Saturday, 14 January 2012

Stocks to watch: Hiap Teck, Mitrajaya, Frontken, Can-One, Kian Joo

KUALA LUMPUR (Jan 14): Key regional markets including Bursa Malaysia are likely to start off the new week on Jan 16 on a cautious note as the eurozone crisis drags on.

The latest move by Standard & Poor's to downgrade the long-term ratings on nine eurozone sovereigns will weigh on market sentiment.

S&P stripped France of its top AAA rating and downgraded of half the nations in the euro zone, which Reuters reported might complicate European efforts to solve a two-year old debt crisis.

“In our view, the policy initiatives taken by European policymakers in recent weeks may be insufficient to fully address ongoing systemic stresses in the eurozone,” said S&P.

On Wall Street, stocks dropped on Friday, snapping a four-day winning streak on the downgrade.

The Dow Jones industrial average fell 48.96 points, or 0.39%, to 12,422.06 at the close. The Standard & Poor's 500 Index lost 6.41 points, or 0.49%, to 1,289.09. The Nasdaq Composite Index fell 14.03 points, or 0.51%, to 2,710.67.

For the week, the DJIA rose 0.5%, while the S&P 500 advanced 0.9%, and the Nasdaq gained 1.4%.

Reuters reported that investors will look to earnings next week for insight on how the euro zone's debt woes may affect profits.

At Bursa Malaysia, stocks which could see trading interest are HIAP TECK VENTURE BHD [], MITRAJAYA HOLDINGS BHD [], FRONTKEN CORPORATION BHD [], CAN-ONE BHD [] and KIAN JOO CAN FACTORY BHD [].

Meanwhile, The Edge weekly reports in its latest edition that the Genting group's partnership with the state of New York - in a proposed US$4 billion development that would house the largest convention centre in the US - would give it an edge when it comes time to bid for a full-fledged casino licence.

Snack and confectionery manufacturer Cocoaland’s earnings recovered last year, whether the company can sustain its performance in the current financial year will depend on its ability to pass on the additional costs incurred in production to customers.

Hiap Teck Venture’s additional 354.14 million new shares under its rights issue with the 88.53 million warrants will be listed on Monday.

Mitrajaya’s unit has secured two contracts worth a total RM33.41 million from Putrajaya Holdings Sdn Bhd for CONSTRUCTION [] jobs in Putrajaya. Pembinaan Mitrajaya Sdn Bhd was awarded contracts to build houses and shop offices in Precints 11 and 8 in Putrajaya.

Frontken executive chairman and managing director Wong Hua Choon has disposed of his whole stake of 59.50 million shares or 5.8% stake.

Wong sold all the shares at 12 sen in two blocks to its German shareholder Jorg Helmut Hohnloser on Friday. Its net asset per share was 21 sen. Hognloser’s shareholding increased to 28.8% or 290.99 million shares after he acquired the shares.

Can-One and Kian Joo would continue to see trading interest on market expectations that Can-One would likely launch a general offer for KJCH after securing the 32.9% block.



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Friday, 13 January 2012

Axiata eyes non-mobile operations to boost revenue

KUALA LUMPUR (Jan 13): Axiata Group Bhd is allocating RM4.2 billion as capital expenditure for this year, as it looks into various ways to increase revenue, especially in the non-mobile operations.

"We are looking at areas that can increase revenue, especially content, entertainment, mobile commerce and mobile payment," said its president and group chief executive officer, Datuk Seri Jamaludin Ibrahim.

He said to achieve the objective; Axiata has planned for RM4.2 billion as capex for this year.

"It is more or less the same as last year, but the exact amount will be announced next month," he told a press conference after the launch of the Axiata Young Talent Programme on Friday.

On Axiata's key performance index (KPI) for this year, Jamaludin said it, together with revenue and the company's 2011 financial results, would be announced at the end of next month. The group revenue for 2010 was RM15.6 billion.

Axiata has a controlling interest in mobile operators in Malaysia, Indonesia, Sri Lanka, Bangladesh and Cambodia, with significant strategic stakes in India and Singapore.

In addition, it has a stake in non-mobile telecommunication operations in Thailand.

The group's mobile subsidiaries and associates operate under the brand name Celcom in Malaysia, XL in Indonesia, Dialog in Sri Lanka, Robi in Bangladesh, Hello in Cambodia, Idea in India and M1 in Singapore.

On the Axiata Young Talent Programme, Jamaludin said the group is investing RM100 million over 10 years in it to foster education and talent development in Malaysia.

He said Axiata is working with its subsidiaries and associates to replicate the programme and aims to launch it in 2014, starting with Indonesia.

