United Plantations proposes final and special dividend

KUALA LUMPUR (April 17) : United PLANTATION []s Bhd plans to reward shareholders with a special and final dividend with a combined value of 60 sen a share for financial year ended December 31, 2011.

In a statement to the exchange on Tuesday, United Plantations said the special portion comprises a 50% gross payment of the stock’s par value of RM1 less 25% tax. This translates into 37.5 sen a share.

The final dividend of 30% less tax, translates into 22.5 sen. The ex and entitlement dates fall on May 14 and 16 respectively.



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Grand-Flo proposes final dividend of 1.2 sen a share

KUALA LUMPUR (April 17) : GRAND-FLO SOLUTION BHD [], an enterprise data collection and collation system solutions provider, plans to reward shareholders with a final dividend of 1.2 sen a share for the financial year ended December 31, 2011.

The dividend, which requires Grand-Flo’s shareholders’consent, comprises a gross taxable portion of 0.037 sen and the tax-exempt balance of 1.163 sen. The entitlement and payment dates will be decided later, the company told the bourse on Tuesday.

“The dividend proposed is in line with the dividend policy adopted by the company which aims to distribute to its shareholders a minimum of 20% of the group’s net profits for each financial year.

“Whilst the board believes in rewarding the company’s shareholders with steady returns on their investments and attracting potential long-term investors, the board is mindful that adequate working capital and reserves shall be set aside for capital investments and future potential growth, taking into consideration the global economic conditions,” Grand-Flo said.



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APM Automotive sets up Indonesian subsidiary to sell automotive parts

KUALA LUMPUR (April 17): APM AUTOMOTIVE HOLDINGS BHD [] is setting up a subsidiary in Indonesia to manufacture and sell automotive parts for the republic’s market.

In a filing Tuesday, APM Automotive said the Indonesian authorities had approved the deed of establishment of PT. APM Auto Components Indonesia (PT. APMACI).

The company said PT APMACI would carry on a project to manufacture and sell automotive heat exchange products, namely, air-conditioning cooling system, evaporators, condensers, cooling modules and radiators for the Indonesian market.

The manufacturing facility will be located on an industrial lot of land area measuring approximately 38,077 sq meters at Suryacipta Industrial City in Karawang, West Java, it said.

APM Automotive said completion of the facility was expected end 2012 with operations to commence in the second quarter of 2013.

“Under the Investment Registration of PT. APMACI, the company is also permitted to carry out the business of property rental.

“The total capital and investment outlay for the project will be approximately US$10.9 million, financed by internal funds,” it said.

APM Automotive said PT APMACI’s total issued and paid-up share capital would be US$10 million and would be subscribed for by two of its 100% owned investment holding companies , namely APM Automotive International Ltd, which would hold 6.4 million shares (80%) and Auto Parts Holdings Sdn Bhd, wwith 1.6 million shares (20%).



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KLCI succumbs to global economic woes

KUALA LUMPUR (APRIL 17): The FBM KLCI succumbed to the mounting concerns over the euro zone sovereign debt crisis that kept most regional markets in negative territory on Tuesday.

The FBM KLCI closed 1.32 points lower at 1,596.19.

Gainers edged losers by 355 to 341, while 351 counters traded unchanged. Volume was 2.08 billion shares valued at RM1.63 billion.

Hong Kong shares fell on Tuesday, dragged lower by large-cap bank and materials shares as nervous investors awaited a bond auction which could see a further jump in Spain's borrowing costs, threatening a new crisis in the euro zone, according to Reuters.

On the mainland, the Shanghai Composite fell 0.94% to 2,334.98, while the CSI300 index was off 1.3 percent, it said.

Elsewhere, Hong Kong’s Hang Seng Index fell 0.23% tyo 20,562.31, Japan’s Nikkei 225 shed 0.06% to 9,464.71, Taiwan’s taiex lost 1.86% to 7,585.87, South Korea’s Kospi down 0.37% to 1,985.30 and Singapore’s Straits Times Index shed 0.18% to 2,986.59.

Among the decliners on Bursa Malaysia, Dutch Lady fell 56 sen to RM34.60, Warisan down 30 sen to RM2.33, Tahps fell 27 sen to RM4.53, BAT lost 22 sen to RM54.46, SMPC 21 sen to RM1.12, MISC 13 sen to RM5.17, while KLuang and Ta Ann fell 12 sen each to RM2.68 and RM6.57.

