CIMB Research has technical buy on Sanichi at 12.5 sen

KUALA LUMPUR (March 14): CIMB Equities Research has a technical buy on Sanichi TECHNOLOGY [] at 12.5 sen at which it is trading at a price-to-book value of 2.6 times.

The research house said on Wednesday Sanichi Technology is consolidating in a bullish wedge pattern.

“We are waiting for a breakout above its wedge resistance before going long. However, only risk takers should look at this stock due to its volatility,” it said.

CIMB Research said that as long as the candles hold above the 12 sen level, it thinks the odds still favour the bulls.

The research house said traders should be quick to cut loss if this level is breached. The next resistance levels are 15 sen and 16.5 sen.

“Technical landscape remains conducive. MACD signal line is poised for a positive crossover while RSI has bounced back from its lows,” it said.



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KL shares continue uptrend at midafternoon

Shares on Bursa Malaysia extended their gains at mid-afternoon today on bargain-hunting ahead of year-end, dealers said.

At 3pm, the underlying FTSE Bursa Malaysia KLCI (FBM KLCI) rose 3.49 points, or 0.23 per cent, to 1,507.60 after opening 4.06 points lower at 1,500.05.

A dealer said interest was confined to the plantation and banking counters with investors confident that these segments would perform well next year.

KL Kepong advanced 32 sen to RM22.90, Sime Darby gained five sen to RM9.04, RHB Capital jumped 14 sen to RM7.27 and CIMB rose four sen to RM7.14.

Trading was positive with gainers outpacing losers by 414 to 229 while 296 counters were unchanged. Volume stood at 1.06 billion worth RM627.35 million.

The Finance Index rose by 50.84 points to 13,425.06, Plantation Index increased 18.42 points to 8,087.28 and the Industrial Index gained 22.98 points to 2,731.00.

The FTSE Bursa Malaysia Emas Index added 33.43 points to 10,352.12, FTSE Bursa Malaysia Mid 70 Index advanced 49.97 points to 11,486.27 and the FTSE Bursa Malaysia Ace Index was 20.44 points higher at 4,075.24.

Of the volume leaders, Sanichi Technology rose 2.5 sen to 17.5 sen and Wijaya-Warrants was up 4.5 sen to 43.5 sen. 1 Utopia, however, lost half sen to seven sen,

Among heavyweights, Maybank declined one sen to RM8.33, Petronas Chemicals rose one sen to RM6.16 and Axiata was two sen higher at RM5.01. -- BERNAMA



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Time to shorten disclosure time frame?

In the past few months, Bursa Malaysia has seen some interesting shareholding changes in some penny stock companies.

Companies such as Envair Holdings Bhd, Sanichi Technology Bhd and DVM Technology Bhd have seen quick enter-and-exit shareholders. The three are listed on the ACE Market whose market capitalisations are below RM50 million.

The roller coaster rides of the share prices that coincide with substantial shareholding changes raise the question whether the existing time frame for disclosures on changes in substantial holdings should be tightened further.

According to the Companies Act 1965, substantial shareholders need to notify the listed company within seven days of the shareholding transaction. This also applies to emerging and ceasing substantial shareholders.

Under Bursa Malaysia’s ACE Market Listing Requirements, the listed companies are required to make an immediate announcement to the stock exchange upon receipt of notifications from substantial shareholders.

But, is seven days too long considering the significant impact insider moves could have on share price movement?

This is because while these new substantial shareholders had immediately notified the companies of their emerging substantial stakes, it took some of them awhile to notify the companies when paring down their stakes.

Take Envair Holding Bhd for example.

Carpet Raya Sdn Bhd director Deepak Jaikishan emerged as a substantial shareholder in Enviar on Dec 2 with a stake of 5.06%. He then sold the entire stake less than two weeks later on Dec 14.

The announcement of Deepak becoming a substantial shareholder was made to the stock exchange on the very same day he acquired the shares. However, the announcement of his exit was made seven days later, although that was within the regulated time frame.

Before Deepak’s entry and exit, the Envair also saw the entry and exit of two Chinese nationals.




On Nov 1, Chinese national Jiang Chuan Yi emerged as a substantial shareholder when he bought a 6.75% stake in a direct deal on Nov 1. He then sold the same stake on Nov 23, and announced to the exchange on the same day. Envair rallied 277% to 41.5 sen on Nov 1 from 11 sen a month earlier.

It had pared down since to close at 32 sen yesterday. Prior to that, Envair was trading quietly between eight sen and 14.5 sen.

