• The FBMKLCI traded in a choppy manner yesterday as the key index swung between gains and losses before settling marginally lower. Much of the earlier gains fizzled out on profit taking among selected plantation and oil & gas heavyweights. Amidst the mixed market environment, however, the lower liners outperformed – the FBM Small Cap (+0.9%), FBM Fledging (+0.01%) and FBM Ace (+0.1%) all gained ground.
• Market breadth remained positive as gainers outdone losers on a ratio of 468- to-364 stocks. Traded volumes, meanwhile, improved by 2.3% to 1.62 bln shares.
• Topping the losers list on the big board was BAT (-44.0 sen), followed by MISC (-16.0 sen), Petronas Gas (-10.0 sen), Sime Darby (-6.0 sen) and Petronas Dagangan (-6.0 sen). Notable decliners on the broader market include Panasonic (-30.0 sen), Enra (-25.0 sen), GAB (-12.0 sen), Grand Hoover (-11.0 sen) and Vitrox (11.0 sen).
• Meanwhile, the significant advancers of the day on the broader market were Nestle (+56.0 sen), P.I.E Industrial (+26.0 sen), Top Glove (+22.0 sen) and Tien Wah (+21.0 sen). SKP Resources added 4.0 sen after reporting a strong set of quarterly earnings. Among the biggest gainers on the key index were Genting (+12.0 sen), Hong Leong Bank (+10.0 sen), KLK (+10.0 sen), PPB (+8.0 sen) and Maxis (+6.0 sen).
• ASEAN benchmark indices started the week off on a strong footing as the Nikkei gained 0.9% to claw its way back above the 16,000 psychological level. The Hang Seng Index added 0.9%, while the Shanghai Composite jumped 2.4% on the appointment of a new securities market regulator chief. ASEAN indices, meanwhile, closed mostly higher.
• U.S. stockmarkets rebounded from a two-day pullback as the Dow rose 1.4% to come off the technical bear market after U.S. oil rig count fell for the ninth straight week. The S&P 500 gained 1.5% as all ten main sectors advanced, with the energy sector (+2.5%) taking the lead.
• European benchmark equities also advanced – the FTSE (+1.5%), CAC (+1.8%) and DAX (+2.0%) all rose on the recovery in commodity prices. Meanwhile, the Eurozone’s Flash Purchasing Manager Index for February fell to 52.7, marking a 13-month low, implying for the need of further stimulus measures from the European Central Bank.

THE DAY AHEAD

• After two days of indifferent performance, we think stocks on Bursa Malaysia will head higher over the near term, taking cue from the positive performance of overseas equity markets. In particular, the jump in oil prices will buoy investor interest among oil and gas stocks listed on Bursa Malaysia, while the strengthening crude palm oil prices will be a boon for plantation stocks.
• On the upside, the immediate resistance is pegged at the 1,680 level, while the 1,700 points resistance level will ensue. Meanwhile, the key support level remains at the 1,650 level.
• The lower liners and broader market shares are also seeing renewed buying interest amid the calmer market conditions and we expect this trend to sustain over the near term as more retail players re-enter the market.

