Friday, 28 June 2013

PJBumi wins power plant contract

PJBumi received an LOA from Manifest Frontier Sdn Bhd for engineering, procurement and construction (EPC) works for the proposed development of 18 MW to 24 MW small hydro power plant in Lenggong, Gerik, Perak. The value of the contract will be determined after it completes the pre-power purchase agreement (PPA) works. (StarBiz)

Pestech, ABB in switchgears tie-up

Pestech Sdn Bhd, a unit of Pestech International Bhd, is investing RM15m to RM20m in a plant to produce air insulated switchgear in collaboration with ABB Malaysia Sdn Bhd. The plant will commence construction in seven to 12 months and is slated to be completed in 2015. (Financial Daily)

Encorp unit bags RM69.9mil construction job

Encorp Bhd via its unit Encorp Construct Sdn Bhd has secured a RM69.9m construction contract from NRY Architects Sdn Bhd for the main contract works fora 30-storey serviced apartment at Jalan Raja Chulan, Kuala Lumpur. The contract was for 27 months from June 28, 2012 to Sept 27, 2015. (StarBiz)

Ho Hup on track to exit PN17 status by Q4

Ho Hup Construction Co Bhd expects to complete its financial regularisation plan by the fourth quarter of this year. Its executive director Derek Wong Kit Leong said the company has received Bursa Malaysia's approval for its regularisation proposal on May 13, 2013. "Based on the listing requirement, we will apply to Bursa for upliftment of Practice Note 17 (PN17) status after we have achieved two consecutive quarters of profits upon completion of the proposed regularisation exercise," he said.

For its future growth, Wong said the company aims to focus on property development, construction and the ready mixed concrete business. "Ho Hup has a long track record in the property development and construction sectors and we will continue to leverage on our core business strengths and build on our vast experience for renewed growth," he added. (sun)

Proton Edar to push up sales of Saga SV by July

Proton Edar Sdn Bhd aims to strengthen sales of the new Saga SV by July. CEO Hisham Othman said the company had recorded more than 6,000 bookings within two weeks of the launch of the new variant on June 15, exceeding expectations. “At this early stage, we expect to sell at least 2,000 units of the Saga SV monthly, with nationwide bookings being very good. “We can deliver, at present, at least 3,000 units monthly to buyers,” he said. (StarBiz)

UMW to spend RM1.3b on capex, list O&G unit this year

UMW Holdings Bhd has allocated RM1.3bn for capital expenditure (capex) this year that includes a RM300m spending to boost its Toyota distribution and sales business. The group has also set aside RM600m of the total capex to grow its oil and gas (O&G) division that is targeted for a listing on Bursa Malaysia by the end of the year. UMW had submitted a plan last month to list its O&G division. Chairman Tan Sri Asmat Kamaludin said the proposal is pending approval from the Securities Commission. (sun)

Muhibbah gets Petronas licence

Muhibbah Engineering has been awarded a licence by Petronas as an approved supplier for offshore facilities construction and major onshore fabrication works. This allows the company to tender and participate in upcoming offshore facilities construction and major onshore fabrication works for Petronas, as well as other oil operators in Malaysia. (StarBiz)

UEM-Bina Puri JV appeals against the LAD fine on KLIA2 construction

UEM-Bina Puri JV, the main contractor of KLIA2, is appealing against the LAD fine slapped on it by MAHB. The JV would appeal based on the terms and conditions of the contract that stated that the contractor could appeal for an extension of time (EOT) to finish up the work, as there had been many last-minute requests and additional changes made by stakeholders. With MAHB invoking the LAD, the JV stands to pay a RM6m monthly fine, amounting to RM63.4m, assuming it only hands over the airport on April 30, 2014, the new completion date for KLIA2. (StarBiz)

Iskandar-S'pore rail link to be ready by 2016

The proposed 100km inter-city rail line between Iskandar and Singapore is set to be completed within the next three years, Masteel CEO Datuk Seri Tai Hean Leng said. "As soon as the requisite fund is finalised, we will proceed with the construction of the rail line, hopefully be early next year." he said. The rail system will be built and operated by Metropolitan Computer Network Sdn Bhd, a 60:40 JV between Masteel and KUB. The RM1bn project will be divided into two parts, the first involving the rehabilitation of the railway line between Pasir Gudang and PTP. The second part involves the construction of 21 train stations by KUB. (Financial Daily)

Myanmar Awards Licenses To Telenor and Qatar Telecom

Myanmar awarded cellular-phone licenses to Telenor and Qatar Telecom, ending months of speculation over which foreign consortia would get the nod. Ten other bidders had sought to build out networks in Myanmar, a country of around 60m people with less than 9% mobile phone penetration. Among the bidders who didn‟t make the cut were France Telecom, Singapore Telecom, Bharti, Axiata and Digicell. (Forbes)

SapuraKencana Petroleum wins a RM8.9bn PLSV contract

SapuraKencana Petroleum has been awarded a RM8.9bn contract from Brazil's Petroleo Brasileiro S.A. (Petrobras) to build, charter and operate three additional deepwater flexible pipe laying support vessels (PLSVs). Sapura Navegacao Maritima S.A. Brazil (SNM), a JV between the group's unit TL Offshore Sdn Bhd and Seabras Servicos De Petroleo S.A., had won the contract by open tender. (Starbiz)

TNB Remaco will tender for a power plant O&M job in Iraq

Tenaga Repair and Maintenance Sdn Bhd (TNB Remaco) will tender for a power plant operation and maintenance job in Iraq in the next few months and expects results for its tender in Saudi Arabia to be announced in July. TNB Remaco is also looking at opportunities in markets like Nigeria in Africa. (Malaysian Reserve)

Sarawak experienced a blackout yesterday

Most areas of Sarawak experienced a power blackout this evening because of tripped circuits at the Kemena-Bintulu transmission line at 5.40pm, said Sarawak Energy Berhad (SEB) corporate communications manager Ahadiah Zamhari in Kuching. She said SEB's engineers and technicians were working to restore power. Electricity was restored in certain areas of Kuching by 6.30 pm and in Bintulu at 8.15pm. In Miri, the residents were without electricity until 8.30pm while the blackout had also earlier caused traffic jams in the city centre. In Limbang, however, there was minimal disruption around 6pm and the power supply was restored later. (Bernama)

CIMB Political News - 28 June 2013

Former Election Commission chief Tan Sri Rashid Abdul Rahman said the electoral body is very weak and that he is more concerned about structural issues like the government's monopoly of the mainstream media rather than the indelible ink fiasco.
  • Rashid said the EC is weak because they do not have much power and should be forgiven for the indelible ink fiasco. He said the failure of the .indelible. ink was not "intentional" and that it was the EC's first attempt to use it, at the recent General Election. 
  • What should be of more concern, Rashid said, is that there were missing components in the country's laws which could enhance the democratic process. "There are structural changes which should be introduced. They can strengthen the election process, which is what I support," he added. 
  • He said the control on usage of the mainstream media was one aspect that needed immediate attention. "This is a big issue. If only one party is allowed to campaign through a certain TV channel, then it is not good for the election process," he said. "Similarly, the monopoly of mainstream newspapers by the government to provide only pro-government news is not good." (Malaysian Insider)

Former Indonesia VP Jusuf Kalla claims that opposition leader Datuk Seri Anwar Ibrahim has received aid for "Blackout 505" rallies from several parties including Turkey, Washington, the Philippines, and "maybe even from Thailand and China".
  • "I had asked Anwar if he can control DAP and he kept quiet. He could not give a clear answer. It was obvious that Anwar has problem controlling the members of parliament from other parties." 
  • Jusuf said he received a call from Indonesian President Susilo Bambang Yudhoyono recently, asking him about a phone call from Washington asking if he could accept Anwar's request to meet him. "I told Susilo not to give in to Washington's pressure and that it was against our practice to accept Anwar's request as he is only the opposition (leader in Malaysia) and not the PM." 
  • On the Lahad Datu armed intrusion, Jusuf said he knew that there had been interference from certain parties in the Philippines. He claimed that Anwar's friends, such as former Philippine president Joseph Estrada, and a giant company in Philippines had provided financial assistance. (NST)