Ariantec Global was the most actively traded counter with 515.66 million shares done. The stock jumped 8.5 sen to 20 sen. It had earlier been issued an unusual market activity (UMA) query by Bursa Malaysia Securities Bhd to Ariantec Global Bhd over the sharp rise in the price and high volume in the company’s shares recently.

Other actives included Metronic, Focus, Astral Supreme, Ingenuity Solutions, SuperComNet, CSL, Naim Indah Corp and Winsun.

Meanwhile, the gainers on Tuesday included SAM Engineering, Carlsberg, CSL, Subur Tiasa, Y&G, Golsta, Southern Acids, Rapid, Manulife and The Store.



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SMPC rights shares hit limit-down

KUALA LUMPUR (April 17) : Securities of SMPC Corp Bhd were among the most actively-traded and major decliners on the maiden trading day of the steel manufacturer’s rights units on Tuesday. The stock went ex-rights last Thursday.

SMPC’s rights issue of new shares (SMPC-OR) fell as much as 61% or 30 sen to settle at 19.5 sen at lunch break while the irredeemable convertible unsecured loan stocks (ICULS) which are traded as SMPC-LR fell as much as 90% or 4.4 sen to settle at 0.5 sen.

Meanwhile, SMPC shares declined as much as 26% to 98 sen before settling higher at RM1.08.

SMPC is undertaking a renounceable rights issue of up to 19.39 million new shares with 9.7 million free warrants on the basis of six rights units and three warrants for every two existing shares held.

The company is also implementing a renounceable rights issue of up to RM19.39 million worth of zero-coupon, 10-year ICULS with 9.7 million free warrants on the basis of RM6 worth of ICULS and three warrants for every two existing shares held.

In conjunction with the rights issue, SMPC implemented a capital reduction where it cancelled 90 sen from each existing share of RM1 and, subsequently, consolidated 10 units of 10 sen shares into one share of RM1.



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Bursa queries Ariantec

KUALA LUMPUR (April 17): Bursa Malaysia Securities Bhd has issued an unusual market activity (UMA) query to Ariantec Global Bhd over the sharp rise in the price and high volume in the company’s shares recently. Ariantec was the most actively traded stocks in the morning session on Tuesday on Bursa Malaysia with 315.47 million shares done. The stock rose 5.5 sen to 17 sen.



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CIMB to update “soon” on Philippines Bank of Commerce stake buy, says Nazir

KUALA LUMPUR (APRIL 17): CIMB Group Holdings Bhd chief executive Dato' Sri Nazir Razak said the company would announce an update on the potential acquisition of a stake in Philippines' Bank of Commerce (BoC) "soon". Speaking after the banking group’s AGM this here, he said negotiations were ongoing and that foreign ownership in Philippine banks was capped at 60%.



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KLCI struggles to breach 1,600-mark

KUALA LUMPUR (APRIL 17): The FBM KLCI stayed in positive territory in the morning session on Tuesday, but struggled to breach the 1,600-point mark as regional markets mostly retreated on mounting concerns over the euro zone sovereign debt crisis.

Asian shares were capped while the euro fell on Tuesday, as soaring Spanish borrowing costs underscored the fading impact of the European Central Bank's bond purchases and stoked investor nervousness over euro zone debt woes, according to Reuters.

The FBM KLCI was up 0.69 of a point to 1,598.20 at the mid-day break.

Gainers trailed losers by 283 to 278, while 322 counters traded unchanged. Volume was 1.2 billion shares valued at RM669.23 million.

The ringgit strengthened 0.03% to 3.0665 versus the greenback, crude palm oil futures for the third month delivery fell RM2 per tonne to RM3,485, crude oil was unchanged at US$102.93 per barrel while gold fell US$2.63 an ounce to US$1,649.25.

At the regional markets, Japan’s Nikkei 225 edged up 0.11% top 9,480.84 while Taiwan’s Taiex fell 1.61% to 7,605.13, Hong Kong’s hang Seng Index lost 0.58% to 20,490.90, Singapore’s Straits Times Index was down 0.39% to 2,980.57, South Korea’s Kospi shed 0.30% to 1,986.75 and the Shanghai Composite Index inched down 0.18% to 2,352.72.

