Stocks to Watch Kencana, SapuraCrest, Oriental, KAF, BAT

KUALA LUMPUR (April 23): Malaysian stocks may see further weakness on Tuesday against less-optimistic fundamental and technical indicators. Analysts have a downside-bias perception on the FBM KLCI in anticipation that global economic data and Malaysia's pre-election sentiment could curb gains across the 30-stock benchmark.

Crucial global highlights this week include potential indications of further quantitative easing by US policymakers, and China's monetary policy, results from which will influence the direction of global financial markets.

The spotlight also falls on Europe after the Flash Purchasing Manager's Indexes for Europe indicated a quicker pace of economic decline for the region. These global updates have resulted in a sell-off across Asian stockmarkets.

The FBM KLCI fell 8.05 points to 1,583.8 on Monday.

Stocks to watch on Tuesday include KENCANA PETROLEUM BHD [], SAPURACREST PETROLEUM BHD [], ORIENTAL HOLDINGS BHD [], KAF-Seagroatt & Campbell Bhd, and BRITISH AMERICAN TOBACCO (M) [] Bhd (BAT).

Shares of Kencana and SapuraCrest rose on news that trading of both stocks will be suspended beginning May 2 to facilitate the capital repayment exercises by the oil and gas support service providers. The capital repayment is in conjunction with the merger of both firms under a new-listed entity, SapuraKencana Petroleum Bhd.

Diversified entity Oriental trades ex-dividend on Tuesday. The company — the portfolio of which includes automotive, property and PLANTATION []s — plans to reward shareholders with a single-tier interim dividend of 3% for the financial year ended Dec 31, 2011. The final lodgement day is this Thursday.

KAF's third quarter (3Q) net profit more than doubled from a year earlier, as the stockbroking firm registered higher non-operating gains, which mitigated the impact of lower revenue and higher operating expenses. In a statement to the exchange on Monday, KAF said net profit came to RM8.62 million in the quarter to Feb 29, 2012 versus RM4 million a year earlier. Revenue fell 15% to RM7.18 million from RM8.45 million.

BAT's net profit rose 9% to RM194.51 million in the first quarter ended March 31, 2012 from RM178.56 million a year earlier, helped by higher revenue and lower operating expenses. The company said revenue rose 5% to RM1.04 billion from RM992.15 million. The tobacco firm plans said it plans to reward shareholders with a first interim tax-exempt dividend of 65 sen a share for the current financial year ending Dec 31, 2012.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

Kencana, SapuraCrest rally ahead of trading suspension

KUALA LUMPUR (April 23) : Shares of KENCANA PETROLEUM BHD [] and SAPURACREST PETROLEUM BHD [] rose on news that trading of both stocks will be suspended beginning May 2 to facilitate the capital repayment exercises by the oil and gas support service providers.

The capital repayment is in conjunction with the merger of both firms under a new listed entity SapuraKencana Petroleum Bhd.

Kencana shares climbed as much as 4% or 13 sen to RM3.33, a record high since the company’s listing in December 2006. The stock traded lower at RM3.29 at lunch break with some 5.1 million shares changing hands.

SapuraCrest added as much as 3% or 14 sen to RM5.04 before settling lower at RM5 with 331,900 shares done.

In separate statements to the exchange on Monday, SapuraCrest and Kencana said the trading suspension will take place until the delisting of both firms from the exchange. The ex-date for the capital repayment falls on May 4 while the entitlement date is on May 8.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

Sapuracrest 4Q profit up 5% year-on-year

KUALA LUMPUR (March 30) : SAPURACREST PETROLEUM BHD []’s net profit rose 5% in the fourth quarter from a year earlier as lower operating expenses and foreign exchange gains mitigated the impact lower revenue during the period.

In a statement to the bourse on Friday, Sapuracrest said its net profit climbed to RM76.52 million from RM 72.67 million a year earlier while revenue was down 6% to RM560.43 million from RM596.34 million.

The oil and gas support services provider said higher contribution from its drilling operations had supported its bottom line during the quarter.

Sapuracrest’s cumulative full-year net profit rose 34% to RM310.23 million from RM231.45 million a year earlier although revenue fell 19% to RM2.56 billion from RM3.18 billion.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

KLCI breaches 1,590-level at mid-morning

KUALA LUMPUR (March30): the FBM KLCI trended higher at mid-morning on the final trading day of the first quarter of 2012, while regional markets drifted marginally lower on fears of global growth slowdown.

At 10am, the FBM KLCI was up 4.89 points to 1,590.33, lifted by select blue chips including KLK and Maybank.