COMPANY BRIEFS

• Tiong Nam Logistics Holdings Bhd’s 3QFY16 net profit jumped 136.7% Y.o.Y to RM22.1 mln, largely contributed by its logistics and warehouse services as well as the property development segment. Revenue for the quarter gained 19.3% Y.o.Y to RM173.9 mln.
• For 9MFY16, cumulative net profit rose 15.4% Y.o.Y to RM43.1 mln. Revenue for the period added 4.6% Y.o.Y to RM446.7 mln. (The Edge Daily)
• Daibochi Plastic and Packaging Industry Bhd's 4Q2015 net profit grew 11.7% Y.o.Y to RM6.6 mln, attributed to improved margins from higher export sales after the Ringgit weakened against other currencies, new product innovations to the Australia and New Zealand (ANZ) markets, lower resin prices and favourable product mix. Revenue for the quarter, however, dropped 1.1% Y.o.Y to RM83.1 mln.
• For 9MFY16, cumulative net profit increased 12.6% Y.o.Y to RM26.7 mln. Revenue for the period was flat at RM345.0 mln. Daibochi declared a dividend of 1.3 sen per share, payable on 8th April 2016, bring the total dividend declared to 5.9 sen per share for 2015. (The Edge Daily)
• Luxchem Corp Bhd's 4Q2015 net profit jumped 135.6% Y.o.Y to RM14.8 mln, underpinned by higher contribution from the trading and manufacturing segment and the reversal of RM4.3 mln in employee benefit expense during the quarter. Revenue for the quarter improved 24.6% Y.o.Y to RM183.3 mln.
• For 2015, cumulative net profit improved 78.4% Y.o.Y to RM39.2 mln. Revenue for the year rose 13.7% Y.o.Y to RM686.0 mln. A single tier final dividend of 4.5 sen per share was proposed. (The Edge Daily)
• Construction piling specialist Pintaras
• Jaya Bhd's 2QFY16 net profit slumped 83.3% Y.o.Y to RM2.5 mln due to the low rate of project replenishment and cost overruns in the construction business. Revenue for the quarter slid 57.9% Y.o.Y to RM31.2 mln.
• For 1HFY16, cumulative net profit dipped 65.3% Y.o.Y to RM9.3 mln. Revenue for the period fell 51.6% Y.o.Y to RM67.0 mln. (The Edge Daily)
• DBE Gurney Resources Bhd is collaborating with seven Taiwanese companies in the secondary processing of chickens and marketing of its value-added chicken products via franchising.
• DBE Gurney has entered into the agreement to enhance its business activities by venturing into retailing of chicken products under "Harumi" brand. The company intends to open its first fast-food restaurant in Perak by mid-2016 and targets to have 30 restaurants, 3,000 kiosks and 300 mobile trucks in the next three years through franchising. (The Edge Daily)
• Alliance Financial Group Bhd's 3QFY16 net profit increased 7.3% Y.o.Y to RM135.6 mln on higher interest and non-interest income, coupled with lower bad loan allowance. Revenue for the quarter improved 3.2% Y.o.Y to RM361.2 mln.
• For 9MFY16, cumulative net profit declined 10.4% Y.o.Y to RM392.2 mln. Revenue for the period fell marginally by 0.4% Y.o.Y to RM1.07 bln. (The Edge Daily)
• Tien Wah Press Holdings Bhd's 4Q2015 net profit improved 14.1% Y.o.Y to RM11.8 mln, boosted by RM2.1 mln gain on disposal of 50.0% of Toyo (Viet) Paper Product Co. Ltd, sales rebate of RM3.9 mln in 2014 and improvement in operating margins, favourable foreign currency exchange rate and lower depreciation charge. Revenue for the quarter grew 11.9% Y.o.Y to RM97.1 mln.
• For 2015, cumulative net profit jumped 151.1% Y.o.Y to RM34.0 mln. Revenue for the year gained 3.9% Y.o.Y to RM367.4 mln. A final single tier dividend of 14.0 sen was proposed. (The Edge Daily)
• MPHB Capital Bhd's 4Q2015 net profit increased 43.3% Y.o.Y to RM29.0 mln due to financial asset gains and lower business expenses. Revenue for the quarter, however, declined 13.2% Y.o.Y to RM87.4 mln.
• For 2015, cumulative net profit sank 74.2% Y.o.Y to RM63.4 mln. Revenue for the year, however, added 2.9% Y.o.Y to RM380.8 mln. (The Edge Daily)
• UEM Sunrise Bhd's unit UEM Land Bhd is tying up with SUTL Marina Holdings Pte Ltd, a diversified Singapore-based group, to undertake several projects at Puteri Harbour, Iskandar Puteri in Johor.
