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PublicInvest Research

Author: PublicInvest   |   Latest post: Wed, 27 Jan 2021, 11:10 AM

 

PublicInvest Research Headlines - 27 Jan 2021

Author: PublicInvest   |  Publish date: Wed, 27 Jan 2021, 11:10 AM


Economy

  • Global: IMF boosts world growth outlook as vaccines outweigh risks . The International Monetary Fund raised its forecast for global growth this year, betting the rollout of coronavirus vaccines and more fiscal stimulus will offset the immediate challenge posed by the resurgent pandemic. Global GDP will soar 5.5% this year, faster than the 5.2% projected in Oct, the fund said. It credited improvement in the US for much of the upgrade, which was offset by cuts to its predictions for the euro area and UK. Such an expansion would match 2007 as the best in four decades of data and follow an upwardly revised 3.5% contraction last year. (Bloomberg)
     
  • US: Consumer confidence improves on outlook for economy. US consumer confidence rose in Jan as Americans grew more upbeat about the outlook for the economy and job market in light of further fiscal aid and the distribution of coronavirus vaccines. The Conference Board’s index of sentiment increased to 89.3 from a revised 87.1 reading in Dec, according to a report. The median forecast in a Bloomberg survey of economists called for a reading of 89. The gauge of expectations rose to a three-month high of 92.5, while a measure of sentiment about current conditions decreased to 84.4, the worst reading since May. (Bloomberg)
     
  • UK: Retail sales gauge plunges to lowest since May – CBI . British retail sales have suffered their most widespread annual drop since May this month, according to a survey published which suggests that the latest lockdown is taking a heavy toll on many shops. The Confederation of British Industry’s retail sales balance, which asks retailers to compare sales with a year earlier, slumped to -50 in Jan from -3 in Dec, below all forecasts in a Reuters poll of economists. “With the lockdown likely to remain in place in the near-term, retailers expect this weakness to continue,” CBI economist Ben Jones said. (Reuters)
     
  • UK: Jobless rate highest since 2016 as second COVID-19 lockdown hits. Britain’s unemployment rate hit its highest in nearly five years in the three months to Nov, when coronavirus cases began to rise for a second time and most of the country returned to a partial lockdown. Redundancies touched a record high, taking the unemployment rate to 5.0%, its highest since mid-2016, according to official data, although the increase was slightly weaker than economists’ forecasts. There were some signs of a limited recovery in Dec, when lockdown measures eased, although a deterioration is likely in early 2021 as a tougher lockdown shut schools and closed most non-essential businesses to the public. (Reuters)
     
  • Hong Kong: Export growth fastest since 2018 . Hong Kong's exports grew at the fastest pace in over two years in Dec, survey data from the Census and Statistics Department showed. Exports rose 11.7% YoY in Dec, which was both the first double-digit growth and the fastest rate of increase since Oct 2018. In Nov, exports rose 5.6%. Exports climbed for a second straight month. Imports increased 14.1% YoY in Dec after a 5.1% rise in Nov. The growth was the fourth in a row and the fastest since Oct 2018. On a MoM basis, exports grew 3.3% and imports rose 8.1%. The visible trade deficit widened to HKD45.7bn from HKD25.6bn in Nov. (RTT)
     
  • Japan: Services producer prices fall for third month . Japan's services producer prices declined for the third straight month in Dec, data released by the Bank of Japan showed. The services producer price index fell 0.4% YoY in Dec, following a 0.5% drop in Nov. This was the third straight consecutive month of decline. On a monthly basis, services producer price inflation eased to 0.1% from 0.2% in the previous month. Excluding international transportation, services producer prices gained 0.1% annually after rising 0.2% in Nov. (RTT)
     
  • Singapore: Industrial production growth slows in Dec . Singapore's industrial production grew at a softer pace in Dec, data from the Economic Development Board showed. Industrial output rose 14.3% YoY in Dec, after an 18.7% growth in Nov. Production was forecast to increase 11.5%. Excluding biomedical manufacturing, industrial production grew 19.8% yearly in Dec, following a 14.0% increase in the preceding month. On a monthly basis, industrial production rose 2.4% in Dec, slower than 7.5% gain in the previous month. Economists had expected a 0.6% fall. (RTT)

