Friday, 31 May 2013

IGB: Business picking up after quiet first qtr

IGB Corp, which owns the retail space in Mid Valley City, has started to see business beginning to pick up since the second quarter after a rather quiet first quarter, MD Robert Tan said. He said May and June will be the peak season for shoppers and the company will continue with its various marketing campaigns to boost tenants' revenues. He said some RM5m will be spent this year to upgrade some parts of the mall to improve the quality of visitors' shopping experience. (BT)

Source: CIMB Daybreak - 31 May 2013

Challenging target for IGB REIT

IGB REIT Management is targeting double-digit rise in rental rates for half of its net lettable area in the Gardens mall that is due for renewal this year. Currently, average rental rates at The Gardens and Mid Valley Megamall are RM9-10 per sq ft and RM11-12 per sq ft respectively. The group invests about RM5m every year to upgrade both malls. (SunBiz)

Source: CIMB Daybreak - 31 May 2013

Petronas job a catalyst for Petra Energy's growth

Integrated oil and gas services provider Petra Energy Bhd expects its newly-secured hook-up commissioning (HUC) and topside major maintenance services contract to contribute between 20 and 25% to its total revenue by 2015. Executive director and chief executive officer Datuk Anthony Bujang said the five-year contract, awarded on May 21 by Petronas Carigali Sdn Bhd, is the biggest contract secured by the group thus far. "The project will commence in a few weeks and if everything goes on schedule, we will see turnover to flow in by 2015. (BT)

Source: CIMB Daybreak - 31 May 2013

Mitsui buys 19.99% stake in IIB unit

Mitsui & Co Ltd of Japan has emerged as a substantial shareholder in Medini Iskandar Malaysia Sdn Bhd - a company controlled by Iskandar Investments Bhd (IIB) which in turn is owned by Khazanah Nasional, Kumpulan Prasarana Rakyat Johor and the EPF - after acquiring a 19.99% stake from IIB and United World Infrastructure, which is based in the US. (Sunbiz)

Source: CIMB Daybreak - 31 May 2013

Patimas makes police report after audit

Patimas Computers Bhd had lodged a police report based on the findings of an investigative audit report by UHY Advisory (KL) Sdn Bhd. UHY Advisory revealed several irregularities in Patimas' software development costs from the audit. The audit firm added that there was a conflict of interest in software development transactions and sales and purchase transactions. It stated several companies had connections with a Patimas director and there was no declaration on the persons involved in the transactions. UHY also said "it appears that Patimas Group's revenue had been inflated through fictitious entries for sales that never occurred or improperly realised in an inappropriate period." (Financial Daily)

Source: CIMB Daybreak - 31 May 2013

Perodua optimistic of achieving sales target

Perusahaan Otomobil Kedua Sdn Bhd (Perodua) is cautiously optimistic of achieving this year‟s target to sell 194,000 cars, up 3% from last year's 189,000 cars, if the current momentum continues and no major challenges surface. President and CEO Datuk Aminar Rashid Salleh said Perodua‟s sales for the first four months of this year rose 9% to 64,400 from the same period last year. “We don‟t know what‟s going to happen over the next few months, but we are cautiously optimistic of being able to meet the sales target of 194,000 cars, barring any unforeseen circumstances,” he said. Aminar said despite the sluggish market sentiments in the last two months, as buyers adopted a “wait-and-see” attitude awaiting the outcome from the yet-to-be-announced National Automotive Policy and the car price reduction plan by the Government, the company managed to record a high sales growth of 24.6%. He said the company would also continue to explore opportunities to increase local components in its cars to reduce costs. (StarBiz)

Source: CIMB Daybreak - 31 May 2013

Malaysia's Scomi among only 2 firms left in bid for RM4.65bil Chennai monorail job

Only two companies - 1) India's ILFS Transportation Network-Scomi Engineering Consortium, and 2) Gammon India - are left in the running for the RM4.7bn, 57.1km monorail project in Chennai. This is India's largest monorail network. If secured, this will be Scomi's biggest monorail project. "The tender is expected to be awarded before end-Aug 13." COO of Transport Solutions Kanesan Veluppillai said. (Malaysian Reserve)

Source: CIMB Daybreak - 31 May 2013

Malindo to receive 5 Dreamliner from PT Lion in 2015

Malaysia's first hybrid airline, Malindo Air, will receive five Boeing 787-8 Dreamliner from its parent, Indonesia's PT Lion Group, in 2015. Malindo chief executive officer Chandran Ramamuthy said the airline will deploy the aircraft on six-hour routes, such as to the Middle East, North India, North Asia and Australia, from Kuala Lumpur International Airport (KLIA). He also said the airline is considering flying the B787 Dreamliner to North China from Kota Kinabalu International Airport. (BT)

Source: CIMB Daybreak - 31 May 2013

Westports set US$500m IPO, Oct listing

Westports Malaysia, the operator of the country's busiest port, would list on Bursa Malaysia in October in a deal that may raise up to RM1.54bn (US$500m). Westports, which counts Hutchison Port Holdings and Khazanah Nasional as shareholders, is expected to obtain regulatory approval for the listing in two months' time. (Reuters)

Source: CIMB Daybreak - 31 May 2013

SapuraKencana expected to be included in KLCI

SapuraKencana Petroleum Bhd, Malaysia's biggest oil and gas services company, has emerged as the odds-on-favourite to be included in the FTSE Bursa Malaysia KLCI (FBM KLCI) index. SapuraKencana has a market capitalisation of more than RM24bn, making it the 15th largest public-listed company in Malaysia. (Btimes)

KUB says not cause of delay

KUB, tasked with building the runway and taxiways for KLIA2, said it was not one of the contractors that had caused the delay. "The runways and taxiways are 85% completed and we are on track to deliver our packages on time." CEO Datuk Wan Mohd Nor Wan Ahmad said. KUB's runway and taxiway job is worth RM260m. He refuted earlier reports that the delays were caused by soil settlement issues due to the relocation of the airport to peat swamp land. Separately, WCT and Gadang, managed to deliver their packages on time for the project. (Financial Daily)

ERL extension line to KLIA2 almost ready

The 2.2km extension line and services from KLIA to KLIA2 is almost ready, according to Express Rail Link Sdn Bhd (ERL). CEO Noormah Mohd Noor said the project is 95% completed. She said the company had already tested the train service. The ERL station at KLIA2 will be located within the terminal's integrated complex. (Malaysian Reserve)

Astro's NJOI to see positive viewer growth this year

Astro Malaysia Holdings Bhd's subscription-free satellite TV service NJOI is expected to see positive viewership growth this year following the launch of additional channels. Astro said the service has attracted 209,000 customers since its commercial launch and the company expects customers to continue growing. Astro previously offered NJOI customers prepaid packs offering several channels packaged together. However, the company is now offering individual channels to NJOI customers at cost of RM2-15 for two days to one month. (Star Biz)

Telekom expects more UniFi and Streamyx subscribers

Telekom Malaysia remains bullish over its prospects this year as it expects a higher take-up of its UniFi and Streamyx high speed broadband services.

  • Group CEO Datuk Seri Zamzamzairani Mohd Isa said "Overall, we continue to show good progress on our business transformation efforts amid heightened competitive environment. 
  • "We recorded a healthy growth, particularly in the Internet and data services, with UniFi being the key driver, growing 68.4% to more than 532,000 customers in the first quarter from a year ago," Zamzamzairani said. 
  • "Prospects for the current financial year ending December 2013 remains positive on the back of more than 560,000 UniFi customers to date." 
  • "We foresee higher take-up of broadband services with the introduction of Streamyx 8Mbps and the future expansion of UniFi based on demand." 
  • "We expect to attract more HyppTV viewers. We are also pleased to highlight that HyppTV had recently won the 'Best Live Online TV Service 2013' award at the TV Connect Industry Awards in Mayfair, London," it added. (BT)

CIMB Political News - 31 May 2013

The Umno supreme council meeting tomorrow will likely kick off the party's election process. Umno is expected to elect its top leaders and those from its Wanita, Youth and Puteri movements, besides office bearers at branch and division levels.