Last month, Envair announced that it was entering the oil and gas business by supplying two million barrels of light crude oil monthly to a Chinese company for a five-year duration.

Another Chinese national, Zhang LiYing bought 10.8 million Envair shares or a 9.11% stake in a direct deal on Oct 13 but it was only notified on Nov 2.

Zhang then sold off the 10.8 million shares on Dec 14 on the open market, and notified Bursa Malaysia on Dec 16. It is not known if Jiang and Zhang are linked to the Chinese company.

Another company that saw quick entry-and-exit shareholding changes is Sanichi.

On Aug 3, Mohd Wira Abdul Daim, the son of former finance minister Tun Daim Zainuddin, emerged as a substantial shareholder in Sanichi after he bought a 6.12% equity stake.

The transaction was immediately notified to Sanichi and Bursa Malaysia on the same day the shares were bought. Wira only held the stake for two days before he sold all 10 million shares on Aug 5. However, the notification was only filed with Bursa Malaysia six days later on Aug 11.

Sanichi rose to an earlier 15-month high of 10.5 sen on the next day after the announcement that Mohd Wira bought into the company. Prior to that, Sanichi was only trading in the range of 3.5 sen and six sen.

Trading of Sanichi shares were halted on Aug 4 at 4.05 pm due to an announcement that a Germany firm Projektarbelt Technische Beratung Venretung International (Protev) is commencing due-diligence process on the company.

Sanichi and Protev had earlier signed a memorandum of understanding (MoU) to form an alliance to set up a one-stop plastic injection mould fabrication solution centre. After Mohd Wira’s entry-and-exit, Sanichi’s shares slumped back to as low as four sen on Aug 29, down 62% from the peak of 10.5 sen.

Its shares later saw another spike that could be linked to an agreement with an Indonesian company to market and distribute three million metric tonnes of coal annually in China.

Sanichi had triggered two unusual market activity (UMA) queries from Bursa Malaysia — on Nov 8 and Dec 12. Sanichi closed at 13 sen yesterday.

Until today, it is not known why Mohd Wira had emerged as substantial shareholder in Sanichi for barely three days.

Meanwhile, DVM Tech also saw a quick entry-and-exit shareholder.

On Aug 2, Raymond Yip Wai Man bought 12.98 million shares or a 7.4% stake on the open market in DVM Tech. He then bought another 1.43 million and 3.95 million shares in two separate open market transactions on Aug 4 and 12 respectively, bumping his stake to 10.43%.

However, he ceased to be a substantial shareholder when he disposed 9.8 million shares on Aug 15. The disposal was only filed on Aug 18 while the acquisitions were filed on the days they were purchased.

On Aug 2, Danish citizen Christian Kwok-Leun Yan Heilesen bought 12.05 million DVM Tech shares, or a 6.85% stake on the open market. DVM Tech had closed at 25 sen that day. The transaction was notified to the company and Bursa Malaysia on Aug 4.

On Aug 12, he acquired an additional 4.6 million shares, bumping his shareholding to 9.46%. The notice was filed on the same day.

On Aug 15, Heilesen ceased to be a substantial shareholder when he sold 8.35 million shares. DVM Tech closed at 15 sen on Aug 15. The notice was only filed with Bursa Malaysia three days later.

DVM Tech saw its share price surge 233% to 25 sen on Aug 2, from 7.5 sen a month earlier. It had since fallen to close at 8.5 sen yesterday.

What is interesting about these three companies is that they have seen their share price increase prior to the emergence of the shareholders, and then on a declining trend after that.

In some instances, the substantial shareholders had taken some time (although all within the seven days time frame) before notifying their shareholding changes to the companies.

As such, there could be instances where retail investors bought shares in a company due to the entry of new shareholders, only to see the same shareholders exit the company at the same time.

While it is not known why these shareholders had quickly entered and exited these companies, perhaps it is time for regulators to consider shortening the disclosure period from seven days.

This is in line with how fast information is disseminated these days via the Internet and mobile services, and how efficient and sensitive markets are to news.

After all, the present seven-day disclosure rule was shortened from 14 days earlier. With current technology and reduced dependence on snail mail, perhaps a shorter period is now warranted?

A shorter period would be good to prevent any instances of speculation due to the emergence of new shareholders.


This article appeared in The Edge Financial Daily, December 23, 2011.



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KL shares slightly higher at midday

Share prices on Bursa Malaysia ended the morning session marginally firmer, but in quiet trading, despite regional markets winding down ahead of the festive holidays.