Markets

  • Pharmaniaga: To supply 12m doses of CoronaVac to health ministry. Pharmaniaga will supply 12m doses of CoronaVac Covid-19 vaccine to the Ministry of Health, following the signing of an agreement by both parties. Pharmaniaga recently signed a deal with CoronaVac’s developer Sinovac Lifesciences Co Ltd of China to obtain the bulk supply of the vaccine which will be manufactured fill and finish at its high-tech plant. (SunBiz)
     
  • Duopharma: To procure, supply Russia’s Sputnik V Covid vaccine to health ministry. Duopharma Biotech will procure and supply the Covid-19 vaccine known as “Sputnik V” developed by Russia’s Gamaleya National Research Institute of Epidemiology and Microbiology to the Health Ministry. It has signed a term sheet agreement with the Russian Direct Investment Fund to secure 6.4m doses of Sputnik V. (SunBiz)
     
  • Advancecon: Bags fourth ECRL contract worth RM61m. Advancecon Holdings has won a RM60.6m contract to undertake subgrade works for Section 4 (Package 3) of the East Coast Rail Link (ECRL) infrastructure mega project. The contract would be for 25.5 months from March 2021 up to the projected completion in April 2023. This is the group's fourth ECRL contract, having been awarded two contracts in Sept 2020. (Business Times)
     
  • Gabungan AQRS: Bags two piling contracts worth RM84m. Gabungan AQRS has bagged two contracts for the provision of piling and infrastructure work worth a combined RM83.58m. It was awarded a RM45.7m job in a commercial building project by Teringin Sentral SB to be executed over 30 months. It has also accepted a RM37.88m contract from Solitaire Suites SB involving an office building project. (The Edge)
     
  • PNE PCB: Proposes to raise RM21.1m via private share placement. PNE PCB aims to raise an estimated RM21.13m via a proposed private placement of 71.16m new ordinary shares representing approximately 20% of its total issued shares to independent third parties to be identified later. The RM21.13 million is based on an illustrative issue price of 29.7sen or 10% discount to its last transacted price of 33 sen on 20 Jan. (SunBiz)
     
  • Boustead: Full take-up of One Cochrane Residences by 1H 2021. Boustead expects its One Cochrane Residences will be fully taken up by the first half of this year despite the setback of the Covid-19 pandemic in the property industry. The RM452m GDV development is approximately 70% completed and current take-up rate at 74%, of which 10% are foreign buyers. It has numerous pull factors that attracting buyers. (Business Times)
     
  • Hwa Tai: Rally hits speed bump, slapped by UMA query. Hwa Tai Industries has been slapped with an unusual market activity (UMA) query by the stock exchange, after its share price surged as much as 33.3% or 15.5sen to a three-year high of 62sen. Bursa Malaysia demanded an explanation of the reasons that could have possibly driven up its share price. (The Edge)
     
  • Tasco: Proposes one-to-four share split. Tasco has proposed a share split of every ordinary share to four shares. The proposed share split is to reward its existing shareholders, improve the liquidity of the company's shares and broaden its shareholder base. It is expected to be completed by the 1Q2021. RHB Investment Bank has been appointed as the principal adviser to Tasco for the proposed exercise. (The Edge)

Market Update

  • The FBM KLCI might open lower today, tracking US stocks which slipped from record levels on Tuesday, with investors cautious as the Federal Reserve kicked off its two-day policy meeting and US lawmakers continued to debate a new stimulus plan. Those concerns overshadowed impressive results from a slew of companies, including from General Electric and Johnson & Johnson, which had earlier pushed the S&P 500 to a record high. The Dow Jones Industrial Average fell 22.96 points, or 0.07%, to 30,937.04, the S&P 500 lost 5.74 points, or 0.15%, to 3,849.62 and the Nasdaq Composite dropped 9.93 points, or 0.07%, to 13,626.07. European stocks advanced, shrugging off political upheaval in Italy, as strong earnings from wealth manager UBS and auto parts maker Autoliv added to a string of upbeat corporate updates. The pan-European STOXX 600 index closed up 0.6%, with a rally in automakers, industrial companies and SAP helping the German DAX outperform.

Back home, the FBM KLCI erased earlier gains and ended the day on a flat note, as investors remained cautious amid the rising Covid-19 cases. The FBM KLCI closed 1.31 points or 0.083% lower at 1,575.31 after rising to a high of 1,609.19 earlier. In the region, Japan’s Nikkei 225 ended 0.96% lower at 28,546.18 points; South Korea’s Kospi closed 2.14% lower at 3,140.31 points; while Hong Kong’s Hang Seng finished 2.59% lower at 29,377.24 points.