CIMB Malaysian Economic News - 28 June 2013

The Trans Pacific Partnership Agreement (TPPA), which is under negotiations, will not rob the country's sovereignty as it does not restrict the government to regulate or take the necessary steps to protect the nation's rights and sovereignty. The assurance was given by International Trade and Industry Minister Datuk Seri Mustapa Mohamed who said there was no provision in the TPPA particularly in investor-state dispute settlement (ISDS) that could threaten the sovereignty of the country. (Bernama) 

The government has yet to decide when it will implement the goods and services tax (GST), said Finance Minister II, Datuk Seri Ahmad Husni Hanadzlah. He said the government has launched a study to compare the impact of the GST on the economy and the current prices with that of the earlier study in 2009.
  • The study was undertaken again because of the changes in the economy and the prices, he said. 
  • The government stands to gain an estimated RM6bn in additional revenue by 2015 if the GST is implemented. Adding to the current sales and service tax revenue of some RM20bn, the total revenue will be in the region of RM26bn by 2015, he said. (Bernama, Financial Daily)


Malaysia is ranked the 16th Top Prospective Host Economy for the period 2013 until 2015, up three spots, according to the World Investment Report 2013 released by the United Nations Conference on Trade and Development (UNCTAD). The ranking was based on the percentage of respondents selecting an economy as a 'top destination'.
  • In 2011, Malaysia was ranked 11th among the top 20 economies with the highest Foreign Direct Investment (FDI) rates of return, or FDI profitability, at 17%.
  • Malaysia also maintained its ranking as the third largest recipient of FDI in Asean, the report said, adding the country's net FDI inflows last year saw a decrease of 17.4% in investment to US$10.1bn compared to US$12.2bn in 2011. (Bernama)


Cagamas Bhd has successfully completed the sale of RM150m conventional medium term notes (CMTN). It said proceeds from the issuance will be used to finance the purchase of conventional financing from the financial system. (Bernama) 

Amanah Saham Nasional Bhd (ASNB) yesterday announced an income distribution of 7.1 sen per unit for Amanah Saham Nasional 2 (ASN 2) for the financial year ended 30 Jun 2013, up 0.6 sen per unit over the 6.5 sen per unit last year and the highest dividend payout since 2001. The income distribution portion will involve a total payout of RM12.61m for 8,145 unit holders who subscribe to 178m shares. (BT)

Malaysia's lower net foreign direct investment (FDI) inflows are a reflection of it seeking quality investments, according to International Trade and Industry Minister Datuk Seri Mustapa Mohamed. While Malaysia's gross FDI inflows have gone up, the net inflows have recorded a dip accommodating higher outflows through repayment of inter-company loans, trade credits and other capital payments. He reassured that the numbers did not mean Malaysia was losing its attraction as an investment destination. (Malaysian Insider) 

The Works Ministry has set up a special committee to look into the construction industry's work procedures. The ministry said the committee, which was formed this month, will also propose recommendations on improvements on existing procedures to be considered by the government. The committee will comprise experts in the construction industry in the country, it said. (The Sun)

CIMB Global Economic News - 28 June 2013

US jobless claims fell 9,000 in the 22 Jun week to 346,000 (a revised 355,000 in the earlier week), still above the consensus estimate of 345,000. (Bloomberg) 

US personal income rose 0.5% mom in May from a revised 0.1% in Apr, exceeding consensus of 0.2%, whilst consumer spending increased 0.3% mom (a revised -0.3% in Apr), underperforming consensus of 0.4%. The PCE price index gained 0.1% mom after contracting 0.3% in Apr, matching consensus, whilst the core PCE price index rose 0.1% mom (a revised 0.0% in Apr), matching consensus. (Bloomberg)

US pending-home sales index rose 6.7% mom in May after contracting 0.5% in Apr, outperforming consensus of +1.0%. (Bloomberg) The European Commission’s headline Economic Sentiment Indicator rose to 91.3 in Jun from a revised 89.5 in May to reach its highest level since May 2012. The business climate indicator registered at -0.68 from a revised -0.75 in May, worse than consensus of -0.65. Industrial confidence rose to -11.2 from -13.0 in May, better than consensus of -12.3, whilst the consumer confidence index remained at -18.8, matching consensus, whilst services confidence fell to -9.5 from a revised -9.2 in May, worse than consensus of -8.5. (Bloomberg) 

Eurozone M3 money supply grew 2.9% yoy in May (3.2% in Apr), matching consensus. (RTT News) 

China’s industrial profits surged 12.3% yoy to reach Rmb2.08tr in the first five months of the year (11.4% in Jan-Apr). Japan’s all-industry activity index rose 0.4% mom in Apr from -0.3% in Mar. Economists expected a reading of +0.5%. (Bloomberg) India’s current account deficit shrank substantially to US$18.1bn in 1Q13, compared with a revised US$31.9bn shortfall in the previous quarter. (Bloomberg) 

Taiwan's central bank left its policy rate steady at 1.875% for an eighth straight quarter. (Dow Jones) 

Vietnam’s GDP in the second quarter ending June rose 5% yoy, a slightly faster pace than the 4.8% seen in the first quarter. (Bloomberg, Reuters) 

Vietnam’s exports rose 16.1% yoy in 1H13, compared with 15.1% in the Jan-May period. Imports climbed 17.4%, beating the 16.8% pace set in Jan-May. The trade deficit was reduced to US$200m from US$553m the previous month. (Bloomberg) 

Retail sales growth in Vietnam for the year-to-Jun was unchanged at 11.9% yoy. (Bloomberg)

Industrial output in Vietnam grew 6.5% yoy in Jun, a tick down from 6.7% the previous month. (Bloomberg)

CIMB Daybreak - 28 June 2013

What's on the Table...
  • SP Setia - Eroding premium valuations
  • Gamuda - Strength in its core
  • Banks - No DIBS, no problem
  • HELP International Corp - Hit by start-up costs
  • Economic Update - FDI: down but not out


News of the Day...
  • SapuraKencana Petroleum wins a RM8.9bn PLSV contract
  • UEM-Bina Puri JV appeals against the LAD fine on KLIA2 construction
  • Iskandar-Singapore Inter-city rail line to cost RM1bn
  • Muhibbah Engineering gets Petronas licence for offshore and onshore works
  • Sarawak experienced a blackout yesterday
  • TNB Remaco will tender for a power plant O&M job in Iraq



Click here for the full PDF report 

Thursday, 27 June 2013

Nadayu may go for re-listing exercise

A re-listing exercise is possible for Nadayu Properties, which is undergoing a privatisation by its major shareholders, according to the chairman Hamidon Abdullah. "Nadayu is evolving for the better by going private," he said. Nadayu was eyeing sales of RM300m this year. (StarBiz)

Source: CIMB Daybreak - 27 June 2013

No plan to privatise Maxwell

Maxwell International Holdings Bhd is not considering taking the company private at the moment but may consider the option in the future should business dynamics change, said executive director and chief executive officer Xie Zhen'an. He was responding to speculation that Maxwell would consider privatisation given that its share price has been undervalued by the Malaysian market since its listing in Jan 2011 at an IPO price of 54 sen. (Starbiz)

Source: CIMB Daybreak - 27 June 2013

ETI Tech reprimanded by Bursa Malaysia

Bursa Malaysia has publicly reprimanded ETI Tech Corp Bhd for failing to make an immediate announcement in respect of the default in payments of credit facilities by its major subsidiary. It said while it had not found any of the company’s directors to have caused or permitted the breach by the company, the regulator would like to highlight that it was the duty of the directors to maintain appropriate standards of responsibility and accountability. (Starbiz)

Source: CIMB Daybreak - 27 June 2013

Censof targets 20% revenue increase

Censof Holdings Bhd expects to increase revenue by 20% in 2013, driven by its ongoing and existing projects. Group managing director Datuk Samsul Husin said the company had secured multiple projects including the Outcome-Based Budgeting from the Finance Ministry and from the Social Security Organisation worth RM22.5m and RM33.1m respectively. “We are confident of achieving better performance this year based on market developments and business trends,” he told reporters after the company’s AGM here yesterday. (Bernama)

Source: CIMB Daybreak - 27 June 2013

Guan Chong: Volatile global cocoa prices to be over soon

Cocoa processor Guan Chong Bhd expects the volatile global cocoa prices arising from lower demand and overcapacity to be over by the end of the year. Managing director and chief executive officer Brandon Tay said in a statement following the company’s AGM that the cocoa grinding industry had a bad start to the year, particularly due to the economic uncertainty in the eurozone, which had then affected prices and demand for cocoa ingredients. “We, however, remain optimistic that the uncertainty in the global cocoa markets would be over by year-end,” he said.