Gainers led losers by 186 to 189, while 235 counters traded unchanged. Volume was 252.32 million shares valued at RM154.22 million.

Meanwhile, Asian shares steadied on Friday as investors eyed key events that could dictate market trends in coming months and as the first quarter drew to a close after a stellar performance from equities, according to Reuters.

Still, investor sentiment across asset classes is being undermined by fears of a potential growth slowdown, with European troubles back in focus and concerns about China, the world's second largest economy, it said.

At the regional markets, Japan;s Nikkei 225 shed 0.26% to 10,088.00, Hong Kong’s Hang Seng Index down 0.59% to 20,488.40, the Shanghai Composite Index dipped 0.40% to 2,261.15, Taiwan’s taiex fell 0.24% to 7,853.39, south Korea’s Kospi edged down 0.05% to 2,013.40, and Singapore’s Straits Times index fell 0.50% to 3,009.11.

BIMB Securities Research in a note March 30 said that from it was observing at the moment actual figures have to at least beat forecasts for investors to stay upbeat.

It said this was exactly the scenario Wall Street was facing as investors remain unimpressed despite the lower unemployment claims (but higher than forecast) and a 3% GDP growth for 4Q11.

“For this, the Dow Jones Industrial Average had a mixed session before edging marginally by 20 points to 13,146,” it said.

The research house said European bourses were sold down after S&P cautioned that Greece may have to undergo more restructuring.

“Asian stocks were also broadly lower from weaker European markets but the FBM KLCI was one of the handfuls ended the day on positive territory.

“The index was up 1.7 points to jump just above the immediate resistance of 1,585. We expect market to be lacklustre today amid some downside risks and lack of fresh leads with 1,580 as the immediate support level,” it said.

Among the gainers on Bursa Malaysia at mid-morning, KLK rose 38 sen to RM24.52, BAT 28 sen to RM56.80, Sapuracrest, Maybank, Carlsberg and United PLANTATION []s added eight sen each to RM4.88, RM8.88, RM10.28 and RM24.88 respectively, IOI Corp seven sen to RM5.34, while Cypark and Maxis adde six sen each to RM1.92 and RM6.06.

Carotech was the most actively traded counter with 46 million shares traded. The stock fell three sen to 2 sen.

Other actives included Key West, Winsun, SuperComnet, KBB, Trinity, IFCA MSC, Ariantec and TMS.

Decliners at mid-morning included GAB, Genting, Petronas Dagangan, PPB, Hong Leong Bank, HELP, Kluang, UMW, Harrisons and Tradewinds Plantations.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

KLCI edges higher in early trade

KUALA LIMPUR (March 30): The FBM KLCI trended higher in early trade on Friday, lifted by select blue chips including Petronas-linked stocks and index-linked PLANTATION [] counters.

At 9.05am, The FBM KLCI was up 4.17 points to 1,589.61.

Gainers led losers by 96 to 49, while 115 counters traded unchanged. Volume was 67.54 million share valued at RM23.14 million.

Among the gainers, BAT rose 28 sen to RM56.80, SapuraCrest 11 sen to RM4.91, Tradewinds nine sen to RM9.72, IOI Corp and PPB eight sen each to RM5.35 and RM16.88, Petronas gas six sen to RM16.80, while Petronas Chemicals, MMCCOrp, Maxis and Keck Seng added five sen each to RM6.73, RM2.85, RM6.05 and RM4.10 respectively.

Decliners included Dutch Lady, Utusan Malaysia, Genting, MMHE, Ewei, AFG, Astino, petronas Dagangan and Carotech.

Carotech was the most actively traded counter with 10.43 million shares done. The stosk fell two sen to 3 sen.

Other actives included Trinity, TMS, Ariantec, IFCA MSC, Caley, Nextnation and Winsun.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

SapuraCrest targets Brazil’s oil and gas sector with Seadrill

KUALA LUMPUR (March 22): SAPURACREST PETROLEUM BHD [] is looking to expand its operation in Brazil's oil and gas services industry via its joint venture with Seadrill Ltd, said its group's chief executive Datuk Shahril Shamsudin.

SapuraCrest, which is in a merger deal with KENCANA PETROLEUM BHD [], had on Thursday received its shareholders approval for a joint venture with Seadrill.

The JV agreement with Seadrill was in relation to the contract to charter and operate three units of pipe laying support vessels by Petroleo Brasileiro (Petrobras) worth US$1.4 billion.

Shahril said on Thursday that with the JV formalised, SapuraCrest would be looking to expand its operation in Brazil's oil and gas services industry, as the nation is investing a lot to make the country's oil and gas industry "as effective as we have here in Malaysia".

