GDex 3Q net profit jumps 61% to RM2.11m

KUALA LUMPUR (May 9): GD EXPRESS CARRIER BHD []'s (GDeX) net profit jumped 61.07% for its third quarter ended Mar 31 to RM2.11 million from RM1.31 million a year ago, due to an increase in business volume and growth in its customer base.

In a statement on Bursa Malaysia on Wednesday, it said that its revenue for the quarter increased 24.49% to RM28.77 million from RM23.11 million.

Earnings per share were 0.82 sen compared to 0.51 sen a year ago, while net assets per share was 19 sen.

GDex attributed its strong performance to an increase in both business volume and growth of its customer base.

It added that the completion of a transshipment hub upgrading at the end of its first quarter had also helped support the increased business volume and handling capacity increased almost three fold in its third quarter.

The group said it had also adjusted its handling fee since in the previous quarter to cushion the rise it its operating costs, adding that it continues to be cautious in controlling its costs.

In the nine months ended Mar 31, it recorded a 25.31% increase in revenue to RM84.92 million from RM67.77 million a year earlier while net profit rose 39.42% to RM5.80 million from RM4.16 million.



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Frasers Hospitality to manage First Hotel Residence

KUALA LUMPUR (May 9): UOA Development Bhd has engaged Frasers Hospitality Pte Ltd to manage ten premium floors of its 34-storey Camellia Services Suites in Bangsar South.

The 34-storey development in Bangsar South, UOA's flagship mixed use development, will comprise 720 units with an estimated gross development value of RM500 million and is due to be completed by mid-2013.

In a statement Wednesday, UOA Development chief operating officer David Khor said the collaboration was a testament to its strong relationship with Frasers that was built upon mutual trust and admiration for our respective business practices and company cultures.

“It also serves as an ideal platform for both companies to work in synergy by leveraging on each other’s strong brand reputation and expertise to meet the increasing demand for quality hotel residences,” he said.

UOA Development said the ten premium floors comprising 240 units including two exclusive rooftop levels equipped for recreational and business activities would be managed by Frasers under a boutique hotel residence concept, Capri by Fraser.

A key feature of the hotel residence is its creative high-tech chilled out vibe, which will be reflected with its iPad activated check-ins that do away with formal paperwork and interactive e-concierge services to coordinate every aspect of the guest’s stay, from dinner reservations, spa treatments to transport arrangements, it said.

"The opening of the first Capri by Fraser in Malaysia is significant, not only because it further extends our presence in the country but also marks the launch of an exciting new hotel residence concept by Frasers, which reaffirms our confidence in the country’s strong growth potential,” added Fraser chief executive officer Choe Peng Sum.

“With an estimated 2.9 million business travellers projected to enter the country who will contribute US$1.2 billion (RM3.68 billion) in incremental Gross National Income (GNI) 1 by 2020, Malaysia is focused on becoming one of the top five meeting destinations in the Asia Pacific. We are confident that, with our partnership with UOA, we are well positioned to meet the anticipated burgeoning demand for good quality extended stay accommodation,” Choe added.



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KKB Engineering 1Q net profit falls 60% to RM7.71m

KUALA LUMPUR (May 9): KKB ENGINEERING BHD []'s net profit for the first quarter ended Mar 31, 2012 fell 60.82% to RM7.71 million from RM19.68 million a year ago, due to the completion of major projects in 2011 and the absence of new projects for both its CONSTRUCTION [] and steel fabrication divisions.

In a statement on Bursa Malaysia on Wednesday, it said that its revenue for the quarter decreased by 11.71% to RM52.54 million from RM59.51 million a year earlier.

Earnings per share were 2.99 sen compared to 7.63 sen, while net assets per share was 99 sen.

Reviewing its performance, KKB said that although revenue for its construction and steel fabrication divisions dropped 80.9% to RM5.1 million from RM26.8 million, its manufacturing arm managed to offset lower sales of liquified petroleum gas cylinders with strong sales of steel pipes by recording a 211.1% jump in revenue to RM30.8 million from RM9.9 million for the same quarter last year.

"The increased competitive nature of the engineering sector’s businesses coupled with the increasing cost of sales resulting from higher raw material costs have contributed to the lower earnings of the group," it added.



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PetGas posts net profit RM333.46m in 1Q2012

KUALA LUMPUR (May 9): PETRONAS GAS BHD [] (PetGas) posted net profit RM333.46 million for the three months ended March 31, 2012, which was relatively flat year-on-year.

