Thursday, 3 May 2012

Stocks to watch Unisem, Daya Materials, Opcom, Heitech Padu, Hock Lok Siew Corp

KUALA LUMPUR (May 2): The FBM KLCI could be hard pressed to sustain its gains on Thursday, as early trade in Europe and Wall Street on May 2 pointed to weaker performance at the equity markets as disappointing euro zone data sparked new concerns over the region's fiscal health ahead of domestic economic data.

Markit's Eurozone Manufacturing Purchasing Managers' Index dropped to 45.9 last month from 47.7 in March, marking its lowest reading since June 2009. European shares erased earlier gains and the euro dropped to its lowest level in two weeks against the Japanese yen., according to Reuters.

A slew of announcemnts on Bursa Malaysia, including that of the termination of the share swap deal between MALAYSIAN AIRLINE SYSTEM BHD [] (MAS) and AIRASIA BHD [] could spur investor activity, but whether the FBM KLCI can advance will be left to be seen.

Among the stocks that could be in focus are UNISEM (M) BHD [], DAYA MATERIALS BHD [], OPCOM HOLDINGS BHD [], HEITECH PADU BHD [] and Hock Lok Siew Corporation Bhd.

Unisem posted net loss RM13.52 million for the first quarter ended March 31, 2012 compared with net profit RM5.09 million a year earlier.

It said that revenue for the quarter fell to RM256.61 million from RM291.97 million in 2011.

Daya Materials Bhd’s unit Daya CMT Sdn Bhd has secured a CONSTRUCTION [] contract worth RM270 million from Yuk Tung Corporation Sdn Bhd.

Daya said that Daya CMT had been awarded the contract as the principal sub-contractor for the development comprising 3-Blocks of 28-Storey mixed development consisting soho units, office lots, podium car park and basement car park at Jalan Sungai Besi in Kuala Lumpur.

Opcom Holdings Bhd, a fibre-optic cable manufacturer, has secured an RM82 million variation order to an existing RM359 million contract with TELEKOM MALAYSIA BHD [].

Opcom said it had secured the RM359 million fiber-to-the-home contract from Telekom in April 2009. Opcom had in May 2011 secured a two-year extension for the project till April 19, 2013.

Heitech Padu Bhd secured a RM15.2 million job from the national registration department.

Hock Lok Siew Corp said on Wednesday that it had been designated a Practice Note 17 company after triggering the prescribed criterias of the Listing Rules.

Meanwhile, the RM1.1 billion share-swap deal involving beleaguered Malaysian Airline System Bhd (MAS) and AirAsia Bhd has been called off, according to filings to Bursa Malaysia Securities Bhd on Wednesday.

Shares in both MAS and AirAsia were suspended from trading on Wednesday ahead of the announcement, but the airlines have not announced when their respective securities would resume trading.

However, if MAS and AirAsia resume trade on Thursday, investor interest would certainly be high given the nature and magnitude of the original deal that is being called off.

In separate announcements, the two airlines on May 2 said they had entered into a Supplemental Agreement to vary the terms and scope of the original collaboration agreement inked last August.

The share-swap last August saw AirAsia’s Tan Sri Tony Fernandes and his partner Datuk Kamarudin Meranun taking up a 20.5% interest in MAS and two board positions, in exchange for Khazanah owning a 10% stake in the regional budget airline.

The airlines said on Wednesday that pursuant to the Supplemental Agreement, they had separately entered into memorandums of understanding (MoU) in respect of firstly, to jointly explore the setting up of the joint-venture company by MAS, AirAsia and AAX to provide aircraft component maintenance support and repair services.

Secondly, the MoU was to establish the broad set of business principles for the establishment of a special purpose vehicle (SPV) by MAS, AirAsia and AAX to improve value for money and increase competitiveness and benefits to customers through procurement synergies by outsourcing to the SPV the procurement processes for identified goods and services in agreed categories

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