Envair hits 4-year high on ZAI stake buy

Envair Holding Bhd jumped to its highest in more than four years after saying ZAI Corporate Finance Ltd plans to buy as much as 30 percent of new shares in the Malaysian air pollution control systems provider.

The stock surged 10 percent to 42.5 sen at 9:04 a.m. local time in Kuala Lumpur, set for its highest close since May 2007. -- Bloomberg

Zelan climbs on getting award letter

Zelan Bhd, a Malaysian builder, rose to its highest level in almost three months after it received a letter of intent for RM300 million of subcontract works for a power plant project from Mudajaya Corp.

The stock climbed 8.5 percent to 38.5 sen at 9:09 a.m. local time, headed for its highest close since Aug. 1. The contract is subject to Mudajaya’s group being appointed as main contractor. -- Bloomberg

Zelan climbs on news it may get RM300m job

KUALA LUMPUR (Oct 31): Shares of loss-making ZELAN BHD [] rose on Monday on news that it has received a letter of intent from Mudajaya Corporation Bhd to undertake civil works valued at RM300 million for a power plant expansion in Johor.

At 9.35am, it was up 2.5 sen to 38 sen. There were 7.46 million shares done.

The FBM KLCI fell 0.78 of a point to 1,481.04. Turnover was 184.71 million shares valued at RM127.30 million. There were 188 gainers, 137 losers and 182 stocks unchanged.

Last Friday, Zelan said Mudajaya confirmed its intention to subcontract part of the civil works for the CONSTRUCTION [] of the 1,000 MW Tanjung Bin coal fired power plant in Johor.

However, this was subject to the consortium, comprising of Alstom, Mudajaya and Eversendai Corp Bhd, being appointed the main engineering, procurement and construction contractor (EPCC) by Malakoff Corporation Bhd for the power plant expansion.

In the first quarter ended June 30, 2011, it posted net losses of RM8.04 million on the back of RM12.80 million in revenue. As at June 30, the group’s current liabilities of the exceeded the current assets by RM206.42 million.

Envair up on proposed take-up of placement shares

KUALA LUMPUR (Oct 31): Shares of Envair Holdings Bhd rose in active trade on Monday after an investment banking firm based in London to subscribe for up to 30% of its new ordinary shares.

At 9.21am, it was up four sen to 42.5 sen. There were 5.90 million shares done.

The FBM KLCI was up 2.32 points to 1,484.14. Turnover was 130.45 million shares valued at RM85.91 million. There were 185 gainers, 80 losers and 154 stocks unchanged.

The ACE Market-listed company received a letter from Envair has received a letter of intent from Zai Corporate Finance Ltd (ZAICF), to subscribe for up to 30% of its new ordinary shares of 10 sen each at the market issue price.

Tenaga down after 4Q losses, OSK trims earnings

KUALA LUMPUR (Oct 31): Shares of TENAGA NASIONAL BHD [] fell on Monday after it announced fourth quarter net loss of RM453.90 million, the second consecutive quarter of losses while OSK Research trimmed its earnings forecasts by 8% and 7% for FY12 and FY13 accordingly.

At 9.08am, Tenaga was down 10 sen to RM5.76. There were 317,900 shares done.

The FBM KLCI rose 1.47 points to 1,483.29. Turnover was 71.11 million shares valued at RM47.61 million. There were 149 gainers, 40 losers and 128 stocks unchanged.

Last Friday, Tenaga reported that at the operating level, the power company reported operating losses of RM248.80 million due to higher fuel costs of coal and utilisation of oil and distillates after the gas curtailment by Petroliam Nasional Bhd.

For the full year ended Aug 31, 2011, its net profit plunged 84.3% to RM499.50 million from RM3.20 billion in FY10. Revenue was 6.2% higher at RM32.20 billion compared with RM30.32 billion.

OSK Research said Tenaga’s results were within its expectations although below consensus. This was because the utility company had to generate electricity from expensive oil and distillates as it continued to be plagued by gas supply problems.

“Going forward, Tenaga only expects this issue to be resolved in mid-2012 when the Melaka LNG plant is completed. For now, it is seeking compensation from Petronas for the additional fuel cost it has had to incur owing to the gas shortage.

“We trim our earnings forecasts by 8% and 7% for FY12 and FY13 accordingly. Our DCF based FV is intact at RM6.24 and we maintain our NEUTRAL call,” it said.

OSK Research maintains Overweight on O&G sector

KUALA LUMPUR (Oct 31): OSK Research is maintaining its overweight stance on the oil and gas sector and its top picks are Kencana (Buy, FV: RM3.17) and Dialog (Buy, FV: RM3.66).

It said on Monday, with an improving global economic outlook and crude oil price having gone back to around US$90/barrel, it believes that O&G activities will gradually pick up, which would then benefit all O&G service providers through better utilisation rates and higher sales/unit or services/hour rates.

“On the local front, we expect the industry to be in for more marginal oilfield developments as well as the increasing need for brownfield services to boost O&G production while waiting for the commencement of deepwater activities on a large scale after pre-development preparations are completed,” it said.

CIMB Research has technical sell on Faber Group

KUALA LUMPUR (Oct 31): CIMB Equities Research has a technical sell on Faber Group at RM1.78 at price-to-book value of 1.4 times.

It said on Monday, that since it featured Faber as a technical buy stock on Oct 12, prices rallied to a high of RM1.91 before consolidation took place.

“The run-up stopped near the 61.8% FR level. Friday’s bearish Marubozu pattern also indicates that the stock may have peaked in the immediate term.

“Indicators are showing signs of exhaustion. MACD histogram bars are losing pace while RSI has also hooked downward,” it said.

CIMB Research said sellers at the 200-day SMA need to be respected. Any rebound towards RM1.82-1.91 is an opportunity to take profit. Put a buy stop at RM1.95.

CIMB Research has technical buy on Perisai

KUALA LUMPUR (Oct 31): CIMB Equities Research has a technical buy on PERISAI PETROLEUM TEKNOLOGI [] at 64.5 sen at which it is trading at a FY12 price-to-earnings of 5.9 times and price-to-book value of 1.7 times.

It said on Monday, Perisai broke out of its triangle resistance last Friday and it believed this would be a prelude to more upside ahead.

“If we are right, the next upleg should lift prices towards 67 sen to 70 sen. The 200-day SMA is also a magnet for prices,” it said.

CIMB Research said the technical landscape is improving. MACD signal line has returned to the black while RSI is rising towards the upper band of the neutral zone.

“Risk takers may start to nibble now. However, always put a stop at below the 61.5 sen level. A fall below 57.5 sen would negate this bullish view,” it said.