The company said on Wednesday that its revenue for the quarter rose 2.6% of RM23.6 million to RM914.8 million, mainly due to higher utilities sales and gas transportation revenue.

“Profit before tax for the current quarter was RM446.9 million, a decrease of RM17.7 million (3.8%) from the preceding quarter ended 31 December 2011 mainly due to higher other expense resulting from unrealised loss from the revaluation of Currency Exchange Agreement (CEA) and retranslation of term loan,” it said.

Earnings per share was 16.85 sen while net assets per share was RM4.49.

Reviewing it s performance, PetGas said its earnings will remain stable as a result of the fixed fee structure under the Gas Processing and Transmission Agreement (GPTA) with additional earnings potential from performance based structure which is dependent on the level of production of by-products and their prices.

“The completion of the LNG Regasification Terminal in Melaka within the next twelve months will have a positive impact to the group’s earnings in terms of additional income from regasification and transportation services,” it said.

On its outlook, PetGas said prospects for the utilities business will mainly depend on petrochemical customer demand.

“Any variation in gas price will be immediately reflected in the pricing to customers,” it said.



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MMHE 1Q net profit falls 39.16% in 1Q12 to RM78.27m

KUALA LUMPUR (May 9): Malaysia Marine and Heavy Engineering Holdings Bhd (MHB) net profit for the first quarter ended Mar 31, 2012 fell 39.16% to RM78.27 million from RM128.64 million a year ago due to the completion of contracts under its engineering and CONSTRUCTION [] arm as well as its marine conversion and repair arm.

In a statement on Bursa Malaysia on Wednesday, the group said its revenue also decreased 27.95% to RM665.27 million from RM923.29 million a year earlier.

Earnings per share were 4.90 sen compared to 8.00.

MHB attributed the lower earnings to the completion of its engineering, procurement, construction, installation and commissioning (EPCIC) contract in Turkmenistan and its progress on two conversion contracts as well as higher rigs and support vessel repair works secured during the quarter.



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Sime Darby, CapitaMalls to jointly develop RM500m mall in Klang Valley

KUALA LUMPUR (May 9): Sime Darby Property Bhd and CapitaMalls Asia Ltd will jointly develop a RM500 million shopping mall in Taman Melawati in the Klang Valley.

In a joint statement Wednesday, the two companies said they had entered into a conditional agreement to form a 50:50 joint venture to develop the mall on a freehold site in Taman Melawati.

The two companies said the site had an area of about 242,000 sq ft.

"It is located in the centre of Melawati Township and is the last sizeable plot of commercial land in the township," they said.

CapitaMalls and Sime Darby Property said the shopping mall would have a a total net lettable area of about 635,000 sq feet on the site.

"The shopping mall is expected to be completed in 2016, and will serve a catchment population of around 800,000 people within a 10-minute drive," they said.

SIME DARBY BHD [] group chief operating officer Datuk Wahab Maskan, who is also managing director of Sime Darby Property, said the conglomerate was confident that its partnership with CapitaMalls to develop this site in Taman Melawati was the best strategy to maximise the returns on its investment and diversify its income portfolio.

“The synergistic partnership with CapitaMalls provides us the platform to leverage on their experience as the leading shopping mall developer, owner and manager in Asia,” he said.

CapitaMalls chief executive officer Lim Beng Chee said the project marked its first greenfield development in Malaysia.

“It will be the first major shopping mall in the established and affluent residential district of Taman Melawati, and will cater to the under-served retail needs of the residents there as well as the surrounding neighbourhoods.

“It will also provide both Malaysian and international retailers the opportunity to expand their presence to an established residential district in the Klang Valley,” he said.

He said this development would be CapitaMalls’s sixth mall in Malaysia.

CapitaMalls currently owns Queensbay Mall in Penang and — through its stake in CapitaMalls Malaysia Trust — owns Gurney Plaza in Penang, a majority interest in Sungei Wang Plaza in Kuala Lumpur, The Mines in Selangor and East Coast Mall in Kuantan.



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KLCI falls as eurozone woes grip global markets

KUALA LUMPUR (May 9): The FBM KLCI fell on Wednesday as concerns over the economic and political direction of several eurozone countries kept regional and global investors on tenterhooks.

The FBM KLCI lost 5.70 points to close at 1,584.90, weighed down by losses at blue chips.

Losers outpaced gainers by 450 to 273, while 313 counters traded unchanged. Volume was 1.28 billion shares valued at RM1.42 billion.

