Sunway, TRC up on units getting MRT Corp jobs

KUALA LUMPUR (May 9): Sunway Bhd and TRC SYNERGY BHD [] shares respectively rose on Wednesday after their units were named among the four companies awarded additional CONSTRUCTION [] packages worth RM3.22 billion for the Sungai Buloh - Kajang MRT.

At 3.20pm, Sunway jumped 12 sen to RM2.42 with 1.38 million shares traded while TRC was up two sen to 74.5 sen wih 1.08 million shares done.

MRT Corp on Wednesday said Sunway’s unit Sunway Construction Sdn Bhd and TRC's subsidiary, Trans Resources Corporation Sdn Bhd were among the four companies awarded the additional packages.

Sunway Construction were awarded package V4 for worth RM1.17 billion for works between Section 17, Petaling Jaya and the Semantan Portal, while Trans Resources Corporation were awarded the Depot package worth RM458.98 million for works related to the Sungai Buloh depot in an open tender category.

Meanwhile, Trans Resources Corporation was awarded the final package for works related to the Sg Buloh Depot.



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Theta Edge posts net loss RM1.49m in 1Q

KUALA LUMPUR (May 9): Theta Edge Bhd posted net loss RM1.49 million in the first quarter ended March 31, 2012 compared to net profit RM80,400 a year earlier, due to the small margins derived from the trading revenue which was insufficient to cover the group overheads.

The company said on Wednesday that its revenue for the quarter fell to RM19.37 million from RM21.24 million in 2011.

Loss per share was 1.39 sen compared to earnings per share of 1.27 sen, while net assets per share was 79 sen.

On its prospects, Theta Edge said it expects that the financial year 2012 would remain challenging.

“Barring any unforeseen circumstances, the board expects improved performance for the financial year ending 2012 as compared to financial year 2011,” it said.



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Moody's: Asian Liquidity Stress Index stabilises in April

KUALA LUMPUR (May 9): The Asian Liquidity Stress Index (Asian LSI) has stabilised to 15.3% in April after the downgrade to upgrade ratio moderated, according to Moody's Asia Liquidity Stress Index report.

in a statement on Wednesday, Laura Acres, a Moody's vice president and senior credit officer said that in April, the liquidity sub-index for Chinese speculative-grade companies stood at 15.6%, down from the high of 18.6% in March.

“While there was some improvement for the liquidity of Chinese property companies, it remains of note that almost one in four of such companies have weak liquidity," she said.

Moody’s said the index, which increases when speculative-grade liquidity appears to decrease, is near its highest level since October 2010.

However, it remains well below the high of 37% recorded in 4Q08 during the financial crisis, it said.

It stabilised to 15.3% in April compared to 15.5% in March, as the downgrade to upgrade ratio moderated with just one downgrade compared to one upgrade after three quarters of downgrades exceeding upgrades, it said.

In absolute terms, 15 of the 98 issuers in the speculative-grade portfolio demonstrated weak liquidity as at end April compared with 15 of 97 issuers in March.

"As such, a strong negative bias remains with almost 40% of the speculative-grade portfolio having a negative outlook or being on review for downgrade," Acres said.

Moody's still expects a moderate erosion of liquidity this year, as a tight credit supply in China flows through to the wider corporate space.

In 1Q12 in Asia, concerns about euro area sovereign debt and a more general economic slowdown seemed to ease as markets reopened and investors showed appetite for Asian risk.

However, more recently, a level of caution has prevailed and there remain several deals in the market yet to complete.



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Sunway, TRC Synergy among beneficiaries of 4 additional packages of RM3.2b for MRT

KUALA LUMPUR (May 9): Sunway Bhd's unit Sunway CONSTRUCTION [] Sdn Bhd and TRC SYNERGY BHD []'s subsidiary, Trans Resources Corporation Sdn Bhd, are among the companies that secured four additional construction packages worth RM3.22 billion for the Sungai Buloh - Kajang MRT.

"After the award of the Viaduct 5 and Viaduct 6 packages in January (to IJM Construction Sdn Bhd and Ahmad Zaki Sdn Bhd respectively), and the award of the underground package in March (to MMC-Gamuda JV), these awards show further progress for the Sungai Buloh-Kajang line," said Datuk Azhar Abdul Hamid, MRT Corp CEO, in a statement on Wednesday.