Source: PublicInvest Research - 27 Jan 2021

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Poh Huat Resources Holdings Berhad - Malaysia Operations Closed Temporarily

Author: PublicInvest   |  Publish date: Wed, 27 Jan 2021, 11:07 AM


Poh Huat’s Malaysia operations in Bukit Pasir, Muar will be temporarily suspended from 25th January 2021 to 3rd February 2021, following a recent Covid-19 outbreak in its manufacturing base. A total of 543 employees were tested positive out of the c.1400 screened. While the temporary closure of the factory is expected to result in a delay in shipments, the management is currently in discussion with customers to reschedule its delivery dates. We do not think that the temporary closure will affect Poh Huat significantly, given that the group has certain amount of ready inventory and will be able to increase production with extended shifts upon re-commencement or diverting production to its Vietnam manufacturing base should the need arises. However, should the situation worsens and operations were to close for 2-4 weeks, we estimate Poh Huat’s earnings would fall by c.1.5-3%. Our Outperform call and TP of RM2.15 based on 10x CY21 EPS is maintained.

  • Voluntary PCR test. Following a voluntary Covid-19 PCR test on 21s January 2021, the screening exercise found 543 of the c.1400 employees (38.8%) screened to have tested positive for Covid-19. As such, Poh Huat has decided to temporarily suspend its operations from 25th January to 3rd Feb 2021, for a total of 10 days. The group is currently working closely with the Health Ministry and is currently preparing a temporary isolation centre for its staff. Meanwhile, Poh Huat’s Vietnam manufacturing base is free from Covid-19 related incidents.
     
  • Earnings impact. The temporary closure of Poh Huat Malaysia’s operating base is expected to result in delay in shipments to its US customers. We are of the view that the temporary closure of the production plant is unlikely to have any material impact on Poh Huat’s earnings, as the group has a certain amount of ready inventory to meet some of the orders and if needed, increase production with extended shifts when operation resumes. We understand that should the outbreak situation worsens, the group is able divert its production to its Vietnam manufacturing base as a last resort. We estimate that should the operations remained closed for 2-4 weeks, Poh Huat’s earnings will be impacted by c.1.5-3%. Note that Malaysia operations contributes c.45% of the group’s total revenue in FY20.

Source: PublicInvest Research - 27 Jan 2021

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Technical Buy - TURIYA (4359)

Author: PublicInvest   |  Publish date: Wed, 27 Jan 2021, 11:06 AM


  • Target Price: RM0.295, RM0.320
  • Last closing price: RM0.265
  • Potential return: 11.3%, 20.7%
  • Support: RM0.260
  • Stop Loss: RM0.235

Possible for chart pattern breakout. TURIYA is staging a potential breakout from its descending triangle chart pattern. Corresponding RSI and MACD indicators remain healthy while undergoing a short congestion phase, with anticipation of continuous improvement in both momentum and trend in the near term. Should immediate resistance level of RM0.295 be broken with renewed buying interest, it may continue to lift price higher to subsequent resistance level of RM0.320.

However, failure to hold on to support level of RM0.260 may indicate weakness in the share price and hence, a cut-loss signal.

Source: PublicInvest Research - 27 Jan 2021

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Technical Buy - PINEAPP (0006)

Author: PublicInvest   |  Publish date: Wed, 27 Jan 2021, 11:06 AM


  • Target Price: RM0.685, RM0.735
  • Last closing price: RM0.615
  • Potential return: 11.3%, 19.5%
  • Support: RM0.555
  • Stop Loss: RM0.495

Possible for further upside. PINEAPP is attempting to pick up from its prior uptrend. Corresponding RSI and MACD indicators remain healthy while undergoing a short congestion phase, with anticipation of continuous improvement in both momentum and trend in the near term. Should immediate resistance level of RM0.685 be broken with renewed buying interest, it may continue to lift price higher to subsequent resistance level of RM0.735.

However, failure to hold on to support level of RM0.555 may indicate weakness in the share price and hence, a cut-loss signal.

