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https://theedgemalaysia.com/node/74234

Masterskill extends its losses in third quarter

English

KUALA LUMPUR: Masterskill Education Group Bhd (MEGB) continued to suffer quarterly losses, with its third quarter (3Q) ended Sept 30, showing a net loss of RM7.65 million on a revenue of RM35.03 million. For 2Q, the education institution group posted a net loss of RM4.85 million on a revenue of RM39.37 million. The 3Q loss brings MEGB’s net loss for the nine-month period to RM15.42 million. In contrast, the group recorded a net profit of RM39.71 million for the previous corresponding period. “The lower revenue was attributed to lower student enrolment in the reporting period due to competition in the market. The reduction in PTPTN loan amount and the higher entry requirement for the nursing programme resulted in lower student enrolment,” the group said in its filing with Bursa Malaysia yesterday. MEGB also attributed the results to a higher depreciation and increase in staff cost stemming from the new lower ratio for teaching staff to students set by the Malaysian Qualification Agency. The ratio now stands at one teaching staff to 20 students, from 1:30 previously. “The higher loss was also attributable to a one-off write-off of renovation and equipment costs of RM5.3 million for certain teaching facilities that were vacated during the quarter.”The group said this would be a challenging year as more universities and colleges from both the public and private sectors were offering nursing and allied health programmes. But it will continue to pursue opportunities in other segments of the domestic and international market to realise its long-term growth strategy. This will be done through new and diversified product offerings, such as business, hospitality and tourism programmes in the local as well as the international markets. This article first appeared in The Edge Financial Daily, on Nov 30, 2012.

https://theedgemalaysia.com/node/6633

No fire sale

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If you were hoping to snag a property on fire sale in Damansara Heights, one of Klang Valley’s most sought-after residential enclaves, you’re probably wasting your time. Recessionary times or not, there is no lack of interest in this enclave in Kuala Lumpur, which was once a rubber plantation before developer Syarikat Perumahan Pegawai Kerajaan Sdn Bhd (SPPK) transformed it into a residential address — at that time primarily for government servants — four decades ago. Despite a slowdown in the property market amidst the global credit crisis, recent transactions in Damansara Heights have been limited as owners are in no hurry to sell. The latest data compiled by the Ministry of Finance’s Valuation and Property Services Department shows that bungalow lots on Jalan Setiamurni, Jalan Setiabistari and Jalan Beringin in Damansara Heights were transacted at between RM500 and RM600 psf last year. For an idea of current values, consider this: Six months ago, the owner of a 7,000 sq ft bungalow plot located within the freehold and gated Seri Beringin development in Damansara Heights put it up for sale at RM700 psf. Eager buyers responded with offers of RM680 to the RM700 psf sought by the owner. However, the positive response prompted the owner to not only change his mind but also to raise his price twice, to RM750 psf currently. This tract, according to the real estate negotiator who is marketing it, has a flat terrain atop elevated ground. With a clear view of the Kuala Lumpur City Centre, the land was successfully bought in a tender from the developer, Island & Peninsular Sdn Bhd (I&P), for RM620 psf two years ago. Still, not all land in Damansara Heights — including that within Seri Beringin — can command such prices. According to Regroup Associates’ data, a 9,157 sq ft tract on Jalan Seri Beringin 2 was on the market earlier this year for RM700 psf while a smaller 8,450 sq ft plot, also within Seri Beringin, was going for RM420 psf about two months ago. The value of bungalow land in Damansara Heights hinges largely on its micro locale, shape, size, terrain and the view it offers. Zerin Properties’ CEO Previndran Singhe tells City & Country that early this year, a bungalow plot of 8,000 to 9,000 sq ft in Seri Beringin changed hands on the secondary market for RM610 psf. Then, just before Chinese New Year, a plot of less than 10,000 sq ft in Seri Beringin is believed to have changed hands for RM400 psf. This plot apparently sits near a main road junction and faces semi-detached homes. Seri Beringin is a 42-acre development in Damansara Heights, located on a hillock off Jalan Beringin. Developed by SPPK, a subsidiary of I&P, Seri Beringin offers semidees, bungalows and bungalow lots. The developer has retained the bungalows and some semidees for recurring income. The first Seri Beringin bungalow lot launched in September 2005 was priced at RM350 psf. To date, the developer has sold 56 of the total of 71 lots, 25 of them via tender. Last year, two lots were tendered, and the highest bid received was RM636 psf. Of the remaining 15 lots, I&P group managing director Datuk Jamaludin Osman tells City & Country, six (from 6,000 sq ft) are being sold at about RM540 psf. The other nine lots, sitting on elevated ground, will be put out to tender with reserve prices of RM546 to RM572 psf. Meanwhile, KS Properties’ principal, K S Liew, has been looking for a buyer for a freehold 48,000 sq ft tract on Jalan Bruas in Damansara Heights for over a year now. Interestingly, during this period, the owner increased his asking price from a range of RM350 to RM360 psf to RM398 psf. The triangular site that sits on a slope has attracted prospective buyers but the price is a sticking point, says Liew. It must be noted that some parcels of land on Jalan Bruas are close to high-tension wires as well as the construction site of the new National Palace Kuala Lumpur. As City Two Properties senior real estate negotiator Christie Jacobs points out, land prices in Damansara Heights can swing from RM400 to RM600 psf or so. The pricier areas are the newer ones and located near Plaza Damansara, one of the commercial centres in Damansara Heights. These areas would include Jalan Setiakasih, Jalan Setiamurni and Jalan Chelagi, which can fetch RM550 to RM600 psf. Older areas like Jalan Setiarasa, Jalan Setiabudi and Jalan Setiajaya, which have been around since the late 1970s, are priced lower at around RM450 psf, says Jacobs. The larger tracts seem to carry some discount. On Jalan Batai near the Commonwealth Club on Jalan Birah, tracts that are 12,000 sq ft and above are going for a cheaper RM420 to RM450 psf, Jacobs points out. Land with buildings is just as attractive here. Based on Regroup Associates’ data, a semidee with land area of 3,690 sq ft on Jalan Setiakasih has been on the market for the last three months at RM3.1 million. Another unit with a land area of 3,600 sq ft in Seri Beringin was going for RM3.2 million in January. Three months ago, a renovated 2-storey bungalow on Jalan Setiabakti (land area: 9,000 sq ft) was put up for sale for RM12 million. Four months ago, an owner was asking RM8 million for his renovated 2-storey bungalow (land area: 11,700 sq ft) on Lorong Jarak. Not all investors in Damansara Heights are owner-occupiers. In 1999, a local bought a 2-storey bungalow (land area: 5,000 sq ft; built-up: 3,500 sq ft) on Jalan Damansara for RM1.5 million. After renovating it and increasing the built-up to 6,000 sq ft on three levels, he sold it for RM3.5 million to a foreigner, says Fernstate Sdn Bhd senior manager Shawn Fernandez. Micro location wise, Fernandez points out that while Setiamurni and Setiabakti are hot due to their proximity to Plaza Damansara and public transport facilities, the more quiet Jalan Damansara, Jalan Jelutong and Taman Sa are equally attractive. He explains: “These areas have lots of greenery and are matured and quiet thanks to the absence of buses and taxis. Many owners here are locals who have been around for a long time and have no intension of relocating.” At end-2005, a 15,500 sq ft bungalow tract on Jalan Damansara was sold for RM2.6 million (RM168 psf). About six months later, the same plot changed hands at 38% higher or RM3.6 million (RM232 psf). In December 2008, the owner was offered RM380 psf for the land but he did not sell, says Fernandez. He adds that the same tract can easily fetch from RM400 psf to RM450 psf today. Semi-detached units and condominiums in Damansara Heights are just as sought after. Tan & Tan Development Bhd launched the gated Semantan Villas on Jalan Semantan back in 1997 and 1998. The 50 units of 2½-storey semi-detached homes (land area: 4,000 sq ft; built-up: 4,000 sq ft) were then tagged at about RM1.5 million and in 2005, Fernandez sold a typical unit for RM2.4 million. Two years later, the same unit changed hands for RM2.65 million. In the second quarter of 2008, this unit again changed hands, this time for RM2.75 million. According to Fernandez, partially furnished units can fetch monthly rentals of RM12,000 to RM14,000. Foreigners make up 90% of the tenants at Semantan Villas. Also in 2005, a about 1,800 sq ft condo at Prima Damansara on Jalan Chempenai was sold for between RM450 psf and RM500 psf. Early this year, the same unit changed hands at RM900 psf. Another Tan & Tan Development project, Prima Damansara, that was completed in 1991, has 98 units housed within a 5-storey block. Basic, partially furnished units here are leased for between RM7,000 and RM13,000 monthly. According to Fernandez, asking prices of a basic 1,350 sq ft unit are in the region of RM700,000, which translates to RM520 psf. “This is another project with as high as 75% foreigner occupancy. Values here have risen in the last five years given the limited supply of good and well managed condominiums in Damansara Heights,” he says. Blast from the pastBesides its strategic location, Damansara Heights’ popularity has enjoyed a boost because of the better accessibility afforded by the Sprint Highway, Duta-Ulu Kelang Expressway, Penchala Link and the widened Jalan Duta. Besides being close to internationals schools, new commercial buildings like Menara Millenium, HP Tower and UOA with multinational tenants have emerged in Damansara Heights, boosting the housing need of expatriates. “In US dollar terms, monthly rentals of RM15,000 in Damansara Heights are considered dirt cheap,” says Fernandez, whose office has been based here for the past three decades. Fernandez recalls SPPK selling some land in Damansara Heights to Selangor Properties Bhd to build areas like Taman Sa, Jalan Jelutong and Pusat Bandar Damansara. “Many may not know that Taman Sa is actually Taman Satu Amoy and the Pusat Bandar Damansara land was formerly planned as a golf course. Selangor Properties first sold the bungalow lots on Lorong Batai Barat for only RM8 psf four decades ago. Today, the land values here are easily RM450 psf.” says Fernandez, who has been marketing Damansara Heights properties for the last two decades. How did Damansara Heights fare in the Asian financial crisis? Fernandez recalls that average land values dropped to as much as RM150 psf while base lending rates soared to as high as 8% to 13%. “There were some fire sales with asking prices dipping 20% to 25%. However, once we were out of the recession, prices jumped to RM200 and RM300 psf due to the high volume of buyers,” he shares. And while property transactions in Damansara Heights have slowed following the current global credit crisis, a gradual rise in asking prices had been noted by December 2008 because of interest from local owner-occupiers, says Fernandez. “Since these are not speculative buys, I don’t expect to see a bubble here,” he says. Zerin Properties’ Previndran, in fact, sees prices of bungalow land in Damansara Heights still moving up due to the limited supply. Regroup Associates executive director Paul Khong says demand in the locality has always been strong and relatively stable because it is acknowledged as an established upmarket area which many of the country’s social and corporate elite call home. Fernandez notes that the last two years have seen an influx of foreign buyers, mainly from the US, Germany, England and Europe, looking for both landed and high-rise properties for their own use. “Having lived here, they like Damansara Heights not only because their friends are close by, but also because they have witnessed how property values and rentals here have performed,” says Fernandez. He adds: “Don’t expect fire sales in Damansara Heights.” This article appeared in City & Country, the property pullout of The Edge Malaysia, Issue 753, May 4 – 10, 2009.

https://theedgemalaysia.com/node/30052

Hurt by Sime’s losses

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Shares on the Bursa Malaysia traded broadly lower Friday, May 14. Market breadth stayed mostly in the red while the headline index, the FBM KLCI was also in negative territory throughout the trading day before ending nearly eight points lower at 1,339.3. Part of the benchmark index’s fall can be attributed to heavyweight, Sime Darby. The stock dropped 4.6% to RM8.25 on active trade after unveiling nearly RM1 billion in cost overruns from its energy and utility projects. The overruns are expected to result in the company’s first quarterly loss. Sime is slated to release its earnings results for 3QFYJune10 later in the month. The company’s CEO has been asked to take a leave of absence. Investors were unimpressed by the strong 1Q10 GDP growth of 10.1%, released Thursday evening. It was the fastest clip in a first quarter since 2000. Bank Negara Malaysia raised its overnight policy rate by 25 basis points to 2.5%, to head off any potential inflationary threat and normalise its monetary policy post credit crisis. Sentiment may also have been affected by the Dow Jones Industrial Average’s 114-point drop overnight. Bellwether indices in Japan, Hong Kong, Singapore and China too ended lower for the day. US stocks were hurt by the latest data on initial jobless claims, which fell at a slower than expected pace despite apparent improvement in the job market of late. In the previous week, the US had reported a strong payroll growth of 290,000 jobs in April, the biggest gain in four years. There are concerns that persistent high unemployment could eventually weigh on the recovery in consumer spending. In other developments, the US government widened its probe on banks’ activities related to mortgage-related securities. Investigations had previously focused on Goldman Sachs, which is currently facing a civil fraud suit brought on by the Securities and Exchange Commission.

https://theedgemalaysia.com/node/52721

Bursa Malaysia reprimands two delisted firms

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KUALA LUMPUR: Bursa Malaysia has publicly reprimanded and fined to directors of two delisted companies for previously failing to make immediate announcements on defaults of various credit facilities. The two companies are technology firm Mangotone Group Bhd (MTone) and publishing company Rhythm Consolidated Bhd, both of which had been delisted in 2010. In separate filings yesterday, Bursa Malaysia said it had reprimanded MTone and six of its directors for failing to make immediate announcements following the default in payments of credit facilities by MTone and its subsidiaries. Bursa also said it had fined MTone’s then managing director Ahmad Akmal Hamzah and three executive directors a total of RM300,000. MTone and its subsidiaries had defaulted on eight credit facilities between April and July 2009, according to the filing. According to Bursa, MTone had explained that it did not make an announcement on the defaults to avoid intervention from the company’s creditors in blocking or challenging the company’s application for a restraining order under Section 176 of the Companies Act 1965. Bursa said the explanation was not acceptable and did not absolve MTone’s obligation to make an immediate announcement of the defaults in payment. MTone was listed on the then Mesdaq Market of Bursa Malaysia before the company was delisted on Sept 8, 2010. As for Rhythm Consolidated, Bursa said it publicly reprimanded the company and its three directors for failing to make immediate announcements of its subsidiaries’ numerous defaults in payment of credit facilities and material litigation it was involved in. Rhythm Consolidated only made those announcements in 2009 for events that had occurred in 2007 and 2008, Bursa said. The company had attributed the delay in making the announcements to the shortage of staff and inexperienced staff, a reason which Bursa said was unacceptable and did not absolve its liability. Bursa also fined Rhythm Consolidated’s group executive chairman Ahmad Redza Ahmad Khairuddin a total of RM350,000 for the breaches. This article appeared in The Edge Financial Daily, August 4, 2011.

https://theedgemalaysia.com/node/20817

S Korea plans US$1.5b 5G ‘movie-in-a-second’ service

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SEOUL:South Korea, already one of the most wired countries on earth, yesterday announced a 1.6 trillion won (RM4.99 billion) plan to roll out a next-generation 5G wireless service quick enough to download full-length films in a second. The science ministry said it aims to implement the technology — about 1,000 times faster than the 4G services currently available — within six years. “We helped fuel national growth with 2G services in the 1990s, 3G in the 2000s and 4G around 2010. Now it is time to take pre-emptive action to develop 5G,” the ministry said in a statement. “Countries in Europe, China and the US are making aggressive efforts to develop 5G technology ... and we believe there will be fierce competition in this market in a few years,” it said. Under the roadmap, a trial 5G service will be rolled out in 2017 and a fully commercial service in December 2020. Priority will be given to developing key features for the new network, including Ultra-HD and hologram transmission as well as cutting-edge social networking services. Related industries will be able to rack up sales of 5G-related devices and infrastructure equipment worth 331 trillion won from 2020 to 2026, the ministry estimated. The government hopes to implement the plan with investment and cooperation from operators such as SK Telecom and Korea Telecom as well as handset makers like Samsung and LG. It also aims to expand the telecom infrastructure equipment industry, which is relatively weaker than the mighty mobile device sector. Led by Samsung — the world’s top handset maker — South Korea has a leading 30% stake in the global mobile device market. “But the [telecom] infrastructure equipment industry has only a 4.4% share in the global market, with exports very limited,” the ministry said. Chinese equipment makers including Huawei have expanded their presence in the global market from 12% in 2007 to 26% in 2012. Huawei announced in November that it was looking at a 5G commercial rollout by 2020, with a minimum investment of US$600 million (RM1.996 billion) to develop the technology. Seoul intends to take up to a 20% stake in the world’s telecom infrastructure equipment market by 2020, according to the ministry. South Korea is renowned for being at the forefront of Internet technology with broadband speeds that consistently outpace those in Europe or the US. The 5G technology will allow users to download a 800-megabyte movie file in one second, compared with 40 seconds using 4G, the science ministry said, adding that such speeds would help South Korean firms win overseas deals. Officials said the new service would also mean people on bullet trains running faster than 500kph an hour would even be able to access the Internet, compared with 300kph currently. “Bullet trains around the world keep getting faster, with some in China running as fast as 500 and 600 kilometres per hour,” said one ministry official who declined to be named. “If we have the technology to allow fast Internet access in these trains, it can open new opportunities for us globally,” he said. Samsung Electronics announced back in May that it had successfully tested 5G technology. — AFP This article first appeared in The Edge Financial Daily, on January 23, 2014.

https://theedgemalaysia.com/node/32107

CMS to raise cement prices next month

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Cahya Mata Sarawak Bhd(Jan 20, RM7.39) Maintain strong buy at RM7 with a revised target price of RM8.22 (from RM7.57): CMS announced at a media briefing that it will raise its cement selling price in Sarawak by 5% to 9% (depending on location) effective Feb 17,  2014. This is the first hike since the previous 5% hike in 2011. From 2009 to 2013, CMS had increased the price of cement by only 5.2% although overall production cost rose by 14.5%. Comparatively, Peninsular Malaysia-based cement producers had increased their cement selling prices twice during the same period of time — by 10% and 6% in 2010 and 2011 respectively. CMS said the increase in selling prices was necessary as it was not sustainable for the company to continue to absorb the increase in production costs and at the same time, make substantial capital investments for its cement division. For example, CMS spent more than RM56 million over the last six years to improve its pan-Sarawak distribution capability as well as another RM80 million to upgrade its clinker plant in Mambong last year. Given the strong demand for building materials in Sarawak brought about by rapid infrastructure development in the state, we believe the impact of this cement price hike on demand will be relatively minimal. In fact, current cement demand in Sarawak is actually in excess of the local production by CMS. According to management, an estimated 200,000 tonnes of cement (or about 12% of market demand) is expected to be imported in order to meet Sarawak’s cement demand in 2014 (despite  high utilisation rate of 90% for CMS’ cement plant). Given the strong cement demand and CMS’ unique position as sole cement producer in Sarawak, we believe there will be very little competitive and/or pricing pressures affecting this price hike. As such, we raise our average cement selling prices assumptions by 5% for financial year 2014 ending Dec 31 (FY14) and FY15. Correspondingly, our FY14 and FY15 earnings forecasts are raised by 9.7% and 8.3% respectively. Post-earnings adjustment, our sum-of-parts-based target price for CMS is revised to RM8.22 (from RM7.57), which still implies an undemanding valuation of 10.9 times FY14 price-earnings ratio (ex-net cash) and 1.4 FY14 price-to-book value. Maintain “strong buy” recommendation. Despite the recent surge in its share price, CMS remains undervalued, trading at just 8.9 times FY14 PER (ex-net cash) now. We believe market is still under-appreciating the natural monopoly of CMS’ cement division (that will not be affected by rising competition or hike in electricity tariff) and the value of its 20% investment in OM Materials (Sarawak) Sdn Bhd. — Alliance IB Research, Jan 20 This article first appeared in The Edge Financial Daily, on January 21, 2014.

https://theedgemalaysia.com/node/53874

Time Engineering in the black

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KUALA LUMPUR: Time Engineering Bhd posted net profit of RM2.53 million in the second quarter ended June 30, 2011 from a net loss of RM4.29 million a year ago due to a reversal of RM5.8 million, being the over-provision of the finance cost of the group’s redeemable secured loan stocks (RSLS). It said on Wednesday, Aug 24  revenue fell 28.4% to RM17.49 million from RM24.44 million  as it had completed the MAMPU project and supply of ICT Equipment for MIS Implementation in Vietnam.  Earnings per share were 0.33 sen compared with loss per share of 0.55 sen. In the first half ended June 30, it was in the red with losses of RM399,000 compared with net losses of RM3.42 million a year ago. Revenue fell 32% to RM33.88 million from RM49.87 million. On the outlook, Time Engineering said the group will be in a better position to improve its business and services offerings as the integrated enterprise centre will be in operation by the end of the third quarter as well as the expected continuous expansion from the e-commerce portfolios.

https://theedgemalaysia.com/node/47644

KPJ advances, upgraded to Trading Buy by MIDF Research

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KUALA LUMPUR: KPJ Healthcare Bhd shares rose in early trade on Thursday, April 14 and were up 10 sen to RM4.21 at 9.40am with 469,300 shares traded. MIDF Research upgraded the stock to a Trading Buy with a higher target price of RM4.60 from RM3.51 previously based on EPS12. The research house in a note April 14 said it was raising its implied PER for KPJ to 18 times (from 14 times previously), which is at the high-end of its historical PER band, due to positive newsflow and valuation rerating. “We expect valuation re-rating to outweigh the impact of earnings dilution on warrants conversion. About 23.6% of the total warrants 2010/15 issued have been exercised. “We revised marginally our forecast due to some housekeeping activities. Continuous expansion locally with one or two new hospitals  each year as well as potential venture into countries such as Vietnam, Cambodia and Myanmar will support the company’s future growth and enhance its brand name regionally, MIDF Research said. It said KPJ’s management expects a strong double digit revenue growth in FY11

https://theedgemalaysia.com/node/37754

Public, private sector salaries must go up 6%: KPMG

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KUALA LUMPUR (Jan 7): KPMG Malaysia is urging both the public and private sectors to gradually increase the salaries of their employees following the imposition of the goods and services tax (GST) next April. Newly-appointed Managing Partner Johan Idris suggested a six per cent increase in employees salaries per annum to help tide over the high cost of living in Malaysia. "Six per cent would be a good example to begin with especially after the GST implementation, new electric tariffs, petrol subsidy cuts and new toll rates," he told reporters after the launch of the second-edition of the 'Study on Non-Executive Directors 2013 - Profile and Pay' publication. Johan said that the GST implementation was inevitable as Malaysia is a developing country.

https://theedgemalaysia.com/node/80821

#Market Open* KLCI erases gains ahead of Bank Negara, ECB decision

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KUALA LUMPUR (Nov 7): The FBM KLCI which opened in positive territory, fell 2.13 points or 0.1%. This is despite the overnight advance in US markets. In Malaysia, analysts believe market sentiment is cautious ahead of Bank Negara Malaysia and the European Central Bank's monetary policy announcements today. At 9.03am, the KLCI was traded at 1,800.92 on losses in stocks like Petronas Gas Bhd and Genting Bhd. Analysts said previous gains in the KLCI may prompt investors to lock in profits today. In a note, BIMB Securities Sdn Bhd said "the market may be undergoing some consolidation at the moment following a solid run-up in October." BIMB which expects trading to stay cautious today, sees the KLCI's immediate support at 1,800 points. Bursa Malaysia saw some 69 million shares worth RM35 million changed hands. There were 117 gainers versus 49 decliners. The top gainer was Carlsberg Brewery Malaysia Bhd. Petronas Gas led decliners while the most-active stock was Astral Supreme Bhd. Across Asia, Japan's Nikkei added 0.16% while Australia's S&P/ASX200 declined 0.23%. Reuters reported that Asian stocks got off to sluggish start on Thursday as investors hunkered down to take the latest pulse on the U.S. economy and implications for the Federal Reserve's easy money policy, while the euro perked up ahead of the European Central Bank meeting. All eyes will be on Friday's non-farm payrolls data for further gauge on when the Fed will begin winding down its $85 billion-a-month bond-buying programme. The Dow Jones industrial average finished at a record closing high, up 128.66 points, or 0.82 percent, at 15,746.88, after earlier reaching a lifetime high of 15,750.29. TheStandard & Poor's 500 Index ended up 7.52 points, or 0.43 percent, at 1,770.49. A 14.5 percent plunge in shares of Tesla Motors Inc, after the electric car maker gave a disappointing outlook for its fourth quarter late Tuesday, weighed on the Nasdaq Composite Index, which ended down 7.92 points, or 0.20 percent, at 3,931.95.

https://theedgemalaysia.com/node/60181

PR1MA to achieve 2013’s target of building 80,000 houses in 1Q

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KUALA LUMPUR (Jan 21): PR1MA Corporation Malaysia (PR1MA), the agency mandated by the government to build affordable homes, is targeting to achieve its 2013 target of building 80,000 affordable units by the end of this quarter. Its chief executive officer Datuk Mutalib Alias said after a book launch by Cagamas Holdings Bhd today that “hopefully” by end of the current quarter, the firm would get approval for another 35,000 units affordable homes from the board. "Currently, the board has already approved 45,000 units, we hope to complete launching the projects before starting to plan for new projects for this year," he told reporters after a dialogue on "Challenges and Prospects for Affordable and Accessibility to Housing in Malaysia". The company has set a target of building 80,000 affordable homes by end of this year. A total of 160,000 units is part of the 500,000 affordable homes to be rolled out by PR1MA. During the dialogue with three other panelists, Mutalib pointed out that the firm would engage with private property developers because it was only given 100 acres by the federal government. "We need about 2,000 acres to build all affordable house and we have no choice but to engage with private developers." He added that the company has also tried to obtain cooperation from developers in Sabah and Sarawak. Apart from Mutalib, the panelists of the dialogue are Ministry of Urban Well Being, Housing and Local Government director Gurdev Singh, Syarikat Perumahan Negara Bhd (SPNB) managing director Datuk Kamarul Rashdan Salleh and Real Estate and Housing Developers' Association (REHDA) president Datuk Michael Yam. Earlier, the book launch was officiated by Senator Datuk Sri Abdul Wahid Omar, Minister in the Prime Minister's Department.

https://theedgemalaysia.com/node/2359

SEGi closes at highest in 5 years

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KUALA LUMPUR: SEG International Bhd (SEGi), which saw EcoFirst Consolidated Bhd ceasing to be a substantial shareholder, rose one sen yesterday to RM1.73, its highest close since early May 2005. The stock was traded at between RM1.68 and RM1.73 for the day, with a total of 68,100 shares changing hands.According to a filing with Bursa Malaysia Securities, EcoFirst ceased to be a substantial shareholder in SEGi after hiving off a 6.39% stake comprising 5.69 million shares. According to Bloomberg, the shares were crossed at RM1.73 a share for a total of RM9.84 million. This divestment, however, did not come as a surprise as in an announcement to Bursa Securities on March 16, EcoFirst had stated that it was looking at selling its 19.87% stake or 17.69 million shares in SEGi, at RM1.73 a share. EcoFirst had earlier sold part of that to Rexter Capital Sdn Bhd, a company that surfaced as a substantial shareholder in mid-March with a 8.29% stake or 7.38 million shares. According to the Companies Commission of Malaysia, Rexter Capital’s shareholders are Lim Peck Thong and Lau Pee Ho, who are also the directors of the company. At end-February this year, a bumiputera company, Cerahsar Sdn Bhd, emerged as a substantial shareholder in SEGi with a 22.45% stake after buying 20 million shares. The bulk of the shares were acquired from Koperasi Pegawai-Pegawai Melayu Malaysia Bhd.

https://theedgemalaysia.com/node/79733

MAS posts 4Q profit of RM51m, full-yr loss shrinks to RM433m

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KUALA LUMPUR (Feb 28): Malaysian Airline System Bhd (MAS) reported a net profit of RM51.37 million in the fourth quarter ended December 31, 2012 (4QFY12) against a net loss of RM1.28 billion a year earlier as higher revenue and foreign exchange (forex) gains lifted its bottom line. The quarterly profit had also come on impairment write-back, lower provision for debt and inventory, besides higher interest income, MAS said in a statement to the bourse today. MAS said revenue rose to RM3.87 billion in 4QFY12 from RM3.68 billion previously. Full-year net loss narrowed to RM432.59 million from a net loss of RM2.52 billion a year earlier as revenue declined to RM13.76 billion from RM13.9 billion. During 4QFY12, the firm said revenue had increased on higher income from airline operations which mitigated the topline decline at the cargo unit. Higher airline revenue was helped by a 7% increase in traffic while the fall in cargo services income was due to a 3% decline in load tonnage and capacity, according to the group. During the quarter, the company’s operating expenses had fallen to RM3.82 billion from RM5 billion, helped by non-fuel factors. The company saw higher forex gains of RM69.47 million versus RM21.73 million. Looking ahead, MAS expects jet fuel prices to stay high as the company contends with more competition from global airlines. The firm said global economic uncertainty across the US, China, and European countries may hamper air travel demand. "Within this environment, MAS continues to accelerate implementation of its business plan to increase revenue and yields and reduce costs. "Aggressive marketing and promotions, better capacity management, improved cost management and driving productivity for better efficiencies system-wide remains the focus area," the company said.

https://theedgemalaysia.com/node/298

Who can do your taxes?