Tay saw “some sweet spots” in Asia, which the company aimed to tap on the back of the rising demand for chocolates. He also expected a rising take-off of the company’s capacity from the food and beverage (F&B) multinational corporation customers in the region due to rapidly rising consumption of cocoa-based products. The grinding of cocoa beans in Asia continued to surge to 897,000 tonnes in 2012/2013, versus 874,000 tonnes in 2011/2012, according to estimates by the International Cocoa Organisation. (Starbiz)

Source: CIMB Daybreak - 27 June 2013

SMR Technologies buys 70% stake in university

SMR Technologies Bhd is strengthening its muscles in the education scene via the 70% stake in Cyberjaya University College of Medical Sciences it proposed to acquire in May. Shareholders approved the proposal at the company's EGM on Wednesday. The education business came with a RM 27.5m price tag. (Starbiz)

Source: CIMB Daybreak - 27 June 2013

Kimlun wins RM43mil Singapore contract

Kimlun Corporation Bhd has secured a S$17.1m (RM43.4m) contract to provide tunnel linings for Singapore's East-West transmission cable tunnel project EW2. It said on Wednesday its unit SPC Industries Sdn Bhd had accepted the letter of award from SK Engineering & Construction to supply precast concrete tunnel segment linings. "The supply of the tunnel linings is expected to spread over a period of approximately 33 months," said Kimlun. (Starbiz)

Source: CIMB Daybreak - 27 June 2013

Biosis enters PN17 due to low paid-up capital

Bursa Malaysia announced yesterday that Biosis Group Bhd has triggered the criteria pursuant to Practice Note 17 (PN17) of Main Market listing requirements. As of financial year 2013, the company’s shareholders equity was less than 50% of the total paid-up capital, therefore it is considered a PN17 firm. (BT)

Source: CIMB Daybreak - 27 June 2013

YTL in talks to buy Spanish trains for klia2

YTL Corp Bhd is in talks with Spanish manufacturers to buy up to four train sets worth some RM150m to serve the Kuala Lumpur International Airport 2 (klia2), sources said. The company has a 30-year concession, held via 50%-owned unit Express Rail Link Sdn Bhd (ERL), to operate the KLIA Express and KLIA Transit on the railway line between KL Sentral in Brickfields and the Kuala Lumpur International Airport. The railway line is currently served by 12 electric high-speed trains. The trains were acquired from German-based Siemens AG. ERL is extending the railway line to link it to Klia2 for about RM100m.

ERL chief executive officer Noormah Mohd Noor said in May that the railway line extension will increase ridership by 40% to 7.4m. "Trains supplied by Siemens cost 30% more than its competitors and YTL wants to keep spending low. It is sourcing for cheaper trains," sources said. (BT)

Source: CIMB Daybreak - 27 June 2013

SME Bank targets 6pc profit growth

SME Bank is targeting 6% growth in profit for its financial year ending 31 Dec 13. MD Datuk Mohd Radzif Mohd Yunus said the 2012 profit was slightly lower than the RM125.7m recorded in the previous year that was achieved on a better debt recovery. "It is the operating profit that matters to us as last year it increased twofold to RM146m," he said at a press conference after announcing the company's 2012 financial results yesterday. (BT)

    Source: CIMB Daybreak - 27 June 2013

    Hong Leong Cap shares to be suspended

    Share trading in Hong Leong Capital Bhd will be suspended from Aug 12, due to low public shareholding spread. As at yesterday, Hong Leong Capital public shareholding spread was just 9.63%, below the 25% requirement set by Bursa Malaysia. In a statement, the company said it currently does not have any plan to address the non-compliance and requires time to assess the situation. (BT)

      Source: CIMB Daybreak - 27 June 2013

      PKNS willing to sell stake in PJ Sentral to Nusa Gapurna at the right price?

      PKNS Holdings Sdn Bhd is willing to sell its stake in PJ Sentral Development Sdn Bhd (PJSD) to Nusa Gapurna Development Sdn Bhd (NGD) if the price is right, settling their dispute out of court. Although PKNS has filed the case in the court, there is still room for negotiations between the PJSD shareholders. PKNS has not put a stop to anything. It is willing to settle out of court provided it gets a fair value for its share in PJSD," said an industry source.

      • PKNS officials declined to comment when contacted by BT. PKNS Holdings is a wholly-owned subsidiary of PKNS, the Selangor state development corporation. PJSD is a 70:30 joint venture company between NGD and PKNS Holdings. NGD is in turn 60% owned by Gapurna Sdn Bhd (GSB) , and 40% by the Employees Provident Fund (EPF). 
      • The company is developing PJ Sentral on a 4ha site in Petaling Jaya, Selangor. The source said property experts value PJ Sentral at more than RM300m. This means that PKNS' 30 per cent share in the project should be worth slightly more than RM100m. (BT)

        Source: CIMB Daybreak - 27 June 2013

        FGV in process of evaluating 12 acquisition proposals

        Felda Global Ventures Holdings (FGV) does not discount potential upstream activities in Africa as well as consolidation by expanding into countries like Myanmar, Laos and Cambodia, says outgoing president and CEO Tan Sri Sabri Ahmad. FGV, with a war chest of RM3.8bn, expects to finalise some acquisitions in the third quarter of this year, in line with its plans to expand operations in the upstream and downstream segments.

        "Since our IPO (initial public offering), FGV has received many proposals, but we are now evaluating the feasibility of about 12 and they are in various stages of internal and external evaluations and approvals," he told reporters here yesterday after FGV's maiden annual general meeting. (BT)

          Source: CIMB Daybreak - 27 June 2013

          Sime Darby deny that it was involved in the current forest fires in Indonesia

          Sime Darby Bhd denied that it was involved in the current forest fires in Indonesia. Its plantation arm Sime Darby Plantation Sdn Bhd provided satellite data of its concession areas in Indonesia, which confirmed that there were no fires on its operating areas in Riau. The concessions areas are operated by its PT Tunggal Mitra Plantation (PT TMP) and PT Bhumireksa Nusa Sejati (PT BNS).

          "The matching of the hotspot data and the maps of the concession areas showed that all hotspots were outside of PT TMP's concession. There were three hotspots within PT BNS' concession area. However, they are located outside of the company's operating area. As explained previously, local communities occupy and plant cash crops such as corn, sugarcane and pineapple as well as perennial crops such as coconut and areca nuts on these lands," Sime Darby said in a statement. (Financial Daily)

            Source: CIMB Daybreak - 27 June 2013

            Exports of Malaysian palm oil products from June 1 to 25 rose 9.6% yoy

            Exports of Malaysian palm oil products from June 1 to 25 rose 9.6% from shipments over the same days in May to 1,167,266 tonnes, cargo surveyor Intertek Testing Services said on Tuesday. But investors were concerned that a liquidity crunch in China, palm oil's second-largest buyer, and a tapering of the U.S. Federal Reserve's stimulus programme might shrink demand for commodities. "Global economic fears are keeping the bulls at bay for now," said a trader with a local commodities brokerage in Kuala Lumpur. "But we may see a rebound on higher exports and potentially lower stocks." (StarBiz)

              Source: CIMB Daybreak - 27 June 2013

              RHB, PT Mestika extend deal period

              RHB Investment Bank Bhd announced that RHB Bank Bhd and PT Mestika Benua Mas have mutually agreed to extend the period of conditional sale and purchase agreement for the proposed acquisition of a 40% stake in Bank Mestika for about RM651.13mil to Sept 30. (Starbiz)

              Source: CIMB Daybreak - 27 June 2013

              UOA Development buys 11 acres land in Kuala Lumpur for RM130.3m

              UOA Development has acquired six parcels of freehold land in Kuala Lumpur, measuring a total of 483,322.71 square feet, for a purchase consideration of RM130.33m. In a filing to Bursa Malaysia today, UOA said the deal was entered through a sales and purchase agreement between its wholly-owned unit Tiarawoods Sdn Bhd and Ng Kim Khin @ Ng Beh Leow.
              • UOA said it intends to develop the land in Jalan Ipoh in Mukim Batu, combined with its currently-owned 16.8 acres of existing land, into an integrated mixed development which is expected to commence in the year 2014. 
              • UOA said as the proposed development is surrounded by densely populated residential areas such as Taman Kok Lian, Taman Impian, Taman Sri Kuching and Taman Rainbow, it will be highly accessible via major highways such as Duta-Ulu Klang Expressway (DUKE) and Jalan Kuching. (Bernama)

              This announcement is not a surprise as UOA Dev has been trying to add to its landbank in strategic locations and its combined land size in Jalan Ipoh has now expanded from 17 acres to 27 acres. With a plot ratio of around 4x, we estimate the combined project will have a GDV of approximately RM3bn. The purchase price of RM270 psf can be considered cheap as cost per plot ratio works out to be only RM68 psf and we believe selling prices of residential property in that location should be able to fetch above RM500 psf.