The packages - Viaduct 1, Viaduct 4, Viaduct 7 and Depot 1 - are worth RM3.22 billion and include the construction and completion of viaduct guideways and related works while the depot package is for the construction of the Sungai Buloh Depot and related buildings.

Sunway Construction was awarded package V4 worth RM1.17 billion for works between Section 17, Petaling Jaya and the Semantan Portal, while Trans Resources Corporation was awarded the Depot package worth RM458.98 million for works related to the Sungai Buloh depot in an open tender category.

Meanwhile, package V1 worth RM1.09 billion, a bumiputera exclusive package, covering works between Sungai Buloh and Kota Damansara was clinched by Syarikat Muhibbah Perniagaan and Pembinaan Sdn Bhd and package V7 worth RM499.98 million was secured by MTD Construction Sdn Bhd for works between Bandar Tun Hussein Onn and Taman Mesra in Cheras, said MRT Corp.


"The evaluation looks at various factors, including technical capability, financial strength and of course price. The key is finding a fit that will ensure the project gets the best technical input from a capable contractor while maintaining costs within our expectation for the packages," he explained.

MRT Corp said it expected to award more tenders over the next month.



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Southern Steel in JV with Belgian firm to make steel wires in Asean region

KUALA LUMPUR (May 9): SOUTHERN STEEL BHD [] has entered into a joint venture (JV) agreement with Belgium-based NV Bekaert SA (NV BK) to form a JV company in Singapore to manufacture specified steel wires in the ASEAN region.

Southern Steel said in a filing on on Wednesday that it would hold 45% in the JV and NV BK the remaining 55%.

“NV BK is a public company listed on Euronext Brussels (BEKB).

“It is a global player in drawn steel wire products and technologically strong in advanced solutions based on metal transformation and coatings. Presently, NV BK serves customers in more than 120 countries,” it said.

Southern Steel said it would sell its entire equity interests in three of its subsidiaries to the JV company while NV BK would sell its entire stake in its Indonesian subsidiary to the JV for an aggregate consideration of the equivalent of US$44.6 million.

Southern Steel said it would sell its entire equity interests in its wholly-owned subsidiaries, Southern Speciality Wire Sdn Bhd (“SSW”) and Southern Wire Industries (Malaysia) Sdn Bhd (“SWI”) together with its wholly-owned subsidiary, Cempaka Raya Sdn Bhd to the JV Co.

It said NV BK will sell its entire galvanized and multi-coated wire business in Indonesia currently undertaken by its Indonesian subsidiary, PT Bekaert Indonesia to the JV Co

Southern Steel said the JV would provide it the opportunity to expand its steel wire manufacturing and sale business and to jointly promote the Southern Steel and NV BK brand in the Aseaon market.



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KLCI remains in the red at mid-day as Asian markets slide

KUALA LUMPUR (May 9): The FBM KLCI remained in the red at the mid-day break on Wednesday in line with the slump at key regional markets, following the overnight fall at Wall Street.

At 12.30pm, the FBM KLCI was down 3.04 points to 1,587.56, weighed by select blue chips.

Losers beat gainers by 386 to 207, while 286 counters traded unchanged. Volume was 692.41 million shares valued at RM558.87 million.

The ringgit weakened by 0.34% to 3.0675 versus the greenback, crude palm oil futures fell RM6 per tonne to RM3,334, crude oil fell 35 cents per barrel to US$96.66 while gold lost US$14 an ounce to US$1,591.48.

Shares, gold and oil fell and the euro remained pressured on Wednesday as Greece struggled to form a government two days after an election, heightening the risk that a hard-won bailout deal could be scrapped, according to Reuters.

Radical leftist Alexis Tsipras meets the leaders of Greece's mainstream parties on Wednesday to try to form a coalition government, an effort seen as doomed after he demanded that pledges made in exchange for an European Union/International Monetary Fund rescue package be torn up, it said.

Officials estimate Greece could run out of money as soon as next month if it does not stick to the aid package terms, which kept the country solvent and in the single currency bloc, said Reuters.

