PwC : Irregularities in Xian Leng’s accounts

KUALA LUMPUR (April 5) : The special audit on XIAN LENG HOLDINGS BHD [] revealed financial irregularities in its fish farm development capital expenditure amounting to RM90.7 million of which a total of RM85.7 million was disbursed under "questionable circumstances".

In a statement to the exchange on Thursday, Xian Leng which undertakes commercial breeding of ornamental fish, said the auditor PricewaterhouseCoopers Advisory Services Sdn Bhd (PwC), had disclosed that there was lack of evidence that the RM85.7 million portion was paid to four contractors, as indicated in Xian Leng's records during financial years 2005 to 2008.

According to the audit findings, the cheque payments were authorised by on Xian Leng managing director Ng Huan Tong, while signatories to the cheques were two former board members: Chua Chong Seng and Lim Wan Hong.

Lim is the spouse of Ng, who had voluntarily resigned from his position last Tuesday as PwC finalised its investigation. Xian Leng said its board is deliberating on the next course of action, which may include lodging a police report.



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Favelle Favco clinches RM102 million worth of contracts

KUALA LUMPUR (April 5) : Crane builder FAVELLE FAVCO BHD [] has secured five contracts with a combined value of about RM102.1 million.

In a statement to the exchange on Thursday, Favelle Favco said the purchase orders received in March and April this year involve tower and offshore cranes for local and foreign clients. The cranes are due for delivery in 2012 and 2013, according to Favelle Favco.

The company said the jobs are expected to contribute positively to its earnings for the current financial year ending Dec 31, 2012 and beyond.

Favelle Favco shares added one sent to RM1.37 on Thursday.



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TDM: New specialist Hospital to be built in Batu Burok, T’ganu

KUALA LUMPUR (April 5): The Terengganu state government has approved the lease of land in Batu Burok to TDM BHD [] to build and operate a new 130-bed specialist hospital with all the facilities to serve the people in Kuala Terengganu.

In a statement Thursday, TDM Bhd chairman Datuk Roslan Awang Chik said that the new eight-storey hospital would replace the current Kuala Terengganu Specialist (KTS) hospital that was operating at or near maximum capacity.

Roslan said the hospital to be built on a 5.79-acre land would be the city’s flagship specialist hospital that will serve the approximately 338,000 people of Kuala Terengganu.

“Our aim is to provide the community with high quality yet affordable medical care,” he said.

He said CONSTRUCTION [] would commence immediately and completed within 24 months once the land owner, Tabung Amanah Warisan Negeri Terengganu signs the completed lease documents

Meanwhilel, TDM chief executive officer Badrul Hisham Mahari said that the hospital would provide more comprehensive healthcare facilities, accommodate more in-patients, operate more specialist clinics and other quality healthcare services.

He said the new hospital was planned to be equipped with 130-bed hospital, five operating theatres, 12-bedded intensive care unit (ICU) and a one and half storey car park with 281 parking bays.

The current KTS Hospital is equipped with 33 beds, two-bedded ICU and two operating theatres, accident and emergency services were provided, runs a diagnostic imaging department, a laboratory and a pharmacy, he said.

The current hospital also provides consultancy services on general surgery, obstetrics and gynaecology, orthopaedics and anaesthetics, he said.

Badrul Hisham said the hospital project would cost RM170.2 million, excluding the cost of the lease of the land and incidental fees.

“It will be financed by internally generated funds and / or bank borrowings, which the Board has yet to decide,” said Badrul Hisham.

He also said TDM’s healthcare division with an average growth of 12% in patients number since 2007, had recorded consecutive annual increase in revenue with an average of RM31million in which contributed an average of 7.0% annually to TDM’s profit before tax.



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Petronas: RAPID project progressing as scheduled

KUALA LUMPUR (April 5): Petroliam Nasional Bhd said its proposed proposed Refinery and Petrochemical Integrated Development (RAPID) project, to be located in Pengerang, Johor, is progressing as scheduled.

In a statement Thursday, the national oil company said RAPID’s proposed refinery would have a capacity of 300,000 barrels per standard day and will supply feedstock for RAPID’s petrochemical complex as well as produce gasoline and diesel that meet European specifications.

The RAPID project aims to capitalise on the growing need for specialty chemicals and to meet the demand for petroleum and commodity petrochemical products in the Asia Pacific region by 2016, it said.