Source: PublicInvest Research - 27 Jan 2021

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Technical Buy - HWGB (9601)

Author: PublicInvest   |  Publish date: Tue, 26 Jan 2021, 12:09 PM


  • Target Price: RM0.680, RM0.710
  • Last closing price: RM0.635
  • Potential return: 7.0%, 11.8%
  • Support: RM0.600
  • Stop Loss: RM0.575

Possible for sideways breakout. HWGB is staging a potential breakout from its current sideways channel. Corresponding RSI and MACD indicators remain healthy while trending sideways, with anticipation of continuous improvement in both momentum and trend in the near term. Should immediate resistance level of RM0.680 be broken with renewed buying interest, it may continue to lift price higher to subsequent resistance level of RM0.710.

However, failure to hold on to support level of RM0.600 may indicate weakness in the share price and hence, a cut-loss signal.

Source: PublicInvest Research - 26 Jan 2021

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Technical Buy - RUBEREX (7803)

Author: PublicInvest   |  Publish date: Tue, 26 Jan 2021, 12:08 PM


  • Target Price: RM1.96, RM2.10
  • Last closing price: RM1.84
  • Potential return: 6.5%, 14.1%
  • Support: RM1.74
  • Stop Loss: RM1.63

Possible for chart pattern breakout. RUBEREX is staging a potential breakout from its pennant chart pattern. Corresponding RSI and MACD indicators remain healthy while undergoing congestion phase, with anticipation of continuous improvement in both momentum and trend in the near term. Should immediate resistance level of RM1.96 be broken with renewed buying interest, it may continue to lift price higher to subsequent resistance level of RM2.10.

However, failure to hold on to support level of RM1.74 may indicate weakness in the share price and hence, a cut-loss signal.

Source: PublicInvest Research - 26 Jan 2021

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IGB Reit - Prospects Derailed By MCO 2.0

Author: PublicInvest   |  Publish date: Tue, 26 Jan 2021, 12:06 PM


In 4QFY20, IGB Real Estate Investment Trusts’ (IGBREIT) realized net profit came in at RM72.1m (-4.2% YoY. -6.2% QoQ) which was largely within our expectations but above consensus. YTD, Group net profit of RM236.8m (-25.0% YoY) constituted 101% and 110% of our and consensus full year estimates. Going forward, management is still cautious as the second MCO (MCO 2.0) imposed on several states, including Kuala Lumpur and Selangor could continue to weigh on consumer sentiment in the near term with lower shopper footfall, lesser car traffic volume and higher temporary closure of retail shops. As such, earnings could see more downside risk due to the pandemic-related restrictions. We cut our FY21/22 earnings by -8%/-6% respectively after imputing the impact from MCO 2.0. We remain cautious and maintain our Neutral call and RM1.72 TP.

  • 4QFY20 revenue rose 5.7% YoY to RM147.5m primarily due to the reversal of over-provision for rental support. However, net property income dropped 3.1% YoY to RM93.1m and correspondingly, profit after taxation was lower by 4.2% YoY to RM72.1m due to the higher allowance for impairment of trade receivables. The distributable income for the current quarter amounted to RM78.1m, consisting of realised profit of RM72.1m and the non-cash adjustments arising mainly from manager fee payable in units of RM5.6 m.

For the year, Group gross revenue was RM465.2m, declining 15.7% YoY while net property income was 20.6% lower YoY at RM316.7m which yielded profit after tax of RM236.8m (or -25% YoY) which was dragged mainly due to the rental support provided to tenants, lower car park income and higher allowance for impairment of trade receivables arising from the Covid-19 pandemic and resultant MCOs. Fair value for investment properties remained unchanged in FY20 despite the earlier fear of impairments due to pandemicdriven lockdowns.

Source: PublicInvest Research - 26 Jan 2021

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Hartalega Holdings Berhad - Breaking Its Own Records

Author: PublicInvest   |  Publish date: Tue, 26 Jan 2021, 12:05 PM


Hartalega’s 9MFY21 net profit jumped 453.4% YoY to RM1.77bn, on the back of stronger ASP and higher sales volume. The results were below both our and consensus estimates at 66% and 69% respectively. Despite the shortfall, we still deem the results within our projections considering that the Group is expected to continue delivering strong earnings, supported by yet another QoQ ASP increase. We reiterate our Outperform call on Hartalega, with an unchanged TP of RM24.50. Downside risks to our call include possible derating should ASP increase tapers off sooner than expected. On a side note, Hartalega has also announced an interim dividend of 9.65sen per share.