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How do you identify a tax professional and what can he do for you? In this column, I often advise readers not to attempt to “DIY” their tax affairs but to consult tax advisers. But who is qualified to act as a tax agent, tax consultant, and so on? Here’s a question from a reader. Question: I have been told that for someone to do a tax return on behalf of another person, he/she needs to be qualified under Section 153(3) of the Income Tax Act 1967. If I want to employ a tax accountant to do my return, how can I check whether he/she is qualified? Can I obtain a list of qualifi ed tax accountants?Answer: You are right: Only qualified persons are authorised to act on behalf of other persons for the purposes of the Income Tax Act. The relevant provisions in the Act reads as follow:Section 153: Restriction on persons holding themselves out as tax agents, tax consultants, etc. 1. No person holding himself out as a tax agent, tax accountant or tax adviser (or under any other like description) shall be permitted to act in Malaysia on behalf of any person for any of the purposes of this Act unless he is a tax agent as defined in this section. Provided that – Who is an approved tax agent?An approved tax agent is a professional accountant or person who is approved by the Minister of Finance. He must convince the Minister of Finance that he has sufficient practical experience in taxation. The approval process entails an application (furnishing all the requisite details regarding professional qualifications, education background and professional experience) and an interview to establish technical competence. Having been approved, the tax agent will be obliged to keep abreast of current development in taxation through continual professional education (CPE). Chalking up the prescribed minimum CPE hours is essential for continued approved tax agent status. Note that despite the requirement for approval by the Minister of Finance, professional lawyers are not hampered or precluded from acting in their lawful practice for their clients in tax matters. In other words, professional lawyers need not be approved by the Minister of Finance to act on behalf of clients in tax matters. What can the approved tax agent do?Only an approved tax agent is authorised to act on behalf of other persons. What can he do?First of all, “act on behalf” of any person connotes representation of another person. Thus, an approved tax agent may perform the following functions:  Checking the status of the tax agentTo verify the status of any person purporting to be an approved tax agent, you may visit the IRB’s website, www.hasil.org.my. Go to “Tax Information”, “List of Tax Agents” and select the relevant state. A tax agent may be approved to provide tax services for a minimum of 24 months, after which a renewal must be obtained from the Minister of Finance.  Question: I read (in The Essential Guide To Personal Income Tax In Malaysia, by Adam Malik Farouk & others, McGraw Hill, 2008 Edition, pg 168 ) that an individual with a minimum of four properties (commercial, residential or mixed) can treat the rental income as business income. I have not been able to verify this anywhere else. Can you please verify? Answer: In the past, there was a concession by the IRB that if you had four residential properties that were let out, you could treat the rental as business income. However, that concession has been clearly discontinued for individuals with the issuance of Public Ruling 1 of 2004. In fact, the IRB has said that it was never meant to apply to individuals. However, the group treatment (which is not the same as the business-income treatment) has been confirmed to apply to individuals in the said public ruling. The group treatment does not stipulate any minimum units of properties but the properties must fall into any of the three categories (residential, commercial or vacant land).  This article appeared in Issue 89 (January 2009) of Personal Money, the personal finance magazine published by The Edge Communications Sdn Bhd

https://theedgemalaysia.com/node/10765

Azmin: Calls for Selangor exco reshuffle not my personal opinion

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SHAH ALAM: Bukit Antarabangsa assemblyman Azmin Ali today defended his controversial call for a reshuffle of the Selangor state executive council (exco) as being the "people's opinion" rather than his personal views. "It is not my personal opinion but that of the people. Some state assemblymen and government officials support the view as well," Azmin told reporters at the state assembly building here today. Azmin reiterated that the views he expressed during his speech on the supplementary bill yesterday were gleaned from feedback given by the business community and the people. The Parti Keadilan Rakyat (PKR) vice-president caused a stir at the state assembly yesterday when he urged that the Selangor state exco be reorganised in criticising several state government policies. Azmin also said suggestions were "well-intended" to remind the Selangor administration to effectively carry out their duties as per election promises and to remain true to Pakatan Rakyat's (PR) fundamental principles of good governance and human rights. On the proposed reshuffle, Azmin said he would "leave it" to Selangor Menteri Besar Tan Sri Khalid Ibrahim. Responding to Azmin’s remarks yesterday, Khalid said such a move was not necessary as the current exco team "works well together". Speaking to reporters today, Khalid said Azmin's calls for the exco reshuffling was still a "suggestion" which needed to be discussed by PR's top leadership. However, the menteri besar said it was not on the cards, dismissing Azmin's statements as "discussions in the state assembly". "For now, I'd consider it as merely a show. It is not something that would typically (biasanya) be brought to the PR leadership," Khalid said. Azmin, who is Gombak parliamentarian, also denied claims that his statements would be perceived as a weakness in the PR coalition. "It is healthy that we are brave to criticise and give drastic suggestions. This is different from Barisan Nasional (BN) and Umno where their representatives wouldn’t dare to do such a thing. "It should be seen as a healthy and positive thing," Azmin said. In what was perceived as a swipe at Azmin during debates earlier today, Damansara Utama assemblyman Dr Cheah Wing Yin remarked: "Some people are acting like the opposition." When asked to clarify later, Cheah told reporters: "I said there are 'some' people. I support Azmin in certain things." Cheah also remained evasive when pressed on whether he agreed with calls for the exco’s reorganisation. "Well these are very strong words he is expressing. He is expressing what some ADUNs (assemblymen) agree with," Cheah said. Cheah added these issues should be trashed out at the Backbenchers Club but said that the "communication with the excos is not as good as we wish."

https://theedgemalaysia.com/node/34966

InsiderAsia's Model Portfolio Week 389

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EVEN as investors continued to tread cautiously, confidence in the global economic recovery and corporate earnings growth prospects remained on a relatively strong footing. Bellwether indices in key Asian markets closed higher last week. Corporate earnings for 2Q10 have largely measured up, and more often than not, exceeded market expectations — and not just in the US. Stronger-than-expected economic data out of the eurozone is also signalling that the worst could be over for the region, which was rocked by sovereign debt crisis earlier in the year. Actions taken by Greece, so far, have been greeted with praise while a strong manufacturing sector in Germany, bolstered by the weaker euro, is shoring up the economic recovery and investor confidence. In fact, the European Central Bank has been sounding more upbeat than the US Federal Reserve lately. Data continued to suggest that recovery in the world's largest economy remains patchy. Businesses are still reluctant to hire amid sluggish consumer spending, which is in turn, damped by high unemployment rate. The local bourse ended the week flat. The FBM KLCI finished almost unchanged at 1,360.5 points. Trading volume improved from the previous week, to a daily average of about 948 million shares. Our model portfolio performed mixed last week. Six of the 16 stocks in our portfolio closed lower for the week while seven ended higher and three traded unchanged. The best performing stock was Tanjong plc, which surged 20.9% to RM21.26 following the announcement of a general offer at RM21.80 per share. We are making very good gains on our investment. Our cost, after adjusting for dividends, is now only RM9.83 per share. Nonetheless, our portfolio was dampened by the sharp selldown in Notion VTec, which plunged 22.1% last week. HELP International Corp Bhd also saw some profit taking on the back of its recent rally. Overall, our basket of stocks fell 0.53% but including our large cash reserves (for which no interest is imputed), the total portfolio value declined by a lesser 0.4% to RM678,545. Last week's losses pared our model portfolio's cumulative returns since inception slightly to 324.1% on our initial capital of just RM160,000. Nevertheless, we continue to outperform the FBM KLCI, which was up by about 110.3% over the same period, by some distance. Plus, our portfolio holds a significant amount of non-interest yielding cash at all times for prudence's sake. Our total profits are very substantial at RM518,545, of which RM264,345 has already been realised. We sold our 4,000 shares in Notion VTec for a gain of RM1,627. The stock has fallen sharply on the back of production problems and weaker-than-expected earnings in the last quarter. The company also warned of further earnings weakness going forward, guiding down market expectations. Due to the uncertain industry outlook, we decided to dispose of our shares pending clearer leads.Note: This report is brought to you by Asia Analytica Sdn Bhd, a licensed investment adviser. Please exercise your own judgment or seek professional advice for your specific investment needs. We are not responsible for your investment decisions. Our shareholders, directors and employees may have positions in any of the stocks mentioned.

https://theedgemalaysia.com/node/65233

RHB cuts Masterskills’ target price to 37 sen after 3Q results

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KUALA LUMPUR (Nov 27):  RHB research has reduced the target price for Masterskill Education Group Bhd to 37 sen from 50 sen after the company reported wider loss for the third quarter ended Sept 30, 2013 (3QFY13). The education group’s loss widened to RM104.4 million for 3QFY13 from RM7.7 million a year ago. Revenue plunged to RM15.6 million from RM35.0 million in previous year quarter. The research firm noted Masterskill’s nine-month revenue also plunged to RM51.4 million from RM118.5 million in the same period last year. This was due to failure in replenishing its dwindling student base, weighed down by the reduction in National Higher Education Fund Corp (PTPTN) loans as well as the higher entry requirements stipulated for its nursing courses. “While Masterskills’ 9MFY13 reported net loss swelled to RM134.8 million from RM15.4 million in 9MFY12, this was distorted by an impairment provision of RM88.2 million during the quarter under review. “Stripping out this one-off item, its core net loss of RM46.6 million came in slightly below our expectation. The dismal 3QFY13 results mark the group’s eighth consecutive quarterly loss,” said the research house. The research firm slashed its FY13F and FY14F estimates further by 15.0% and 95.4% respectively as it incorporates lower student numbers as well as higher operational expenditure assumptions. “We now project a core net loss of RM66.5 million for FY13F and RM59.4 million for FY14F. “We believe that the one-off exceptional item is part of the group’s efforts to clean up its books to mark the beginning of a new chapter for the group. “That said, we remain cautious over its near term earnings as we await further improvements should the management successfully revamp its business model and steer the company back to the black,” it said.

https://theedgemalaysia.com/node/18520

Distribution for two TA funds

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KUALA LUMPUR: TA Investment Management Bhd (TAIM) has declared a unit split of 1:10 (one additional unit for every ten units held) for unitholders of TA Dana Fokus (TADF) for its financial year ending Apr 30, 2010, and TA Comet Fund (TACF) for its financial year ending Sept 30, 2009.The last entitlement date for both funds is Sept 15, 2009. TADF aims to achieve total return over the medium to long-term period by investing in a focused portfolio, mainly in equities that comply with syariah requirements. TACF's main objective is to provide a channel for investors to invest in low-priced securities which offer good value with great upside potential and with the intention of diversifying into medium-priced securities and blue chips as the market moves higher over the medium to long term."We believe that a recovery in the market and economy is in the initial stages and the uptrend cycle is very much intact. In fact, the good news is that the recovery is coming faster than expected. We will continue to maintain high equity weightage for the funds to maximise potential gains" said Choo Swee Kee, chief investment officer of TAIM. 

https://theedgemalaysia.com/node/70720

Market Close: KLCI falls 0.5% on profit taking

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KUALA LUMPUR (Nov 20): The FBM KLCI fell 8.47 points or 0.5% % as investors locked in profits. This follows the index's substantial gains over the last two days, according to fund managers. At 5pm, the KLCI settled at 1,798.69. This came on losses in stocks like Genting Bhd and Malayan Banking Bhd. "It was due to profit taking," a fund manager told theedgemalaysia.com over telephone today. The KLCI had gained a cumulative 17.29 points over the last two days. Last Monday, the index rose 2.52 points followed by a 14.77-point advance yesterday. Yesterday's rise came on gains in shares of plantation, besides  oil and gas firms, according to the fund manager. Today, Bursa Malaysia saw 1.79 billion shares worth RM2.31 billion changed hands. There were 246 gainers versus 562 decliners. The top gainer was Petronas Gas Bhd while British American Tobacco (M) Bhd led decliners. The most-active stock was Patimas Computers Bhd. Looking ahead, the fund manager said Moody's upgrade on the outlook of Malaysian government debt may result in positive sentiment for the local share market "This is in the medium to long term," he said. Moody's had earlier today upgraded its outlook on Malaysian government debt to "positive" from "stable". According to Moody's, the upgrade takes into account "improved prospects for fiscal consolidation and reform, and continued macroeconomic stability in the face of external headwinds." Across Asia, Japan's Nikkei fell 0.33% while Hong Kong's Hang Seng added 0.18%. Nearer to home, Singapore's Straits Times dropped 0.23%. Reuters reported that Asian shares mostly tracked Wall Street stocks lower on Wednesday but dovish comments from Federal Reserve Chairman Ben Bernanke helped to limit their losses, lifting commodity prices, and putting pressure on the dollar. Chinese policymakers set the yuan's midpoint at the highest level since the 2005 revaluation, a day after China's central bank said it would gradually withdraw from regular intervention in the foreign exchange market. Investor focus is now moving to the minutes of the Fed's October policy meeting as well as a barrage of U.S. data, including retail sales and inflation, due later in the day.

https://theedgemalaysia.com/node/8685

HwangDBS: MAS stays fully valued

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HwangsDBS now forecast MAS suffering a FY09F core net loss of about RM1.3 billion from RM220 million profit previously. The research house maintained its fully valued rating and RM2.20 target price for the national carrier, saying that it was trading at 1.7 times price over book value (P/BV) (ex-mark to market) and 30 times CY2010F earnings per share (EPS) ex-exceptional item (EI) which was higher than its peers’ 16 times). The losses comprised RM565.1 million derivative losses and RM447.6 million premium paid on derivatives. HwangDBS said the premium paid was one-off related to the restructuring of the group’s fuel hedges. “Excluding the payment, MAS would have recorded RM346.6 million net loss in 1Q09. “MAS also registered 13.1 percentage points (ppts) year-on-year (y-o-y) drop in passenger load factor (to 56.1%) despite a 11% cut in capacity. Revenue per kilometre fell 28% y-o-y due to weak demand for air travel. Meanwhile, cargo load factor fell 0.4 ppts y-o-y to 64% in 1Q09 while yield plunged 24%. Both passenger and cargo segments were loss-making during the quarter,” added HwangsDBS. The research house’s target price of RM2.20 was based on 1.2 times FY10F P/BV (from 0.8 times), in line with peers average. The valuations are based on MAS’ BV excluding the impact from mark-to-market losses/gains (due to the adoption of FRS 139) for its fuel-hedging instruments. The research house said that these contracts were unrealised and would eventually be recognised; and thus had been factored this into its forecasts. MAS fell eight sen to close at RM3.18 yesterday. This article appeared in The Edge Financial Daily, June 16, 2009.

https://theedgemalaysia.com/node/80410

Maxis first telco to offer BlackBerry Z10 smartphone in Malaysia

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KUALA LUMPUR (March 11):  Maxis Bhd has launched the new BlackBerry Z10 smartphone powered by BlackBerry 10 in Malaysia. In a statement March 8, Maxis said the new BlackBerry Z10 will be introduced exclusively by Maxis and would be available at all Maxis Centres nationwide from March 9. Maxis chief executive officer Sandip Das said that BlackBerry had become an important fixture of corporate life for more than a decade. “In the past couple of years they have also caught the fancy of younger consumers particularly because of their applications. “The new BlackBerry Z10 is a watershed in the company’s history with its new operating system designed to reset standards in the terminal device arena,” he said. “At Maxis, we are glad to bring the new BlackBerry Z10 exclusively to our customers who have been waiting eagerly for this model. With a wide range of applications and Maxis special offerings, it is one thing to have a BlackBerry and quite another to get one with Maxis services on it!” Maxis said Hotlink was rewarding all its Prepaid BlackBerry customers with a special price of just RM1,888 for the new BlackBerry Z10, which comes together with 1.5GB of free data. It said this offer was valid from March 9 until April 30 this year. “Hotlink will also be giving its BlackBerry users a free 1-day BlackBerry Pass for them to stay connected online all day, only on March 8,” it said.  

https://theedgemalaysia.com/node/74147

M&A will shake out over two-thirds of glove makers

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KUALA LUMPUR: More than two- thirds of the existing 45 local glove manufacturers will be swallowed up by the big players in the next five years as the industry consolidates further, according to Supermax Corp Bhd executive chairman and group managing director Datuk Seri Stanley Thai. “Smaller companies without proper succession plan will be acquisition targets,” Thai said at yesterday’s investment briefing. He believes that the current 45 domestic players could shrink to only about eight on more mergers and acquisitions (M&A). However, Thai said Supermax does not have immediate acquisition plans. This is because of the hard lesson the company had learnt from the takeover of Seal Polymer Industries Bhd about five years ago. Thai is the single largest shareholder of Supermax, now the world’s third largest glove manufacturer after being displaced by the recent takeover of Latexx Partners Bhd by Semperit AG Holding. Thai and his spouse Datin Tan Bee Geok collectively hold a 35.57% stake in the company. Other glove manufacturers listed on Bursa Malaysia are Top Glove Corp Bhd, Hartalega Holdings Bhd, Kossan Rubber Industries Bhd and Adventa Bhd. On Supermax’s operations, Thai said the company is focusing on capacity expansion for growth. It is expanding its annual production capacity by 30% to 23.13 billion gloves by end-2013 from 17.76 billion presently. Thai: Smaller companies without proper su-ccession plan will be acquisition targets. The growth in capacity will be for nitrile glove production at the group’s two factories in Malaysia, he said. Supermax’s nitrile capacity will grow to 12 billion gloves a year by 2013 from 5.2 billion, according to Thai. The capacity expansion will help boost the company’s earnings next year. Thai did not elaborate but indicated the group is targeting a 20% net profit growth for the financial year ending Dec 31, 2012. Its cumulative nine-month net profit rose 15% to RM89.58 million from RM77.9 million a year ago. Revenue fell 3% to RM726.14 million from RM750.71 million. Supermax’s local production expansion involves the construction of two factories in Klang, Selangor, which involve a capital outlay of RM148 million. On overseas operations, Supermax is expanding its presence in South America. It plans to set up a manufacturing facility there to capitalise on the region’s duty-free status, thus making the company’s products more competitive. The company, via its Brazil unit Supermax Brasil Importadora S/A, is assessing the feasibility of establishing a new glove factory for processing, packaging and sterilisation of gloves. This article first appeared in The Edge Financial Daily, on Nov 29, 2012.

https://theedgemalaysia.com/node/6846

Assam Garam: Simply divine

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For that chocolate attack, head to Godiva for its mouth-watering truffles and treats Easter’s here and supermarket shelves are groaning under the weight of chocolate Easter eggs. It’s a funny tradition to be giving chocolate eggs, but it’s a tasty one. Chocolate has played a fun part in civilisation ever since the Aztecs and the Spanish sat down over a bowl of hot mole. The Spaniards brought chocolate back to Europe, where it went from savoury to sweet, from a food for aristocrats to one for the common man, from medicine to a soporific. By far the largest producers and consumers of chocolate are those in the English-speaking world: the Commonwealth and the US. But the best chocolates come from Europe. The Swiss and Belgians scoff at English chocolates as nothing more than table chocolate — the most damning thing one can say in the world of chocolate. The French, though, sniff at everybody else’s chocolates. They produce, arguably, the finest and tastiest chocolates in the world. Sadly, it is difficult to find a French brand in Malaysia. The Belgians have pretty much conquered the luxury chocolate space worldwide. In KL alone, we have Neuhaus, Leonidas and Godiva — some of the top names in Belgium. Brussels is filled with these chocolate stores. It boggles the mind how one city can support so many chocolate shops. Godiva chocolates, named after the legendary English woman who rode through Coventry naked on horseback to protest her husband’s cruelty, is a marvellous chocolate brand. It’s made in Belgium and shipped across weekly. The chocolates are then kept in cool containers, which are temperature-controlled even when the stores are shut. The delectable thing about chocolate is that it melts at body temperature, making it an exquisite, sensory experience. Naturally, this only happens with high-end chocolates like Godiva. Table chocolates tend to melt at a slightly higher temperature with a less sensual feel in the mouth. That is good chocolate’s magical secret.The thing about Godiva is that just about every little bite is superb. The chocolate — be it milk, dark or white — is smooth and has a wonderful “snap” when bitten into. It’s clear that the cocoa beans and dairy used to make these chocs are of the highest quality. The fillings used are fine and made of the best ingredients. And so it was a rainy Friday afternoon that SS and I went to Pavilion looking for a sugar high. It had been a long week and we needed a treat. What better way than to gorge on some chocolate. We headed to the Godiva store located in the walkway area of level two. An open concept store with tables, banquettes and servery, it sits smack in the middle of top-end labels like Bally, Prada and Gucci. Hence, it is right at home. I should warn you that this café does not serve any savoury food, it’s all chocolate and sugar. The chilled display unit in the front houses cakes and desserts. Next to it are the chocolate chillers with a dizzying array of truffles. Only a few of each are on show: air dries out good quality chocolate, making them crack and split. We took a table and from the menu we ordered a Chilli Hot Chocolate (RM19) for me. As odd as it may seem, chilli and chocolate is a combination older than sugar and chocolate. The Aztecs invented this recipe and is repeated in Mexican households to this day. To make our day, SS and I also ordered the Pistachio Macaroon (RM14), Dark Chocolate Tart with Ganache and Fresh Cream (RM17) and the Godiva house special: Dark Chocolate Cake. Just to balance things out, we ordered some decaf coffee (RM11). The Dark Chocolate Tart was amazing — it was filled with a very fine ganache (usually chocolate melted in cream and whipped) and layered with some more whipped cream. It was a total treat. The ganache was smooth and melted in the mouth. The sugar buzz was almost immediate. The Pistachio Macaroon was a lovely green, crisp on the outside and gooey in the middle just before you get to the chocolate filling. Pistachio and chocolate are a great combo, one found in many French pastries. But the best was the Godiva special. It was a slice of chocolate paradise on a plate: a layer of chocolate cake, dark chocolate ganache and milk chocolate mousse. One bite and you’re in heaven. We fought over this slice. The choice of truffles at Godiva is stunning. We ordered some and they came on white plates looking like little brown princes. At this point, I have to admit to disliking white chocolate. I don’t see why it’s even called chocolate as it has absolutely no cocoa mass whatsoever. Anyway, back to the truffles. These come in two price ranges: RM67 per 100g for the Truffles and RM56 per 100g for the Gold Collection. Whichever you choose, the quality is superb. My favourite was the Coeur Lait, a milk chocolate heart filled with hazelnut praline. Hazelnut and chocolate is another combination that appears frequently in cakes and pastries. Just think of Nutella and you get the idea. Next up was the Tourbillon 85. This I recommend only to those who like their chocolate dark and bitter: it’s a truffle filled with dark ganache made of 85% cocoa. It is superbly bitter. Fruit also plays a role with chocolate. Godiva has two truffles filled with fruit puree: Truffes Fruit Poire (Pear) and Abricot (Apricot). These are delicious — sensual and fresh. If you’re looking for something a little celebratory, there’s the foil-wrapped Raisin Fine Champagne: a dark chocolate truffle filled with champagne-soaked raisins. It won’t get you drunk, but it will make you giddy with delight. One of the simplest and tastiest truffles is the Truffe Fruit Cajou (gajus to you and me): a milk chocolate truffle filled with white chocolate and cashew puree and topped with cashew pieces. It is astonishingly good. If you’re looking for a simpler way to enjoy Godiva, get the carres — the little tablets of chocolate — from the light 50% to the intense 85%. But whichever you choose, you won’t go wrong in terms of quality. There are still more truffles to choose from. But be patient when you get to the café. The chocolates are so good that you need time to enjoy them. Bite them, nibble them, savour them. It’s easily the best way to spend a rainy afternoon. A keen art observer, Iqbal A R is a linguist by training but a chef at heart Godiva CaféLevel 2, Pavilion Kuala LumpurJalan Bukit BintangKLTel: (03) 2141 5252Opening hours: 10am to 10pm (daily) All Options food reviews are done incognito. Food reviews are subjective as they depend on the likes and dislikes of each writer. As they say, one man’s meat is another man’s poison. It’s best that readers try out the food reviewed here for themselves. — Editor This article appeared in Options, the lifestyle pullout of The Edge Malaysia, Issue 750, April 13-19, 2009  

https://theedgemalaysia.com/node/93381

Market Close: KLCI rises 0.4% to record high on China equity gains

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KUALA LUMPUR (July 23): The FBM KLCI rose 7.63 points or 0.4% to a new record close as Asian markets advanced. Regional equities had risen on gains in China's stock markets, according to analysts. At 5pm, the KLCI settled at 1,805.31 points, helped by gains in stocks like Malayan Banking Bhd and Public Bank Bhd. "The KLCI has its own dynamics. I expect it to move up in due course," Maybank Investment Bank Bhd vice president and retail research head for equity markets Lee Cheng Hooi told theedgemalaysia.com over telephone. The KLCI's record close today surpasses the previous all-time high of 1,797.74 points seen last Friday. According to Lee, Prime Minister Datuk Seri Najib Razak's call for government-linked entities such as the Employees Provident Fund to increase investments in mid-cap stocks across Bursa Malaysia has directed the spotlight on these entities. "Mid-cap stocks have taken the shine off blue-chip stocks," Lee said. Across Bursa Malaysia today, 1.42 billion shares worth RM2.25 billion changed hands. There were 415 gainers versus 392 decliners. The top gainer was British American Tobacco (M) Bhd while KPJ Healthcare Bhd warrants led decliners. The most-active entity was TDM Bhd. Asian stock markets rose. Japan's Nikkei climbed 0.82% while Hong Kong's Hang Seng gained 2.33%. China mainland's Shanghai and Shenzen Composite rose 1.95% and 2.76% respectively. Nearer to home, Singapore's Straits Times was up 0.6% Reuters reported that Asian stocks rose to six-week highs on Tuesday, led by a rally in Chinese shares, while gold took a breather after its biggest one-day gain in more than a year. Sentiment in China was boosted by separate media reports that the government would use railway projects to help cut gluts in steel, cement and other construction materials, and that Beijing would not permit economic growth to sink below 7 percent.