  • The difference this time around will be the involvement of 146,500 members, who will elect the party president, deputy president, vice-presidents and members of the supreme council. This is a departure from previous general assemblies where only 2,500 delegates were allowed to cast their ballots. 
  • Insiders said the 146,500 members might cast their votes simultaneously at all 191 divisions nationwide as early as Oct 31, and the results would be announced during the general assembly, which might be held in the middle or end of Nov. (NST)

Former Selangor menteri besar Dr Mohamad Khir Toyo failed in his bid to overturn his conviction and a 12-month jail sentence for acquiring two plots of land to build a bungalow without adequate consideration. Court of Appeal judge Datuk Azahar Mohamad dismissed Dr Dr Khir's appeal but granted him a stay on the sentence and forfeiture of property pending an appeal to the Federal Court. (NST)

Subang Jaya assemblyman Hannah Yeoh, who has been named as Selangor state Speaker, will become the youngest and first woman Speaker of any legislative assembly in the country. At 34, Yeoh will also be the youngest to chair any of the legislative assemblies in the country. (Star)

Any open debate on Datuk Seri Najib Razak’s future as Umno president and prime minister will be driven by Tun Dr Mahathir Mohamad and Tun Daim Zainuddin, veteran journalist Datuk Abdul Kadir Jasin said. Abdul Kadir said that the two veteran Umno leaders had even met and drawn up an action plan following the 13th general election. “Daim met Dr Mahathir in Putrajaya few days after the May 5 general election where they were said to have made a "review‟ of the results and the short-term and medium-term measures that they will take,” Abdul Kadir said. (Malaysia Insider)

CIMB Malaysian Economic News - 31 May 2013

Malaysia will strive to achieve fiscal balance for economic sustainability to ensure that competitiveness is further enhanced, said International Trade and Industry Minister Datuk Seri Mustapa Mohamed. This would be achieved through, among others, further reducing the budget deficit and intensifying regulatory review initiatives to modernise the business environment, he said.

  • Despite declining two positions in Government Efficiency factor in the IMD World Competitiveness Yearbook (WCY) 2013, Malaysia is well placed among the top 15 countries, registering improvements in Fiscal Policy and Public Finance. 
  • It is indeed encouraging that Malaysia had improved in three of these factors; Economic Performance (7th), Business Efficiency (4th) and Infrastructure (25th), he added. (Bernama)

The local building materials industry is expected to record higher sales worth RM30bn this year in tandem with the vibrant construction sector, said Credit Bureau Malaysia (CBM) COO Eric Chin. Based on statistics, the construction industry is projected to grow at about 12-13% this year, against 18.5% in 2012, driven by the entry point projects (EPP) and Economic Transformation Programme (ETP), and that's looking at about RM110bn in terms of the overall construction industry, he said. (Bernama)

The government will not implement the goods and services tax (GST) in the near term as it is still studying its implications and rate to be imposed. Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah said the government is still engaging with politicians, the private sector and the general public before arriving at a decision.

  • "We are relooking our earlier study by taking a holistic view of it. We do not want to just see the GST from the point of government revenue but also the prosperity of the people," he said.
  • Besides generating revenue, the implementation of the GST, is also in tandem with the government's intention to reduce corporate and personal tax, he said.
  • He also said the government had set no timeline for the implementation of the GST. (Bernama)

Among Southeast Asia‟s main oil and gas producers, Malaysia was ranked 34th in the latest global index that measures the quality of governance in oil, gas and mining sectors of 58 countries, tailing neighbours Indonesia, the Philippines and even poverty-plagued Timor-Leste. According to the 2013 Resource Governance Index (RGI), Malaysia‟s performance was judged as “weak” by the New York-based Revenue Watch Institute (RWI).

  • Malaysia scored 46 composite pts out of 100, on par with west African countries such as Gabon, Guinea and Sierra Leone and just ahead of China, which scored 43 points and ranked 36th out of the 58 countries.
  • The world‟s top performers were Norway which bagged the top spot with its composite score of 98 pts, followed by the US (92 pts), the UK (88 pts) while Myanmar bottomed out with 4 pts.
  • Timor-Leste which scored 68 pts was the highest-ranking Southeast Asian nation, beating Indonesia (66 pts) by one step to take the 13th spot. The Philippines came in at No. 23, followed by Vietnam (43) and Cambodia (52). (Malaysian Insider)

The government will consider importing produce to control the price of food items and protect the interests of consumers. Domestic Trade and Consumer Affairs Minister Datuk Hassan Malek said the step might be considered to curb price hikes and excessive profiteering by unscrupulous traders. However, he said the move would only be made as a last resort if the situation worsened and needed a tougher approach by the government. (NST)

The Customs Department collected more than RM32bn in taxes last year, the highest amount recorded in the last five years. Deputy Finance Minister Datuk Ahmad Maslan said the department's good performance last year was an incentive for it to meet its target this year, which is RM34bn, a 6% increase from last year's total.

  • The main sources of collection were from local excise duty, service tax, local sales tax, import sale tax, import excise duty, import duty and export duty. Import duty on vehicles was also a main income source.
  • He said reaching the target was possible as this year's collection for the first quarter stood at RM13.6bn, up 4% from 1Q12. (NST)

The Inland Revenue Board (IRB) is well on track to collect RM130bn in taxes this year, said its CEO Tan Sri Dr Mohd Shukor Mahfar. Last year, IRB collected RM124.99bn in taxes, up from RM109.61bn in 2011 and RM86.49bn in 2010.

  • “Looking at the data we have now, we are well on our way to reaching this year‟s target of RM130bn as we ride on the back of Malaysia‟s growth and political stability,” said Shukor.
  • He said a record 2.3m Malaysians filed their tax documents via e-filing this year, 15% higher than last year. (BT)

Malaysia posted an impressive overall tourism growth in 2012, capping off a string of tourism accolades that placed the nation in the global limelight. It managed to attract US$308m in tourist receipts last year from tourists visiting the country for major sports, art, lifestyle and entertainment events.

  • Under the Economic Transformation Programme, Malaysia has targeted to achieve 36m tourist arrivals and US$60bn in tourism receipts by 2020. One of it is by securing major events.
  • In line with the focus to secure more major events for Malaysia, Malaysia Major Events is the new brand created under the Ministry of Tourism and Culture, to be on par with global events bureaus. (Bernama)

The government is currently awaiting the proposal from the Land Public Transport Commission (SPAD) for the second Mass Rapid Transit (MRT) line. MRT Corp CEO Datuk Azhar Abdul Hamid said once the proposal is received and approved, the government will announce it at an appropriate time taking into consideration the country's financial and technical capabilities. (Bernama)

CIMB Global Economic News - 31 May 2013

US jobless claims rose 10,000 to 354,000 in the 25 May week (a revised 344,000 in the earlier week), higher than consensus of 340,000. (Bloomberg) 

US corporate after-tax profits rose 4.0% yoy in 1Q13 from 13.3% in 4Q12. (Bloomberg) 

US pending home sales rose 0.3% mom in Apr to 106.0 (a revised 1.5% to 105.7 in Mar), underperforming consensus of 1.4%. (Bloomberg) 

US GDP grew at a seasonally adjusted annualised rate (SAAR) of 2.4% qoq in 1Q13, less than the 2.5% initially estimated (0.4% in 4Q12). Economists expected 2.5%. The GDP price index rose 1.1% qoq SAAR from 1.2% initially estimated. This underperforms consensus of 1.2%. (Bloomberg) 

Eurozone economic confidence rose to 89.4 in May from 88.6 in Apr, in line with consensus. Manufacturer confidence increased to -13 from -13.8 in Apr, whilst services confidence climbed to -9.3 from -11.1. Consumer confidence improved to -21.9 from -22.3. (Bloomberg) 

The European Commission laid down its economic targets for EU nations desperately seeking growth and jobs in the fallout from the debt crisis but gave France and Spain extra time in return for deeper reforms. Given an additional two years to put its fiscal house in order, such pension and labour market reforms must get France to an expected budget deficit of 2.8% of GDP in 2015, it said. Spain, which narrowly avoided a full-scale debt bailout last year, was given two extra years to bring its budget deficit into line at 2.8% of GDP by 2016. (AFP) 

Optimism about profitability among European companies in China has fallen to an all-time low, a survey by the European Union Chamber of Commerce in China showed, with only 29% saying the outlook was positive, down from 34% last year. (AFP) 

South Korea’s industrial output was up 1.7% yoy in Apr from a year earlier, from a revised 2.9% contraction in Mar. The Apr reading beat a poll of economists that forecast a 0.4% fall. (WSJ) 

The Philippines’ GDP rose 7.8% yoy in the three months through Mar, compared with a revised 7.1% gain in the previous quarter. The figure beat all economist estimates, whose median was 6%. (Bloomberg) 

The State Bank of Viet Nam (SBV) announced that it would delay the application of a circular classifying and making provisions for bad debts by one year, until Jun 2014. The delay is intended to help enterprises access credit, boost lending and reduce lending interest rates in the current context of economic hardship. (Vietnam News)

Thailand’s Ministry of Commerce yesterday corrected its Apr trade balance and export figures originally released on 23 May. Exports rose 2.89% yoy in Apr (4.55% in Mar), whilst imports gained 8.91% yoy (-11.52% in Mar), bringing the trade deficit to US$4.141bn (-US$0.867bn in Mar). (Bloomberg)

CIMB Daybreak - 31 May 2013

What's on the Table...