  • Continues to impress. Hartalega’s 3QFY21 revenue was up by 167% YoY, to RM2.13bn. The strong jump in revenue was fueled by the increase in both ASP (+138% YoY) and sales volume (+12% YoY), on a YoY basis. We note that utilization rate for 3QFY21 was slightly lower at 95%, as opposed to 98% in 2QFY20, despite the booming demand for rubber gloves globally. We attribute the marginally lower utilization rate to the fact that Hartalega had to temporarily shut down some of its production lines in December, after 35 workers tested positive for Covid-19. Despite that, margins have continued to improve, with PAT margin expanding by 31.8ppts to 47%. As a result, Hartalega’s net profit also leaped by 725.9% YoY to RM1bn.
     
  • Expansion plans. All 12 lines in Plant 6 (+4.7bn pcs pa) have been fully commissioned in October, while Plant 7 (+3.4bn pcs pa) has commissioned 4 out of 10 lines to date, with another 2 more lines expected to come on stream in March. The remaining 4 lines in Plant 7, allocated for surgical gloves, are expected to be progressively commissioned in the coming quarters. Plant 8 will likely commission its first line in 4QCY21, while NGC 2.0 is targeted to be operational in CY22. The annual installed capacity is expected to reach 44bn pcs pa by FY22.
     
  • Not stopping just yet. Despite the gradual rollout of viable Covid-19 vaccines, we believe that the demand for gloves is still robust, as Hartalega is expecting to further raise its ASP by another 40-50% in 4QFY21. We opine that it is fairly unlikely to inoculate a sufficient percentage of the population to reach herd immunity, given the limited vaccine supplies. With that, we believe that the demand for rubber gloves should be able to sustain in the short to medium term.

Source: PublicInvest Research - 26 Jan 2021

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Inari Amertron Berhad - Key Beneficiary of 5G Rollout

Author: PublicInvest   |  Publish date: Tue, 26 Jan 2021, 12:03 PM


After two consecutive years of earnings decline, Inari is poised for a strong comeback in FY21, as we expect it to benefit from the deployment of 5G wireless technology with more RF contents to be included in 5G devices. Inari has recently increased its number of SiP lines to 22, from the initial 8 lines, in order to cater for the strong volume loading. Its new JV with PCL Technologies also serves as another prong of growth to the Group, underpinned by the adoption of 400G Ethernet ports. With that being said, we forecast a CAGR of 32.1% on Inari’s FY20-23F earnings. We initiate Inari with an Outperform call, with a TP of RM3.80. We derive our TP based on a PE multiple of 42x, which is c.15% premium to its local peers’ average. We deem the premium multiple justifiable, given its multiple prong growth strategy that will support the Group’s near to medium term outlook.

  • Closest proxy to 5G. We believe Inari will greatly benefit from the transition to the emerging 5G technology, given that the wireless technology evolution will result in higher number of frequency bands supported by 5G devices, which in turn, increases the need for more RF filters to be fitted. Inari provides assembly and testing services to its longtime customer, Broadcom for the latter’s premium FBAR filters. We highlight that Inari has installed a total of 22 SiP lines currently, from 8 lines initially. Its RF segment is expected to flourish, considering the overwhelming demand for the US-based smartphone maker’s latest 5G model. We opine that the wireless component supply agreement signed between Broadcom and the US phone smartphone maker also helps to provide clarity to Inari in the short to medium term.
     
  • New JV to start bearing fruit. Inari’s 30%-owned JV with the Taiwanbased PCL Technologies will be focused on producing optical transceivers with transfer speeds up to 400Gbps, which is 4x the speed of current optical transceivers used in data centers. The growth of the optical transceiver market will be underpinned by the adoption of 400G Ethernet ports as well as data center growth. The new venture has made its first shipment in June 2020 and we also expect to see positive contribution from this JV to the Group in FY21.
     
  • Valuation. We initiate coverage on Inari with an Outperform call, ascribing a PE multiple of 42x on its CY21F EPS of 9.1sen per share. The 42x multiple implies c.15% premium to local peers’ average. We deem the premium justifiable, considering (i) its strong 3-year earnings CAGR of 32.1%, (ii) closest proxy for 5G growth, and (iii) its exposure to the growing optical transceiver space.