The Axiata Young Talent Programme is also part of the 1Malaysia Programme targeted at the youth in the hopes of nurturing and developing them to become the future leaders and captains of industry. - Bernama



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LTAT sells 10m Guan Chong shares

KUALA LUMPUR (Jan 13): Lembaga Tabung Angkatan Tentera (LTAT) disposed of 10.27 million shares of GUAN CHONG BHD [] on Dec 30, 2011.

A filing with Bursa Malaysia showed that after the disposal of the 3.23% stake, the superannuation fund had ceased to be a substantial shareholder as its stake was reduced to 5.90 million shares or 1.85%.

Guan Chong manufactures cocoa-derived food ingredients such as cocoa mass, cocoa butter, cocoa cake and cocoa powder.

The share price closed at RM2.06 on Dec 30, but since then, the share price has been trending upwards and closed at RM2.38 on Friday.



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Mitrajaya unit gets RM33.41m contracts

KUALA LUMPUR (Jan 13): MITRAJAYA HOLDINGS BHD []’s unit has secured two contracts worth a total RM33.41 million from Putrajaya Holdings Sdn Bhd for CONSTRUCTION [] jobs in Putrajaya.

The company said on Friday that Pembinaan Mitrajaya Sdn Bhd had been awarded contracts to build houses and shop offices in Precints 11 and 8 in Putrajaya.

It said the first contract was to build 63 units of two storey terrace houses at Zone 10E, Precinct 11, Putrajaya for a contract sum of RM20.53 million.

It said the other contract was for the construction of 25 units of two storey shop office, 4 units three storey shop office and associated works at Precinct 8, Putrajaya for RM12.88 million.

Mitrajaya said both the contracts were to be completed within a period of 22 months from the date for possession of site.

“Both the contracts expected to contribute positively to Mitrajaya's future earnings,” it said.



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PM: Polls after economic reforms show results

KUALA LUMPUR (Jan 13): Prime Minister Datuk Seri Najib Tun Razak hopes that the general election will be "soon" but adds that the government still has to show that its economic reforms are producing real results before he is ready to go to the ballot box.

In an interview published by the Wall Street Journal on Friday, Najib said essentially "it's a call you have to make on the basis of a feel-good factor, and that's when you press the button. But of course at the end of the day it's a rather intuitive decision.

"You can have all the polling numbers but you must have the sense that this is the right time. I hope it will be the right time soon enough, but we still have to deliver on our promises and it's important for people to have the feeling that the reforms we have promised will actually benefit them."

In the interview, Najib was reported to have acknowledged that the deteriorating global economic environment, especially the persistent debt crisis in Europe, could complicate his decision about when to call for an election.

The report said that a worsening economic outlook could encourage Najib to call an election sooner than planned.

"But so far we are still quite comfortable because our exposure to the EU in terms of total trade is only about 9.0 per cent, so we are less vulnerable," he said.

"But a euro-zone collapse or some other catastrophe there will affect the whole world."

The last general election was held on March 8, 2008 and the current term only ends in March 2013.

Najib also said that both the government and opposition camps would step up their race to claim the centre-ground of Malaysian politics in the coming months.

Referring to the acquittal verdict on opposition leader Datuk Seri Anwar Ibrahim, he said once it was released, "all of the tension surrounding the trial suddenly fell away and people suddenly realised there are more important things than just the Anwar issue."

"What is important now is that we move forward," he said, and cited measures like making elections more transparent ahead of the next polls. - Bernama



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Market Commentary

The FBM KLCI index lost 2.49 points or 0.16% on Friday. The Finance Index fell 0.05% to 13451.67 points, the Properties Index up 0.16% to 1004.38 points and the Plantation Index down 0.40% to 8505.98 points. The market traded within a range of 4.33 points between an intra-day high of 1526.27 and a low of 1521.94 during the session.

Actively traded stocks include COMPUGT, DRBHCOM-CF, DRBHCOM-CI, DRBHCOM-CG, UTOPIA, PROTON-CL, ASIABIO, DRBHCOM-CH, AT and TAKASO. Trading volume increased to 1766.31 mil shares worth RM1608.93 mil as compared to Thursday’s 1515.08 mil shares worth RM1579.76 mil.

