AmG-Kurnia merger gets the nod

KUALA LUMPUR (April 4): The government has approved AMMB HOLDINGS BHD []'s plan to acquire the general insurance arm of KURNIA ASIA BHD [] (KAB).

In separate statements to the exchange on Wednesday, both companies said the minister of finance has approved the planned acquisition of KAB's 100%-owned subsidiary Kurnia Insurans (M) Bhd by AmG Insurance Bhd, which is 51% owned by AMMB.

Both AMMB and KAB said details on the transaction will be disclosed when both AmG and KAB sign a definitive agreement.



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KLCI snaps winning streak, drops below 1,600-level

KUALA LUMPUR (April 4): The FBM KLCI snapped its winning streak on Wednesday and fell below the 1,600-point level, in line with the retreat at most global markets after on generally weaker sentiment at key regional markets following the overnight dip at Wall Street.

The FBM KLCI fell 7.36 points to close at 1,599.27, weighed by losses and banking and select blue chips.

"Stocks and the euro fell on Wednesday after the US Federal Reserve dimmed hopes for fresh asset-buying, further underlining its divergence with an embattled Europe that remains in crisis-fighting mode," according to Reuters.

Overnight minutes from the Fed's March meet showed less support for more quantitative easing (QE), or bond-buying, in the face of improved economic data, which buoyed the dollar and hit stocks in both the United States and Asia, it said.

With Europe still battling its debt crisis and struggling with economic growth, the focus later will be on the European Central Bank's latest rate-setting meeting, with rates expected to remain on hold at 1%, said Reuters.

At the regional markets, Japan’s Nikkei 225 fell 2.29% to 9,819.99, South Korea’s Kospi fell 1.60% to 2,018.61, and Taiwan’s Taiex lost 1.3% to 7,760.85, while Singapore’s Straits Times Index

The Hong Kong and Shanghai markets were closed for a public holiday.

On Bursa Malaysia, among the banking stocks, CIMB and RHB Capital lost nine sen each to RM7.72 and RM7.74, Hong Leong Bank and HLFG lost eight sen each to RM12.38 and RM12.48, AMMB down six sen to RM6.32, while Public Bank shed two sen to RM13.78.

Among the other decliners, BAT fell 64 sen to RM55.58, Dutch lady down 44 sen to RM35.50, Carlsberg fell 20 sen to RM10.60, F&N 18 sen to RM19, Sarawak Oil Palms 13 sen to RM6.81, while BLD PLANTATION []s, Cepco, Shell, Tenaga and PPB fell 10 sen each to RM9.15, RM1.55, RM10.18, RM6.47 and RM16.60 respectively.

GAB was the top gainer and rose 16 sen to RM13.20, Milux gained 15 sen to RM1.40, GBH 13 sen to RM1.25, Kamdar 12.5 sen to 49.5 sen, Malpac and JCY 10 sen each to RM1.59 and RM1.29, Tradewinds Plantations nine sen to RM4.94, Kurasia 6.5 sen to 63.5 sen and Tradewinds up six sen to RM9.60.

The actives included Ingenuity Solutions, Metronic, Cerotech, ManagePay, Naim Indah Corp, Ariantec, JCY and SuperComNet.



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Trading of Xian Leng shares suspended

KUALA LUMPUR (April 4) : Trading of XIAN LENG HOLDINGS BHD [] shares has been suspended since 12.16pm on Wednesday.

In a statement to the exchange, Xian Leng which undertakes commercial breeding of ornamental fish, said it requested for the trading suspension pending the release of the findings of a special audit on the company’s financials by PricewaterhouseCoopers.

Xian Leng managing director Ng Huan Tong has voluntarily resigned from his position as PricewaterhouseCoopers finalises its investigation.

Xian Leng shares were last traded at 54 sen prior to the suspension.



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Pharmaniaga aims to increase revenue contribution from private sector, says MD

KUALA LUMPUR (April 4): PHARMANIAGA BHD [] (Pharmaniaga) is looking to increase the revenue contribution from the private sector from the 3% at present, said its managing director, Datuk Farshila Emran.

Farshila said after its AGM on Wednesday that the group was hoping to achieve a target of about 6% to 7% revenue contribution from the private sector for its FY2012, ending Dec 31.

The private sector includes private hospitals and private clinics.

“There are also other private markets which comprise of private hospitals as well as institutional hospitals as well which we are including in the private sector.