              Source: CIMB Daybreak - 27 June 2013

              CIMB Political News - 27 June 2013

              Datuk Seri Anwar Ibrahim's political fight will not end until daughter Nurul Izzah becomes the president of Parti Keadilan Rakyat and leader of the Pakatan Rakyat. Anwar is said to be also torn between PKR's deputy president, Azmin Ali, and Nurul Izzah, as to who would lead it. Observers believe PKR's general assembly, which his supposed to include party elections, has been postponed to give Anwar time to plan for a status quo or no-contest condition. (Malay Mail) 

              Food colouring, not chemicals, was in the indelible ink used in the general election, the Election Commission (EC) admitted today in the Dewan Rakyat. "No chemical was used in the ink but it was instead replaced with permitted food colouring," said Minister in the Prime Minister's Department Datuk Seri Shahidan Kassim in his reply to Segambut Member of Parliament Lim Lip Eng.

              • His statement was in stark contrast with the EC's claim that it used silver nitrate in the ink. He said the absence of the required chemical was the reason the ink was easily washed off. Shahidan also said that the expiry date of the ink was four months from the date it was issued but blamed voters for purposely trying to wash off the ink as the reason why it was not permanent. 
              • "How long the ink remains depends on the individual and the efforts put in to wash it off." In a written response, Shahidan also told the Dewan Rakyat that RM6.9m had been spent on the ink, with an additional RM200,000 spent on transportation, packaging and storage, bringing the total expenditure to RM7.1m. (Malaysian Insider)

              The government is considering allowing automatic registration of voters once they turn 21 but will not make voting compulsory. A check with the Election Commission yesterday revealed that a team was already conducting a feasibility study. (NST)

              Source: CIMB Daybreak - 27 June 2013

              CIMB Malaysian Economic News - 27 June 2013

              There is growing optimism amongst Malaysian manufacturers on improvements in business conditions, despite uncertainties in the global economy, said the Federation of Malaysian Manufacturers (FMM). Its president, Tan Sri Yong Poh Kon said the FMM-MIER Business Conditions Survey First Half 2013 showed that the FMM-MIER business conditions index reach 108 pts in 1H13 (vs. 88.9 pts in 2H12 and 96.8 pts in 1H12).
              • The survey also showed that most current indicators performed better than in 2H12, especially production volume, local sales, and capacity utilization. 
              • He said that the FMM is of the view that the Trans Pacific Partnership (TPP) would open up new market opportunities and horizons for Malaysians to take advantage of the international  marketplace.
              • A successful TPP is top priority for Malaysian businesses as the sooner it is agreed upon and implemented, benefits can be realised earlier, he added. (Bernama)


              Malaysian companies should take advantage of the opportunities arising from the Ecuadorian government's huge expenditure especially in construction and mass transportation sectors. Other potential areas of cooperation include joint promotion of trade and investment, small-and-medium enterprises construction and engineering services, energy and biotechnology, said International Trade and Industry Minister Datuk Seri Mustapha Mohamed.
              • Bilateral trade between Malaysia and Ecuador grew more than 10-fold to RM220.72m in 2012 from RM30.64m recorded in 2011. 
              • For the 1Q13, total trade between Malaysia and Ecuador increased two-fold to reach US$33.35m against US$12.85m in 1Q12. (Bernama)


              The Malaysian Investment Development Authority (Mida) has attracted potential investment worth RM2.2bn during its recent mission to Manchester, Dublin, and Paris. The potential investments were in various sectors such as transportation equipment, information and communication technology, renewable energy, recycling industrial steel waste, maintenance, repair and overhaul activity and education or training, Mida said in a statement Wednesday. It said one particular project, namely the recycling of steel waste into zinc with a potential investment of RM200m, is expected to be concluded by Aug. (Bernama) 

              The World Investment Report 2013, by United Nations Conference on Trade and Development (Unctad), noted the Malaysian manufacturing sector is currently making a transition from labour-intensive investments into high-technology investments. "Malaysia's strategic policy measures are in line with Unctad's recommendations. In our view, Malaysia continues to be attractive to foreign investors," said International Trade and Industry Minister Datuk Seri Mustapa Mohamed.
              • According to the report, 2012 marks the first year where developing economies surpassed developed economies as FDI recipients. 
              • Global FDI inflows reached US$1.35tr (RM4.3tr) last year, with developing economies making up 52% of total investment inflow. 
              • Developed economies trailed at 42% with transition economies making up the remaining 6%. 
              • The UN think tank predicts a moderate rise in global FDI inflow for this year to US$1.45tr, US$1.6tr in 2014 and US$1.8tr in 2015. 
              • Singapore and Indonesia ranked ahead of Malaysia in terms of total inbound FDI within Asean. 
              • Malaysia's gross FDI inflows grew from US$33bn to US$33.2bn. The net FDI inflows dropped from US$12.2bn to US$10.1bn. (Financial Daily, Starbiz)


              Malaysia has fallen sharply to 25th position from 10th on AT Kearney's 2013 Foreign Direct Investment (FDI) Confidence Index from the previous year even as emerging market continue to attract FDI. The report, based on a survey of 300 senior executives of the world's leading corporations, showed that caution remains a major sentiment among investors even though they are more upbeat on the world's prospects than in previous years.
              • The survey found that while only 34% of respondents said the economy will recover this year or next, half said they are more optimistic than they were a year earlier. 
              • Most respondents now expect slow, steady growth across most of the world - with the notable exception of Europe - over the next three years. (Financial Daily)


              CIMB Global Economic News - 27 June 2013

              US corporate profits rose 4.7% yoy in 1Q13 from 4.0% in the earlier estimate (13.3% in 4Q12). (Bloomberg) 

              US real GDP grew 1.8% qoq in 1Q13 in the final estimate (2.4% in the second estimate), contrary to expectations of 2.4%. The downward revision to the percent change in real GDP primarily reflected downward revisions to personal consumption expenditures (primarily the services subcomponent), to exports, and to nonresidential fixed investment (mostly structures) that were partly offset by a downward revision to imports. (Bloomberg) 

              US MBA purchase applications index rose 2.0% wow in the 21 Jun week (-3.0% in the earlier week), whilst the refinance index dipped 5.0% wow (-3.0% in the prior week). (Bloomberg) 

              Global regulators pressed ahead with plans to limit overall bank borrowing and make it easier for investors to compare institutions, announcing that banks will have to calculate and disclose their “leverage ratios” according to a newly agreed global formula starting in 2015. (FT) 

              South Korea’s current account surplus widened to US$8.64 bn in May, from US$3.93 bn in Apr. (Bloomberg) 

              Thailand’s exports fell 5.3% yoy in May (+2.9% in Apr), according to customs data, while imports declined 2.1% (+8.9% in Apr). The trade deficit narrowed to US$2.3bn from US$4.1bn in Apr. (Bloomberg) 

              Finance Minister Kittiratt Na-Ranong has conceded that China's economic slowdown could have a negative impact on Thailand's economy, and is expecting at least three major economic agencies to revise down Thailand's forecasted growth this year. (The Nation) 

              Singapore’s manufacturing output beat market expectations to record a 2.1% yoy increase in May (5.0% in Apr), led mainly by growth in the biomedical manufacturing sector.

