion. This article appeared in The Edge Financial Daily, June 23, 2010.

https://theedgemalaysia.com/node/4271

Bond downgrades on the rise

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In the last three months, private debt securities (PDS) amounting to RM1 billion have been downgraded by Malaysia’s two rating agencies. This does not mean that all or even some of these issues will default. But it sends a strong signal of the deterioration in the credit quality of the issuers. In fact, Bank Negara Malaysia proposed last week to bring back the Corporate Debt Restructuring Committee (CDRC), which was set up during the Asian financial crisis in 1997/98 to restructure corporate borrowings, but this time with an extended scope to tackle PDS as well. This is because PDS now forms 42% of outstanding corporate debt portfolios compared with less than 25% back then. The move by the central bank is timely given the string of downgrades recently. According to Malaysian Rating Corp Bhd (MARC), thus far in 1Q2009, five issuers were downgraded and 10 have been placed on negative watch. The rating agency expects the corporate default rate for its rated universe to exceed its average of 2.1%, reaching 4.1% in its base-case scenario. In 1Q2008, the ratio of downgrades to upgrades was 0.33:1 but this year, there have been no upgrades. “Incidences of financial covenant breaches, as well as instances of issuers seeking waiver for scheduled sinking fund payments and negotiating with bondholders to extend bond tenure have increased in recent months. Some weaker issuers have been compelled to seek waivers on bond covenants while others are already in negotiations with lenders to restructure their debt with a view to avoiding payment default,” says Milly Leong, MARC’s chief rating officer. Ray Choy, the head of debt market research at RHB Research Institute Sdn Bhd (RHBRI), notes that the ratio of positive to negative actions in the current quarter has declined from the 2008 quarterly average of 0.6 times to just 0.1 times. Positive actions refer to rating upgrades or a positive outlook rating and is the reverse for negative rating actions. “There are currently more bonds placed on negative outlook, which means that over the next 6 to 12 months, more downgrades will materialise. Furthermore, there’ll likely be an increasing number of bonds being downgraded to non-investment grade. The more significant concern is not just the negative rating actions but the additional risk of defaults by issuers as well,” he says. A fixed income analyst with AmResearch Sdn Bhd agrees that there has been a rising number of downgrades in corporate bonds since last December. “This will be a year of downgrades. The credit play for 2009 will still be a flight to quality where credit quality is an important factor to preserve the resilience of one’s portfolio because a downgrade may lead to a drop in liquidity and mark-to-market losses, and the bondholder may be stuck with such bad credit,” he says. RAM Rating Services Bhd, in a media release, notes that cyclical industries, such as electrical and electronic, automotive, shipping, construction and property, will be hard hit in the current down cycle. However, companies whose businesses revolve around consumer staples such as food and beverages, general healthcare and rubber gloves — particularly, examination or surgical gloves — will continue to exhibit a higher degree of resilience. RHBRI’s Choy observes that papers with single A-ratings have been most affected in terms of negative actions in the last few months. For example, he cites the recent downgrades of debt securities in the property sector, which is more susceptible to economic cycles. “Most of these were initially single-A rated papers, and were rapidly downgraded to non-investment grade within half a year. This is a concern to investors because these were once single-A papers, and were well within investment grade ratings,” he says. The downgrades in the PDS market are not unexpected, given the state of the challenging business and economic environment. These, combined with company- specific factors such as aggressively leveraged capital structures, downbeat earnings prospects and burdensome debt repayment schedules, as well as limited access to equity and debt funding, take their toll on businesses, says MARC’s Leong. “The withdrawal of credit facilities by banks and reluctance to extend new credit could also exacerbate liquidity strains for these corporates. The continuing deterioration in the revenues and earnings of some issuers will undermine their ability to generate sufficient cash flow from operations and restore creditworthiness and this has caused nominal liquidity to weaken, quarter-to-quarter in some instances,” says Leong, adding that some issuers will be relying on asset sales to fund significant parts of their debt repayments. Choy agrees that issuers with heightened refinancing risk as a result of their inability to refinance maturing bonds are a major cause of concern. He says bond downgrades in the current environment are likely to stem from three factors: credit weakness of the issuer; poor macroeconomic conditions; and the issuer’s inability to get refinancing for maturing bonds. “Bankers are now more risk adverse and lend more cautiously as the general economy remains a drag on the credit metrics of the issuer,” says Choy. Are there trading opportunities to be had from the spate of downgrades? The fixed income analysts are sceptical. Choy says the market had already priced in a lot of the credit risk into bonds with higher credit risk and hence liquidity would have declined. While an investor may get a good price for the bond, he would be stuck with it as there is no market for it if he wanted to sell it and in the current environment, investors would not be willing to hold on to papers with poor credit rating. “Besides, I see a larger pipeline of highly rated as well as sovereign papers coming onstream which will marginalise lower credit rating papers. Investors will allocate the funds to higher rated papers, which include Malaysian Government Securities, government guaranteed papers and PDS with implicit government support,” he says. The fixed income analyst with AmResearch says while there is a rather active market for junk bonds in foreign markets, this is not the case in the local PDS market. He notes that internationally, bonds with credit rating below triple-B are considered non-investment grade. However, in the local market, any PDS rated below A3 is generally viewed as “non-investable” by many. The analyst sees risks rather than opportunities in the recent string of bond downgrades. “My personal view is there are selected opportunities for papers with short maturity of one to two years with no default risk, so you can wait for the paper to mature and get the principal back. For example, if a double-A bond is downgraded to single-A, and the yields shoot up to 8%-9%, you can buy the bond and hold it to maturity and earn the 8%-9% yield per annum. As liquidity for the bond can be very thin, the investor will need the capacity to hold it until maturity. In this case, it is essential to ensure that the bond does not have any default risk,” says the analyst. Amidst all the negative rating actions in the PDS market, the AAA-rated papers are still considered safe haven. “Based on historical data, downgrades, defaults and negative outlook ratings tend to be skewed to low rate papers, from single A and below,” says RHBRI’s Choy. The silver lining is still nowhere in sight. MARC is expecting more downgrades and rating outlook revisions, given the current economic conditions where the pressures on credit quality, such as weak demand, suppressed margins, diminishing liquidity and availability of credit, among others, have yet to subside. “Continued deterioration in industry fundamentals and business prospects will eventually be reflected in the issuer’s financial performance while issuer-specific weaknesses, such as high leverage, poor working capital management and aggressive capital spending, will lower the issuer’s overall resilience to challenging conditions. Weaknesses tend to be amplified in times like this,” says Leong.This article appeared in the Corporate page, The Edge Malaysia, Issue 748, March 30-April 5, 2009  

https://theedgemalaysia.com/node/1120

PanGlobal posts RM43m net loss in 4Q

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It said on March 2 revenue was marginally lower at RM66.75 million versus RM67.1 million. Loss per share was 30.92 million compared with loss per share of 11.2 sen. PanGlobal said loss before taxation for 4Q of RM42.5 million (including discontinued operation) was higher compared with RM17.2 million a year ago due to more losses from the insurance and property segment. It said the increase in loss from its insurance segment amounting to RM12.3 million was mainly due to impairment loss on valuation of property of RM12.7 million and impairment loss from the property segment amounting to RM10.3 million. It was also affected by its coal segment due to provision for price adjustment of RM6.7 million. For the financial year ended Dec 31, its net losses increased to RM115.5 million from RM73 million. Revenue was RM252.64 million, up 4.6% from RM241.39 million a year ago. Its accumulated losses increased by RM115.5 million or 13.3% to RM974 million from RM859.11 million a year ago. Its deficit in shareholders’ equity was RM680.24 million. “Due to current depressed economy outlook and unforeseen delay in the group’s debt restructuring scheme, the directors expect the group to continue to incur losses as interest expenses continue to accrue and the financial year 2009 will be a challenging one,” it said.      

https://theedgemalaysia.com/node/52342

Palm climbs most in two weeks as ringgit seen boosting exports

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MUMBAI (Dec 19): Palm oil rallied the most in almost two weeks on speculation that exports from Malaysia, the world’s second-largest producer, may increase after the local currency slid to the lowest level in three months. The contract for delivery in March advanced as much as 1.2 percent to 2,582 ringgit ($788) a metric ton on the Bursa Malaysia Derivatives, the biggest gain for the most-active futures since Dec. 6, and was at 2,576 ringgit at 12:02 p.m. in Kuala Lumpur. The commodity gained 5.5 percent this year, heading for the first annual increase in three years. Malaysia’s ringgit fell for a seventh day after the U.S. Federal Reserve pared stimulus that has spurred flows into emerging markets, boosting the appeal of commodities priced in the currency. Shipments from Malaysia fell 14 percent to 640,240 tons in the first 15 days of December from a month earlier, surveyor Intertek said. “The weakening of the ringgit has helped the market,” said Sandeep Bajoria, chief executive officer of Sunvin Group in Mumbai. “After the fall in the last few days, some demand is coming in. At these levels, Indian buyers are showing some interest.” Soybean oil for March delivery gained 0.4 percent to 39.53 cents a pound on the Chicago Board of Trade. Soybeans advanced 0.3 percent to $13.1775 a bushel. Refined palm oil for May delivery dropped 0.7 percent to 6,048 yuan ($996) a ton on the Dalian Commodity Exchange. Soybean oil retreated 0.3 percent to 6,988 yuan.

https://theedgemalaysia.com/node/63700

Highlight: Telekom Malaysia 3Q profit falls 20% to RM241m

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KUALA LUMPUR (Nov 28): Telekom Malaysa Bhd (TM) reported a 20% decline in third quarter net profit  from a year earlier despite higher revenue. Profit fell on higher operating and finance cost, besides foreign exchange (forex) losses. Lower amount of tax assets had also contributed to bottom line decline, according to TM's statement to the exchange today. TM said net profit fell to RM240.88 million in the third quarter ended September 30, 2013 (3QFY13) from RM301.41 million. Revenue rose to RM2.61 billion from RM2.38 billion. TM said revenue had risen "mainly due to higher revenue from all key services partially offset by decline in voice revenue". The firm said net profit had fallen on "foreign exchange loss on translation of foreign currency borrowings of RM43.8 million recorded in the current quarter as compared to a gain of RM64.8 million in last year quarter in line with the strengthening US dollar against ringgit". According to TM, data revenue increased 17% during 3QFY13. Meanwhile, Internet and multimedia top line grew 14.1% as the group secured more UniFi customers. TM's cumulative nine-month net profit fell to RM667.97 million from RM900.49 million a year earlier. Revenue was however higher at RM7.65 billion from RM7.18 billion. High-speed Internet or broadband will be crucial for TM's 4QFY13 performance. The firm said it will further expand its broadband coverage via collaboration with local real estate developers. "The strategy is to provide high-speed broadband network infrastructure to new property developments. To date, smart partnership agreements have been signed with property developers. "Barring unforeseen circumstances, the board of directors expects TM’s growth prospects for 2013 to remain positive," TM said.

https://theedgemalaysia.com/node/46659

Kids stuff

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Planning a family visit to Europe is great, but when you have young children, you’re going to have to really plan out an exciting itinerary for everyone. And picking out a family-friendly city is another challenge. Luckily, the kind people at www.tripadvisor.com have put together a list of Europe’s top ten family friendly cities to visit. It’s taking the guesswork away completely, and also suggests specific attractions that are a must-visit. Have fun! Florence, ItalySeeing Michelangelo’s David in person is an amazing experience for children of all ages, as is walking through the Duomo for the first time. Not to mention of course, trying some of the world’s best gelato! At the end of the day, have a picnic on the Piazzale Michelangelo and enjoy spectacular views of this golden city.Don’t miss:• Duomo — Cathedral of Santa Maria del Fiore• Statue of David• Uffizi Gallery (Galleria degli Uffizi)• 500 Touring ClubEdinburgh, ScotlandThe world-famous Edinburgh Castle, plenty of free museums, and frequent festivals make Edinburgh a great place for a family holiday. Tour the Royal Yacht Britannia (the former yacht of the British royal family), or visit the Camera Obscura and World of Illusions for five floors of fascinating, hands-on exhibits.Don’t miss:• Royal Yacht Britannia• Portobello Beach• Brass Rubbing Centre• Holyrood Park London, EnglandOf course you’ll see the Tower of London, Buckingham Palace and the Millennium Wheel, some of London’s most talked about attractions. And you can show your children some of the world’s best art at the National Gallery and the Tate Modern. But take time for some lesser-known attractions in London — TripAdvisor travellers say children love the Grant Museum of Zoology, the Golden Hinde living history museum and the HMS Belfast.Don’t miss:• Tower of London• The London Eye• Diana Princess of Wales Memorial      Playground• Horniman Museum and GardensBerlin, GermanyYou’ll want to visit Berlin’s top museums and historical sites, of course — the Checkpoint Charlie Museum, in particular, is a must-see for older children. But Berlin makes a great family destination because it has plenty of opportunities for children to be themselves — beautiful parks and playgrounds, a world-famous zoo, and even an indoor Legoland!Don’t miss:• Zoologischer Garten (The Berlin Zoo)• Brandenburger Tor (Brandenburg Gate)• Berlin Wall Barcelona, Spain Introduce your children to Catalan culture with a family holiday in Barcelona. Gaudi’s imaginative architecture is always a hit with the younger ones, and be sure to visit his masterpiece, La Sagrada Familia, which is still under construction. And nothing fuels sightseeing better than hot chocolate and churros!Don’t miss:• Parc Guell (Guell Park)• Templo Expiatorio de la Sagrada Familia (Church of the Sacred Family)• Tibidabo Funfair• Montjuic (Mountain of the Jews) Rome, ItalyTouring Rome with children is easy — after every museum or church you visit, buy them gelato. Hurrah for bribes! All jokes aside, Rome is an easy city to visit with children. Clambering over ruins in the Forum is educational and fun, and, assuming your children eat pasta, dining out is a breeze. After dinner, stroll through the Piazza Navona and let them dance to the music of the buskers. And get more gelato. You really can’t have too much of it anyway.Don’t miss: • The Colosseum • Borghese Gardens• Mouth of Truth• Museo dei Bambini di Roma Vienna, AustriaThis stately city has a classic amusement park, countless cafes serving up delicious pastries, and fascinating museums and architecture. In fact, we must warn you that if you bring your children to the Hundertwasserhaus, they will undoubtedly view their own home as boring in comparison. The high-stepping Lipizzaner Stallions are trained here, and are quite popular — so if you have any horse-obsessed youngsters in your family, secure tickets well in advance.Don’t miss:• Tiergarten Schonbrunner (the Vienna     Zoo)• Riesenrad• ZOOM Kindermuseum (a children’s        museum) Paris, FranceParis with children might seem a bit intimidating, but in actual fact it’s doable and it’s fun. You’ll want to see the Eiffel Tower, Arc de Triomphe, Louvre and so on, but you can also have a fantastic time cruising on the Seine or picnicking in the Jardin du Luxembourg. La Cite des Sciences et de L’lndustrie is a fabulous science museum. And Disneyland Paris is not too far away either.Don’t miss:• Jardin du Luxembourg (Luxembourg Gardens)• Disneyland Park Paris• Musee des Arts et Metiers• Les Egouts de Paris (Sewers of Paris) Budapest, HungaryThis lovely city on the Danube promises a fun holiday for kids and adults alike. Take a cruise on the river, marvel at the 300-foot dome on St Stephen’s Basilica, or spend an afternoon splashing around in one of Budapest’s many thermal bathhouses. And don’t miss the Children’s Railway, which is even staffed by uniformed 10 to 14-year-olds. Don’t miss: • Palace of Wonders• Budapesti Allakert (Budapest Zoo) • Children’s Railway• Margitsziget (Margaret Island) Istanbul, TurkeyThis exotic, bustling city is becoming increasingly popular with families. Take in the grandeur of the Blue Mosque and the Hagia Sophia, then explore miniature versions of them at Miniaturk, a popular amusement park. For something you won’t see at home, check out the performances at the Turkish Dance Centre at the Hodjapasha Culture Centre.Don’t miss:• Rahmi M Koc Museum• Miniaturk• Bosphorus Cruise This article appeared on the Live it! page, The Edge Financial Daily, March 25, 2011.