There are many in the pipeline and we’re hoping to have growth from the private sector,” she said.

Pharmaniaga recorded a net profit of RM52.8 million, a 74% year-on-year (y-o-y) growth from last year’s net profit of RM30.31 million. This was on the back of a revenue of RM1.52 million recorded for FY2011, 10.14% higher than FY2010’s revenue of RM1.38 million.


Meanwhile, Pharmaniaga chairman Tan Sri Lodin Wok Kamaruddin said the company remains upbeat on its prospects for 2012 on the back of its achievement of a 62% year-on-year increase in profit before tax to RM73 million for the financial year ended Dec 31, 2011 from RM45 million in 2010.

He said the company’s confidence to strengthen its earning potential for 2012 was backed by its substantial growth in revenue of RM1.5 billion in 2011, which was its highest in 5 years.

In a statement issued Wednesday in conjunction with Pharmaniaga’s AGM, Lodin said the first nine months under the Boustead Group had resulted in tangible benefits to their bottom line and they were happy to reward shareholders with a significant 61% payout ratio for the year under review.

“Our shareholders are able to enjoy a 4.7% yield based on the closing price for the financial year,” he said.

He also said that shareholders were also given bonus issue on the basis of one Pharmaniaga bonus share for every 10 shares held.

According to Lodin, several significant operational restructuring programmes at all levels were initiated to improve efficiencies and productivity that resulted in their achievement.

Lodin said he was optimistic about the group’s growth and prospects for the coming year as they were committed in expanding their business locally and internationally by enhancing their capabilities towards strengthening shareholders value.

“We trust the renewal in the Concession Agreement (CA) with the Ministry of Health (MOH) for the supply of pharmaceutical products for a 10-year period will be the catalyst for this growth and allow us to move up the pharmaceutical value chain,” he said.



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KLCI snaps four-day winning streak, dips at mid-day break

KUALA LUMPUR (APRIL 4): The FBM KLCI snapped its four –day winning streak and retreated at the mid-day break on Wednesday, in line with the generally weaker sentiment at key regional markets following the overnight dip at Wall Street.

Asian shares fell on Wednesday after the minutes from the U.S. Federal Reserve's March meeting suggested the bank was less inclined to take further stimulus measures, leaving investors looking for more clues to the global growth outlook, according to Reuters

Fed policymakers remained focused on a still elevated jobless rate while noting signs of slightly stronger growth, but the minutes suggested the appetite for further quantitative easing, so-called QE3 has waned significantly in light of an improving U.S. economy, it said.

At the mid-day break, the FBM KLCI was down 5.78 points to 1,600.85, weighed by losses at select blue chips.

Market breadth turned negative with losers leading gainers by 369 to 199, while 315 counters traded unchanged. Volume was 571.84 million shares valued at RM399.87 million.

The ringgit weakend 0.45% to 3.0613 versus the US dollar; crude palm oil futures for the third month delivery rose RM31 per tonne to RM3,530, crude oil shed 32 cents per barrel to US$103.69 whiel gold fell US$1.82 an ounce to US$1,644.30.

At the regional markets, Japan's Nikkei share average abruptly broke below 10,000 to hit a four-week low on Wednesday, after stop-losses were triggered on index futures, raising concerns that Tokyo's strong equities rally so far this year was coming to a halt.

The Nikkei 225 fell 1.59% to 9,890.65, Hong Kong’s Hang Seng index lost 1.31% to 20,790.90, Taiwan’s Taiex and South Korea’s Kospi fell 1.3% each respectively to 7,760.85 and 2,022.54 respectively, Singapore’s Straits Times Index shed 0.38% to 3,003.16 while the Shangai Composite Index edged up 0.47% to 2,262.79 .

BIMB Securities Research in a note Wednesday said that traders I the US resorted to profit on Tuesday taking amid signs that additional stimulus were diminishing from the Feds latest signal.

As such, the Dow Jones Industrial Average dipped 65 points to just below the 13,200 level.

We find this odd as we interpret this as positive and that the US economy is on auto pilot without the requirement of more financial steroids.

Regionally, Asian markets were slightly higher across the board except for Taiwan being hit hard from rumours that capital gains tax may be imposed on stock trades.

Meanwhile, the FBM KLCI continued with its uptrend with another record high via another 2.9 point gain to close at almost 1,607.