"We are looking forward for another bid in Brazil, together with the same partner," he told reporters after the EGM at Sapura's headquarters in Seri Kembangan.

Shahril said currently, the group has put in about RM5 billion of bids.

He expected the merger with Kencana would increase the group's capability and balance sheet capacity to take on more challenging jobs such as the development of marginal oil fields.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

Maybank IB Research maintains buy on SapuraCrest

KUALA LUMPUR (March 7): Maybank Investment Bank Research is maintaining a Buy on SAPURACREST PETROLEUM BHD [] at RM5.62 as it has upside potential.

It said on Wednesday the Petronas Carigali Sdn Bhd (PCSB) contract charter for the T-9 rig is earnings- neutral to SapCrest, for the daily charter rate (DCR) is relatively similar its previous contract with EMEPMI albeit for a shorter duration.

“With two more rig contracts set to expire by 1H12, we expect minimal difficulties in seeking contract extensions at decent rates owing to the greater number of drilling programmes planned for the next two years. Our RM5.62 TP excludes contributions from its 49% stake in FPSO Berantai. Incorporating this would lift our TP to RM5.94,” said Maybank Research.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

HDBSVR sees investors taking profit after Wall St fall

KUALA LUMPUR (March 7): HwangDBS Vickers Research said the overnight fall on Wall Street, where the key indices plunged between 1.4% and 1.6% at the closing bell, could provide the excuse of local investors to take profit on Wednesday.

Wall Street fell on fears that disagreements by some private bond holders might derail Greece’s debt-swap deal, which in turn could scuttle the bailout programme for the financially-ailing country.

“This will likely provide an excuse for investors to take profit on our local bourse today. Its benchmark FBM KLCI – after rebounding from an intra-day low of 1,580.51 yesterday – may test and break below the immediate support line of 1,580 ahead,” it said.

HDBSVR said that hoping to buck the weak market pattern on Wednesday are counters like: (a) Dijaya Corporation, which has proposed to acquire property assets privately owned by its major shareholder (for RM949 million) as well as to undertake a fund-raising exercise (comprising both rights issue and debt financing); (b) Tan Chong, after being appointed to be the contract assembler for Subaru passenger cars; and (c) SapuraCrest Petroleum, as it has been awarded an oil & gas contract worth RM162 million.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

Stocks to watch: SapuraCrest, Dijaya, HSL, Kimlun

KUALA LUMPUR (March 7): Stocks on Bursa Malaysia may slip on Wednesday in line with the cautious global and regional markets as worries about slower growth cast a pall of gloom over investors’ sentiment.

Key regional markets posted losses of between 0.63% and 2.16% as riskier assets bore the brunt of fears that the global growth outlook is darkening and that Greece may not be able to complete a major debt restructuring deal.

Reuters reported China's lowering of its economic growth target and data pointing to Europe possibly slipping back into recession have slowly eroded the optimism on global markets generated by the European Central Bank's huge injection of loans to banks since December.

On Bursa Malaysia, late buying helped the FBM KLCI extend its gains but whether it can be sustained on Wednesday remains to be seen due to external worries.

On Tuesday, the KLCI closed 0.69 of a point higher to 1,589.91. Turnover was 1.29 billion shares valued at RM1.73 billion. The broader market reflected the cautious sentiment, with 519 decliners to 257 advancers while 315 stocks were unchanged.

Among the stocks to watch on Wednesday are SAPURACREST PETROLEUM BHD [], DIJAYA CORPORATION BHD [], HOCK SENG LEE BHD [], Kimlun Corp Bhd and Malaysia Airports Holdings Bhd (MAHB).

SapuraCrest Petroleum secured a US$54 million contract from Petronas Carigali Sdn Bhd to provide a tender rig including a mobilisation fee.

The contract was for 12 months starting April 1 with an option to extend for another 12 months.

Dijaya resumes trading after a two-day suspension for a corporate exercise. Dijaya is acquiring 40 PROPERTIES [] owned by its single-largest shareholder Tan Sri Danny Tan for RM948.7 million.

The purchase will be funded with a cash portion of RM250 million and the balance via the issuance of redeemable convertible unsecured loan stock (RCULS), with a staggered conversion price range of RM1.30 to RM2.50 over a 10-year period.

Upon completion of the proposed amalgamation exercise, the land bank will increase to 870 acres and the gross development value will increase to RM37 billion.

Hock Seng Lee Bhd plans to undertake a mixed commercial and residential property project in Bandar Samariang, Kuching with an estimated gross development value of RM700 million.