Asian bourses were mired in the red as Greece struggled to form a government two days after an election, heightening the risk that a hard-won bailout deal could be scrapped, according to Reuters.

Meanwhile, European shares edged lower on Wednesday as a technical rebound from four-month lows was offset by falls among Spanish banks, which were dragged by fears they would be forced to raise money to cover their property assets, said Reuters.

Technical momentum was supportive after key indexes in the US and Europe closed above support levels on Tuesday, sending a bullish short-term signal despite still-depressed market sentiment as a political impasse in Greece threatened to deepen the eurozone crisis, it said.

At the regional markets, the Shanghai Composite Index lost 1.65% to 2,408.59, Japan's Nikkei 225 lost 1.49% to 9,045.06, Taiwan’s Taiex fell 0.93% to 7,475.71, South Korea’s Kospi lost 0.85% to 1,950.29, Hong Kong’s Hang Seng Index shed 0.75% to 20,330.64 and Singapore’s Straits Times Index fell 1.06% to 2,900.91.

On Bursa Malaysia, BAT fell 64 sen to RM55.04, Petronas Dagangan and HLFG lost 24 sen each to RM19.70 and RM11.94, MISC 13 sen to RM4.46, PPB, MMHE and Aeon 12 sen each to RM16.60, RM4.88 and RM9.75 respectively, MSM 11 sen to RM5.20, IJM Corp 10 sen to RM5.44 and BLD PLANTATION []s fell nine sen to RM8.81.

Naim Indah Corp was the most actively traded counter with 80.2 million shares done. The stock was unchanged at 49 sen.

Other actives included Ingenuity Solutions, Metronic, Permaju, Harvest Court, Focus, Ariantec, Astral Supreme and CBSA.

Gainers included Tahps, GCE, GAB, Panasonic, Nadayu, YHS, KGB, Ajinomoto, Tasek and Sunway.



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Sabah expected to receive investment of more than RM1b from American company

KOTA KINABALU (May 9): Sabah is expected to receive an investment of more than RM1 billion from US-based company Dole, in the food and fruits industry.

Sabah Chief Minister Datuk Seri Musa Aman said further discussions are still being held to determine the best method of collaboration with one of the state government agencies.

"They, a major company in the food and fruits industry, have expressed deep interest in a collaboration. We are now seeking a suitable location while determining the form of collaboration with one of the state government agencies," he told reporters after officiating at the Putatan Agricultural Expo here on Wednesday.

Musa said foreign companies were keen to invest in Sabah as it was known as a peaceful state and suitable for investing, compared to some other places.

He also said Sabah had an opportunity to be among the key food producing states based on the cooperation among all parties in this district to drive the agricultural and agro-based industry sector.

"Agricultural expos such as this should be expanded to the other districts throughout the state, so that the potential of the sector can be fully harnessed," he added.

Musa said various and up-to-date information, as well as research findings could be applied through the expo and at the same time, ensure that the sector remains one that contributes to the enhancement of the economy in future.

He said under the five years of the Ninth Malaysia Plan, Sabah's economy had expanded at the rate of 5% annually, with the agricultural sector contributing RM7.24 billion to the 2010 gross domestic product compared to RM3.8 billion in 2005. — Bernama



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CBSA sees 8.33% stake traded off-market

KUALA LUMPUR (May 9): CBSA Bhd saw 20 million shares or an 8.33% stake transacted in several off-market deals at 50 sen each on Wednesday.

The 8.33% stake was based on its paid-up shares of 239.87 million shares.

Yesterday, the share closed at 43.5 sen which means the 50 sen a share paid was traded at 6.5 sen premium.

At 4.15pm, the share gained 0.5 sen to 44 sen with 19.47 million shares done.



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Felda Global bolsters downstream portfolio ahead of IPO

KUALA LUMPUR (May 9): Main Board-bound Felda Global Ventures Holdings Bhd (FGVH) is bolstering its downstream portfolio ahead of its IPO next month with the launch of new consumer branded products.

The group's downstream arm Delima Oil Products Sdn Bhd. -- a subsidiary of FGVH's 49%-owned Felda Global Holdings -- expects over RM1 bilion turnover from newly launched range of bread spread products marketed under SunBear brand, the company said in a statement on Wednesday.

Delima Oil CEO Zakaria Arshad did not gave a time frame for the expected sales but said some RM3 million had been invested in the new products -- peanut butter, peanut spreads and chocolate spreads -- which will soon be available at over 7000 outlets including hypermarkets and supermarkets nationwide. The earmarked amount includes production, advertising and promotion costs.

