Market Review

Malaysia:. The FBM KLCI (+0.2%) rebounded, lifted by gains in selected plantation and banking heavyweights as the key index extended its weekly gains, rising 0.9% WoW. The lower liners also marched higher, while the industrial products & services sector (-0.3%) was the sole underperformer on the broader market.

Global markets:. The US rebounded from the recent pullback as the Dow added 0.7% on a broad base recovery as bargain hunting activities take shape. European stockmarkets closed mostly higher, while Asia stockmarkets continues to remain mostly downbeat.

The Day Ahead

The FBM KLCI found itself on firmer footing above the 1,500 level over past week and finished the week with modest gains, driven by investors’ optimism over further relaxed SOPs in Phase 1 states. Also, we believe the stability on the political scene following the appointment of the new Prime Minister may give rise to positive sentiment, but risks remain with the elevated Covid-19 cases in Malaysia. Meanwhile, investors are eyeing Malaysia’s inflation rate which will be released on Wednesday. Commodities wise, CPO is trading below the all-time-high zone, while Brent crude oil is trading below USD66 zone.

Sector focus:. Investors may pick up stocks in the technology sectors following the jump in Nasdaq on Friday. Besides, focus may remain on the recovery theme sectors such as construction, property, transportation & logistics and consumer related.

The FBM KLCI finished marginally higher, hovering above the daily EMA9 level. Technical indicators remained mixed as the MACD Histogram has extended a red bar, while the RSI hovered above the 50 level. With the key index hovering firmer above the 1,500 level, investors may expect a further upside towards next resistance located around 1,540, while the support level is set around 1,480.

Company Brief

Malakoff Corp Bhd’s 2QFY21 net profit grew 12.1% YoY to RM117.7m, as higher coal prices boosted income from its energy business, as well as higher contributions from Alam Flora Sdn Bhd and overseas associates. Revenue for the quarter rose 5.2% YoY to RM1.58bn. An interim dividend payout of 3.1 sen a share, payable on 20th October 2021 was declared. (The Star)

Pharmaniaga Bhd’s 2QFY21 net profit expanded 37.3% YoY to RM13.7m, on the sale of Sinovac Covid-19 vaccines to the government, which more than offset weaker contributions from the group's logistics and distribution division, as well as its Indonesia division. Revenue for the quarter improved 82.3% YoY to RM1.18bn. (The Star)

Malayan Flour Mills Bhd’s 2QFY21 net profit stood at RM128.3m vs. a net loss of RM4.5m recorded in the previous corresponding quarter, on the back of a one-off gain amounting to RM126.2m from the disposal of equity in DTSB Group. Revenue for the quarter rose 9.6% YoY to RM576.2m. (The Star)

Hubline Bhd and MISC Maritime Services Sdn Bhd inked a Memorandum of Understanding to explore a potential collaboration in the port and terminal management and operations space, as well as related marine services segment in Sarawak. (The Edge)

Carlsberg Brewery (M) Bhd’s 2QFY21 net profit surged 248.7% YoY to RM37.1m, as both Malaysia and Singapore operations saw better overall sales compared with the same quarter last year. Revenue for the quarter gained 21.6% YoY to RM349.2m. (The Edge)

Advancecon Holdings Bhd’s indirect wholly-owned unit LSS TPG Sdn Bhd has signed a 21-year power purchase agreement with Tenaga Nasional Bhd to design, construct, own, operate and maintain a solar photovoltaic energy-generating facility with a capacity of 26.0-MW of alternating current in Kuala Langat, Selangor. (The Edge)

Country Heights Holdings Bhd plans to undertake a private placement of up to 54.7m new shares that represents 20.0% of the company’s existing number of issued shares to raise an indicative RM58.8m. The sum raised will be used to partially finance the construction cost of the group’s Mines Wellness Suites office project and College Heights Estate retail and industrial real estate development. (The Edge)

Berjaya Sports Toto Bhd’s (BToto) 4QFY21 net profit stood at RM30.5m vs. a net loss of RM43.3m recorded in the previous corresponding quarter, as its number forecast operations saw a significant jump in the number of draws conducted compared with the same quarter last year. Revenue for the quarter jumped 137.9% YoY to RM1.13bn. (The Edge)

BP Plastics Holding Bhd’s 2QFY21 net profit grew 74.4% YoY to RM14.8m, on better demand across the board, led by the Asian market. Revenue for the quarter expanded 35.7% YoY to RM108.9m. A single tier interim dividend of 2.0 sen per share and a special dividend of 1.0 sen per share, payable on 8th October 2021 was declared. (The Edge)

Apollo Food Holdings Bhd has announced a temporary stoppage at one of its Johor manufacturing facilities to curb the spread of Covid-19, just three days after another plant located nearby was allowed to resume operations after a one-week shutdown. The premises of its wholly-owned Apollo Food Industries (M) Sdn Bhd, located at No. 3, Jalan Kilang, in the Larkin Industrial Area in Johor Bahru, had received notice from the Ministry of Health to temporarily stop its operations from 9.00pm on 20th August 2021 until 25th August 2021. (The Edge)

Source: Mplus Research - 23 Aug 2021