https://theedgemalaysia.com/node/22912

Founder pares stake in loss-making LCL

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An aggressive selldown by a major shareholder naturally gives rise to speculation and concern, which is what interior fit-out firm LCL Corp Bhd is facing at the present time.LCL’s founder and chairman Datuk Low Chin Meng has been paring his stake in the company over the past week. Recent filings with Bursa Malaysia show that Low sold 2.81 million shares, or a 1.96% stake, at 60 sen apiece in an off-market deal on Nov 5. On Nov 10, he disposed of 2.3 million shares, or 1.61% equity interest, on the open market at 65 sen each. Low’s biggest disposal was on Nov 11, when he sold 7.38 million shares, or a 5.15% stake, on the open market for RM4.65 million or at 63 sen per share. The next day, he sold a further 4.62 million shares, or 3.23% equity interest, at 63 sen per share. In total, Low has reduced his shareholding in LCL by about 12% for some RM10.74 million. After the transactions, he still holds 31.5 million shares, or a 22% stake, in the company. Low’s decision to dispose of 12% equity interest over just a week has inevitably raised questions: Why did he sell down his shares aggressively and whom did he sell them to?It is noteworthy that Low has reduced his stake in LCL ahead of the company’s 3Q2009 results announcement scheduled for the end of the month, sparking concerns over LCL’s financial performance. After three consecutive quarters of losses, the primary concern now is probably how poor the company’s results will be. Analysts have been expecting LCL to be in the red this year despite Low’s confidence that the second half will be better. Standard & Poor’s said in a September note that as there was “no sign of a turnaround” at LCL, it would be slashing its forecast for LCL for the fiscal year ending Dec 31, 2009, to a net loss of RM44.2 million from a net profit of RM2.2 million. For 2010, the research house projected a small net profit of RM3.7 million. S&P downgraded its recommendation on LCL to “strong sell” from “sell”, but maintained its 12-month target price at 59 sen. In a recent note, OSK Research reduced its earnings forecast for LCL to a loss of RM3 million for FY2009 and cut net earnings by 56.5% for FY2010. The research house maintained its “sell” recommendation on the counter and target price of 44 sen. Since August, there have been two “sells”, one “strong sell” and one “underperform” calls on LCL. The counter closed at 62.5 sen last Friday. Meanwhile, Bloomberg consensus data shows a net loss of RM9.75 million for LCL in FY2009 and a net profit of RM14.4 million in FY2010. Analysts downgraded the company after its earnings were badly affected by the rapid deterioration in Dubai’s construction sector, given LCL’s high exposure in the Gulf city. LCL was also caught in disputes with its customers on certain variation order claims. For 2Q2009 ended June 30, LCL posted a net loss of RM18.1 million on higher y-o-y revenue of RM105.6 million. The situation is just as tricky for LCL today, especially with its huge debts. As at June 30, 2009, its borrowings stood at RM400 million while shareholders’ equity was RM108.51 million. The lack of fundraising possibilities has also limited LCL’s ability to take on more jobs despite its strong presence in the Gulf. Low has also hinted that the company will not take on any more borrowings, given its high gearing. Note that LCL aborted its proposed rights issue in August, and given its poor earnings outlook, the chances of it reconsidering the exercise are very slim. LCL had also proposed late last year to list its Middle East operations on the London Stock Exchange’s Alternative Investment Market, but this failed to take off. However, LCL has been successful in one effort. Between end-June and mid-September this year, it disposed of several properties for RM5.3 million to help reduce its borrowings. Moving forward, a better bet for LCL is probably to opt for strategic tie-ups or to sell a portion of its equity interest directly to a strategic investor to help fund its projects. Nonetheless, in order to do so, LCL will have to convince investors that it can pay off its debts, and that its projects in the Middle East are still viable and worth investing in. That said, LCL’s tie-up with Sunway Holdings Bhd last month to undertake interior fit-out jobs in Abu Dhabi is a positive sign that the company’s business is gaining traction. Furthermore, the appointment of Paul Lim Pang Kiam as LCL’s new CEO earlier this month has offered a glimmer of hope as Lim, who has a background in banking and risk management, will be instrumental in sorting out the company’s financials. However, with the slew of resignations announced at the company last Friday, this remains to be seen. Filings with Bursa show that five of LCL’s independent directors — Datuk Abd Wahab Harun, Tan Sri Abdul Halim Ali, Datuk Emam Mohd Haniff, Chiam Tau Meng and Tan Sri Ahmad Fuzi Abdul Razak — have resigned. While it is certain that major changes are underway for LCL, all eyes will be on Low’s next move. This article appeared in Corporate page of The Edge Malaysia, Issue 781, Nov 16-22, 2009.

https://theedgemalaysia.com/node/13174

China leads regional markets lower

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Chinese shares retreated again after their recent recovery as investors digested comments from Prime Minister Wen Jiabao that China faced new problems and Beijing will keep up its stimulus measures because the recovery lacked a solid foundation. Volatility in the Chinese stock market has been a major factor influencing Asian bourses in recent weeks. The Shanghai Composite Index had fallen some 20% from its peak in early August on fears of overheating and credit tightening measures, after the government’s stimulus packages and aggressive bank lending boosted growth and asset prices. China’s robust economic growth in 1H09 accounted for much of Asia’s relative resilience – when the US, Europe and Japan were mired in deep recession. But equally though, the rest of the world is also starting to recover from recession conditions, albeit slowly. Shares on Bursa Malaysia traded broadly lower on Tuesday, with the FBM KLCI in the red the entire day. The index fell 3.4 points at the close, ending at 1,171.1. Market breadth was negative, with declining stocks outpacing advancing ones by a 3-to-2 ratio. Investors continue to stay cautious, as evidenced by declining trading volume, which has fallen to below a billion shares per day over the past week. Trading on Tuesday totaled just 709 million shares. We believe investors are likely to stay cautious in the near term as the Chinese market will remain volatile, and investors will continue to assess the strength of the global recovery ahead. Trading was dominated by mostly smaller cap stocks, with the notable exception of TM and PLUS. The top actives include Konsortium Transnasional, Multi Sports, KNM, Chuan Huat and Iris. Major gainers include Chuan Huat, Kamdar, LaFarge Cement, AEON, and Suncity. Losers include BAT, SP Setia, Tanjong plc and PPB. 

https://theedgemalaysia.com/node/86236

AmResearch: Dialog 4QFY13 earnings to rebound

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KUALA LUMPUR (May 16): AmResearch said it expects Dialog Group Bhd’s 4QFY13 earnings to stage a rebound despite having posted a “below-expectations” results for its 9MFY13. In a research report today, AmResearch said it is maintaining its “buy” call on Dialog, with an unchanged fair value of RM3.16/share. The stock was last traded at RM2.79. “We have maintained Dialog’s FY13F-FY15F net profits even though its 9MFY13 earnings of RM141 million appears to be below expectations, accounting for 68% and 67% of our and street’s FY13F estimates respectively,” said the note. Giving rationale for its views, AmResearch said the disappointing nine months results was due to continued losses of RM8 million in Singapore’s live plant maintenance job, which was completed last month. “Our channel checks indicate that Dialog has fully provided for the losses in 3QFY13 for this project, which underwent tough working conditions amid high down time. “With the completion of the Singapore project, we understand the group hopes to claim some variation orders from the client.  Hence, we expect Dialog’s 4QFY13 earnings to stage a rebound to possibly meet current expectations.” The group’s 9MFY13 revenue rose 37% year on year to RM1.6 billion but net profit grew at a slower rate at 11% due to a 2%-point EBITDA contraction to 11%. AmResearch also noted that Dialog is now undertaking the fabrication of 1.3 million cu metres of tank terminal capacity with first oil commissioning in 2014. The land for this phase has already been fully reclaimed and pending the finalisation of take-up by Petronas, it added. The research house also said the group’s pre-development stage is going well for its Balai marginal cluster field project. “Currently, the first 4 appraisal wells yielded positive results and the consortium is drilling the fifth well,” it remarked. Additionally, the group’s 50:50 joint-venture with Halliburton Energy Services also commenced operations to redevelop the matured Bayan oilfield off-Sarawak, which could contribute significantly to Dialog’s prospective earnings momentum.

https://theedgemalaysia.com/node/89553

#Market Open* KLCI up 0.1% on US markets

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KUALA LUMPUR (Oct 30): The FBM KLCI rose 2.43 points or 0.1%  amid gains in Asian markets. This follows an overnight positive performance across US markets as investors bet the US Federal Reserve will maintain its current quantum of assset purchases. At 9.04am, the KLCI was traded at 1,818.08. This came on gains in stocks like Petronas Dagangan Bhd and Petronas Gas Bhd. Analysts expect the KLCI to extend its buying momentum. M&A Securities Sdn Bhd research head Rosnani Rasul said the optimism stems from thethe feel-good-factor from Wall Street and the absence of bad news. In a note today, Rosnni said the US Federal Reserve meeting which ends tomorrow will gauge how much the US economy has been hurt from the recent debt and budget-ceiling debacle. "By all account, we don’t expect any shift in US policy rates including its quantitative easing measures. "Hence, the global equity market may still have some room to rally although the upside maybe capped with an increasingly expensive valuation," Rosnani said. Bursa Malaysia saw some 68 million shares worth RM34 million changed hands. There were 77 gainers versus 36 decliners. The top gainer was Petronas Dagangan while Lafarge Malaysia Bhd led decliners. The most-active entity was MQ Technology Bhd Across Asia, Japan's Nikkei rose 0.82% while Australia's S&P/ASX200 was up 0.17%. South Korea's Kospi, however, fell 0.26%. Reuters reported that Asian share markets should take heart from record highs in U.S. stocks on Wednesday as investors wager the Federal Reserve will rock no boats at its policy meeting and leave stimulus in place for the next few months at least. Markets seem to be operating on the assumption that the Fed's policy statement will not challenge the growing consensus that any tapering of its $85 billion of monthly asset purchases will not start until March at the earliest. Such an outcome would be taken as justifying the rallies in stocks and bonds seen in recent weeks and might have only a limited impact on prices in the near term.

https://theedgemalaysia.com/node/64061

Daibochi positive on regional prospects

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KUALA LUMPUR (June 11): Daibochi Plastic and Packaging Industry Bhd (Daibochi) is positive of tapping into the growing prospects of the regional flexible packaging market. Its managing director Thomas Lim said that recently, the company was invited to participate in the global food safety panel of an MNC customer. In a statement on Monday, Lim said Daibochi was the only Southeast Asia participant in the panel. "We are optimistic of the tremendous potential in the regional Food and Beverage (F&B) market as multinational manufacturers increasingly source their flexible packaging requirements from Asia. In recent months, we have witnessed an uptrend in the frequency of visits and requests for quotations from non-Asian MNCs, as Asia typically enjoyed lower costs of production. "Over the years, Daibochi has developed a track record in meeting stringent food safety requirements of MNC customers in the region. This has resulted in the F&B sector being our stronghold customer segment." Lim revealed that the group had savoured initial success in securing business from the new sectors. "Since the first quarter of this year, Daibochi has commenced supply of medical glove packaging, albeit on a small scale. At the same time, we are also undergoing continual testing and certifications for our electronics packaging overseas. "The group had a similar experience in penetrating the F&B sector, and therefore regard these as positive developments in the overall strategy of broadening our clientele," said Lim.

https://theedgemalaysia.com/node/72979

Malaysian Sept exports up 2.6% y-o-y

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KUALA LUMPUR (Nov 9): Malaysian exports rose 2.6% to RM60.21 billion in September from a year earlier as a higher level of intra-regional trade, and exports to the US, boosted sales of the country's products globally, the Statistics Department said in statement on its website today (Friday). This is the first expansion following two straight months of contractions. For September, the Statistics Department said growth in the exports of electrical and electronic (E&E) goods, manufactured items, and petroleum-based products had mitigated the impact of lower sales of palm oil and rubber during the month. E&E goods, the largest component with a 35% share of the nation's external sales, rose 4.8%, mainly, on "exports of electronic integrated circuits", the department said. Sales of manufactured goods and petroleum-based products expanded 2.4% and 13.5% respectively, while palm oil and rubber exports fell 15.4% during the month. From a geographical viewpoint, exports to the Association of Southeast Asian Nations (Asean) grew 18.9%, accounting for 27.1% of Malaysian exports. Sales to the US, the world's largest economy, rose for the fifth consecutive month to 6.3% in September. Export growth to both regions had compensated for lower sales in China, Japan and European Union countries. Malaysian export growth of 2.6% in September follows contractions of 1.9% and 4.5% in July and August respectively. Meanwhile, the Statistics Department said the country's imports expanded 9.6% to RM53.74 billion in September from a year earlier as higher purchases of capital and consumption goods mitigated the impact of lower imports of intermediate goods. During the month, intermediate goods imports which made up the largest chunk of 60% of the country external purchases, fell 2.5% while capital and consumption goods imports rose 22.5% and 13.3% respectively. "Imports of intermediate goods decreased due to lower imports of parts and accessories for computers. Capital goods and consumption goods recorded increases mainly due to imports of aircrafts and medicaments," the Statistics Department said. The latest external transaction figures in September translate into total trade of RM113.94 billion, up 5.8% from a year earlier, it said. Cumulative nine-month total trade came to RM982.74 billion, an increase of 4.3% from a year earlier. During the period, exports rose 1.7% to RM525.5 billion while imports grew 7.6% to RM457.24 billion.

https://theedgemalaysia.com/node/67739

Boustead, Guan Chong, TSH Resources, Metro Holdings, Wing Tai and Kris Assets

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KUALA LUMPUR (Aug 22): The stock market on Thursday will still be driven largely by results as corporate earnings of major and minor companies continue to stream in. “Due to the low trading volume during the Hari Raya festive season, we expect the KLCI to remain flat around its current levels. The local market could see some impact from the corporate results announcements these two weeks,” said Lee Cherng Wee, analyst at JF Apex Research. “Investors should also look out for upcoming US data over the next two days such as Federal Open Market Committee's minutes of meeting, home sales and jobless claims, which could influence the Federal Reserve in determining whether QE3 is needed or not,” he told theedgemalaysia.com. Based on corporate results released Wednesday, stocks to watch for Thursday may include Boustead Holdings and all listed companies under its umbrella. Boustead reported a 76% fall year-on-year in net profit for the second quarter. The other stocks include Guan Chong Bhd (GCB), which reported flat results but declared dividend. It will continue with its bonus issue despite aborting a dual listing exercise. In their latest quarterly results filings, TSH Resources Bhd reported a plunge of 59% in net profit to RM14.62 million on reduced revenue, Metro Holdings Bhd saw its revenue fall by 48% and slight drop in net profit. In addition, Wing Tai Malaysia posted much lower profit of RM14.92 million, down by 72% year-on-year. Kris Assets Holdings also saw its net profit fall by 42% to RM42.13 million.

https://theedgemalaysia.com/node/9366

China’s Xingquan to raise up to RM208.9m from IPO on Bursa

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Its chief executive officer and executive chairman Wu Qingquan said yesterday the company had earmarked 40% of the proceeds from the listing exercise to expand its distribution networks and also production capacity in China. Speaking at the release of Xingquan’s prospectus, he said the company, with 1,400 points of sales covering 20 provinces in China, was looking at a “growth rate of 30% in the points of sales, either within or outside our network”. Xingquan will be the first foreign firm to directly list on Bursa. The company’s 55,000-square metre factory in China was expected to begin operations in the second half of this year, increasing production capacity to 10 million pairs of shoes and 28 million pairs of shoe soles per annum, from 5.9 million pairs of shoes and 14 million pairs of soles now.According to the prospectus, in the first half of this year, there was a 16.2% increase in gross profit for soles to RM12.78 million compared with a year ago. Its sport shoes saw a 63.3% jump in gross profit to RM50.06 million while its apparels and accessories recorded a 20.5% rise to RM16.16 million. Wu said the listing exercise would involve 99.5 million shares, of which 9.5 million shares would be offered to the Malaysian public at a retail price of RM2.10 per share. The retail offer price will be at about 5% discount from the institutional price to be announced tomorrow. The remaining shares will be offered to Malaysian and foreign institutional investors. Depending on the results from the book-building exercise on the institutional offering, the IPO is expected to raise between RM125.73 million and RM208.9 million in total. Assuming it will raise RM125.73 million, about RM32 million would be used for marketing and advertising, another RM33 million to expand its sales and distribution networks while RM19.6 million is for expanding production lines, RM15 million for research and development, working capital RM17.12 million and RM9 million as listing expenses. If it is able to raise RM208.95 million, the most significant increase would be expansion of production capacity, which is tagged at RM99.82 million. “The number of specialty and retail stores selling Addnice sportswear (one of Xingquan’s brands) has more than tripled from about 400 stores over the last three years,” he said.According to Wu, Xingquan chose Bursa Malaysia as a listing platform due to Malaysia’s economic stability, its relative resilience to the global crisis, as well as the good bilateral ties between China and Malaysia that were reinforced by the recent visit by Prime Minister Datuk Seri Najib Razak. Wu added that the company’s efforts to be listed on Bursa Malaysia were facilitated by its cooperation with CIMB Group, the Securities Commission and Bursa Malaysia. “CIMB spotted us as a good fast-growing consumer company and was eager to bring us into the Malaysian equity market. We have been given approval within one month by the Securities Commission, and Bursa Malaysia has also waived the listing fees for us,” he said. “We are confident that by listing on the Malaysian bourse, the listing status and access to capital market will provide our business an added boost,” Wu said. He added Xingquan had no plans to expand outside China although Malaysia would be given top priority should the firm decide to do so. CIMB Group deputy chief executive officer Datuk Charon Wardini Mokhzani said CIMB was looking at bringing other foreign companies to list here. He declined to give details. This article appeared in The Edge Financial Daily, June 24, 2009.