Mybank Investment Bank Bhd head of retail research and chief chartist Lee Cheng Hooi in a note to clients on Tuesday said the FBM KLCI dropped 5.61 points to close at 1,597.51 on Monday.

“Its resistance areas of 1,597 and 1,609 may cap market gains, whilst the obvious support areas are located at 1,580 and 1,594,’ he said.

He said despite the US markets’ mixed tone last night, Bursa Malaysia could be in for a low-volume trading day.

“From the 1,310.53 low (Sept 2011), the market has surged past its previous resistance of 1,597.08 to stall at 1,600.33 (On April 3).

“Bearish divergence is ample and investors may liquidate on rallies,” he said.

SAM Engineering was the top gainer in the morning session and rose 41 sen to RM3.60, Hartalega added 16 sen to RM8.12, CSL 14 sen to RM1.62, Far East and Subur Tiasa gained 10 sen each to RM7.60 and RM2.73, Rapid nine sen to RM2.54, Carlsberg eight sen to RM10.90, MBSB and Lafarge Malayan Cement gained seven sen each to RM2.23 and RM7.29, while Golsta was up 6.5 sen to 59.5 sen.

Among the decliners, Dutch Lady fell 46 sen to RM23.70, SMPC fell 25 sen to RM1.08, Nestle down 16 sen to RM55.84, Sarawak Oil Palms lost 13 sen to RM6.81, Iretex 12 sen to RM1, Knusford and Bintulu Port fell 10 sen each to RM1.80 and RM6.90, while MalPac and Ta Ann lost nine sen each to RM1.49 and RM6.60.

Ariantec was the most actively traded counter with 315.47 million shares done. The stock rose 5.5 sen to 17 sen.

Other actives included Metronic, Focus, Ingenuity Solutions, SuperComNet, Naim Indah Corp and JCY.



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MBSB up 4% in anticipation of higher dividends

KUALA LUMPUR (April 17) : MALAYSIA BUILDING SOCIETY BHD [] (MBSB) shares rose as much as 4% on Tuesday morning, possibly, in anticipation of higher dividends by virtue of the financial services provider’s land disposal proceeds.

The stock added nine sen to RM2.25 before being transacted lower at RM2.23 at 12.03pm. Some 3.5 million shares changed hands.

In a note, RHB Research Institute Sdn Bhd said MBSB could register a one-off gain of some RM100 million from the sale of its tracts in Sungai Buloh and Johor.

The one-off gain may result in an additional net dividend yield of 1% assuming a 30% payout ratio, according to RHB.



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Hartalega continues ascend on expansion plans

KUALA LUMPUR (APRIL 17): HARTALEGA HOLDINGS BHD [] shares continued to advance on Tuesday after the company said it was setting up a RM1.5 billion “next generation integrated glove manufacturing complex” (NGC) comprising 70 new high tech production lines.

At 12.01pm, Hartealega gained 23 sen to RM8.19 with 242,900 shares done.

The company last Friday said that its wholly owned subsidiary Hartalega NGC Sdn Bhd that was incorporated on March 29 is the designated corporate vehicle for the setting up of the NGC project, that is mainly involved in the production of rubber gloves to cater to fast rising global demand.



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Latexx up 6%, among top gainers

KUALA LUMPUR (April 17) : LATEXX PARTNERS BHD [] shares rose as much as 6%, placing shares of the rubber glove manufacturer among top gainers on Tuesday morning.

The stock added nine sen to RM1.58 before trading lower at RM1.55 at 11.24am.

Latexx said last February that it plans to reward shareholders with a tax-exempt final dividend of 3% a share for financial year ended December 31, 2011.

The company has not announced the entitlement and payment dates for the dividend.



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World economic concerns weigh on KLCI

KUALA LUMPUR (April 17) : The Malaysian equities barometer rose on Tuesday morning against a backdrop of mixed global economic updates. These include news on European sovereign debt woes which offset the effects of improved retail sales in the US.

Analysts said the FBM KLCI could take the cue from the mixed overnight performance of US equity benchmarks against concerns on the impact of Europe’s debt crisis on world financial markets.

“In the absence of fresh market leads, our Malaysian bourse will probably continue to be range-bound for the time being,” HwangDBS Vickers Research Sdn Bhd wrote in a note.

At 10am, the FBM KLCI added 2.19 points to 1,599.7. Across the exchange, some 476 million shares worth RM183 million were traded, leading to 93 gainers versus 139 decliners.