Dealers said the benchmark FBM KLCI could swing between its immediate support and resistance levels of between 1,475 and 1,500 pending the emergence of fresh market leads. At 12.30pm, the FBM KLCI ended at 1,485.92, up 0.94 of a point.

The Finance Index rose 17.29 points to 13,284.93, the Plantation Index increased 12.560 points to 7,920.02 and the Industrial Index perked 0.2 point of a point to 2,663.02. The FBM Emas Index added 7.940 points to 10,178.4, FBM Mid 70 Index gained 26.521 points to 11,190.99 but the FBM ACE Index declined 38.74 points to 4,027.65.

Losers led gainers 380 to 212 while 274 counters were unchanged. Turnover stood at 629.408 million shares worth RM397.789 million.

Of the active counters, TMC Life Sciences Bhd-Warr added 11.5 sen to 12 sen while Hibiscus Petroleum Warr 11/14 and Sanichi Tech both gave up 1.5 sen each to 50.5 sen and 14 sen, respectively.

In heavyweights, Maybank rose one sen to RM8.38, Sime Darby was unchanged at RM9.00 and CIMB firmed four sen to RM6.99. -- Bernama



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KL shares firmer at mid-morning

Share prices on Bursa Malaysia were firmer at mid-morning today, dealers said. They said the Asian equities would probably consolidate their gains chalked up yesterday.

Dealers said the benchmark FBM KLCI could swing between its immediate support and resistance levels of 1,475 and 1,500 respectively, pending the emergence of fresh market leads.

At 11.15am, the FBM KLCI inched up 0.06 point to 1,485.04.

The Finance Index rose 6.740 points to 13,274.38 and the Plantation Index increased 6.680 points to 7,919.56.

The Industrial Index, however, shed 0.72 point to 2,662.1. The FBM Emas Index was up 0.65 point to 10,171.11 and FBM Mid 70 Index added 15.59 points to 11,180.06. The FBM ACE Index, however, declined 33.33 points to 4,033.06.

Losers led gainers by 329 to 176 while 269 counters were unchanged. Turnover stood at 477.675 million shares worth RM248.815 million.

Of the active counters, TMC Life Sciences Bhd-Warr added 11 sen to 11.5 sen, Hibiscus Petroleum Warr 11/14 inched up two sen to 50 sen and Sanichi Tech shed 1.5 sen to 14 sen.

In heavyweights, Maybank rose one sen to RM8.38, Sime Darby was unchanged at RM9.00 and CIMB firmed five sen to RM7.00. -- Bernama



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KL shares open softer in cautious trade

Share prices on Bursa Malaysia opened softer this morning in cautious trading, dealers said. The FBM KLCI opened 0.38 points lower at 1,484.6 and trended lower to 1,484.05 at 9.50am.

However, the Finance Index rose 0.27 points to 13,267.37, Plantation Index increased 14.69 points to 7,922 and the Industrial Index gained 1.2 points to 2,664.02. The FBM Emas Index declined 4.55 points to 10,165.91, FBM Mid 70 Index added 9.601 points to 11,174.07 and the FBM ACE Index shed 29.84 points to 4,036.55.

Losers led gainers 234 to 151 while 206 counters were unchanged. Turnover amounted to 288.949 million shares worth RM123.920 million.

Of active counters, TMC Life Sciences Bhd-Warr added 11 sen to 11.5 sen, Sanichi Tech shed one sen to 14.5 and Integrated Rubber Corp increased one sen to 17 sen. In heavyweights, Maybank rose one sen to RM8.38, Sime Darby eased one sen to RM8.99 and CIMB added three sen to RM6.98. -- Bernama



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Stocks to watch: Coastal Contracts , Sanichi, Dialog, JCY

KUALA LUMPUR (Dec 16): Regional markets including Bursa Malaysia could trade on a cautious note on Friday as investors’ risk appetite for equities would be restrained by worries about the global economy and Europe's debt crisis but the firmer overnight close on Wall Street could provide some encouragement.

U.S. stocks rose on Thursday, as signs of strength in the economy and higher-than-expected profit at FedEx outweighed more warnings about Europe.

The Dow Jones industrial average was up 45.33 points, or 0.38 percent, at 11,868.81. The Standard & Poor's 500 Index was up 3.93 points, or 0.32 percent, at 1,215.75. The Nasdaq Composite Index was up 1.70 points, or 0.07 percent, at 2,541.01.

At Bursa Malaysia, stocks which could see trading interest include COASTAL CONTRACTS BHD [], SANICHI TECHNOLOGY [] BHD [], DIALOG GROUP BHD [] and hard-disk drive manufacturer JCY International Bhd.