https://theedgemalaysia.com/node/18981

Malaysian Bonds

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The ringgit government bond market closed mixed in thinner trading ahead of possible market moving events due last Friday. These included the release of the October CPI and the third quarter GDP numbers, as well as the details of the upcoming 3.5-year MGS auction. On Friday, Bank Negara Malaysia announced it would auction RM3 billion of the MGS maturing in May 2013, which will be the next 3-year MGS benchmark. The announcement sent the current 3-year MGS to close unchanged at 2.96% after it hit a high of 2.98%. The upcoming end-of-month auction will bring total government debt issuance to RM86 billion thus far this year. The October CPI showed that consumer prices fell by a larger 1.6% y-o-y compared with the consensus of 1.5% decline, while 3Q GDP registered a contraction of 1.2% y-o-y, which was in line with our economist’s expectations. This week, we expect trading to remain lacklustre in lieu of the scheduled MGS auction, which closes on Nov 30. Meanwhile, the overnight policy rate (OPR) decision is scheduled for Nov 24. However, markets anticipate Bank Negara policymakers to hold the OPR steady at 2% as the economy slowly recovers and inflation outlook remains benign. Ringgit IRS rates were traded steady, in line with expectations that global interest rates will remain low well into next year. The 5-year IRS closed unchanged at 3.78%. There was a surge in the trading of corporate bonds during the early part of the week, with volume rising to over RM400 million per day. However, trading turned lacklustre ahead of the weekend, as investors waited for the October CPI and 3Q2009 GDP number. We noted various PDS names, which had not been dealt for a number of weeks, emerging in secondary trading. There was also a larger number of medium-term tranches (5 to 10-year maturities) being traded. Among the heavily traded papers in the high-grade segment was Sime Darby Nov’16 (AAA), which was last seen at 4.7% (or down 5bps for the week). There was also a realignment of Cagamas tranches (AAA) maturing in 2014 converging at 4.3%. There was also huge volume in AA1-rated YTL names. YTL Power Sep’13 shed 46bps to 4.35% while YTL Corp Jun’14 was unchanged at 4.65%. Comments: [email protected] and [email protected] This article appeared in Capital page of The Edge Malaysia, Issue 782, Nov 23-29, 2009.

https://theedgemalaysia.com/node/52634

Shipbuilding industry plans for brighter future

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KUALA LUMPUR: Shipbuilding and ship repair (SBSR), which has remained a forgotten industry in Malaysia for decades, is getting set for new horizons. A strategic plan for the sector until 2020, that was presented to stakeholders for their feedback last Wednesday, outlines the key challenges and opportunities that can transform its future. The drivers of the plan — the Malaysia Industry-Government Group for High Technology (MIGHT) and the Association of Marine Industries of Malaysia (AMIM) — are banking on the plan to lift the industry from its current state to an economic activity that will contribute significantly to the economy and generate valuable spinoffs. Valued at RM7.36 billion in 2010, the sector is envisaged to grow at about 10% per year to generate RM19.9 billion in gross national income by 2020, based on the current uptrend of gross output. As a labour-intensive enterprise, it is expected to be a significant employment generator, contributing an estimated 55,500 jobs, the planners foresee. Its enormous untapped potential, they hope, will be among the pluses that will draw the attention of the country’s leaders. “A lot of the current output from the industry is being exported,” AMIM president Tan Sri Ahmad Ramli Mohd Nor told a press conference here after the presentation, underscoring the demand for its services. “We feel that we have lost a lot of ground in the last 20 to 30 years, and we cannot wait for the National Maritime Policy to be completed before we move forward.” The industry needs to win backers at the highest political level in order to attract the necessary resources for it to take off in a big way. Key representatives at the presentation thanked MIGHT, and its science adviser to the prime minister Professor Emeritus Datuk Dr Zakri Abdul Hamid, for spearheading the proposed strategic plan. They said they hope it will spark interest in Prime Minister Datuk Seri Najib Razak to develop the industry in a big way. After gathering feedback from stakeholders, the strategic plan will be fine-tuned before it is presented to Najib at the Langkawi International Maritime and Aerospace Exhibition in December, said MIGHT president and CEO Mohd Yusoff Sulaiman. Discussing the challenges facing the industry, Lt Col (R) Kamarulzaman Zainal of MIGHT noted that interventions would be needed at several levels, from policy formulation to the regulatory framework, financing, incentive structures, design capabilities, human capital development and the institutional framework. Given the untapped potential for growth, the strategic plan envisions that the Malaysian SBSR industry will be a major player in the small to medium-sized shipbuilding market in the next decade. The goals for 2020 include: •     capturing 80% of the local new build market;•     capturing 2% of the global new build market;•     capturing 3% of the Melaka Straits repair market;•     capturing 80% of the South China Sea offshore repair market, and•     focusing development initiatives on the niche market for vessels under 120m. To achieve these goals, a seven-pronged strategy will be pursued, according to the strategic plan. These include: •     establishing business-friendly policies to support the industry;•     strengthening the institutional framework;•     reinforcing the regulatory framework to ensure the quality and reliability of companies in the industry;•     attracting and developing an adequate and capable workforce;•     applying local design and adopting new shipbuilding and ship repair technologies;•     improving financial and incentive packages and promoting inward investment; and•     upgrading the competency and sophistication of the industry. Among other things, stakeholder representatives noted that the local industry should learn from Singapore, which has a high cost of living but can offer competitive pricing for its services. This article appeared in The Edge Financial Daily, August 3, 2011.

https://theedgemalaysia.com/node/60867

#SE Asia Stocks* Mostly down on Fed tapering talks ahead of US job data

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(Dec 5): Most Southeast Asian stock markets fell on Thursday as speculation over a possible reduction in the U.S. Federal Reserve's stimulus dented sentiment, while many investors awaited cues from U.S. job data, due later this week. Jakarta's Composite Index was down 1 percent to a near three-month low by 0615 GMT, while Singapore's Straits Times Index was trading 1 percent down near two-month lows, and the Philippines traded 0.7 percent lower. Unexpectedly strong U.S. factory activity data released last week has renewed the possibility of the U.S. Fed starting to taper its asset buying programme sooner than expected. Investors are waiting for more clarity from U.S. employment data on Friday. Many analysts expect the Fed to take a decision on reducing its latest bond purchases, at its March meeting, but some think that could be brought forward to January, or at the extreme, later this month, if the employment data comes in strong. Thailand's stock market, which saw over 21.45 billion baht ($664.60 million) of foreign outflows in six straight sessions through Wednesday due to political tensions, was closed for a holiday. Vietnam's benchmark VN Index edged down 0.1 percent on a lack of supportive news, while Malaysia, bucking the trend, was up 0.2 percent.

https://theedgemalaysia.com/node/14884

Demonstration in front of mosque for fear of attack

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Last Updated: 10:23am, Jan 29, 2014 GEORGE TOWN (Jan 29): Some 100 people gathered in front of the Bayan Baru Mosque with placards and banners after evening prayers yesterday to demonstrate against an alleged rumour that the mosque was under attack. They were allegedly from 10 non-governmental organisations including Persatuan Mukabuku Pulau Pinang, Pertubuhan Pribumi Perkasa, Persatuan Kebajikan Insan Mulia and Persatuan Belia Merong. It is believed that the demonstrators began gathering at about 8pm followed by a few speeches where demands were made to protect the usage of the word ‘Allah’ and defend Muslim rights. The group later marched to the Bayan Baru police station where they lodged a report on the alleged rumour of an attack. It is believed that the group heard rumours that the mosque was to be attacked by a few people in the evening, thereby prompting the rally participants to gather and protect the place of worship. The demonstration, also featured in the 'maelpengerang blog' and Persatuan Mukabuku’s Facebook page, comes on the heels of a series of religion-prompted incidents in Penang. They comprise the suspension of banners bearing the words `Allah is Great’ and ‘Jesus is the son of Allah’ on the fences of five churches including one Protestant church in the state on Sunday. The four Catholic churches involved were Church of the Immaculate Conception, Church of St John’s Britto, Church of the Assumption and Church of the Nativity of the Blessed Virgin Mary while Victory Lutheran Church is Protestant. This was followed by a 1.20am assault featuring Molotov cocktail explosives that were hurled into the compound of Church of the Assumption on Monday. While church authorities, Umno Penang and its Jelutong division have lodged police reports, they have echoed each other in calling for peace and calm and allow police to investigate. Police: 40% investigation completed, three papers opened on 'Allah' banners Penang police chief SDCP Datuk Abdul Rahim Hanafi said a special taskforce comprising 283 police personnel including 73 senior officers have completed 40% of the investigations. Adding that 16 police reports have been lodged and nine persons have had their statements taken over the past two days, Abdul Rahim said he would not tolerate any act to disrupt peace, security and public order. Three investigation papers have been opened under Section 436/511 of the Penal Code for causing mischief by fire and Section 4(1)(a) of the Sedition Act 1948 in relation to the banners, he said. Sim: A plot by the usual suspects In an immediate response to the demonstration at the mosque, Bayan Baru MP Sim Tze Tzin alleged that it was a “plot by the usual suspects” and that the groups were attempting to create racial tension. “I was informed about some groups trying to play up racial sentiments last night. Since it was related to the mosque, I asked the informants with due respect to notify the police. “The police are in the know. If I can get this information, the police should know more than me. (To the police,) enough talking and giving stern warnings. I urge Abdul Rahim to act tough, act fast and act now,” he said via text message. He added that there was no reason for the public to be afraid and they should carry on as normal. “All they (the groups) want is for Malaysians to feel fear. We should not let them hold our peaceful country to ransom. I seriously doubt Bayan Baru Mosque was under attack. I will let the police conduct investigations,” he said. Sim added that if there was any truth in the rumour, he would urge non-Muslims to stand united with Muslims to protect mosques. “We will not let extremists threaten places of worship including mosques, churches, and temples,” he said.

https://theedgemalaysia.com/node/83215

Market Close: KLCI pares gains after fresh record high

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KUALA LUMPUR (April 12): The FBM KLCI which soared to a fresh record high today, erased gains to finish in the red. Analysts said this mirrors the dips in regional exchanges as investors took profits, and avoided exposure to Malaysia's upcoming 13th General Election (GE). At 5pm, the KLCI shed 8.51 points or 0.5% to settle at 1,698.53 points, led by stocks like IOI Corp Bhd and Tenaga Nasional Bhd. The index rose to another record intraday high of 1716.47 points at 9.11am before falling to an intraday low of 1,696.67 points at 4.34pm. According to Interpacific Securities head of research Pong Teng Siew, today’s market performance was influenced by regional exchanges, contrary to the trend seen in the past three weeks. “Today, (the local exchange) was not immune to the regional factors. In fact, it performed slightly worse than some of the other exchanges,” Pong told theedgemalaysia.com. He also said the FBM KLCI’s negative performance could be more in line with the end of foreign inflows. A JF Apex Securities senior analyst meanwhile, said there were profit-taking activities as the benchmark had earlier reached historical highs. “Some of the blue chips which had been high, now have been pulled back due to profit-taking,” he said. He also said the FBM KLCI’s performance today was “partially” due to the GE factor, as some investors are concerned of being exposed to potential risks coming from what many believe to be the most heated elections in Malaysian history. “(The selling) could continue through elections time,” he said. However, Pong pointed out that up till today, the local market’s picture had been bullish even after the announcement of polling date. Caretaker Prime Minister Datuk Seri Najib Razak has announced that the GE 13 will fall on May 5. Across Bursa Malaysia, a total of 1.09 billion shares worth some RM1.73 billion were traded. There were 243 gainers while losers came to 476. Top gainers included Amway (M) Holdings Bhd, Timberwell Bhd and Fraser & Neave Holdings Bhd. Top losers were Dutch Lady Milk Industries Bhd, Riverview Rubber Estates Bhd and Aeon Credit Service (M) Bhd. Across Asia, major indices such as Japan's Nikkei 225 fell 0.47% while Hong Kong's Hang Seng declined 0.06%. Singapore's Straits Times was down 0.44%. Asian shares retreated on Friday after recent gains, with investor confidence underpinned by Wall Street's record-high close overnight, while the yen hovered near four-year lows against the dollar, according to Reuters. U.S. stock futures were also down 0.1%, pointing to a weak Wall Street open after the Dow Jones industrial average and the Standard & Poor's 500 Index both set new closing records on Thursday.

https://theedgemalaysia.com/node/18875

#Video* Week in Tech (WIT), Sept 28

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Copyright © 1999-2023 The Edge Communications Sdn. Bhd. 199301012242 (266980-X). All rights reserved

https://theedgemalaysia.com/node/15379

KLK 2Q net down 43% on oleochemical profit plunge

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KUALA LUMPUR: Plantation giant Kuala Lumpur Kepong Bhd’s (KLK) net profit for 2QFY12 ended March 31 fell 43% from a year ago as margins tightened. In a statement to Bursa Malaysia, KLK said net profit came to RM214.91 million in the quarter, down from RM373.85 million while revenue rose 11% to RM2.62 billion from RM2.37 billion. KLK said the bottom lines for its upstream and downstream plantation units were weaker on higher labour costs as well as lower selling prices of crude palm oil (CPO) and palm kernel, apart from the less competitive prices of its downstream oleochemical products compared with offerings from Indonesian rivals. According to KLK, profit from upstream plantations fell 21% to RM300.7 million in 2Q, while downstream oleochemical profit dropped 69% to RM42.7 million. “The performance of this division (oleochemical) had been impacted by the erosion of margins due to the huge export duty advantage enjoyed by the Indonesian oleochemical players,” KLK said. It added that operating expenses also rose 20% to RM2.31 billion in 2Q from RM1.93 billion in the corresponding quarter last year due to higher labour cost at its plantation division.   For the interim period, the group’s cumulative 1H net profit fell 18% to RM555.89 million although revenue was up 16% to RM5.55 billion from RM4.79 billion. While KLK foresees volatility in palm oil prices in the months ahead against the backdrop of global economic uncertainty, the firm said it believes prices of the commodity will be supported by tight supply of rival substitute crops such as soybean. “With the expectation of a higher production [of oil palm] during 2H, the group can expect reasonably good profit from plantations for the current financial year [ending Sept 30],” it said. The group is, however, mindful of the stiff competition in the oleo- chemical segment, saying that it only expects to see improvement in this segment when its downstream facilities in Indonesia are commissioned in FY13. This article appeared in The Edge Financial Daily, May 25, 2012.

https://theedgemalaysia.com/node/14594

Social media creates new trend in consumer behaviour

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KUALA LUMPUR: The growing usage of Internet social media has created a new trend in consumer behaviour, forcing companies to adapt and rethink their marketing strategies, said Omnicom Media Group (OMG) Malaysia. “Digitisation and technology is changing the way society functions and as a consequence the way consumers interact and engage,” OMG Malaysia managing director Andreas Vogiatzakis told briefing of the OMD Predicts series last week. OMG Malaysia hosted the OMD Predicts series in its debut in Malaysia on May 8, giving industry participants a peek into current local consumer trends and media developments. OMD Predicts is a series of global industry events by OMG, a global marketing and corporate communications firm. The series aims to look beyond today and anticipate future trends to help the industry better understand media usage-related consumer behaviour and trends. OMD Predicts is being brought to Asia-Pacific for the first time, starting with several countries in Southeast Asia. The research presented in OMD Predicts focused on three key topics, social listening, the consumer-centric role of brands in today’s communication landscape and online TV and real-time buying (RTB). OMD’s first prediction is that in three years, listening to consumers in real time would replace surveys as the mainstay of how insights are gathered. Long gone are the days of companies using outdated data from surveys to strategise their next move. The presence of popular social media platforms such as Facebook and Twitter provides companies an opportunity to listen to what consumers have to say and react to that in real-time. With Internet usage among Malaysians doubling since 2007, it is almost mandatory for brands to have some sort of online presence. “All of the things we need to understand our consumers is all there, ready to be listened to,” said Guy Hearn, director of consumer insights for OMG Asia-Pacific. “In the future, brands and consumers are all part of the conversation. We are going to do a lot less broadcasting where we tell you things, and a lot more engagement and collaboration where we do things together,” he added. Hearn’s insights coincidentally link to OMD’s second prediction which states that brands need to find definite roles and that their contribution will define communication. In other words, the role of brands has changed to put more emphasis on understanding consumer needs and how it can meet them. “What are we doing for consumers, what are the needs of our consumers and what role can we play in meeting them? In the end these are the kind of questions we will be asking ourselves and you [consumers] during the planning process,” said OMD Asia-Pacific head of communications planning Paddy Crawshaw. Another focus point in OMD Predicts is how media and marketing planning is shifting from the hands of humans to electronic tools, allowing for more accurate and effective marketing decisions. Accuen Asia-Pacific general manager Matthew Harty predicts the tools that are now emerging for Internet RTB will be used in television by 2015. “People in different households watching the same television shows will get different advertisements. These advertisements will be personalised down to people based on the information we have”, he said. With how fast technologies and consumer behaviour are evolving, Vogiatzakis stresses the importance of staying ahead and tackling these emerging trends now instead of later. “We don’t expect people to change everything they have been doing overnight. It is important that people understand these opportunities that are available, test them and learn,” Hearns said. This article appeared in The Edge Financial Daily, May 14, 2012.