Among top gainers, PETRONAS GAS BHD [] added 10 sen to RM16.88 while GUAN CHONG BHD [] was up eight sen to RM2.95.

Decliners include NESTLE (M) BHD [] which fell 18 sen to RM55.82 while SARAWAK OIL PALMS BHD [] was down 14 sen to RM6.80.

Among Asian bourses, Japan’s Nikkei 225 climbed 0.38% to 9,506.47 points while Australia’s S&P/ ASX 200 rose 0.32% to 4,315.9. South Korea’s Kospi was up 0.2% to 1,996.6.



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Bumi Armada up on Lukoil deal

KUALA LUMPUR (April 17): Bumi Armada Bhd shares rose on Tuesday after the company said it would offer oil and gas support services to Russia-based OAO Lukoil in deal worth an estimated U$200 million (RM614 million).

At 9.25am, Bumi Armada was up seven sen to RM452 with 311,300 shares traded.

CIMB Research has maintained it Outperform rating on Bumi Armada Bhd at RM4.45 with a target price of RM4.80 and said things were going swimmingly for Bumi in Russia where it has clinched a US$200m pipe installation contract from Lukoil.

In a note April 17, the research house said the contract would maximise the utilisation of its Armada Installer derrick pipelay barge, which is servicing a Petronas contract, also in the Caspian Sea.

“We continue to value the stock at 18.2x CY13 P/E, 40% premium over our target market P/E.

“Bumi’s RM7.6 billion order book and four anticipated FPSO contract wins support our forecast of record net profits in FY12-14 and 31.7% 3-year EPS CAGR. Maintain Outperform.



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Alliance Research upgrades Affin to Strong Buy, raises TP to RM3.84

KUALA LUMPUR (April 17): Alliance Research has upgraded AFFIN HOLDINGS BHD [] (AHB) to a Strong Buy from Trading Buy previously, and raised its target price to RM3.84 from RM3.50 earlier.

In a note Tuesday, Alliance Research maintained that the group’s transformation story was persistently overlooked by the investment community.

The research house said that given the remarkable turnaround of AHB’s operations, current valuation was compelling, trading at a forward PER of 8.2x and about 28.0% discount against its 2012 book value.

“We believe that the potential for Bank of East Asia (BEA) to increase its stake in AHB is imminent, in view of further liberalisation in the domestic banking sector by BNM in Dec last year with the unveiling of Financial Sector Blue Print.

“Therefore, we maintain that the near term key re-rating catalyst for the group remains BEA potentially increasing its stake in AHB,” it said.



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MIDF Research maintains Negative on shipping sector

KUALALUMPUR (April 17): MIDF Research has maintained Negative on the shipping sector and said the Baltic Dry Index (BDI) had slumped to a 3-year low of 647 points on Feb 3, 2012.

In a note April 17, the research houses said that nonetheless, the benchmark for dry commodities freight rate had since gradually ascended to 976 points, and is trending upward towards 1,000 points.

“Despite its recent recovery, the BDI is still about -37% below its last year average of 1,549 points. The average capesize TCE/day rate improved +23.8% mom to USD 7,080, hitting the breakeven range of USD7,000 – 8,000.

“However, we opine that further major rebound in freight rate is unlikely to occur in the near term hence we maintain our negative view on the shipping sector,” said MIDF Research.



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The FBMKLCI holds steady at open, blue chips lift

KUALA LUMPUR (April 17): The FBM KLCI held steady at the opening on Tuesday and edged up 0.62 of a point to 1,598.13 at 9am.

Meanwhile, global stocks faltered on Monday despite stronger-than-expected U.S. retail sales, while government debt prices rose as worries about Spain's fiscal problems and a resurgent euro zone crisis weighed on investor sentiment, according to Reuters.

Market breadth at Bursa Malaysia was generally positive in early trade with 69 gainers, 27 decliners and 76 counters trading unchanged.

Among the early gainers were Tradewinds PLANTATION []s, Petronas Gas, KLK, Genting, Hong Leong Bank, Parkon, MBSB and IOI Corp.



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CIMB Research maintains Outperform on Bumi Armada

KUALALUMPUR (April 17): CIMB Research has maintained it Outperform rating on Bumi Armada Bhd at RM4.45 with a target price of RM4.80 and said things were going swimmingly for Bumi in Russia where it has clinched a US$200m pipe installation contract from Lukoil.