https://theedgemalaysia.com/node/82148

MATRADE: Malaysian firms can benefit from Brazil’s US$51b broadband plan

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KUALA LUMPUR (April 2): Malaysian firms could benefit from Brazil’s US$51 billion plan to expand its broadband connection with high speed networks, said Malaysia External Trade Development Corporation (MATRADE). In a statement Tuesday, MATRADE said that Brazil’s state-owned Telecommunication Brasil (TELEBRAS) aims to expand its broadband connection with high speed networks to allow high velocity broadband internet service. This is due to the limited internet service and few broadband options that are available in Brazil especially in rural areas and those outside major cities, whereby the average broadband speed that is available stands at less than 12 megabyte per second (mbps), it said. The installation involves of new broadband cable that will provide high speed internet services up to 100 megabytes for 50 million urban and 10 million rural household. “The project would involve investment by the private sectors as well as the government and is targeted to be completed in the next four years,” Malaysian Trade Commissioner in Sao Paolo, Yusram Yusuf said in a statement today. According to MATRADE, the project is expected to increase the import of ICT applications and services as the high spend networks require support in terms of technology and expertise. MATRADE also said that main components in the fibre optic broadband are such as fibre optic cable, connectors, adapter modules, adapter panels, cassettes, enclosures, patch cords, cable assemblies, cable distribution products and accessories. “Currently, Brazil imports most of its ICT applications while some components are produced locally,” Yusram added. The statement also noted that in 2012, Brazil importer over US$567 million (RM1.74 million) fibre optic adapters with the top exporters being China, absorbing 36% of Brazil’s total imports, followed by Germany, Japan, USA and Korea. “Malaysia’s export share of the product in 2012 represented 0.7% of Brazil’s total imports and Malaysia ranked the 15th largest exporter,” it said. In the same year, Brazil’s import value of fibre optic cable recorded over US$33 million with five top exporters were China, a 38% share of total imports, followed by USA, India, Mexico and Germany. Meanwhile, Malaysia ranked 29th largest exporter absorbing 0.18% of total imports of the product. Yusram also said that Malaysian companies should consider investing in Brazil’s ICT industry to take advantage of this project by leveraging with local ICT players. “Participation in trade shows is a good channel for Malaysian companies to showcase their expertise and quality products and the Brazilian FIEE exhibition is one of the main exhibitions to promote their products,” Yusram said in the press release today.Brazil to expand broadband connection, says Matrade  

https://theedgemalaysia.com/node/5171

Latitude Tree unit to raise S$7.9m from S’pore listing

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SHAH ALAM: The listing of Latitude Tree Holdings Bhd’s (LTHB) subsidiary Latitude Tree Pte Ltd (LTPL) on the Singapore bourse is expected to raise gross proceeds of some S$7.9 million (RM19.1 million). Funds from the flotation exercise, scheduled this August, will be used to expand the wood-based furniture manufacturer’s Vietnam operations. LTHB managing director Lin Tzu Keng said the money would finance the construction of a new warehouse, and acquisition of machinery in the Indochinese nation. “All these (S$7.9 million) will be for the Vietnam operations,” Lin told The Edge Financial Daily after the company’s EGM here yesterday. LTHB undertakes its Vietnam operations via Latitude Tree (Vietnam) Joint Stock Co which was originally intended to be listed on the Ho Chi Minh City Stock Exchange, according to filings to Bursa Malaysia in October 2007. However, in October 2008, LTHB said it planned to list LTPL on the Singapore bourse due to unfavourable conditions in the Vietnam stock market against the backdrop of the global economic downturn. To facilitate the flotation of LTPL, LTHB undertook an internal revamp to place its Vietnam operations under LTPL. The parent company also sold 24 million shares or 12% in LTPL to four individual shareholders for a collective sum of RM11.03 million. LTHB’s financials have not been spared in the current world economic turmoil. Net profit fell 15.6% in the second quarter ended Dec 31, 2008 to RM3.62 million from RM4.29 million a year earlier due to lower output in the company’s factories in Malaysia and Thailand. Revenue dipped 2.5% to RM111.49 million from RM114.3 million. However, cumulative six-month net profit grew 19.3% to RM6.06 million from RM5.08 million a year earlier while revenue was up 2.5% to RM221.94 million from RM216.56 million. In quarterly terms, revenue rose almost 1% from RM110.45 million in the preceding first quarter due to the strengthening of the US dollar against the ringgit. A stronger US dollar, essentially, translates into higher earnings for the firm when its US dollar-denominated exports are converted into the ringgit. LTHB is expected to announce its third quarter numbers today. This article appeared in The Edge Financial Daily, May 27, 2009.

https://theedgemalaysia.com/node/65541

Shale gas producers exposed to major supply chain risk due to guar bean dependency

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KUALA LUMPUR (July 10): The inherent dependency on guar gum by shale gas producers exposes them to major supply chain risks, said British risk and strategic consulting firm Maplecroft. In a report released Monday, Maplecroft said that shortages in guar beans, used in the hydraulic fracturing process to extract oil and gas from oil shale, also termed "fracking", had caused large hikes in prices in 2012. Reuters reported that as US producers purchased 22,000 tonnes of guar from India in March alone, prices for the commodity spiked causing trading in guar futures to halt in late March this year. As a result, oil and gas companies have seen their profits hit hard and are now seeking supply chain alternatives like direct farm contracts and man-made substances. Global production of guar is primarily dominated by India and Pakistan, which account for an estimated 80% and 15% respectively. Shale gas producers remain highly dependent on guar gum from these two regions, said Maplecroft, thus exposing it to country specific risk factors that may lead to legal and reputational risks for oil and gas companies in their bid to secure stable supplies. Risks within these two countries identified by Maplecroft include labour rights violations, endemic corruption, a lack of guar-specific regulation and environmental challenges. “A large proportion of the agricultural workforce in both countries is informal, falling outside the protective sphere of labour laws and social welfare regulations, and human and labour rights violations are widespread in the sector,” it said, raising special concern for bonded and child labour. According to the US Department of Labour, 69.3% of child labour in India occurs within the agricultural sector while there are approximately 10 million child labourers in Pakistan. Other concerns include low wages, poor health and safety standards, discrimination, restrictions on civil and political rights, and limitations on the right to bargain collectively. Maplecroft suggests that companies stringently monitor these to mitigate reputational risks associated with labour rights violations in the supply chain. "Reputational risks for shale gas companies are compounded by pervasive corruption at all levels of government in India and Pakistan, both of which are classified at 'extreme risk' in Maplecroft’s Corruption Risk Index," it said. It is said the guar suppliers are routinely exposed to demands for bribes for issuing export licenses, vehicle permits, tax receipts, and customs and excise clearances. "Complicity with bribery payments pose direct risks to oil and gas companies from legal repercussions under foreign legislation, such as the US Foreign Corrupt Practices Act or the UK Bribery Act." In Pakistan, agriculture is heavily dominated by politically connected families, raising great risk concerns. In India on the other hand, Rajasthan, India’s main guar-producing state, levels of corruption are far higher than national averages. It is not likely for the situation to improve anytime soon, said Maplecroft, advising companies to act to ensure conformity to international standards. India and Pakistan both also suffer an almost complete absence of guar-specific regulation at the production and processing end of the supply chain, thus increasing the unpredictability in quantity, quality, and price of the product. "Effective regulation across the guar supply chain is of vital importance for international buyers, due to its impact on the ultimate cost of guar products and the timing of their arrival to the market." In India, incoming legislation appears likely to open the commodities markets to foreign participation and halt the speculative trading that compounded price volatility early this year. However, on-going restrictions such as the prohibition of direct foreign investment in the agriculture sector will complicate and restrict supply chain options, it said. Maplecroft further identifies highly unpredictable environmental factors as a risk due to the fact that guar production in north western India and south eastern Pakistan is dependent on the performance of the monsoon. In 2000, 2002, 2004, 2007 and 2009, below average monsoon rainfall saw significant declines in guar production and sharp spikes in price. In the current season, concerns have been raised over production in Rajasthan due to the delayed onset in monsoon rains. "Furthermore, severe weather events linked to seasonal weather patterns, such as droughts or flooding are common and can inflict severe harm through key supply chain components," Maplecroft said.

https://theedgemalaysia.com/node/5556

Sanichi unable to find bumiputera investors

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In a statement yesterday, Sanichi said it was thus exempted from having to implement the special issue. “Despite several rounds of offer/ invitation extended to bumiputera investors to subscribe for the special issue shares, Miti (Ministry of International Trade and Industry) has not received any positive response,” it said. The Securities Commission had earlier granted the exemption subject to Miti confirming that the ministry was unable to allocate the special issue shares to buimputera investors by April 24. This article appeared in The Edge Financial Daily, May 21, 2009.

https://theedgemalaysia.com/node/84035

Destini to be lifted from PN17 tomorrow

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KUALA LUMPUR (April 22): Destini Bhd will be lifted from its Practice Note 17 (PN17) status tomorrow (April 23). In a statement to Bursa Malaysia today, Destini which offers maintenance, repair and overhaul services for the aviation and maritime sectors, said the exchange operator has approved the company's application for an upliftment from its PN17 status. "The company will be uplifted from being classified as a PN17 company effective 23 April 2013," said Destini which was formerly known as Satang Holdings Bhd. "With the completion of the regularisation plan, the company has regularised its financial condition and no longer triggers any of the criteria under Paragraph 2.1 ofPN1  of the Main Market Listing Requirements," Destini said Destini which became PN17 entity since May 2008 had undertaken a regularisation scheme to rejuvenate its financials. The scheme which included a capital reduction and rights issue was completed in September 2012. Destini has indicated it would apply to Bursa Malaysia for the uplift of the former from its PN17 status. This comes with the condition that Destini registers a net profit for two consecutive quarters immediately after the completion and implementation of the restructuring scheme.

https://theedgemalaysia.com/node/35438

FBM KLCI advances in early trade

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KUALA LUMPUR: The FBM KLCI extended its gains on Wednesday, Aug 18 and was up 5.06 points to 1,383.53 at 9.05am, lifted by gains including at Genting Malaysia, Maxis and CIMB. Volume was 44.52 million shares valued at RM38.63 million. MBM Resources was the top gainer and was up 18 sen to RM3.34, LPI Capital and Yee Lee added 16 sen each to RM17.80 and RM3.50 respectively, Maxis up 15 sen to RM5.44, KFCH and Ta Ann added 10 sen each to RM10.76 and RM5.69 respectively, while MPI and CIMB rose nine sen each to RM5.99 and RM7.48 respectively. Genting Malaysia was among the most actively traded stocks, and was up eight sen to RM3.07 with 1.99 million shares done.

https://theedgemalaysia.com/node/43789

Options: People & Places-- A bejewelled affair

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Homegrown jeweller Poh Kong celebrates 35 years and the launch of its latest gallery To celebrate the Christmas season, the centre court of Pavilion KL, the city’s hottest retail playground, was decked out magnificently to look like a winter wonderland. A delightful cornucopia of colours and activity, with excited children and adults, it seemed impossible for Pavilion KL to get any more festive. And yet it did, thanks to Poh Kong Jewellers. The 35-year-old Malaysian jewellery brand celebrated two important occasions recently — the launch of the new Poh Kong Gallery in Pavilion KL and a campaign to celebrate the brand’s 35th anniversary. Held just days before ushering in the new year, Poh Kong’s grand celebrations also coincided with another key event in its calendar — the Miss Poh Kong Glamour 2010 contest, a subsidiary title under the Miss Tourism International pageant that Poh Kong has been organising since 2003. Pavilion KL’s centre concourse was drenched in gold, while its grand staircase was covered in a bright red carpet, setting the tone for a lavish and classy affair. Trays of champagne flutes and canapés were expertly manoeuvred by waiters among Poh Kong’s guests, all dressed to the nines in cocktail dresses and suits, and of course, decked out in beautiful and glittery jewellery. Holding court was Poh Kong Holdings executive chairman and group managing director Datuk Eddie Choon. After a parade of 53 international beauties, all of whom were frosted with various pieces of jewellery from Poh Kong’s immense collection, the winner was announced — Miss Bolivia, Silvia Maria Wende Morant. This was followed by the unveiling of the new logo and campaign for Poh Kong’s 35th anniversary to the excited crowd. The campaign, which runs until Aug 31, is the first of its kind by the brand. Upon the purchase of diamonds and other gems worth RM350 at any Poh Kong outlet, buyers will receive a RM35 cash voucher for their next buy. It’s a rare occasion that a jeweller offers a deal like this to its customers, even more so a brand like Poh Kong. “This is a part of our customer reward programme in conjunction with our anniversary celebration to thank our customers for supporting us all these years,” Choon explains. “Without them, we would not have become one of the most established and trusted brands in Malaysia.” After an energetic performance by violinist extraordinaire Dr Joanne Yeoh, guests were escorted to the new Poh Kong Gallery. This is the brand’s second gallery; the flagship gallery located at Poh Kong’s Petaling Jaya headquarters was established in 2004, to cater for the increasingly sophisticated tastes of its customers. The gallery is a wonderful addition to Poh Kong’s list of outlets as it offers customers an alternative retail experience. Many people enjoy the camaraderie and cacophony of traditional goldsmith shops, which Poh Kong also provides (a traditional Poh Kong outlet is also located in Pavilion KL as well as on the lower floor of the brand’s headquarters). But for customers who are looking for a more sophisticated product offering and a more luxurious shopping experience, the gallery is ideal. Both Poh Kong galleries carry renowned international brands such as German pearl experts Schoeffel and Italian jewellers Luca Carati and Alessandro Fanfani, as well as Poh Kong’s own unique collection of extraordinary diamonds and gems. Following the success and popularity of its first gallery, the jeweller has taken the gallery concept into a shopping mall for the first time. But unlike the flagship gallery in Petaling Jaya, which is designed more like a winding labyrinth marked by an array of jewellery displays, Pavilion KL’s gallery is more structured. It is designed almost like a watch shop — each brand is contained in glass display cases against the wall while the floor space is anchored by Poh Kong’s own selection of diamond and precious stone jewellery. The simple layout works equally well for loyal customers of Poh Kong as well as new, walk-in buyers. Of course, Poh Kong continues to live up to its reputation of having some of the most attentive and knowledgeable staff in the industry — whether you are a novice buyer of jewellery or an expert, you are sure to be in good company indeed. Snapshot Love was certainly in the air in December last year as the world’s ultimate playboy, Hugh Hefner, chose to end his bachelorhood in style. The distinguished looking Hefner bade goodbye to 2010 as playmate and girlfriend Crystal Harris become his fiancée on Christmas Day. Harris is just 24, a whopping 60 years younger than the 84-year-old Playboy magazine founder. Theirs was not the only engagement news to hit Hollywood in the romantic winter season: Natalie Portman, Reese Witherspoon, Bret Michaels, Leann Rimes, Jason Mraz, Shania Twain and Ginnifer Goodwin all announced their engagements in December. Twain married Swiss businessman Frédéric Thiébaud on New Year’s Day. Magnificent mark Montblanc marked the official opening of its largest and most prestigious boutique in Southeast Asia at the Mandarin Gallery in Singapore with the unveiling of the first completed piece of the Montblanc ExoTourbillon Chronographe. Located in the prominent shopping belt of Orchard Road, the Montblanc Mandarin Gallery boutique is a luxurious duplex, measuring a total of 5,000 sq ft, and it is only one of two Montblanc boutiques worldwide to feature a 4m-high art installation comprising over 600,000 Swarovski crystals carved into individually curved glass panels and framed as a chandelier. CEO of Montblanc International Lutz Bethge, president and CEO of Montblanc Asia Pacific James Siano, managing director of Montblanc Asia Pacific Catherine Ang and award-winning Korean actor Oh Ji Ho hosted the lavish event. Part of the Villeret 1958 collection, the unique ExoTourbillon Chronographe combines both a chronograph and a tourbillon — making it one of the most progressive and functional timepieces in the world of haute horlogerie. This watch is limited to just 17 pieces worldwide — eight in red gold, eight in white gold and a single one in platinum. Apart from the watch, also on display were several museum pieces from Institut Minerva de Recherche en Haute Horlogerie. At the opening, guests were able to get up close and personal with a lithographer and two watchmakers from the institute. Montblanc’s beautiful new boutique is located at 01-01, Mandarin Gallery, 333A Orchard Road, Singapore. This article appeared in Options, the lifestyle pullout of The Edge Malaysia, Issue 840, Jan 10-16,

https://theedgemalaysia.com/node/34087

#Updated* MISC to offer 25% of MMHE shares for sale under IPO

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KUALA LUMPUR: MISC Bhd's proposed listing of its unit Malaysia Marine and Heavy Engineering Holdings Bhd  (MMHE) will involve offering 25% or 408 million shares of the enlarged paid-up of 1.6 billion shares. MISC said on Friday, July 23 the listing vehicle would be MSE Holdings Bhd (MHB), which holds 100% of MMHE.  It said the listing exercise would involve  the sub-division of the MHB's existing paid-up of RM16.22 million, comprising of 16.22 million RM1 shares, into 50 sen shares of 32.44 million. The proposed listing is expected to be completed by the fourth quarter of 2010. The listing exercise will see MHB declaring a cash dividend payout of RM300 million to MISC via dividend income received from MMHE. After the proposed dividend, MHB would undertake a bonus issue involving the issuance of 1.30 billion new shares on the basis of about 40.245 bonus shares for every one MHB share. The bonus shares shall be issued as fully paid-up shares by capitalising RM652.78 million of MHB's retained earnings, after including the proposed interim dividends to be declared by MMHE to MHB of RM655,000,000 which will increase MHB's retained earnings to RM654.79 million to enable the implementation of the bonus issue. To recap, MHB's core businesses are engineering and construction, marine conversion and marine repair, which are split into the engineering and construction segment and the marine conversion and marine repair segment. It posted net profit of RM279.20 million in the first quarter ended March 31, 2010 on the back of RM6.14 billion in revenue. Its net assets were 1.21 billion and net asset per existing share was 74.79 sen. MISC's original investment in MHB from Oct 11, 1991 to Jan 14, 2008 was RM303.84 million.   IPO details The proposed IPO would see MISC offering 146 million MHB shares, or 9.12% of the enlarged paid-up share capital to Malaysian institutional and selected investors, and foreign institutional and selected investors outside the US. The offer price would be done via a book building. MHB would undertake a public issue of 262 million new MHB shares, representing about 16.38% of the enlarged paid-up share capital of MHB. Bumiputera offering Of the 262 million new MHB shares, it would offer 184 million shares, or 11.50% of the enlarged paid-up share capital of MHB to Bumiputera institutional and selected investors at the institutional price. Retail offering Under the retail offering of  78 million shares, or 4.88% of the enlarged paid-up share capital, it said 24 million shares would be offered to MISC shareholders, another 32 million offered to the public (of which 16 million shares are set aside for Bumiputera individuals, companies, co-operatives, societies and institutions), Allocation to eligible directors It was allocating 22 million shares for the eligible directors and employees of MHB, its subsidiaries and jointly controlled companies as well as the eligible directors and employees of MISC and selected subsidiaries of MISC. Of the 22 million shares, about 152,000 shares would be reserved for all the directors of MHB, all the directors of MISC and the directors of MISC's selected subsidiaries. The outstanding 21.848 million shares would be reserved for about 9,000 eligible employees of the MHB Group, MISC and selected subsidiaries of MISC, who have been confirmed employees since Aug 31, 2010 and have not submitted their resignation as at Aug 31, 2010. The final issue price per issue share will be equivalent to the issue price or 95% of the institutional price, whichever is lower, to be determined on the price determination date. Utilisation of proceeds by MHB Proceeds raised from the listing exercise will accrue entirely to MHB and used for  MHB's yard optimisation programme in Pasir Gudang, capital expenditure in Turkmenistan and to defray the listing expenses. It said the yard optimization programme started in 2006 and is expected to be completed by first half of2014. "The total estimated cost and the working capital of the yard optimisation programme is RM2.72 billion, where, as at June 30, 2010, MHB have already invested about RM548.0 million," it said. The funds would be for partial payment of earthwork on the land, construction of pier, workshops and new facilities among others. "As the works progress, the onward expenditures will be funded from the listing proceeds and internally generated funds and/or borrowings," it said. MHB said the future infrastructure upgrading works under the yard optimisation programme include, among others, automation and construction of specialised enclosed work areas, construction of 25,000 tonnes bulkheads and skid-track and concreting of fabrication areas, enlargement of existing dry-dock and installation of new facilities as well as acquisition and installation of cranes, block transportation dolly and mechanical and engineering utilities. It added the increased activities in Turkmenistan require additional capital expenditure for the purchase of movable heavy equipment such as cranes, welding machine and ancillaries, trucks, fork-lift and prime movers, portable air-compressor, quality control facilities and testing and commissioning equipment.

https://theedgemalaysia.com/node/22914

MRCB getting ready for a big job

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Companies usually raise funds after they have secured a major project or after their share price has rallied following an announcement of their being awarded a major project. Kumpulan Jetson Bhd, which has been one of the most active stocks in recent months, is undertaking a placement at a premium to its average share price three months ago. The company’s shares have been rising on talk that it could benefit from a privatisation project by the Malaysian External Trade Development Corporation. When shares are issued after their prices have risen on new developments or speculation, companies may be able to raise the capital they require by issuing fewer new shares via a rights issue or placement. It would be better if a company raised funds after it had secured a project, like in the case of Genting Singapore plc, which embarked on several fundraising exercises to finance its integrated resort project in the island republic. As the take-up rates enjoyed by Genting Singapore show, shareholders tend to be more confident about forking out money when they know the company has a major project in hand rather than reacting negatively to the cash call by selling shares on the market. On Nov 6, Malaysian Resources Corp Bhd (MRCB) announced that the group was undertaking a rights issue to raise RM566 million but it did not state clearly how the proceeds will be used except to say a portion will be utilised to finance its retail mall project Nu Sentral Mall. “The funds are for generic investment and working capital purposes and we need them to buy long-term assets and new landbank for development. They are for new acquisitions that we plan to do later,” says group managing director Shahril Ridza Ridzuan. It was reported that MRCB plans to undertake its biggest development project ever in the Klang Valley by early next year. The group will use part of the proceeds to buy land for the purpose. However, the location of the mega project remains unknown, although rumours are rife that MRCB, together with the Employees Provident Fund (EPF), is slated to redevelop government land in Jalan Cochrane, Kuala Lumpur, and possibly in Jalan Ampang Hilir.Shahril is confident that the shareholders will be in sync with the company on the fundraising. “We will make an announcement later on how the rest of the proceeds will be utilised,” Shahril tells The Edge. He says rights issues are the better funding method because the funds will be utilised for long-term rather than short-term projects. “For funding purposes, it does not make sense to raise short-term debts to acquire long-term assets for development,” he adds. Analysts describe the renounceable rights issue — on a ratio of one rights share for every two held — as a surprise. “We were taken aback by MRCB’s decision to go with a rights issue as we had expected the group to opt for bonds or a share placement,” CIMB Research says in a note. Of the RM566 million raised, RM380 million is earmarked for the future expansion of MRCB’s property and construction businesses, RM85 million for equity investment in the 7-storey Nu Sentral Mall in KL Sentral that is jointly managed with Pelaburan Hartanah Bhd, and RM93 million for working capital. Shahril says that part of the proceeds will go to MRCB’s 100%-owned Eastern Dispersal Link project in Johor Baru. Construction started in 2007 and it is expected to be completed in 2011. The total investment of about RM800 million for the retail mall will be funded via a combination of equity contributions and bank borrowings. To date, MRCB has invested about RM38 million in the mall, funded via working capital and bank borrowings. The mall is to be completed by 2012. “We have a number of project acquisitions in the pipeline and at various stages of discussion. We expect to close the rights issue by next year, so the funds available are for us to utilise next year,” says Shahril. He adds that the company is looking at various deals right now, involving not only the acquisition of landbank but also the expansion of services and capacity. On the redevelopment of government land in Jalan Cochrane and Jalan Ampang Hilir, Shahril says, “There is no award in respect of any government land. So, just wait for the announcement.” Under the proposed rights issue, the EPF, which currently holds a 30.6% stake in MRCB, will be obliged to undertake a mandatory general offer should it subscribe for the excess shares and end up with more than 33% of the company. However, the EPF is likely to seek a waiver as it wants to keep MRCB listed. RHB Research says the whole idea of getting the EPF involved is to allow it to play a more prominent role in the real economy of the country and not just be a passive equity and bond investor. If MRCB gets the deal to redevelop government land in Jalan Cochrane, it would be a major income generator for the company which, over the past 15 years, has been associated with the redevelopment of the old railway land along Jalan Brickfields that is now KL Sentral. Apart from KL Sentral, MRCB is said to be in the running for some small jobs in relation to the Bakun Hydroelectric Dam and the extension of the light rail transit project. But the competition for these projects is keen, so margins will be narrow and stretched over several years. However, the redevelopment of the Jalan Cochrane land will give the company recurring income for probably another 15 years. This will complement its existing assets with recurring income, such as the Duke Highway and several parcels of land in KL Sentral. MRCB has called for a rights issue in anticipation of securing the government land, which is not necessarily a bad move as all the shareholders have a chance to buy additional shares cheap. The only downside is the dilutive effect. But then again, this applies only to those who do not subscribe for the rights shares. This article appeared in Corporate page of The Edge Malaysia, Issue 781, Nov 16-22, 2009.

https://theedgemalaysia.com/node/41128

US-based National Instruments to invest US$80m in Penang

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GEORGE TOWN: US-based National Instruments (NI), which is investing US$80 million (RM252 million) to set up a production facility in Penang, hopes to generate US$1 billion in revenue from its operations here by 2016. “Penang will be our hub for Asia which in 1994 was only 9% of our market, but today it is at 30%. By 2015, Asia will surpass North America with 50% of our market share coming from here,” said NI chief financial officer Alex Davern, who is also the chief operating officer and executive vice-president. Davern said NI’s facility in Penang would be the second-largest operation after its headquarters in Austin, Texas, overtaking its other facility in Hungary, Europe, by 2015 or later. In an interview with The Edge Financial Daily, Davern said the operations in Penang, which include research and development (R&D), IT, finance and manufacturing, would be the core location for revenue in Asia in the next five years. NI will employ 1,500 workers over the next five years out of whom 50% will be graduate employees, with 300 involved in R&D, and the rest in manufacturing, product development, IT and finance. Currently, there is a 35-strong team consisting of mostly engineers in its operations in Penang. Already, the pioneering team of 10 R&D engineers have successfully developed the first embedded PXI controller, an instrumentation platform which will be produced in the first quarter of 2011 at the facility in Hungary. Once the Penang facility is ready, production will be transferred to the island.Right now, 90% of the production is carried out in Hungary and this will be replicated in Penang by 2012. He said work on its 17-acre manufacturing and R&D facility in Bayan Lepas would start in the first quarter of 2011 and to be completed in the first quarter of 2012. NI, a Fortune 100 company which has been on the list consecutively for 11 years, has 5,300 employees worldwide, with R&D teams in nine countries and sales representation in 50 countries. It was also named as one of the best 14 companies in the US to launch a career path. With a client base of 30,000 companies worldwide, NI develops and manufactures software and hardware products which engineers and scientists use in embedded design applications. Speaking at the official opening of NI’s office at the SunTech building by Chief Minister Lim Guan Eng, Davern said Penang was chosen for its talented workforce. Also present was NI Penang MD Raj Purushothaman and Asean managing director Chandran Nair. “We visited other states and many countries before we decided on Penang which has a huge pool of highly talented workforce and we have already witnessed their capabilities. “I wish we had come here earlier, five or six years ago. “We are impressed with the standard of education, commendable command of English besides the investment-friendly atmosphere and Penang’s long-term track record of success in manufacturing and the ready-made supply chain which is already in place. “Most important, it is Penang’s talent force that influenced NI’s decision to come here,” he added. Davern said NI was not looking to set up low-cost manufacturing here in Malaysia but was keen to stay long term. “We are trying to build a real company here and we are not delegating tasks from the US but we will build the operations here to give employees a life-time career path and we believe in making work fun and not just only work,” he added. This article appeared in The Edge Financial Daily, December 3, 2010.

https://theedgemalaysia.com/node/76431

#Hot Stock* Alam Maritim starts year 7.4% higher on dividend hopes

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KUALA LUMPUR (Jan 2) : Offshore support services provider Alam Maritim Resources Bhd's share price increased five sen or 7.35% to 73 sen on active trading of 9.87 million shares as at 3.33 pm today. The stock has been on an upward trend since reaching its 12-month low of 49.5 sen on Aug 13, 2012. Since then, the stock has increased 47.5%. The group recorded a profit of RM39 million in the nine months ended Sept 30, 2012 -- an increase of RM25.3 million, which was more than double the RM13.6 million in the previous corresponding period. Despite making a big profit, Alam Maritim did not declare any dividends for the financial year ended Dec 31, 2012 (FY12). The last time it had done so was in FY09, with a 3.8 sen per share dividend. Analysts expect Alam Maritim's board of directors to declare a dividend of up to six sen per share this year. The company's recovery from losses in 2010 was due to improvements in its offshore support vessel (OSV) business, while its offshore installation and construction (OIC) division continued to turn around, the analysts said. "Revenue grew 53.3% y-o-y, underpinned by stronger contributions from its OIC business (supported by the company’s current OIC contracts with Sabah Oil & Gas Terminal and Samsung Engineering Malaysia). "Meanwhile, net profit soared 185.7% y-o-y, mainly due to improving charter rates and an increase in the share of profits from its associates and jointly controlled entities," noted Danny Chan, an analyst with OSK Research.

https://theedgemalaysia.com/node/12686

More retirees withdrawing EPF savings in instalments, ad hoc basis

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In a statement, EPF said the EPF Flexible Age 55 Withdrawals rose substantially in its take-up rate in the second quarter of 2009 (2Q09), rising by 105.45% from a year earlier, as concerns among members over income inadequacy during retirement became more prevalent. It said that in 2Q09, a total of 13,533 applications (1Q09: 9,731) were approved for the Flexible Age 55 Withdrawals, an increase from 6,587 applications in 2Q08. EPF said the total withdrawn amounted to RM705.89 million (1Q09: RM505.94 million) compared with RM387.14 million in 2Q08. "The increase in Flexible Age 55 Withdrawals demonstrates enhanced awareness among members that lump sum withdrawal may lead to inadequate funds during their retirement," said EPF chief executive officer Tan Sri Azlan Zainol. He added that the EPF made the right move when it introduced the product under the Beyond Savings strategic initiative in 2007. Flexible Age 55 Withdrawals offers members the option to receive their EPF savings in instalments or on an ad hoc basis which will help members better manage their retirement savings and stretch them over a longer period. However, EPF said Lump Sum Age 55 Withdrawals remained the preferred option for members upon reaching age 55. In 2Q09, a total of 39,901 applications for this withdrawal (1Q09: 35,640) were approved, an increase of 22.67% from 32,526 approved applications in 2Q08. The total amount withdrawn in 2Q09 was RM1,807.01 million (1Q09: RM1,621.15 million) compared with RM1,361.00 million in 2Q08.