Hock Seng Lee said the project would be on 275.5 acres of land which it was acquiring from Projek Bandar Samariang Sdn Bhd for RM25.54 million.

RHB Research Institute said it was less enthusiastic on CONSTRUCTION [] stocks as it believed their share price performance is likely to be muted over the next six to 12 months as the market begins to price in a higher risk premium for construction stocks ahead of the nation’s general election that will have to be held by March 2013.

However, the research house said Hock Seng Lee would be buoyed by: (1) Projects under Sarawak Corridor of Renewable Energy (SCORE); (2) Sustained high margins given limited competition from only a small pool of Sarawak-based Unit Pendaftaran Kontraktor Negeri Sarawak (UPK) registered contractors for most public jobs in Sarawak; (3) An outstanding construction orderbook of RM1.1 billion; and (4) An added downside protection to its share price by virtue of a strong balance sheet with a net cash of RM183.7 million or 31.5sen a share as at Dec 31, 2011.

“Indicative fair value is RM1.90 based on 12 times FY12/12 EPS, in line with our one-year forward target PER for the construction sector of 10-14 times,” RHB Research.

Kimlun’s estimated outstanding book order has increased to about RM1.50 billion after it secured a RM68.29 million housing project in Johor Baru.

Its unit Kimlun Sdn Bhd had accepted a letter of award from UNITED MALAYAN LAND BHD []’s subsidiary Dynasty View Sdn Bhd to construct apartments and ancillary buildings in Johor Baru.

Meanwhile, MAHB’s franked dividend of up to 14.14 sen per ordinary share less income tax of 25% amounting to RM116.64 million will go ex on April 9 and the entitlement date is April 12.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

SapuraCrest Petroleum secures US$54m contract from Petronas Carigali

KUALA LUMPUR (March 6): SAPURACREST PETROLEUM BHD [] has secured a US$54 million contract from Petronas Carigali Sdn Bhd to provide a tender rig including a mobilisation fee.

The company said on Tuesday the contract was for 12 months starting April 1 with an option to extend for another 12 months.

“The award of the contract will have no effect on the issued and paid-up capital of the company and is expected to contribute positively to the group earnings and net tangible assets for the financial year ending 2013,” it said.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

Weak start for Bursa Malaysia’s first IPO of 2012

KUALA LUMPUR (Feb 23): Bursa Malaysia’s first initial public offer (IPO) for 2012, Sentoria Group Bhd, got off to a weak start, with the share price ending the morning session below its reference price of 87 sen.

The weak debut also reflected the cautious local and key regional markets as investors feared high oil prices would slow down global economic growth and also the continuing Euro zone debt crisis saga.

At 12.30pm, the FBM KLCI was down 1.08 points to 1,559.44. Turnover was 937.15 million shares valued at RM811.77 million. Declining stocks beat advancers 515 to 206 while 293 counters were unchanged.

All the key regional markets fell, with the exception of Japan where the Nikkei 225 rose 0.13% to 9,566.42.

Hong Kong’s Hang Seng Index fell 0.98% to 21.337.50, Shanghai’s Composite Index lost 0.05% to 2,402.30, Taiwan’s Taiex 0.71% to 7,945.15 and South Korea’s Kospi 1.12% to 2,006.01 while Singapore’s Straits Times Index shed 0.97% to 2,966.66.

At Bursa Malaysia, property developer Sentoria fell eight sen to 79 sen in active trade, with 21.62 million shares done. Its reference price was 87 sen, which was the placement price while the price offered to the public was 85 sen.

CIMB fell seven sen to RM7.17, dragging the KLCI down 1.23 points while HL Bank lost 12 sen to RM11.72 and Maybank one sen to RM8.70. Public Bank rose four sen to RM13.72.

AirAsia shed seven sen also to RM3.58, pushing the index down by 0.45 of a point. GENTING BHD [] lost four sen to RM10.80.

Among the PLANTATION []s, IOI’s decline of five sen, dragged the index down by 0.76 of a point. Batu Kawan fell 20 sen to RM18.60 and KLK 16 sen to RM23.48.

Lafarge fell 17 sen to RM7.20 and Boustead 16 sen to RM5.38 while SapuraCrest gave up 12 sen to RM4.88.