Source: PublicInvest Research - 26 Jan 2021

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PublicInvest Research Headlines - 26 Jan 2021

Author: PublicInvest   |  Publish date: Tue, 26 Jan 2021, 12:02 PM


Economy

  • EU: German business morale drops to six-month low on virus woes. German business morale slumped to a six-month low in Jan as a second wave of COVID-19 has brought to a halt a recovery in Europe's largest economy, a survey showed. The Ifo institute said its business climate index fell to 90.1 from an upwardly revised reading of 92.2 in Dec. A Reuters poll had pointed to a Jan reading of 91.8. "The second Corona wave has temporarily ended the recovery of the German economy," Ifo President Clemens Fuest said in a statement. Unprecedented government rescue and stimulus measures helped lessen the shock of the pandemic in Germany last year, when the economy shrank by 5.0%, less than expected and a smaller contraction than during the global financial crisis. However, Chancellor Angela Merkel and state leaders agreed last week to extend a lockdown until mid-February as Germany, once seen as a role model for fighting the pandemic, struggles with a second wave of infections. (Reuters)
     
  • EU: Italian deficit may reach 9.2% this year as COVID costs pile up. The Italian Treasury is starting to factor in a bigger hit to the country’s battered public finances this year as another extended lockdown holds back the recovery, a senior government official said. Treasury models suggest the budget deficit may reach as much as 9.2% of output this year, the official said. The government is also looking at a deteriorating outlook for growth and could see the economy expand as little as 4.5% in its worst-case scenario, according to the official. The government recently said the deficit would run to 8.8% and, in Oct, forecast growth of 6% for this year, banking on European Union recovery funds to help activity rebound after a hammering in 2020. (Bloomberg)
     
  • China: China was largest recipient of FDI in 2020 - Report. China was the largest recipient of foreign direct investment in 2020 as the coronavirus outbreak spread across the world during the course of the year, with the Chinese economy having brought in USD163bn in inflows. China’s USD163bn in inflows last year, compared to USD134bn attracted by the US, the United Nations Conference on Trade and Development (UNCTAD) said in a report released. In 2019, the US had received USD251bn in inflows and China received USD140bn. China’s economy picked up speed in the 4Q, with growth beating expectations as it ended a rough coronavirus-striken 2020 in remarkably good shape and remained poised to expand further this year even as the global pandemic rages unabated. (Reuters)
     
  • Singapore: Consumer prices steady in Dec. Singapore's consumer prices remained stable in Dec, data from the Monetary Authority of Singapore and the Ministry of Trade and Industry showed. The consumer price index remained unchanged YoY in Dec, after a 0.1% decline in Nov. Economists had expected a 0.1% fall. This latest consumer prices outcome was largely due to a rise in prices for private transportation cost. MAS core CPI, which excludes the costs of accommodation and private road transport, fell 0.3% annually in Dec, following a 0.1% decrease in the preceding month. Economists had expected a 0.1% fall. In 2020, both MAS core CPI and consumer prices declined 0.2% from a year ago. The statistical office expects external inflation to rise in the coming quarters, amid a recovery in global oil prices. (RTT)
     
  • Taiwan: Industrial production increases in Dec. Taiwan's industrial production grew at a faster pace in Dec, data from the Ministry of Economic Affairs showed. Industrial output grew 9.9% YoY in Dec, following a 7.56% increase in Nov. Manufacturing output gained 10.41% yearly in Dec and mining and quarrying production accelerated 13.48%. Electricity and gas supply gained 4.39% and water supply output rose 0.68%. On a monthly basis, industrial production rose 1.93% in Dec, following a 1.07% growth in the prior month. Another report from the ministry showed that retail sales increased 1.4% annually in Dec, slower than 2.63% increase in Nov. Wholesale trade grew 12.5% yearly in December. (RTT)
     
  • Australia: Trade surplus increases on exports. Australia's trade surplus increased in Dec as exports logged a monthly growth amid falling imports, preliminary estimates from the Australian Bureau of Statistics showed. The trade surplus increased to AUD8.96bn from AUD1.53bn in Nov. Exports increased 16% on month to AUD34.93bn, while imports dropped 9% to AUD25.97bn. Top export destinations were China, Japan, US, India and South Korea. Exports to China grew 21% and that to Japan gained 24%. Shipments to US surged 58%. YoY, exports gained 3% and imports remained flat in Dec. For the calendar year 2020, exports were 7% lower overall than 2019 and imports decreased 5% from last year. (RTT)
     