At the regional markets, Japan’s Nikkei 225 lost 1.62% to 9,032.78, Hong Kong’s Hang Seng Index fell 0.94% to 20,292.00, the Shanghai Composite Index fell 1.33% to 2,416.28, Taiwan’s Taiex shed 0.86% to 7,480.85, South Korea’s Kospi fell 1.10% to 1,945.31 and Singapore’s Straits Times Index shd 0.65% to 2,912.84.

On Bursa Malaysia, BAT fell 48 sen to RM55.20, F&N down 16 sen to RM18.88, Petronas Dagangan 14 sen to RM19.80, Sarawak PLANTATION []s and MSM lost 11 sen each to RM2.92 and RM5.20, Sarawak Oil Palms and Iretex down 10 sen each to RM6.56 and RM1.20, while BLD Plantations and IJM Corp fell nine sen each to RM8.81 and RM5.45.

Harvest Court was the most actively traded counter with 48.1 million shares done. The stock fell half a sen to 70.5 sen.

Other actives included Permaju, Metronic, Ingenuity Solutions, Naim Indah Corp, Ariantec, Focus, CBSA and Perisai.

Gainers in the morning session on Wednesday included GAB, KGB, Cybertowers, MTD ACPI, Rubberex, United Plantations, Sunway, Ajinomoto, Mercury and Kawan Food.



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Malayan Flour Mills allocates RM120m to expand Malaysian ops over the next two years

KUALA LUMPUR (May 9) : MALAYAN FLOUR MILLS BHD [] (MFM) is allocating some RM120 million to expand its flour factory and poultry operations in Malaysia over the next two years.

Managing director Teh Wee Chye said the capital expenditure will be financed with the firm's internal funds and bank loans.

"We need to increase efficiency in our operations," Teh said at the company's shareholders meeting here today.

MFM has also earmarked USD15 million to expand its two flour factories in Vietnam, he said.



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KLCI hovers in negative territory at mid-morning

KUALA LUMPUR (May 9): The FBM KLCI hovered in negative territory at mid-morning on Wednesday in line with the overnight fall at Wall Street and weaker sentiment at regional markets, underpinned by global economic and political worries.

At 10.01am, the FBM KLCI fell 3.03 points to 1,587.57, weighed by select blue chips.

Gainers trailed losers by 132 to 234, while 219 counters traded unchanged. Volume was 237.19 million shares valued at RM17908 million.

Asian shares fell and the euro stayed pressured on Wednesday, as Greece struggled to form a government two days after elections, raising the risk that a hard-won bailout could be nullified, according to Reuters.

BIMB Securities Research in a note Wednesday said the conditions in Europe was ripe for traders to create some volatility in the equity markets and yesterday could be the beginning of the trend.

With the initial focus on Spain and now the political issues in France and Greece, investors may be in for a roller coaster ride this month, it said.

Reacting to the European uncertainty, the Dow Jones Industrial Average sank 76.44 points to 12,932 but off its intra-day low of 12,810, it said.

“Needless to say, European bourses took the brunt of yesterday’s selling as all ended up in a sea of red,” it said.

The research house said regional markets had a mixed session possibly from the weak opening in Europe amid the ongoing consolidation mode.

“Locally, the FBM KLCI rebounded by 5.73 points to just above the immediate 1,590 resistance at 1,590.60.

“For today, it will be interesting to gauge the resilience of investors whether they will all jump into the selling bandwagon. For us, we believe there will be some broad based knee jerk reaction and should pressure the FBM KLCI on the downside,” it said.

On Bursa Malaysia at mid-morning, F&N Fell and Petronas Dagangan fell 14 sen each to RM18.90 and RM19.80, Hong Leong Bank and Genting down 12 sen each to RM12.12 and RM10.54, Sarawak PLANTATION []s 11 sen to RM2.92, Rapid and IJM Corp 10 sen each to RM2.57 and RM5.44, while NPC, MAHB and Ajiya lost eight sen each to RM2.60, RM5.71 and RM1.60 respectively.

Permaju was the most actively traded counter with 25.7 million shares done. The stock rose 3.5 sen to 91 sen.

Other actives included Harvest Court, Naim Inda Corp,Perisai, Sanbumi, Metronic, Compugates, JCY and Komark.

Gainers included KGB, Tasek, Komark, KLK, Mercury, CIMB, SKB Shutters, Multico, Perisai and Permaju.



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