https://theedgemalaysia.com/node/31113

RAM Ratings reaffirms Aeon Credit’s RM400m debt notes

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KUALA LUMPUR: RAM Rating Services Bhd has reaffirmed the enhanced long-term rating of AA1(bg) for Aeon Credit Service (M) Bhd’s RM400 million debt notes with a stable outlook. It said on Wednesday, June 2 the enhanced long-term rating of the company's conventional and Islamic commercial papers/medium-term notes (CP/MTN) programme, reflects the strength of the unconditional and irrevocable guarantee extended by three banks. The banks are Bank of Tokyo Mitsubishi UFJ Ltd, Mizuho Corporate Bank Ltd, and Malayan Banking Bhd, based on the weakest-link approach. At the same time, the short-term rating of the conventional and Islamic CP/MTN programme was also reaffirmed at P1. RAM Ratings said Aeon Credit provides easy-payment schemes and personal financing as well as the issuance of credit cards. It is one of the largest non-bank players in the Malaysian consumer-financing industry; it is estimated to capture the biggest share of the domestic motorcycle-financing market. Meanwhile, Aeon Credit Service Co Ltd of Japan - through its 56.7%-interest in AEON Credit - continues to play a crucial role in the Company’s business direction and strategies. "Aeon Credit’s lending exposure to the low-to-medium-income segment, although through a vast base of customers with small loan amounts, exposes the company to relatively higher credit risk," it said. This was based on the comparison with commercial banks as the debt-servicing capabilities of the individuals were often more susceptible to adverse changes in economic conditions. Amid the recent recession, the ratios of both the company’s newly classified non-performing loans (NPLs) and loan-loss expenses against its average gross loans inched up to 5.4% as at end-FY Feb 2010 (end-FY Feb 2009: 4.1% and 4.3%). "That said, Aeon Credit’s lucrative net interest margin of 18.7% in FY Feb 2010 provides a strong buffer to absorb credit costs (FY Feb 2009: 19.6%). Overall, the Company’s asset quality is still deemed healthy, albeit slightly weaker in FY Feb 2010. Going forward, Aeon Credit’s rate of NPL formation is anticipated to moderate as the economic recovery gains traction," it said.

https://theedgemalaysia.com/node/65184

Maintaining global bond strategy

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Generally speaking, the current events in Europe do not change our medium-term investment thesis. Our views regarding areas that investors have been concerned about, and how we are dealing with market volatility, are summarised below. Greece Greek voters narrowly endorsed pro-bailout forces in a momentous election, easing fears of an imminent rupture with the eurozone. However, we think more work needs to be done and we expect volatile periods should markets panic in the short term while the scenario in Greece continues to play out. We are likely to view short-term volatility as an opportunity. In our opinion, the combination of a large war chest to stem pressures in the short term and fiscal and reform commitments over the long term should ring-fence the eurozone from financial fallout from Greece. Spain and Italy We believe current proposals for labour reform and deregulation in Spain and Italy should help support long-term growth, and while implementation and results are likely to take time, important first steps have been taken. Additionally, recently adopted, prudent fiscal packages in Spain and Italy can help stabilise their long-term debt dynamics, in our opinion. FranceWe do not believe France’s newly elected president, Francois Hollande, should differ as significantly in terms of policy goals as he portrayed before the elections. While there was a lot of political rhetoric during the campaign, in terms of actual fiscal policy, Hollande has only proposed shifting forward the plan to bring the country’s deficit into balance by one year. Austerity versus growth The debate has been framed thus far as austerity versus growth, which is incorrect, in our view. We believe it needs to be austerity and growth. There is no getting around controlling finances, which means some form of austerity. Over the medium term, it is unavoidable that government indebtedness needs to be capped and brought under control. For growth, structural reform is the essential component, in our opinion. European fiscal union We believe it is important that Germany and France continue to take the lead in setting up a fiscal union. It is also likely to require some political compromise. Germany is probably not going to get all the austerity it wants, while the countries receiving fiscal transfers are probably going to give up more national sovereignty than they would like. Ultimately, however, we think an agreement to hard rules about long-term financing needs to be put in place for the euro to survive, and we find it encouraging that the current discussion has acknowledged this reality. Strategy We are doing what we have always done and we have no plans to change course. Our investment discipline employs a fundamental, research-driven process that focuses on the long term. Probably today more than ever, we think it is the only way to get through periods of volatility. Additionally, we are fortunate to have a huge global footprint of resources, which includes a solid and diverse research team, and so we have a hands-on approach to understanding the fundamentals in each individual country. Dr Michael Hasenstab is senior vice-president, portfolio manager and co-director of the International Bond Department at Franklin Templeton Fixed Income Group. This article appeared on The Edge Financial Daily July 3, 2012.

https://theedgemalaysia.com/node/90238

Market Close: KLCI rises 0.4% on US, Budget and UMNO

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KUALA LUMPUR (Oct 7): FBM KLCI rose 0.4% at market close, riding on optimism of a US debt ceiling breakthrough and injection of new blood into UMNO in the coming party elections. At 5.00 pm, the benchmark KLCI was at 1791.37 points, up 6.61 points or 0.37%, after hitting a high of 1795.48. It rose on gains from major stocks such as Felda Global Ventures Holdings Bhd and RHB Capital Bhd. M&A Securities head of research Rosnani Rasul said investors believe there would be settlement to US debt crisis. Besides the optimism of a US debt ceiling breakthrough, other factors affecting the equities market are the sentiment surrounding the upcoming Budget 2014 and the country’s pre-Umno election rally. She explained that investors are optimistic that there could be some form of subsidy rationalisation in the soon-to-be announced budget that would see the government address the prices of electricity and gas. Rosnani also pointed out that the emergence of new blood running for positions in the coming UMNO elections also signifies a new generation of leaders in the government.    Today, Bursa Malaysia saw 1.62 billion shares worth RM1.89 billion changing hands. There were 395 gainers versus 374 decliners. The top gainer was Petronas Dagangan Bhd while the top decliner was Aeon Credit Service (M) Bhd. The most-active entity was Malaysian Airline System Bhd. Across Asia, Japan’s Nikkei rose 0.18% while Hong Kong’s Hang Seng fell 0.46%.  Nearer to home, Singapore Straits Times rose 0.24%. Reuters reported that Asian stocks marked time on Wednesday with nervous investors praying that frantic talks in Washington to avert a US debt default could lead to a deal before the October 17 deadline, after which the government would run out of ways to borrow. US Senate aides said an agreement to lift the government's US$16.7 trillion borrowing limit was near but details still needed to be worked out, leaving markets clinging to hopes that an announcement will be made later on Wednesday. If Washington does not reach a deal by October 17, the government will by law no longer be able to add to the national debt, and will have to rely on incoming revenue and about US$30 billion in cash to pay the nation's many obligations. That money is expected to run out quickly and Washington would start missing payments in the weeks ahead. A global financial crisis could follow if investors decide that US debt, used as collateral for trillions of dollars in financial deals, no longer provided adequate security.

https://theedgemalaysia.com/node/12644

Hong Kong shares have worst day in 1-1/2 years, Lenovo crumbles

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(Feb 4): Hong Kong shares suffered their biggest daily tumble in nearly 1-1/2 years in strong volumes, with Chinese growth-sensitive sectors sliding as investors returned on Tuesday from the Lunar New Year holiday, catching up with losses elsewhere. The Hang Seng Index ended down 2.9 percent at 21,397.8 points in its biggest single-day loss since July 23, 2012. The China Enterprises Index of the top Chinese listings in Hong Kong dived 3.1 percent to 9,509.7 points. Losses on Tuesday left both benchmarks just hovering above technical support at levels last seen in July and August at around 21,300 for the Hang Seng benchmark and 9,400 for the H-share index. Turnover faded after a robust morning session, with a good portion coming for Lenovo Group alone as its shares plunged 16.4 percent in its biggest one-day decline since January 2009. A series of brokers downgraded Lenovo's shares on fears recent deals would dilute earnings amid reports of another joint venture with Sony. Lenovo declined to comment on the report, while Sony said it was "inaccurate". - Reuters

https://theedgemalaysia.com/node/16755

Message from Nicklaus's wife helped inspire Watson

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TURNBERRY: A text message from Jack Nicklaus' wife helped inspire 59-year-old Tom Watson to grab a shock lead early in the British Open first round on Thursday. "There is something slightly spiritual about today," the veteran American told reporters after a 5-under 65 put him one shot ahead of the field. "I received a text yesterday from Barbara Nicklaus. "She wished me good luck and I texted her back and said: 'We really miss you over here', and I really meant it. It's not the same without Jack playing in the tournament." The eight-time major champion and his good friend Nicklaus were involved in the famous 1977 Duel in the Sun at Turnberry, a thrilling head-to-head won by Watson. Asked if his 65 could propel him to another British Open title at the same venue 32 years later, Watson replied: "The quick answer is yes... I feel I'm playing well enough to win." Given more time to reflect, he said: "How am I going to do the next three rounds? I don't know, don't have a clue. "I wish I could tell you I'm going to break the Open record and shoot 262 but we'll just see." Watson turned back the clock to the time when he claimed five British Open victories by notching five birdies in a flawless round, the highlight a 20-foot putt that disappeared into the cup at the par-four third. Nicklaus, now 69, said a few years ago he no longer wanted to simply make up the numbers in the major championships. "I concur with Jack," said Watson. "I don't want to be a ceremonial golfer. When R&A chief executive Peter Dawson told me about the 60-year age limit for this tournament I said: 'Peter, that's a sensible decision'. "I think there's a certain age limit, you've got to let the younger kids play." For now, though, Watson says he still has what it takes to lift the coveted Claret Jug. "I feel as if I can compete against the kids," he said. "Being a ceremonial golfer is when you feel like you can't compete. "I'm a ceremonial golfer at the US Masters, I can tell you that, (but) I can still beat this golf course somehow. "It would be amazing (to win). You can put all kinds of superlative adjectives to it but I don't think about it, it's one of those things that will happen if it happens." — Reuters

https://theedgemalaysia.com/node/11594

CCB extends gains on dividend plan

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At 9.17am, CCB shares rose 22 sen to RM3.92 with 114,000 shares done. The FBM KLCI was just slightly higher by 0.71 point to 1,175.61. Turnover was 74.44 million shares done valued at RM68.64 million. Last Thursday, it declared a special dividend of RM1.20 per share and an interim dividend of five sen per share for the second quarter ended June 30. Net profit fell 63.6% to RM19.89 million from RM29.97 million a year ago. Revenue was RM123.8 million versus RM154.04 million a year ago. Earnings per share were 10.82 sen versus 29.75 sen.

https://theedgemalaysia.com/node/62452

#Focus* Sime Darby's fair value lowered after 1Q results, bleak outlook

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KUALA LUMPUR (Dec 2): Conglomerate Sime Darby Bhd's fair value was lowered by at least two research houses today after it reported weaker results in its first quarter and expressed bleak outlook for most divisions in the group. Last Friday, Sime Dary said its net profit for the first quarter to September 2013 plunged 51% year on year to RM489 million. It cut its headline KPI for current financial year to RM2.8 billion (net profit), from RM3.2 billion in 2012/2013 year. In a note this morning, RHB Research reduced Sime Darby's fair value (FV) to RM10.46, from RM10.73, though it maintains its "buy" call on the company. The research house said it maintains its BUY recommendation for now with an upward bias in crude palm oil (CPO) price assumptions. “Sime Darby’s 1QFY was below our and consensus estimates, coming in at 13-14% of both FY14 forecasts. The main variance was in the weaker earnings contribution from the plantation and motor divisions,” it said in the note. RHB has also lowered its forecasts for the company by 8.5% for FY14 and 1.7% for FY15. Similarly, AmResearch, though maintaining its "buy" call on Sime Darby, has lowered its FV to RM11.20 from RM12.45 per share. The research house commented that the 1QFY14 core net profit of RM499.7 million was below their expectations. The profit only accounted for 14% of the consensus full year forecasts. “The group has unveiled its internal KPI target of achieving a net profit of RM2.8 billion on the back of a return on average shareholders fund of 10%. We maintain our numbers for now,” it said in the note. In morning trades today, Sime Darby's share price fell slightly from its Friday's close of RM9.64.

https://theedgemalaysia.com/node/80314

Highlight: We have nothing to hide, says EC

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TODAY marks five years since the March 8, 2008 general election, which has been described as a turning point in Malaysian politics.  It saw the ruling coalition losing its two-thirds majority in Parliament for the first time since 1969, in addition to losing control of five states. Malaysia has not been the same since. For one, more Malaysians have taken interest in the election process and issues pertaining to it. This has also contributed to the rise of civil societies calling for free and fair elections, including a cleaning up of the electoral roll and introducing reforms to bring about a more transparent election process. Caught in the middle of it all this and under constant scrutiny is the Election Commission, which is entrusted with regulating and conducting elections in the country. Amidst accusations from opposition parties and civil society groups that the EC is an ineffective institution that is biased in favour of the federal government run by Barisan Nasional, fz.com approached its chairman, Tan Sri Abdul Aziz Mohd Yusof, for a response. Despite his busy schedule, he made time and amiably received us at his office in Putrajaya. The interview started off in a brisk, business-like manner but as he warmed up to us, he became more animated and firmly stood his ground in maintaining that the EC has nothing to hide. On Campaign Funds Did the EC impose rules on spending on campaign funds in 2008?Yes, we did. The candidates were allowed to spend RM100,000 for each state seat and RM200,000 for each parliament seat, and they had to submit details of their expenditure. But when we asked them for such details, they claimed that their respective party headquarters had funded the printing of posters or dinners.  They only provided us details of their personal expenditure. So the relevant election law does not cover party expenditure during a campaign?No. The law only mentions the candidate. Have any initiatives been taken to plug this loophole?The EC does not have the power to audit a candidate or party's expenditure. That power belongs to the Registrar of Societies (ROS). Will the EC work with the ROS to resolve this issue?Yes, but we need a big enforcement team on the ground for people to conduct checks and audits. We will look into it before the next election because candidates have said that RM200,000 isn't enough. They want to spend RM20 million for a parliamentary seat (laughs). So what is a fair amount? We also have to decide who is allowed to be a political funder and the maximum the person is allowed to contribute. Right now the only thing that disqualifies them from the next election is if they fail to submit details of their expenditure. The Use Of Government Resources During Elections What about the use of government resources, such as government vehicles and personnel, during the campaign period?It is not allowed during the campaign period for campaigning. If it is an official function then it is fine. What about the use of government resources to campaign now?That is all approved in the Budget, by Parliament. We have no control over what happens outside of the campaign period. Does this mean that during the campaigning period, even the prime minister cannot use government vehicles?Not for campaigning. If it is for an official function, then yes. What happens if one were to use an official function to campaign?It is not proper and against the law as they are using official duty to campaign. It has to be separate functions. How well is this enforced and monitored?It is really hard to monitor the situation throughout Malaysia, but observers can help with it as well. As for enforcing the law, a report has to be made, an investigation has to be done, a charge has to be filed with the court. In order to charge somebody, you must have sufficient evidence, otherwise it is not easy. Political Violence What are the preparations done by EC to ensure that political violence does not escalate during the campaign period?We have met with representatives from all parties, clarifying what they can do and what they cannot do. The politicians say this coming election will be the dirtiest. To which I ask, "Why the dirtiest? Who makes it dirty? Politicians." The EC is trying its best to ensure that security and safety is taken care of, but the real people who can ensure that the election is peaceful are the politicians themselves and their supporters. If they follow the law and heed the police's and EC's advice, then the election will be peaceful. But if they fail to follow the law then of course there will be problems. We have guidelines for campaigning, what can be said as well as what is not allowed. Just follow that, meaning, in your campaign, talk about your policies or your party, your manifestos, your promises to the voters, and don't hit out personally at other candidates. Is it an offense to hit out on another candidate or against each other?It is against the law. If we have the evidence on it, we can charge them. So far in past elections, how many reports have you gotten?Many reports. But the person that has authority to bring to court is the Attorney General. Reports are done by the police. Criminal matters are handled by the police. As for corruption matters, (it is dealt by) the Malaysian Anti-Corruption Commission (MACC). The EC has no enforcement power, we cannot investigate. However, isn't it the EC's job to ensure free and fair election?Yes, but we don't have the power to investigate you, to call on offenders. I don't have the power to charge anybody. They (MACC and police) have to interrogate, get more evidence, and bring to court. So, can the EC give directives to MACC and to police to do all these?We can. They do help us. Without them, I don't think we can move. Watch out for PART 2 of the interview touching on cleaning up the electoral roll.

https://theedgemalaysia.com/node/10411

Public Bank up on outperform call

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KUALA LUMPUR: Shares of Public Bank rose in morning trade on July 7 after CIMB Equities Research upgraded Malaysian banks to overweight as its turns positive on banks. At 11.09am, Public Bank foreign had risen 15 sen to RM9.25 and Public Bank 10 sen to RM9.20 in active trade. However, the FBM KLCI had shed 0.78 points to 1,065.05. Turnover was 208.38 million shares valued at RM206.15 million. CIMB Research said Malaysian banks havd defied expectations of cratering loan growth and spiralling non-performing loans (NPLs). In a research note issued on July 7, it said local banks had done surprisingly well in protecting themselves from the fallout from the economic downturn. “We are upgrading AMMB from Underperform to Outperform due to the recovery of the capital market and management’s ability to limit the rise in NPLs, Hong Leong Bank from Underperform to Neutral premised on continuous earnings growth and prudent management, and Affin from Underperform to Neutral attributable to its undemanding ratings and rebound in FY10 earnings,” it said. CIMB Research said it was replacing Public Bank with AMMB as its top pick because its transformation programme should speed up the returns on equity (ROE) expansion over the next three years. “NPL ratios remained stable in 1Q09, easing our fears of a jump in credit costs. It is one of the key beneficiaries of the recovery in investment banking income. Its high beta will enable it to ride on the upturn of the equity market. We also have Outperform calls on Public Bank, RHB Capital and Alliance,” it said.

https://theedgemalaysia.com/node/16757

RM31b wealth created in 3 days

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KUALA LUMPUR: Bursa Malaysia Securities turned in the best performance in Asia on July 16 and added another RM7.49 billion to market capitalisation at the close, bringing the total gains for three consecutive trading days to RM31.09 billion. The benchmark index, FBM Bursa Malaysia KLCI, surged as many as 23.17 points to 1,120.41, but closed at 1,108.88, up 11.64 points or 1.06% from the previous day as the inevitable profit- taking activities set in. Analysts said volatility may continue for some time before stability returned in the form of more certainty in the global economy. The FBM KLCI’s close was the highest since Aug 29 last year. The intra-day high compares with the peak of 1,127.46 on Aug 11, 2008. Regional markets too gave up some of the gains from earlier this week as selling pressure emerged in the later part of the day. Japan’s Nikkei 225 closed 0.81% higher at 9,344.16; the South Korean Kospi rose 0.8% to 1,432.22, Taiwan’s Taiex Index added 0.62% to 6,780.3, Hong Kong’s Hang Seng Index was up 0.57% to 18,361.87 and Singapore’s Straits Times Index gained 0.49% to 2,401.02. The Shanghai Composite Index, however, fell 0.15% to 3,183.74. Regional markets had started on a positive note on the back of the strong closing on Wall Street, and received a further boost from China’s better 2Q09 gross domestic product numbers. The Dow Jones Industrial Index surged 3.07% or 256 points to 8,616.21. The Chinese economy grew at a faster rate of 7.9% in the second quarter (2Q), well above the 6.1% growth registered in 1Q, spurred by massive government spending and a big spike in bank lending. However, with share prices having risen for the better part of this week, investors are locking in some of their gains. European markets, that appeared to give some up gains from earlier this week in early trade, turned slightly positive after JP Morgan released better-than-expected 2Q results. Over on Bursa Securities, turnover surged 22% to 1.67 billion units valued at RM2.14 from 1.37 billion units or RM1.79 billion worth of trade. Gainers outpaced losers 398 to 304, while 229 counters were traded unchanged. Since Monday’s close, market capitalisation over the past three days rose 3.8% to RM842.81 billion. The ringgit closed marginally higher against the US dollar and was quoted at 3.5630 per dollar at 5pm on July 16 versus 3.5680 the previous trading day. Crude palm oil futures fell RM52 per tonne to RM2,063 for August delivery and RM72 per tonne to RM2,031 for September delivery. Crude oil fell 72 cents per barrel to US$60.82 (RM217.13) as at 6.30pm on July 16. MIDF Research head Zulkifli Hamzah said the strong market performance on July 16 was due to the wave of optimism from regional and overnight US markets. He said participation was reasonably broad-based, adding that retail investors in particular were back as evidenced by movement in penny stocks and the fact that trading volume exceeded one billion shares. Zulkifli said the rally was sustainable provided that the momentum in external markets remained intact, and that there was no immediate country-specific risk as far as Malaysia was concerned. “Asian equity is just enjoying a renaissance resulting from a flow of global liquidity as a result of pump priming measures and easy money policy around the world. “More importantly, the currency risk in holding the greenback, which was less of a factor before the financial crisis, has increased the relative attractiveness of markets in Asia.” Zulkifli said while sentiment on Wall Street had been particularly positive this week given strong earnings numbers, bouncing back from the low, the worry was that once the reporting season was over, the spectre of slowdown may come back to haunt the market. “The downside risk, if at all, can be found in the technical indicators. The market appears to be overbought, although all the indicators may not be in agreement. “For example, today the 14-day relative strength index (RSI) exceeded the critical upper range of 70 points. However, there has yet to be any clear technical pattern forming,” he said. Among the major gainers at Bursa Malaysia were Axiata Group Bhd, Sime Darby Bhd, Tenaga Nasional Bhd, AMMB Holdings Bhd and Malayan Banking Bhd. Axiata added 15 sen to RM2.85, Sime and Tenaga up 10 sen each to RM7.45 and RM8, AMMB gained 14 sen to RM3.82 while Maybank and Public Bank Bhd rose five sen each to RM5.95 and RM10. Genting Malaysia Bhd gained seven sen to RM2.78, PLUS Expressways Bhd up six sen to RM3.24, Telekom Malaysia Bhd added four sen to RM2.99 while Kumpulan Perangsang Selangor Bhd and Puncak Niaga Holdings Bhd rose 16 sen each to RM2.07 and RM3.12. Among the losers, Hartalega Holdings Bhd fell 12 sen to RM4.56; Top Glove Corporation Bhd, Voir Holdings Bhd and Genetec Technology Bhd fell 10 sen each to RM7.25, RM1.38 and 20 sen, respectively. Other losers included Tahps Group Bhd, Petra Energy Bhd and Ge-Shen Corporation Bhd. KNM Group Bhd was the most actively traded counter with 131.55 million shares done. The counter gained 1.5 sen to 85 sen. Other actively traded stocks included Saag Consolidated (M) Bhd, Axiata, Jaks Resources Bhd, Talam Corporation Bhd, UEM Land Holdings Bhd and Scomi Group Bhd.

https://theedgemalaysia.com/node/5208

Kencana poised to win more jobs

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Kencana Petroleum Bhd (March 26, RM1.57)Reiterate trading buy at RM1.59, target price raised to RM1.86: Earnings for the first half (1H) of the financial year ending July 31, 2010 (FY10) fell short of estimates, accounting for only 36.4% and 43% of ours and consensus’ full-year estimate respectively. However, the second quarter (2Q) tends to be Kencana’s weakest quarter. Despite lower contract realisation, Ebit (earnings before interest and tax) margins were buoyed by favourable fabrication margins (on average higher than 15%) as most of the raw material costs, mobilisation expenses are passed down to its clients. We believe management had implemented cost control measures as early as 1Q of calendar year 2009 to preserve earnings. Moving forward, we expect Kencana to lock in higher margin revenue derived from its marine segment which delivers high yields and constant income stream. Order book replenishments were rather slow in 2H09. Nonetheless, we understand that the group is anticipating to be awarded several substantial projects in “smaller packets” in the near future. We believe the group will be in line with its annual targeted replenishment rates of at least RM1 billion per annum. The present order book is about RM1.7 billion comprising RM800 million from marine engineering, RM27.6 million from project management and RM827.2 million from Kencana Petroleum Ventures (KPV), the group’s marine services division.However, the current spare capacity may prove to be an advantage for Kencana as it is able to take on immediate new jobs. There are possible immediate re-rating catalysts for Kencana. We understand that the group is in a solid position to win further fabrication contracts awarded by domestic PSC (production contract sharing) clients, which will warrant an earnings revision. This is also supported by the construction of anchor handling tug supply (AHTS) vessels and workbarges to provide steady income stream for its KPV segment and Petronas potentially awarding an estimated RM4 billion of new fabrication jobs. Kencana’s spare capacity at its fabrication yard and solid track performance would be its biggest value propositions in bidding for jobs. We reiterate our trading buy recommendation with an increased target price of RM1.86 (previously RM1.55 post-rights issue) based on 18 times price-to-earnings ratio (PER) of FY10, which is a 20% discount to its four-year PE average at 23 times. We retain our FY11 numbers as we await the award of the forthcoming fabrication contracts which will have accretive effect on future earnings. Kencana is currently trading at 15.4 times earnings per share (EPS) 2010, within its four-year average PE of 13.9 times to 42.3 times. — MIDF Research, March 26 This article appeared in The Edge Financial Daily, March 29, 2010.

https://theedgemalaysia.com/node/80819

#Highlight* Tian Chua claims trial to sedition charge on Lahad Datu remark

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KUALA LUMPUR (March 14): PKR vice president Tian Chua (pix) claimed trial today after being charged with sedition in relation to remarks made on the Lahad Datu intrusion. "This is a politically motivated charge and I plan to clear my name of this slander," Tian Chua said after the charge against him was read at the Sessions Court here. He is charged under Section 4 (1) (b) of the Sedition Act 1948. Justice Mohamad Sakeri Mamat set bail at RM5,000, denying the defense's plea for a personal bond without surety. He also set April 12 for the case's mention. Tian Chua was charged with sedition for uttering provocative remarks in four statements namely:> the shooting which occurred at Lahad Datu is believed to be an organised conspiracy by the Umno government to divert attention and scare the people;> the incident raises a lot of questions and doubts over the Umno government's show;> likened the Lahad Datu intrusion as a government theatrical to scare the people as if there exists a non-peaceful situation in Sabah; and> there was an Umno government conspiracy to divert the attentions of Sabahans, especially from the issue on the distribution of identity cards to foreigners. He was alleged to have committed the crime at 62-2-A, Fraser Business Park, Jalan Metro Pudu, off Jalan Yew, Kuala Lumpur on March 1, 11am. If convicted, the Batu MP will face a jail sentence of not more than three years or a fine of RM5,000 or both. Tian Chua’s lawyer N. Surendran said the prima facie of the charges have no merit. He also contended the Sedition Act was obsolete as it was a colonial law. "Furthermore, colonialists have never used the law." Surendran also said Prime Minister Datuk Seri Najib Razak had announced on July 11, 2012 that the act would be repealed. "So, the charges are flimsy, considering the PM has pledged to repeal the law," he said, adding the act also runs contrary to Article 10 of the Federal Constitution which stipulates freedom of speech. However, Deputy Public Prosecutor (DPP) Yusaini Amer Abdul Karim said the prosecution will furnish evidence to support its case, therefore, it was premature for the court to perceive it as having no merit. He also said as the act is yet to be repealed, it is legitimate and still in force. Yusaini said Article 10 (2) (b) also allows Parliament to impose laws to restrict freedom of speech in the interest of the security of nation's security and public order. After the hearing, Surendran said the defense team would be filing an application at the High Court soon to strike out the charges leveled against Tian Chua. He said the case was clearly politically motivated, saying the people's fundamental rights to free speech has been breached. "Freedom itself is on trial today, not just Tian Chua”. Surendran said the government has been continually harassing Opposition leaders and it was time to stop these intimidation tactics. "They (the government) are desperate. They are questioning opposition leaders like (Puchong MP) Gobind Singh (Deo) and (PKR deputy president Mohamed) Azmin Ali. "We fear more opposition leaders will be targeted, including (PKR leader Datuk Seri) Anwar Ibrahim. Stop using the law against the Opposition. Stop targeting the Opposition," he said. Tian Chua came under fire from both sides of the political divide for allegedly making the remarks, which was reported by the party's media organ Keadilan Daily and several other media. The police had recorded his statement three days ago, as well as statements from two Keadilan Daily editors. On March 7, several PKR and PAS members in Sungai Petani joined Umno and Parti Kesejahteraan Insan Tanah Air (Kita) to lodge police reports against Tian Chua. Deputy Inspector-General of Police Tan Sri Khalid Abu Bakar had reportedly said police had recorded statements from 140 people facilitate investigations into the allegations. Media reports show initial investigation was carried out under Section 500 of the Penal Code for defamation.