Nonetheless, we noticed that investors are becoming wary of the local bourse’s recent uptrend and believe a correction would emerge anytime soon.

“Foreign funds had again flowed into the market with another net positive of RM203 million yesterday.”

“Despite the foreign buying, we reckon the index may see some retracement today albeit marginally,” it said.

On Bursa Malaysia, Shell was the top loser in the morning session and fell 14 sen to RM10.14, PPB lost 12 sen to RM16.58, Litrak, Carlsberg and AFG fell 10 sen each to RM3.94, RM10.70 and RM3.86 respectively, Sop and Amway lost nine sen each to RM6.85 and RM9.80, Inno down eight sen to RM1.42, while MMHE and RHB Capital fell seven sen each to RM3.39 and RM7.70.

Among the gainers, Milux added 15 sen to RM1.40, Tradewinds and malPac up 10 sen each to RM9.64 and RM1.59, Tradewinds PLANTATION []s seven sen to RN4.92, Ewein and MBM Resources up six sen each to 84 sen and RM4.8, whiel Quality Concrete, Fiamma and NSOP added five sen each to RM1.29, RM1.15 and RM6.15 respectively.



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ManagePay most active, up 27%

KUALA LUMPUR (April 4) : ManagePay Systems Bhd, the most-actively traded stock on Wednesday noon , rose as much as 27% following updates on its strategic collaboration with Visa Worldwide Pte Ltd.

ManagePay rose 5.5 sen to an intraday high of 26 sen before trading lower at 22 sen at 12.02pm with some 41 million shares done.

According to ManagePay, the strategic collaboration aims to expand the adoption of electronic payment among small and medium enterprises by simplifying the merchant acquisition process and lowering the acquisition cost.



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Malaysia Smelting shares down on Indonesian export tax updates

KUALA LUMPUR (April 4) : Malaysia Smelting Corp Bhd (MSC) shares fell as much 0.7% in morning trade following updates that Indonesian policymakers may implement a 25% export tax on coal and base metals this year.

According to news reports quoting a government official, the export tax may be further raised to 50% next year.

MSC shares fell three sen to an intraday low of RM4.07 at 10.45am.



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KLCI down 3 pts on Wed mid-morning

KUALA LUMPUR (April 4) : Malaysian stocks gave up earlier gains to slip into the red at mid-morning on Wednesday against a weaker backdrop across Asian equity indices.

This follows a weaker overnight close across US markets after policymakers indicated that they may not implement further quantitative easing to spur the world’s largest economy. Analysts said a weaker overnight close at US markets could dictate sentiment across Malaysian stocks on Wednesday.

“Still, we reckon the benchmark index (FBM KLCI) is expected to show resilience as investors may be tempted to buy on dips following the new record levels set by our local bourse this week,” HwangDBS Vickers Research Sdn Bhd wrote in a note.

At 10am, the 30-stock FBM KLCI fell 3.26 points to 1,603.37. Some 259 million shares worth RM111 million changed hands, leading to 142 gainers against 176 decliners while 256 entities were unchanged.

Top gainer BRITISH AMERICAN TOBACCO (M) [] Bhd rose 32 sen to RM56.54 followed by United PLANTATION []s Bhd which added 10 sen to RM25.

Decliners PPB GROUP BHD [] fell 12 sen to RM16.58 while TRIPLC BHD [] was down 7.5 sen to 43 sen.

Among actively traded stocks, Ariantec Global Bhd and METRONIC GLOBAL BHD [] were unchanged at 10.5 sen and 16 sen respectively with some 20 million shares done.

Across Asia, Japan’s Nikkei 225 fell 0.44% to10,005.8 points, Australia’s S&P / ASX 200 declined 0.43% to 4,318.6 while Taiwan’s Taiex was down 1.3% to 7,760.85

Stock markets in Hong Kong and China are closed on Wednesday. Note that markets in Europe and the US will be closed on Friday for the Easter holiday.



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Maybank IB downgrades Sarawak Oil Palms to Hold

KUALALUMPUR (April 4): Maybank Investment Bank Bhd Research has downgraded Sarawak Oil Palms (SOP) to a Hold from Buy previously with an unchanged target price of RM7.20 and said SOP’s JV to secure two tankers does not come as a surprise as logistical support is increasingly crucial as SOP grows in size and sells its palm oil regionally.