However, Axiata managed to support the index by 1.8 points when it rose nine sen to RM5.10. Tenaga added eight sen RM6.19, nuding the index by 1.02 points. United Plantations was the top gainer, up 54 sen to RM23.96, Hartalega 26 sen to RM8.23 and Oriental 25 sen to RM6.03.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

SapuraCrest-Kencana merger is 'best deal'

The SapuraCrest-Kencana Petroleum RM11.85 billion merger and acquisition (M&A) deal has won the "Best Deal/Most Innovative Deal in Southeast Asia in 2011" award from the Alpha Southeast Asia magazine.

The Hong-Kong based investment magazine announced the winners here last week for its annual Deal and Solution Awards 2011.

In a statement today, it said the award was aimed at recognising the best and most innovative corporate-centric investments and commercial banking solutions in the Southeast Asia region.

It said the M&A demonstrated that strategy diversification and an enhanced balance sheet for the integrated oil and gas service was fundamental in winning the the most innovative deal in the region in 2011.

CIMB Investment Bank and Maybank Investment Bank were among the financial advisers for the deal. Both the banks and RHB Investment Bank were also among the honour call for "Best Equity/IPO Deal of the Year in Southeast Asia in 2011" for their capital fundraising efforts in offshore support vessel operator, Bumi Armada's US$888 million initial public offering.

The government of Malaysia also received a borrower/issuer award for "Best Islamic/Most Innovative Islamic Finance Deal in Southeast Asia in 2011".

Meanwhile, a full write-up including all the winners involved in the transactions and awards rationale for the year 2011 is available in the December/January issue of Alpha Southeast Asia magazine. -- Bernama



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

HDBSVR: Buying interest in Malaysian stocks to resume

KUALA LUMPUR (Feb 20): HwangDBS Vickers Research (HDBSVR) said buying interest in Malaysian stocks could resume on Monday due to better external sentiment.

“If so, then the benchmark FBM KLCI may pull away from its immediate support level of 1,555 ahead,” it said on Monday.

HDBSVR said although Wall Street saw mixed closings last Friday – ending between -0.3% and +0.4% – the futures markets were up on Monday morning. The DJIA March futures contract was trading at a 56-point premium to the spot rate at 8.15am Malaysian time, lifted by hopes that Greece is on track to receiving international financial aid.

In terms of share price actions, oil & gas counters may be in the limelight, including:

(a) Tanjung Offshore, which could be a merger & acquisition target according to a business weekly report;

(b) SapuraCrest Petroleum, after entering into a joint venture in relation to the building, CONSTRUCTION [] and operation of three pipe-laying support vessels pursuant to a previously secured contract to charter and operate the three vessels at a contract value of US$1.4 billion; and

(c) MMC Corporation, following its announcement that the listing of its subsidiary Gas Malaysia would be delayed from 1Q12 to 2Q12.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

LCI snaps two-day winning streak as select blue chips weigh

KUALA LUMPUR (Feb 15): The FBM KLCI snapped its two-day winning streak and closed lower on Wednesday, lagging its regional peers, weighed by losses at select blue chips.

The FBM KLCI fell 4.75 points to 1,561.30.

Gainers led losers by 433 to 385, while 346 counters traded unchanged. Volume was 2.31 billion shares valued at RM2.15 billion.

Meanwhile, regional markets rose on Wednesday as investors hoped Greece would deliver on a commitment to enact harsh reforms, while comments from China's central bank governor saying Beijing would continue to invest in euro zone government debt aided sentiment, according to Reuters.

Asian shares, including Shanghai, Hong Kong and Japan, also broke through key technical resistances, after Zhou Xiaochuan said Beijing remains confident in the euro and in the ability of euro zone members to solve their debt problems, it said.

The Shanghai Composite Index gained 0.94% to 2,366.70, Hong Kong’s Hang Seng Index added 2.14% to 21,365.23, Japan’s Nikkei 225 rose 2.30% to 9,260.34, Taiwan’s Taiex was up 1.54% to 8,005.24, South Korea’s Kospi added 1.13% to 2,025.32 while Singapore’s Straits Times Index added 0.81% to 3,011.68.

On Bursa Malaysia, Petronas Dagangan was the top loser and fell 56 sen to RM18.22; Hartalega lost 34 sen to RM7.92, Aeon 15 sen to RM7.70, Kossan and Carlsberg down 11 sen each to RM3.44 and RM9.45, Petronas Gas 10 sen to RM16.64, while Nestle, IGB, Hong Leong Bank and KLK fell eight sen each to RM55.40, RM2.67, RM11.62 and RM25.38 respectively.

Naim Indah Corp was the most actively traded counter with 268.3 million shares done. The stock rose four sen to 52 sen.

Other actives included TMS, Dataprep, Compugates, Tiger Synergy, Perisai, Emico, SAAG and KHSB.