              Source: CIMB Daybreak - 27 June 2013

              CIMB Daybreak - 27 June 2013

              What’s on the Table...

              • Brewers - Time to sober up


              News of the Day...

              • UOA Development buys 11 acres land in Kuala Lumpur for RM130.3m
              • PKNS willing to sell stake in PJ Sentral to Nusa Gapurna at the right price?
              • Sime Darby deny that it was involved in the current forest fires in Indonesia
              • Exports of Malaysian palm oil products from June 1 to 25 rose 9.6% yoy
              • Share trading in Hong Leong Capital will be suspended from Aug 12
              • US real GDP grew 1.8% qoq in 1Q13


              Click here for the full PDF report 

              Wednesday, 26 June 2013

              Bernas working out plan to address shareholding spread

              Padiberas Nasional Bhd (Bernas) is working out a regularisation plan to address its shareholding spread. Chairman Datuk Wira Syed Abdul Jabbar Syed Hassan said the company had three months, following the close of the privatisation offer, to finalise the plan to deal with the public shareholding spread issue. “We couldn't get up to 90%, so we couldn't delist the company,” he told reporters after Bernas' AGM. (Starbiz)

              Inari Berhad Completes USD32.0 Million Acquisition of Opto-Electronics Manufacturer Amertron Inc (Global) Limited

              Inari Bhd has completed its acquisition of opto-electronics manufacturer Amertron Inc (Global) Ltd for RM102.8m. The acquisition included the takeover of Amertron's wholly-owned subsidiaries, Amertron Incorporated, which operates two manufacturing facilities in Clark Field and Paranaque, the Philippines, and Amertron Technology (Kunshan) Co Ltd which has a manufacturing facility in Kunshan, China.

              “The completion of the acquisition marks a significant milestone in Inari's growth and has an important impact on the group's future financial performance,” said group chief executive officer Lau Kean Cheong in a statement yesterday. The acquisition is expected to increase the group's profitability and more than double its combined annual turnover in FY14. (Starbiz)

              Travellers International defers planned IPO

              The Travellers International Hotel Group has deferred its RM2.7bn IPO to Sep-Oct after recent declines by local and global stock markets, IFR reported. The premarketing that started on June 13 was to end yesterday and given market conditions the company decided not to start bookbuilding, said IFR. Travellers is a JV between casino operator Genting Hong Kong Ltd and Philippine conglomerate, Alliance Global Group Inc. (Reuters)

              Faber to beef up non-concession operations

              Faber Group intends to grow its non-concession operation in the integrated facilities management (IFM) business sphere. MD Adnan Mohammad said the challenge would be to grow the non-concession business, which contributed about 10% to revenue last year, while the concession operations would remain the mainstay of Faber's business. “For us the over-reliance on concession is not good; that is why we need to strike a balance between concession and non-concession,” he said (StarBiz)

              Senheng expects sales to grow 16pc

              Senheng Electric (KL) is expecting a 16%t growth in sales this year to RM1.23bn, compared with RM1.1bn in 2012, due to the opening of additional outlets and higher demand from its consumer campaigns. The company, which distributes renowned electrical products through 133 outlets throughout Malaysia, plans to add six more this year, said its manager for the marketing and promotion division Seow Swee Miee. (Bernama, BT)

              Exports to drive New Hoong Fatt earnings growth

              New Hoong Fatt Holdings (NHFH) expects to maintain its earnings momentum this financial year, driven by growth opportunities in the export market. MD Chin Jit Sin said based on its results for the first quarter ended 31 Mar 13, the automotive parts manufacturer would be able to achieve similar numbers in financial year ended 2012. Catering to the replacement car parts market, NHFH reported that in 1Q13, its earnings rose 64.9% to RM6.75m from RM4.1m. (Starbiz)



              Scientex's Unit RM50m capex to boost blown film production capacity

              Great Wall Plastic Industries (GWPI), a wholly-owned subsidiary of Scientex has embarked on an expansion plan to boost the current blown film production capacity with the acquisition of new machinery for an estimated total investment cost of RM50m. Pursuant thereto, GWPI has entered into agreements with the machinery manufacturers to acquire new lines for the purposes of expanding its existing production capacity and businesses, including the acquisition of 5 blown film lines from Windmoeller & Hoelscher KG. (BMSB)



              Pelikan aims to penetrate Brazil, Peru, Chile and Ecuador

              Pelikan International Corp, which sees potential in the South American market, will tap further into the region to gain a stronger foothold and higher revenue. President/CEO Loo Hooi Keat said sales in Latin America grew 10% to 15% annually. “We aim at (penetrating) Brazil, Peru, Chile and Ecuador,” he said, adding that the company's brand was strong in Mexico, Columbia and Argentina which contributed some 12.3% to revenue last year compared with 9.5% in 2011. “Brazil and Argentina are under the same (trading) bloc, so being in Argentina allows us to move to Brazil, which is a big market,” Loo explained. (Starbiz)



              IHH to add 3,300 beds in 5 years, mulls re-entering Indonesia

              IHH Healthcare aims to grow its top line by "solid double digits" by end-31 Dec 13 as it plans to add 3,300 more beds in the next five and venture into new markets. "We are considering a re-entry into markets such as Indonesia," MD Dr Lim Cheok Peng said after the AGM. (StarBiz)



              Zelan has disposed of 3.6m ordinary shares in IJM

              Zelan has on 20 Jun 13 disposed of 3.6m ordinary shares in IJM Corporation in the open market and through direct business transaction off market deal at an average disposal price of RM5.69/share for a total consideration of RM20.4m. (BMSB)



              Prolintas preparing RM8bn war chest to build two new highways in the Peninsular

              Prolintas is preparing a RM8bn war chest to build two new highways in Peninsular Malaysia. Works on the infrastructure projects can take place within the next 12 months as Prolintas has already secured the concessions. The projects are the Damansara-Shah Alam Elevated Expressway (DASH) and the Sungai Besi-Ulu Klang Elevated Expressway (SUKE).

              Sources said Prolintas is working on the best financial model for the projects, addressing two core issues, namely the cost of compensation for businesses that may have to relocate before actual construction work begins, and the cost of construction materials, which has been volatile with a northward bias. (BT)



              Sona Petroleum has signed an underwriting agreement for its IPO

              Sona Petroleum, a special purpose acquisition company (SPAC), has signed an underwriting agreement for its IPO. The company hopes to raise RM550m. Bankers involved are CIMB Investment Bank, RHB Investment Bank, Kenanga Investment Bank and MIDF Amanah Investment Bank. The company's IPO involves a public issue of up to 1.1bn news shares of RM0.01 each. The shareholders will be given free detachable warrants of up to 1.1bn , with the conversion price expected at 35 sen each within five years. (BT)



              MAS to reinstate KL-Dubai route

              Malaysia Airlines will reinstate the KL-Dubai return service to its network, effective Aug 3, with daily flights using B777-200 aircraft. Dubai was one of the routes suspended during the airline's route rationalisation exercise in January last year. (Bernama)



              Proton's new car in first half of 2014

              Proton Holdings Bhd will launch a new compact car in the first half of next year, signifying the start of the national marque's next generation of vehicles. "The new compact car will be the starting point for a fresh range of cars by Proton," said its executive chairman Tan Sri Mohd Khamil Jamil. "In this regard, we are looking at all segments of the new car production, be it the A, B, C or D segments," he said. Mohd Khamil said Proton will have to rationalise its plant utilisation before announcing the production site of its new models. (BT)



              Petronas Carigali forms new unit to develop marginal oilfields

              Petronas Carigali Sdn Bhd, the oil and gas exploration unit of Petronas, has formed a new unit to focus on marginal oil fields, sources said. The move has puzzled players seeking to participate in the development of marginal oilfields. Sources said the new unit is called Vestigo, and it was formed to manage and develop risk service contracts (RSCs). “It seems like Petronas wants to develop some RSCs itself, so it will be keeping some of the marginal oilfields for Vestigo. It has hired an interim CEO as well,” said source.