“This small initial capital outlay of RM7.7 million has broader implications for its longer-term plan to be a sizeable, integrated PLANTATION [] player.

“That said, its share price has risen 60% since we initiated coverage on 2 Aug 2011. We downgrade the stock to Hold given a narrowed 4% upside to our RM7.20 TP (on 13x 2013 PER),” the research house said in a note Wednesday.



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KLCI opens at fresh new high

KUALA LUMPUR (April4): The FBM opened at a fresh new all-time high on Wednesday, with its momentum still intact despite the retreat at most key regional markets following the weaker overnight close at Wall Street after the after the U.S. Federal Reserve said it was less inclined to provide more economic stimulus.

The FBMKLCI was up 0.91 of a point to 1,607.54 at 9am, lifted by gains at blue chips including Genting, Maybank and IOI Corp.

Gainersled losers by 17 to 11, while 38 counters traded unchanged. Volume was 4.09 million shares valued at RM2.74 million.

Meanwhile, Asian shares eased on Wednesday after the minutes from the U.S. Federal Reserve's March meeting suggested the bank was less likely to take further stimulus measures, leaving investors looking for more clues over global growth outlook, according to Reuters.

The minutes showed Fed policymakers, while noting signs of slightly stronger growth, remained focused on a still elevated jobless rate. But the minutes suggested the appetite for further quantitative easing, so-called QE3, has waned significantly in light of improving U.S. economy, it said.

Among the early gainers were BAT that rose 32 sen to RM56.54, Genting up four sen to RM11.08, Boustead two sen to RM5.48, while IOI Corp, Maybank, Telekom, Leader, MBSB, Muhibbah and Mudajaya added one sen each to RM5.37, RM8.96, RM5.39, RM1.07, RM2.29, RM1.35 and RM2.91, respectively.

Iris Corp was the most actively traded counter with 1.4 million shares done. The stock shed half a sen to 18 sen.

Other actives included Ariantec, TMS, IFCA MSC, Hubline, Voir and Telekom.



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MIDF Research maintains Sell call on MAS, target price RM1.35

KUALA LUMPUR (April4): MIDF Research has maintained its Sell rating on Malaysian Arline System Bhd (MAS) with a target price of RM1.35 after the airline unexpectedly discarded its plan to launch a new premium regional airline.

MAS had said that it was slight business module realignment for the regional airline initiative. Strategy and objective of short-haul operation will remain unchanged while the premium regional service will instead offer in-house under MAS brand.

MIDF Research in note Wednesday aid that the decision to scrap the new airline came in as a surprise and would possibly put a question mark on MAS’ ability to execute its turnaround plan.

“There are still many structural weaknesses faced by MAS such as its sliding position in the premium category and over-staffing, which MAS need to tackle.

“Hence, we reiterate our current view with SELL recommendation and our target price to RM1.35 by pegging its Price-to-Book value in FY12 to 1.8 times,” it said.



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Stocks to Watch Petra, MAS, MISC

KUALA LUMPUR (Apr 3): There is still room for the FBM KLCI to trade higher, according to analysts, as technical trading dynamics improve in anticipation of more positive updates by the government ahead of Malaysia’s general election.

Analysts said the 30-stock index has breached the 1,600 point level; hence, the possibility that the FBM KLCI will reach the next hurdle of 1,620 points.

The benchmark added 2.85 points to close at a fresh all-time high of 1,606.63 points on Tuesday.

Stocks to watch on Wednesday include PETRA ENERGY BHD [], Y.S.P.SOUTHEAST ASIA HOLDING [] Bhd, SARAWAK OIL PALMS BHD [] (SOPB), MALAYSIAN AIRLINE SYSTEM BHD [] (MAS) and MISC BHD [].

Petra Energy has signed a memorandum of understanding with Baker Hughes (M) Sdn Bhd to undertake oil and gas projects in Malaysia.

Y.S.P. plans to reward shareholders with a single-tier first and final dividend of six sen per ordinary share for financial year ended Dec 31, 2011.

SOPB is diversifying into the shipping business following a joint venture (JV) agreement with Shin Yang Shipping Corp Bhd.

MAS has called off its plans to set up a short-haul regional premium airline, and will instead provide such services via an operating unit under the company.

Malaysian Rating Corp Bhd (MARC) has revised the outlook of MISC’s Islamic bonds to negative from stable. The revision has taken into account the shipping firm’s weaker financials, according to MARC.



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