https://theedgemalaysia.com/node/64918

S P Setia under selling pressure

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KUALA LUMPUR: S P Setia Bhd president and CEO Tan Sri Liew Kee Sin has for the first time exercised the put option granted to him by Permodalan Nasional Bhd (PNB), a move that sees him reduce his interest in the property development company. According to filings, Liew on Monday transferred 45.19 million S P Setia shares, or a 2.35% stake, to PNB in exercising the put option extended to him under the management agreement dated Jan 20. The 2.35% block was worth RM178.53 million based on the transacted price of RM3.95 a piece. The management agreement between Liew and PNB came about after the latter’s aborted takeover of S P Setia that started in November last year. The offer met with resistance from Liew and the management and both parties came to an agreement in January which resulted in some revisions such as Liew being included as part of the takeover offer. Following Liew’s exercising the option, he now holds a 5.88% stake in S P Setia while PNB and its unit trust funds under management collectively hold about 73.06%. S P Setia shares yesterday fell seven sen or 1.81% to RM3.78 with 56,200 shares traded. This was S P Setia’s steepest fall in almost a month. Liew declined to comment on the matter when contacted. When PNB unexpectedly launched its takeover of S P Setia last year, questions abound as to whether Liew would remain with the property developer. The initial offer was at RM3.90 per share, After the resistance from the management, the offer was upped to RM3.95 in January. Liew and PNB also entered into a management agreement where he would remain at the helm of the company for a three-year period and there be no changes to the board during that time. As part of the agreement, Liew was also granted the put option to sell his shares in S P Setia to PNB at RM3.95 each during the period. Equities analysts have said previously that Liew’s exiting S P Setia would be a catalyst for downgrading the property developer. The 53-year-old former banker joined S P Setia as an executive director in 1996 and has been credited for growing S P Setia from a construction company to a major property developer.

https://theedgemalaysia.com/node/23224

MAS eyes RM2b from SITA’s IT system

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PETALING JAYA: Malaysian Airline System Bhd (MAS) expects to rake in an incremental revenue of RM2 billion from the deployment of SITA’s IT system, including the newly launched MHmobile-flymas.mobi service, over the next 10 years, said MAS managing director and CEO Tengku Datuk Azmil Zaharuddin. He said the national carrier had earmarked investments of RM480 million over the next decade for its integrated IT platform to provide customers with seamless service delivery. Developed together with SITA lab, flymas.mobi allows customers to book, pay and check in using their mobile phones. “As a global carrier, we understand the importance of embracing new technologies to ensure that our passengers enjoy seamless service,” he said at the launch of flyMAS.mobi here yesterday. Also present was SITA’s chief technology officer and head of SITA Lab, Jim Peters. MAS has also tied up with Maxis Bhd as its telco partner for the launch. SITA is the world’s leading specialist in air transport communication and IT solutions, with services for about 550 air transport players and combined revenues of over US$1.47 billion (RM4.98 billion) in 2008. Tengku Azmil said the main objective of flymas.mobi was to provide convenience to its 14 million customers rather than cost-savings for MAS. He said MAS would not impose convenience fees on its customers. Flymas.mobi is the first mobile airline application, which connects bookings to Facebook, Triplt and Dopplr, enabling friends and colleagues to be informed of each other’s travel plans. The system allows passengers to check the status of a delayed bag as the application can be linked to SITA’s Worldtracer, the fully automated system for tracing lost and mishandled passenger baggage used by over 440 airlines and ground-handling companies. All major operating systems and most phone manufacturers support the flymas.mobi applications. Tengku Azmil said it had recently completed phase two of the Passenger Services System, the cutover to the new SITA reservations system, resulting in Internet booking transactions increasing to 20% to 30% from only 4% initially. He added that it would roll out more IT applications in the near term. On a separate matter, he said MAS had increased the capacity for its Singapore-KL route. This article appeared in The Edge Financial Daily, December 9, 2009.

https://theedgemalaysia.com/node/49270

Nasim launches Peugeot RCZ

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KUALA LUMPUR: Nasim Sdn Bhd, the official distributor of the Peugeot brand in Malaysia, has launched the multiple award-winning coupe, the Peugeot RCZ. The on-the-road price of the automatic variant is RM218,888 while the on-the-road price of the manual variant is RM223,888. The car, which was voted the most beautiful car of the year at the 25th International Automobile Festival, features avant-garde styling and proportions that heralds a new dynamic chapter in Peugeot’s history. Nasim chief executive officer SM Nasarudin SM Nasimuddin said the RCZ was a design statement from Peugeot. “Its futuristic exterior, luxurious interior and powerful engine is catered for enthusiasts who enjoy driving and want to be noticed. “The RCZ enters the niche premium coupe segment in the market and we are confident it will be well received,” he said in a statement May 19.

https://theedgemalaysia.com/node/70641

Rents rising in core European office markets, says Savills

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KUALA LUMPUR: More than half the markets surveyed by Savills in its latest European office market research report are expected to record positive year-on -year (y-o-y) prime rental growth at end-2012. According to the report, the office rental growth is due to decreasing availability of prime space in the central business districts (CBD). These markets include London’s West End (where the firm expects a y-o-y rental growth of 7.3%), Brussels (5.5%), Lyon (8.7%),  Dusseldorf (5.8%) and Hamburg (4.3%). Overall, the international real estate adviser forecasts that prime CBD rents across European office markets will increase 1.4% on average by year-end. “This relatively limited increase reflects a two-tier situation as certain European markets continue to experience a slowdown in occupational activity and rental growth due to the ongoing eurozone challenges,” the report stated. “Our office rental matrix shows that most of the office markets are in line with their 10-year averages, with some regional variation. The technology, media and telecoms (TMT) sector proved to be one of the strongest sectors in the first half of 2012, particularly in Paris, Dusseldorf and Milan. Together with business services, the TMT sector held up demand,” said Lydia Brissy, Savills’ European research director. Take-up across European office markets decreased on average by 4.2% y-o-y in the first half of 2012, which the consultancy attributes to overall economic uncertainty. However, some markets recorded robust demand levels, including Amsterdam and Brussels, where take-up increased 65% and 10% respectively in 1H2012. The firm expects this healthy demand to continue in 2H2012. Despite the overall decreased take-up, Savills forecast that the average vacancy rate across European office markets will drop marginally to 10.3% by year-end from 10.4% at the end of 1H2012, with some significant regional variations. In certain markets, Savills observed a significant increase in the level of refurbishments of existing offices with the share of these rising from below 10% to a quarter of all office completions in markets such as Madrid (26%) and Milan (25%). Julia Maurer, Savills European research analyst, said: “Looking ahead, we expect demand in the second half of 2012 to be stronger than in 1H and anticipate that in some of the core markets, such as Amsterdam, Frankfurt and Brussels, the total 2012 take-up will exceed 2011 levels. On a pan-European level, we anticipate the average take-up volume in 2012 to come in below 2011 as ongoing eurozone uncertainties impact occupier demand.” In terms of transactions, the majority of lettings are below the 3,000 sq m mark, with larger deals remaining relatively rare. The firm attributes this to a continuing trend for occupiers to relocate to premises with reduced rents often linked with downsizing. European office market report is compiled from the analysis of 21 European markets — Amsterdam, Athens, Berlin, Birmingham, Bristol, Brussels, Dublin, Dusseldorf, Frankfurt, Hamburg, Lisbon, London City, London’s West End, Lyon, Madrid, Milan, Munich, Paris, Stockholm, Vienna and Warsaw. This article first appeared in The Edge Financial Daily, on Oct 5, 2012.

https://theedgemalaysia.com/node/15203

Ramunia regularisation plan by end July

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KUALA LUMPUR (May 23): Ramunia Holdings Bhd plans to complete its financial regularisation plan by end July which will then be submitted to Bursa Malaysia in a bid to lift its PN17 status. Speaking after its AGM and EGM on Wednesday, Ramunia chairman Datuk Azizan Abdul Rahman said they the company had obtained shareholders' approval to proceed with the acquisition of the fabrication yard in Pulau Indah. The yard would cost RM83 million, with an additional RM62 million to be spent on upgrading. Upgrading works is expected to take about 18 months, said Azizan. Azizan said the company would finance the purchase of yard through a rights issue exercise. On whether the floating production, storage and offloading (FPSO) unit had secured any contracts, Ramunia chief executive officer Nor Badli Munawir Mohd Alias Lafti said they had not been successful so far, but were pursuing three projects with three oil companies in Malaysia and hoped to make some announcement soon.

https://theedgemalaysia.com/node/10195

TM, UEM Land extend Nusajaya partnership for another year

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The companies said on July 3 they had mutually agreed to extend the memorandum of collaboration under the original terms. In July last year, TM and UEM Land announced the collaboration to jointly explore the opportunities in the project, in particular areas related to telecommunications infrastructure. UEM Land is the master developer of Nusajaya, positioned to be the largest, premier and fully integrated urban development in South East Asia. Nusajaya is targeted to be the heart of Iskandar Malaysia with seven signature developments - Johor State New Administrative Centre, Southern Industrial and Logistics Cluster, Medical City, Educity, Puteri Harbour, International Destination Resort and Nusajaya Residences

https://theedgemalaysia.com/node/55063

Stable domestic demand and ASP good for Ann Joo

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Ann Joo Resources Bhd(Sept 20, RM1.96)Maintain trading buy at RM2.07 with revised target price of RM2.70 (from RM3.50): Our recent meeting with the management indicated that the average selling price (ASP) of domestic steel bar continues to remain stable ranging between RM2,300 to RM2,400 per tonne. The current price has improved from a low of RM1,900 per tonne in 4Q10. The increase in selling prices is primarily driven by cost-push factors rather than demand-pull. Year-to-date, the spot iron ore price has risen significantly reaching a peak of US$200 (RM628) per tonne from an average of US$160 per tonne in 4Q10. Scrap metal prices have also moved up by some 15% quarter-on-quarter. With raw material prices remaining high, we believe steel bar prices will remain steady within the RM2,300 to RM2,400 per tonne range in 4Q11. As such, we are keeping our FY11 ASP assumption at RM2,260 per tonne. We gather that Ann Joo has sufficient scrap metal to last for at least three months of production, allowing the group some purchasing flexibility against the current high scrap metal prices. Despite the strong news flow on various construction projects, we gather that domestic demand has yet to experience any significant pick-up. Demand is however stable. Ann Joo has consistently managed to sell in excess of 30,000 tonnes of steel bars a month, suggesting that our 405,000 tonne steel bars sales assumption for FY11 is achievable. Despite our recent revision on our 2011 GDP forecast, we make no changes to our construction growth forecast. We maintain our 6% and 7% construction growth estimates for 3Q11 and 4Q11. However, we are more cautious on the export outlook on the back of the softening global economic outlook especially in developed countries. Against this backdrop, in the medium term we think the current soft sentiment for exports will likely persist. Despite the existing and potential mega projects like LCCT 2, Second Penang Bridge and MRT, we understand that Ann Joo will maintain its business model, continuing to sell via its distributors instead of supplying directly to construction players and/or to any specific construction project. This is to minimise credit risk as the credit period could extend up to 60 days. The sintering plant started hot commissioning in April this year and Ann Joo expects the furnace to start commissioning by year-end, barring technical hiccups during the test run. Iron ore for the mini blast furnace will be sourced locally, which is some US$20 to US$40 per tonne cheaper than global prices, due to lower iron content and freight savings. We believe this will give Ann Joo a cost advantage and aid in margin expansion. As for coke supply, there is no additional purchase to the 50,000 tonnes it has in stock in the medium term. For 1H11, Ann Joo declared a gross dividend of four sen per share. Although lower than the six sen per share declared in 1H10, we think our full year dividend per share (DPS) estimate of nine sen, based on 30% payout ratio, is achievable, as the group has historically declared higher DPS in 2H11. In addition, its gross cash has more than doubled to RM141 million in 1H11 with a positive free cash flow of RM18 million. At the current price level, the stock offers a decent dividend yield of 4.3%. Over the past one month, Ann Joo’s share price has been affected by the current weak market sentiment, falling by circa 18%. Despite the improvement in domestic demand and stable average selling prices, we are still concerned over the medium-term outlook of the industry given the volatility of raw material costs (iron ore, coal, scrap prices) and the sluggish external environment. We maintain our “trading buy” call on Ann Joo. We believe Ann Joo is one of the better long steel players to leverage the infrastructure development theme under the Economic Transformation Programme, given its strong balance sheet and credible management. However, we have revised down our target price to RM2.70 (from RM3.50). We still tag a 30% discount but on a revised three-year average rolling price-earnings ratio of 11.5 times on CY12 earnings (from 13.8 times previously).  — Affin IB Research, Sept 20 This article appeared in The Edge Financial Daily, September 21, 2011.

https://theedgemalaysia.com/node/98776

Stop being self-congratulatory, Penang MACC told

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GEORGE TOWN: The Penang office of the Malaysian Anti-Corruption Commission (MACC) has been told to refrain from being “self-congratulatory” on surpassing its key performance index (KPI) target, and instead reopen the files on alleged corruption during the 13th general election (GE13). Bayan Baru MP Sim Tze Tzin noted that the MACC had closed the files on reports of alleged vote-buying and impropriety in relation to GE13 which was held on May 5. “During the [GE13] campaign period, tens of thousands of Penang voters were treated to free food, free drinks and free entertainment,” he said yesterday. “They were given ‘Lucky Bonus’ vouchers to redeem cash if Barisan Nasional (BN) won,” he recalled. “True, as claimed, a week after the election, several outlets started giving out cash for areas where BN candidates had won.” Sim claimed that if the MACC wants to seriously pursue the cases, it can find “hundreds of suspects” involved in the alleged vote-buying activities. He noted that Penang MACC director Samarajoo Manikam had on July 9 announced that the MACC had closed the cases. Samarajoo had reportedly said there was no solid evidence that an offence was committed under the MACC Act 2009. At an MACC function here on Tuesday, Samarajoo told reporters that the state MACC office has this year, up till August, filed 38 investigation papers on corruption. This exceeded the total KPI target of 30 for 2013. In the process, it made 28 arrests and laid 33 charges relating mainly to abuse of power under section 23 of the MACC Act 2009, for using one’s office or position for gratification. In response, Sim said in a statement that the MACC seems “quite happy” with this performance. “However, I would like to offer my suggestions and also my assistance to help them excel at their KPI so that they become the best performing MACC in the entire country. “They should reopen the files on the reports lodged by Pakatan Rakyat candidates concerning suspected vote-buying activities by the 1Malaysia Welfare Club during GE13.” Sim, who is PKR Bayan Baru division chief, noted that seven reports were made by PKR candidates on May 13 this year. “Penang voters experienced these vote-buying activities first hand. Everyone could see it, feel it, and receive it (the ‘Lucky Bonus’ vouchers). “It was a massive, well-planned and well-executed plot involving millions of ringgit and hundreds of operatives,” he claimed. Sim also noted that in July 2013, Transparency International-Malaysia’s (TI-M) Global Corruption Barometer (GCB) reported that only 31% of Malaysians were confident with the MACC’s performance. Calling it a “historic low”, he said the MACC has disappointed Penang voters by not prosecuting the alleged perpetrators of the “Lucky Bonus” activities. When Sim recently, in Parliament, raised his objection to MACC closing the files on the alleged corrupt practices during GE13, deputy minister in the Prime Minister’s Department Datuk Razali Ibrahim had replied that the MACC’s advisory panel could review the matter. “Instead of being self-congratulatory in achieving their KPI (as reported on Tuesday), Penang MACC will be judged by the public on their action against vote-buying activities,” he said. For more stories, go to www.fz.com, the website for freedom of expression and fairness in articulation. This article first appeared in The Edge Financial Daily, on September 05, 2013.