"The launch of our latest SunBear products is testimony of the company's on-going efforts to add variety to our product offerings beyond cooking oil and palm olein products, in line with consumer needs," Zakaria said in the statement. The group will continue to leverage on its distribution reach and build on its brand value, he added.

Delima Oil's existing porfolio includes Saji cooking oil, the market leader with 27% share of the olein segment, it said. It also produces and markets Tiara and Tiga Udang cooking oil. Other products include Seri Pelangi margarines.

In May last year, Delima Oil introduced four products under the Saji brand: mayonnaise, condensed milk, evaporated milk and instant noodles.



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M'sia's economy to remain stable in 2Q 2012

KUALA LUMPUR (May 9): Based on the latest economic indicators, Malaysia's economy is on a stable foundation and this is expected to continue in the second half of this year, the Dewan Negara was told on Wednesday.

Deputy Finance Minister Datuk Dr Awang Adek Hussein said that between January and February this year, the country's exports rose 7.1% while imports grew 10.2% compared with the same period last year.

"The industrial production index, meanwhile, expanded by 3.8%. In the same period, imports of capital goods recorded a high growth of 32.9% compared with the corresponding period last year.

"In addition, crude palm oil price as at April 25, 2012 was stable at RM3,450 per metric tonne while rubber was at RM10.88 per kilogramme," he said in reply to a question from Senator Tengku Aziz Tunku Ibrahim who asked on the government's level of readiness in facing the eurozone crisis.

Awang Adek said on the same date the KUALA LUMPUR COMPOSITE INDEX [] (KLCI) was at a higher level at 1,579 points against 1,530 points at end-December last year.

He said investors' confidence continued to rise supported by an increase in foreign investments of 12.3% to RM33 billion last year.

"Private investment activities are expected to be active spurred by business opportunities from the implementation of the Economic Transformation Programme and Government Transformation Programme as well as the government's key initiatives to attract investments," he said.

Meanwhile, Deputy Minister of International Trade and Industry Datuk Jacob Dungau Sagan said trade between Malaysia and Myanmar rose to RM2.42 billion last year from RM1.92 billion in 2010.

"Malaysia's exports to Myanmar grew to RM1.71 billion last year compared with RM1.18 billion the year before, while its imports from Myanmar amounted to RM710 million in 2011 and RM730 million in 2010.

"Malaysia's investments in Myanmar totalled US$977.6 million (RM2.99 billion) involving various investments such as CONSTRUCTION [], hotels, petroleum and manufacturing," he said.

Jacob said this in reply to a question from Senator Datuk Chiw Tiang Chai and Senator Datuk Mohammad Najeeb Abdullah who asked on the current status of investments and trade between Malaysia and Myanmar.

He said the government welcomed the changes in Myanmar which had started to practise a more open political and economic policies.

"The Ministry of International Trade and Industry is now actively taking efforts to strengthen bilateral relations as well as explore investment opportunities in Myanmar," he said. — Bernama



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Sunway, TRC up on units getting MRT Corp jobs

KUALA LUMPUR (May 9): Sunway Bhd and TRC SYNERGY BHD [] shares respectively rose on Wednesday after their units were named among the four companies awarded additional CONSTRUCTION [] packages worth RM3.22 billion for the Sungai Buloh - Kajang MRT.

At 3.20pm, Sunway jumped 12 sen to RM2.42 with 1.38 million shares traded while TRC was up two sen to 74.5 sen wih 1.08 million shares done.

MRT Corp on Wednesday said Sunway’s unit Sunway Construction Sdn Bhd and TRC's subsidiary, Trans Resources Corporation Sdn Bhd were among the four companies awarded the additional packages.

Sunway Construction were awarded package V4 for worth RM1.17 billion for works between Section 17, Petaling Jaya and the Semantan Portal, while Trans Resources Corporation were awarded the Depot package worth RM458.98 million for works related to the Sungai Buloh depot in an open tender category.

Meanwhile, Trans Resources Corporation was awarded the final package for works related to the Sg Buloh Depot.



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Theta Edge posts net loss RM1.49m in 1Q

KUALA LUMPUR (May 9): Theta Edge Bhd posted net loss RM1.49 million in the first quarter ended March 31, 2012 compared to net profit RM80,400 a year earlier, due to the small margins derived from the trading revenue which was insufficient to cover the group overheads.