  • Telekom Malaysia - A muted tone
  • Sunway Bhd - All fired up in 1Q
  • DRB-Hicom - Turnaround of automotive division brings hope
  • Media Chinese Int'l - Warning signs for print
  • Supermax Corp - Making a comeback

News of the Day...

  • Government will not implement GST in the near term
  • Telekom expects more UniFi and Streamyx subscribers
  • Westports set US$500m IPO, Oct listing
  • SapuraKencana expected to be included in KLCI
  • Astro's NJOI to see positive viewer growth this year
  • Malindo to receive 5 Dreamliner from PT Lion in 2015
  • ERL extension line to KLIA2 almost ready

Click here for the full PDF report 

Thursday, 30 May 2013

PJI unit wins MRT job

PJI Holdings Bhd's wholly owned subsidiary, PJ Indah Sdn Bhd, has accepted a letter of acceptance from Mass Rapid Transit Corp Sdn Bhd for Projek Mass Rapid Transit Lembah Kelang Jajaran Sungai Buloh-Kajang Package FD1, worth RM32m. The company said the Package FD1 involved the supply, procurement, installation, testing and commissioning of the fire detection and protection systems for elevated packages V1 and V2 and the Sungai Buloh depot. “The estimated practical completion date of the contract is by Dec-2014,” it stated. (Starbiz)

Source: CIMB Daybreak - 30 May 2013

Digistar secures RM250mil construction job, its first

Digistar Corp, which is venturing into the property and construction sector, has secured its first construction job for a RM250m private financing initiative (PFI) for a Government training centre in Malacca, said sources. In the tripartite joint venture, Digistar, which has a 40% stake, is partnering a government-linked entity, which holds a 30% stake, and another private construction company, which holds 40%.
  • Funding for the PFI, which is situated on a 40.47ha site in Malacca, has been secured. Construction work is supposed to commence before year-end and will be completed by early 2016. Thereafter, Digistar will operate and maintain the facility for the next 12 years, thus providing recurring income for the group. 
  • The source said that margins for the construction project were expected to be lucrative, and would be in the double-digit region. He added that earnings contribution would start being recognised by next year and, moving forward, property and construction could be the biggest contributor to Digistar. 
  • Digistar's ICT order book currently stands at around RM35m. It is bidding for RM200m worth of ICT jobs. The group has aspirations to expand into the broadcasting and interactive pay-TV segments. (Starbiz)

Source: CIMB Daybreak - 30 May 2013

Tropicana Corp sets private placement at RM1.78 per share

Tropicana Corp Bhd or formerly known as Dijaya Corp, has set the share price of its private placement at RM1.78 per share. The price represents a 9.88% discount to the five-day volume weighted average market price of Tropicana shares up to May 28, which stood at RM1.975.

It said the placement was oversubscribed by 2.6x during the book-building process. It has entered into a placing agreement with with CIMB Investment Bank Berhad and Standard Chartered Securities (Singapore) Pte. Limited as the joint global coordinators for the corporate exercise. (Starbiz)

Source: CIMB Daybreak - 30 May 2013

Dutch Lady set to increase prices by 5%

Dutch Lady Milk Industries Bhd (Dutch Lady Malaysia) will increase the price of some of its key products by 5% this year due to rising raw material prices. The company expects a 25-30% hike in dairy raw material prices this year. "In the recent past, we have seen significant increase in some key dairy raw material prices, driven largely by drought in New Zealand (and), we estimate an increase of 25-30% in key material prices this year compared with 2012.

"We are trying to minimise the price increase that will be passed on to consumers by buying dairy raw materials at the right price and the right time," said its managing director Rahul Colaco after the group's post-annual general meeting (AGM) press conference. (BT)

Source: CIMB Daybreak - 30 May 2013

Malaysia Airports takes KLIA2 contractors to task for delay in completion

The delays plaguing the completion of KLIA2 is the result of the non-delivery of parts of the project by contractors, leading Malaysia Airports Holdings Bhd (MAHB) to come out to say that it would impose liquidated and ascertained damages (LAD) on the responsible parties. While MAHB did not reveal the amount of the LAD being sought, sources told Starbiz that it amounted to some RM4m-RM6m for every month of delay. KLIA2's first targeted date of completion was Sep-2011, but it isn't clear what period of time the LADs are being claimed for. Sources also told StarBiz that the UEM Group was one of the contractors affected.

Sources said that while the airport was about 92% complete, the terminal building had not been fully completed by the contractor a UEM-Bina Puri joint venture. “Some of the works cannot be finished because the terminal is not completed, and some works would coincide with the completion of the terminal,” said a source. MAHB said its board had met yesterday and had decided to impose the LAD on the respective contractors and pursue any other recourse available to it under the contract. (Starbiz)

Source: CIMB Daybreak - 30 May 2013

Revving up Malaysia's automotive sector

The revised National Automotive Policy (NAP) will boost the local automotive industry by drawing more investments into the country, industry executives said. Malaysia Automotive Institute (MAI) CEO Madani Sahari said more foreign players are expected to invest in the local industry as it becomes more liberalised.

The government is positioning Malaysia as the regional energy efficient vehicles (EEV) hub via the revised NAP. “The policy will open up and liberalise our automotive industry. It will allow the industry to expand and bring in new investments,” Madani said. He was speaking at the second series of the Business Times Insight focusing on the NAP, here, yesterday. (BT)

Source: CIMB Daybreak - 30 May 2013

Hap Seng plans up to RM500m capex

Hap Seng Consolidated Bhd plans to allocate up to RM500m capital expenditure (capex) this year. Hap Seng managing director Datuk Edward Lee Ming Foo said it will invest between RM400m and RM500m to expand its four core businesses for the year ending December 31 2013. "The capital will be channelled towards our core businesses namely plantations, property holding and development, automotive as well as quarry and building materials," Lee said.

A big portion of the capex will be used to finance Hap Seng's property development, expand its Mercedes-Benz dealership network in the Klang Valley, buy new quarry business and improve infrastructure and plant facilities at its plantations. Property is the most profitable business for Hap Seng. The group did not rule out the prospect of demerging its property division into a new listed entity. "It's always an option. Now we are concentrating on building our land- bank and gearing up development. (BT)

Source: CIMB Daybreak - 30 May 2013

Moratorium 'won't harm palm oil industry'

The palm oil industry should not be worried about the Indonesian government’s decision to extend the moratorium on the conversion of primary forest and peatland, as the measure will unlikely affect forests allocated for commercial purposes, an official says. Director General of Forestry Planning at the Forestry Ministry, Bambang Soepijanto, said in Jakarta that the decision would not harm the palm oil industry as about 5.7m hectares of forest areas designated for oil palm, rubber and sugar cane plantations had not been used.