https://theedgemalaysia.com/node/55359

Lotus a drag on Proton’s earnings

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PETALING JAYA: The Lotus’ turnaround plan is on track. However, the sportscar maker will remain loss-making in the next four years, said Proton Holdings Bhd. During last Friday’s analyst briefing, Proton told analysts that Lotus was on track to turn around as the actual result on volume sold has exceeded the management’s target. For 1QFY12, Lotus made a net loss of £14 million (RM69 million) on the back of a £36 million revenue due to its high operating cost. Excluding the loss incurred in the sportscar maker, Proton would have achieved a pre-tax profit of RM102.9 million, instead of RM101 million. To annualise the quarterly loss of £14 million, Proton would have to bear an annual loss of £56 million or RM275.6 million per year. “We expect Lotus to be a drag on the near-term domestic earnings trajectory. Implicit in our ‘depressed’ earnings is a RM250 million Ebit loss for Lotus,” said Affin Investment Bank in a research note yesterday. On the fact that Lotus will be loss-making for few more years, analysts are generally not upbeat about Proton’s earnings prospects at least in the next one or two years. According to Affin Investment Bank, Lotus CEO Danny Bahar confirmed that Lotus’ restructuring plan “is well within the guided timeframe”. “Lotus is expected to be loss-making over the next four years as the management is in the midst of restructuring and developing new products before turning in profit in 2015,” Affin Investment Bank wrote in the research note. OSK Research concurs with the view. “Proton’s immediate-term earnings are expected to be weak on continued losses from Lotus over the next two years,” said OSK Research. “We only expect bumper profits by FY14 on the back of higher plant utilisation rate following the collaboration with MMC (Mitsubishi Motors Corp). We think it is too early to put out an estimate on how much profits would be seen then as the final kinks of the JV details have yet to be worked out,” OSK Research commented. Proton told analysts that it was in discussion with MMC to jointly produce engines in Malaysia, and to undertake contract manufacturing of MMC vehicles as well as share major parts and components for MMC and Proton’s global car project. To some analysts, in its collaboration with MMC, Proton seems to intend to deploy its previous business model when it started in early 1980s. “Proton and MMC have not finalised the joint-venture structure. We understand that both parties could be injecting RM800 million to RM900 million capex to develop a powertrain (including the construction of a casting plant in the Tanjung Malim plant),” said HwangDBS in a report. According HwangDBS, MMC has projected a preliminary assembly target of 60,000 units per annum at the Tanjung Malim plant by 2013. “This would help improve capacity utilisation rate at the plant from 52% to 85%,” said HwangDBS. Besides, Proton said revenue derived from the assembly plant was estimated to be at RM4,500 per unit and this would translate into a total revenue of RM270 million annually should things go according to plan. Two models of MMC are expected to be assembled by Proton to serve the Asean market, one of which would be Mitsubishi ASX. The low utilisation of the Tanjung Malim plant is a factor that Proton has not been able to maximise its earnings potential. Analysts said if the collaboration materialises, it would be a boost to Proton’s earnings. However, there are concerns that the collaboration with MMC could strain Proton’s balance sheet. Proton and MMC hav yet to finalise the structure of the JV, in terms of shareholding. “Assuming a plant capital expenditure of RM800m, Proton having a 60% equity stake and a debt-to-equity ratio of 70:30, we envision that Proton may have to borrow between RM400 million and RM500 million,” said Affin Investment Bank, which expects Proton’s borrowing to increase “fairly steeply”. As at yesterday’s closing price of RM2.63, Proton is trading at a battered price-to-book value per share of 0.27 times, and price to net tangible assets per share of 0.33 times. Year-to-date, the national car maker’s share price has lost 41.2% to a two-year low of RM2.63. Despite the undemanding valuation of Proton shares, none of the investment analysts in town are recommending a “screaming buy” call on the group. CIMB Research, which has upgraded to “neutral” after the recent sell-down, said that although it is still early days for the benefits from the MMC tie-ups to be materialised, it is the right step forward taken by Proton to give it a “new lease of life”. The research firm noted that the collaboration would ensure the long-term sustainability of the group. “We think that even if the partnership does not involve the setting up of a JV or the sale of an equity stake, value could still be extracted via short-term technical or product collaboration, an option that is fast gaining popularity among global automakers that are looking to lower their product development costs,” it said. This article appeared in The Edge Financial Daily, September 27, 2011.

https://theedgemalaysia.com/node/93245

TIV for auto industry to stay positive until 2017, says MAA

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SHAH ALAM: The local automotive industry, which saw a good first six months this year, is expected to show sales growth until 2017, albeit at a conservative annual figure of between 2.1% and 2.4%. According to the Malaysian Automotive Association (MAA), the total industry volume (TIV) will increase to 653,440 units in 2014 (+2.1%) from an estimated 640,000 units in 2013, 667,800 units in 2015 (+2.2%), 683,000 units in 2016 (+2,3%) and 699,300 units in 2017 (+2.4%).   This was disclosed yesterday by MAA president Datuk Aishah Ahmad when presenting a report card for the automotive industry for the first six months of this year. The TIV comprises both passenger and commercial vehicles. She said TIV growth in the first half was encouraging despite a slowdown in May when the general election was held. The TIV for the six-month period rose 4.1% to 313,488 units this year from 301,269 units last year. Of the total, sales of passenger vehicles registered 275,991 units in 2013, a 3.8% increase from last year’s 265,901 units. Sales of commercial vehicles grew faster at 6% during the period with 37,497 units sold. Perodua took the lead in sales among the total number of registered vehicles for the first six months of 2013 at 212,597 units, and it registered 73,908 units or 34.8% of this figure. This was followed by Proton with 53,145 units (25%) and Toyota 20,240 units (9.5%). Among registered non-national car makes, Toyota led the pack with 20,240 units, followed by Nissan (17,533 units), Honda (17,416 units), Volkswagen (3,938 units) and BMW (2,847 units). “In terms of new vehicle sales, the monthly sales trend in the first four months of 2013 was consistently higher than in 2012. However, the expansionary trend was interrupted in May due to the impact of the promises on car price reduction in the election manifesto, said Aishah. “The promises in the election manifesto had a very negative impact on the local automotive market as consumers were holding back their purchases,” she said. She said various industry players had made concerted efforts to discuss and resolve this issue, and adopted aggressive festive sales campaigns to woo back customers. The market has started to improve since June. “Bank Negara Malaysia has projected the economy will grow between 5% and 6% in 2013. Should this materialise, the local automotive industry will enjoy another robust and perhaps even a new record high for TIV,” Aishah said. Last year, TIV surged to a historical high of 627,753 units (2011: 600,123 units), an all-time high for the industry. It overtook the previous record of 605,156 units achieved in 2010.   For this year, MAA has forecast sales to reach 640,000 units. Of the total, passenger vehicles are expected to total 563,000 units and 77,000 units for commercial vehicles. This article first appeared in The Edge Financial Daily, on July 23, 2013.

https://theedgemalaysia.com/node/78838

Anak wants alleged police involvement in Felda attack probe

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KUALA LUMPUR (Feb 18): The National Association of Felda Settlers' Children (Anak) called on Bukit Aman today to investigate what it claims is a conspiracy by police and Felda to prohibit the pro-Pakatan Rakyat association from holding ceramah in the settlements. "We met with officers from Bukit Aman to hand over a memorandum to the police, specifically regarding the incident in Felda Sg Tengi, Hulu Selangor on Feb 4," Anak president Mazlan Aliman told reporters after the two-hour meeting. He said a memorandum was handed over to SAC Datuk Awaludin Jadid, deputy director of the federal police social extremist threat division, who received it on behalf of Inspector-General of Police Tan Sri Ismail Omar. "I had a heart to heart conversation with Datuk Awaludin and expressed our concerns on the restrictions placed on ceramah by Pakatan and Anak through road blocks at the roads entering the Felda settlements and on the disturbance during the ceramah itself," said Mazlan. He said he had submitted along with the memorandum a VCD containing a 15-minute clip that allegedly showed Felda Sg Tengi manager Alias Hussein discussing with police and Perkasa representatives about a plan to disrupt the Feb 4 ceramah. According to Mazlan, Alias allegedly said that a police officer from Kuala Kubu Baru had allowed them to create a "ruckus" at the ceramah. "Why was Perkasa in the meeting when they have nothing to do with the ceramah? They are not the organisers? The police must not allow outsiders to come in and take over the role of the police in the settlements. "The Perkasa people that came to disturb our ceramah were not even from the Felda settlement but outside," he said. He also condemned Felda for "clearly practising partisan double-standards" in restricting Anak programmes in the settlements. "Why are there double standards in holding ceramah in Felda settlements?  Umno and Barisan Nasional have frequently held ceramah and programmes, and in some areas they have received cooperation from Felda. "Why the sudden double standard when we want to hold programmes in the settlements?" he asked. Mazlan said the police must conduct a thorough investigation to protect the integrity of the force and clarify allegations that the Bukit Aman was colluding with Umno and BN. He said the police officer mentioned in the clip must be given a show-cause letter, and face disciplinary action if found guilty. "If the allegations that the district police officer from Kuala Kubu Baru had given orders are false then the Felda Sg Tengi manager must be brought to court for defamation and bring the police force into disrepute," he added.

https://theedgemalaysia.com/node/11699

AmIslamic Funds Mgmt targets RM300m more assets by March next year

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“We are open to customising and tailoring our products to meet the uniqueness of the Shariah-compliant demands of our clients,” she said at the launch of the AFMSB. She said the AFMSB would focus on customising the Shariah-compliant investment solutions for institutional mandates and unit trusts across all asset classes and structures including money market, sukuks, listed equities, private equities and real estate, specialising in global sukuks and Asia Pacific equities investments. The group’s FMD manages a total fund size of RM16.5 billion as at June 30, 2009. The decision to have AFMSB was to focus on Islamic fund management after it obtained the licence from the Securities Commission in January. AmInvestment Bank Bhd  managing director TC Kok said the licence enabled it to carry out the management of offshore and domestic Islamic financial instruments, formalizing 20 years of Islamic funds management.

https://theedgemalaysia.com/node/16578

Malaysia Trustmark introduced to M’sia e-commerce merchants and operators

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KUALA LUMPUR (May 31): The government is introducing the Malaysia Trustmark for Private Sector (MTPS) as a means of validating web security control of an organisation’s website that was involved in e-business or e-commerce. In conjunction with that, CyberSecurity Malaysia in collaboration with the Ministry of International Trade and Industry (MITI) have organised a special awareness session to introduce the Malaysia Trustmark for Private Sector (MTPS) to e-commerce merchants and operators in Malaysia. In a statement Thursday, CyberSecurity said the reason for the session was the realisation of the increase usage of e-commerce in Malaysia and the issue of trust as well as the need for reliable e-commerce transactions. “Information and communications technology (ICT) industry has experienced an exponential growth globally and in Malaysia with the strong policy support by the government and reliable infrastructure such as high speed broadband, ICT has become a part of everyone’s lives. “Organisations use ICT to expand and sustain their businesses and consumers use it for various reasons and one of them is online shopping,” it said. CyberSecurity’s chief executive officer Lt Col (R) Prof Datuk Husin Jazri said that the MTPS was initiated by CyberSecurity Malaysia to enhance trust in all e-commerce businesses in the country. “When organisations participate in MTPS, we will conduct an assessment of their e-commerce websites and transaction. “Once they surpass the assessment process, they will be awarded with the Malaysia Trustmark Certification,” said Husin. The Malaysian government through MITI has also appointed CyberSecurity Malaysia as the certifier of the Malaysia Trustmark for Private Sector. “Organisation that hold Malaysia Trustmark Certificates will be recognised as trusted and reliable e-commerce business and transaction merchants or operators,” said Husin. Organisations benefit from the Malaysia Trustmark as it assists to build trust in Malaysia e-commerce environment, promote good practice in cross border transactions, expand business opportunities and tangible market incentives to distinguish them from competitors. Meanwhile, for consumers, they will benefit in terms of strengthening the consumers’ confidence and reliance, reduces consumer’s risk of fraud and consumers would also enjoy the convenience of safe online shopping and services. “With the implementation of the MTPS, it will improve the competitiveness of Malaysian merchants in global market, enhance Malaysia’s reputation as a country operating in conformance to high levels of security assurance that monitors e-business activities to prevent fraud and other online shopping scams and increase trust as well as security of e-business in Malaysia,” it said.  

https://theedgemalaysia.com/node/91104

Asian stocks edge up, eyes on Portugal, U.S. jobs

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SINGAPORE/SYDNEY (July 4): Asian stocks clawed higher on Thursday but gains were tempered by concerns over political turmoil in Portugal and investor caution ahead of key events including Friday's U.S. jobs data. European shares were seen likely to inch higher. Capital Spreads forecast Britain's FTSE 100 up 12 points, Germany's DAX rising 19 points and France's CAC 40 gaining 8 points. MSCI's broadest index of Asia-Pacific shares outside Japan.MIAPJ0000PUS rose about 1 percent, recouping a portion of Wednesday's slide of roughly 2.5 percent. Regional shares were broadly higher, with Hong Kong equities last up 1.7 percent .HSI after sliding 2.5 percent the previous day, while Shanghai stocks. SSEC rose 1 percent. A modest bounce on Wall Street the previous day helped lend support to Asian stocks, market players said. Analysts, however, were cautious about the outlook for Asian equities, given the possibility that the U.S. Federal Reserve may start dialing back its monetary stimulus later this year, and also due to recent signs of an economic slowdown in China. "We are going to get these rebounds, but the general trend for Chinese equities in the foreseeable future is down for as long as a bottom in China growth is unclear," said Francis Cheung, CLSA's China-Hong Kong equity strategist. The gains in Hong Kong shares were made on low volumes due to July 4 Independence Day holiday in the United States, traders said. The U.S. nonfarm payrolls data on Friday could offer fresh clues on when the Federal Reserve will start scaling back its $85-billion-per-month bond buying program. "If anything, a relatively ordinary number would probably be more positive. The market could take a hit if the numbers are too strong," said Satoshi Okagawa, senior globalmarkets analyst for Sumitomo Mitsui Banking Corporation in Singapore, referring to the jobs data and the potential impact on Asian equities. Asian shares were battered last quarter as speculation grew the Fed might start tapering its bond-buying program later this year, prompting investors to position for an eventual end to the massive monetary stimulus, which has driven heavy flows into Asian assets. A political crisis in Portugal was another reason for caution. The Portuguese government is struggling to survive following the resignations of its foreign minister and finance minister this week, which could deprive it of a majority in parliament. Portugal's stock market. PSI20 dropped more than 5 percent on Wednesday, suffering its biggest fall in around three years, while government bond yields had briefly hit a high of 8.2 percent, their highest level since November 2012. Ructions in financial markets there threatened to spill over to neighboring countries and raise borrowing costs. That risk saw the euro fall as much as 1.5 percent against the yen at one stage to 128.66 on Wednesday. It has since recovered to 129.84. Against the dollar, the common currency eased 0.1 percent to $1.3002 but stayed above a five-week low of $1.2923 set on Wednesday. The erratic moves overnight were due in part to the reluctance of investors to hold large bearish positions going into Thursday's ECB meeting. While the ECB is expected to leave interest rates unchanged, it is likely to try to reassure investors rattled by new political stress in Europe and the U.S. Federal Reserve's plans to begin winding up its stimulus. Brent crude slipped from a two-week high as the threat of a disruption in supplies from the Middle East eased after Egypt's armed forces toppled the country's president to force a resolution to a political crisis there. Brent crude fell 0.2 percent to $105.53 a barrel after settling at its highest since June 19 on Wednesday. Spot gold edged up 0.3 percent to $1,254.81 an ounce, as worries over Europe and Egypt spurred safe-haven buying.        

https://theedgemalaysia.com/node/35658

APM Automotive ahead of expectation

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APM Automotive Holdings Bhd (Aug 19, RM4.85)Reiterate outperform at RM4.91 with revised target price RM5.70 (from RM5): Our FY2010F/11F earnings forecast remains intact. We continue to reiterate our “outperform” recommendation with our revised target price of RM5.70 (RM5 previously) based on FY2010 forecast EPS of 54.7 sen and PER of 10.4 times. We remain positive on APM given its solid free cash flow, attractive dividends and strong balance sheet amid a resilient net cash position currently at RM1.47 per share as at end-June. Key risks include: (i) slowdown of the economic recovery; (ii) lower-than-expected industry vehicle sales volumes; and (iii) weakening ringgit. APM’s annualised 1HFY2010 net profit of RM62.5 million is above our expectation and consensus, which accounts for 56.7% and 62.4% of our full-year forecast and market consensus respectively. As expected, APM declared an interim dividend of eight sen per share during the quarter under review. APM posted a strong performance in 2QFY2010 with pre-tax profit up 114.7% year-on-year (y-o-y) to RM54.1 million which includes a one-time price adjustment amounting to RM7.6 million on the back of higher revenue, up 47.6% y-o-y. By excluding the adjustment, its pre-tax profit would soar by 84.5% y-o-y. The positive growth performance was attributed to: (i) higher production volume and economies of scale; (ii) +141.6% y-o-y surge in its domestic contribution; (iii) better selling prices; and (iv) strengthening of functional currencies against the major trading currencies, which effectively lowered the import materials cost. The earnings before interest, tax, depreciation and amortisation margin rose by 5.4 percentage points to 19.9% in 2QFY2010, despite higher operating cost, up 38.5% y-o-y in 2QFY2010. In domestic operations, total vehicle production swelled 30% y-o-y to 150,636 units in 2QFY2010. APM benefitted from a higher revenue contribution from the domestic interiors and plastics segment, up 67.6% y-o-y, that reflects the supply of interior parts (especially high-value items like car seats) to Perodua’s Alza. Perodua will increase the production of Alza by 50% to 6,000 units per month in 2HCY2010. As for its overseas operations, although pre-tax profit fell by 12% y-o-y, revenue swelled by 60.3% y-o-y due to higher demand for new vehicles from Indonesia, up 78% y-o-y to 196,132 units in 2QFY2010.Nissan Motors’ (NM) plans a US$20 million expansion of its existing plant in Indonesia. Capacity is expected to double to 100,000 units per year while market share is set to expand from 4.4% to 10% by end-2012. We believe that APM would be the key beneficiary of NM Indonesia’s aggressive expansion plans given its status as a Tier-1 supplier to NM Indonesia via its 50% stake in the JCI-Armada-APM consortium. It plans to commence production of the high volume with highly localised Nissan model by November 2010. Adding on, APM has committed about RM68 million to expand production facilities in Vietnam to support Tan Chong’s expansion plan in Vietnam, which APM will eventually turn into its Nissan assembler and distributor for the Vietnamese market. — Inter-Pacific Research, Aug 19 This article appeared in The Edge Financial Daily, August 20, 2010.