The company said on Wednesday that its revenue for the quarter fell to RM19.37 million from RM21.24 million in 2011.

Loss per share was 1.39 sen compared to earnings per share of 1.27 sen, while net assets per share was 79 sen.

On its prospects, Theta Edge said it expects that the financial year 2012 would remain challenging.

“Barring any unforeseen circumstances, the board expects improved performance for the financial year ending 2012 as compared to financial year 2011,” it said.



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Moody's: Asian Liquidity Stress Index stabilises in April

KUALA LUMPUR (May 9): The Asian Liquidity Stress Index (Asian LSI) has stabilised to 15.3% in April after the downgrade to upgrade ratio moderated, according to Moody's Asia Liquidity Stress Index report.

in a statement on Wednesday, Laura Acres, a Moody's vice president and senior credit officer said that in April, the liquidity sub-index for Chinese speculative-grade companies stood at 15.6%, down from the high of 18.6% in March.

“While there was some improvement for the liquidity of Chinese property companies, it remains of note that almost one in four of such companies have weak liquidity," she said.

Moody’s said the index, which increases when speculative-grade liquidity appears to decrease, is near its highest level since October 2010.

However, it remains well below the high of 37% recorded in 4Q08 during the financial crisis, it said.

It stabilised to 15.3% in April compared to 15.5% in March, as the downgrade to upgrade ratio moderated with just one downgrade compared to one upgrade after three quarters of downgrades exceeding upgrades, it said.

In absolute terms, 15 of the 98 issuers in the speculative-grade portfolio demonstrated weak liquidity as at end April compared with 15 of 97 issuers in March.

"As such, a strong negative bias remains with almost 40% of the speculative-grade portfolio having a negative outlook or being on review for downgrade," Acres said.

Moody's still expects a moderate erosion of liquidity this year, as a tight credit supply in China flows through to the wider corporate space.

In 1Q12 in Asia, concerns about euro area sovereign debt and a more general economic slowdown seemed to ease as markets reopened and investors showed appetite for Asian risk.

However, more recently, a level of caution has prevailed and there remain several deals in the market yet to complete.



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Sunway, TRC Synergy among beneficiaries of 4 additional packages of RM3.2b for MRT

KUALA LUMPUR (May 9): Sunway Bhd's unit Sunway CONSTRUCTION [] Sdn Bhd and TRC SYNERGY BHD []'s subsidiary, Trans Resources Corporation Sdn Bhd, are among the companies that secured four additional construction packages worth RM3.22 billion for the Sungai Buloh - Kajang MRT.

"After the award of the Viaduct 5 and Viaduct 6 packages in January (to IJM Construction Sdn Bhd and Ahmad Zaki Sdn Bhd respectively), and the award of the underground package in March (to MMC-Gamuda JV), these awards show further progress for the Sungai Buloh-Kajang line," said Datuk Azhar Abdul Hamid, MRT Corp CEO, in a statement on Wednesday.

The packages - Viaduct 1, Viaduct 4, Viaduct 7 and Depot 1 - are worth RM3.22 billion and include the construction and completion of viaduct guideways and related works while the depot package is for the construction of the Sungai Buloh Depot and related buildings.

Sunway Construction was awarded package V4 worth RM1.17 billion for works between Section 17, Petaling Jaya and the Semantan Portal, while Trans Resources Corporation was awarded the Depot package worth RM458.98 million for works related to the Sungai Buloh depot in an open tender category.

Meanwhile, package V1 worth RM1.09 billion, a bumiputera exclusive package, covering works between Sungai Buloh and Kota Damansara was clinched by Syarikat Muhibbah Perniagaan and Pembinaan Sdn Bhd and package V7 worth RM499.98 million was secured by MTD Construction Sdn Bhd for works between Bandar Tun Hussein Onn and Taman Mesra in Cheras, said MRT Corp.


"The evaluation looks at various factors, including technical capability, financial strength and of course price. The key is finding a fit that will ensure the project gets the best technical input from a capable contractor while maintaining costs within our expectation for the packages," he explained.

MRT Corp said it expected to award more tenders over the next month.



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Southern Steel in JV with Belgian firm to make steel wires in Asean region

KUALA LUMPUR (May 9): SOUTHERN STEEL BHD [] has entered into a joint venture (JV) agreement with Belgium-based NV Bekaert SA (NV BK) to form a JV company in Singapore to manufacture specified steel wires in the ASEAN region.

Southern Steel said in a filing on on Wednesday that it would hold 45% in the JV and NV BK the remaining 55%.