https://theedgemalaysia.com/node/55398

Tambun Indah acquires more land in Pearl City

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Tambun Indah Land Bhd(Dec 13, RM1.40)Maintain buy at RM1.39 with a revised fair value of RM2.08 (from RM2.05): Tambun Indah is acquiring another 21-acre (8.5ha) freehold land at Pearl City project in Penang. This came after the acquisition of a 24.1-acre land parcel in the township last month. The purchase consideration of RM12.7 million translates into a land cost of RM14 per sq ft (psf), similar to the previous transaction. The key reason for the lower acquisition price compared with Ecoworld Development Sdn Bhd’s over RM30 psf and IJM Land Bhd’s (“buy”, fair value [FV]: RM3.70) RM18.50 psf is that the land does not have road access other than via Tambun Indah’s land. The low land cost will ensure the sustainability of its attractive margin of 30% to 35%. With this new land, the total gross development value of Pearl City will increase by RM120 million to about RM2.4 billion. We are positive on management’s efforts to continue widening Tambun Indah’s presence on the mainland of Penang. Big players such as Ecoworld, IJM Land and Mah Sing Group Bhd (“neutral”, FV: RM2.44) have been aggressively snapping up landbank in Seberang Perai Selatan this year, given the positive prospects to be brought by the opening of the second Penang bridge in the first quarter of 2014, as well as local and foreign investments flowing to Batu Kawan. Tambun Indah sees minimal impact from the state’s new cooling measures, as demand for properties in Pearl City is genuinely driven, and all its products are priced above the RM250,000 mark. Note that the state government will impose a 2% levy on properties sold within three years effective Feb 1, 2014, and limit the sale of affordable houses (less than RM400,000 on the island and less than RM250,000 on the mainland) to eligible first-time home buyers in the state’s list of registered buyers. We make no changes to our forecasts, as the new land is planned for the later phases in the township. Given the incremental value, we raise our fair value to RM2.08 (from RM2.05), based on an unchanged 15% discount to revised net asset value. Maintain “buy”. — RHB Research, Dec 13 This article first appeared in The Edge Financial Daily, on December 16, 2013.

https://theedgemalaysia.com/node/81582

#Hot Stock* TRC jumps on JV with Prasarana, earnings prospects

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KUALA LUMPUR (Mar 26):  TRC Synergy Bhd rose as much as 6% after the builder and property developer said it will jointly undertake a RM687.6 million real estate project on prime Klang Valley land with Syarikat Prasarana Negara Bhd. At 12.30pm the stock was traded at 56 sen with some 323,000 shares done after rising as much as three sen to 57 sen earlier. TRC said yesterday the property job will include residential, office and retail units to be constructed within an estimated  49,776 sq m (five ha)  tract along the Jalan Lapangan Terbang Subang in Selangor. According to TRC, the project makes commercial sense as the company is already the contractor for the construction and completion of the light rail transit (LRT) Station 2 within the area. Alliance Research Sdn Bhd analyst Jeremy Goh the property project, by virtue of its gross development value (GDV), is a significant one for TRC. This is because the builder had in the past undertaken smaller real estate projects with GDV's of less than RM100 million. "Given the strategic location of the development surrounding the LRT station, we believe that take up rates could be promising. As such, we are positive on TRC undertaking this venture. "We continue to like TRC as a potential earnings turnaround play which should see numbers coming in this year," Goh said. Alliance is keeping its “buy” call for TRC with a fair value of RM68 sen.

https://theedgemalaysia.com/node/41443

Profit-taking from KLCI’s new all-time high

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ASIAN share markets ended mixed yesterday as investors sold off after China manufacturing figures expanded at a slower pace in  December 2013. Asia declined yesterday despite the better US December consumer confidence figure of 78.1 and the S&P October Case-Shiller housing data that gained 13.6% over the past year. The S&P500 gained 7.29 points to close at 1,848.35 points whilst the Dow rose 72.37 points to end at 16,576.66 on Tuesday night. In Malaysia, the FBM KLCI traded in a downward range of 33.37 points for the week with volumes of 1.25 billion to 1.50 billion done. The index closed at 1,852.95 yesterday, down 14.01 points from the previous day as blue-chip stocks like Kuala Lumpur-Kepong Bhd, Petronas Dagangan Bhd, Petronas Gas Bhd, Public Bank Bhd and Tenaga Nasional Bhd caused the index to decline on some post-window dressing profit-taking activities yesterday. The index rose on a rally from the 801.27 low (October  2008) to the previous 1,826.22 all-time high (May 2013) and it represented an extended Elliott Wave “Flat” rebound in a “Pseudo-Bull” rise completed. The index price movements in the next few months following  May 2013 were trapped in a rangy consolidation with key swings of 1,723.74 (low), 1,811.65 (high), 1,660.39 (low), 1,805.15 (high), 1,759.66 (low) and 1,882.20 (high). The index’s daily CCI, DMI, MACD and Oscillator are positive. As such, the index’s obvious support levels are seen at the 1,800, 1,828 and 1,848 levels, while the resistance areas of 1,852, 1,868 and all-time high of 1,882 will witness some heavy profit-taking activities. Our upside targets for the index are now at 1,898, 1,900 and 1,924 for the medium term. Its simple moving averages (MA) depict a triple time frame (daily, weekly and monthly) uptrend for now. Due to its positive signals (except Stochastic), we believe investors may adopt a “Nibble on Dips” philosophy as the KLCI remains at fairly lofty levels with bearish divergent signals. As such, profit-taking on index components as well as small- to mid-caps may persist after the December 2013 year-end window-dressing period. Despite the lofty tone of the KLCI, we are recommending a chart “buy” on Tiong Nam Logistic Holdings Bhd, which is a RM622 million market-cap company with a return on equity of 12.4% based on its 12-month trailing earnings. The stock made a new recent high of RM1.50 in tandem with the improving sentiment of the small- and mid-cap stocks. The firm rise in the stock prices can be attributed to investors’ optimism on its strong earnings trend. Tiong Nam’s stock price continued to surge after the announcement of results for the second quarter ended Sept 30 of financial year 2014. The stock price hike indicated that investors approved the profit contribution from its property development segment. No property development revenue was recognised in the corresponding period a year ago. According to the company, its revenue for logistics and warehousing services also improved due to an increase in transportation and rental rates as well as higher occupancy rates of its warehouses. Maybank IB does not have fundamental coverage on Tiong Nam. A check on Bloomberg consensus revealed that only one broker has coverage on the stock, with a “hold” call.  The stock is currently trading at a reasonable historical price-earnings ratio of 16.7 times and a price-to-book value of 1.96 times. Tiong Nam’s indicated dividend yield is at 1.62%. Its chart trends on the daily, weekly and monthly time frames are very strong indeed. Its share price made an obvious surge since its weekly Wave-2 low of 19 sen in May 2012. Since that 19 sen low, Tiong Nam  surged to its recent high of RM1.50. Its chart has moved into very strong daily, weekly and monthly uptrends to its recent high of RM1.50. As it broke above its recent key critical resistances of RM1.22 and RM1.33, look to buy Tiong Nam on any dips to its support areas as the moving averages depict very firm short- to long-term uptrends for this stock. The daily, weekly and monthly indicators (like the CCI, DMI, MACD, Stochastic and Oscillator) are very strong and now depict the obvious indications of Tiong Nam’s eventual surge to much higher levels. We expect it to remain very firm towards its support levels of RM1.22, RM1.33 and RM1.44. It will attract minor profit-taking activities at the resistance levels of RM1.50, RM1.73 and RM1.86. Its upside targets are now located at RM1.88, RM1.94, RM2.28 and RM2.47. Lee Cheng Hooi is the regional chartist at Maybank Kim Eng. The views expressed in the article are the opinions of the writer and should not be construed as investment advice. Please exercise your own judgment or seek professional advice for your investment decisions. Technical report appears every Wednesday and Friday. This article first appeared in The Edge Financial Daily, on January 3, 2014.

https://theedgemalaysia.com/node/81339

MRCB-DMIA still waiting for double tracking job award

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Malaysian Resources Corp Bhd (March 21, RM1.49) Maintain buy at RM1.39, with a target price (TP) of RM2.71: According to a local press report, the joint venture (JV) between Malaysian Resources Corp Bhd (MRCB) and DMIA Sdn Bhd has received a letter of intent from the government to upgrade the Klang Valley double tracking (KVDT) system for around RM850 million. The report said the scope of works has not been clearly defined as a study on the KVDT system upgrade has not yet been completed. The KVDT system was built in the 1990s and involves 150km of double tracking from Rawang to Seremban, and Port Klang to Sentul. The proposed upgrade would help divert cargo traffic from the main KTM line between Rawang and Seremban and also provide an alternative mode of transport for commuters. Earlier reports said a comprehensive KVDT upgrade would cost about RM5 billion, and it includes a 110km bypass line from Serendah to Port Klang costing about RM2 billion. When translated into a letter of award, the job would help replenish MRCB’s external construction order book, which has depleted to about RM840 million as at end-2012. The final impact on MRCB’s earnings would also depend on its stake in the JV, which has not been disclosed. DMIA is reported to be owned by four individuals, including Subramaniam Pillai Sankaran Pillai who has a stake of 50.4%. The Gapurna landbank acquisition proposals are still pending approval and expected to be completed in the second half of 2013. We believe the landbank acquisitions are long-term positive for the group, which is down to its last piece of development land in the flagship KL Sentral project. We maintain our revised net asset value (RNAV)-based TP of RM2.71 (implied 3% discount to RNAV) and “buy” call. — Affin Research, March 21 This article first appeared in The Edge Financial Daily, on March 22, 2013.

https://theedgemalaysia.com/node/65607

LPI Capital’s claims ratio improves quarter-on-quarter

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LPI Capital Bhd (July 10, RM13.72)Maintain market perform at target price of RM14.05: LPI Capital Bhd recorded a second quarter financial year 2012 (2QFY12) net profit of RM40.4 million, which brought the first-half financial year 2011 (1HFY11) net profit to RM71.9 million (+2.6% year-on-year [y-o-y]). Although this accounted for 42% and 41% of our and consensus full-year net profit forecasts respectively, we consider this to be in line as typically, 1H accounts for 42% to 44% of full-year earnings. LPI Capital announced a dividend of 15 sen per share (1HFY11: 25 sen), which implies a net dividend payout of 46%. While this appears lower than our forecast of a 90% payout for the full year, we believe this was largely due to working capital requirements but expect the full-year net payout to be 70% to 90% of earnings for FY12, underpinned by its strong cashflow, coupled with the fact that its internal capital adequacy ratio position remains healthy. This implies that it would not need to reserve more capital. For example, although LPI Capital only paid out 33% of its 1HFY10, full- year FY10 net dividend payout actually amounted to 86%. Second quarter 2012 (2QFY12) claims ratio normalised to 45% from 60.1% in 1QFY12 (2QFY11: 46.8%). Recall that in 1QFY12, LPI Capital’s claims ratio was impacted by the high frequency of fire claims and catastrophic losses from floods. This brought the 1HFY12 claims ratio to 52.3% (1HFY11: 48.7%) in line with our estimates. Thus, although 1HFY12 gross premiums written rose 18.2% y-o-y, underwriting surplus only grew by 4.7% y-o-y to RM114.1 million due to the higher claims ratio. Risks include change in government policy that may result in lower car prices, jump in claims ratio, combined ratio may exceed 100% and intense competition from liberalisation in the insurance sector. No change to our earnings forecasts. Our fair value is maintained at RM14.05 based on unchanged target of 15 times CY13 earnings per share (EPS). LPI Capital’s earnings remain fairly visible, underpinned by its large exposure towards the low claims ratio fire business, which provides it with lower than average claims ratio of 47% to 52% (compared with industry’s 58% to 63%). Nonetheless, LPI Capital’s current valuations of 14 times to 15 times CY13 EPS imply that it is already almost fully valued. As such, we reiterate our “market perform” call on the stock. — RHB Research, July 10 This article appeared in The Edge Financial Daily July 11, 2012.

https://theedgemalaysia.com/node/89181

Enabling enviroment allows opportunities into successful, profitable venture, says PM

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KUALA LUMPUR (Oct 11): An enabling environment is necessary for entrepreneurs to convert opportunities into a successful and profitable venture, Prime Minister Datuk Seri Najib Tun Razak said today. He stressed that creating an ecosystem in which ideas could be realised was one of the preconditions for success. "Ideas and opportunities cannot travel through a vacuum, they must be born in an open, market-driven environment that welcomes them, nurtures them, allows them to flourish and spread," he told 4,700 delegates at the opening of the 4th Global Entrepreneurship Summit (GES) here today. Also present was United States Secretary of State John Kerry. Najib, who is also the Finance Minister, said around the world, there are different models for constructing such an environment; some organic in origin, others artificial. Apart from that, there are specific policies that governments and businesses can deploy to help, he said, adding that they must define first what entrepreneurship means. The Prime Minister also said there is a tendency to focus on new industries and the young prodigies who often lead them when it comes to entrepreneurship and innovation. This was due to societies that are often preoccupied with youth and countries are in the midst of a period of profound technological change. Citing one study, Najib said around 70 per cent of the goods and services consumed in 199 countries were unrelated to those consumed a century earlier. Yet even 1991 now seems like a different time; mobile phones were still analogue, and there wasn't a single webpage in existence, he said, adding that smartphones, tablets and applications were distant dreams. In addition, many of today's most recognisable entrepreneurs -- people like Larry Page, Sergey Brin and Mark Zuckerberg -- were still in high school, he said. "Change on this scale, at this pace, brings previously unimaginable opportunities. "But entrepreneurship is not the preserve of one industry or one age group alone. It is much wider than that. It is also about the accumulation of insight and innovation over decades; about the process of refinement as well as reinvention," he said, adding that an increasingly, it is tied to social as well as commercial aims. Also present was Deputy Prime Minister Tan Sri Muhyiddin Yassin. The two-day summit, themed "Empowering and Connecting Entrepreneurs", also saw the presence of leaders around the region including Vietnam's Deputy Prime Minister Hoang Trung Hai, Laos' Deputy Prime Minister Somsawat Lengsavad and Cambodia's Deputy Prime Minister Keat Chhon.

https://theedgemalaysia.com/node/93642

Highlight: Barisan Nasional retains Kuala Besut state seat

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KUALA BESUT (July 24): At 10.14pm tonight Election Commission returning officer A Rahim Jusoh announced that Barisan Nasional (BN) retained the Kuala Besut state seat with a slightly increased majority of 2,592 votes, compared to the 13th general election. BN's Tengku Zaihan Che Ku Abdul Rahman polled 8,288 votes to trump PAS' Endot @ Azlan Yusof who received only 5,696 votes. Azlan was not present when the winner was announced at the voting centre – Kuala Besut district events hall. In the May 5 GE13, the ruling coalition held on to the Kuala Besut state seat with a 2,434 majority after incumbent Dr A Rahman Mokhtar defeated PAS' Napsiah Ismail. The seat fell vacant after A Rahman died of lung cancer last month. Malay voters make up 99% of the 17,683 eligible voters in the constituency while the remaining are Chinese. The Returning officer said 125 ballot papers were spoilt and the turnout today was at 80%. If PAS had won, the 16-16 ratio would have presented a very extraordinary situation for the state. Today marked the end of a 12-day campaigning battle which saw over RM400 million worth of initiatives announced by BN and calls for a better check and balance system by PAS which claimed was possible if both parties shared the same number of state seats. In celebrating his win, Tengku Zaihan thanked the voters and the party machinery for their support and promised to serve the people as best as he can. "We had a very focused machinery. We understood and experienced the people's grievances and this was what convinced the grassroot that no other government but BN could help them," he told journalists. Tengku Zaihan said he had his work cut out for him in that he would carry forth the missions set out by A Rahman, and among other tasks improve on infrastructure for the fishermen in the constituency. In an immediate response to the results, PAS pinned the loss down to two main factors – the weekday polling date which they claim prevented many from returning to vote; as well as the mega projects worth close to half a billion ringgit announced by the BN-led government. Besut PAS chief Wan Azhar Wan Ahmad told a press conference tonight, that while BN may have won, the number of votes earned did not justify the money spent. "It shows that Jusoh's influence is weakening and that in turn shows us the leadership crisis in Terengganu is far from over," he said alluding to Besut member of parliament Datuk Seri Idris Jusoh and the alleged rift between the latter and Menteri Besar Datuk Seri Ahmad Said. Azlan meanwhile said that he was not surprised he had lost. "I was up against the Malaysian government," the contractor quipped.  

https://theedgemalaysia.com/node/18761

Red Bull co-founder still the richest Thai

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In a statement yesterday, Forbes Asia said it was his third consecutive time at pole position. The 77-year-old tycoon’s net worth stayed flat at US$4 billion (RM13.88 billion) during the year. It said the combined wealth of Thailand’s 40 richest also saw no change at US$25 billion. Forbes Asia said the kingdom’s wealthiest had proven to be resilient despite the global economic downturn and self-inflicted political instability that had seen five prime ministers in three years. At No 2 is Dhanin Chearavanont, head of agribusiness conglomerate Charoen Pokphand Group, one of the world’s biggest feed and poultry companies. Dhanin, who moved up the ranking two notches, is also the biggest gainer in dollar terms. His wealth soared by a billion dollars to US$3 billion. Other tycoons in the food and agriculture businesses also enjoyed gains in their net worths. Among them are sugar barons Isara Vongkusolkit (No.8, US$900 million) of Mitr Phol Sugar and Nantha Chinthammit (No 18, US$360 million) of Khon Kaen Sugar Industry, and seafood tycoon Kraisorn Chansiri (No 28, US$175 million). Bucking the trend, however, was Charoen Sirivadhanabhakdi of Thai Beverage. His net worth fell to US$2.8 billion from US$3.9 billion last year. Ranked fourth on the list, he also had the biggest decline among those on the list. At No 3 are descendants of Central Group’s founder, Tiang Chirathivat, including families of his three wives and 25 children. Their combined wealth increased by US$100 million to US$2.9 billion. Their shared net worth is largely derived from ownership of Central Retail and their 60% stake in listed developer, Central Pattana. Still firmly in the limelight is Thaksin Shinawatra, who remains at No 16 on the list. The former prime minister has a net worth of US$390 million, down from US$400 million last year. Thaksin was ousted in a 2006 coup and was convicted in absentia in October to two years in prison for violating conflict-of-interest laws when his now former wife purchased land from the government. Over three million Thais have signed a petition presented to the King requesting his pardon. Forbes Asia said Thaksin was among 19 on the list who saw their net worths decline this year. Also poorer is hospitality tycoon William E Heinecke who dropped five places to No 20 as his wealth of US$350 million is US$110 million less than in 2008. There are four new faces this year, led by long-time Thai resident Aloke Lohia. At No 19, he is the highest ranking with a net worth of US$355 million.  The 50-year-old tycoon started Indorama Polymers which had US$1.2 billion in sales last year. The minimum net worth needed to make the list is US$85 million, up from US$70 million last year. This article appeared in The Edge Financial Daily, September 25, 2009.

https://theedgemalaysia.com/node/17618

PM: Ekuinas activities will benefit all Malaysians, economy

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KUALA LUMPUR: The Prime Minister said Ekuiti Nasional Berhad (Ekuinas), which unveiled its operational details and investment framework on Sept 4, would undertake activities which will benefit all Malaysians and the Malaysian economy. Datuk Seri Najib Razak said through its investments, Ekuinas would play a major role in strengthening Bumiputera participation and at the same time, will forge genuine partnerships with non-Bumiputeras. "Thus, as a result, Ekuinas activities will benefit all Malaysians and the Malaysian economy,” he said in a statement after Ekuinas's board of directors announced the operational details and investment framework. At a press briefing, Ekuinas chairman Raja Tan Sri Arshad Raja Tun Uda said the organisation would be a Government-linked private equity fund management company that aims to create Malaysia’s next generation of leading companies, while promoting equitable and sustainable Bumiputera economic participation. Ekuinas has been established as a wholly owned subsidiary of Yayasan Ekuiti Nasional, a Bumiputera trust. Najib also announced Yayasan Ekuiti Nasional’s members of the board of trustees, of which he is the chairman. The other members are Deputy Prime Minister Tan Sri Muhyiddin Mohd. Yassin; Minister in the Prime Minister’s Department Tan Sri Nor Mohamed Yakcop; Minister of International Trade and Industry Datuk Mustapa Mohamed; Second Finance Minister Datuk Seri Ahmad Husni Mohamad Hanadzlah; Secretary General of the Treasury Tan Sri Dr. Wan Abdul Aziz Wan Abdullah and Director General of the Economic Planning Unit Datuk Noriyah Ahmad. At the press briefing, it was highlighted that Ekuinas would be commercially driven, utilising both public as well as private capital to invest in meaningful stakes in entities with strong potential for growth. Ekuinas would invest in medium to large sized companies and would take an active investment role in growing its investee companies as well as enhance the quality of management. The investment decisions and selection of management by Ekuinas will be based on merit. It would build on success, supporting entrepreneurs with a proven track record. Ekuinas would also build up companies through putting in place professional management with performance based compensation, including equity based incentives. “We have a good number of highly talented Bumiputera professionals and we will enlarge the entrepreneur pool by making some of them professional-owner-managers,” said Najib. The Prime Minister added Ekuinas would manage its own portfolio of investments as well as outsource some of its funds to capable private equity investment firms. Najib also said a high level committee for Bumiputera Entrepreneurial Development will be formed to specifically focus on strengthening Bumiputera entrepreneurship within the start up and development phase. This committee will report to him and will be chaired by Nor Mohamed. The committee will be based on the successful model of the Putrajaya Committee for GLC High Performance and is aimed at enhancing the effectiveness of entrepreneur development programmes undertaken by relevant Government-linked institutions. Najib said the establishment of Ekuinas and the Putrajaya Committee reflects the Government’s approach of using multiple instruments to comprehensively address the challenges in developing Bumiputera and Malaysian entrepreneurs.

https://theedgemalaysia.com/node/86774

AFG’s 4Q net profit increases 13% to RM139m

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KUALA LUMPUR: Alliance Financial Group Bhd (AFG) has announced that its net profit for the fourth quarter (4Q) to March rose 13.3% to RM138.8 million, from RM122.5 million a year ago. For the 2013 financial year (FY13), AFG reported a net profit of RM538 million, an increase of 7% compared with RM503 million for FY12. In announcing the results, group CEO Sng Seow Wah said: “The group registered a return on equity of 13.8% and earnings per share of 35.3 sen for the financial year ended March 31, 2013. “In view of the group’s improved financial performance, the group paid a higher dividend of 16.6 sen during the financial year compared with 13.3 sen in FY12. This translated into a dividend payout ratio of 46.9%.” On its outlook, AFG said it expects to deliver “satisfactory performance” for FY14. This article first appeared in The Edge Financial Daily, on May 22, 2013.

https://theedgemalaysia.com/node/68392

KLCI falls below 1,630-level

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KUALA LUMPUR (Sept 6): The FBM KLCI fell below the 1,630-point level on Thursday, as a sell down of index-linked stocks weighed the market down. At 10.40am, the FBM KLCI lost 14.06 points to 1,626.95. Market breadth was negative with 435 losers, 78 gainers and 226 counters trading unchanged. Volume was 331.52 million shares valued at RM349.29 million. The major losers included PPB, Petronas Gas, KLK, Aeon Credit, Dutch Lady, Petronas Dagangan, Tradewinds, Shell, GAB and Hong Leong Bank.

https://theedgemalaysia.com/node/78956

Bumi Armada buoyant

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Bumi Armada Bhd (Feb 19, RM3.81) Maintain outperform at RM3.79 with a target price of RM4.44: The journey was rough but Bumi Armada has emerged victorious in the battle for India’s state-owned Oil and Natural Gas Corp Ltd’s (ONGC) fixed nine-year floating production, storage and offloading (FPSO) contract worth around US$740 million (RM2.29 billion). The company’s prospects remain buoyant as it continues to ride the wave of global pent-up demand after a quiet 2012. We maintain our forecasts as the contract value falls within our assumptions. We continue to value the stock at 18.6 times calendar year 2014 price-earnings ratio (PER), a 40% premium over our target market PER. This contract win and a strong contract pipeline are the potential rerating catalysts that shore up our “outperform” call. Bumi Armada announced that its 49.998% owned SP Armada, a joint venture with Shapoorji Pallonji, has secured a contract to supply a FPSO vessel to ONGC. The contract US$740 million is for nine years, and is extendable by another seven years for a contract value of US$340 million. The news did not come as a surprise as we had highlighted Bumi Armada’s frontrunner status for the long-delayed contract in our earlier notes. Nonetheless, we are thrilled that the company has finally sealed the deal, putting an end to a dry spell that started in the second half (2H) of 2011. This contract marks Bumi Armada’s sixth FPSO order and its second with ONGC. It has boosted the company’s order book by an estimated 15% to a record RM8.4 billion. Now armed with six FPSO jobs, Bumi Armada is bidding for seven others: one each in Malaysia, Indonesia and Angola and two each in Nigeria and the North Sea. Malaysia’s Belud could be rolled out next month, followed by the North Sea’s Kraken by mid-year. Accumulate the stock. The contract stretches further Bumi Armada’s long-term earnings visibility. The primary terms will last until 2022 but the extensions could stretch until 2029. — CIMB Research, Feb 19   This article first appeared in The Edge Financial Daily, on February 20, 2013.  

https://theedgemalaysia.com/node/93184

Ringgit closes higher against US dollar

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KUALA LUMPUR (July 22): The ringgit rebounded to close higher today against the US dollar and all other major currencies on buying support, dealers said. The market also drew support from China's central bank when it removed controls on bank lending rates to bring about cheaper credit to spur the Chinese economy. Trading was, however, thin as investors were watching out for whether the US Federal Reserve would reduce its bond-buying programme. The local unit closed at 3.1790/1820 against the greenback, versus Friday's 3.1910/1940. It rose against the Singapore dollar to 2.5166/5192 from 2.5201/5235 last Friday, increased against the yen to 3.1784/1817 from 3.1818/1864 previously and appreciated against the British pound to 4.8594/8653 against last Friday's 4.8666/8724. The ringgit also improved marginally versus the euro, to 4.1832/1878 from 4.1834/1880 previously.

https://theedgemalaysia.com/node/597

Teo: MACC lacks initiative

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Teo Nie Ching (Serdang-DAP) said it was unacceptable that the MACC had decided not to investigate the case with the excuse that reporters could not identify the staff at the media centre, although his name has been provided in the police reports made by reporters from the Merdeka Review. Teo said she has submitted a question to the Prime Minister asking to explain on whose authority the staff was told to distribute envelopes containing RM300 to reporters and whether any actions or investigations have been taken. She said her question was rejected on the grounds that it contradicts Rule 23(1)(c) of the Standing Order, which states that a question shall not contain any argument, interference, opinion, epithet or misleading, ironical or offensive expression nor shall a question be frivolous or be asked seeking information on trivial matters. “Such a classification is difficult to justify as my question does not contain any argument, interference, opinion or epithet. It could never be a frivolous or trivial matter too,” said Teo in Parliament lobby today. She said the approach taken by MACC and the information ministry is a mockery of the so-called reforms toward a corrupt-free society.

https://theedgemalaysia.com/node/71343

Stage: A cappella group Fork mesmerises with their renditions of classic rock tunes and current hits