In addition, oil palm plantations could use part of about 17m hectares of forest which had been designated as convertible production forest (HPK), he said. According to data from the Agriculture Ministry, Indonesia currently has a total of 9m hectares of oil palm plantation nationwide, less than the total HPK designated for commercial use. (The Jakarta Post)

Source: CIMB Daybreak - 30 May 2013

New platform streamlines M2M for Malaysia's DiGi

DiGi will soon implement the Ericsson device connection platform to provide customers with everything they need to deploy, manage and monetise millions of machine-to-machine (M2M) and consumer-electronics devices. The Ericsson device connection platform will allow DiGi to increase revenue and cut both operational costs and time-to-market, said Digi and Ericsson in a joint statement today. DiGi Head of M2M Akash Das said the company provided M2M services to a variety of customers who would now be gradually migrated to the Ericsson device connection platform. (Bernama)

Source: CIMB Daybreak - 30 May 2013

REDtone sells unit stake to Sultan of Johor

Redtone has entered into an agreement to divest its 21%stake in Redtone Network (RN) to Sultan Ibrahim Ismail of Johor for RM315,000 in cash. Upon completion of the divestment, Sultan Ibrahim will hold 51% and Redtone 49% of RN.
  • It added that RN is one of the three shortlisted contenders for the digital terrestrial TV broadcast (DTTB) tender, which is expected to submit a detailed business plan on June 3 in round two of the tender process. 
  • The DTTB bid is for the building, operating and managing of the sole digital terrestrial television infrastructure in Malaysia. The first rollout of DTTB services to the public is expected to be in 2014, with full nationwide coverage targeted for end-2015. 
  • The company has named Huawei, a leading global information and communications technology (ICT) solutions provider, as its technology partner and system integrator while Media Broadcast GmbH is responsible for designing the network and complete operational requirements for the DTTB project. (Bernama, Financial Daily)

Source: CIMB Daybreak - 30 May 2013

RM85m for Celcom network expansion in Sabah

Celcom Axiata will spend over RM85m for network expansion and upgrades in Sabah and Sarawak over the next 12 to 18 months, said CEO Datuk Seri Shazalli Ramly. Celcom aims to have an additional 134 3G and 150 LTE sites by mid-14. (Bernama)

Source: CIMB Daybreak - 30 May 2013

Dennelind will not assume CEO role: Maxis

CEO-in-waiting Johan Dennelind will not be joining Maxis "owing to recent personal family circumstances which have made it necessary for him to reside closer to family in Sweden." "Johan has indicated he is unable to assume the role of CEO."
  • The Board will continue with its search for a CEO. It is intended that this candidate will be capable of further strengthening the Company’s management team and of mentoring and grooming a suitable successor. 
  • Consequent to this, Maxis announced that CFO Nasution Mohammed has been appointed Joint COO with effect from 1 June 2013 and together with the current Joint COO, Suren J. Amarasekera will provide overall leadership to the company and be responsible for its performance. They will report to the Chairman. Nasution will continue to oversee the Finance function. 
  • Current Joint COO Mark Dioguardi, whose employment contract expires on 30 June 2013 will relinquish his position on 31 May 2013. (Maxis, Financial Daily)

Source: CIMB Daybreak - 30 May 2013

EPF will let RHB Capital and MBSB decide on merger plans

The Employees Provident Fund (EPF) will let RHB Capital Bhd (RHBCap) and Malaysia Building Society Bhd (MBSB) decide on merger plans. The EPF holds a 44.84% stake in RHBCap and 65.5% in MBSB, a non-bank lender to civil servants. “We will wait for the two companies to decide what they want to do, and there will be a few announcements to be made,” EPF CEO Datuk Shahril Ridza Ridzuan told a media briefing.

“The fact that the EPF is a big shareholder in RHBCap and MBSB tends to let people draw an assumption that we are going to do something about the two, but this is not necessarily the case,” he said. (Starbiz).

Source: CIMB Daybreak - 30 May 2013

Petra Energy awarded HUC job by Petronas Carigali

Petra Energy has secured a contract from Petronas Carigali for the provision of hook up, commissioning and topside major maintenance services for five years effective 21 May. (BMSB)

Source: CIMB Daybreak - 30 May 2013

Mah Sing Group will be developing the RM1.4bn Kota Kinabalu Convention City

Mah Sing Group will be developing Kota Kinabalu Convention City in Sabah with an estimated GDV of RM1.4bn. Mah Sing said its 51% subsidiary had acquired 9.33 acres of land for the project. The total investment for the land at RM184.9m is equivalent to about 13.2% of the estimated GDV and will be paid over a minimum of 42 months. The development was expected to commence in 2014 and completed within five years.
  • Mah Sing is also entitled to exercise an option for 5.95 acres of adjacent land which may generate additional GDV of RM600m. "We may exercise the option for an entitlement price of RM117m within two years from the issuance of the separate issue document of title," Tan Sri Leong Hoy Kum said. (Starbiz)

    This announcement does not come as a surprise as the group has stated its intentions of acquiring additional landbank in Klang Valley, Iskandar, Penang and Sabah. Nonetheless, we view the acquisition positively as it expands the group's reach in Sabah and the land in Kota Kinabalu is very prime and the project is being positioned as the KLCC of Sabah. This purchase is the third landbank acquisition in two days and brings the total number of acquisitions this year to four with GDV potential of RM7.7bn.

    Source: CIMB Daybreak - 30 May 2013

    CIMB Political News - 30 May 2013

    Parti Keadiland Rakyat VP Tian Chua and four others were yesterday charged in the sessions court with making seditious remarks at a public forum two weeks ago. Tian Chua together with Malaysian Undergraduates Solidarity chairman Muhammad Safwan Anang Talib, former DPM Tun Ghafar Baba's son Mohd Tamrin Abdul Ghafar, and opposition activist Haris Fathillah Mohamed Ibrahim all claimed trial when the charge was read. An hour later, political activist Hishammuddin Rais, who turned himself in on learning that a warrant of arrest had been issued for him, was charged with a similar offence in the same court. They were accused of uttering seditious words to incite the people to change the government which had been formed in accordance with the law. (Sun)

    Source: CIMB Daybreak - 30 May 2013

    CIMB Malaysian Economic News - 30 May 2013

    All food premises must register with the Health Ministry before 1 Jan 2014 to avoid legal action. In a statement Wednesday, the ministry said the food premises included food factories, catering outlets, restaurants, and fixed and mobile stalls. The registration requirement is in line with the Food Hygiene Regulations 2009 which was gazetted on 28 Feb 2009. (Bernama)

    Malaysia remains in the top 15 most competitive nations in the latest global ranking. It slipped one notch to 15, according to the IMD World Competitiveness Centre under the top-ranked global business school IMD in Lausanne, Switzerland.

    • In the data released early today, Malaysia remains in the top league that also includes three other Asian economies - Hong Kong (3rd), Singapore (5th) and Taiwan (11th) - from out of 60 economies. 
    • The US regained its top spot this year due to its strengthening financial sector, technological innovation and host of successful companies.
    • China and Japan are 21st and 24th respectively, with the latter's economy given a shot in the arm through the policies of its Prime Minister Shinzo Abe. (BT)

    Malaysia has the potential to become among the top 10 most competitive nations in the world, said the IMD World Competitiveness Centre. Its director Professor Stephane Garelli said it is a question of stepping up on the current efforts.

    • “I believe Malaysia can achieve that as it enjoys advantages such as location and land availability as well as a skilled workforce and a huge advantage in the capabilities of its manufacturing sector,” he said. 
    • Having a business friendly policy is not as important as attracting investments to Malaysia, he said. 
    • “Malaysia must endeavour to move up the value chain as quickly as it can but high wages must be supported by high productivity, too,” Garelli cautioned. (BT)

    Malaysia has suspended the import of 11 starch-based products from Taiwan after Singapore authorities found maleic acid in some tapioca pearls or balls used in the popular "bubble tea" drink. Home Ministry food safety and quality senior director Noraini Datuk Mohd Othman said the suspension was a precautionary measure after they received early media reports on the issue.