https://theedgemalaysia.com/node/98889

#US Stocks Snapshot* Wall St ends up for 3rd day after strong data

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NEW YORK (Sept 6): U.S. stocks ended slightly higher, rising for a third day on Thursday after strong data indicated improving economic conditions, but caution capped gains ahead of Friday's payrolls report and its implication for the Federal Reserve's stimulus program. Based on the latest available data, the Dow Jones industrial average was up 6.15 points, or 0.04 percent, at 14,937.02. The Standard & Poor's 500 Index was up 1.94 points, or 0.12 percent, at 1,655.02. The Nasdaq Composite Index was up 9.74 points, or 0.27 percent, at 3,658.79. - Reuters

https://theedgemalaysia.com/node/88619

Hot Stock: Undervalued Malton share, warrant rise

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KUALA LUMPUR (June 11): Malton Bhd saw its shares and warrants rise among the exchange's most-active stocks after analysts said the property developer is undervalued. At 12:19pm, Malton shares went up 3.5 sen or 4.19% to 87 sen after reaching as high as 91 sen earlier. The second most-active counter had a trading volume of 60.34 million. At 12.30pm, the stock settled at 87.5 sen. Meanwhile, Malton warrants were traded 2.5 sen or 7.25% higher at 37 sen at lunch break with some 26 million warrants changing hands. The warrant was the ninth most-active entity on the bourse. RHB Research Institute Sdn Bhd analyst Loong Kok Wen said its target price of RM1.80 for Malton was based on a 50% discount to the developer's revised net asset value (RNAV). "At its current share price (last Friday’s close of 70.5 sen), the stock is trading at a massive 80% discount to RNAV. The undervaluations make Malton an attractive takeover target given its strategic landbank exposure," Loong said in a note. She also said Malton is "deeply undervalued" as it was trading at 0.5 time price-to-book value. The firm's latest reported book value stood at RM1.43 a share. "(Malton's) three big projects in the pipeline worth RM7.9 billion are all at prime locations, namely, Bukit Jalil, Batu Kawan and Pengerang. They make up 40% of RNAV. Malton could also potentially play a bigger role in Pusat Bandar Damansara (PBD)," the analysts said. Loong said Malton will build a shopping mall worth RM3.5 billion in Bukit Jalil which is comparable to Pavilion KL in size. She said Malton's other commercial and residential components will be easily sold given the strategic location, 5.3 million-population catchment, and buyers' confidence as reflected by the success of the Pavilion and Banyan Tree project in KL. However, Loong said Malton's earnings for financial year ending June 30, 2013 (FY13) may be weaker than the previous year's. This is due to the lack of project launches over the past one year. "Current earnings are mainly underpinned by RM205 million unbilled sales coming from three projects - Amaya Maluri which will be completed in June, The Cantonment in Penang and Nova Saujana from the property development division, as well as contract value of RM505 million from the construction division," she said. In FY14, RHB estimated that Malton's recurring net profit will grow 60.53% to RM61 million. Growth will come from the disposal of its commercial building at V Square in Petaling Jaya. "Apart from this en bloc deal, earnings from FY14 onwards will also be supported by the pipeline of launches, such as the Bukit Jalil, Pantai Dalam, Jalan Ipoh, Ukay Spring and Seri Kembangan projects," Loong said.

https://theedgemalaysia.com/node/92874

Highlight: Pua: Stop direct nego with Masteel on Johor rail project

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PETALING JAYA (July 18): DAP national publicity secretary and Petaling Jaya MP Tony Pua today kept up the heat on the issue of Johor's rail project, calling for an immediate stop for the direct negotiations between the government and steel manufacturer Malaysia Steel Works Bhd (Masteel) for the Johor Metropolitan Commuter Network (JMCN). In a press statement today, Pua pointed out that Masteel has admitted the rail industry required "very little specialised expertise" because according to the company "trains are relatively simple mechanical systems". "The company argued that it has 'experience in complex mechanical and electrical hardware and automation' which gives them 'the relevant experience in operating trains as trains are relatively simple mechanical system compared to steel mills'." The Edge Malaysia, in its June 17-23 issue, reported that Masteel CEO Datuk Seri Tai Hean Leng as saying that MCN would invest RM300 million in the project, and would receive a RM700 million soft loan from the government. On July 15, Pua had pointed out that Masteel has admitted it can recoup its investment in 12 years' time, raising the question of why the government needed to give MCN a 37-year concession period, allowing them to make net profit for 25 years. "The cost of the whole project is RM1 billion. The government is granting the concessionaire a RM700 million soft loan. If you can grant a 70% soft loan, why privatise it? Why not do it yourself? The idea of privatisation is to allow the private company to foot the capital?" Pua had questioned then. The DAP MP said based on the company's reply that experience in complex mechanical and electrical hardware and automation" is sufficient, there was little justification for direct negotiation as he was certain "scores of other companies" can do the job. He further added: "Therefore given Masteel feedback, the direct negotiations must stop immediately and Prime Minister Datuk Seri Najib Razak himself must insist that the project be tendered openly and competitively." Pua also welcomed Masteel’s clarification that the JMCN is still undergoing the process of obtaining the necessary approvals from various ministries and has not been granted full approval to undertake the project. "This clarification is welcome as we can now call upon the government to ensure that this RM1 billion project which has yet to be awarded, be tendered openly instead of being directly negotiated. "It is only by ensuring that all projects awarded by the government are at the best value, can the interest of the commuters and Malaysians be protected – e.g., the commuter fares will be at the lowest possible." Even though Masteel has replied via a media statement on Tuesday saying that other bidders were not prevented from submitting their bids to the government, Pua fired back saying: "Let me first make it clear that it is the right for any private company to submit any number of unsolicited bids for any types of projects to the government. "However, the unsolicited bids by these companies do not in themselves justify direct negotiations between the government and these companies."

https://theedgemalaysia.com/node/56711

OSK Research downgrades Tenaga to Neutral, sees losses ahead

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KUALA LUMPUR: OSK Research has downgraded Tenaga Nasional to a Neutral and it still sees the company reporting losses for 4QFY11 and 1QFY12. It said on Friday, Oct 28 it is maintaining its profit forecasts pending the announcement of compensation or a fuel cost pass through. It is maintaining its fair value of RM6.24. “Even with a potential write-back and the announcement of a new district cooling plant at KLIA2, we are unlikely to raise our FV substantially in the absence of a fuel cost pass through mechanism. As such, we maintain our DCF based FV for now, and downgrade the counter to a NEUTRAL given the limited upside after the recent price rally,” it said. Tenaga will release its fourth quarter results on Friday evening. “We maintain our estimates pending this evening’s results release although we note that without compensation from Petronas, a disappointment is still likely. Given the limited upside to our RM6.24 DCF derived fair value, we downgrade our call on Tenaga Nasional to Neutral. A clear fuel cost pass through would have to be in place before we upgrade our FV substantially,” it said.

https://theedgemalaysia.com/node/97610

Corporate results

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KUALA LUMPUR: Carlsberg Brewery Malaysia Bhd’s net profit dropped to RM30.9 million on lower revenue of RM344.5 million for the second quarter ended June of 2013 financial year (2QFY13). This was compared with RM37.7 million in net profit on revenue of RM383.4 million revenue for 2QFY12. The brewery said the lower revenue was due to lower sales volume on softer demand, thanks to the macroeconomic environment. The lower revenue was partly offset by lower operating expenses. For the first six months, net profit fell to RM81.4 million from RM90 million previously. Eversendai Corp Bhd suffered a dip in net profit to RM16.5 million for 2QFY13 ended June, a 46% drop from RM30.5 million in 2QFY12. Its Middle East and India segments recorded lower gross profits of 16.7% and 73.9% respectively. However, gross profit in the Malaysian segment rose 187.1%, which was attributed to the Manjung and Tanjung Bin 4 power plant projects. For the first six months, net profit dipped to RM40 million from RM57.6 million a year ago. Electronics manufacturer services Inari Amertron Bhd posted a rise in net profit to RM13.1 million for 4QFY13 ended June compared with RM5.4 million for 4QFY12. Revenue rose to RM67.7 million from RM41.8 million previously. The rise in profit was due to increased orders from major customers. The group enjoyed a higher utilisation of production capacity due to lower fixed costs, thanks to the higher trading volume. For the full year, net profit jumped to RM42 million from RM19.86 million a year ago. The company proposed a dividend of 1 sen per share. Tropicana Corp Bhd posted a slight drop in net profit to RM38.3 million for 2QFY13 ended June compared to RM38.8 million for 2QFY12. However, revenue climbed to RM362.1 million against RM117 million. Its higher revenue was mainly driven by the strong sales performance recorded in the greater Kuala Lumpur area and Iskandar Malaysia. For the six-month period, net profit jumped to RM82.1 million from RM51.1 million a year ago. Property developer Sentoria Group Bhd posted a lower net profit of RM7.7 million for 3QFY13 ended June compared with RM13 million for 3QFY12. Revenue rose to RM55.4 million from RM38.5 million. The lower profit was attributed to higher operating costs in the leisure and hospitality division, and construction of low-medium cost housing project (government housing policy). For the nine-month period, net profit fell to RM18 million from RM31 million a year ago. GD Express Carrier Bhd reported a higher net profit of RM4 million for 4QFY13 ended June compared with RM2.9 million for 4QFY12. Revenue rose to RM35.7 million from RM31.4 million previously. The rise in revenue and profit was due to an increase in business volume and the improvement in operation efficiency. For the full year, the company registered a higher net profit of RM13.6 million against RM8.7 million previously. Gabungan AQRS Bhd saw a higher net profit of RM23 million for 2QFY13 ended June against RM9 million for 2QFY12. Revenue jumped to RM103.3 million from RM61.6 million before. In a statement to Bursa Malaysia yesterday, the company said the rise in profit was due to higher revenue from construction and property development as well as a one-off pre-tax gain from land sale. For the first six months, net profit surged to RM30.6 million from RM14.7 million a year ago. Petra Energy Bhd’s net profit rose to RM14.7 million for 2QFY13 ended June from RM9.1 million for 2QFY12, mainly due to the recognition of a provisional negative goodwill arising from the acquisition of a wholly owned subsidiary in the marine offshore support services segment. Revenue fell to RM125.9 million in the quarter from RM172.6 million in the same period last year. For the first six months, net profit rose to RM16.89 million from RM16.25 million a year ago. This article first appeared in The Edge Financial Daily, on August 28, 2013.

https://theedgemalaysia.com/node/34525

HDD makers continue to fall

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KUALA LUMPUR: JCY International Bhd and Notion VTec Bhd continued their downward trend last Friday, as Western Digital’s dour quarterly forecast warning sent stocks of hard-disk drive (HDD) manufacturers reeling. JCY and Notion VTec are fellow manufacturers of HDD components, although the latter has also diversified into production of camera and automotive parts. News reports on July 21 had it that international HDD maker Western Digital attributed its forecast profit dip to laggard spending patterns, European debt worries and lower prices. “Initially, JCY was priced higher in comparison with its peers, so the sell-down was not unexpected. However, at current price-to-earnings ratio (PER) levels, it seems to be more in tandem. Further movements in JCY’s share price will likely be mirrored in other industry peers as well,” said an analyst. To recap, JCY has seen a dramatic pullback since hitting a high of RM1.98 on May 3. Enroute to its listing, JCY initially had an indicative offer price of RM2 per share, tagging it at a historical PER of 19.7 times. That had looked expensive compared with Notion VTec, which was then trading at a historical PER of only 11.8 times. JCY eventually listed with an institutional IPO price of RM1.60, the low end of the RM1.60 to RM2.20 range indicated by the arrangers. The retail tranche was priced at RM1.52. Currently, JCY’s estimated forward PER is 8.10 times, compared with smaller companies Notion VTec and Dufu Technology Corp Bhd, with 8.01 times and 5.5 times, respectively. On Friday, JCY closed at RM1.26, down six sen from RM1.32, while Notion VTec ended at RM2.62, falling six sen from RM2.68, against the general upturn of the market. Technology stocks on Bursa Malaysia Securities were mostly in the red or unchanged, amid news that Japanese manufacturing activity expanded in July at its slowest pace in four months. Moreover, there were weaker outlook reports on the international front from technology firms Nvidia Corp and Symantec Corp. Analysts have mixed forecasts on the technology sector, with CIMB Research maintaining an overweight on semiconductors, while the majority of research houses, including MIDF Research, are cautious. “We are not optimistic about the technology sector in the second half of 2010, given that some overseas tech companies have guided for a slowdown and some others revised their outlook downwards,” said an MIDF Research analyst when contacted by The Edge Financial Daily last Friday. He said the research house believed this trend would likely spill over into the local technology sector in the short term. For long-term growth, research houses said the general outlook beyond the next six months was positive. “There is a very strong link between the US recovery and the technology industry. We foresee slower and normalised growth, unlike the aggressive levels experienced during the technology boom years,” said another analyst. On the other hand, according to CIMB Research’s July 26 report, the corporate replacement cycle was kicking in for the semi-conductor industry. “Also, demand in key end-user markets is still firm, helped by new product launches, and emerging markets are fuelling growth, becoming the largest buyer of chips globally,” the report said. According to CIMB Research, the top 10 suppliers registered sales improvement in 1QFY10 of 2% over 4QFY09, from US$69.23 billion (RM220 billion) to US$70.59 billion. However, CIMB Research added that there was an increased risk of a double-dip recession if the European debt crisis continued and US employment stayed high. This article appeared in The Edge Financial Daily, August 2, 2010.

https://theedgemalaysia.com/node/46629

Gamuda shares up ahead of results

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KUALA LUMPUR: Gamuda Bhd shares rose on Thursday, March 24 following AmResearch raising its target price to RM4.25 (from RM4.20 previously) and maintaining its Buy call on the stock. At 4.30pm, Gamuda was up six sen to RM3.79 with 3.47 shares done. AmResearch said the target price revision was to account for maiden contributions from the Sg. Buloh-Kajang MRT line as well as the Madge Mansion development, but partly mitigated by the likelihood of further delays to the double-tracking project. The increasing newsflow on the Klang Valley MRT project would likely re-galvanise investor interest in Gamuda, it said. The 51km-Sg. Buloh-Kajang route – the first major line for the new MRT system – appears set to take off. To be sure, pre-qualification tenders may be out next month ahead of the targeted commencement of construction works by July 2011, it said. “There are strong indications that the overall cost for the Sg. Buloh-Kajang line could be higher than expected at RM20 billion (our earlier estimates: about RM12 billion). “By extension, this may imply more scope of works for Gamuda for the entire system – which will reportedly cost over RM50 billion against the initial estimate of RM36 billion,” it said. Gamuda is expected to announce its 2QFY11 results today.

https://theedgemalaysia.com/node/17020

Asia-Pac corporate defaults close to peaking

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"The rising default rate is expected to continue, but now looks near its top with the Asian speculative grade trailing 12-month non-finance corporate default rate estimated to peak at 18%-20% in 4Q2009," according to Moody's group credit officer/corporate ratings Asia Pacific Clara Lau on Aug 26. "Subsequently, the rate is expected to fall sharply to around 10% in 2Q2010, while it was -- as of end-July -- 16%, well above the 2.7% for all of 2008," she said. Lau also said the estimated high-yield corporate default peak would be one of the highest, if not the highest for Asia-Pacific's rated non-finance corporate portfolio since we began tracking this in Asia in the early 1990s. "The estimate reflects the severity of the current global downturn and the fact that the rating mix has changed dramatically with proportionally more lower-rated high-yield corporate issuers in the region's portfolio," she added. Lau was speaking on the release of a Moody's report -- which she authored -- on projecting the default trend for rated non-finance high-yield corporates in Asia-Pacific (ex-Japan). The report looks at trends evident since the Asian financial crisis in 1997, discusses the acceleration in corporate default rates and examines the application of Moody's Credit Transition Model, a formal default forecasting model, to Asia. Since the start of 2009 to end-July, there were 10 rated non-finance corporate defaults (totaling US$3.3 billion in debt), five times the number for all of 2008. All the defaulters were speculative-grade issuers and the overwhelming majority was B-rated or below one year prior to their default. Medium-sized listed Hong Kong companies with predominantly Chinese operations accounted for the majority of these defaults.