“NV BK is a public company listed on Euronext Brussels (BEKB).

“It is a global player in drawn steel wire products and technologically strong in advanced solutions based on metal transformation and coatings. Presently, NV BK serves customers in more than 120 countries,” it said.

Southern Steel said it would sell its entire equity interests in three of its subsidiaries to the JV company while NV BK would sell its entire stake in its Indonesian subsidiary to the JV for an aggregate consideration of the equivalent of US$44.6 million.

Southern Steel said it would sell its entire equity interests in its wholly-owned subsidiaries, Southern Speciality Wire Sdn Bhd (“SSW”) and Southern Wire Industries (Malaysia) Sdn Bhd (“SWI”) together with its wholly-owned subsidiary, Cempaka Raya Sdn Bhd to the JV Co.

It said NV BK will sell its entire galvanized and multi-coated wire business in Indonesia currently undertaken by its Indonesian subsidiary, PT Bekaert Indonesia to the JV Co

Southern Steel said the JV would provide it the opportunity to expand its steel wire manufacturing and sale business and to jointly promote the Southern Steel and NV BK brand in the Aseaon market.



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KLCI remains in the red at mid-day as Asian markets slide

KUALA LUMPUR (May 9): The FBM KLCI remained in the red at the mid-day break on Wednesday in line with the slump at key regional markets, following the overnight fall at Wall Street.

At 12.30pm, the FBM KLCI was down 3.04 points to 1,587.56, weighed by select blue chips.

Losers beat gainers by 386 to 207, while 286 counters traded unchanged. Volume was 692.41 million shares valued at RM558.87 million.

The ringgit weakened by 0.34% to 3.0675 versus the greenback, crude palm oil futures fell RM6 per tonne to RM3,334, crude oil fell 35 cents per barrel to US$96.66 while gold lost US$14 an ounce to US$1,591.48.

Shares, gold and oil fell and the euro remained pressured on Wednesday as Greece struggled to form a government two days after an election, heightening the risk that a hard-won bailout deal could be scrapped, according to Reuters.

Radical leftist Alexis Tsipras meets the leaders of Greece's mainstream parties on Wednesday to try to form a coalition government, an effort seen as doomed after he demanded that pledges made in exchange for an European Union/International Monetary Fund rescue package be torn up, it said.

Officials estimate Greece could run out of money as soon as next month if it does not stick to the aid package terms, which kept the country solvent and in the single currency bloc, said Reuters.

At the regional markets, Japan’s Nikkei 225 lost 1.62% to 9,032.78, Hong Kong’s Hang Seng Index fell 0.94% to 20,292.00, the Shanghai Composite Index fell 1.33% to 2,416.28, Taiwan’s Taiex shed 0.86% to 7,480.85, South Korea’s Kospi fell 1.10% to 1,945.31 and Singapore’s Straits Times Index shd 0.65% to 2,912.84.

On Bursa Malaysia, BAT fell 48 sen to RM55.20, F&N down 16 sen to RM18.88, Petronas Dagangan 14 sen to RM19.80, Sarawak PLANTATION []s and MSM lost 11 sen each to RM2.92 and RM5.20, Sarawak Oil Palms and Iretex down 10 sen each to RM6.56 and RM1.20, while BLD Plantations and IJM Corp fell nine sen each to RM8.81 and RM5.45.

Harvest Court was the most actively traded counter with 48.1 million shares done. The stock fell half a sen to 70.5 sen.

Other actives included Permaju, Metronic, Ingenuity Solutions, Naim Indah Corp, Ariantec, Focus, CBSA and Perisai.

Gainers in the morning session on Wednesday included GAB, KGB, Cybertowers, MTD ACPI, Rubberex, United Plantations, Sunway, Ajinomoto, Mercury and Kawan Food.



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Malayan Flour Mills allocates RM120m to expand Malaysian ops over the next two years

KUALA LUMPUR (May 9) : MALAYAN FLOUR MILLS BHD [] (MFM) is allocating some RM120 million to expand its flour factory and poultry operations in Malaysia over the next two years.

Managing director Teh Wee Chye said the capital expenditure will be financed with the firm's internal funds and bank loans.

"We need to increase efficiency in our operations," Teh said at the company's shareholders meeting here today.

MFM has also earmarked USD15 million to expand its two flour factories in Vietnam, he said.