    • The tapioca ball importer in the list of 11 included Sunright Foods and Grand Chainly Enterprises Co Ltd. 
    • Tapioca pearls suspended from being imported are from Possmei International Co. Ltd, Shang Wang, Ting Long, An Li Si and Taiwan Tapioca Foods Company Ltd. 
    • Tapioca starch importer Hong Kai Foods Co and noodles importers Sin Chi Zhi Miang Chang are also on the suspension list. (The Star)

    CIMB Global Economic News - 30 May 2013

    The US MBA purchase applications index rose 3.0% wow in the 24 May week (-3.0% in the earlier week), whilst the refinance index dropped 12.0% wow (-12.0% in the prior week). (Bloomberg) 

    The European Union is urging the US to allow time for international talks before it imposes swaps rules on EU lenders, saying that the current timetable would lead to “huge legal and operational uncertainty.” (Bloomberg) 

    Eurozone M3 money supply rose 3.2% yoy in Apr (2.6% in Mar), above expectations for a 2.9% increase. (Reuters) 

    Japan’s retail sales fell 0.1% yoy in Apr (-0.3% in Mar), less than consensus of -0.4%. (RTT News) 

    The Bank of Thailand cut its main policy rate by a quarter of a percentage point and said it is ready to implement capital controls if necessary to contain the strength of Thailand's currency. (WSJ) 

    A quarterly survey of residential and commercial land prices in Japan showed higher prices in 80 of the 150 areas covered in 1Q13, compared with 51 in the previous survey. Prices were flat in 51 of the areas, compared with 74, and down in 19. (WSJ) 

    IMF lowered its growth forecast for the Chinese economy this year to 7.75% from an earlier forecast of 8%, due to sluggishness in the global economy, which hurts demand for China's exports. (WSJ) 

    Indonesia’s government will introduce next year a package of tax incentives to encourage innovation and reduce dependence on imports. Starting next year, tax-reduction schemes will be given to strategic industries producing intermediate goods. (Jakarta Post)

    CIMB Daybreak - 30 May 2013

    What’s on the Table...
    • Oriental Holdings - No more deep value
    • Media Chinese Int'l - Time to read something else
    • Malaysian Bulk Carriers - POSH stealing the limelight
    • Ann Joo Resources - Steel a dumping issue
    • Carlsberg Brewery (M) - Festive cheer
    • Felda Global Ventures - Lower price is the root cause
    • Genting Plantations - Weaker prices dampen 1Q
    • Hap Seng Plantations - Supported by attractive EV/ha
    • Puncak Niaga Holdings - No flow on the takeover side
    • RHB Capital Bhd - Dented by provisioning
    • Wah Seong Corp - All (s)hook up over Petra Energy
    • Alpha Edge - No danger signs yet

    News of the Day...
    • Mah Sing Group will be developing the RM1.4bn Kota Kinabalu Convention City
    • EPF will let RHB Capital and MBSB decide on merger plans
    • Petra Energy has secured a contract from Petronas Carigali
    • Tropicana Corp set the share price of its private placement at RM1.78 per share
    • Hap Seng Consolidated plans to allocate up to RM500m capex this year
    • Eurozone M3 money supply rose 3.2% yoy in Apr (2.6% in Mar)

    Click here for the full PDF report 

    Wednesday, 29 May 2013

    U Mobile partners Enabling Asia, targets 5 million subscribers

    U Mobile is teaming up with Enabling Asia Tech Sdn Bhd to grow its customer base to five million. Enabling Asia, otherwise known as a Mobile Virtual Network Aggregator (MVNA), provides integrated solutions from licensing and billing to technical solutions and call centre support to facilitate seamless market penetration, and at a lower cost too.

    “Brands with their own mobile services would be able to generate sustainable and additional revenues by connecting directly with their customers,” Enabling Asia CEO Loke Yee Siong told the press. Under the agreement, U Mobile will provide the exclusive network connectivity, while Enabling Asia will handle the operations. (Starbiz)

    Source: CIMB Daybreak - 29 May 2013

    Luxchem Corp eyes 10pc revenue increase in 2013

    Industrial chemical supplier Luxchem Corporation Bhd is eyeing a 10% revenue growth for 2013. The company recorded RM496.9m last year. Its managing director and chief executive officer Tang Ying See said the company will continue to expand its range of products this year. He added that since establishing a subsidiary in Indonesia in 2011, the company had been expanding its customer base in the country. (BT)

    Source: CIMB Daybreak - 29 May 2013

    Gabungan AQRS to launch more projects in Iskandar

    Gabungan AQRS will launch more property projects in Iskandar Malaysia this year. CEO Ng Chun Kooi said the company will focus on Iskandar Malaysia as it positions itself to capturing potentials in the property sector. The company had recently launched its first high-rise residential development called "The Peak" in JB.

    It will soon be launching its commercial development in Permas Jaya, Johor. The combined gross development value of the projects is about RM654m. "Our construction division will be keeping a keen eye on tendering and securing new infrastructure projects, as well as achieving new milestones for the projects already in progress," he said. (BT)

    Source: CIMB Daybreak - 29 May 2013

    Leon Fuat's shares oversubscribed by 23.32 times

    Leon Fuat Bhd's public issue of 15.5m shares has been oversubscribed by 23.3x. A total of 14,132 applications for 377m shares were received from the public, it said yesterday. Half of the 15.5m shares were reserved for Bumiputera investors.The 15.5m public issue shares form part of Leon Fuat's initial public offering. The exercise also entails a private placement of 33.8m shares to selected investors, up to 31m offer-for-sale shares to Bumiputera investors and 10m shares issue for eligible directors and employees. (BT)

    Source: CIMB Daybreak - 29 May 2013

    StemLife MD on sabbatical leave for a year

    StemLife Bhd yesterday informed Bursa Malaysia that its managing director Datuk Low Su-Shing had applied for a 12-month sabbatical leave effective next month. During her absence, deputy managing director Datuk Lim Oi Wah will assume her duties. (BT)

    Source: CIMB Daybreak - 29 May 2013

    KNM secures orders worth RM307m

    KNM Group Bhd has secured additional new order intakes totalling RM307m, bringing its total order book to RM2.4bn to date. The amount excluded the group’s Peterborough and Orizon projects, says the company. Peterbourough is the company’s RM2.3bn investment in renewable energy plant in the United Kingdom, while Orizon is its RM70m gasification plant project. (BT)

    Source: CIMB Daybreak - 29 May 2013

    Maybulk expects POSHlisting by end-2013

    Maybulk expects its Singapore-based associate, PACC Offshore Services Holdings (POSH), to be listed by end of 2013 or early 2014 on the Singapore Exchange. Maybulk holds a 21% stake in the company. Maybulk expects POSH earnings to shine on expectations that oil and gas majors will increase their existing production levels, resulting in a higher capex for drilling and maintenance programmes. (Financial Daily)

    Source: CIMB Daybreak - 29 May 2013

    Time Engineering shares ahead of fundamentals?

    The price at which Khazanah Nasional's controlling block of Time Engineering shares would be sold is likely to be between 20 sen and 28 sen, sources said. Such a price, though, would be significantly lower than Time Engineering's current market price, which has been on an uptrend recently, pending the planned sale of the 45% block by Khazanah.

    “There's been excessive speculation going on... the concern is that the stock has run ahead of its fundamentals. The deal would be done at a price lower than the current market price,” the source added. (StarBiz)

    Source: CIMB Daybreak - 29 May 2013

    UOA Development will launch property projects worth RM1.5bn in 2H

    UOA Development will launch property projects worth RM1.5bn in 2H to meet its RM3.5bn annual target in GDV this year. Up to end-March, the company had tallied RM928m worth of property sales while its unbilled sales stood at RM1.1bn. (Financial Daily)

    Source: CIMB Daybreak - 29 May 2013

    Mah Sing buys 2 parcels of land for RM438.35m

    Mah Sing Group Bhd is buying two parcels of land in Iskandar Malaysia, Johor and Kuala Lumpur for a combined RM438.3m, bringing the total number of projects in the property developer's portfolio to 43 with a gross development value (GDV) and unbilled sales of RM26.4bn in the country. This provides earnings visibility of seven to eight years. Mah Sing said its unit Mah Sing Development Sdn Bhd (MSD) has signed an agreement to buy a 35.26-acre parcel of freehold land in Iskandar Malaysia from oil palm planter Kim San Investments Sdn Bhd for RM365.5m or RM238psf.

    "Presently the land is vacant and ready for development which fits in well with the group's quick turnaround business strategy... The land is located adjacent to Senibong Cove by Walker Corp from Australia along the Strait of Johor with prime views overlooking Singapore," said Mah Sing. (sun)

    Source: CIMB Daybreak - 29 May 2013

    Sale of JCorp prized asset Pusat Bandar Damansara to Malton to go ahead within six months

    Johor Corporation Bhd's CEO Datuk Kamaruzzaman Abu Kassim said the group will push through with the planned deal to sell its assets in Pusat Bandar Damansara to Malton Bhd. "They (Malton) have made the necessary announcements. Subject to those terms being met from a timeframe then it will be done. Otherwise it is (then) back to square one," Kamaruzzaman told journalists on Tuesday.