Coastal Contracts’s year-to-date order wins rose to RM690 million after the company secured new contracts worth RM233 million for the sale of three offshore support vessels, two landing crafts and two barges.

“With this latest batch of contracts, the value of Coastal Group’s secured vessel sales orders currently stood at about RM610 million, with deliveries through 2012,” it said.

Sanichi, whose shares inched up in very active trade on Thursday, could see continued trading action. It received a letter of intent from China’s Guangxi Huayin to purchase 150,000 tonnes of steam coal per month, totaling 1.80 million tonnes for a one-year period.

Sanichi said Guangxi Huayin is one of the largest and most advanced aluminium producers in China and the shareholders include the Aluminium Corporation of China with a 33% stake.

Meanwhile Dialog Group Bhd, which is undertaking a cash call to raise funds for more investments in the upstream oil and gas opportunities, has fixed the rights shares at RM1.20 each and the exercise price of the warrants at RM2.40 each.

The issue price would be a discount of about 46% to the theoretical ex-rights price of RM2.23 per share, based on the five-day volume-weighted average market price (VWAMP)up to Dec 14 of RM2.43.

As for the warrants, it said the exercise price was 8% above the theoretical ex-rights price of RM2.23 per share, based on the five-day VWAMP up to Dec 14 of RM2.43.

JCY could see continued trading interest as it was not impacted by the severe floods in Thailand unlike other hard-disk drive manufacturers which had major operations in Thailand.

CIMB Equities Research said believed a full restoration to pre-flood production was at least six to nine months away, but suppliers with strong balance sheets to invest could benefit from greater allocations in the near term.

“Improvements in average selling prices (ASP) for drive makers should also be positive for the industry,” it said. It advised investors to be selective as it believed volume would remain hindered by component shortages.

“Buy JCY as we expect strong near-term earnings on higher ASPs and allocations,” it said.



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Sanichi gets LOI for 1.8m tonnes of steam coal

KUALA LUMPUR (Dec 15): SANICHI TECHNOLOGY BHD [] has received a letter of intent from China’s Guangxi Huayin to purchase 150,000 tonnes of steam coal per month, totaling 1.80 million tonnes for a one-year period.

Sanichi said Guangxi Huayin is one of the largest and most advanced aluminium producers in China. Guangxi Investment Group Co. Ltd hold a 34% stake, Minmetals Aluminium Company Ltd (33%) and Aluminium Corporation of China (33%).

“The LOI enable Sanichi to commence negotiations with its supplier(s) to obtain firm commitments to match the buyer’s specifications and requirements,” it said.

It said the earnings would from the trading margin between Sanichi’s selling price to the buyer and the company’s buying price from its supplier(s).

“The company expects to obtain shareholders approval by first quarter of 2012 and therefore, it is anticipated that the commencement of supply of steam coal to the buyer will be no later than end of quarter two of 2012,” it said.

Sanichi said based on the estimated net profit margin of the coal trading business to be 1%-2% and the volume of the LOI order, it expected a positive impact on its earnings per share and net assets per share for the financial year ending June 30, 2012.

The estimated profit sharing arrangement between Sanichi and FIRC Trade Sdn Bhd was 30% for Sanichi and 70% for FIRC.



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Market Commentary

The FBM KLCI index gained 0.99 points or 0.07% on Thursday. The Finance Index increased 0.14% to 13078.38 points, the Properties Index up 0.71% to 957.45 points and the Plantation Index rose 0.11% to 7906.09 points. The market traded within a range of 15.98 points between an intra-day high of 1464.52 and a low of 1448.54 during the session.

Actively traded stocks include JCY-CD, MBSB-CA, JCY, KULIM-CB, SANICHI, KFC-CB, FLONIC, AFFIN-CE, PROTON-CH and BIMB-CB. Trading volume increased to 1564.71 mil shares worth RM1251.16 mil as compared to Wednesday’s 1494.84 mil shares worth RM1084.68 mil.

Leading Movers were CIMB (+7 sen to RM6.92), UMW (+34 sen to RM6.84), IOICORP (+6 sen to RM5.15), AXIATA (+3 sen to RM4.90) and MAXIS (+4 sen to RM5.49). Lagging Movers were KLK (-48 sen to RM22.12), DIGI (-4 sen to RM3.62), GENTING (-8 sen to RM10.34), MISC (-8 sen to RM5.39) and GAM (-6 sen to RM3.03). Market breadth was negative with 346 gainers as compared to 380 losers. -- JF Apex Securities Bhd



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KL shares lower at mid-afternoon

Share prices on Bursa Malaysia were lower at mid-afternoon today, led by consumer and plantation counters, dealers said.