Leading Movers were GENM (+3 sen to RM3.88), MMCCORP (+7 sen to RM2.80), MAYBANK (+1 sen to RM8.26), HLBANK (+6 sen to RM10.88) and PETCHEM (+1 sen to RM6.46). Lagging Movers were IOICORP (-6 sen to RM5.43), GENTING (-8 sen to RM10.88), CIMB (-3 sen to RM7.27), DIGI (-2 sen to RM3.90) and PBBANK (-2 sen to RM13.16). Market breadth was negative with 373 gainers as compared to 397 losers. -- JF Apex Securities Bhd



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KLCI snaps winning streak, but adds 8.94 points week-on-week

KUALA LUMPUR (Jan 13): The FBM KLCI snapped its four-day winning streak and fell on Friday as key regional markets ended the week on a mixed note.

European shares and the single currency rose on Friday after positive comments on the region's outlook from the European Central Bank and the success of Spain's bond auction, with attention focused on Italy's first debt sale of the year, according to Reuters.

The FBM KLCI closed 2.49 points lower at 1,523.07. Week-on-week, however, the index gained 8.94 points.

Losers edged gainers by 397 to 373, while 339 counters traded unchanged. Volume was 1.77 billion shares valued at RM1.61 billion.

Affin Investment Bank Bhd vice president and head of retail research Dr Nazri Khan said the FBM KLCI was likely to extend gains towards 1,550 level following a round of well-received debt auctions in Spain and Italy, expected monetary easing in China and huge liquidity on the domestic front.

“The fact that Italy and Spain sold a total of €22bn ($28bn) of sovereign debt at sharply reduced prices (with implied borrowing costs falling to lowest levels since March 2011) is a major surprise and suggest the European funding problem is gradually improving,” he said.

At the regional markets, Japan’s Nikkei 225 rose 1.36% to 8,500.02, Hong Kong’s Hang Seng Index added 0.57% to 19,204.42, South Korea’s Kospi gained 0.60% to 1,875.68 and Singapore’s Straits Times Index jumped 1.75% to 2,791.54.

Meanwhile, the Shanghai Composite Index fell 1.34% to 2,244.58 and Taiwan’s Taiex shed 0.07% to 7,181.54.

On Bursa Malaysia, Dutch Lady fell 32 sen to RM25.78, Far East down 30 sen to RM6.90, Proton 28 sen to RM5.18, Iretex 12 sen to RM1.05, Advanced Packaging 11 sen to RM1.19, while Aeon, CBIP, JT International and HLFG lost 10 sen each to RM7.35, RM4.75, RM7.08 and RM11.70 respectively.

Among the gainers, Malayan Flour Mills added 31 sen to RM7.86, Supermax 21 sen to RM4.55, Carlsberg and Nestle added 20 sen each to RM8.63 and RM56, Hartalega, MBM Resources and Parkson rose 17 sen each to RM6.57, RM3.47 and RM5.70 respectively, while Milux and Kian Joo added 15 sen to RM1.44 and RM2.16.

Compugates was the most actively traded counter with 101.3 million shares done. The stock added one sen to 7 sen.

Other actives included DRB-Hicom, Utopia and Proton.



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Frontken exec chairman sells all 5.8% stake to German shareholder

KUALA LUMPUR (Jan 13): FRONTKEN CORPORATION BHD [] executive chairman and managing director Wong Hua Choon has disposed of his entire stake in the company, comprising of 59.50 million shares or 5.8% stake.

Filings to Bursa Malaysia showed that Wong sold all the shares at 12 sen in two blocks to its German shareholder Jorg Helmut Hohnloser on Friday. Its net asset per share was 21 sen.

Hognloser’s shareholding increased to 28.8% or 290.99 million shares after he acquired the shares.

According to Frontken’s company website, Wong is the co-founder of and its subsidiaries. It said he has more than 20 years of experience in the business of surface TECHNOLOGY [], including setting up of research and development and engineering application in thermal coating processes.

Frontken provides surface metamorphosis engineering in Asean countries, which focuses on increasing the efficiency and extending the lifespan of machinery and equipment.

The group uses numerous thermal spray coating methods to improve the operations efficiency of various turnkey industries, including the oil and gas, petrochemical, power generation, semiconductor and electronics manufacturing sectors.

In the third quarter ended Sept 30, 2011, it posted net profit of RM65,000 compared with RM1.99 million a year ago. Its revenue was 36.9% higher at RM45.61 million compared with RM33.31 million a year ago.

For the nine-months ended Sept 30, 2011, it reported net profit of RM4.23 million, down 54.8% from RM9.37 million in the previous corresponding period. Revenue was 40% higher at RM146.39 million compared with RM104.56 million a year ago.

It had bank borrowings of RM47.76 million as at Sept 30, 2011 while it had trade receivables of RM67.86 million and cash and bank balances of RM21.40 million.



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