              • The observer said bidding for the third round of RSCs would close this week, and there were some 10 fields up for grabs, with some of these fields having very small reserves less than 15m barrels of oil. Petronas has a total of 107 marginal oilfields. 
              • A source said the fields were mostly located in Peninsular Malaysia and Sarawak, where there were existing facilities and ongoing production activities. However, poor reserves amount may be discouraging some O&G service providers who have shown initial interest. (Starbiz)



              Mah Sing Group is on track to achieve this year's sales target of RM3bn

              Mah Sing Group is on track to achieve this year's sales target of RM3bn, says Group MD and CE Tan Sri Leong Hoy Kum. He said the group is optimistic of achieving the target judging from the RM750m sales recorded in the 1Q13.

              • "Our diversity of good projects in prime locations coupled with our range of properties to suit every need should sustain our growth, moving forward," he told reporters after the company's annual general meeting. 
              • He said for this year, the group has acquired four parcels of land with a combined gross development value (GDV) of RM7.78bn thus far. The four projects include integrated commercial centres like Damansara Sentral, Greater Kuala Lumpur, Lakeville Residence in Taman Wahyu, Kepong, Meridin@Senibong in Iskandar Malaysia and Kota Kinabalu Convention City in Sabah. (BT)


              Mah Sing: Demand still high for DIBS

              Mah Sing Group group MD Tan Sri Leong Hoy Kum said any measure by the central bank to curb developer interest-bearing schemes (DIBS) should take the current market condition into consideration. This follows reports in the local media that Bank Negara Malaysia was studying the risks arising from DIBS with a view to implementing measures to curb it.

              • "We can't comment too much now as there have not been any announcements, but generally the lending environment is still conducive and the interest rates are still low due to the competitive market," Leong said. He added that banks are selective in offering DIBS to developers and market demand is still high for the scheme. 
              • DIBS is a financing package launched a few years ago. It is a scheme where a property developer absorbs the home loan interest of the homebuyers during the construction period of a property. Mah Sing offers DIBS for some of its projects, depending on the market demand. The developer does not offer DIBS for its commercial and landed residential properties. (Financial Daily)

              Sime Darby, TNB to produce power from palm oil waste

              Sime Darby’s wholly-owned subsidiary, Sime Darby Plantation (SDP), has on 24 Jun 13, entered into a Shareholders’ Agreement with TNB Energy Services (TNBES), a wholly-owned subsidiary of Tenaga Nasional Berhad (TNB), whereby the parties have agreed to establish a joint venture (JV) and to incorporate a joint venture company to undertake biogas project development from agricultural waste product. The purpose of the Agreement is for SDP and TNBES to regulate their rights and obligations in the JV company. (BMSB)

              Manulife & ACE Insurance among bidders for stake in AMMB's life insurance division

              Insurers Manulife Financial Corp and ACE Insurance are among the shortlisted bidders for a majority stake in the life insurance division of AMMB Holdings Bhd, a deal that could be worth as much as US$600m, people with knowledge of the sale process said. According to Dow Jones, the sale is the latest in a string of transactions by foreign players looking for a piece of South-East Asia’s financial industry. (Starbiz)

              Bank Islam To Open 6th Kota Baharu Branch

              Bank Islam Malaysia Bhd (BIMB), a pioneer of Islamic banking in Malaysia, will open its sixth branch in the capital of Kelantan in Padang Garong in September. MD Datuk Seri Zukri Samat said BIMB currently has five branches in the capital of Kelantan. (BT)

              Perisai has allocated more than RM2.1bn for capex over the next three years

              Perisai Petroleum will leverage on the floating production storage and offloading vessel (FPSO) and drilling segments to drive growth, moving forward. The upstream oil and gas services provider will continue to provide offshore support vessels (OSV). “There are no current plans to sell it. We have OSV contracts running till August 2015,” MD Izzet Ishak said. The company has allocated more than RM2.1bn for capex over the next three years. “The precise plan for the next few years is to inject one major asset per year” he said. (Starbiz)

              SC accelerates awareness on PRS scheme

              The Securities Commission (SC) is working with the industry to accelerate the country's awareness of the Private Retirement Schemes (PRS), which is a voluntary nest-egg plan similar to the compulsory existing Employees Provident Fund (EPF). Speaking at the first annual PRS Conference today, Datuk Ranjit Singh, chairman of SC noted the importance of awareness of PRS across all sectors of the population.

              • "It is important to widen the accessibility of PRS to all members of the population and crucial for both providers and distributors to expand coverage across the nation, from the self-employed as well as the younger demographics," he said. 
              • Net asset value of PRS has reached RM100m with more than 30,000 accounts registered since the first PRS scheme was offered in Nov 12. (BT)

              Bank Negara to curb house financing scheme?

              Will Bank Negara follow in Singapore’s footsteps and ban the popular developer interest-bearing scheme (DIBS)? That is the question of the day for property industry players, after reports surfaced yesterday that Bank Negara is studying risks associated with DIBS and may be mulling curbing measures.

              • A banking source said Bank Negara has actually been looking into the matter since around 2009. However, Bank Negara has yet to respond to queries at press time. Should any curbs — or even an outright ban — arise from this development, Bank Negara is likely to focus on the banks and lending institutions. 
              • “Usually the developers have (some sort of) deal with the banks on DIBS and that’s why not all banks participate in the DIBS scheme. I guess that’s where Bank Negara’s power lies — they can (impose) control on the deals done between the developers and the banks,” said Khairul Anuar, a property lawyer.
              • “I don’t know where it came from (since) we have not heard,” said Michael Yam, REHDA president. “My first immediate response would be that I think Bank Negara should engage and consult with stakeholders to understand better how DIBS came about, its benefits and its pitfalls.” “If you use it in good faith, basically to ease the burden of homebuyers, in my opinion DIBS is a good product.” (KiniBiz)

              AirAsia Japan Terminates JV With ANA Holdings

              AirAsia Bhd has terminated its AirAsia Japan joint venture with ANA Holdings Inc, calling off the partnership with the Japanese airline due to differences in management. The joint venture had faced numerous challenges from its inception, stemming mainly from a fundamental difference of opinion on cost management and the base of the domestic operations.

              Earlier this month, the Malaysian low cost carrier (LCC) had hinted on the possibility of dissolving the joint venture. AirAsia group CEO Tan Sri Tony Fernandes had said: “I have great respect for ANA as the leading legacy airline in Japan but it is time for us to part ways and focus our attention on what we do best, which is running a true LCC.” (Starbiz)

              CIMB Political News - 26 June 2013

              In the Yang di-Pertuan Agong Tuanku Abdul Halim Mu'adzam Shah's opening address of the 13th Parliament yesterday, he reiterated his call for all parties to accept and respect the results of the recently concluded 13th General Election. He also reminded members of parliament not to resort to action that could lead to the destruction of the country as it would take a long time for the country to recover if it were to fall apart. (NST)

              Former PM Tun Dr Mahathir Mohamad is pushing for his son, Datuk Mukhriz Mahathir, to be among the new Umno VPs in the party elections and it may force out one of the incumbent VPs, Datuk Seri Ahmad Zahid Hamidi, said DAP strategist Liew Chin Tong. (Malay Mail, Malaysiakini)

              CIMB Malaysian Economic News - 26 June 2013

              In 2012, gross fixed capital formation (GFCF) posted a value of RM241.7bn (RM197.2bn in 2011), recording the highest performance since 2005. In real terms, GFCF posted a value of RM202bn (RM168bn in 2011).

              • For the year 2012, the expansion in GFCF was supported by the services (55.2% of GFCF), mining & quarrying (20.4%) and manufacturing (19.6%) activities. 
              • The share of GFCF increased markedly to 25.7% of GDP from 22.3% in 2011. 
              • By type of assets, performance of GFCF in 2012 was mainly spurred by the sturdy growth in the structure (46.9% of GFCF), ICT equipment and other machinery & equipment (27.1%) and transport equipment (13.5%). 
              • Private sector contributed 57.9% to GFCF in 2012 (57% in 2011) while that of public sector has marginally reduced to 42.1% in 2012 (43% in 2011). (Department of Statistics)

              The literacy rate among Malaysian citizens aged 10-64 years in 2010 increased to 97.3% (93.5% in 2000). Census 2010 recorded that the literacy rate in the urban area was higher at 98.3% compared to the rural area at 94.5%. The literacy rate also showed an increase for all states in 2010 compared to 2000.

