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Author: MalaccaSecurities   |   Latest post: Fri, 7 May 2021, 10:13 AM


Mplus Market Pulse - 6 Apr 2021

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Market Review

Malaysia: The FBM KLCI (-0.1%) closed mildly lower after trading in a lacklustre manner with several regional peers remain shut on the Easter Monday break. The lower liners remained mixed, while the broader market ended mostly higher, led by the Construction sector (+2.2%) after the MRT 3 project will proceed in 2H21.

Global markets: The US stockmarkets resume trading in a buoyant manner as the Dow gained 1.1% amid the upbeat economic data from the labour market last week. European stockmarkets remained closed for the Easter Monday break, while Asia stockmarkets ended mixed.

The Day Ahead

The FBM KLCI struggled to sustain its gains during the first trading hour as the key index succumbed to profit taking led by gloves counters and selected banking heavyweights. On the broader market, we believe the MRT3 project, coupled with the reversion of ECRL to the original alignment may continue to serve as an upside catalyst for the construction sector. Meanwhile, the Covid-19 vaccination phase 2 programme is set to begin on 19th April 2021 in eight states. On the Brent crude oil, it has fallen 3.7% overnight.

Sector focus: Given the re-surfacing of MRT3 and ECRL projects in the media, we expect construction and property sectors to be under the limelight for the near term, not forgetting the proxy segment such as cement and steel industries. Also, buying interest may persist within the recovery-theme sector such as consumer amid lower Covid-19 cases and ongoing vaccination programme.

The FBM KLCI snapped its two-session gains and staged a mild pullback and still hovers below the 1,600 psychological level. Technical indicators remained mixed as the MACD Histogram has extended a green bar, while the RSI continued to hover below the 50 level. We reckon the key index may continue to trade sideways, with resistance pegged around 1,600-1,625; while support is located along 1,550-1,560.

Company Brief

Berjaya Corp Bhd chairman Tan Sri Vincent Tan Chee Yioun has relinquished his role as the company's executive chairman but will remain on the board of directors as non-executive chairman, effective yesterday. Meanwhile, Executive Deputy Chairman, Dato’ Sri Robin Tan will also step into a non-executive role on the board once the transformation process and plan have stabilised, in line with the elder Tan's vision of independent professional management. (The Star)

AMMB Holdings Bhd (AmBank) has confirmed that the issue price for its 300.0m private placement shares has been fixed at RM2.75 apiece. The issue price constitutes a 7.4% discount to its five-day volume-weighted average (VWAP) of its shares up to 2nd April 2021 of RM2.97. The group also confirmed that the private placement has been oversubscribed, having generated interest from a strong group of diverse investors. (The Edge)

Scientex Bhd is acquiring three pieces of freehold agriculture land in Penang for RM246.7m. The group wholly-owned subsidiaries Scientex Quatari Sdn Bhd and Scientex (Skudai) Sdn Bhd had entered into two sale and purchase agreements in relation to the proposed acquisition. The first agreement is to acquire a piece of freehold agricultural land at Seberang Perai Utara, measuring approximately 82.8- ha for RM147.1m. The second agreement is to acquire two pieces of freehold agricultural land at Seberang Perai Utara with an aggregate area of approximately 560,492-sqm for RM99.6m. (The Edge)

Ekovest Bhd is purchasing a total of 39-ha (96.3-ac) of freehold land in Pulai, Johor from Iskandar Waterfront Holdings Sdn Bhd (IWH) for RM944.6m. The related-party transaction acquisition comes after last month's aborted RM1.11bn deal between the two groups. (The Edge)

Datuk Haris Fadzilah Hassan will be stepping down as FGV Holdings Bhd’s group CEO effective 15th May 2021 to pursue other interests. FGV will be looking for a suitable candidate to be its CEO and an announcement will be made once such a candidate has been identified. (The Edge)

Top Glove Corp Bhd has been instructed by the US Customs and Border Protection (CBP) to carry out additional rectification and verification works in relation to its efforts addressing forced labour issues. One of the additional rectifications is to return workers' identity documents retained by recruitment agents that impacts less than 1% of its workers. Another rectification is relation to workers that are unable to come to Malaysia to work due to Covid-19-related lockdowns. (The Edge)

Greatech Technology Bhd has secured its first purchase order in the United States from a new electric vehicle customer for equipment to produce lithium-ion battery cells. The identity of the customer and the value of the purchase order, however, were not disclosed. (The Edge)

TDM Bhd’s TDM Plantation Sdn Bhd has received International Sustainability and Carbon Certification (ISCC) valid from 17th March 2021 until 16th March 2022. It is the first plantation company in Terengganu to receive such certification. The ISCC, approved by the European Commission, is accorded to the plantation division of TDM Bhd, following an independent technical review of its supply chain, operations and greenhouse gas calculations at the company’s South Zone operation units. (The Edge)

Star Media Group Bhd has decided to close its subscription video-on-demand service business Dimsum Entertainment by end-September 2021; a move that is seen to stop the group from bleeding losses. (The Edge)

Central Global Bhd plans to place out up to 20.0% of its issued shares to raise money to fund its construction project, manufacturing operations expansion, and working capital needs. The placement shares will be issued to qualified third-party investors to be identified at a later date. Based on its RM1.44 indicative price, the private placement is expected to raise gross proceeds of up to RM25.8m. (The Edge)

Dialog Group Bhd believes the Pengerang Deepwater Terminals (PDT) has the potential to attract more refining and petrochemical complex, as well as downstream petrochemical manufacturing plants to Johor. The group and its partners have invested more than RM13.50bn so far in the development of Phase 1, 2 and 3 of the 485.6-ha PDT. (The Edge)

Gabungan AQRS Bhd has seen the emergence of a new substantial shareholder in the form of Datuk Kamisah Johan. Kamisah had acquired 49.3m shares or a 9.1% stake after participating in its private placement on 1st April 2021. She is a selfmade entrepreneur and has more than a decade of experience in the property development sector. (The Edge)

Source: Mplus Research - 6 Apr 2021

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