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Finnish a cappella group, Fork, straddles the line between the conventional and unconventional. Four mellifluous voices come together in perfect pitch and harmony to perform renditions of ballads and pop tunes, much like old-school a cappella groups such as The Flying Pickets. But Fork takes the genre to new heights with their covers of heavy metal, classic rock and dance hits — with soaring guitar riffs and pulsating club beats, all replicated with their voices, and lighting effects to boot. Fork, presented by Gardner & Wife Theatre, made its Asian debut in Malaysia last weekend at PJ Live Arts, and they will be performing there until Oct 28. The dynamic quartet is made up of actors Mia Hafrén and Jonte Ramsten, former police cadet Kasper Ramström, and singer Anna Asunta, together with French audio wizard Grégory Maisse, who works his magic behind the scenes. Formed in 1996, the acclaimed contemporary a cappella group is a household name in their native Finland and has performed for audiences all over Europe. Their show is a winning combination of harmonious vocals, charismatic stage presence, energetic dance moves (in particular by Hafrén), and a dash of anecdotal humour. Each of the singers takes turns doing accompanying sounds  and vocals or solo vocals, and each one has a distinct personality. Hafrén, a towering brunette, is the rocker-chick, while the petite blonde Asunta captivates with her sometimes angelic, sometimes sultry voice. The longhaired Ramström is a bass and beatboxing whiz, while Ramsten entertains with his antics and wit. Together, the group presented a show styled very much like a rock concert with a line-up comprising current hits and classic rock tunes. The audience, predictably, took awhile to warm up to Fork — but towards the end of the almost two-hour concert, almost everyone was on their feet dancing and singing along. Fork opened the first set with a beautiful rendition of Coldplay’s choral-like song Paradise, complete with the guitar solo in the middle and Euro-house synths that undergird the song. It was a great introduction to what this group can do, but what really got the audience going — the audience on Saturday night being of a more mature age group — were hits from the 80s like The Pointer Sisters’ Jump (For My Love) and Europe’s The Final Countdown, which turned into a spirited karaoke fest. Cheers and excitement reached fever pitch with the opening notes of Led Zeppelin’s Immigrant Song, followed by AC/DC’s Highway to Hell, which brought the first set to a rousing finish. The second set consisted almost entirely of pop and dance hits, such as Madonna’s Ray of Light, Coldplay’s Viva La Vida, Rihanna’s Only Girl (In the World) and a medley of Lady Gaga’s hits that was cleverly intertwined with Queen’s Radio Ga Ga. The theatre turned into a pulsating nightclub with a mash-up finale that included Black Eyed Peas’ Gotta Feeling and J.Lo’s On the Floor, among others, and the audience was on its feet dancing like it was 1999. The audience went wild with Bohemian Rhapsody, which Fork performed in the encore. Mesmerising and entertaining from start to finish, Fork’s sleek performance redefines the traditional notion of an a cappella show to make for a true audio-visual feast. Fork is performing until Oct 28 at PJ Live Arts, Jaya One. Show time is 8.30pm, and tickets are priced from RM85 to RM145. Log on to www.tix.my to purchase. This article first appeared in The Edge Financial Daily, on Oct 16, 2012.

https://theedgemalaysia.com/node/67477

Hartalega’s capex on NGC won’t affect dividend policy

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KUALA LUMPUR: Leading synthetic rubber glove maker Hartalega Holdings Bhd is on track to start construction of its new RM1.5 billion facility in Sepang by December this year. The move, according to top officials, will not affect the dividend payout policy and will help the company stay ahead of competitors in terms of cost efficiencies. “We are very close to completing [talks for land acquisition]. We believe we are on track to start construction in December,” said managing director and major shareholder Kuan Kam Hon, adding that construction can commence within two months of attaining the necessary approval. In a worst-case scenario, construction will start in March 2013, he told reporters after the company AGM yesterday. Deputy managing director Kuan Mun Leong said Hartalega expects to spend RM300 million to RM400 million annually in the first three years of construction of the planned next generation integrated glove manufacturing complex (NGC), to be built in two four-year phases through 2021. The land alone is expected to cost some RM100 million. Hartalega intends to fund the construction with internal funds and maintains its 45% dividend in the near term, said Kuan Mun Keng, director for corporate finance and business development. “We have sufficient cash flow to fund this internally.” Hartalega paid a dividend of 21.5 sen per share in the financial year ended March 31, 2012 (FY12), translating into a 4.8% yield at yesterday’s closing price of RM4.46. The first phase of the NGC from 2013-2017 will add 40 production lines capable of producing 14 billion gloves annually. Another 30 new lines with a capacity of 10.4 billion gloves annually are planned for phase two from 2017 to 2021. Upon completion, total production capacity will increase to 38 billion pieces from 10 billion. Hartalega has 17% market share of the world’s total nitrile glove sales or about 6.7% (150 billion pieces) of all rubber gloves sold, Mun Leong said, adding that increased efficiencies from the NGC are expected to propel the company further. Productivity will rise 69% at the NGC utilising Hartalega’s proprietary glove making technology which is capable of producing  natural rubber (latex) as well as nitrile gloves.“It is harder for machines built for natural rubber production to switch [to synthetic rubber] because synthetic gloves are harder to make. “We think [Hartalega] will continue to fare very well, especially with the adoption of the latest technology… which will increase production from 40,000 to 42,000 pieces per hour,” said Mun Leong. Increased efficiencies from the 72 lines are expected to increase annual sales per employee to RM516,000, up 69% from the current average of RM306,000, which is substantially above the industry average of RM200,000, he added. Officials said Hartalega’s sixth plant in Bestari Jaya, Selangor will add 30% capacity to the group upon completion next June from the present 10 billion pieces. The first 10 production lines will be commissioned in September with the rest periodically through June 2013. The first full year of contribution from the sixth plant will be realised in FY15 ending March 31,  Mun Leong said. For the NGC, three plants will be built concurrently but Hartalega officials see “no issues” using up the additional capacity, citing the strong global appetite for synthetic gloves in recent years. This is expected to continue growing at an average of 20% annually in the medium term. Mun Keng said the NGC could boost margins by 6% to 8%. This will give Hartalega greater flexibility in pricing while still maintaining a healthy double-digit margin at 21%, currently the highest among glove makers. “We’re running at 100% capacity, so there has not been any market share loss. Margins have come off slightly due to competition but we think they are sustainable,” Mun Keng said adding that Hartalega targets consistent growth in earnings per share rather than margins growth. Kam Hon said he hopes that investments by local companies, such as Hartalega’s investment in the NGC, will receive some recognition from the government, similar to investments by foreign parties. “We hope to get some tax breaks but that’s up to the government’s discretion,” he said, adding that the NGC was accorded an entry point project status under the government’s Economic Transformation Programme. This article appeared in The Edge Financial Daily on 15 August, 2012.

https://theedgemalaysia.com/node/92303

Malaysian company named suspect in Riau forest fires

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JAKARTA (July 12): The Indonesian National Police has named a subsidiary of a Malaysian company as a suspect in forest burning to clear land for plantations in Riau, according to a report in an English daily here today. National Police spokesman Ronny F Sompie said the company allegedly carried out irresponsible burning practices at its concession area in Riau. "The company is responsible for the fire and has been declared a suspect, but we have not determined the company’s employees who were responsible for the burning," he was qouted as saying by The Jakarta Post. He said the police detected several hotspots in areas controlled by five companies, but had only gained sufficient evidence on the Malaysian company-linked subsidiary's involvement over its use of illegal slash-and-burn methods to clear land for cultivation. Meanwhile, the Association of Plantation Investors of Malaysia in Indonesia (Apimi) has denied any involvement of Malaysian companies in the forest burning in Riau. Apimi executive secretary Nor Hazlan Abdul Mutalib said the association would soon issue a statement in response to the latest allegation by the Indonesian authorities on the matter. The Jakarta Post also quoted Riau Police spokesman Hermansyah as saying that the police had questioned 16 witnesses in the case, ranging from field workers to management-level employees of the Malaysian company-linked subsidiary. "None have been named as the perpetrators of the fire in the company’s concession area... We do not want to rush into naming the responsible parties," he said. The slash-and-burn activity in June has created a severe haze that shrouded Singapore and Malaysia, apart from affecting Indonesians living near the fires in Sumatera. It has also prompted Indonesian President Susilo Bambang Yudhoyono to issue an apology to Malaysia and Singapore.

https://theedgemalaysia.com/node/69256

Mah Sing on the look out for more land

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KUALA LUMPUR (Sept 19): Mah Sing Group Bhd said it is still shopping around to acquire land worth at least RM1 billion in gross development value (GDV) by the end of this year. "So far we this year we have acquired land worth RM3.62 billion in GDV but we have set a target of at least RM5 billion by the end of the year.  So we're still looking out for more land," said Mah Sing group managing director cum group chief executive Tan Sri Datuk Sri Leong Hoy Kum. "Our business model is such that we have a quick turnaround so we must keep replenishing our landbank," Leong added. The group currently has a landbank size of around 1,200 acres with GDV and unbilled sales of RM18.04 billion. "This is enough to last us another seven to eight years without any land replenishments,"Leong told the media after Mah Sing's extraordinary general meeting (EGM) on Wednesday. Leong said the group will also be looking to tap into the current market demand for more affordable housing. "We are quite selective when it comes to certain property sectors, right now there is a demand for mass affordable housing," Leong said. Shareholders unanimously approved the Bangi land acquisition today which the group intends to develop into Southville City, a mix township of residential and commercial properties. "This will be the biggest township project ever for the Mah Sing group," said Leong. The group announced earlier this year that it was acquiring the 412 acres of land from Boon Siew Development Sdn Bhd for RM333.04 million. The freehold land has an estimated gross development value (GDV) of RM2.15 billion. "We plan to meet market demand by exploring the feasibility of offering affordable SoHo and lifestyle suites from RM208,000,"Leong said. Phase one of the development -- which will be launched in the first quarter of 2013-- will comprise of affordable lifestyle suites starting from RM208,000 and double storey link homes starting from RM530,000 onwards. "This will be on top of our landed units and low rise commercial units, which will create diversity in the groups offering with emphasis on affordability."

https://theedgemalaysia.com/node/95273

Nikkei drops to 7-week low on soft Q2 GDP; thin trade hits brokerage stocks

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TOKYO (Aug 12): The Nikkei share average dropped to a 7-week low on Monday after Japan's economy grew more slowly than expected in the last quarter, while thin trade dragged down brokerage stocks on worries about lower commissions. The benchmark Nikkei fell 0.7 percent to 13,519.43 and the broader Topix dropped 0.6 percent to 1,134.62. Only 1.78 billion shares changed hands, the lowest level since December 11. Japan's economy grew an annualised 2.6 percent in April-June, well below the market consensus of 3.6 percent, which added to concerns about a delay in a planned sales tax hike to tackle massive government debt. - Reuters

https://theedgemalaysia.com/node/4901

Bursa Securities rejects Ho Hup's appeal for extension to release audited accounts

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KUALA LUMPUR: Bursa Malaysia Securities Bhd has rejected Ho Hup Cosntruction Company Bhd's application for a one month extension, from May 1 to May 31, to release the annual audited accounts for FY ended Dec 31, 2009. Ho Hup said on Wednesday, April 28, it intends to appeal against Bursa Securities' decision before April 30. It added that it would endeavour to release its annual audited accounts for FY09 as soon as possible.

https://theedgemalaysia.com/node/65559

KLCI futures opens lower

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KUALA LUMPUR (Nov 27): The FTSE Bursa Malaysia KLCI (FBM KLCI) futures contract (FKLI) on Bursa Malaysia Derivatives opened lower this morning. At 9.45 am, spot month November 2013 was 4.0 points lower at 1,796 and  December 2013 lost 3.0 points to 1,7975. Volume stood at 4,738 lots while open interest totalled 48,813 contracts. However, the underlying FBM KLCI was 2.24 points lower at 1,795.89 after 45 minutes of trading.

https://theedgemalaysia.com/node/65793

Guan Chong’s dual listing on track

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KUALA LUMPUR: Guan Chong Bhd (GCB) is going ahead with its secondary listing on the Singapore exchange, refuting reports that it would abort the exercise if it succeeded in selling a significant stake in the company.   The company said it had in fact undertaken investor road shows to target not only institutional investors but potential strategic investors with a long-term view as well. “GCB is currently undertaking investor road shows in Singapore and Hong Kong,” it said in a statement last Friday. GCB said the share sale of up to 62 million shares represents about 18% of its enlarged capital of 350.7 million shares upon completion of its listing. GCB shares will also be offered to Singapore investors. In April, GCB announced plans to undertake a secondary listing in Singapore in order to facilitate access to its capital market, expand and diversify its shareholder base and enhance its profile as one of the region’s leading cocoa processors in the international market. Of the 62 million shares offered, 31 million are new shares and 31 million are vendor shares that will be offered by certain existing shareholders. GCB’s preliminary prospectus was lodged with the Monetary Authority of Singapore on June 28. HwangDBS Vickers Research Sdn Bhd, in a note earlier in June, said GCB’s secondary listing could narrow its valuation gap with its Singapore-listed peer Petra Foods Ltd. GCB is trading at a financial year 2012 (FY12) price-earnings ratio of 7.6 times against Petra’s 15 times. The research firm has maintained its “buy” call on the counter with a target price of RM3.20 pegged to 10 times FY12 earnings per share. Just last week, GCB commissioned a second production line at its plant in Batam, Indonesia, which takes the group’s total annual capacity to 200,000 tonnes. The new 60,000-tonne line brings the Batam facility’s yearly output to 120,000 tonnes. The company also has a cocoa grinding plant in Pasir Gudang, Johor, which is capable of producing up to 80,000 tonnes a year. GCB, with total annual grinding capacity of 260,000 tonnes, is one of the largest cocoa processors in the region, and among the top 10 producers in the world. This article appeared in The Edge Financial Daily, July 16, 2012.

https://theedgemalaysia.com/node/55680

Kuwait to secure $1.4 bln financing for major power project

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KUWAIT (Dec 15): Kuwait is set to secure $1.43 billion in financing from a consortium of banks for a power and desalination plant, one of the major projects in the Gulf Arab state's development plan, National Bank of Kuwait (NBK) said. The Az-Zour North Power and Desalination project is Kuwait's first public-private partnership (PPP) and a test for a country which has struggled to invest in infrastructure and attract foreign investors, partly due to political instability and bureaucracy. Kuwaitis will be offered half the Az-Zour plant through an initial public offering once it starts working, NBK said. Kuwait is in need of additional power capacity. Like other Gulf Arab countries, it has high energy use per capita, particularly during the scorching summer months when air conditioning demand surges. The plant is part of a 30 billion dinar ($106 billion) development plan announced in 2010, which also includes a refinery, new airport and major causeway. The plan is aimed at diversifying the economy and updating Kuwait's infrastructure which is out-moded when compared to regional peers such as the United Arab Emirates. The consortium of lenders for the first phase of the Az-Zour project includes NBK, Japan Bank for International Cooperation, Nippon Export and Investment Insurance, Bank of Tokyo-Mitsubishi , Sumitomo Mitsui Banking Corp. and Standard Chartered Bank, NBK said. South Korea's Hyundai Heavy Industries Co Ltd will build the first phase of the project, which comprises a 1,500 megawatt natural gas-fired power plant and seawater desalination plant. Hyundai, which said on Sunday it had taken over the contract from a GDF Suez-led consortium, said the first phase would be completed in the fourth quarter of 2016. "This is an indication of the improvement in the execution of Kuwait's Development Plan," Shaikha al-Bahar, chief executive of NBK's Kuwait business said in the statement issued on Saturday. Azour North One KSCC and Kuwaiti institutions will own 40 percent and 10 percent of the project respectively through a special purpose project company, the NBK statement said. - Reuters

https://theedgemalaysia.com/node/50391

CMMT buys Kuantan mall for RM310m

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KUALA LUMPUR:  CapitaMalls Malaysia Trust (CMMT) has entered into a conditional sale and purchase agreement to acquire the East Coast Mall in Kuantan for RM310 million. In a statement Tuesday, June 14, CapitaMalls Malaysia REIT Management Sdn Bhd (CMRM), the manager of CMMT, said that the AmTrustee Bhd had entered into the agreement on behalf of CMMT. CMRM said that including the acquisition fee and expenses, the total acquisition cost was about RM330 million, and that the mall had been independently valued at RM330 million. It said the four-storey mall, which was opened in April 2008, was the newest mall in Kuantan, and was part of a mixed development called Putra Square, which also comprised the 519-room Zenith Hotel and Sultan Ahmad Shah International Convention Centre, which has a seating capacity of 6,000 people. "Due to its location in Putra Square, East Coast Mall enjoys shopper traffic from hotel guests and visitors to the Convention Centre,” it said. CMRM said the mall has a nearly-full occupancy rate of 97.0%, with a forecast property yield of about 7.1%1 for 2011. “Based on CMMT’s closing price of RM1.17 on June 13, 2011, CMMT’s implied property yield for 2011 is about 6.4%2. “As such, this acquisition is yield-accretive to CMMT unitholders,” it said. CMRM said the acquisition would be funded through a combination of debt and equity, the latter of which will be raised via a proposed placement of up to 298.97 million new CMMT units to parties to be identified, at a price to be determined by way of bookbuilding. The number of new units represented up to 20% of CMMT’s existing 1.494 billion units, as authorised by unitholders at the unitholders’ meeting on March 10, 2011, it said. The acquisition and placement are expected to be completed by the last quarter of 2011, it said. CMRM chairman Kee Teck Koon said the acquisition of the East Coast Mall would provide CMMT the opportunity to penetrate into the retail sector in the East Coast of Peninsular Malaysia. “It will enhance CMMT’s income and geographical diversifications, and further strengthen CMMT’s position as the largest “pure-play” shopping mall REIT in Malaysia,” he said. CMRM chief executive Sharon Lim said the mall had been able to attract a variety of established Malaysian and international retailers such as Carrefour, Padini, Parkson, Sony Centre, Golden Screen Cinemas and Starbucks. “As such, East Coast Mall has become a popular destination among the people in Kuantan, and attracts a secondary catchment market from nearby towns in the neighbouring state of Terengganu,” she said.

https://theedgemalaysia.com/node/5375

Malaysian financial system has adequate buffers, says BNM

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KUALA LUMPUR: The Malaysian financial system is expected to remain resilient going forward even as downside risks remain during the recovery in the international and domestic economic and financial environment, Bank Negara Malaysia (BNM) said. "The bank will continue to ensure the readiness of its supervisory and surveillance capacity in detecting, monitoring and assessing emerging risks and threats to the stability of the Malaysian financial system to ensure timely and appropriate policy responses," BNM said in its Financial Stability and Payment Systems Report 2009 released on Wednesday, March 24. It said the surveillance and supervisory framework in Malaysia would continue focusing on six key areas this year, namely further enhancements to the macroprudential approach for assessment of risk transmissions within the financial system and the economy, more active and efficient use and development of surveillance tools and methodologies and continued engagement with stakeholders. BNM said other areas of focus were on financial institutions' risk management practices to ensure these commensurated with changes in risk appetite, more active and closer regional and global cooperation and coordination through multilateral platforms and bilateral arrangements, and understanding and assessing the impact of changes in the regulatory and accounting environment. The central bank added while domestic operating conditions were expected to improve as challenges in international and financial sectors subsided, downside risks to domestic financial stability stemming from the external environment remained, as the global recovery process could adversely affect sentiments and create uncertainties. It also said although other economies had undertaken measures to maintain the overall confidence level globally and domestically, the sustainability of the global economic recovery remained to be seen as pressures on international financial stability lingered. Of significance, BNM noted, was the removal of the "unconventional support measures" taken at the height of the global crisis and the withdrawal of fiscal stimulus, after the measures had been key in spurring the current improvements in global economic and financial conditions. "Hence, timely, coordinated, transparent and appropriately communicated exit policies would be key in ensuring a smooth transition process that preserves confidence and minimises adverse spillovers that could derail the current path to recovery," it said. The central bank added that effective and prompt solutions for sovereign debt concerns were vital to maintain stability in the international financial system, "to avoid widespread indirect implications on confidence levels and the path to global economic strengthening." It also said even as faster economic recovery in Asia alleviated concerns regarding weaker credit quality and rising delinquencies in the banking system, the large capital inflows into the region expected to follow posed new challenges in managing the potential translation into non-sustainable financial market rallies and a speculative build-up in asset prices and financial imbalances. On the progressive liberalisation of the Malaysian financial sector, BNM said this would contribute towards developing the industry further, while increasing its inter-linkages. Meanwhile, it said the Malaysian financial system was expected to continue be adequately buffered to withstand external risks and domestic challenges. "The banking system capitalisation is expected to remain above 10% under the most challenging and extreme scenario in the stress tests conducted on credit and market risks. "These scenarios are based on an unexpected and extreme reversal in regional and global economic growth, coupled with bearish sentiments in the financial markets and conditions that are comparable to the Asian financial crisis," BNM said. BNM also noted its development of a new blueprint for the financial sector, aimed at enhancing the role of the sector as an enabler, driver and catalyst of economic growth with more capacity to contribute effectively to the economic transformation process. It added another milestone this year which was its current review on the existing legislations governing financial institutions and intermediaries, including the promotion of a market-based environment for players to innovate while maintaining sufficient safeguards with adequate legislative powers for the central bank to ensure the preservation of financial stability. It also said the pension reform initiative currently being undertaken by the government would provide opportunities for the financial sector to play a role in providing retirement products, while in the insurance sector, progressive deregulation of rates and commissions would be pursued to promote greater competition and innovation. "On the consumer front, ongoing efforts towards improving financial literacy will be reinforced with initiatives to strengthen avenues for consumer redress. The establishment of a financial ombudsman and improved product transparency, particularly in the area of pricing, commissions, fees and charges will be implemented," it said. It added as regional integration intensified, Malaysia's financial sector was well positioned to benefit from opportunities emerging from these developments, while its competitive advantage in Islamic finance would provide a boost as it grew into an international hub for Islamic finance. "Moving forward, the potential of the financial sector to be a key enabler, driver and catalyst of economic growth will be reinforced, with commensurate enhancements to the regulatory and supervisory framework to support the orderly growth and development of the financial sector," it said.

https://theedgemalaysia.com/node/62609

Work on Daihatsu associate’s RM100m Seremban plant to start in March

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KUALA LUMPUR (March 7): Work on Daihatsu Motor Company associate Akashi Kikai Industry (M) Sdn Bhd’s RM100 million electronic automatic transmission (EAT) plant in Seremban is expected to start in March. Perusahaan Otomobil Kedua Sdn Bhd (Perodua) said on Wednesday that Akashi Kikai had allocated RM100 million for capital and the plant would tentatively be operational by November 2013 with some 120 workers. The EAT plant would make Malaysia a regional hub for the high-end automotive component. Perodua managing director Datuk Aminar Rashid Salleh said the new EAT plant was part of Daihatsu’s commitment to invest in Malaysia and also an important milestone for Perodua’s five-year strategic roadmap to become more competitive. “We are very happy that Malaysia was chosen for this project as it shows that the country is still a viable investment destination for investors,” Aminar said. Daihatsu is Perodua’s shareholder, technical and technology partner. Daihatsu has a 39% stake in Akashi-Kikai Industry, Japan-based Akashi-Kikai Industry Co Ltd 51% and Perodua 10%. Aminar said the joint-venture company would transfer high-end and high quality technology to Malaysia. Akashi-Kikai's business activities were limited to the manufacture and sale of electronically controlled automatic transmission units.

https://theedgemalaysia.com/node/31208

Apex court reserves judgment in UEM-Genisys battle

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PUTRAJAYA: The Federal Court reserved its judgment in the RM87 million commercial dispute between UEM Group Bhd and Singapore’s Genisys Integrated Pte Ltd after hearing submissions from both parties here yesterday. The hearing follows an appeal by UEM against the Court of Appeal’s decision in November 2008 that ordered the company to buy out Genisys’ 49% stake in their joint-venture company UEM Genisys Sdn Bhd (UEG) for RM47.28 million. UEM was also ordered to pay 8% interest per annum from April 2001 which brings the total to some RM87 million. The Court of Appeal had also found that UEM failed to establish a case of oppression under Section 181 of the Companies Act 1965 and also dismissed the government-linked company’s petition as well as set aside the High Court’s order to wind up UEG. At the apex court yesterday, UEM’s counsel Firoz Hussein brought to the attention of the three-judge panel that that purported breach of a shareholders’ agreement between UEM and Genisys was not a material consideration for oppression under Section 181. He submitted that the Court of Appeal had given “material consideration” to the terms of the shareholders’ agreement which in fact had remained a conditional agreement as it was never ratified by UEG by way of a resolution or incorporated into its Articles of Association. “The meaning of oppressive conduct under Section 181 is when the affairs of the company are being conducted in a manner oppressive to the members of the company,” said Firoz, who appeared before Justice Datuk Seri Md Raus Shariff sitting together with Datuk Abdull Hamid Embong and Datuk Heliliah Mohd Yusof. The shareholders’ agreement signed between UEM and Genisys back in 1993 for the 51:49 joint venture of UEG among others contained a pre-emptive clause which stated either party must first offer its share to the other partner if they planned to exit the joint-venture company. However, UEM had in mid-1998 offered to dispose of its shares to a third party named Nova Nusantara Sdn Bhd without first offering it to Genisys. Firoz also told the court that UEM had also not breached the shareholders’ agreement as it was merely negotiating with Nova Nusantara and that such shares were not sold, stressing “that is not a breach”. However, counsel for Genisys Gideon Tan argued that it was “purely academic” for the apex court to look into the need for ratification of the shareholders’ agreement as it did not relate to “oppression” which the appellant must prove. He noted that the only option for justice was for UEM being the majority shareholder in UEG to buy out the minority, adding that the Court of Appeal had rightly pointed out that UEM and Genisys could no longer work together after a string of disagreements. “The Court of Appeal has decided nobody has oppressed each other and it’s status quo for the nominee directors in UEG,” he said stressing that the court had applied Section 69(4) of the Courts of Judicature Act to do “complete justice” and prevent a protracted dispute between the two parties. Tan submitted that UEM owed UEG a huge sum and that it was Genisys that financed the last project under the joint-venture company, noting that the Court of Appeal realised that UEM had treated its partner “less fairly” and as such awarded interests to Genisys from year 2001 onwards. “This amount (RM47 million) is not a loss to UEM as the court-appointed valuer reported that Genisys was merely getting back its share of what was due,” he added. The apex panel told the counsels that they would be informed later when the decision would be made known. This article appeared in The Edge Financial Daily, June 4, 2010.

https://theedgemalaysia.com/node/9029

Economics Watch: MCMC chairman leaves despite offer

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MCMC COO Mohamed Sharil Tarmizi is currently the acting chairman. It is learnt that Halim, 60, vacated his position on April 30, one month after his three-year contract ended. Halim declined an extension to his contract for reasons not immediately known. “He (Halim) was offered an extension, but he did not want to continue, after one month,” a source tells The Edge. Industry members and fellow colleagues feted Kedah-born Halim at a farewell dinner at a hotel in Petaling Jaya last Friday, in recognition of his leadership and contribution to the industry as well as 37 years in public service. The soft-spoken Halim was appointed MCMC’s fourth chairman on April 1, 2006, succeeding Datuk V Danapalan who served from February 2004 to March 2006. Before that, Halim served as secretary-general of the Energy, Water and Communications Ministry from 2000 to 2006 and was the ministry’s deputy secretary-general 1 from 1999 to 2000. There had been speculation of Sharil being next in line for the MCMC chair last year, rumours which he had then dismissed as both untrue and inappropriate. Sharil, named COO on June 16 last year, was formerly executive director in niche financial advisory and consultancy firm Binafikir Sdn Bhd, now under the umbrella of Maybank Investment Bank Bhd. His first stint with MCMC began in May 2000 as senior adviser in the office of the chairman, and after six years experience with the regulator under his belt, he left to join Binafikir as its head of strategy. A lawyer by training, Sharil has been a commission member of MCMC from May 1, 2006, which is recognition of his experience in the international arena in which he worked closely with top international organisations, such as the Internet Corporation of Assigned Names and Numbers (ICANN) where he was a board member and past chairman of its government advisory committee. Halim’s contributions during his 37 years in public service include the formulation of regulations under the Communications and Multimedia Act, the formulation of Water Services and Industry Act & Water Services Commission Act in 2006, MCMC’s transformation in 2007, the formulation of the ubiquitous library framework through the consortium of national and public libraries in 2008, the schoolNet project in 2004 as well as following through the implementation of significant regulatory initiatives in the communications sector, such as prepaid mobile registration, mobile number portability, WiMAX broadband and the high speed broadband project. Halim, who was a student at the Malay College Kuala Kangsar, started his career in the civil service with the Ministry of Education in 1972. He also had stints at the National Institute of Public Administration  and the Malaysian Administrative Modernisation and Management Planning Unit in the Prime Minister’s Department.Halim is married with five children. This article appeared in The Edge Malaysia, Issue 756, May 25-31, 2009

https://theedgemalaysia.com/node/60159

Qantas to cut 1,000 jobs, says challenges ‘immense’