https://theedgemalaysia.com/node/85310

Stocks to pick post-GE13

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KUALA LUMPUR: Investor interest is seen returning to government-linked corporations (GLCs), and the construction and oil and gas (O&G) sectors as Barisan Nasional’s victory in the 13th general election (GE13) means that there will be continuation of key infrastructure projects along with major policy decisions concerning the economy, said analysts and fund managers.   “We believe our local bourse will continue its ascension as investors can now start deploying their cash to the market, which has been sitting on the sidelines waiting for the outcome of the election,” Hwang Investment Management Bhd (HwangIM) chief investment officer David Ng said in a statement yesterday. He said that post-election, companies involved in projects that promote nation building and economic development “will perform and attract investors”. This is especially so for companies in the O&G, financial and construction sectors. Even the media sector is expected to benefit from stronger consumer confidence and discretionary spending. According to Ng, HwangIM has since end-February gradually been deploying excess cash to buy financial, O&G and some property development stocks. He noted that Malaysia’s strong economic fundamentals, which include good foreign direct investments, a positive investment cycle and strong consumer confidence, would also drive investors into buying stocks. He is, in fact, expecting a surge in buying activities led by foreign and local institutional investors who are attracted to Malaysia’s lagging market performance versus the regional peers. AmResearch Sdn Bhd is of the view that the removal of election risks would spur the return of investor risk appetite with a shift in emphasis to the cyclical sectors. “We expect the initial wave of market re-rating to be liquidity-driven from the redeployment of institutional monies on the sidelines to increase equity exposure,” said the research house in a note yesterday. “This would take place before a meaningful upturn in the earnings revision cycle from renewed optimism about the investment cycles with the implementation of previously-delayed cornerstone projects.” AmResearch said that the continuity of the BN government places the big cap market proxies namely CIMB Group Holdings Bhd, Tenaga Nasional Bhd (TNB), Axiata Group Bhd and Sime Darby Bhd in an attractive position. “CIMB has been a laggard relative to other banking stocks because of its perceived linkage to the establishment and should therefore get a kick from a reversal in sentiment and regain its status as a high beta stock,” it said. The research firm added that TNB offers a cheaper exposure to the rising market with stronger operating dynamics compared to the telco stocks. “We also believe that Sime Darby’s share price would soon be pricing in an imminent recovery in the crude palm oil [CPO] pricing cycle as CPO inventory has peaked and is already on the decline now,” said AmResearch.   It noted that previously, construction stocks were going through a lull due to uncertainty over the general election and repercussions on new contract flows. However the balance of risk is now on the upside, with the research firm giving a “buy” call on IJM Corp Bhd, WCT Bhd and Gamuda Bhd. “We believe that the perceived risk premium on construction stocks should dissipate on expectations of a resumption of delayed projects, including the West Coast Highway as well as several new projects such as the high-speed rail link to Singapore,” said AmResearch. From the equity market’s standpoint, it said the outcome of GE13 was within consensus expectations, adding that it had kept its corporate earnings growth estimate at 10% for 2013. “The erosion in majority for the BN is a mild negative and we believe this outcome is the best compromised case for the equity market,” the research firm added. This article first appeared in The Edge Financial Daily, on May 7, 2013.

https://theedgemalaysia.com/node/18644

Party goes on at Lan Kwai Fong

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Once upon a time a backwater, Hong Kong’s famed Lan Kwai Fong (LKF) — derived from the names of flowers — is now the city’s most famous watering hole. At its best, this is the place to be merry and savour Hong Kong’s trendy nightlife till the wee hours, but at its worst, a seasoned British journalist gives his perspective: “LKF is a preservative for ageing Westerners who refuse to grow up. During the Rugby Sevens, look at the gobsmacked faces of locals as they scurry quickly by the area. It is a look of bewilderment and horror.” As he speaks, a shiny silver, open-top Mercedes-Benz sports car pulls up in front of the bar where we are sitting, and two ladies dressed in little pieces of fabric jump out of the car. Behind any bold venture, there is usually a genius. For LKF, there was Allan Zeman, the chairman and founder of Lan Kwai Fong Holdings Ltd, who is popularly known as the godfather of LKF. A German-born Jew who grew up in Canada, Zeman lost his father when he was eight years old. He started working in odd jobs at 10 and later, dropped out of college. He went on, however, to make millions in the clothing import business and moved to Hong Kong to be closer to China where he sourced clothes for export. In the early years, one problem he faced was that there was no proper Western restaurant to take his guests to. Hong Kong was becoming more cosmopolitan but there were limited bars and restaurants that catered to expatriates. Wanchai, the most prominent nightlife area then, was becoming a little seedy. At that time, LKF was occupied by flower shops and textile factories. It was not living up to its real estate potential, given its location a hop and skip away from Hong Kong Island’s central business district. So, in the early 1980s, Zeman took a chance and started California Restaurant at the corner of D’Aguilar Street in the LKF area. The gods of fortune smiled on him and California did roaring business. This prompted Zeman to raise HK$32 million to acquire and refurbish more properties in LKF. He tore down some buildings and in place, built taller buildings to enhance yield, while other buildings were given a facelift. Restaurants were located in the basement with open windows to maximise use of space. Upper floors housed fitness studios, fashion boutiques, offices, and serviced apartments. Given Zeman’s Midas touch, Tung Chee Hwa, then the chief executive of Hong Kong, asked him to turn around the ailing Ocean Park in 2004, and give Disneyland Hong Kong a run for its money (which is how he earned his nickname as Hong Kong’s Mouse Killer). While Zeman is often spotted at LKF at nights, the entertainment property developer is a teetotaller. In an email interview with City & Country, he says, “I only drink on very rare occasions, such as toasts at special celebrations. I’ve been in the business for so long that I can have fun without drinking!” Location atmosphereLKF occupies three blocks of buildings that range from 10 to 16 floors, stretches for 1.5 km and offers approximately 500,000 sq ft of space. Zeman owns about 68% of the space in LKF, including nine restaurants and bars — California Restaurant, Lux, C bar, The Whiskey Priest, 2121 Bar, Indochine 1929, Thai Lemongrass, Kyoto Joe, and Tokio Joe. Other F&B groups with outlets in LKF are Igor’s and Ninety Seven. LKF is big but yet not too big, with a sufficient concentration of over 100 bars, restaurants, clubs and shops. Being the first expatriate watering hole has been its biggest selling point. Touted as a must-go destination for tourists and working professionals, LKF is only a short walk up the hill along D’Aguilar Street, off Queen’s Road Central area, where major multinational companies and banks are located. An important point is that it is within walking distance and on the way to Mid-Levels, the most popular residential area for expatriates and upper-income professionals. While the restaurants are about 3,500 sq ft in size, the bars are designed to be tiny, which means limited standing space inside. The crowd has to spill out onto the pavement, thus adding to the lively atmosphere. Zeman believes that patrons come to LKF because they are attracted to the area’s uplifting, casual yet hip atmosphere. The colourful neon lighting and noise cheer people up and distract them from daily worries, he says. Adds my British journalist friend, “It is one place where it is possible to spend, literally, any amount of money between the hours of midnight and three in the morning…when drunk, of course.” Joe Lin, senior director of retail services at CB Richard Ellis (CBRE) Hong Kong, says LKF is a great place for social gatherings and getting to know people. It is a favourite hangout for the upper class, celebrities and models. A Malaysian who works at Morgan Stanley Hong Kong hangs out at Fong or Lux once a week, and recommends C bar for people watching. Many locations have tried to copy LKF but it has somehow managed to maintain its pole position. In other places, there are restaurants scattered to form a themed F&B area, for example, Soho East in Lei King Wan, Soho in Central, Star Street in Wanchai, Taikoo Place area in Quarry Bay, Knutsford Terrace in Tsim Sha Tsui, and Queens’ Road East Hopewell Centre area. LKF is a relatively safe area and its outlets have better ambience and the longest operating hours, Lin explains. People are always going to want choices, and we have plenty of that in Hong Kong, Zeman says.A Singaporean investment banker who lives in Mid-Levels usually dines in Soho as he thinks the area has better restaurants but he and his regular drinking companions prefer happy hours at LKF due to its atmosphere. Zeman does not believe in imposing strict tenant mix guidelines because he wants to encourage creativity. He has allowed a mix of F&B tenants that range from premium restaurants with long waiting lists to outlets that offer quick, cheap and tasty meals. Some bars offer good deals on beers, others have specialist cocktails, while there are also clubs with exclusive entrance policies. LKF has something for everyone — from Chinese, Thai, Japanese, Vietnamese to Italian and upmarket French restaurants, as well as cheap and cheerful restaurants in “Rat Alley” that serve Indian and Malaysian food. What’s more, alcohol has become cheaper in Hong Kong. Last year, when the government removed taxes on beer and wine, Lan Kwai Fong Entertainments, a subsidiary of Lan Kwai Fong Holdings, reduced its alcohol menu prices by 4% to 20%. During happy hours, a pint of beer costs about HK$50 (RM22), or about about 50% cheaper. To attract patrons, happy hours may start from 5pm and extend to 10pm. Word-of-mouth marketingBy far the most effective promotion has been through word-of-mouth. People will bring their friends from out of town, or have their birthday, stag or hen nights, and even team building events at LKF, Zeman says. Thanks to travel websites, blogs and social media sites like Facebook, photos of the LKF street sign and videos of lively parties at LKF have reached people across the world, adding to the allure of the place. There are about 30 groups or fan pages on Facebook created by patrons and party organisers, which is an impressive number. In contrast, a search on facebook for a well-known row of bars and clubs in Kuala Lumpur yielded less than 20 results, mainly pages created by individual outlets. At the heart of it, Zeman says LKF is about people having fun and keeping them interested. And there must be something going on that keep them entertained and surprised each time they visit. For one, there are the seasonal festivals such as the LKF Street Carnival, Beer Festival, Halloween, Valentine’s Day, Christmas, New Year’s Day countdown, and also Canada Day, where LKF will put up decorations and provide free entertainment. Booths are also set up in front of bars and restaurants for people to sample what each outlet has to offer. When it comes to marketing, the whole is greater than the sum of its parts. An LKF Association — of which Zeman is the president — was set up as a platform for outlets to work as a community, and to raise funds for events through sponsorship and advertising. By working together, there is a more compelling story to sell to sponsors, and fixed advertising costs can be shared. Says Zeman , “No other area in Hong Kong has the same community feeling as LKF, where all the venues work together through the association to continuously improve the district.” Rents have not dropped at LKFAccording to CBRE’s Lin, after the financial meltdown, the F&B sector in Hong Kong experienced a drop in sales except for fastfood and the mass-market type restaurants. But he believes the situation has improved in the last two months due to the feel-good factor from the stock market rally. Zeman says there was a 5% to 10% decline in F&B customers during the worst of the crisis, but adds that business has picked up lately. The rent of a ground-floor restaurant is HK$180 to HK$250 psf while upper floor restaurants fetch HK$30 to HK$50 psf, Lin estimates. Rents in the past 12 months have been relatively stable and increases are not expected due to external challenges, including a smaller expatriate community and high unemployment. The eternal optimist, Zeman maintains a positive view. He says, “Rents have not really dropped in the past year since business has not been too heavily affected. With the light at the end of the tunnel getting brighter and brighter, I foresee continued strong sales and rents into 2010.” LKF going placesZeman’s children, Marisa and Jonathan, help him run the business although he is far from retired. Jonathan is chief operating officer of the LKF group while Marisa is a director of Lan Kwai Fong Entertainments. Zeman believes it is not just about keeping the business within the family. The new managers, he says, must have the right mentality and creativity for the continued success of LKF. “My son and daughter definitely have that in them, both genetically and from growing up in LKF.” Zeman has declined numerous invitations by various cities to help them create an LKF. It requires many special elements to make it work, he says. He finally agreed to work on a project in Chengdu, which will open at the beginning of 2010. It will be like LKF with more shops and full day entertainment. On whether there are plans to list Lan Kwai Fong Holdings or cash out, Zeman says, “LKF is really where I began in Hong Kong all those years ago. It’s something special I created and it will always be special to me. Besides, it would be impossible to put a price on it!” This article appeared in City & Country, the property pullout of The Edge Malaysia, Issue 772, Sep 14-20, 2009.

https://theedgemalaysia.com/node/16211

Thailand police investigate death of Tata Motors chief Slym

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(Jan 27): Thailand police said they’re investigating the death of Tata Motors Ltd. Managing Director Karl Slym, head of the carmaker’s Indian operations, who fell from the Shangri-La hotel in Bangkok and died. The police are awaiting forensic-test results before determining the circumstances surrounding his death, Sinlert Sukhum, superintendent at the Yannawa police station that’s in charge of the case, said in an interview today. A letter was found in his room, though authorities haven’t determined who wrote it or whether it’s a suicide note, he said. Slym, 51, was in Bangkok to attend a board meeting of Tata Motors’s Thai unit, the company said yesterday, though it didn’t provide details. Minari Shah, a Tata Motors spokeswoman, said she had no updates since yesterday’s statement and that no decision has been made on Slym’s replacement. Tata Motors fell 3.4 percent to 357.90 rupees as of 9:29 a.m in Mumbai trading. For India’s biggest automaker by revenue, Slym’s death creates a leadership vacuum at the maker of the sub-$3,000 Nano car at a time when the country’s passenger- vehicle industry is bracing for its first fiscal year of declines in more than a decade. Slym, who joined Tata Motors in 2012 after a 17-year career at General Motors Co., was in charge of the company’s India business and sought to spur demand for the Nano, once marketed as the world’s cheapest car, by repositioning it as a second vehicle. Ralf Speth heads the bigger and more profitable Jaguar Land Rover operations, which Tata Motors bought from Ford Motor Co. in 2008 for more than $2 billion. Earnings Dichotomy “Karl was beginning to make long-term changes at Tata Motors,” Vikas Sehgal, managing director for the automotive sector at Rothschild & Sons in London, said in a telephone interview. “His loss will be felt deeply by Tata Motors.” Slym was in Bangkok with his wife, who hasn’t been questioned because she’s in shock, Sinlert said. While Tata Motors was seeing a recovery in overall earnings -- profit surged 71 percent in the three months ended September and analysts estimate net income doubled last quarter -- they were driven by the Jaguar Land Rover operations. Tata Motors’s standalone operations that were headed by Slym posted a loss during the latest fiscal half as products such as the Nano failed to attract customers. In an interview last year, Slym said he was seeking to breathe new life by adding improvements into the egg-shaped Nano and that Tata Motors overhauled its manufacturing process to ensure fewer problems after cars roll off the assembly line. Business Empire Tata Motors is the automotive arm of the Tata Sons Ltd. group, a business empire headed by Cyrus P. Mistry that includes more than 100 companies in industries ranging from steel to call centers and chemicals. “Karl was providing strong leadership at a challenging time for the Indian auto industry,” Mistry said in a statement yesterday. The Society of Indian Automobile Manufacturers, which has forecast a drop in passenger-vehicle sales this fiscal year, said this month the industry was still going through a rough patch as an economic slowdown damps demand for cars and SUVs. Slym was born in Derby, central England, and graduated in 1984 from his post-secondary education in production engineering at the city’s University.Before Tata He started his career as a general manager at Toyota Motor Corp., before moving to GM in 1995. He held various roles with the U.S. carmaker in locations including in Poland, Germany and Canada. Following his move to India, he was featured in GM’s advertising campaign in 2008 to 2009. Slym oversaw the sale of a 50 percent stake in GM India to SAIC of China and announced the company’s plans to enter the light commercial vehicle market in India. Slym was the second GM executive to be appointed managing director at Tata Motors. The company previously hired Carl-Peter Forster in 2010 from GM in Europe. Forster quit after less than two years at the company. Slym, who was a soccer and cricket fan, is survived by his wife, Sally, whom he married in 1984.

https://theedgemalaysia.com/node/32579

TdC says geared for growth

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SHAH ALAM: Time dotCom Bhd (TdC) is poised to enter the second phase of its turnaround initiative following its return to the black at the end of financial year 2009 and posting its fourth consecutive quarter of profits in the first quarter of this year, said its CEO Afzal Abdul Rahim. Speaking after TdC’s AGM here yesterday, he said the data business was expected to remain as the main growth engine. TdC posted a net profit of RM18.77 million in its first quarter ended March 31, 2010 (1QFY10) versus a net loss of RM34.69 million a year earlier. Basic earnings per share totalled 0.74 sen, while net asset value as at March 31, 2010 was 44 sen. The company had said the swing in the performance was a result of cost-cutting and de-gearing measures, while recognising a RM14.9 million dividend income from its investment in DiGi shares. With broadband, Internet, and managed services, TdC’s data business contributed 60% of the company’s revenue in 2009. In 1QFY10, the product segment showed a double-digit growth of 14% year-on-year. Afzal said with enhanced data product offerings and the high reliability of its network, TdC was looking at chipping away market share in vertical sectors such as wholesale, corporate and government. Backed by its full-fibre optic transborder network, he said TdC had made headway in the wholesale market segment. As one of its biggest revenue contributors, TdC’s wholesale business grew by 29% in 2009 revenues and 39% year-on-year in 1QFY10. He said TdC had introduced the country’s first 50Mbps fibre-to-home connectivity at Mont’ Kiara, KL. This article appeared in The Edge Financial Daily, June 29, 2010.