    Reports earlier stated that both JCorp and Malton were embroiled in a legal case in the courts as Malton-related entities were seeking to enforce a 2009 agreement, whereby Johor Corp had supposedly agreed to sell Pusat Bandar Damansara for RM700m. (Starbiz)

    Source: CIMB Daybreak - 29 May 2013

    Johor Corp plans to relist KFC Holdings and QSR Brands in 4-5 years time

    Johor Corp Bhd (JCorp) plans to relist KFC Holdings (M) Bhd and QSR Brands Bhd on Bursa Malaysia under a new entity in the next four to five years. JCorp president Datuk Kamaruzzaman Abu Kassim said it will do so once the two firms are leaner and on a better financial position.

    "A new initial public offering framework will be made for both companies. Just like the relisting of Maxis Bhd, we want to repackage and relist them on Bursa Malaysia," Kamaruzzaman said yesterday after signing a memorandum of understanding with Perbadanan Hal Ehwal Bekas Angkatan Tentera (Perhebat). (BT)

    KFC and QSR Brands were taken private last December in a RM5.1bn deal by special purpose vehicle Massive Equity. Massive Equity's shareholders are JCorp and the Employees Provident Fund (EPF), with the former holding a 51% stake. (BT)

    Source: CIMB Daybreak - 29 May 2013

    Ho Wah Genting eyes smaller loss this year

    Ho Wah Genting Bhd expects to record a smaller pre-tax loss in the current financial year ending Dec 31, 2013, as its manufacturing division begins contributing positively to group revenue. In the first quarter ended March 31, 2013, the company recorded a higher pre-tax loss of RM5.05m against a pre-tax loss of RM3.98m chalked up in the same period last year.

    The group, however, is confident it would return to the black next year as its manufacturing division is anticipated to contribute the main chunk of its earnings in 2014. "Barring unforeseen circumstances, the group is targeting to achieve a better operating and financial performance for the financial year next year," executive chairman Datuk William Teo said. (Bernama)

    Source: CIMB Daybreak - 29 May 2013

    SapuraKencana strengthening rig business by taking delivery of a new rig, T17

    SapuraKencana is strengthening its grip on the world's tender rig business by taking delivery of a new rig, T17. The state-of-the-art rig is designed for oil & gas development drilling with depths of up to 20,000ft. With the arrival of T17, the company now has 21 rigs. (Edge Daily)

    Source: CIMB Daybreak - 29 May 2013

    IJM Corp makes Soam deputy MD

    IJM Land Bhd managing director Datuk Soam Heng Choon has been appointed deputy managing director of parent company IJM Corp Bhd. The 53-year-old Soam had been appointed following the resignation of the current deputy managing director, Datuk Tan Gim Foo. Soam has been with IJM Land since 2004. He was appointed executive director of IJM Land and then as managing director before being redesignated as CEO in 2010. (Starbiz)

    Source: CIMB Daybreak - 29 May 2013

    Argentina, Indonesia Threatened With EU Biodiesel Tariffs

    The European Union imposed tariffs on biodiesel from Argentina and Indonesia, expanding renewable-energy trade barriers after EU import levies against the U.S. The duties punish Argentinian and Indonesian exporters of biodiesel, a type of biofuel made from vegetable oils and animal fats for use in diesel engines, for allegedly selling it in the EU below cost, a practice known as dumping. Molinos Rio de la Plata SA, Aceitera General Deheza SA and Pelita Agung Agrindustri are among the companies targeted by the levies as high as 104.92 euros ($135.46) a metric ton, or 10.6%.

    EU producers including Verbio AG (VBK) in Germany, Diester Industrie SAS in France and Novaol Srl in Italy suffered ¡§material injury¡¨ as a result of dumped imports from Argentina and Indonesia, the European Commission, the 27-nation bloc¡¦s trade authority in Brussels, said today in the Official Journal. The levies, due to take effect tomorrow, are for six months and may be prolonged for five years. (Bloomberg)

    Source: CIMB Daybreak - 29 May 2013

    London-based Gatehouse Bank plans to seek licences in M'sia

    London-based syariah-compliant Gatehouse Bank is considering applying for several banking licences in Malaysia to expand its business in Asia. Chief representative of Gatehouse Bank in Malaysia Richard Thomas said the bank would take two or three licences into consideration in universal banking, investment banking, and or, wealth management. The bank, which commenced operations in Malaysia yesterday via a representative office in Kuala Lumpur, would closely discuss licensing options with the Securities Commission and Bank Negara Malaysia. (StarBiz)

    Source: CIMB Daybreak - 29 May 2013

    Car prices will be reduced gradually until 2017

    Car prices will be reduced gradually until 2017, says International Trade and Industry Minister Datuk Seri Mustapa Mohamed. As outlined in the 13th General Election Barisan Nasional Manifesto, Mustapa said the government had promised to trim car prices between 20%-30% over five years. "In fact, since Oct-2012, the price of 10 popular models in the country have come down an average 7.3%," he told reporters after attending the ministry's monthly gathering, the first after Mustapa was re-appointed to the Cabinet.

    He said the price reduction was part of the market process as a result of more efficient and competitive players in the automotive industry. Mustapa said the price reduction exercise should be done in an orderly manner so as not to affect the industry's growth and existing jobs in the automotive and related industries. "As such, we have had discussions with automotive manufacturers and they are aware of ongoing negotiations to conclude a free trade agreement which would be implemented soon," he said. (Starbiz)

    Source: CIMB Daybreak - 29 May 2013

    Datuk Abdul Ghani Othman tipped to be Sime Darby's chairman?

    Datuk Abdul Ghani Othman is tipped to be Sime Darby Bhd chairman, a post left vacant following the retirement of Tun Musa Hitam on Nov 8 last year. Abdul Ghani¡¦s appointment will be announced soon, sources said. After Musa stepped down, the post of interim chairman of Malaysia¡¦s oldest conglomerate was filled by former chief secretary to the government, Tan Sri Samsudin Osman.

    Abdul Ghani was the Johor menteri besar for four terms, from Mar 1995. In the recent 13th General Election, he lost to DAP's Lim Kit Siang in the contest for the Gelang Patah parliamentary seat. (BT)

    Source: CIMB Daybreak - 29 May 2013

    EPF eyes Europe property assets

    The EPF plans to invest in more property assets, including in Europe, as part of its investment portfolio diversification drive. The world’s sixth largest provident fund’s newly-appointed CEO Datuk Shahril Ridza Ridzuan said the fund has property assets in Singapore, Australia and the UK and is looking at expanding its investments there and other parts of Europe due to a stable market and a good legal structure.

    “We are looking for domestic and global properties as the investment is recession-proof with steady income over time. “Properties with tenants such as big law firms, logistic centres, credit card processing and medical centres are good investments,” he said. (BT)

    Source: CIMB Daybreak - 29 May 2013

    CIMB Political News - 29 May 2013

    The split in the MCA leadership is now out in the open, with party president Datuk Seri Dr Chua Soi Lek at loggerheads with his deputy, Datuk Seri Liow Tiong Lai, over a corporate deal involving Matang Holdings. Liow yesterday held a press conference to register their objection to the proposed exercise to inject Matang, in which MCA has a 10.75% stake, into Scope Industries. Liow said the proposal was not brought up at the MCA central committee meeting for approval. (Financial Daily)

    PKR vice-president Tian Chua, a social activist Haris Ibrahim and PAS member Tamrin Ghafar have been re-arrested. A student activist, Safwan Anang was also arrested. However, Haris, Safwan and Tamrin were later released on bail. A statement from the police said a warrant of arrest was also obtained against social activist Hishamuddin Rais but it was not executed. "They have been re-arrested under the Sedition Act," lawyer and Puchong MP Gobind Singh Deo said. (Star)

    The Election Commission (EC) is now under the purview of the deputy prime minister. Tourism and Culture Minister Nazri Aziz said that EC is no longer under the purview of the de facto law minister, a position he held in the previous cabinet. The EC did not feature in the list of 11 agencies and government arms which fall under the new de facto law minister, Nancy Shukri. The Malaysian Anti-Corruption Commission (MACC) is also no longer under the purview of Nancy's position, though Nazri did not specify which Minister from the Prime Minister's Department would now be handling the MACC.