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SYDNEY: Australian carrier Qantas said it would axe 1,000 jobs and anticipates “immense” challenges ahead, in a shock profit warning on Dec 5, flagging a half-year loss of up to A$300 million (RM873 million). Chief executive officer Alan Joyce said conditions had seen a “marked” deterioration and the airline is battling “extraordinary circumstances”, including record fuel costs, a strong Australian dollar and fierce competition from subsidised rivals. The news sent Qantas shares into freefall, with the stock plunging as much as 17% to 99.5 Australian cents, before regaining ground to close 10.79% lower at A$1.075. “The challenges we now face are immense,” Joyce said, in an update to the Australian stock exchange.“Since the global financial crisis, Qantas has confronted a fiercely difficult operating environment — including the strong Australian dollar and record jet fuel costs, which have exacerbated Qantas’ high cost base,” he added. “The Australian international market is the toughest, anywhere in the world.” Qantas was optimistic that it had turned a corner, after signing a major partnership with Dubai-based Emirates and reversing its 2012 annual loss — the first since privatisation, with a modest A$5 million full-year profit in August. But the Dec 5 announcement shows that it is still facing significant headwinds. Joyce said Qantas expected to report a loss before tax in the six months to Dec 31, of A$250 million to A$300 million, with passenger loads slipping significantly in November, as increased competition drove down the carrier’s market share. Fuel costs for the half-year were A$2.27 billion — A$88 million higher than in the second half of 2012. “Urgent” action was needed to salvage the Flying Kangaroo’s profitability, Joyce said, including the sacking of “at least 1,000” staff, a 38% cut in his own pay and that of the Qantas board, a review of spending with top suppliers, and a salary and bonus freeze. “We have reduced the group’s unit costs, excluding fuel, by a total of 19% since FY09 [financial year 2009], including by 5% in FY13. But these actions are not enough to deal with the current situation,” he said. The airline will undertake a structural review, to report back in February, prompting speculation that a sell-off of its Jetstar assets in Asia, could be on the cards. “All options are on the table, in terms of the structural review; we’re not ruling anything in or anything out,” Joyce said, when asked about potential divestments. He added that Qantas was “in dialogue with the government, on a number of different options”, as he continues lobbying for the easing of foreign investment restrictions or state intervention, to shore up the carrier. Under the Qantas Sale Act, dating from 1995 when the airline was privatised, foreign ownership in the national carrier is limited to 49%, and Joyce wants that revisited, in the face of what he described as “unprecedented distortion” by foreign backers of the Australian market. “Our competitors in the international market, almost all owned or generously supported by their governments, have increased capacity to pursue Australian dollar profits, changing the shape of the market, permanently,” the Qantas chief said. He again took aim at domestic rival Virgin Australia, which is now majority owned by state-backed Singapore Airlines, Air New Zealand and Etihad, accusing it of a deliberate “strategy to weaken Qantas in the domestic market”, with cheap seats underwritten by foreign cash injections. “Essentially, what’s happened is three state-owned entities have gotten, through the back door, access to Australian traffic rights,” he said. Joyce has been locked in a bitter war of words with Virgin in recent weeks, over what he has described as “predatory” behaviour by his rivals. — AFP This article first appeared in The Edge Financial Daily, on December 6, 2013.

https://theedgemalaysia.com/node/10338

The Right Timing: Overhead resistance at 1,085-1,120

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KLSE COMPOSITE INDEX (June 26, 2009) Technical readingsElliott WaveDaily chart: By using a short-term Elliott Wave count, the Kuala Lumpur Composite Index (KLCI) continues to unfold the various degrees of the impulsive A-B-C waves of its major corrective wave (B). The KLCI closed at 1,075.77 points last Friday.Weekly chart: The KLCI’s weekly wave counts were in line with that of its daily wave counts. Elliott OscillatorThe KLCI’s Elliott Trigger had since stayed below its zero region while its Elliott Oscillator continued to stay above its zero region. Other IndicatorsIts weekly stochastics stayed in its overbought levels. Its daily and monthly stochastics stayed in their respective neutral levels. Moving Average Convergence/Divergence (MACD)The KLCI’s weekly fast MACD continued to stay above its weekly slow MACD. Its daily and monthly fast MACDs continued to stay below their respective slow MACDs. Expert Trend IndexThe readings are “neutral”, “bullish” and “neutral” for short, medium and long term, respectively. Profit Taking Index (PTI)Using the original Elliott wave count, PTI displays high readings of 99 and 80 on its daily and monthly charts respectively. Displaced Moving Averages (DMA)The KLCI continued to stay above its daily and weekly DMA levels of 1,065 and 939 respectively. It continued to stay below its monthly DMA level of 1,157. DivergenceThere were positive divergences on its daily MACD, Stochastics and Relative Strength Index to KLCI’s daily chart. Make Or Break (MOB)The revised weekly MOB resistance is further revised lower to its overhead resistance of 1,100 to 1,200. The KLCI hit its all-time historical high of 1,524.69 on Jan 14, 2008. SupportThe KLCI’s immediate downside support is now revised to 1,020-1,050 levels. It staged a successful re-test of the support when it hit its intra-week low of 1,028.14. ResistanceIts immediate overhead resistance is now revised to the 1,080—1,120 levels. It hit its intra-day high of 1,095.91 on June 12.     FTSE BURSA MALAYSIA SECOND BOARD INDEX Technical readingsElliott WaveDaily chart: The FBM2BRD closed at 4,798.80 points last Friday.Weekly chart: The market is seen to unfold a technical rebound in the medium term. No significant sign of a REVERSAL from the downside. Monthly chart: Likewise, it has not completed the downside cycle in the long term yet. It is unfolding a technical corrective WAVE 4. Elliott OscillatorThe FBM2BRD’s Elliott Trigger stayed below its zero region while its Elliott Oscillator continued to stay above its zero region. Other IndicatorsIts weekly stochastics stayed in its oversold level while its daily and monthly stochastics stayed in their respective neutral levels. MACDThe FBM2BRD’s daily and weekly fast MACDs stayed above their respective slow MACDs. Its monthly fast MACD stayed below its monthly slow MACD. Expert Trend IndexThe readings are “neutral”, “bullish” and “neutral” for short, medium and long term, respectively. PTIModerate readings are seen on the daily, weekly and monthly charts, suggesting that the market is unlikely to re-test the low of 78 for the long-term support. DMAThe FBM2BRD had since stayed above its daily, weekly and monthly DMA levels of 4,315 and 4,265 and 4,745 respe3ctively. DivergenceThere were no negative divergence on its daily stochastics and Relative Strength Index to the FBM2BRD on its daily chart. MOBThe FBM2BRD’s MOB support is now revised to the 4,400-4,600 level.     FTSE BURSA MALAYSIA MESDAQ INDEX Technical readingsElliott WaveDaily chart: The FBM-MDQ’s recentimpulsive wave was terminated in tandem with that of the KLCI. It closed at 4,116.97 points last Friday.Weekly chart: The FBM-MDQ has yet to complete the retracement of its corrective A-B-C waves of its major corrective wave (B). Monthly chart: Its wave retracement had completed the first leg of its intermediate-term correction. It is currently unfolding the second leg of its wave correction. Elliott OscillatorThe FBM-MDQ’s Elliott Trigger stayed below its zero region while its Elliott Oscillator continued to stay above its zero region. Other IndicatorsThe FBM-MDQ’s weekly stochastics stayed in its overbought level. Its daily and monthly stochastics stayed in their respective neutral levels. MACDThe FBM-MDQ’s weekly fast MACD stayed above its weekly slow MACD. Its daily and monthly fast MACDs stayed below their respective slow MACDs. Expert Trend Index“Bullish” and “neutral” readings continued to register for the medium and long-term perspective respectively. Its short-term reading had since turned “neutral” for the moment. PTIUsing the original Elliott wave count, PTI had since rebounded to 73 on its daily chart while it dropped to 19 on its weekly chart. DMAThe FBM-MDQ continued to stay above its daily, weekly and monthly DMA levels of 4,033, 3,429 and 4,135 respectively. DivergenceThere were significant negative divergences on its daily MACD and Relative Strength Index to the FBM-MDQ on its daily chart. MOBThe FBM-MDQ’s MOB support is now revised to the 4,000-4,100 levels. ResistanceThe FBM-MDQ’s next resistance is now raised to the 7,400 level. SupportIts immediate downside support is revised to the 4,000-4,200 levels. ResistanceIts immediate upside resistance hovers at the 7,000 level. Market reviewShare prices consolidated last Monday before rebounding towards the end of the week. The KLCI continued to stay above its major psychological resistance of 1,050 when it closed at 1,075.77 points last Friday. It rebounded from its intra-week low of 1,028.14 last Tuesday to its intra-week high of 1,081.83 last Friday, giving an intra-week trading range of 53.69 points. Based on the trading activities as at June 26, the KLCI traced out a w-o-w gain of 16.27 points, or 1.54%, to 1,075.77. The FTSE Bursa Malaysia Mesdaq Index lost 22.54 points, or 0.54%, to 4,116.97 while the FTSE Bursa Malaysia Second Board Index eased 15.35 points, or 0.32%, to 4,798.80. Market outlookRenewed buying support for key heavyweights helped prop up the KLCI. Its weekly fast MACD continued to stay above its weekly slow MACD. Its daily and monthly fast MACDs continued to stay marginally below their respective slow MACDs. Last week, this column commented that key heavyweights are likely to provide the momentum in maintaining the KLCI’s technical composure. They did. After the technical pullback last Monday, the key counters rebounded to help reverse the falling field trend. This week, the KLCI is likely to stage a follow-through rebound in its run-up to the window-dressing exercise on June 30. The KLCI is likely to slip into another consolidation during the later part of the week. Its overhead resistance is at 1,085 to 1,120 while downside support is at 1,035 to 1,070.   This article appeared in Capital page of The Edge Malaysia, Issue 761, June 29-July 5, 2009

https://theedgemalaysia.com/node/40893

Domestic demand emerging at Ann Joo

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Ann Joo Resources Bhd(Nov 29, RM2.79)Maintain buy at RM2.86 with target price of RM3.05: Ann Joo Resources’ 9MFY10 net profit of RM123 million made up 69% of our and consensus’ full-year forecast. We consider this to be within our expectations as Ann Joo is likely to report a rebound in earnings in 4QFY10 on higher sales volume and better average selling prices (ASPs). We remain positive on Ann Joo given our expectation of a domestic demand rebound in 2011/12. We maintain “buy”, with an unchanged RM3.05 target price (11 times fully diluted 2011 PER). Key takeaways from 3QFY10 results: (i) Net profit fell to RM10 million (-77% year-on-year, -85% quarter-on-quarter) on lower manufacturing sales volume of 126,000 tonnes (-21% y-o-y, -45% q-o-q) as management held back sales to the export market in view of weak ASPs. Export sales tonnage fell substantially by 86% q-o-q and only accounted for 13% of total sales volume (2Q10: 50%); (ii) Group earnings before interest and tax (Ebit) margin dropped to 5.7% (-8.2 percentage points y-o-y, -8 percentage points q-o-q) on weak steel ASPs of estimated US$560 per tonne (-10% q-o-q) and higher scrap inventory; and (iii) Net gearing increased to 1.2 times (June 2010: 1 time) due to higher utilisation of trade facilities as inventory level rose to RM1.2 billion (+21% q-o-q).We understand that domestic steel demand is edging up slowly, driven by the recently awarded KLIA2 project. Ann Joo has also resumed exports since October, with 20,000 tonnes transacted, and is in the processof concluding another 20,000 tonnes of sales (against 16,000 tonnes in 3QFY10). We are also encouraged that steel demand in China remains firm, as evident from the rising steel ASPs of US$680 per tonne in China (around 6% premium to our local steel ASPs). We anticipate earnings to rebound in 4QFY10 owing to restocking activities and better ASPs. Additionally, Ann Joo’s mini blast furnace (+30% billet capacity by January 2011), in the final stage of construction of the auxiliary facilities (underground pipe-laying), will help the company to save costs (lower energy and scrap usage) and catch the domestic steel recovery in 2011/12. We maintain our earnings forecasts, rating and target price. — Maybank IB Research, Nov 29 This article appeared in The Edge Financial Daily, November 30, 2010.

https://theedgemalaysia.com/node/19610

Coffee Break With... : Thank god, it's Thursday?

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There is a saying by a furry, lasagne-loving, tabby-striped philosopher about Mondays, or more specifically his hatred of them. One of my particular favourites is where he says to his human owner, “You know it’s Monday when you wake up, and it’s Tuesday.” We all know what Monday blues feel like. Although there are those who come in Monday morning all perky and refreshed (they do exist, trust me), there are those you would not approach until they’ve had their first… second… or even third cup of java. Of course, recently, we all had the luxury of three-day weekends thanks to a couple of well-timed public holidays. But here is a tantalising thought: what if that became permanent? Would Mondays be more bearable if you knew that the weekend was only three short days away? “Four-day work weeks? That’s a nice dream, but no way. At the moment, even though I’m only expected to work 5½ days a week, I still find myself getting work calls on Sunday... in the middle of watching Formula One!” laments a merchant banker over the phone. And his reaction wasn’t unique. Most people I asked about four-day work weeks display a wistful look in their eyes but then shook their heads with a wry grin as they all fervently believe that “it isn’t gonna happen”. But such is exactly the reality in the US state of Utah. A year go, Republican governor Jon Hunstman announced an initiative called “Working 4 Utah”, where he placed 17,000 of the state’s 24,000 executive branch employees on a 10-hours-a-day, four-days-a-week schedule. More traditionally, the hours of those on the state’s payroll spanned eight hours a day for five days. The ultimate goal for the cash-strapped state in doing this was to achieve energy savings. However, a year down the road, most of the benefits of the initiative have gone beyond that, according to reports.In addition to energy savings (Utah saw a 13% cut in energy usage), morning traffic became more bearable, the workers were healthier and happier, and productivity was up. It was reported that the initiative even worked as a kind of economic stimulus, putting the cash saved from commuting back in the pockets of the workers. Apparently, its success inspired other states such as Texas and Florida to implement their own TGIT (Thank goodness, its Thursday… geddit?) initiatives. All right, admittedly this initiative is mostly for the public sector rather than the private, but it doesn’t seem that impossible for workers to switch. After all, isn’t getting a task done in a shorter amount of time considered productive? The idea of a third day off is seriously tempting: more time for yourself, your family and doing other things in life. However, not everybody I spoke to were sold on this. “I can believe everything about that except the traffic bit. Maybe that is how it works in the US, but here all the traffic jams would now be around the shopping malls during the third off-day,” quips a friend. “And yes, at the moment, economic stimulus is the ‘in’ thing. What about when the economy picks up? Will people be happy just sitting back instead of making hay while the sun shines?” Also, maybe it is something to do with our culture, where it is drilled into us that working and contributing to society justifies our existence (seriously, that is what somebody said to me). And even I admit that, at times, there never seems enough hours in the week to complete all that needs to be done at the office. So, why cut the nose to spite the face? Still, no one can be blamed for dreaming of three days off each week, right? This article appeared in The Edge Malaysia, Issue 772, Sep 14-20, 2009.

https://theedgemalaysia.com/node/18267

Bursa Suq Al-Sila' sees first cross-border transaction

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In a statement today, Bursa said the money-market murabahah transaction was conducted by Gatehouse Bank plc of UK with CIMB Islamic Bank. Bursa chief executive officer Datuk Yusli Mohamed Yusoff said the new development strengthened Bursa Suq Al-Sila's global appeal to facilitate syariah financing by undertaking multi-currency transactions. "We believe that this first international trade will lead to more cross-border Islamic transactions by foreign financial players as this development affirms the viability of Bursa Malaysia's fully syariah commodity platform in facilitating financing beyond borders," he said. The trade was witnessed by Gatehouse Bank's CEO Richard Thomas, Bursa Malaysia's Global Head of Islamic Markets Raja Teh Maimunah and CIMB Islamic Bank's CEO Badlisyah Abdul Ghani. Bursa said this latest development followed the successful launch of Bursa Suq Al-Sila' last month. The fully electronic platform is an international commodity platform that is able to facilitate commodity-based Islamic financing and investment transactions under the syariah principles of murabahah, tawarruq and musawwamah, it said.

https://theedgemalaysia.com/node/69056

#Opinion* The PAS polls, in the eyes of the Chinese

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Last Updated: 10:47am, Nov 22, 2013 THE Chinese do not give two hoots for the PAS elections? What more the Muktamar or the party’s general assembly? Yes, say some Chinese political observers. A few years ago but not anymore, they went on to say. Meaning the Chinese community is casting an eye on the big PAS election. Although we are not talking numbers here. So to those watching the polls what do they hope to see? “Liberal and open minded people winning”, said an observer on Chinese affairs. That is given. “True”, said another observer. The Chinese now, he said, “trust” PAS more than Umno. “The barriers between the community and PAS have been broken since 2008. PAS do not put down the Chinese like Umno do. PAS handle religious issues better than Umno. Using hudud to frighten the Chinese is not working anymore. PAS is more liberal than Umno,” said the observer. But surely the Chinese must be aware of the presence of leaders seen as “hardliners” in PAS?  “That’s why we hope leaders who are liberal and open minded win”, was his reply. A political pundit who used to be an aide of a well-known former federal minister from the MCA have this to say: “It appears that the Chinese are pragmatic, in that they are willing to forget PAS’ objective of establishing an Islamic state for the time being in their immediate goal to push Umno/BN out of power. They certainly prefer liberals to continue working with allies in Pakatan Rakyat to capture Putrajaya. The Chinese do not want relations between PAS-PKR-DAP disrupted. They understand PAS needs to strike a balance between ulamas and professionals. But the Chinese do not think PAS will change its current policies including its active participation in Pakatan Rakyat as they believe PAS is realistic enough to stay together in Pakatan to capture Putrajaya. It cannot achieve that goal alone or by cooperating with Umno. Obviously, the Chinese know all too well for any political force to rule the country there must be a dominant Malay/Muslim party in it - due to the realties and political landscape of Malaysia. Hence BN have Umno playing the role of anchoring the coalition of multiracial components. “PAS can do that and must replace Umno as the party of the Malays thus be prominent in Pakatan,” said Hu Pang Chau. Obviously Hu fully “trust” and have “confidence” in PAS. He is after all chairman of PAS Supporters Congress. So, it’s another given he have “kind words” for the party. To detractors Hu is “merely a PAS apologist”. That is the “nicest compliment” thrown at him. But it is said Hu do not get paid to do what he do. Neither is he given government positions in Kelantan. And he had his share of “rub-ins” with the Kelantan authorities over issues he sees as “imposing on non-Muslims”. And he’s still standing. “In past Muktamar, I’ve hit out at weaknesses of the party. If you love somebody you must not only say nice things. You must criticise things that’s not right so that things get better. “This Muktamar I am going to criticise again. The focus is GE14. We must act now. In GE13 we performed below par. The next general election we must win at least 50% of the seats we contest. “We must implement whatever that’s decided at the Muktamar. We must delete NFA or no further action from the PAS dictionary. Many times in the past, after the Muktamar resolutions passed came to nothing. NFA,” said Hu. New resolutions apart, there are issues at hand which PAS need to settle. Like the spat with DAP’s Karpal Singh over the “call for the dissolution of race-based parties,” the spat with the DAP-led Pakatan government of Penang, the voices of dissent within, against the leadership’s stand on the usage of the word “Allah”. There are others of course. I must end with a “story” related by a close Chinese friend of mine a few days after the 2008 general election. His mother was the “wakil calon” for the MCA candidate contesting a federal seat against a candidate from PAS .Among her tasks was to monitor the vote counting process. According to my friend,  his mum told him that when ballot boxes from voting centres located at new villages were opened, the votes were all for the PAS’ candidate. “My mum nearly fell off her chair. Imagine Chinese from new villages who were all the while scarred of anyone wearing the white kopiah are now voting for PAS,” said my friend. Needless to say the MCA man lost. My friend’s mum is still with MCA. Morale of the story? Feel free to conclude. For more stories, go to www.fz.com, the website for freedom of expression and fairness in articulation.

https://theedgemalaysia.com/node/81250

Alliance IB Research starts coverage on UMW Oil & Gas, target price RM3.16

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KUALA LUMPUR (Oct 14): Alliance IB Research has initiated coverage on UMW Oil & Gas Corporation Bhd (UMWOG) with a Buy rating at the IPO price of RM2.80 and target price of RM3.16 and said the company was well positioned to benefit from intensified oil & gas exploration activities in the region, which was going to drive drilling activity up by 15% from FY12 and also push up daily charter rates. In a note Monday, Alliance IB Research analyst Arhnue Tan said she expects that the group would be able to chart a 3-year EPS CAGR of 58% going forward, driven by the addition of at least 2 new rigs by FY15 and securing steady charters for the NAGA 2, NAGA 3 and NAGA 5 rigs. “Despite CY14 P/E of 21.7x, UMWOG’s valuation is attractive given its PEG of 0.4x vs peers at 1.3x. “We are initiating coverage on UMWOG with a Buy recommendation and a target price of RM3.16,” she said.  

https://theedgemalaysia.com/node/84027

#Market Close* KLCI ends flat in cautious trades ahead of election

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KUALA LUMPUR (April 22 ): The FBM KLCI which opened at its day's low had vacillated between gains and losses before ending flat. This came amid cautious domestic pre-election sentiment and gains in regional markets. At 5pm, the KLCI rose 0.4 point or 0.02% to 1,706.68 on gains by selected blue-chips such as Genting Malaysia Bhd and Malayan Banking Bhd. The KLCI had begun the day at its intraday low of 1,702.47 before reaching a high of 1,709.49 at 9.10am. Across Bursa Malaysia, some 785 million shares worth RM1.35 billion changed hands. There were 212 gainers versus 463 decliners. The top gainer was Jerasia Capital Bhd while Nestle (M) Bhd led decliners. The most-active stock was Solution Engineering Holdings Bhd. Analysts see cautious sentiment "ahead of the polling day" in Malaysia on May 5 this year. Hong Leong Investment Bank Bhd research head Low Yee Huap said given the strong foreign interest and high cash holdings of domestic institutional funds and retailers, market weakness ahead of the election is expected to offer bargain-hunting opportunities and cushion any sharp fall in the KLCI. This comes amid anticipation that the KLCI may play catch-up against regional bourses’ strong year-to-date gains once the election risk in Malaysia is removed, Low said. TA Securities Holdings Bhd analyst Stephen Soo said the KLCI's overbought technical momentum and weakening trend indicators suggest that the current uptrend for the benchmark is waning. Hence, Soo expects further profit-taking this week until the overbought momentum is neutralised. "Moreover, weak buying momentum last week, as most investors were sidelined ahead of the nomination of candidates for the 13th general elections, suggests that the current subdued trading sentiment could persist up to election day," Soo wrote in a note today. Across Asia, Japan's Nikkei rose 1.89%, Hong Kong's Hang Seng added 0.14% while Singapore's Straits Times rose 0.4% Reuters reported that Japanese shares powered to nearly 5-year highs and determined sellers just failed to breach the symbolic 100 yen/dollar level on Monday, even though the Bank of Japan's bold reflationary plans were endorsed by the Group of 20 gatherings in Washington.

https://theedgemalaysia.com/node/989

#Update* Fairus: I will stay on as ADUN

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In a texted message to The Edge Financial Daily, Fairus said he would not vacate his seat. "I will stay on as ADUN (ahli dewan undangan negeri)," was his brief response on whether he would also give up his position as a state assemblyman. However, he remained silent when asked if he would quit Parti Keadilan Rakyat (PKR) and join other political parties. Meanwhile, Penang Chief Minister Lim Guan Eng still refused to say whether Fairus would give up the seat and also remained mum despite repeatedly being asked about the reasons for Fairus' resignation. The Penanti state seat falls within the Permatang Pauh parliamentary seat which PKR leader Datuk Seri Anwar Ibrahim won in a by-election in August last year. "It is not for me to say that Fairus should vacate the seat as it is a PKR seat," Lim said. "It is up to Anwar to decide on whether the seat would be vacated. "As of now, Fairus' term as DCM and executive councillor would end on April 7 and until then everything is status quo," he added after officiating the opening of E-Galv Steel Industry Sdn Bhd in Perai. Though speculation about the resignation had been rife for weeks with even text messages on it making rounds, Lim had always brushed it off as just rumours. All that ended when Fairus faxed his resignation letter to Lim's office on Saturday. Fairus, 33, who already has two master's degrees and was chosen over others for the post due to his impressive educational background, is said to be keen to further his studies. Since accepting the posts, Fairus has always been in the limelight for the wrong reasons. Among his failures were his dismal leadership of the Football Association of Penang (FAP), which ended with him having to quit the chairman's post. In recent days, Fairus was also relieved of his religious affairs committee which was given to another PKR executive councillor Abdul Malik Abul Kassim. Fairus is also said to be implicated in corruption charges related to quarries in his constituency, but has brushed these off as conspiracies by those out to get him. Despite being named as the chairman of InvestinPenang Berhad, sources said Fairus never once showed up for any meetings during the past year. He was also said to be conspicuously missing from Penang Development Corporation (PDC) and Perbadanan Bekalan Air Pulau Pinang (PBAPP) board meetings, where he had been appointed as director. A few months after assuming the post, Fairus was openly chided by Anwar following complaints from his constituents about Fairus' lethargy and failure to serve the constituency well. Meanwhile, Lim said though DAP was not contesting the Batang Ai, Bukit Gantang and Bukit Selambau by-elections, DAP would go all out to ensure victory for the Pakatan Rakyat in all three seats.

https://theedgemalaysia.com/node/98869

Dayang orders offshore workboat worth RM70m

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KUALA LUMPUR (Sept 5): Dayang Enterprise Holdings Bhd is expanding its fleet size by acquiring a vessel to provide marine support services to its offshore oil and gas (O&G) facilities. In a filing with the stock exchange, the O&G maintenance and support provider said that to expand its fleet, the group has entered into a shipbuilding contract with Shin Yang Shipyard Sdn Bhd today. The contract stipulates the construction and delivery of one unit of offshore accommodation workboat worth an estimated RM70 million, it said. “This new vessel is expected to contribute positively to the future earnings and net assets of the company for the financial year ending Dec 31, 2015 and beyond,” said Dayang Enterprise. The group said the acquisition would be funded by internally generated funds and bank borrowings. The new vessel is scheduled for delivery by the fourth quarter of 2014, it said.

https://theedgemalaysia.com/node/26628

EON Bank sets RM200m target for bancassurance

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KUALA LUMPUR: EON Bank Group is targeting RM200 million worth of bancassurance business in 2010, a jump of about 90% from last year, on expectation that its tie-up with Uni.Asia Life Assurance Bhd would contribute a portion of the growth, group chief executive officer Michael Lor said. Under the collaboration, Lor said EON Bank expected to sell RM10 million of Uni.Asia's Wealth Plus savings plan product at the end of its three-month "Power of Love" promotional campaign period. "We are conscious of the market and this product will meet the need," he told reporters at the launch of the campaign today. "Power of Love" comes with a free heart-shaped 916k gold pendant worth about RM200 as a Valentine's gift and a Chinese New Year ang pow. Wealth Plus offers a 5% guaranteed annual cash back on sum assured.

https://theedgemalaysia.com/node/29112

Market recovers, CIMB leads

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KUALA LUMPUR: Blue chips staged a mild rebound in the early trade on Wednesday, March 17 after several days of selling as investors sentiment perked up following the firmer overnight close on Wall Street, with CIMB among the gainers. At 9.41am, the FBM KLCI was up 4.28 points to 1,303.14. Turnover was 100.68 million shares valued at RM99.48 million. The broader market was firmer with  204 gainers, 85 losers and 161 stocks unchanged. RHB Research Institute said the formation of a “morning star” candle suggests a potential technical rebound ahead, even as it failed to sustain its early rebound momentum at above the crucial psychological support level of 1,300 on Tuesday. More importantly, the FBM KLCI started to show some stabilisation signs nearer the 1,300 support region after correcting more than 35 points in the past four trading days. RHB Research said the recent overbought situation has largely been corrected with the daily stochastic oscillators and 14-dayRSI falling into the “very oversold” and “neutral” region respectively, from the recent “very overbought” and “overbought” region. “All these encouraging technical signs as well as the overnight US gains should pave way for a technical rebound soon. Once bargain-hunting supports pick up, it will attempt to reclaim the 1,300 level and the 10-day SMA of 1,307 in bids to resume the recent bullish breakout momentum towards the recent high of 1,334.34,” it said. Hai-O, whose bonus shares and share split went ex on Tuesday, rose the most, adding 15 sen to RM4.83. Measat gained three sen to RM2.29 while Maxis fell four sen to RM5.25. Kulim and KL Kepong added 14 sen each to RM7.52 and RM16.54 while MISC-F and DiGi advanced 10 sen each to RM8.10 and RM22.60. Among banks, CIMB rose 12 sen to RM13.68 and EON Cap eight sen higher at RM6.99. However, HL Bank fell nine sen to RM8.61 and Public Bank foreign eased six sen to RM11.62. Poultry-based DBE Gurney was the most active with 9.68 million shares done, rising 1.5 sen to 25.5 sen.