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KLCI hovers in negative territory at mid-morning

KUALA LUMPUR (May 9): The FBM KLCI hovered in negative territory at mid-morning on Wednesday in line with the overnight fall at Wall Street and weaker sentiment at regional markets, underpinned by global economic and political worries.

At 10.01am, the FBM KLCI fell 3.03 points to 1,587.57, weighed by select blue chips.

Gainers trailed losers by 132 to 234, while 219 counters traded unchanged. Volume was 237.19 million shares valued at RM17908 million.

Asian shares fell and the euro stayed pressured on Wednesday, as Greece struggled to form a government two days after elections, raising the risk that a hard-won bailout could be nullified, according to Reuters.

BIMB Securities Research in a note Wednesday said the conditions in Europe was ripe for traders to create some volatility in the equity markets and yesterday could be the beginning of the trend.

With the initial focus on Spain and now the political issues in France and Greece, investors may be in for a roller coaster ride this month, it said.

Reacting to the European uncertainty, the Dow Jones Industrial Average sank 76.44 points to 12,932 but off its intra-day low of 12,810, it said.

“Needless to say, European bourses took the brunt of yesterday’s selling as all ended up in a sea of red,” it said.

The research house said regional markets had a mixed session possibly from the weak opening in Europe amid the ongoing consolidation mode.

“Locally, the FBM KLCI rebounded by 5.73 points to just above the immediate 1,590 resistance at 1,590.60.

“For today, it will be interesting to gauge the resilience of investors whether they will all jump into the selling bandwagon. For us, we believe there will be some broad based knee jerk reaction and should pressure the FBM KLCI on the downside,” it said.

On Bursa Malaysia at mid-morning, F&N Fell and Petronas Dagangan fell 14 sen each to RM18.90 and RM19.80, Hong Leong Bank and Genting down 12 sen each to RM12.12 and RM10.54, Sarawak PLANTATION []s 11 sen to RM2.92, Rapid and IJM Corp 10 sen each to RM2.57 and RM5.44, while NPC, MAHB and Ajiya lost eight sen each to RM2.60, RM5.71 and RM1.60 respectively.

Permaju was the most actively traded counter with 25.7 million shares done. The stock rose 3.5 sen to 91 sen.

Other actives included Harvest Court, Naim Inda Corp,Perisai, Sanbumi, Metronic, Compugates, JCY and Komark.

Gainers included KGB, Tasek, Komark, KLK, Mercury, CIMB, SKB Shutters, Multico, Perisai and Permaju.



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CIMB up on plans to acquire Philippines bank stake

KUALA LUMPUR (May 9): CIMB Group Holdings Bhd shares advanced on Wednesday after it entered into conditional share purchase agreements (SPA) with San Miguel PROPERTIES [] Inc, San Miguel Corporation Retirement Plan and various minority shareholders for the proposed acquisition of 60% of Bank of Commerce (BoC) in the Philippines.

At 9.15am, CIMB was among the top gainers and added eight sen to RM7.71 with 1.82 million shares traded.

In a statement on Tuesday, CIMB said the acquisition was for the equivalent of RM881 million cash.

MIDF Research maintained it Neutral rating on CIMB with a target price of RM7.70 and said the deal would be neutral to its financials in FY12 with only 3 to 4 months of consolidation impact after its completion in 3QFY12.

“Even in FY13, we do not expect a significant earnings accretion as the cost-to-income ratio for Group is likely to inch up marginally due to investments in IT infrastructure and human capital for its expansion to Philippines.

“It is also expected that the provisioning in BoC post acquisition to be raised to align to the provisioning policies of CIMB Group. Our TP implies a marginal 0.9% upside from the current share price. Hence we maintain our Neutral call,” it said in a note May 9.



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Maybank IB Research upgrades Ann Joo to Buy, raises TP to RM2.20

KUALA LUMPUR (May 9): Maybank IB Research has upgraded ANN JOO RESOURCES BHD [] to a Buy with and raised it target price to RM2.20 (from RM1.30).

In a note Wednesday, Maybank IB Research said it was turning positive on Ann Joo due to: (i) pent-up local steel demand from 2H12 onwards; (ii) a potential long-term high-margin vendor contract from Petronas; (iii) stronger earnings in 2H12 upon the completion of the fine-tuning of its mini-blast furnace (BF) offsetting continued expected losses in the upcoming 1Q12 results.

“We maintain our forecasts for now but our TP is raised to MYR2.20 (from MYR1.30), as we attach a mid-cycle 1.0x P/BV target (vs. 0.6x trough),” it said.