Petronas said the project that was first announced by Prime Minister Datuk Seri Mohd Najib Razak on May 13 last year, had achieved several important milestones in the past few months.

It said that following the announcement, a detailed feasibility study on the proposed project was undertaken, and completed in October 2011.

“The project has since progressed to a Front-End Engineering Design (FEED) stage, while at the same time Petronas is finalising the selection of potential partners and licensors for the various facilities within the project.

“The site topographical survey and soil investigation work have been completed, while the Environmental Impact Assessment Study (EIA) is currently being performed,” it said.

Petronas said it recently signed a Heads of Agreement with BASF to jointly own, develop, construct and operate production facilities for specialty chemicals and plants for precursor materials within the RAPID complex.

These world-scale facilities will be undertaken on a 40:60 basis, it said.

Progress is also made in the various other technical and commercial aspects of the proposed project for PETRONAS to reach its final investment decision (FID) in the middle of 2013.

“Except for pre-FID works, no other contract has been tendered out or awarded, Petronas will begin pre-qualification exercise for various tender packages for the project in stages, the earliest of which is expected to be held in the third quarter of this year.

“On the human resource side, preparation is being made to ensure the availability of qualified and trained personnel to work at the various plants and facilities within the RAPID complex,” it said.

Petronas said RAPID’s implementation had the potential of turning Southern Johor into a new refining and petrochemical centre in Malaysia, complementing the existing complexes in the country’s eastern corridors.

“It will also create multiple economic spin-offs and a new generation of oil and petrochemical professionals that will drive the development of this sector further, in line with the government’s aspirations to turn Malaysia into a leading petroleum industry hub in the region,” it said.



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KLCI extends loss for second day running

KUALA LUMPUR (APRIL 50): The FBNM KLCI extended its losses for a second day running while most global markets either pared down their losses or reversed earlier retreats on bargain hunting activities.

The FBM KLCI closed 5.83 points lower at 1,593.44, paring down its losses from the earlier intra-day low of 1,591.85.

Losers edged gainers by 352 to 342, while 317 counters traded unchanged. Volume was 1.24 billion share valued at RM1.22 billion.

At the Asian markets, Chinese shares jumped 1.7% the biggest single-day rise since early February led by non-banking financials after Premier Wen Jiabao said the monopoly formed by the country's big banks needed to be broken to get money flowing to cash-starved private firms, according to Reuters.

Hong Kong shares ended a holiday-shortened week weaker on Thursday, dragged by the Chinese financial sector as investors took profit on the final trading day before a four-day holiday weekend and ahead of US jobs data on Friday, it said.

Meanwhile, European shares eked out modest gains on Thursday with investors looking for bargains after three weeks of losses but sentiment remained fragile after lower demand at a Spanish auction rekindled funding concerns for weaker euro zone countries, said Reuters.

At the regional markets, the Shanghai Composite Index rose 1.74% to 2,302.24, South Korea’s Kospi addd 0.50% to 2,028.77 and Singapore’s Straits Times Index xx

Meanwhile, Hong Kong’s Hang Seng Index lost 0.95% to 20,593.00, Japan’s Nikkei fell 0.53% to 9,767.61 and Taiwan’s Taiex fell 1.56% to 7,639.82.

ON Bursa Malaysia, BAT was the top loser and fell 60 sen to RM54.98, GAB lost 20 sen to RM13, Aeon Credit down 15 sen to RM8.74, Milux, F&N and Genting fell 12 sen each to RM1.28, RM18.88 and RM10.96 respectively, MAHB down 11 sen to RM5.76 while Amway fell 10 sen to RM9.80.

Takaful was the top gainer and added 48 sen to RM3.70, Tradewinds PLANTATION []s added 25 sen to RM5.19, Cepco up 24 sen to RM1.79, Tradewinds added 19 sen to RM9.79, Ta Ann 18 sen to RM6.38, Jaya Tiasa 17 sen to RM8.93, Inno 14 sen to RM1.64, Y&G 13 sen to 73 sen, while Shell and Sin Heng Chan added 12 sen each to RM10.30 and RM1.12.

Metronic was the most actively traded counter with 124,92 million shares done. The stock added 2.5 sen to 17,5 sen.