At 3pm, the FTSE Bursa Malaysia KLCI lost 0.84 point, or 0.06 per cent, to 1,464.55 on a lack of market-moving factors.

The overall market sentiment was weak with losers outpacing gainers by 347 to 254 counters with 294 unchanged and 589 others untraded. Turnover stood at 946.9 billion shares worth RM560.21 million.

The Finance Index rose 35.01 points to 13,042.62, Plantation Index lost 62.29 points to 7,923.09 and the Industrial Index declined 2.99 points to 2,649.45.

The FBM Emas Index decreased 4.88 points to 10,034.59, FBM Mid 70 Index rose 2.141 points to 11,005.2 and the FBM Ace Index increased 7.25 points to 4,148.52.

For the actives, Takaso gained 1.5 sen to 21 sen and BIMB-CB rose one sen to 10 sen. Sanichi, however, fell half sen to 22.5 sen.

Among heavyweights, Maybank gained six sen to RM8.25 and CIMB rose one sen to RM6.86. Sime Darby was flat at RM8.94 despite news that its industrial division bought a portion of the former Bucyrus distribution business for RM1.1 billion. -- Bernama



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FBM KLCI up 0.4 point at midday

Share prices on Bursa Malaysia were mixed at the end of the morning session today, amid the bearish sentiment on key regional markets, dealers said.

At 12.30pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 0.4 of a point or 0.03 per cent to 1,465.79.

Dealers said plantation stocks continued to drag the benchmark index down as palm oil stocks declined by 1.52 per cent to 2.068 million tonnes in November.

HwangDBS Vickers expects the index to continue to swing sideways with a marginal downward bias due a dearth of positive developments abroad.

Investors were disappointed when US policymakers did not mention fresh measures to stimulate the American economy at the Federal Open Market Committee meeting last night.

In reaction, major stock indices on Wall Street lost between 0.6 per cent and 1.3 per cent at the closing bell, the research house said.

The Finance Index rose 32.109 points to 13,039.72 but the Plantation Index tumbled 55.38 points to 7,930 and the Industrial Index fell 5.14 points to 2,467.3.

The FBM Emas Index gained 1.37 points to 10,040.84, the FBM Mid 70 Index lost 1.479 points to 11,001.58 and the FBM ACE Index advanced 7.43 points to 4,148.7.

Market breadth was negative, with losers leading gainers by 320 to 232, while 293 counters were unchanged. Turnover stood at 808.93 lots worth RM455.72 million.

For the actives, Takaso gained 2.0 sen to 21.5 sen, BIMB-CB rose 1.0 sen to 10 sen but Sanichi fell half sen to 22.5 sen.

Among heavyweights, Maybank gained 6.0 sen to RM8.25, Sime Darby was flat at RM8.94 and CIMB rose 2.0 sen to RM6.86. -- Bernama



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KL shares remain mixed at mid-morning

Share prices on Bursa Malaysia remained mixed at midmorning today with buying interest seen in heavyweights and call warrant counters, dealers said.

At 11am, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 0.1 point or 0.007 per cent to 1,465.49.

The Finance Index rose 31.989 points to 13,039.6 but the Plantation Index tumbled 59.28 points to 7,926.1 and the Industrial Index fell 1.44 points to 2,651.

The FBM Emas Index gained 2.57 points to 10,042.04, the FBM Mid 70 Index added 13.65 points to 11,016.71 and the FBM ACE Index advanced 11.35 points to 4,152.62.

Market breadth turned negative, with losers leading gainers by 227 to 216, while 257 counters were unchanged. Turnover stood at 517.63 lots worth RM259.6 million.

For the actives, BIMB-CB rose 1.0 sen to 10 sen, Sanichi fell 0.5 sen to 22.5 sen and Envair added 5.0 sen to 37 sen.

Among heavyweights, Maybank gained 7.0 sen to RM8.26, Sime Darby was flat at RM8.94 and CIMB rose 3.0 sen to RM6.87.

Meanwhile, counters of three companies, KFC Holdings, QSR Brands and Kulim, were suspended today at their request. This follows Johor Corp's plans to take QSR Brands private. The takeover deal may also involve Kulim, a unit Johor Corp which controls
QSR Brands, and in turn owns KFC Holdings (Malaysia) Bhd.