    • Shahidan Kassim - the former Perlis Menteri Besar who had been appointed as a Minister in the Prime Minister's Department - has been made the de facto law minister in charge of parliamentary affairs, a post Nazri had handled as well in the past. "Next week, I will be handing over duties to Shahidan in the Parliament building," said Nazri, who had today handed over part of his duties to Nancy at the Law Affairs Division in Putrajaya. 
    • It is noted that the Attorney-General¡¦s Chambers (AGC) will now come directly under the purview of the prime minister. (Malaysiakini)

    Source: CIMB Daybreak - 29 May 2013

    CIMB Malaysian Economic News - 29 May 2013

    Investor confidence in Malaysia continues to be strong, with foreign direct investment (FDI) increasing to RM18.3bn in 1Q13 against RM9.6bn in 1Q12. Malaysian Investment Development Authority (Mida) deputy CEO II Datuk Phang Ah Tong said the bulk of the FDI, or about RM11.7bn out of the RM18.3bn, was for manufacturing, while Asian countries continue to be the top investors in Malaysia.

    • "We expect interest to pick up. Many companies had put on hold their business plans due to the general election. Now that the election is over, they are undertaking their business plans. Continuity of the government will provide consistency to investors," he said. 
    • For the full year, Mida is targeting a total FDI of RM48bn for the manufacturing sector, RM60bn for the services sector and RM40bn for the primary sector. 
    • He added that the approved projects had an 80% implementation rate. (Starbiz)

    PM Datuk Seri Najib Tun Razak yesterday reiterated the government's promise to reduce the car prices in stages until 2017. In its pledge for the 13th general election recently, the Barisan Nasional promised to review the National Automotive Policy to reduce the price of cars between 20% and 30% in stages and to raise the competitiveness of the national cars, if given the mandate again to administer the country. (Bernama)

    PM Datuk Seri Najib Tun Razak said female labour force participation, which currently is at 47%, must be improved to ensure robust and sustainable growth in the country. More jobs aligned to women's needs should be offered to encourage their participation in the workforce such as through home-based, part-time or flexible working hours.

    • The government had put in place policies to encourage the shift, with reforms under the Economic Transformation Programme (ETP) that reinforced the need to attract, increase and retain women employees in the workforce. 
    • "We have several overarching targets for women in the workforce such as increasing female labour participation rate to 55%, and increasing the number of women working on public-listed company boards to 30%," he said. (Bernama)

    Malaysia is targeting RM3.3bn in global market value for aerospace and automotive engineering services by 2020. Performance Management and Delivery Unit (Pemandu) Director for Business Services National Key Economic Area (NKEA), Eugene Teh said the targeted jobs for specialised engineers in Malaysia by 2020 is 11,546, from about 500 at present. "To achieve the targets, we need to encourage more foreign direct investment, develop our own Malaysian capabilities, as well as training centres in the country," he said. (Bernama)

    The Malaysian Chamber of Mines (MCM) is eyeing up to 10% growth from the mineral resource sector over the next seven years moving into vision 2020. Its President, Datuk Seri Dr Mohd Ajib Anuar, said Malaysia's indigenous mineral and metals mining output generated an annual revenue of some RM6.9bn, a resounding increase of 9.8% from the year before, and well above the country's GDP growth of 5.6%.

    • Its contribution to the GDP will double to RM150bn in 2020, from RM69bn presently, he added. 
    • He also said there was an urgent need to establish the Malaysian Mineral Development Board or Mineral Board. 
    • The necessary paper work for the establishment of the mineral board had been completed, he hoped the Bill could be tabled in the June sitting of Parliament. (Bernama)

    The government is willing to receive views and proposals from various parties relating to the Trans Pacific Partnership (TPP) before it is finalised at year-end. Minister of International Trade and Industry Datuk Seri Mustapa Mohamed said the implementation of the TPP will ensure that the economic interest of the country is protected, more so, for the small medium enterprises sector as well as Bumiputera entrepreneurs. (Bernama)

    The government is fully committed to the development of intellectual property (IP) financing and its use as collateral by small and medium enterprises (SMEs) to expand their businesses. Finance Ministry deputy secretary-general (policy) Datuk Mat Noor Nawi said for a start, the government has initiated a RM200m IP financing scheme, to be offered through Malaysian Debt Ventures Bhd. The government is also providing a 2% interest rate subsidy and a 50% guarantee through Credit Guarantee Corp Malaysia Bhd. (BT)

    Employees Provident Fund (EPF) contributors will still be able to make partial and full withdrawals from their retirement funds at the ages of 50 and 55 despite the minimum retirement age being increased to 60 on 1 July. Newly appointed CEO Datuk Shahril Ridza Ridzuan said the new minimum retirement age would be advantageous to its 13.6m members.

    • On whether it was possible for EPF to pay higher dividends this year compared with last year's 6.15%, he said any change would not be too volatile. The fund's target is to pay dividends of at least inflation rate plus 2%. 
    • EPF invests up to 65% of its assets in fixed income and 35% in equities and others, he said. It invests less than 2% in the property sector. (BT)

    CIMB Global Economic News - 29 May 2013

    The US S&P/Case-Shiller 20-city home price index rose a seasonally adjusted 1.1% mom in Mar (a revised 1.3% in Feb), beating consensus of 1.0%. On a yoy basis, the measure gained 10.9% (a revised 9.4% in Feb), again outperforming consensus of 10.2%. (Bloomberg)

    The US Conference Board consumer confidence index rose to 76.2 in May from a revised 69.0 in Apr, beating consensus of 71.5. (Bloomberg)

    China’s leading index for Apr came at 99.8, compared with a previous reading of 99.3 which revised to 100. (Bloomberg)

    China's urban unemployment rate stood at 4.1% in 2012, unchanged from a year earlier. (Xinhua)

    Japan’s corporate service price index fell 0.4% yoy in Apr, from -0.2% in Mar. (Bloomberg)

    Japan’s small-business confidence index dropped to 48.2 in May from 49.4 in Apr, the second consecutive month of deterioration. (RTT News)

    Taiwan will let insurers invest in infrastructure projects and create a NT$1bn (US$33m) fund to channel money to companies. The island also plans to revise capital-gains tax rules, give cash incentives to trade in old cars for new ones, simplify visa procedures for Chinese visitors and set aside NT$400m to subsidize energy-saving home appliances including gas stoves and heaters. (Bloomberg)

    The Reserve Bank of India said it would ban banks and non-finance companies from giving loans against units held in gold exchange-traded funds and gold mutual funds because these products are backed by bullion. (WSJ)

    South Korea’s business survey index (BSI) for Jun declined 2.6 points from a month earlier to 97.2. The figure has shrunk for three straight months. A reading below 100 means pessimists outnumbering optimists. (Xinhua)

    South Korea’s current account surplus reached US$3.97bn in Apr, compared with a revised surplus of US$4.93bn the previous month. In Apr, the goods balance posted a surplus of US$3.59bn, down from a revised US$4.16bn surplus in Mar. (Yonhap)

    Thai government officials are working on new regulations that, among other things, could limit foreign purchases of short-term government bonds and require foreign investors to hedge some of their baht-denominated investments. He stopped short of saying that Thailand would introduce capital controls, but stressed that the country will be ready to implement them if needed. (WSJ)

    Thailand’s manufacturing production index declined 3.8% yoy in Apr (1.2% in Mar). Capacity utilisation dropped to 60.3% from 71% in Mar. (Bloomberg)

    Resale prices of private homes in Singapore rose at a faster rate of 1.9% in Apr, compared to the previous month's 1.1% price increase. (CNA)

    CIMB Daybreak - 29 May 2013

    What's on the Table...

    • Mah Sing Group - Transformational landbanking
    • UEM Land Holdings - Sizzling hot Iskandar
    • IJM Corp Bhd - Construction leads the pack
    • BIMB Holdings - Beating the speed trap for financing growth
    • Bintulu Port - Slow and steady
    • Hap Seng Plantations - A poorer 1Q harvest
    • IGB REIT - A good start
    • Oil & Gas - Equipment & Svs - Let's hook up!
    • Pelikan International - Ceasing coverage

    News of the Day...

    • Datuk Abdul Ghani Othman tipped to be Sime Darby's chairman?
    • Maybulk expects its associate, PACC Offshore Services to list in Singapore by year-end
    • Johor Corp plans to relist KFC Holdings and QSR Brands in 4-5 years time
    • UOA Development will launch property projects worth RM1.5bn in 2H13
    • Car prices will be reduced gradually until 2017
    • US Conference Board consumer confidence index rose to 76.2 in May (69.0 in Apr)

    Click here for the full PDF report 

    Tuesday, 28 May 2013

    SEGi in RM24m capex boost

    SEG International Bhd (SEGi) has allocated RM24m in capital expenditure this year for SEGi College Kuala Lumpur (SCKL) to boost its student enrolment in the near future. The college's head of business school Tony Leung said its business and accounting faculty would be upgrading its diploma and degree programmes, as well as setting up a master's programme in the future. SEGi has also initiated a number of other initiatives this year to improve its income stream.