  • Indonesia: FDI picks up in 4Q, but down in 2020 due to virus impact. Foreign direct investment (FDI) into Indonesia in the 4Q last year rose 5.5% to IDR111.1trn (USD7.92bn), despite a slowdown earlier in the year, data from the country's investment board showed. For the whole of 2020, there was IDR412.8trn (USD29.44bn) of FDI into Southeast Asia's largest economy, down 2.4% from 2019, as companies put a hold on some investment plans due to the coronavirus pandemic. The annual growth in the Oct-Dec investment picked up from the 1.1% increase in the previous quarter, the Investment Coordinating Board (BKPM) data showed. (Reuters)
     
  • South Korea: Growth beats estimates amid export recovery. South Korea’s economy grew more than expected last quarter as a recovery in exports helped offset the hit to activity from a winter coronavirus outbreak. GDP increased 1.1% in the three months through Dec from the prior quarter, the Bank of Korea reported Tuesday. Economists had projected a 0.9% expansion. While growth slowed sharply from the summer, strong exports and Korea’s success in managing the virus without resorting to heavy restrictions on activity drove an expansion that left Korea in better shape than most developed countries. (Bloomberg)

Markets

  • DneX: Awarded Indonesian submarine cable maintenance deal. Dagang NeXchange (DneX), through a consortium formed between business unit PT DNeX Telco Indonesia and PT Samudera Mbiantu Sesami, has signed a consortium agreement with PT Infrastruktur Telekomunikasi Indonesia for the deployment, management, maintenance and repair as well as other value added works for the Maintenance Support Sistem Komunikasi Kabel Laut within and outside of Indonesia. (SunBiz)
     
  • KNM: Italian unit wins RM30.22m in contracts with O&G firm. KNM’s Italian unit has clinched RM30.22m in contracts for a plant in the US. The process equipment manufacturer’s unit FBM Hudon Italiana SpA, which manufacturers process equipment such as condensers, spheres and process tanks, inked two agreements with Dutch oil and gas (O&G) firm Stamicarbon BV to supply a high-pressure carbanate condenser and a highpressure stripper. The contracts are expected to contribute to earnings for the FY21 and FY22. (The Edge)
     
  • Sunsuria: Sells land in Setapak to Kerjaya Prospek Property. Sunsuria is disposing of two parcels of agricultural land in Kuala Lumpur to Kerjaya Prospek Property for a total of RM30.14m. It had entered into a sale and purchase agreement to dispose of the two vacant freehold agricultural lands located in Setapak measuring a total of 9,092 square metres. The disposal of properties will enable Sunsuria to unlock capital resources from being tied up as long-term assets and realise the value of the properties at a fair market value. (The Edge)
     
  • NWP Holdings: Ventures into motorcycles purchase programme for Grab Food rider. NWP Holdings (NHB) is venturing into a special motorbike purchase programme targeted at existing Grab Food riders. The tailormade program is exclusively for Grab riders aand this includes competitive pricing as well as zero down payment for motorbike purchase if applicants meet stipulated conditions. The motorbike programmes offer very competitive pricing. It also offer zero down payment for the motorbikes if certain criteria are met. (Business Times)
     
  • Key ASIC: Bags RM21.22m contract. Key ASIC has entered into a contract worth USD5.25m (approximately RM21.22m) with Canvas Technology Pte Ltd. The project entails the technology and design internet protocol (IP) development and licensing. The contract is expected to contribute positively to the net assets per share and earnings per share of Key ASIC and its subsidiaries for the financial years ending May 31, 2021 and May 31, 2022. (The Edge)
     
  • Bintai Kinden: Teams up with Australian to develop Holistica Melaka and Holistica Penang. Bintai Kinden Corp is teaming up with Australia’s International Equities Corp Ltd to jointly undertake two mixed property development and management projects with healthcare facilities and wellness services in Malacca and Penang. Both will form a management company to undertake the management, marketing activities under the Seasons brand name, promotion and operation of the mixed property development and management projects. (SunBiz)
     
  • Bioalpha: To procure, disctribute Sinovac’s Covid-19 vaccine in Malaysia. Bioalpha Holdings has entered into a procurement and distribution agreement with Shanghai Bukun Trading Co Ltd (SBTC) for the procurement and distribution of vaccines in Malaysia, including but not limited to the Covid-19 vaccine developed by Sinovac Biotech Co Ltd, subject to relevant authorities’ approvals. (SunBiz)
     