Based on yesterday's closing, QSR's share price was RM6.00, with Kulim and KFC at RM3.69 and RM3.41, respectively. -- Bernama



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KL shares lower in early trade

Share prices on Bursa Malaysia were traded lower in the early session today in line with the weaker sentiment on key regional markets, dealers said.

Forty five minutes into the opening bell, the FTSE Bursa Malaysia KLCI (FBM
KLCI) fell 4.82 points or 0.33 per cent to 1,462.28. It had opened at 1,462.91.

The Finance Index declined 38.45 points to 12,968.66 but the Plantation
Index increased 6.27 points to 7,933.68 and the Industrial Index fell 2.54
points to 2,643.75.

The FBM Emas Index was down 25.689 points to 10,021.44, the FBM Mid 70 Index declined 3.891 points to 10,977.02 and the FBM ACE Index lost 11.47 points to 4,140.

Losers led gainers by 185 to 113 while 182 counters were unchanged. Turnover stood at 224.62 lots worth RM125.51 million.

For the actives, Proton-CG earned five sen to 39 sen, Sanichi added 1.5 sen
to 19 sen and Proton-Ci gained eight sen to 53.5 sen.

Among heavyweights, Maybank fell one sen to RM8.15, Sime Darby gained three sen to RM8.95 and CIMB lost nine sen to RM6.86. -- Bernama



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FBM KLCI continues uptrend at mid-afternoon

Share prices on Bursa Malaysia continued the positive momentum at midafternoon today with continued gains seen in selected bluechips, dealers said.

At 2.58 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) was up 10 points to 1,470.13, after opening 3.6 points higher at 1,463.73.

A dealer said the uptrend on the local bourse was in line with key regional markets, following last Friday's firmer close on Wall Street as well as positive sentiment from the European region.

Risk appetite also improved on fresh optimism that the eurozone debt crisis could be contained after the pact reached by the European countries for deeper economic integration and a proposal to increase the rescue fund's size.

The Finance Index rose 111.21 points to 13,052.10 and the Plantation Index jumped 60.74 points to 7,921.43 while the Industrial Index added 8.32 points to 2,658.28. The FTSE Bursa Malaysia Emas Index increased 67.26 points to 10,066.81, the Ace Index gained 6.65 points to 4,181.10 and the Mid 70 Index went up 72.50 points to 10,988.21.

Gainers led losers 352 to 274 while 304 counters were unchanged with 547 untraded and 18 others suspended. Trading volume stood at 1.02 billion shares valued at RM586.2 million.

For the actives, 1 Utopia Bhd-WA was unchanged at 5.0 sen, 1 Utopia Bhd rose 0.5 sen to 12 sen, Proton Holding - CG went up 6.0 sen to 37 sen and Sanichi decreased 2.5 sen to 18 sen.

Among heavyweights, Maybank added 3.0 sen to RM8.18, CIMB rose 10 sen to RM6.99, Sime Darby climbed 2.0 sen to RM8.92, Petronas Chemicals increased 8.0 sen to RM6.08 and Tenaga Nasional Bhd gained 2.0 sen to RM5.55. -- Bernama



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Sanichi secures coal supply deal

PETALING JAYA: ACE Market-listed Sanichi Technology Bhd has secured a coal supply commitment and collaboration agreement from Kalimantan-based CV Permata Al Zahra for the supply of three million tonnes of coal per annum for a two-year term from Tuesday.

Permata is involved in coal mining and the supply of coal products. Sanichi has committed to undertaking business development activities to market and distribute coal supplied by Permata.

On a separate announcement, Sanichi said it had agreed with FIRC Trade (M) Sdn Bhd to enter into a collaboration framework agreement for the purpose of forming an alliance to venture into the business of minerals mining and supply.

FIRC is principally involved in mining, trading and supply of iron ore and coal from mines in Malaysia and Indonesia.

Under this agreement, both Sanichi and FIRC shall carry out marketing, development, project bidding and project management, together with cost and profit sharing.

The agreement underlines that FIRC will provide technical expertise and dedicated engineering support to Sanichi to cater to customers’ needs and requirements. On the other hand, Sanichi will handle marketing and business development.

The contracts could kick in by early January next year and are slated for a minimum period of five years.



According to Sanichi, the pipeline of opportunities available to the alliance is significant. However, it said that it was not in the position to make a clear assessment of the potential impact on Sanichi’s earnings per share, net assets per share and gearing for the financial year ending June 30, 2012, given the early stage of the pipeline.