Among the gainers, BAT added 70 sen to RM52.48, Amtek 27 sen to 50 sen, Kim Hin, SPB and Lafarge Malayan Cement up 16 sen each to RM1.44, RM3.74 and RM7.08 respectively, TSM 15 sen to RM1.47, while SapuraCrest added 12 sen to RM5.05.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

Sarawak gas finds to spur new investments

Oil and gas sector
Maintain overweight: Petroliam Nasional Bhd (Petronas) has made two new big gas discoveries offshore Sarawak with estimated recoverable reserves of almost four trillion standard cubic feet (TSCF), an estimated 4% of Malaysia’s current natural gas reserves of 14.8 billion barrels of oil equivalent. The gas finds were at the Kasawari and NC8SW fields in Block SK316 off Sarawak, through exploration wells Kasawari-1 and NC8SW-1. These are the latest wells drilled in Block SK316 which are part of Petronas’ strategy to intensify domestic exploration and prolong its reserves.

The Kasawari-1 well was drilled last November and gas was found in the carbonate reservoirs. The well, drilled to a depth of 3,196m, penetrated about 1,000m of gas column — the longest drilled section of gas column in the country. The well test produced 29 million standard cu ft per day of gas. Preliminary assessments conducted early this month indicate that the gas-in-place for the Kasawari field is over five TSCF, with an estimated recoverable hydrocarbon resource of just over three TSCF — which is one of the largest non-associated gas fields in Malaysia. The NC8SW-1 well, located about 17km south of Kasawari, was drilled last September to a total depth of 3,853m. Gas was found in a 440m column in similar carbonate reservoirs, which are estimated to have recoverable reserves of over 450 billion standard cu ft. Petronas said the NC8SW-1 well discovered potential oil play which requires further evaluation to determine its commercial viability.

While these new gas finds would need another three to five years of analysis and interpretation of seismic data before progressing to the initial development phase, they continue to fuel excitement for oil and gas investments in Sarawak, a major gas producer and exporter with the country’s only liquefied natural gas plant in Bintulu.

Over the next 12 months, we expect Shell’s massive enhanced oil recovery projects in the Baram Delta off Sarawak to gain prominence. These projects involve the Bokor, Bakau, Baram, Baronia, Betty, Fairley Baram, Siwa, Tukau and West Lutong oilfields.

But over the next six months, we expect fresh news from Petronas’ RM15 billion fast-tracked programme to develop gas reserves from a cluster of fields in the North Malay basin, off Peninsular Malaysia. This project is expected to commence production towards the end of 2013. Initial beneficiaries of the North Malay basin development will be fabricators such as Malaysian Marine and Heavy Engineering Holdings Bhd (MMHE), Kencana Petroleum Bhd, SapuraCrest Petroliam Bhd and Dialog Group Bhd. UMW’s oil and gas division, which provides oil country tubular goods and pipelines and rig services, and Wah Seong Corp Bhd for gas compression modules and pipe-coating services, could likewise benefit.

We remain excited about the sector given Petronas’ massive capital expenditure programme of RM300 billion over the next five years involving enhanced oil recovery, marginal fields and cluster/deepwater developments towards maintaining its oil and gas production. We remain “overweight” on the sector and retain our “buy” calls on MMHE, Bumi Armada Bhd, Dialog, SapuraCrest, Kencana Petroleum and Petronas Gas Bhd. — AmResearch, Feb 14


This article appeared in The Edge Financial Daily, February 15, 2012.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

KL shares lower at mid-afternoon

Finance and plantation-related counters contributed to the soft performance on Bursa Malaysia today with the FTSE Bursa Malaysia KLCI (FBM KLCI) easing 5.67 points to 1,560.38 as at 3.05pm, dealers said.

Hong Leong bank, Kuala Lumpur Kepong, IGB Corporation, United Plantations, IOI Corporation, Sime Darby and CIMB were among the stocks in losses.

Dealers said market players were cautious ahead of the release of the domestic economic growth data later today, contributing to the bearish performance against an improved market sentiment in the region.

Nevertheless, the market sentiment was more optimistic following a pledge from China to help resolve Europe's debt crisis. The Finance Index lost 51.66 points to 13,851.04, the Industrial Index declined 5.33 points to 2,906.77 and the Plantation Index decreased 20.31 points to 8,861.24.

The FBM Emas eased 30.29 points to 10,852.34, the FBM 70 Index dropped 5.21 points to 12,368.06 and the FBM Ace Index was 16.7 points lower at 4,687.3. Losers led gainers 395 to 329 while 353 counters were unchanged. Total volume was 1.392 billion shares worth RM1.099 billion.