              • The percentage of school attendance of Malaysian citizens aged six years and over showed a significant increase during the 2000-2010 period, which is from 91.3% to 93.5%. Census 2010 recorded 95.8% of the males and 91.1% of the females aged six years and over had attended school (vs. 94% and 88.5% respectively in 2000). 
              • The percentage of Malaysian citizens aged 20 years and over with higher education increased from 16% in 2000 to 21.6% in 2010. This trend was also observed for all main ethnic groups: Bumiputera (22.1% vs. 16.1% in 2000), Chinese (21.1% vs. 16.5% in 2000) and Indians (19.3% vs. 13% in 2000). 
              • Information pertaining to computer literacy was first collected during Census 2010. As a whole, computer literacy rate for Malaysian citizens aged 5-69 years reached more than 45% in every state. The computer literacy rates in the urban and rural areas were 68.6% and 42.1% respectively. (Department of Statistics)


              Labuan has received a whopping RM30m investment from a prominent Brunei investor for the construction of an international standard hotel and textile complex. It is the largest investment to date and is expected to enable the island to regain its glory from the 80s as the hub of fabric and branded clothes, said Labuan Corporation (LC) chairman Datuk Yussof Mahal. (Bernama)

              The net asset value of private retirement schemes (PRS) has reached RM100m with more than 30,000 accounts registered to date, said Securities Commission Malaysia Chairman Datuk Ranjit Ajit Singh. He said six months after the first PRS was launched at the end of last year, nine schemes with 33 retirement funds have been launched by seven PRS providers. (Bernama)

              CIMB Global Economic News - 26 June 2013

              US durable goods orders rose 3.6% mom in May from a revised 3.6% in Apr, outperforming consensus of 3.3%, whilst on a yoy basis, the measure gained 7.6% yoy from a revised 2.6% in Apr. (Bloomberg) 

              The US FHFA house price index gained 0.7% mom in Apr after improving a revised 1.5% in Mar, underperforming consensus of 1.2%. On a yoy basis, the gauge rose 7.4% from a revised 7.5% in Mar. (Bloomberg) 

              The US S&P/Case-Shiller 20-city home price index gained 1.7% mom in Apr from 1.9% in Mar, outpacing consensus of 1.5%. (Bloomberg) 

              US new-home sales rose to a seasonally adjusted annualised rate (SAAR) of 476,000 in May from a revised 466,000 in Apr, exceeding consensus of 460,000. (Bloomberg) 

              The US Conference Board consumer confidence index rose to 81.4 in Jun from a revised 74.3 in May, outpacing consensus of 75.0. (Bloomberg) 

              The European Central Bank is determined to maintain its current stance, and will not exit from the accommodative monetary policy in the near term, ECB President Mario Draghi said, as the overall economic outlook still warrants an accommodative stance with inflation low and unemployment high. (RTT News) 

              A plan by 11 European countries to tax financial transactions will be delayed by at least six months as participating governments have yet to agree on key aspects of the new levy, including its scope. (WSJ) 

              The People's Bank of China said it will use tools to safeguard stability in money markets and tight liquidity is set to ease, giving the first official signs of relief for a cash squeeze in the world's second-largest economy. (Bloomberg) 

              Japan's small business confidence improved in Jun to 49.6, the highest reading since Mar, from 48.2 in May. Confidence among manufacturers came in at 48.7, up from 47.2 a month ago. At the same time, non-manufacturers sentiment reached 50.4 compared to 49 in May. (RTT News) 

              South Korea's consumer confidence index improved to 105 in Jun from 104 in May. (Bloomberg) 

              Major emerging-market nations will work together to limit the effects that a strong US dollar could have on their economies as the United States Federal Reserve signals plans to scale back its massive stimulus programme, the Brazilian government said.
              • Brazilian President Dilma Rousseff and her Chinese counterpart, Xi Jinping, discussed ways to strengthen policy coordination yesterday, and Rousseff will contact other leaders of the BRICS group, which include Russia, India and South Africa, later this week to discuss concrete measures. (Reuters)


              Asia’s governments must eliminate corruption that could delay goods crossing its borders to get ahead as a globally preferred supply chain destination, according to World Trade Organisation director for information and external relations Keith Rockwell. (Malaysian Reserve) 

              Philippine imports rose 7.4% yoy in Apr (-8.4% in Mar), beating estimates of a 1.1% decline. The trade deficit widened to US$1.02bn from US$0.59bn in Mar. (Bloomberg) 

              Capital controls to stabilize the country’s financial markets are off the table despite the recent crash in local share prices and the depreciation of the peso, the Bangko Sentral ng Pilipinas (BSP) said.

              CIMB Daybreak - 26 June 2013

              What's on the Table...
              • Rubber Gloves - Closing time
              • AirAsia Bhd - Goodbye Japan
              • Alpha Edge - No signs yet of a turnaround


              News of the Day...
              • Perisai has allocated more than RM2.1bn for capex over the next three years
              • Manulife & ACE Insurance among bidders for stake in AMMBfs life insurance division
              • Mah Sing Group is on track to achieve this year's sales target of RM3bn
              • Sona Petroleum has signed an underwriting agreement for its IPO
              • Prolintas preparing RM8bn war chest to build two new highways in the Peninsular
              • US new-home sales rose to seasonally adjusted annualised rate of 476,000 in May


              Click here for the full PDF report 

              Tuesday, 25 June 2013

              Golden Plus delays report

              Golden Plus Holdings Bhd is delaying the release of its annual report for the financial year ended Dec 31, 2012 as the company is still preparing it and the outstanding financial statements for the financial years 2010 and 2011. The company said in a filing with Bursa Malaysia that it would be issuing and submitting the report within two months after the release of the outstanding financial statements. Golden Plus has been suspended from trading since Aug-2009. (Starbiz)

              Source: CIMB Daybreak - 25 June 2013

              Malaysian companies not at fault in open burning claim — Association

              Malaysian companies are not at fault in clearing land in Indonesia using fire, causing haze which has affected Singapore and parts of Malaysia, said Association of Plantation Investors of Malaysia in Indonesia (Apimi). Apimi executive secretary Nor Hazlan Abdul Mutalib said open burning in oil palm plantations owned by Malaysian companies was carried out by local smallholders in the land allocated to them. "Plantation owners have to set aside 20% of land to nurture smallholders in oil palm planting. It is a common practice for the smallholders to clear the land by fire," he added. (Bernama)

              Source: CIMB Daybreak - 25 June 2013

              Green Packett may consider selling stake in P1 to strategic investor

              Green Packet Bhd together with major shareholder C. C. Puan may be mulling a stake sale in wireless operator unit Packet One Networks (M) Sdn Bhd (P1) to a strategic investor, amongst other options on the table. Puan said that this, along with an initial public offering, merger and acquisition or collaboration, continued to be the options for P1. (Starbiz)

              Source: CIMB Daybreak - 25 June 2013

              Green Packet is preparing for its transition to long term evolution (LTE) network

              Green Packet is preparing for its transition to long term evolution (LTE) networks and is looking at a lower capex to accomplish the target. "Our capex for this year and next year is substantially lower than our previous estimate of RM200m because most of our software is upgradeable (for the transition to LTE)", group managing director and CEO CC Puan said. "To progress further, we plan to focus on two areas - operational excellence and financial performance. I think the focus for the Group right now is to continue to improve our financial figures year-on-year. We don't want to give any guidance on dividends because we want to focus on the major milestone." (Financial Daily)

              Source: CIMB Daybreak - 25 June 2013

              Privasia aims to double revenue from telecoms ops

              Privasia Technology Bhd aims to double its revenue contribution from the telecommunications sector by 2015. CEOPuvanesan Subenthiran said this will be supported by the company's plan to enhance its distributorship of telecommunications devices portfolio. In 2012, telecommunications sector contributed about 22%, or RM10m of the group's revenue. Puvanesan said Privasia recently signed an exclusive distributorship agreement with ZTE (Malaysia) Corporation to oversee the distribution and systems integration of its enterprise products in Malaysia and Singapore.