Sanichi’s share price has been actively traded in recent months since the entry of Datuk Md Wira Dani Abdul Daim, son of former finance minister Tun Daim Zainuddin, as a new substantial shareholder with a 6.01% stake on Aug 3 this year.

Since then, the stock has been traded heavily; it started ascending on Nov 4, with 88.5 million shares traded in the open market, pushing the stock price up by 70% to 8.5 sen.

A month later on Dec 5, Sanichi was again heavily traded with 119.5 million shares changing hands in a single trading day, which sent its share price to end at 20 sen, an increase of 73% over the previous week’s closing.

On the same day, Bursa Malaysia issued an unusual market activity query to Sanichi, to which the company replied that it was not aware of any developments relating to its subsidiaries.

The stock again saw heavy trading yesterday with 77.7 million changing hands in the open market, sending its price to a year-to-date high of 20.5 sen, an increase of 3.5 sen or 20.6% over Tuesday’s closing price of 17 sen. The stock was suspended by Bursa Malaysia with effect from 3.25 pm yesterday, and trading is to resume today.


This article appeared in The Edge Financial Daily, December 8, 2011.




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KL shares still in the red at midday

Share prices on Bursa Malaysia continued to lose grounds at midday today as the market remained under pressure on external developments.

At 12.30pm, the FBM KLCI was down 10.10 points at 1,472.89, after opening 5.24 points lower at 1,477.75.

Dealers said investors were cautious ahead of a European Union summit this week. Economic data from Japan and Australia that indicated the global economy is slowing also weighed on the local equity market.

The Finance Index dipped 125.78 points to 13,107.37, the Industrial Index slipped 7.39 points to 2,673.03 and the Plantation Index dropped 49.88 points to 7,832.94. The FBM Emas Index lost 59.25 points to 10,085.62, the FBM 70 Index declined 35.03 points to 10,997.26 and the FBM Ace Index was down by 46.98 points to 4,214.26.

Decliners led advancers by 364 to 216 while 275 counters were unchanged, 631 untraded and 25 others suspended. Trading was moderate with a total volume of 895.838 million shares worth RM498.921 million.

Among active stocks, SAAG Consolidated earned 0.5 sen to 7.0 sen, Sycal Ven-WA added 3.5 sen to 13 sen and DVM Technology inched up 1.0 sen to 10 sen.

Sanichi Technology was suspended pending a reply to queries and further clarification on the details of the two announcements made by the company yesterday. British American Tobacco lost 34 sen to RM47.66, JT International eased 25 sen to RM6.55, while Kuala Lumpur Kepong erased 22 sen to RM21.94

Of the heavyweights, Maybank dropped 9.0 sen to RM8.21, Sime darby was flat at RM8.94, CIMB fell 15 sen to RM7.05 while Petronas Chemicals edged up 1.0 sen to RM6.09. -- Bernama



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Automotive-based Sanichi plunges into energy sector

KUALA LUMPUR: Sanichi Technology Bhd, a mould maker for the automotive sector, has made its first venture into the energy sector by securing a two-year contract to supply three million tonnes of coal a year to China.

Johor-based Sanichi also formed a joint venture agreement with coal trader FiRC Trade (Malaysia) Sdn Bhd to sell steam coal in China.

Sanichi managing director Datuk Dr Jacky Pang said this venture will be the company's new business division and will bring it to a higher level in the future.

"Prospects are good because there is an overdemand situation for coal globally," he told reporters here at the company's KL office yesterday.

The steam coal will be supplied by Indonesia's coal miner CV Permata Al Zahra, which had signed an order supply commitment with Sanichi.

Sanichi has committed to undertake business development activities to market and distribute the coal supplied by Permata together with FiRC.

Sanichi and FiRC have agreed to a 50:50 profit-sharing ratio from the trading business.

"We will start supplying coal in January next year and it will impact positively to the company's future earnings and growth," said Pang.

However, he said the company is not in a position to make a clear assessment of the potential impact on Sanichi's earnings per share, net assets per share and gearing for the financial year ending June 30 2012.

Pang said China uses 2.5 billion tonnes of steam coal a year, of which 35 per cent Indonesia supplies followed by countries like South Africa, Australia and Mongolia.

Sanichi, which is listed on the ACE market, will fund the activities through internally-generated funds.

Pang said it will approach Tenaga Nasional to buy its coal and may also own mine in Indonesia.



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Stocks to watch MAS, Toyo Ink, Sanichi, BHIC

KUALA LUMPUR (Dec 8): Gains at the FBM KLCI on Thursday could be capped by cautious sentiment ahead of a crucial European Union leaders’ summit later this week, as pressure mounts on policymakers there to thrash out a definitive plan to salvage the region from a deeper debt crisis.