Among active stocks, Dialog Group-WA rose 30.5 sen to 34.5 sen, Sapuracrest Petroleum and TSM Global each added 16 sen to RM5.09 and RM1.48 respectively.

Of the heavyweights, Maybank was unchanged at RM8.52, Sime Darby fell two sen to RM9.62, Petronas Chemicals slipped four sen to RM6.94 and CIMB slid one sen to RM7.30. -- Bernama



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

SapuraCrest-Kencana merger may list in Mar

The proposed listing of a combined SapuraCrest and Kencana Petroleum Bhd in Malaysia has been delayed to end-March or early April, a source told Reuters on Wednesday.

The planned merger of the Malaysian oil and gas services firms, the largest in the Malaysian oil and gas sector, was scheduled to list the combined entity by end-February, but has been delayed because the companies are awaiting court approval on certain aspects of the deal.

“We are still waiting for the high court to approve some outstanding processes for the merger to go ahead,” said the source, who could not be identified because he is not authorised to speak to the media. - Reuters



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

KLCI pares down losses at mid-day, broader market stays weak

KUALA LUMPUR (Feb 3): The FBM KLCI pared down some its losses at the mid-day break on Friday, in line with the limited losses at key regional markets.

The FBM KLCI was down 0.24 of a point to 1,536.85 at the mid-day break.

The broader market was weaker with losers leading gainers by 449 to 298, while 335 counters traded unchanged. Volume was 1.32 billion shares valued at RM1.03 billion.

The ringgit weakened 0.13% to 3.0224 versus the US dollar; crude palm oil futures for the third month delivery was flat at RM3,050 per tonne, crude oil added 14 cents a barrel to US$96.50 while gold fell US$3.20 an ounce to US$1,756.27.

Hong Kong and China shares were weaker at midday in thin Friday trade, but losses on the benchmark indexes were limited by chart support levels with investors cautious ahead of fresh U.S. employment data later in the day, according to Reuters.

At the regional markets, Japan’s Nikkei 225 was down 0.14% to 8,864.48, Hong Kong’s Hang Seng Index shed 0.10% to 20,719.20, the Shanghai Composite Index was down 0.07% to 2,310.87, South Korea’s Kospi fell 0.87% to 1,966.95, while Singapore’s Straits Times Index rose 0.80% to 2,924.35 and Taiwan’s Taiex added 0.16% to 7,664.83.

On Bursa Malaysia, KLK fell 56 sen to RM25.04, Dutch Lady was down 36 sen to RM25.24, DKSH 20 sen to RM1.91, SapuraCrest and Genting shed 18 sen each to RM5 and RM10.98, F&N 16 sen to RM17.66, PPB 12 sen to RM17.08, Kamdar 10.5 sen to 37.5 sen, Toyo Ink nine sen to RM1.60 an d APM eight sen to RM4.50.

Gainers this morning included United PLANTATION []s, Tradewinds, MalPac, GAB, TDM, Sime Darby, BLD Plantations, Delloyd, BAT and Petronas Gas, while the actives included Nicorp, Mah Sing, JCY, DBE Gurney, Compugates, DRB-Hicom and Maxbiz.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

FBM KLCI remains in negative territory at mid-morning

KUALA LUMPUR (Feb 3): The FBM KLCI remained in negative territory at mid-morning on Friday as losses at select blue chips on mild profit taking ahead of the extended weekend weighed on the index.

At 10am, the FBM KLCI fell 4.69 points to 1,532.40, weighed by losses including at Petronas Dagangan, KLK, Genting and Hong Leong Bank.

Losers led gainers by 337 to 175, while 285 counters traded unchanged. Volume was 583.87 million shares valued at RM349.53 million.

Asian shares and major currencies were stuck in ranges on Friday ahead of key U.S. jobs data, which will offer more clues over the state of the world's largest economy, while Greek debt restructuring talks dragged on, according to Reuters.

At the regional markets, Japan’s Nikkei shed 0.33% to 8,847.50, Hong Kong’s Hang Seng Index was down 0.18% to 20,703.00, the Shanghai Composite Index fell 0.30% to 2,305.53 and South Korea’s Kospi lost 0.76% to 1,969.27.

Meanwhile, Singapore’s Straits Times Index gained 0.53% to 2,916.32 and Taiwan’s Taiex added 0.02% to 7,654.22.

BIMB Securities Research in a note Friday said stocks ended mixed in Wall Street yesterday following drop in jobless claims and mixed earnings results.