              Speaking at the group's annual general meeting yesterday, he said the distributorship deal is timely with the group's expansion plans. Privasia's business segments encompass outsourcing and consulting (OCD), E-Procurement (E-Proc), ICT distribution (CDIST), ICT services (CSERV) and satellite-based network services (SAT). (BT)

              Source: CIMB Daybreak - 25 June 2013

              New York-listed SunEdison to build solar power plants in Sepang

              US listed SunEdison Inc is bringing in some RM170m worth of investments into Malaysia with its solar power plants in Sepang. SunEdison has also signed a RM134m loan facility with Standard Chartered Malaysia to build its 10MW and 5MW solar power plant in the vicinity of the KL International Airport. The two solar power plants will be located on land belonging to Malaysia Airports Holdings Bhd. The construction has started and by next quarter, the will be feeding electricity into the national grid. Once both projects are operational, they are expected to supply 370m kwh of energy over 20 years. (Starbiz)

              Source: CIMB Daybreak - 25 June 2013

              Ariantec bags RM32.1mil broadband project in Riau

              Ariantec Global has been appointed by Indonesian-based internet service provider PT Pekanbaru Cybercity to construct and provide maintenance services for its high speed broadband network in Pekanbaru, Riau Indonesia. In conjunction with the US$10mil contract, Ariantec has also partnered with MDB Technologies to undertake the works. In a Bursa Malaysia statement, Ariantec said the project would be funded via internal funds and is expected to contribute to its 2013 and 2014 (Starbiz)

              Source: CIMB Daybreak - 25 June 2013

              Celcom to focus more on digital, m2m businesses

              Celcom Axiata will focus on digital services and machine-to-machine (M2M) businesses and less on voice and SMS services over the next five years, CFO Chari TVT said. Digital services include digital payment, digital advertising and digtial shopping with the spotlight on mobile content and value-added services on the Cube, Air Cash mobile remittance and money transfer services, he said. "We intend to go into partnership with other telcos we like to work with them and have a revenue-sharing model". (Financial Daily)

              Source: CIMB Daybreak - 25 June 2013
              Sona Petroleum Bhd, the latest special-purpose acquisition company (SPAC) to be approved for listing, is poised to hit a record-breaking RM550m in initial public offering (IPO) proceeds for a SPAC, having just inked an underwriting agreement with four local banks. Asked if the management was confident of hitting the ambitious fund-raising target, managing director Datuk Seri Hadian Hashim said: "Yes, the first two investors have given us that level of confidence. The response has been good."
              • Although Hadian declined to provide specifics on the investors, sources told StarBiz that two funds were close to investing in the SPAC, namely, Hong Kong-based hedge fund Segantii Capital and a unit of the Hong Leong group. 
              • He said that one of Sona's selling points was its management team, comprising experienced oil and gas (O&G) individuals. Hadian himself is a major shareholder in O&G upstream services provider Integrated Petroleum Services Sdn Bhd, an approved vendor to Petroliam Nasional Bhd. Chief financial officer Datuk Maznah Abdul Jalil is a well-known corporate figure, having been a key lieutenant of the late Tan Sri Yahaya Ahmad of DRB-Hicom. 
              • Another notable member of the management team is independent non-executive chairman Andreas Johannes Raymundus van Strijp, who has served 30 years in various Shell companies in Malaysia, the Netherlands, Norway, Brunei, Nigeria and the United Arab Emirates, mainly in Abu Dhabi and Dubai. (Starbiz)



              Source: CIMB Daybreak - 25 June 2013

              AirAsia X’s public retail offering of 150m shares oversubscribed by 3.83x

              AirAsia X Bhd’s public retail offering of 150m shares was oversubscribed by 3.83x. “A total of 38,975 applications for 575m issue shares were received from the Malaysian public for a total of 150m issue shares available under the public retail offering, representing a subscription rate of 3.83x,” said Malaysian Issuing House Sdn Bhd (MIH). The institutional price was fixed at RM1.25 per share on June 21, the final retail price was fixed at RM1.25 per share and the difference of 20 sen a share would be refunded to successful retail applicants within 10 market days from yesterday. (Starbiz)


              Source: CIMB Daybreak - 25 June 2013

              MRCB to undertake high-value projects

              MRCB will move into high-value construction with higher profit margins to drive the company forward, group COO Mohd Imran Mohamad Salim said. "We will focus on niche, specialised areas, such as environmental construction. These would involve rehabilitation projects and coastal rehabilitation works. There are not many competitors in these areas. In building construction, there are competitors everywhere and margins are going lower," he said.
              • He said MRCB will also diversify its property development activities to include niche projects and build more investment assets for higher recurring income. 
              • He said MRCB will launch a roadmap next year, which will set the company's business direction and new strategies. The plan is to have one-, three-, six- and 10-year roadmaps. (BT)


              Source: CIMB Daybreak - 25 June 2013

              FGVH to develop upstream/downstream activities in plantation sector in Cambodia

              Felda Global Ventures Holdings Bhd (FGVH) is planning to develop upstream and downstream activities in the plantation sector in Cambodia. Chief executive officer-designate Dr Emir Mavani Abdullah said that apart from marketing its products, including palm oil-based products in Cambodia, FGVH was also planning to set up rubber plantations in that country. (Starbiz)

              Source: CIMB Daybreak - 25 June 2013

              Datuk Abdul Ghani Othman appointed as Sime Darby’s new chairman

              Former Johor Menteri Besar Datuk Abdul Ghani Othman has been appointed as Sime Darby Bhd's new chairman effective July 1, taking over from interim chairman Tan Sri Samsudin Osman. The chairman's post was left vacant following the retirement of Tun Musa Hitam on Nov 8 last year. In a statement to Bursa Malaysia yesterday, Sime Darby said Abdul Ghani, 66, was also named Sime Darby's independent and non-executive director. (BT)

              Source: CIMB Daybreak - 25 June 2013

              Maybank interviews 5 candidates for CEO post

              Malayan Banking Bhd has so far interviewed five candidates for the post of chief executive officer (CEO), according to chairman Tan Sri Megat Zaharuddin Megat Mohd Nor. He said the interviews were ongoing and the results would be announced soon. Megat Zaharuddin said the potential candidates were from within Maybank and external sources with good track records in banking. (Starbiz)

              Source: CIMB Daybreak - 25 June 2013

              CIMB: RBS investment to break even by year-end

              CIMB Group Holdings Bhd expects its US$140m (RM451m) acquisition of the Royal Bank of Scotland plc’s Asian assets early 2012 to break even by year-end. When it first announced the RBS deal, the group had earlier estimated that by this year, some percentage of its earnings would come from the purchase but the full completion of the acquisition had taken longer than it expected. “We only completed it this month. All we want in 2013 from the RBS acquisition is it to break even,” said CIMB group chief executive Datuk Seri Nazir Razak. (BT)

              Source: CIMB Daybreak - 25 June 2013

              TNB & Sime Darby in JV to do biogas project development from palm oil mill effluent

              Tenaga Nasional Bhd has entered into a shareholder's agreement with Sime Darby Bhd to establish a JV undertaking biogas project development from palm oil mill effluent with the objective of selling the electricity generated to the national grid. This is in line with the national agenda to promote renewable energy to support the natural gas shortage and aging power plants. (BMSB)

              Source: CIMB Daybreak - 25 June 2013

              CIMB Political News - 25 June 2013

              An Indonesian minister has said Singapore and Malaysia should "know themselves" over the haze, accusing both of trying to discredit Indonesia over the issue. "Let me remind our friends from Malaysia, Singapore, don't just because of the haze tell stories to the world," said Energy and Mineral Resources Minister Jero Wacik. (Star) 

              32 Black 505 protesters, including three women, were detained by the police after they marched to Parliament House to hand over a memorandum to PM Datuk Seri Najib Tun Razak on alleged electoral irregularities. Scuffles erupted after the protesters tried to enter the Parliament compound, which was tightly guarded by policemen during the swearing-in ceremony of the newly-elected MPs yesterday. (Star)

              Source: CIMB Daybreak - 25 June 2013