European shares turned briefly negative on Wednesday after downbeat comments from a German politician about the chances for a comprehensive deal at a leaders' summit this week, aimed at resolving the region's debt crisis, according to Reuters.

Regional markets, including at Bursa Malaysia, had closed higher on Wednesday after the Financial Times reported that European leaders would discuss boosting the firepower of the euro zone bailout fund.

On Bursa Malaysia, among the stocks that could be in focus today are MALAYSIAN AIRLINE SYSTEM BHD [], TOYO INK GROUP BHD [], SANICHI TECHNOLOGY BHD [] and BOUSTEAD HEAVY INDUSTRIES CORPORATION BHD.

MAS aims to fly back into the black by 2013 on the back of an aggressive capacity cut, which is possibly the largest in the airline’s history.

The airline said it would reduce 12% of its capacity and cut unprofitable routes over the next one year, a move that it said would save it some RM300 million, which accounts for over 20% of the RM1.18 billion to RM1.51 billion in cost savings and additional income it aims to achieve under its turnaround plan unveiled yesterday.

MAS also confirmed the launch of a new regional premium airline, which will serve mainly Asian routes, by the middle of next year.

However, the airline will remain in the red this year after posting a RM1.25 billion loss for the first nine months.

Toyo Ink has been given the nod to commence research and development of the proposed US$2.5 billion Song Hau 2 Thermo Power Plant in Vietnam.

The company said on Wednesday that it had a letter from Vietnam's Ministry of Industry and Trade for it to start research and development of the plant with a capacity of 2 X 1000 MW at Song Hau Power Center, Hau Giang Province.

Sanichi, a precision-mould maker, is venturing into the minerals mining and supply business via a collaboration with FIRC Trade (Malaysia) Sdn Bhd. The latter is principally involved in the mining industry as contract owners and joint venture partners with several producing iron ore and coal mines in Malaysia and Indonesia.

Sanichi said under that the collaboration, FIRC would provide technical expertise and engineering support to Sanichi, while the group will co-brand with FIRC for the purposes of marketing and business development.

BHIC’s subsidiary BHIC AeroServices (BHICAS) Sdn Bhd was awarded the certification by Directorate General Technical Airworthiness of the Malaysian Armed Forces, which the Malaysian technical airworthiness authority.

The AMO certification is for the maintainance, repair & overhaul (MRO) of Eurocopter AS555SN Fennec helicopters, it said.

BHICAS is a joint venture between BHIC Defence Technologies Sdn Bhd, a wholly-owned subsidiary of Boustead Penang Shipyard Sdn Bhd, Prestige Pillar Sdn Bhd and Eurocopter Malaysia Sdn Bhd, a wholly-owned subsidiary of Eurocopter.



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Sanichi to venture into mineral mining, supply biz

KUALA LUMPUR (Dec 7): SANICHI TECHNOLOGY BHD [], a precision-mould maker, is venturing into the minerals mining and supply business via a collaboration with FIRC Trade (Malaysia) Sdn Bhd.

Sanichi said on Wednesday that FIRC was principally involved in the mining industry as contract owners and joint venture partners with several producing iron ore and coal mines in Malaysia and Indonesia.

It said FIRC was also involved in the trading and supply of various iron ore and coal products.

Sanichi said under that the collaboration, FIRC would provide technical expertise and engineering support to Sanichi, while the group will co-brand with FIRC for the purposes of marketing and business development.

It said the operations would commence by Jan 2, 2012 and will continue to be in force for a minimum period of five years.

Sanichi said it would finance the business activities of the alliance via internally generated funds.

It said the business was expected to contribute positively to its future earnings.

Meanwhile, Sanichi said it had also secured at least three million metric tonnes of coal supply a year from Indonesia's CV Permata Zahra.

In a separate filing on Wednesday, Sanichi said that under a collaboration agreement, it would market and distribute the coal supplied by Permata.

The contract is for a period of two years beginning Dec 6, it said.



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Sanichi Tech eyes pact with FIRC Trade

Sanichi Technology Bhd, a precision-moulds maker, plans to form an alliance with FIRC Trade (Malaysia) Sdn Bhd to venture into the business of minerals mining and supply, it said in a statement to the stock exchange today.

Sanichi has secured at least 3 million metric tons of coal supply a year from Indonesia’s CV. Permata Al Zahra, Sanichi said in a separate filing. The contract will last two years beginning Dec. 6, it said. -- Bloomberg



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