Other actives included Naim Indah Corp, Ariantec, Focus, Carotech, SupertComNet, Ingenuity Solutions, JCY and Key West.



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CIMB-Principal Asset Management launches new fund

KUALA LUMPUR (April 5): CIMB-Principal Asset Management Bhd (CIMB-Principal) has launched its CIMB-Principal Strategic Income Bond Fund 2, a close-ended fund that will invest in both local and foreign bonds to take advantage of the high demand for bonds, predominately Asian bonds, due to continuing low interest rates in the US and Europe.

In a statement on Thursday, CIMB-Principal Asset Management chief executive Campbell Tupling said 2011 has proven to be a bumpy year for equity markets, causing investors to resort to safe haven assets as worries about the European sovereign debt crisis continue.

"However, bonds have weathered the recent market gyrations more successfully and have been more resilient than the equity market.

"In comparison to developed markets, the Asian region looks set to continue growing with sustained domestic demand and improving sovereign credit," said Tupling.

He said this sustained demand meant there would be strong support for Asian bond prices in the future.

"In Asia, the fixed income market will remain positive with moderating inflation and improving sovereign credit. Compared with the developed markets in Europe, the US and Japan, gross government debt in Asia as a percentage of GDP [gross domestic product] is significantly lower.

"Combined with positive outlook for Asian corporates which includes strong balance sheets, large cash holdings and modest leverage, Asia's governments look set to better develop their bond markets and thus fund its economic growth. This positive outlook will provide an opportunity for investors to leverage on the good credit ratings and healthy growth drivers," he said.

Tupling said that with balance sheets of most Asian economies expected to remain strong, there was an insurgence of investors tilting towards Asia as compared to developed economies.

China, for example, remains the major driver of the growth in Asia as the number one export destination for regional countries with a GDP growth estimation of 8.7% in 2012, he said.

Meanwhile, he said Indonesia would remain as one of the most favoured economies in the region.

Having its sovereign ratings upgraded by Moody's and Fitch, confidence remains high for Indonesia and foreign investors are pouring in.

Malaysia on the other hand, will be lifted by Chinese commodity demand linked to their huge public infrastructure and investment projects, he said.

"Investors with a three-year investment goal will be able to benefit from the positive growth drivers mentioned earlier. This means investors can expect potential returns higher than that of cash deposits and regular income distribution, if any," Tupling said.

Tupling said the CIMB-Principal Strategic Income Bond Fund 2 would invest between 70% to 98% (both inclusive) of the Fund's net asset value (NAV) in a diversified portfolio of bonds and other fixed and floating rate securities issued by governments, government agencies, supranational organisations and corporate issuers.

The Fund may also invest in high-yield securities subject to a maximum of 40% of its NAV, he said.

With a minimum subscription of RM5,000, the Fund has an approved fund size of 150 million units priced at RM1.00 per unit.

The Fund is available for subscription from April 9 to May 23, and will be distributed by CIMB Bank, CIMB Private Banking, CIMB Investment-Retail Equities, CWA, Citibank and OCBC.



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MBSB to focus on retail business

KUALA LUMPUR (April 5): MALAYSIA BUILDING SOCIETY BHD [] (MBSB) is going to focus its business on the retail segment, according to its president and CEO, Datuk Ahmad Zaini.

He said a large component (of the retail business focus) will be personal financing and home mortgage programs, and very small auto financing,"

Ahmad Zaini said on Thursday that the focus would help MBSB achieve its 15% to 20% loans growth target, adding that this percentage growth should translate to about RM3 billion.

He said MBSB had seen an increase of 118.81% year-on-year (y-o-y) in its personal financing loans to RM8.72 billion in its FY2011 ended Dec 31, from RM3.99 billion the preceding year.

Meanwhile, its revenue for FY2011 was RM1.27 billion, a 65.02% y-o-y growth from RM769.94 million.



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Jaya Tiasa top gainer, up 2.7%

KUALA LUMPUR (April 5) : JAYA TIASA HOLDINGS BHD [] shares added as much as 2.7% to become the top gainer on Thursday noon ahead of the ex-date for its treasury shares the following day.

Jaya Tiasa plans to distribute to shareholders one treasury share for every 20 existing shares held in the timber and PLANTATION [] entity.

The stock rose 24 sen to settle at RM9 at 12.30pm with 86,500 shares done.



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