In a note April 17, the research house said the contract would maximise the utilisation of its Armada Installer derrick pipelay barge, which is servicing a Petronas contract, also in the Caspian Sea.

“We continue to value the stock at 18.2x CY13 P/E, 40% premium over our target market P/E.

“Bumi’s RM7.6 billion order book and four anticipated FPSO contract wins support our forecast of record net profits in FY12-14 and 31.7% 3-year EPS CAGR. Maintain Outperform.



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RHB Research maintains Outperform on Carlsberg, ups fair value to RM11.60

KUALA LUMPUR (April 17): RHB Research Institute Sdn Bhd has maintained its Outperform rating on CARLSBERG BREWERY MALAYSIA BHD [] at RM10.82 with a higher far value of RM11.60, and said that the first batch of Asahi draft, which Carlsberg started brewing in Dec 2011, sold out much faster than the company’s initial expectations.

"Asahi’s strong take-up in the market is positive for Carlsberg, although we note that it is still too early to gauge its long-term success."

“Similar to Asahi, Carlsberg will start producing Kronenburg’s draft first followed by bottles later. However, unlike Asahi, we understand the locally-produced Kronenburg will still be priced at a fairly high price point, we believe due to Kronenburg’s premium branding,” the research house said in a note Tuesday.

Carlsberg intends to raise its selling prices by ~3-4% on average, which will take effect in early May 2012. We are positive on this move as we believe it would help cover Carlsberg’s higher raw material costs to a certain extent.

“We have raised our fair value estimate to RM11.60, based on WACC of 8.4% (8.7% previously). Although this implies 20x FY12 PER, we note that Carlsberg has previously traded as high as 24x forward PER. Maintain Outperform,” it said.



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Stocks to Watch Axis REIT, Chin Well, Bumi Armada, CIMB, Hartalega

KUALA LUMPUR (April 16): Malaysia's stock market benchmark could take the cue from external factors on Tuesday as global economic headwinds take centre stage in a still-fragile macro landscape.

Analysts said dynamics across the US, China and European countries will be closely watched as investors assess the impact from these major importing nations on world financial markets.

In Malaysia, it will be interesting to see whether domestic funds could offer adequate support to the FBM KLCI against a still-volatile global backdrop which have thrown most Asian indices into the red.

The FBM KLCI of 30 stocks fell 5.61 points to close at 1,597.51 on Monday.

Stocks to watch on Tuesday include Axis Real Estate Investment Trust (Axis REIT), Bumi Armada Bhd, CHIN WELL HOLDINGS BHD [], CIMB Group Holdings Bhd, and HARTALEGA HOLDINGS BHD [].

Axis REIT's first quarter net profit rose 27% from a year earlier, as a higher top line and a revaluation surplus mitigated the impact of higher expenses. In a statement to the exchange on Monday, Axis REIT said its net profit came to RM20.96 million in the quarter ended March 31, 2012 versus RM16.49 million previously while revenue was up 18% to RM32.29 million from RM27.25 million.

Bumi Armada will offer oil and gas support services to Russia-based OAO Lukoil in a deal worth an estimated U$200 million (RM614 million). In a statement to Bursa Malaysia on Monday, Bumi Armada said the job includes engineering, procurement, installation and pre-commissioning of subsea in-field and inter-field pipelines for the Filanovsky field in the Caspian Sea.

Chin Well, a screw and bolt manufacturer, plans to pay a tax-exempt interim dividend of 2% for the financial year ending June 30, 2012.

Reuters reported that CIMB will enter into an agreement to acquire a controlling 60% stake in the Philippines-based conglomerate San Miguel Corp's unlisted banking arm "soon", quoting a senior board member. The deal will allow San Miguel — the Philippines's most diverse conglomerate — to keep a minority stake in the unlisted bank while focusing on its new ventures such as power, mining, telecoms, infrastructure, and more recently, airlines.

RHB Research Institute Sdn Bhd has slashed its net profit forecast for Hartalega, a nitrile glove manufacturer, by between 6.1% and 18.5% for financial years 2012 till 2014. The research house said it has taken into account the glove manufacturer's lower capacity utilisation, and average selling prices apart for costlier raw material and higher net interest expenses.



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