• For the above purpose, UEM Land has entered into a joint venture (JV) agreement with SUTL Marina to establish a JV company with a 40:60 (UEML:SUTL) equity share to cooperate in incorporating, financing and operating a JV company in Malaysia.
• The JV company is tasked to develop the portion of the public marina that has yet to be developed, the private marina and the mega yacht marina and to operate the above facilities. (The Edge Daily)
• Sunway Bhd’s property division, Sunway Property is targeting to launch RM1.60 bln worth of properties in 2016, with launches spread across the Klang Valley, Johor, Ipoh and Penang.
• The group also aims to secure RM1.40 bln in property sales in 2016, following the group's achievement of RM1.20 bln sales in 2014. Meanwhile, its’ unbilled sales stood at RM2.3 bln as at 31st December 2015. The group currently has land bank of 3,304-ac., with potential GDV of RM47.7 bln over 15 years. (The Edge Daily)
• Amway (Malaysia) Holdings Bhd’s 4Q2015 net profit plunged 78.1% Y.o.Y to RM5.1 mln due to higher import costs as well as increased incentive provisions and operating expenses as a result of higher sales that climbed 16.7% Y.o.Y to RM268.3 mln during the period.
• For 2015, cumulative net profit decreased 36.0% Y.o.Y to RM63.9 mln. Revenue for the year, however, rose 19.2% Y.o.Y to RM1.02 bln. An interim dividend of 15 sen, comprising of a fourth interim dividend of 10.0 sen and a 5.0 sen special dividend payable on 24th March 2016, was declared. (The Edge Daily)
• Genting Plantations Bhd’s 4Q2015 net profit declined 56.9% Y.o.Y to RM59.4 mln, mainly due to the weakness in the property development segment. Revenue for the quarter dipped 26.7% Y.o.Y to RM424.4 mln.
• For 2015, cumulative net profit fell 49.7% Y.o.Y to RM189.8 mln. Revenue for the year decreased 16.3% Y.o.Y to RM1.38 bln. (The Star Online)
• Telekom Malaysia Bhd (TM) has entered into a strategic partnership with a video-on-demand (VOD) service provider Vuclip, a unit of Hong Kong-based PCCW Ltd. The partnership will see TM offering the service through its infrastructure and service will be called Viu in Malaysia and made available to UniFi and Streamyx broadband customers.
• It will provide Asian content including Korean, Bahasa Malaysia, Chinese, Tamil, Hindi, Indonesian and Bollywood to TM’s broadband subscribers. Vuclip already has long term partnerships with more than 250 top studios globally. (The Star Online)
• Despite the automotive industry’s volume sales virtually stagnating 2015, Malaysia’s largest Mercedes-Benz motor vehicle dealer, Cycle & Carriage Bintang Bhd’s (C&C Bintang) net profit soared 212.6% Y.o.Y to RM10.2 mln, on higher sales of hybrid models in 4Q2015. Revenue for the quarter increased 37.4% to RM387.6 mln.
• For 2015, cumulative net profit jumped 5.0x to RM52.1 mln. Revenue for the year rose 71.3% Y.o.Y to RM1.58 bln. The board is recommending a final dividend of 5.0 sen per share 2015. (The Star Online)
• Malaysian Resources Corp Bhd’s (MRCB) 4Q2015 net profit stood at RM26.8 mln vs. a net loss of RM5.3 mln, attributed to the completion of its 45-storey office tower, Q Sentral, as well as other ongoing development projects. Revenue for the quarter, however, declined 20.3% Y.o.Y to RM388.2 mln.
• For 2015, cumulative net profit jumped 116.5% Y.o.Y to RM330.4 mln. Revenue for the year climbed 12.0% Y.o.Y to RM1.70 bln. (The Star Online)
• Ta Ann Holdings Bhd’s 4Q2015 net profit jumped 168.3% Y.o.Y to RM58.0 mln, owing to the increase in production and sale of volume of fresh fruit bunches (FFB) and crude palm oil (CPO) as well as higher average selling prices of logs and plywood. Revenue for the quarter, however, fell marginally lower, by 0.2% Y.o.Y to RM268.8 mln.
• For 2015, cumulative net profit added 50.4% Y.o.Y to RM185.9 mln. Revenue for the year gained 3.5% Y.o.Y to RM1.05 bln. (The Star Online)

Source: M+ Online Research - 23 Feb 2016