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CIMB Research maintains Outperform on Perisai , target price RM1.50

KUALA LUMPUR (May 9): CIMB Research has maintained its Outperform rating on PERISAI PETROLEUM TEKNOLOGI [] Bhd at 89 sen with a target price of RM1.50 and said Perisai kicked off its move into the drilling segment with the award of a CONSTRUCTION [] contract for a jack-up rig and an option on another.

In a note Wednesday, the research house said each rig could boost net profit by RM40 million per annum effective 2H14, allowing the company to enjoy yearly record net profits at least until FY16.

“Even without the new rigs, FY12-14 are already shaping up to be record years for Perisai. We continue to value the stock at our CY13 target market P/E of 13x.

“Perisai remains an Outperform and our top small-cap oil & gas pick. This announcement could be a significant re-rating catalyst as the market has been anticipating new assets,” it said.



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MIDF Research maintains Neutral on Hartalega, ups target price to RM7.50

KUALA LUMPUR (May 9): MIDF Research has maintained its Neutral rating on HARTALEGA HOLDINGS BHD [] and raised it target price to RM7.50 (from RM7.06 previously), which it said was derived from Hartalega's higher 3-year historical average PE ratio of 12 times, based on its FY13 estimated EPS of 62.5 sen per share.

“We are of the opinion that at the current price, the stock fairly reflects its fundamentals, thus limiting its upside potential.

“Therefore, we maintain our NEUTRAL call on the stock,” the research house said in a note Wednesday.



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Stocks to Watch CIMB, Kencana, Hartalega, Grand-Flo

KUALA LUMPUR (May 8): A slew of corporate announcements, including CIMB Group Holdings Bhd's planned acquisition of 60% of Bank of Commerce (BoC) in the Philippines, could help pique investors' appetite at Bursa Malaysia on Wednesday.

Elsewhere, investor sentiment remains on tenterhooks as the weekend results of elections in Europe have raised the specter of the troubles faced by the beleaguered eurozone.

Investors sold European shares and the euro on Tuesday, unnerved by the political stalemate in Greece and the threat of a Franco-German split over policies to tackle the region's debt crisis, according to Reuters.

Among the stocks that could be in focus are CIMB Group Holdings Bhd, KENCANA PETROLEUM BHD [], HARTALEGA HOLDINGS BHD [] and GRAND-FLO SOLUTION BHD [].

CIMB Group Holdings has entered into conditional share purchase agreements (SPA) with San Miguel PROPERTIES [] Inc, San Miguel Corporation Retirement Plan and various minority shareholders for the proposed acquisition of 60% of Bank of Commerce (BoC) in the Philippines. In a statement on Tuesday, CIMB said the acquisition was for the equivalent of RM881 million cash.

Kencana's unit Kencana HL Sdn Bhd has been awarded a RM460 million engineering, procurement, CONSTRUCTION [] and commissioning (EPCC) contract from Murphy Sarawak Oil Co Ltd. In a statement on Bursa Malaysia on Tuesday, it said that Kencana HL had received a letter of award from Murphy for the fabrication of offshore topsides.

Hartalega declared a third interim dividend of six sen per share single tier for the financial year ended March 31, 2012, to be paid on June 13. Its net profit for the fourth quarter ended March 31, 2012 fell 4.55% to RM50.01 million from RM52.39 million a year earlier, despite a 24.77% increase in revenue to RM240.22 million.

The company said on Tuesday that the significant increase in revenue was in line with the continuous expansion in production capacity and increase in demand. However, its bottom line was impacted by the increase in raw material prices of nitrile latex, fuel costs and more competitive sales pricing for the current quarter compared with the corresponding quarter of the preceding year, it said.

Grand-Flo's net profit for the first quarter ended March 31, 2012 rose 5.91% to RM2.22 million from RM2.09 million a year earlier, due mainly to strong tracking solutions sales abroad. It said on Tuesday that its revenue jumped 19.6% to RM20.37 million from RM17.03 million. Meanwhile, earnings per share were 1.39 sen compared to 1.44 sen a year ago.

Grand-Flo proposed a final dividend of 1.2 sen per share, comprising a gross dividend of 0.037 sen per share and a tax exempted dividend of 1.163 sen per share for foteh financial year ended Dec 31, 2011. Grand-Flo said that in line its results, it proposed to set a dividend policy to distribute a minimum 20% of its net profit as annual dividends to shareholders effective from the financial year ended Dec 31 2011, subject to shareholders' approval.



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