The Dow Jones Industrial Average closed 0.09% lower while S&P 500 rose 0.11% and Nasdaq was higher by 0.4%, it said.

The good news in US also sent good sentiment in Europe as major European markets ended higher, it said, adding that the better than expected PMI in China also boosted major regional indices.

Back home, the FBM KLCI broke two resistance level at 1,530 and 1,535 to close at 1,537, it said.

“We may expect some profit taking activities today given the mixed results in US; and the local market may face a little uncertainty due to the long weekend.

“We shall see immediate support at 1,530 followed by 1,520 while resistance at 1,540 and 1,545,” it said.

On Bursa Malaysia, Petronas Dagangan fell 34 sen to RM18, KLK down 26 sen to RM25.34, PPB and DKSH lost 18 sen each to RM17.02 and RM1.93, Malayan Flour Mills 14 sen to RM4.51, Genting and SapuraCrest 10 sen each to RM11.06 and RM5.08, Hong Leong Bank eight sen to RM11.36 while Nadayu and AMMB fell six sen each to RM1.04 and RM5.82.

Gainers included BAT, Kretam, Ta Ann, Jaya Tiasa, TDM, BLD PLANTATION []s, Tradewinds, JCY, Shell and Gamuda, while the actives included Mah Sing, DBE Gurney, Mazbiz, JCY and DRB-Hicom.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.

Firm start for February, volume surges to 2.6 bn units

KUALA LUMPUR (Feb 2): Stocks on Bursa Malaysia closed on a firm note on Thursday, with the FBM KLCI advancing nearly 16 points, supported by gains in bigger capitalised stocks including Maybank, Public Bank, conglomerate Sime Darby and DiGi.

Trading volume was high with nearly 2.6 billion units transacted in a market which also saw active trade in smaller capitalised stocks. The broader market was firmer, with advancing counters beating decliners more than two to one.

At 5pm, the 30-stock KLCI was up 15.8 points to 1,537.09 and year-to-date, it is up 3.37%. Turnover was 2.58 billion shares valued at RM2.86 billion. There were 643 gainers, 286 losers and 298 counters unchanged.

Among the key regional markets, Hong Kong’s Hang Seng Index closed up 2% at 20,739.45. The China Enterprises Index of top mainland listings in Hong Kong ended up 2.93% at 11,583.47. The Shanghai Composite Index finished up 1.96% at 2,312.56.

Japan’s Nikkei 225 rose 0.76% to 8,876.82 while Taiwan’s Taiex added 1.37% to 7,652.46 but Singapore’s Straits Times Index reversed into the red in late trade, down 0.06% to 2,903.04.

Meanwhile, European shares hit a six-week high on Thursday adding to solid gains after global manufacturing data eased fears about the growth outlook, but with Greek debt talks unresolved, gains were limited.

OSK Research said it indeed the KLCI performs well over the next 15 days in line with a global rally, it would be forced to rethink our bearish view for 1H12.

“Instead, we may upgrade our call on the market to a NEUTRAL from the current Sell, and may well promote more cyclical sectors such as Oil & Gas and CONSTRUCTION [].

“While the market may subsequently turn south after a 1Q rally, still the flush of liquidity in the system may keep it resilient for most of the year. For now, we remain Defensive with Consumer stocks and other defensive mid-cap plays likely to outperform still in the short term,” it said.

Among the index-linked stocks, DiGi rose 14 sen to RM4.10, adding 2.58 points to the KLCI. Maybank added 14 sen to RM8.34, Public Bank 20 sen to RM13.74, pushing the index up by 2.48 points and 2.23 points. Sime Darby’s 14 sen gain to RM9.28 added nearly two points.

Hartalega was the top gainer, adding 41 sen to RM7.63, deemed a favourite among glove maker while among PLANTATION []s, United Plantations added 36 sen to RM20.70, SOP 29 sen to RM6.44 and PPB 26 sen to RM17.22.

Among oil and gas players, SapuraCrest jumped 32 sen to RM5.18 and Kencana 17 sen to RM3.29 ahead of the completion of their merger.

Among the decliners were Glenealy, down 15 sen to RM7.22 with 12,100 shares but the RM7.50 takeover price by Samling provided the support for the plantation stock which had run up earlier this week.

RHB Cap fell 14 sen to RM6.98, TDM 11 sen to RM4.57 and KLK 10 sen to RM25.60.



Get your T+10 interest FREE margin trading account NOW. Attractive brokerage for online trading. Contact Mr Ho at +603-5192 0808 or hoxian@sjsec.com.my for more details.