  • Paragon: Gets takeover offer from AKK at steep discount. Paragon Union has received a notice of unconditional mandatory takeover offer from AKK Capital SB to buy all the remaining shares in the company at 55sen each. This follows the share sale agreements between AKK and five vendors on Jan 22 this year to acquire a total of 39.98m shares, or equivalent to a 60.41% Paragon stake. The offer price represented a 47.6% or 50sen discount to its closing share price of RM1.05 on Jan 21 2021. (Business Times)
     
  • Censof: To raise RM25m for working capital and to buy additional stake in subsidiary. Censof Holdings has proposed a private placement to raise up to RM25.09m, partly to fund the acquisition of an additional stake in a subsidiary. It was placing out up to 100.35m new shares or 20% of its shareholding to third party investors. The indicative issue price of the placement shares is 25sen. It will be using RM14.06m of the proceeds to acquire an additional 30.87% in its 58.20%-owned subsidiary Asian Business Software Solutions Pte Ltd. (The Edge)
     
  • AwanTec: Seeks up to RM922m in damages after govt unilaterally terminated SKIN contract. Prestariang SKIN SB, a unit of AwanBiru Technology (AwanTec) which was formerly known as Prestariang, is entitled to damages of between RM733m and RM922m after the Pakatan Harapan government terminated a concession agreement for the provision of a comprehensive immigration system over 15 years with the company, said its lawyer. (The Edge)
     
  • Spritzer: Pledges to bring fresh water to flood victims. Spritzer has joined in the effort to bring aid to victims in the floodhit areas nationwide by distributing potable water. Spritzer has since 7 Jan 2021 distributed aid in the form of potable water to those affected in the east coast and southern states of Pahang, Johor, Kelantan and Terengganu. To-date, more than 25,000 bottles of potable water has been dispensed with more on the way for this continuous effort. (SunBiz)
     
  • MMC Corp: PTP records 8% growth after registering 9.8m TEUs throughput in 2020. Port of Tanjung Pelepas (PTP) registered a strong terminal growth after hitting 9.8m TEUs total throughput, the highest in 2020, despite global economic uncertainties and health pandemic. The record represents an increase of more than 8% growth at the back of 9.1m TEUs recorded in 2019. PTP is a JV between Malaysia's MMC Group and the Hague-based APM Terminals. (Business Times)
     
  • Ge-Shen: Subsidiary in Johor Bahru confirms 10 employees tested positive for Covid-19. Ge-Shen Corp announced that 10 employees in its 70%-owned subsidiary Demand Options SB have been tested Covid-19 positive. The infected 10 employees work at Demand Option’s primary operations in Desa Cemerlang, Johor Bahru. Mass testing has been conducted after the first case of Covid-19 was identified in Demand Options. The management has informed the Ministry of Health and is awaiting further directives from the MoH. (The Edge)

MARKET UPDATE

  • The FBM KLCI might open with a cautious note today after major US averages on Monday closed well off their best levels of the day, which included a Nasdaq record, as concerns over the timing and size of fiscal stimulus dented optimism at the start of a week of earning reports from mega-cap companies. Officials in President Joe Biden’s administration are trying to head off Republican concerns that his USD1.9trn pandemic relief proposal is too expensive. At the closing bell, the Dow Jones Industrial Average fell 0.12%, the S&P 500 gained 0.36% and the Nasdaq Composite added 0.69%. After climbing as much as 1.4% to an intraday record, the Nasdaq gave back a good portion of its gains, with the so-called “stay-at-home” winners, including Microsoft Corp, Facebook and Apple, rising after upbeat results from Netflix last week. The pan-European STOXX 600 index reversed early gains and finished 0.8% lower. The German DAX fell 1.7%, France CAC 40 was down 1.6% and the UK’s FTSE 100 declined 0.8%.

Back home, the FBM KLCI fell as market sentiment was dampened by fears that the rising number of Covid-19 cases could lead to a more stringent lockdown. The benchmark index closed 20.12 points or 1.26% lower at 1,576.62. In the region, Japan’s Nikkei 225 closed 0.67% higher at 28,822.29, South Korea’s Kospi ended 2.18% higher at 3,208.99, and Hong Kong’s Hang Seng finished 2.41% higher at 30,159.01.

Source: PublicInvest Research - 26 Jan 2021

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wehcant MMC Corp: PTP records 8% growth...How come price no up???
27/01/2021 4:45 PM


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