    "One of the things we are developing and looking to launch very quickly is ensuring that our diploma students are able to migrate to a degree programme, especially in terms of making sure that our pricing is right," said group CEO Hew Moi Lan. (Financial Daily)

    Source: CIMB Daybreak - 28 May 2013

    DeGem to penetrate Thai market with new office

    DeGem Bhd, the manufacturer, retailer, designer and distributor of fine gemstone jewellery, will soon establish an office in Thailand to penetrate the market. The company is currently in preliminary discussions with several parties to make inroads into Thailand. Chief executive officer Stephen Choong Kai Fatt said the company wanted to take advantage of the Asean Free Trade Area (Afta), which would come into force in 2015, and was in talks with interested business partners to set up an office in that country. (Starbiz)

    Source: CIMB Daybreak - 28 May 2013

    YTL Communications hopes to break even next year

    YTL Communications Sdn Bhd, the telecommunications arm of YTL Corp Bhd, expects to break even next year by increasing its Yes subscriber base, says its executive director Datuk Yeoh Seok Hong. Yes, a brand under YTL Communications, offers fourth-generation (4G) mobile Internet services with voice using WiMAX technology. YTL Communications is currently registering losses due to the high start-up and fixed operating costs. For the fiscal year 2011, it recorded a net loss of RM197m. (Btimes)

    Source: CIMB Daybreak - 28 May 2013

    Gromutual plans RM700m projects in Johor Baru

    Gromutual Bhd is targeting to launch projects with RM700m in gross development value (GDV) here over the next few years. Gromutual deputy managing director Chew Kwee Hiok said the company plans to further tap opportunities in the rapidly growing Iskandar Malaysia region.

    "Besides the inherent demand for housing and commercial properties in Johor, many foreign investors, especially Singaporeans and multinational corporations, have also set their sights on Iskandar, not only just for investment opportunities and to set up manufacturing facilities," Chew said at the company's shareholders' meeting yesterday. (BT)

    Source: CIMB Daybreak - 28 May 2013

    UMW Holdings reported to be bidding for Australia's Coates Hire?

    UMW holdings is reported to be bidding for Australia's Coates Hire, a company which rents out equipment, reports said on Monday. “Final bids in the Goldman Sachs-advised auction are due early next month and the owners are hoping for a price tag of more than A$3bn (RM11.8bn),” according to Australia's Financial Review Sunday. It said among the bidders were Wesfarmers, Japanese trading giant Mitsui and hedge fund Apollo Global Management. Kerry Stokes's Seven Group and private equity firm The Carlyle Group jointly own Coates Hire. (StarBiz)

    Source: CIMB Daybreak - 28 May 2013

    Nestle aims RM300m sales from Sabah, Sarawak this year

    Nestle Malaysia is expecting an increase in projected sales to RM300m this year from Sabah and Sarawak, from RM262.8m in 2012, with products mainly sourced from its Sejingkat factory here. Managing director Alois Hofbauer said today, the company was also looking at expansion plans for the 38,000 sq m factory, which currently produces the Maggi instant noodles and Nestle ice cream brands, with new production lines. (Bernama)

    Source: CIMB Daybreak - 28 May 2013

    UEM Land will start selling RM4bn new residential and commercial projects this year

    UEM Land Holdings Bhd, Malaysia's biggest developer by market value, will start selling RM4bn (US$1.3bn) of new residential and commercial projects this year, targeting Singaporean buyers. Three-fourths of new developments will be at Nusajaya, Johor, where new condominium prices have more than doubled since 2009, said CEO Datuk Wan Abdullah Wan Ibrahim. That's within the 222,600ha Iskandar Malaysia economic zone, promoted by the Government to tap demand from neighbouring Singapore for everything from seafront homes to oil storage. (Starbiz)

    Source: CIMB Daybreak - 28 May 2013

    Malaysia's IHH expands to Vietnam with new upmarket 320-bed hospital

    The latest addition to IHH Healthcare Bhd's stable of hospitals would be the upmarket City International Hospital in Vietnam, a 320-bed hospital scheduled to be ready by the first half of this year, industry sources said. It is understood that the nine-storey hospital, located in the International Hi-Tech Healthcare Park in Ho Chi Minh City, would be owned indirectly and managed by Parkway Pantai Ltd, a unit of IHH, and is in the final stages of preparation prior to its launch. (Starbiz)

    Source: CIMB Daybreak - 28 May 2013

    Scania bags Prasarana contract to supply 360 city buses

    Scania (Malaysia) Sdn Bhd has bagged a contract from Syarikat Prasarana Negara Bhd (Prasarana) to supply 360 city buses. The buses would be for the Rapid KL and Rapid Kuantan. It said its 250 UB 4x2 buses were configured with low floor chassis with safety features such as handicap excess capability for all passengers. The buses were equipped with a ramp for full wheelchair access and two docking slot with seatbelts for safe wheelchair anchorage. The body is made of aluminium to reduce weight and fuel consumption, as well as to extend vehicle life. (StarBiz)

    Source: CIMB Daybreak - 28 May 2013

    MRT Corp awards two work packages worth RM54m for MRT SBK Line

    MRT Corp has awarded two work packages for fire detection and protection systems for MRT SBK Line with a total value of RM54.3m. RM31.9m worth of works which covers packages V1, V2 and Sg. Buloh was awarded to to P.J. Indah Sdn Bhd. RM22.3m worth of works that covers packages V7, V8 and Kajang Depot was awarded to Mecomb Malaysia Sdn Bhd. MRT Corp CEO Dato’ Azhar Abdul Hamid said there are 19 packages remaining that are yet to be awarded from the 85 total packages for the project.

    • “In a period of 18 months, we completed awarding the main civil works, and all system works packages. Now, we are awarding the remaining work packages, with the contracts for multi-storey carparks, LED lighting, furniture, signage and escalators for underground stations remaining. 
    • With the project progress now at 14% and growing, more and more contracts will be awarded in the coming months,” he said. (MRT Corp. press release)

    Source: CIMB Daybreak - 28 May 2013

    Berjaya eyeing Metro Manila's three mass rail system's common ticketing system

    Berjaya Group Bhd via Berjaya Philippines Inc is eyeing the 1.72bn pesos (RM125.6m) common ticketing system for Metro Manila's three mass rail systems. Berjaya Philippines, in a consortium known as Comworks Consortium, has been shortlisted to bid for the common ticketing system or automated fare collection system (AFCS) for Light Rail Transit Lines 1 (LRT1) and 2 (LRT2) and the Metro Rail Transit Line 3 (MRT3).

    Other partners in the consortium are Kaosheung Rapid Transit Corp, Acer Inc and InfoChamp System Corp, according to Philippines' Department of Transportation and Communications (DOTC). (Starbiz)

    Source: CIMB Daybreak - 28 May 2013

    Dayang receives letter of award from Petronas Carigali

    Dayang Enterprise has received a letter of award from Petronas Carigali for the provision of hook-up, commissioning and topside major maintenance services for five years effective 21 May 2013. The value of the contract is not disclosed. (BMSB)

    Source: CIMB Daybreak - 28 May 2013

    SapKencana receives RM300-500m job from ExxonMobil

    SapuraKencana has received a letter of award from ExxonMobil for the provision of hook-up, commissioning and topside major maintenance services for a primary term of five years with an option to extend for another year. The total value of the contract is estimated to be between RM300m to RM500m. (BMSB)

    Source: CIMB Daybreak - 28 May 2013

    SC looks into trading platform for unlisted firms

    The Securities Commission is looking into an unlisted market where unlisted companies or small and medium enterprises (SMEs) can raise funds for growth financing, fast-tracking their transition to listing in a public market. The SC said on Monday the platform could also provide an exit avenue for existing founders and investors of these SMEs. "Under this platform, fund raising by these SMEs would be conducted in a more efficient, organised, and transparent manner," it said.

    The SC has already carried out jurisdictional studies and conducted a series of engagement sessions with relevant stakeholders in 2012. "The conceptual framework has been internally approved and currently, the SC is conducting further in-depth engagements with relevant stakeholders," it said. (Starbiz)

    Source: CIMB Daybreak - 28 May 2013