https://theedgemalaysia.com/node/92614

#Update* Magna Prima to raise funds

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KUALA LUMPUR (July 17): Magna Prima Bhd plans to raise funds, a move which could have triggered the sharp rise in the share price of the property developer yesterday. Magna Prima said this in reply to Bursa Malaysia's query on gains in the former's shares. "To the best of our knowledge and after making due enquiry with the directors and major shareholders of Magna Prima on seeking cause of the unusual market activity in the company’s shares, the board of directors of Magna Prima wishes to clarify that Magna Prima is currently in the midst of considering a potential fund raising exercise for the company. “The company will make the necessary announcement to the exchange at the appropriate time upon finalisation of the terms and timing of the proposed fund raising exercise, Magna Prima said. Bursa Malaysia had yesterday queried Magna Prima after the stock rose as much as 34% to hit limit-up. Magna Prima had risen as much as 30 sen to RM1.18 before closing at RM1.16. Some 8.5 million shares changed hands. Today, the stock rose further before paring gains. At 2.32pm, Magna Prima was traded at RM1.20 with some six million shares done. The stock had earlier jumped as much as 17 sen or 15% to RM1.33.

https://theedgemalaysia.com/node/2221

TSR gets RM136.7m jobs

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KUALA LUMPUR: TSR Capital Bhd has been awarded two government-related construction contracts totalling RM136.7 million. TSR said on March 19 its subsidiary TSR Bina Sdn Bhd would build a rehabilitation camp in Kuantan for RM45 million and Universiti Teknologi Mara’s (UiTM) Terengganu branch in Bukit Besi for RM91.7 million.

https://theedgemalaysia.com/node/52643

CBIP unit wins RM171m contract

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KUALA LUMPUR: CB Industrial Product Holding Bhd’s (CBIP) unit has won a RM171 million contract from the Housing and Local Government Ministry to supply 100 units of fire rescue transport fitting and accessories. In a filing with Bursa Malaysia yesterday, CBIP said its wholly -owned subsidiary, AVP Engineering (M) Sdn Bhd, has been awarded the contract to supply and install the fire rescue transport C/W fitting and accessories to the Fire and Rescue Department. AVP Engineering is primarily involved in the retrofitting of special-purpose vehicles. CBIP closed down five sen to RM4.16 with 1.1 million shares traded yesterday. This article appeared in The Edge Financial Daily, August 3, 2011.

https://theedgemalaysia.com/node/65389

Island LandCap plans exclusive waterfront villas in Batu Ferringhi

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KUALA LUMPUR: Penang developer Island LandCap Properties Group is planning to build three exclusive waterfront villas in the popular Batu Ferringhi area in Penang. The villas will be built based on the build-then-sell concept and are expected to start construction by the second quarter of 2013. Executive chairman Oon Weng Boon told The Edge Financial Daily that the 50,000 sq ft tract on which the villas will be built was acquired early this year. The European-style villas will be within a gated and guarded area and will offer built-ups of about 9,000 to 10,000 sq ft and are indicatively priced between RM15 million and RM25 million. Each of the 4-storey villas comes with a home lift. “This is a blue chip property… a class above the ordinary. I am not in a hurry to sell them. Marketing for the villas will start early next year and we are looking at buyers from Singapore, Hong Kong and the UK,” Oon said. The first project by the developer is Taman Tun Hussein Onn in Seberang Jaya, Seberang Perai in 2001, with a gross development value (GDV) of RM30 million. Among its completed projects is Cassia Resort Condominium in Jalan Raja Uda, Butterworth, which was one of the few projects there built with full condominium facilities. Launched in 2006 for RM150,000 with built-ups of 1,150 sq ft, units there have recently changed hands on the secondary market for RM300,000 each. In total, the developer has completed projects with a total GDV of RM400 million. Meanwhile, the developer is currently developing an integrated condominium development on a 7-acre (2.8ha) plot in Butterworth which is said to be the first project in Butterworth with a private water park. It comprises two medium-cost condominium developments namely Pinang Laguna (27-storey) and Palma Laguna (38-storey), as well as Laguna Indah apartment (16-storey) with GDV of RM80 million, RM100 million and RM20 million respectively. Pinang Laguna and Palma Laguna, which were launched in 2010 and early 2011, are fully sold. The two towers share the 50,000 sq ft facilities area and Pinang Laguna units were sold around RM190 psf to RM290 psf. Palma Laguna units with an average built-up of 1,070 sq ft were sold between RM250 and RM290 psf. Laguna Indah, offering 220 units, has been open for registration since last month. On the Penang property market, Oon said: “I think it is a very vibrant market and generally, properties are reasonably priced. For Island LandCap, my short term plan is to make the company an IPO-ready company by 2016 or 2017.” Penang-born Oon, who is a Universiti Sains Malaysia physics graduate, started out as a negotiator for Henry Butcher in 1994 upon graduation. “I always had a passion for property development. Growing up, I used to admire the new developments around me as well as the entrepreneurship of the developers. After a little over six years as a negotiator, I quit and started my own company. I think it is important to be passionate in what you do. When you promise the buyers a property that is of good quality, make sure you deliver on time,” he said. This article appeared in The Edge Financial Daily July 6, 2012.

https://theedgemalaysia.com/node/9965

CIMB Research rates Daibochi and Tomypak as Outperforms

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KUALA LUMPUR: CIMB Equities Research is maintaining its Overweight on the companies in the flexible packaging sector and continue to rate Daibochi and Tomypak as Outperforms. It said on Thursday, April 1 companies in its coverage, Daibochi and Tomypak, demonstrated their ability to pass on rising raw material costs to their customers, going by the double-digit pretax margins they recorded for four straight quarters. “This profit margin trend should continue in 2010, driven by similar catalysts as in 2009, which included food safety and rising demand for metallised film,” it said. CIMB Research said it made no changes to its earnings numbers or target prices. Daibochi's target price of RM4.60 is based on 12x CY11 P/E. For Tomypak, it value the stock at a 30% discount to Daibochi, i.e. 8x CY11 P/E. This gives an unchanged target price of RM4.66 for Tomypak. Potential re-rating catalysts for both stocks include i) further margin expansion over the next few quarters, ii) contracts from major non-F&B companies and, iii) attractive dividend yields of 5%-6%.

https://theedgemalaysia.com/node/76723

Dijaya announces senior management changes

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Kuala Lumpur: Confirming an earlier story by The Edge Financial Daily, Dijaya Corp Bhd announced key management changes involving Tan Sri Danny Tan, his son Dickson Tan, Datuk Yau Kok Seng and Datuk Tong Kien Onn. In an announcement to Bursa Malaysia last Friday, the company said Danny Tan has been redesignated executive vice-chairman from his previous post of director and CEO. Replacing him as director and CEO is Yau, formerly group managing director of Hong Leong Industries Bhd. Tong, meanwhile, resigned as Dijaya’s managing director and is replaced by Dickson Tan. Dickson was Dijaya’s business development manager, then appointed to the Dijaya board in May 2009 and subsequently appointed as executive director in April 2010. Yau will join his former colleague, Koong Wai Seng, who is currently a director of Dijaya. Koong was director of investment with 1Malaysia Development Bhd prior to joining Dijaya. Dijaya had recently completed an amalgamation exercise, which involved the injection of Tan’s privately held assets worth some RM1.1 billion into Dijaya, transforming the company into one of the largest property companies in the country in terms of market capitalisation. Dijaya targets to launch properties worth RM2.3 billion and RM2.5 billion in 2013 and 2014 respectively. As at Sept 30, 2012, Dijaya generated some RM288.7 million cash from operations. Its cash pile stood at RM155.84 million.   This article first appeared in The Edge Financial Daily, on Jan 7, 2013.

https://theedgemalaysia.com/node/24090

November CPI up 0.5% year-on-year to 112

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PUTRAJAYA: The Consumer Price Index (CPI) for the period January to November 2009 increased by 0.5% to 112 compared with that of 111.4 in the same period last year, said the Department of Statistics Malaysia. When compared to the same month in 2008, the CPI for November 2009 registered a decrease of 0.1% from 112.9 to 112.8, it said. In a statement Dec 23, it said the decline was due to changes in price of petrol and diesel starting in June 2008. Compared with the previous month, the CPI increased by 0.3%. The index for Food & Non-Alcoholic Beverages for November 2009 compared to the same month in 2008 showed an increase of 0.9%, while the index for Non-Food decreased by 0.6%. For the period January to November 2009, the index for Food & Non-Alcoholic Beverages increased by 4.4%, and on the other hand, Non-Food registered a decrease of 1.3%, it said. Compared to the previous month, the index for Food & Non-Alcoholic Beverages and Non-Food increased by 0.4% and 0.2%, respectively. The Department of Statistics said the 0.5% increase in the CPI was brought about by increases observed in the indices of all the main groups except those of Transport (-10.1%); Clothing & Footwear (-0.9%) and Communication (-0.5%). Notable increases among these main groups with high weights were Food & Non-Alcoholic Beverages (+4.4%) and Housing, Water, Electricity, Gas & Other Fuels (+1.3%), it said. Other increases were Alcoholic Beverages & Tobacco (+6.4%); Miscellaneous Goods & Services (+3.6%); Furnishings, Household Equipment & Routine Household Maintenance and Restaurants & Hotels (+3.1%); Education (+2.4%); Health (+2.3%) and Recreation Services & Culture (+1.5%). The department said the two main groups, Food & Non-Alcoholic Beverages and Housing, Water, Electricity, Gas & Other Fuels together accounted for 267.7% of the overall increase recorded for the current period. However, this was offset by the decrease in the index of Transport by 267.3%. The 4.4% increase in the index for Food & Non-Alcoholic Beverages was the result of increases for Food At Home (+4.2%); Food Away From Home (+5.1%) and Coffee, Tea, Cocoa & Non-Alcoholic Beverages (+2.3%). Among the subgroups of Food At Home which showed significant increases during this period were fish & seafood (+6.3%); rice, bread & other cereals (+5.2%); meat (+4%); fruits (+3.9%) and milk, cheese & eggs (+2.9%). Compared with the previous month, the CPI for November 2009 increased by 0.3%, said the department. It said the increases were from main groups Miscellaneous Goods & Services (+0.7%); Food & Non-Alcoholic Beverages and Clothing & Footwear (0.4%); Housing, Water, Electricity, Gas & Other Fuels (+0.3%); Health, Transport, Recreation Services & Culture and Restaurants & Hotels (0.2%); and Alcoholic Beverages & Tobacco and Furnishings, Household Equipment & Routine Household Maintenance (0.1%). The other two main groups, namely Communication and Education, remain unchanged at 96.2 and 108.6 respectively. The 0.4% increase in the index for Food & Non-Alcoholic Beverages in November 2009 compared with that of the previous month was the result of increases in the index for Food At Home (+0.7%); Food Away From Home (+0.1%) as well as Coffee, Tea, Cocoa & Non-Alcoholic Beverages (+0.2%). Among the food items which recorded notable increases in the index in November 2009 compared with the previous month were red chillies (+19.2%); tomatoes (+14.9%); spinach (+11.4%); water spinach (+10.5%); choy sum (+9.6%); garlic (+8.6%); long beans (+7.2%); kailan (+5%); hen's egg (+4.9%) and chicken (+1%). Meanwhile, the index of some food items decreased in November 2009 compared with the previous month. Among these were Selar Scad (Fish) (-4.1%); Threadfin Bream (Fish) (-2.7%); Hardtail Scad (Fish) (-2.7%); Prawn (-2.7%); Black Pomfret (Fish) (-2.6%); Indian Mackerel (Fish) (-1.8%) and Cuttlefish (-1.5%). A reclassification of items according to their durability and services rendered showed increases in Durable Goods (+0.4%); Non-Durable Goods and Services (0.3%) as well as Semi-Durable Goods (+0.2%).

https://theedgemalaysia.com/node/65004

#Update* Two more MPs booted out over Golden Triangle temple demolition

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Last Updated: 7:13pm, Nov 27, 2013 KUALA LUMPUR (Nov 27): Opposition lawmaker R Sivarasa was ordered to leave the Dewan Rakyat today for "wasting" the House's time in seeking answers over the demolition of a temple annexure in the city's Goldren Traingle area. Sivarasa (PKR-Subang) was the second MP to receive the boot from Speaker Tan Sri Pandikar Amin Mulia on the same issue. Within an hour after Sivarasa's sent off, another opposition legislator, V Sivakumar (DAP-Batu Gajah), was booted out of the House by Deputy Speaker Datuk Ismail Mohd Said for incessantly raising a related issue which had already been dealt by Pandikar. On Nov 12, Pandikar ordered N Surendran (PKR-Padang Serai) to leave the House for insisting on an urgent debate on the demolition of the Sri Muneswarar Kaliyaman Temple's annexure after the MP's emergency motion was rejected in chambers. Two days later, Surendran was suspended for six months following a motion submitted by Pandikar himself, claiming that Surendran had accused him of stating false facts in refusing to hear out the urgent motion, in a press conference after getting the boot. Earlier today, during the committee stage debate of BUdget 2014, Sivarasa wanted the Federal Territories Ministry to state the rational for tearing down the connecting structures of the temple. As soon as Sivarasa brought up the issue, Pandikar ticked him off saying that the matter was extensively discussed and deliberated during the policy stage debate two weeks ago. After a 15-minute argument on whether Sivarasa can continue speaking on the issue, Pandikar said: "Go ahead, say something that has not been said before." Sivarasa then asked the speaker: "Can I finish before being interrupted again?" Pandikar snapped at Sivarasa telling him to proceed with what he had to say, but before the lawmaker could finish, the infuriated speaker ordered him to leave the House until the end of the ministry's wrap up. As for Sivakumar, he was told to leave the House after interjecting during the Federal Territories Ministry's wrap up. Sivakumar had demanded that Deputy Federal Territories Minister Datuk J. Loga Balan Mohan give an update on the temple issue, but was told by the deputy speaker not to go gainst Pandikar's ruling on the issue. Meanwhile, Sivarasa told reporters that it was a normal practice for MPs to raise repetitive points during the committee stage debates. The senior lawyer, however, claimed that he was only trying to discuss a solution to the problem rather than repeat matters that have been discussed. "But unfortunately, I never got to get to my point," he said adding that the speaker was seen acting emotionally and was not neutral. "Since I am suspended today and tomorrow, on Monday I will bring the court order in which the judge says that 'nothing in my order allows Hap Seng to destroy any part of the temple'," he said assuming that the suspension is valid for 48 hours. Referring to Federal Territories Minister Datuk Seri Tengku Adnan Mansor's answer in Parliament on the issue, as recorded on the Hansard, Sivarasa said he will present a fact sheet to dispute the "facts" presented by the minister to the speaker. For more stories, go to www.fz.com, the website for freedom of expression and fairness in articulation.

https://theedgemalaysia.com/node/49188

CIMB Research maintains Outperform on AMMB

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KUALA LUMPUR: CIMB Equities Research reiterated its OUTPERFORM recommendation on AMMB as its and consensus forecast of AMMB’s FY3/11 net profit was almost spot on. “The full-year single-tier DPS of 18 sen (12 sen final), however, was above our projected 15.7 sen. Factoring in the rate hike, we cut our FY12-13 EPS by 5.5%. But we raise our DPS projections by 21% in view of the higher-than-expected dividend. “However, our DDM-based target price remains at RM7.90 as the dividend growth for the interim growth phase is reduced from 13.6% to 11.7%,” it said on Thursday, May 19. CIMB Research retained its OUTPERFORM call given the projected earnings growth of 10%-21% for FY12-14, driven by 8-9% loan growth, strong expansion of non-interest income and improving credit charge-off rates. The stock could be catalysed by (1) further value-add from ANZ, (2) benefits from the group revamp, (3) potential increase in investment banking deal flow, and (4) swift expansion of treasury income.

https://theedgemalaysia.com/node/24763

AirAsia launches extra flights for CNY holidays

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KUALA LUMPUR: AirAsia Bhd is launching extra flights to various destinations to meet additional travel demands during the forthcoming Chinese New Year holidays. AirAsia's regional head of commercial, Kathleen Tan said on Thursday, Jan 7 that due to high loads and strong demand during the festive period, AirAsia has added extra flights to cope with the overwhelming response for travel during the up coming Chinese New Year festivities These extra flights are applicable between Feb 9 and 21. They will cater to AirAsia popular destinations which include Kuala Lumpur-Penang, KL-Singapore, KL-Sibu, KL-Kuching, Kuching-Sibu, Singapore-Kuching, KL-Johor Bahru and Johor Bahru-Sibu.