https://theedgemalaysia.com/node/1483

Shares fall on low volume

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The March 5 281-point loss sent the Dow Jones Industrial Average to its lowest level since April 1997 while the broader-based Standard & Poor’s 500 is now at its September 1996 lows. Investor confidence was clobbered by the speculations that General Motors may soon be filing for bankruptcy. The beleaguered automaker had received some US$13.4 billion in government bailout money but is asking for more just to survive the year. The company is burning through its cash rapidly amid the sharp slump in car sales. General Motors reported almost US$31 billion losses in 2008. The sell off was also partly attributed to expectations that March 6’s US employment report will mark the worst month for job losses since the start of the recession in December 2007. Elsewhere, investors were disappointed that China did not announce any additional stimulus measures. The Chinese government did reiterate its 8% growth estimate for the year. But few are convinced that the country alone could lead the world out of its current slump.  Meanwhile, the Bank of England halved its interest rate to 0.5% while the European Central Bank lowered its rate to 1.5% – the lowest levels since both banks were founded. With interest rates in the US and Japan already near zero, governments are running out of alternative with respect to monetary policies. The KL Composite Index closed 11 points lower at 858.2. Big losers include blue chips Tanjong plc, MPI, Maybank and Public Bank. Market breadth was overwhelmingly negative throughout the day. At the close, losing counters outnumbered gaining ones by three to one. Trading volume was razor thin as investors saw no incentive to enter the market. Just over 282 million shares were traded on March 6.

https://theedgemalaysia.com/node/2328

Govt invites public feedback on budget

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“Encouraged by the many responses and comments I have received previously via this website, once again I seek your compact suggestions this week on what measures or incentives may be included in the budget,” Prime Minister Datuk Seri Najib Razak wrote on his website (http://www.1malaysia.com.my/). According to Najib, who is also the finance minister, suggestions must be specific and focus on how Malaysia is to become a high level-income nation. “Suggestions should also relate to the six national key results areas (NKRAs),” said Najib. The premier said after his briefing by Bank Negara Malaysia on Monday that he felt that the country had no choice but to transform “economic activities in the right subsectors to become a high level-income nation”.Najib is due to present the 2010 Budget to parliament on Oct 23.

https://theedgemalaysia.com/node/99538

#Outlook* Higher supply, lower China/India demand to curb CPO prices

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KUALA LUMPUR (Sept  11): Malaysian oil palm plantation firms may have to contend with lower crude palm oil (CPO) prices in the near term. Analysts said today this is in anticipation of higher supply of the commodity amid lower demand from major importers China and India. Hong Leong Investment Bank Bhd analyst Chye Wen Fei said the research firm is maintaining its average CPO price forecast at RM2,500 and RM2,600 a tonne in 2013 and 2014 respectively. This is "pending further review with downward bias", Chye said. "We are holding to the view that inventory will remain on the uptrend for the next few months on the back of seasonally higher production, the absence of seasonal demand that will result in exports growth to China tapering off, and depreciation of rupee, coupled with bumper soybean crop in India,” added Chye who has an "Underweight” rating on the oil palm plantation sector. Chye's view follows the Malaysian Palm Oil Board’s (MPOB) latest release of palm oil data. MPOB said yesterday local CPO output rose 3.61% to 1.74 million tonnes in August this year from 1.67 million tonnes a month earlier. Palm oil inventory increased 0.11% to 1.67 million tonnes from 1.66 million tonnes. But palm oil exports climbed 7.37% to 1.52 million tonnes from 1.42 million tonnes. However, Bloomberg reported today that palm oil for November delivery advanced as much as 0.7% to RM2,367 a metric tonne and ended the morning session at RM2,360. Palm oil for physical delivery in September was at RM2,380 yesterday. Anticipation of weaker global CPO demand has also dragged rival oil palm producing nations into the spotlight. Fitch Ratings said Asian plantation firms' performance over the next 18 months hinges on the intensity and duration of demand decline. Fitch wrote in a note that regional firms, including those in Indonesia, face key challenges including declining trend in prices and inventory accumulation in Malaysia. Malaysia and Indonesia collectively command a global CPO market share of more than 85%. "The stable demand environment is being threatened by lower exports to the two largest CPO importers, China and India; India being affected by a currency slide. "CPO companies have withstood prices falling below USD750 (RM2,456 ) / tonne since January 2007, but such low prices have prevailed only for relatively short periods of four to seven months," Fitch said. Although lower CPO prices have resulted in lower revenue and operating profit, besides higher financial leverage for Asian plantation firms, Fitch said their financial metrics are still in line with ratings. "Indonesian and Malaysian CPO companies have maintained their credit profiles on the back of stable demand, despite the lower prices. Key risks are the intensity and duration of a potential demand slowdown, which may in turn depress prices further.

https://theedgemalaysia.com/node/18033

Midday Market: KLCI remains in negative territory as regional markets sag

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KUALA LUMPUR (Jan 24): The FBM KLCI remained in negative territory at the midday break on Friday ahead of the holiday shortened trading next week to observe the Chinese New Year festival as all as in line with the soggy regional markets. At 12.30pm, the benchmark index fell 4.85 points to 1,803.46. The index had earlier fallen to its intra-morning low of 1,798.57. Bears were in control with losers leading gainers by 456 to 185, while 274 counters traded unchanged. Volume was 784.03 million shares valued at RM851.23 million. The top losers included KLK, Dana Infra, BAT, Hong Leong Capital, HLFG, PPB, Genting Plantations, Cahya Mata Sarawak and Daya Materials. Iris Corp was the most actively traded counter with 69.42 million shares done. The stock rose 3 sen to 41 sen. The other actives included Tiger Synergy, SILK Holdings, XDL, Kretam, Sumatec, Daya Materials and KNM. The gainers included United Plantations, CIMB, The Store, Nestle, PBA, Bumi Armada, Hong Leon Industries, JobStreet, Gas Malaysia and Axiata. Maybank IB head of retail research and chief chartist Lee Cheng Hooi in  note to clients Friday said the FBM KLCI’s resistance level of 1,808 and 1,838 would cap market gains, whilst weaker support levels were at 1,790 and 1,803. “We recommend a “Sell on Rallies” stance for the index. “Due to the softer US performance, we expect the FBMKLCI to be much weaker as the index tests 1,800 and below today on foreign selling. We expect an imminent waterfall decline very soon for the index,” he said. Elsewhere, Asian shares lurched to a 4-1/2 month low on Friday, extending the previous day's weakness as disappointing Chinese manufacturing data raised concerns over the economy, and investors sought safety in gold and the yen, according to Reuters. MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.5 percent, adding the previous session's 1.3 percent decline following the Chinese factory activity report, it said. Elsewhere, Asian shares were off-colour on Friday, extending the previous day's weakness as disappointing Chinese manufacturing data raised concerns over the economy, and investors sought safety in gold and the yen, according to Reuters. MSCI's broadest index of Asia-Pacific shares outside Japan slipped 0.1 percent, having fallen 1.3 percent in the previous session to a 4-1/2 month low following the Chinese factory activity report, it said.

https://theedgemalaysia.com/node/509

TM’s UniFi ups ante on broadband competition

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KUALA LUMPUR: Broadband providers throughout the nation, and one television broadcaster, will have to keep a careful eye on their market share after Telekom Malaysia Bhd (TM) yesterday announced a highly competitive pricing scheme for its new high-speed broadband retail offering, also known as UniFi. At RM149 per month for the entry level retail plan, VIP 5, subscribers will receive up to a five megabit per second (mbps) transfer rate. At that speed, a typical song file of about five megabytes in size will take, on paper, eight seconds to transfer. The next plan, VIP 10, subscribers will see a connection speed of 10 mbps for RM199, while the premium plan, VIP 20, will provide subscribers with a speed of 20 mbps for RM249. While critics would argue that TM’s high speed service will only be available in Zone 1 areas, that is, areas of high economic impact, TM’s CEO Datuk Zamzamzairani Mohd Isa announced yesterday at a press briefing that it would also lower the price for its fastest StreamyX broadband plan. The latter falls under TM’s broadband for the general populace (BBGP), which is TM’s broadband offering in areas falling into the Zone 2 category. “Obviously, we need to adjust the pricing for the 4mbps plan on Streamyx. Today, we have the combo package available at RM160, (but) with immediate effect, we will reduce it to RM140,” Zamzamzairani said.The pricing of the plans came after the launch of the National Broadband Initiative and the National High Speed Broadband Project by Prime Minister Datuk Seri Najib Razak on Wednesday night. TM’s UniFi service will be available in Taman Tun Dr Ismail, Bangsar, Subang Jaya and Shah Alam in its first phase of deployment. The rest of the Klang Valley is expected to be wired up for the service by the end of this year. At RM149, UniFi’s cheapest plan is equally priced to competitor P1 Wimax’s premium plan, which promises a maximum connection speed of up to 10 mbps. However, P1 said in its website that the average user experience would see connection speeds of between one and three mbps. RM149 is also equivalent to the price charged by Time dotCom (TdC) for its entry-level high speed broadband plan, Time Fibre Broadband. In TdC’s case, it promises a basic connection speed of 2mbps, which can be boosted up to as much as 10 mbps for a limited amount of time. However, TdC’s service is only available in Desa Sri Hartamas and Mont Kiara in the Klang Valley. Kenanga Research delivered a similar verdict, noting that the smaller broadband players would likely suffer from the launch of UniFi. “We suspect that the odds are definitely stacked against the smaller players including P1 Wimax and to some extent the mobile players which are all likely to see further pricing challenges,” Kenanga said in a note yesterday. “While pricing is a concern given the increasingly crowded and competitive landscape, the ability to deliver quality user experience, ie minimal disruptions, will most likely be the mobile players’ largest challenge.” TM is also providing an additional sweetener to the pot, namely the free supply of IPTV and a fixed-line phone. TM is boasting video-on-demand for its IPTV service, which means that subscribers can choose what they want to watch and when, as well as free calls to fixed lines in the country. As for its content, TM has also secured contracts with three of six Hollywood studios to broadcast their content, and is providing two high definition (HD) channels along with its lineup. However, Zamzamzairani said that IPTV was not directly comparable with regular TV broadcasters as its unique proposition was its on-demand functionality. Kenanga Research concurred with TM’s CEO on this point: “The IPTV initiative is unlikely to pose a serious challenge to Astro in the near to medium term, (but) it does however put the latter on their toes especially in terms of service delivery and pricing,” the research house said. This article appeared in The Edge Financial Daily, March 26, 2010.

https://theedgemalaysia.com/node/2554

Market drifts in cautious trading

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KUALA LUMPUR: Market sentiment on the first trading day of May was weak. Bellwether indices in key regional markets were in negative territory throughout the trading day. Interest was also lackluster with markets in Japan and China closed for holidays. Investor confidence was, no doubt, shaken by the recent slew of negative developments. For starters, the Dow Jones Industrial Average ended last week down 1.7%, snapping its record of eight straight weekly gains. News of possible criminal fraud charges against Goldman Sachs for its mortgage trading operations, on top of the earlier civil suit filed by the US Securities and Exchange Commission, gave investors another excuse to take some money off the table. There are fears that the charges will spur more stringent financial reforms, currently under debate by lawmakers. Elsewhere, investors remain skeptical of a resolution to Europe's sovereign debt crisis in the near term. Greece won an expanded aid package from the European Union and the International Monetary Fund over the weekend, now totaling €110 billion (RM466.81 billion) over a three-year period. However, it remains to be seen if the country can sustain the painful austerity conditions attached to the bailout and if it can successfully pare borrowings under a negative gross domestic product growth outlook. Last but not least, sentiment was further hurt after the People's Bank of China raised the reserve requirement ratio for banks by 50 basis points, for the third time this year. Recent measures by the Chinese government to mop up excess liquidity in the system and tamp runaway property prices are a harbinger of tighter monetary policy to come, including interest rate hikes. Trading activities on the Bursa Malaysia was primarily focused on lower liner stocks while interest in blue chips was lackluster. The FBM KLCI closed marginally higher at 1,346.9 points, but market breadth was in the red throughout the trading day. Losing stocks outnumbered gaining ones by roughly nine to five at the close. Some 771 million shares changed hands.Note: This report is brought to you by Asia Analytica Sdn Bhd, a licensed investment adviser. Please exercise your own judgment or seek professional advice for your specific investment needs. We are not responsible for your investment decisions. Our shareholders, directors and employees may have positions in any of the stocks mentioned.

https://theedgemalaysia.com/node/73782

Cloud computing to chart SMR’s growth

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KUALA LUMPUR: At 57 years of age, SMR Technologies Bhd CEO Datuk Dr R Palan may be considered somewhat old by the young techno-preneurs of today. But just as they are, he is well aware of the need to move his business with the times. “I think the workforce is changing. Younger executives are going to be far more comfortable with their iPhones, iPads, Galaxies and BlackBerry’s,” he said. So Palan is revitalising SMR’s business by using  the latest technology to provide its human resource (HR) development solutions to its clients. In September, the ACE Market-listed company acquired a cloud computing company to enhance its enterprise software segment. Previously, SMR’s HR development solutions were provided in one all-encompassing software, which incurs a high capital expenditure. Instead, Palan said, using cloud computing for HR development solutions would become a recurring operating expenditure that will eventually reduce overall expenses. SMR is banking on the technology for SMEs to procure. “We do have larger corporations who are our customers. But I think the medium-sized companies are our ‘sweet spot’ because I think they have a paying point [a smaller budget] and Cloud computing will chart SMR’s future growth,” he said. SMR was established in 1978, as Palan took “a journey of a professional wanting to become an entrepreneur”.  It started with Palan alone as a one-man show and has grown the number of its employees to about 220 now. The IT firm is creating good earnings growth after surviving the global economic crisis of 2008. It posted a net profit of RM5.6 million, or 3.4 sen per share, for the first half of the current financial year ending Dec 31 (FY12), more than half its net profit of RM8.3 million, or 5.5 sen per share, for full-year FY11. The sub-prime mortgage crisis in the US in 2008 was a financial disaster for the company because of an ill-timed venture into the US market. “Unfortunately, the  economy was not strong at the time,” said Palan. “We also learned that the cost of doing business in the US is too high. So we thought, let’s stabilise ourselves in Asean and the Gulf Cooperation Council (GCC) countries first. I think there is so much we can gain from these markets,” he said. The company then dipped into the red. It suffered a loss of RM7.3 million in FY08 and RM2.7 million in FY09. But in 2010, SMR’s wholly-owned subsidiary SMR HR Group Sdn Bhd bagged an RM89.5 million contract from the Ministry of Education. This seems to have been a life saver for SMR. The three-year contract, ending Dec 31, 2013, is for the English language training project. It requires the group to supply 120 trainers to work with English teachers in the Selangor, Perak, Penang, Kedah and Perlis. SMR was one of three vendors awarded this national project. Thanks to the contract, which improved the group’s net profit to RM8.3 million for FY11, from a meagre RM300,000 in the year before. Revenue from the Middle East has continued to rise. In FY11, the company’s revenue from that market was RM1.73 million, more than double RM606,124 in FY10.Palan intends to strengthen the company’s presence in the GCC region. Currently, it has projects in Saudi Arabia and Bahrain. The lifesaving contract has also helped to lift SMR’s share price. The stock has regained lost ground and is back to the pre-2008 crisis level. It hit its year’s high of 32 sen in July  — the highest since August 2007 — rising from a low of eight sen in January 2011. The counter closed at 28.5 sen last Friday, a trailing historical price-earnings ratio of 5.2 times based on last year’s net profit. According to Palan, the company’s gearing ratio has improved to 0.09 times as at June 30, compared with 0.12 times as at end-2011.  However, the company had a relatively large amount of receivables of RM19.6 million as at June 30, up 69% from RM11.6 million six months ago.   This article first appeared in The Edge Financial Daily, on Nov 26, 2012.

https://theedgemalaysia.com/node/35709

#Vegoils* Weak ringgit lifts palm to 2-wk high, but sluggish exports weigh

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KUALA LUMPUR (Jan 20): Malaysian palm oil futures rose to their highest in two weeks on Monday as a weaker ringgit prompted buying interest from overseas investors, but sluggish exports put a lid on gains and kept prices in a tight range. The Malaysian ringgit fell 0.5 percent on Monday, hitting its lowest point in more than four months to trade at 3.3145 against the U.S. dollar. A weaker ringgit boosts margins for overseas buyers and refiners. Weak demand for the tropical oil, however, weighed on prices. Cargo surveyor Intertek Testing Services reported that exports of Malaysian palm oil products in Jan. 1-20 fell 15 percent compared to a month ago as India, the world's biggest palm oil consumer, cut back purchases. Another cargo surveyor, Societe Generale de Surveillance, showed exports fell 15.5 percent to 743,487 tonnes for the same period. "Only a significant reduction in January and February production could stimulate export demand for palm oil, and funds have plenty of shorts to cover after selling crude palm oil futures aggressively since early January," said a trader with a local commodities brokerage in Malaysia. The benchmark April contract on the Bursa Malaysia Derivatives Exchange had risen 1.6 percent to 2,580 ringgit ($779) per tonne by Monday's close. Prices had hit 2,585 ringgit in late trade, their highest since Jan. 7. Total traded volume stood at 38,720 lots of 25 tonnes, slightly higher than the usual 35,000 lots. Technicals showed Malaysian palm oil is expected to test a resistance at 2,564 ringgit per tonne, a break above which will lead to a further gain to 2,588 ringgit, Reuters market analyst Wang Tao said.   Stronger China soy markets helped support palm. Palm typically tracks soyoil as both vegetable oils are commonly used as substitutes for each other. The most active May soybean oil contract on the Dalian Commodities Exchange rose 1.4 percent in late Asian trade. Traders said weak palm prices last week have attracted bargain hunters looking for cheap deals. Prices plunged to a two-month low on Jan. 13 on fears that rising stockpiles in the world's second-largest producer would overwhelm demand. "Futures found a lifeline from bargain hunting, weaker ringgit, and short-covering circa 2,485-2,490 ringgit last week," the trader added.     In other markets, Brent crude edged lower towards $106 per barrel on Monday, weighed down by data which showed China's oil consumption slowed in 2013 and as Iran started implementing a nuclear deal with world powers. U.S. markets are closed on Monday. Palm oil prices in Malaysian ringgit per tonne CBOT soy oil in U.S. cents per pound Dalian soy oil and RBD palm olein in Chinese yuan per tonne Crude in U.S. dollars per barrel ($1=3.31 Malaysian ringgit)

https://theedgemalaysia.com/node/92432

Govt studying one levy for foreign workers in all sectors

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KUALA LUMPUR (July 16): The government is studying on setting only one rate for levy on foreign workers in all sectors to curb their movement from one sector to another. Deputy Home Minister Datuk Dr Wan Junaidi Tuanku Jaafar said the problem was partly due to employers' inability to pay the levy in certain sectors. "The Home Ministry, Human Resources Ministry and the relevant agencies are still looking at imposing one rate for the levy on foreign workers as practised in other countries to reduce their migration from one sector to another." He said this in reply to a question from Datuk Ikmal Hisham Abdul Aziz (BN-Tanah Merah) in the Dewan Rakyat, here, today. Wan Junaidi said 744 foreign workers were detained for misusing their work permit by moving into another sector so far this year. 

https://theedgemalaysia.com/node/73500

Laxey-aligned City of London sells icapital.biz shares

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KUALA LUMPUR: The London-based hedge fund seen aligned to activist investor Laxey Partners Ltd last Wednesday pared down its holdings in icapital.biz Bhd, just three days after Laxey failed in its attempt to gain board representation on icapital.biz. A filing yesterday showed City of London Investment Management Co Ltd sold 155,000 shares in icapital.biz at undisclosed prices, reducing its holdings to 9.14 million shares or 6.53%. City of London had 6.64% of closed-end fund icapital.biz as at Oct 30, ahead of the latter’s controversial AGM on Nov 10. The AGM drew media attention after Tan Teng Boo, who heads Capital Dynamics Asset Management Sdn Bhd that manages icapital.biz, announced he opposed to Laxey’s co-founder Andrew Pegge’s attempt to gain a board seat. While City of London had kept mum on the matter, Pegge told reporters Laxey had been in communication with City of London, which he said was looking for progressive change at icapital.biz. Laxey had 9.65 million shares or 6.89% of icapital.biz as at Oct 31, filings showed. Pegge told reporters he was seeking board representation to get icapital.biz to be more proactive in reducing its stock price’s discount to net asset value (NAV). Pegge also told reporters on Nov 8 he intends to stick around at icapital.biz until the discount is resolved. Tan said the discount is not an issue for investors with a long-term view.Yesterday, icapital.biz closed unchanged at RM2.36, 0.81 times its NAV of RM2.93 per share as at Nov 14. It remains to be seen if Laxey will continue to seek board representation despite the failed attempt. Laxey had made repeated attempts to remove billionaire banker Wee Cho Yaw from the board of Singapore-listed United International Securities (UIS). Wee’s United Overseas Bank owns nearly 50% of UIS. This article first appeared in The Edge Financial Daily, on Nov 21, 2012.

https://theedgemalaysia.com/node/77724

PAS plans to get five states to jointly demand oil royalty from Petronas

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KUALA LUMPUR (Jan 23): From championing solely Kelantan's bid for oil royalty, PAS leader Datuk Husam Musa plans to expand the crusade to all five oil-rich states to leverage on their collective political clout. Mooting a grouping of five resource-rich states, or G5, Husam aims to get them to present a united stand when negotiating on oil royalty issues with the federal government, he told fz.com in a recent interview. The combined electoral weight of the five states – Kelantan, Terengganu, Pahang, Sabah and Sarawak – is enough to make their wishes heeded, Husam argues. The five states have a total 92 parliamentary seats with over 3.5 million voters. "People from these five states must unite if they understand their rights and object to what the federal government practices now," he says. "They can use their standing during the general election. Certainly, 92 seats is a very large force," said Husam, who is Kelantan's state executive council member. That makes up a substantial 41.4% of the 222 seats in Parliament. Of the five states, only Kelantan is currently governed by the Pakatan Rakyat (PR) while the other four states are ruled by the Barisan Nasional (BN). Still, the federal opposition hopes that issues like oil royalty payments can help it gain ground in these states. Husam plans to tour the five states to introduce his G5 concept and to push for higher oil royalty payments of up to 20% of the value of the oil produced in the respective states. It is unclear how much traction Husam and Pakatan can gain with the demand for 20% in oil royalties since the agreements signed with the national oil company Petroliam Nasional Bhd (Petronas) has set payment at 5% of the value of the oil produced in the states. Petronas pays the federal government another 5% for production of the liquid gold. Both Petronas and Minister of Finance II Datuk Seri Ahmad Husni Mohamad have warned that increasing the royalty payments could strain Petronas' economic viability and impede future investments. Scepticism over new territorial lawUsing the G5 platform, Husam plans to warn chief ministers and menteris besar of the potential danger of the Territorial Sea Act 2012 which parliament passed last year. In particular, Section 4 of the Act provides for the sovereignty of the territorial sea, in respect of its bed and subsoil, to be vested in the Yang di-Pertuan Agong. Husam fears that Section 4 can be invoked by the federal government to lay claim to resources under the sea bed, thus undermining the states' claims to oil and gas resources. "I have drafted a letter to all the states so that they are aware that this Act will undermine their state's position. I suggest that they reject the new law. If you want to alter any boundary, you need to go through the state assembly and Council of Rulers. This Act is not applicable until the state assembly approves it," said Husam, who is Salor assemblyman. The new legislation was introduced to specify Malaysia's territorial sea limit of 12 nautical miles after the 1969 Proclamation of Emergency was annulled in December 2011. Previously, the Emergency Ordinance No 7 1969 had set three nautical miles as Malaysia's territorial sea limit. The federal government has hitherto relied on the Emergency Ordinance to strengthen its argument that Kelantan can lay no claim to the petroleum produced off the state's shore as the resource was found beyond three nautical miles. But Kelantan disagrees. "The Emergency Ordinance is purely on the administration of the sea in case of external threats. It has nothing to do with petroleum," Husam said. Fairness between statesApart from securing oil royalty payments for Kelantan, Husam's mission is to ensure that Petronas pays oil royalty directly into the states' coffers so that there is more transparency in the way the funds as spent. There appears to be little uniformity when it comes to oil royalty payments to oil-producing states. Sabah and Sarawak are currently receiving 5% oil royalty from Petronas but both states have made known their wishes for a higher payment. Terengganu meanwhile only obtained oil royalty payments after the state returned to BN rule in 2004. While Terengganu was under PAS administration from 1999 to 2004, the state received its share of the oil spoils in the form of gratuity payments or wang ehsan. Husam has strenuously objected to payments of wang ehsan payments as this is left up to the discretion of the federal government. "There is no such thing as wang ehsan. That's not what is agreed." As for Pahang, prime minister Datuk Seri Najib Razak last year announced that Pahang will be entitled to oil royalty payments from the third quarter of 2014. This was after oil was discovered at Block PM 307 of the Bertam oilfield located some 160km offshore. "Although Pahang has not yet produced anything, the prime minister already promises to pay oil royalties to Pahang. If you can entertain Pahang so well, why can't you do the same for Kelantan?" Husam asks. The federal government has refused to hand the oil royalty payments directly to the Kelantan government. Instead, Kelantan's share of its oil royalty is paid directly to the federal government which then channels it to fund various development and infrastructure projects in the state. Husam argues that this practice was not transparent as it does not require approval from the Kelantan state assembly and is not recorded in the state's consolidated funds. When asked, Husam said he does not know how much has been spent in Kelantan as there have been contradictory numbers reported. At the end of the day, Husam says the tussle over Kelantan's oil money is needlessly complicated. "This is not a complicated issue at all. In fact, it is a very simple issue. Petronas just needs to pay 5% to the state and 5% to federal," Husam said.

https://theedgemalaysia.com/node/30953

Anti-Samy Vellu movement running out of gas?

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KUALA LUMPUR: The Gerakan Anti Samy Vellu (GAS) rally on Sunday, May 30 which was aimed at sending MIC president Datuk Seri S Samy Vellu a strong message that it was time to step down, clearly failed to achieve that effect, measured by the modest size of the gathering. Instead, Samy Vellu has scored another point against the dissidents who want him to call it a day. While GAS chairman, the former MIC deputy youth chief V Mugilan, claimed that the rally was a success, the fact is that most of the 3,000 who turned up were not party members but NGO representatives or former party members who have an axe to grind with Samy Vellu. Earlier, Mugilan had optimistically announced that 15,000 people would attend the rally on Sunday. At first, it was scheduled to be held at the Putra World Trace Centre, but later it was moved to the Mines Convention Centre to defuse the allegation that GAS was Umno-backed. According to a party insider, GAS failed because it could not shake off the perception of a link to Umno. "It is an act by people outside the party who are trying to tell us what to do. Samy Vellu has set his date. We should let him leave on his own terms," he said. The observer said that he was not surprised that many who attended the GAS rally were not MIC members. "Indians as a rule are emotional," said another party member. "MIC members will not take kindly to any attempt to remove their leader, especially if we think that Umno has something to do with it." "Rather than back the dissenters, however right they may be, we would stick with the status quo," said another party member. However, he said that Samy Vellu’s position would be untenable if the deputy president and the vice presidents stand up against him. "Any demand for him to leave earlier must come from the deputy president and vice-presidents. Then there is legitimacy. Sadly, all of them and many more in the central working committee (CWC) and state committees owe their existence to him," he said. The party member said that Samy Vellu would only be in trouble if he did not leave by September next year as announced. An MIC vice-president had said that they are aware of the sentiment against their president but there is a great sense of indebtedness that many feel towards him. He said that they would take the soft approach rather than forcefully ask him to go. To date, deputy president Datuk G Palanivel and vice-presidents Datuk Dr S Subramaniam, Datuk S K Devamany and Datuk M Saravanan have not broken ranks with Samy Vellu. Former secretary-general S Murugesan, who openly criticised Samy Vellu, was promptly given the boot on Sunday. Samy Vellu wasted no time in replacing Murugesan with Negri Sembilan chief Datuk T Rajagopalu. While the succession drama in MIC is being played out, other big issues are waiting to be addressed. While Samy Vellu has outdistanced both his contemporaries and opponents alike, the challenge that remains is whether those who would take over the party helm could bring change to the community. Above all, the question that begs for an answer is whether MIC could swing the once secure Indian votes back to Barisan Nasional before the next general election.