Market Review

Malaysia: The FBM KLCI (+1.0%) recorded its fifth day winning streak amid the calmer market sentiment following the political stability, coupled with the recent batch of foreign funds inflow. The lower liners ended mixed, while the broader market was mostly upbeat with the plantation sector (+1.6%) outperformed.

Global markets: The US stockmarkets snapped their strings of gains as the Dow fell 0.5% after at least 60 Afghans and 12 US troops were killed near Kabul airport blast, while investors continue to lookout for the interest rate outlook tonight. European stockmarkets ended lower, while Asia stockmarkets finished mixed.

The Day Ahead

The FBM KLCI continued its winning run yesterday as the key index outperformed most of its regional peers following the return of foreign funds which saw a net buying value of RM310.8m. Also, investors will be waiting for the Cabinet line-up that will be releasing today and it is likely to boost investors’ confidence further. On the global front, investors are taking a breath while waiting for the outcome of the Jackson Hole symposium which may provide signals on the US Fed’s monetary policy. Meanwhile, the rising geopolitical tension surrounding the developments in Afghanistan could be concerning the markets at this point of time. Commodities wise, Brent oil retreated while the CPO price increased.

Sector focus: Investors may remain optimistic on the transportation and logistics counters over increasing Baltic Exchange Dry Index which saw another rise to 4,195 on Thursday. Besides, the recovery theme sectors such as banking and construction may continue to stay focus for the session.

The FBM KLCI marked a fifth session gain yesterday as the key index continued hovering above SMA100 level. Technical indicators remained positive as the MACD Histogram has extended a green bar, while the RSI is hovering above the 70 (overbought) level. With the key index crossing above the resistance level at 1,580, next resistance is envisaged around 1,600, while the support level is at 1,540.

Company Brief

Malayan Banking Bhd's 2QFY21 net profit jumped 108.4% YoY to RM1.96bn, underpinned by loans growth and a wider net interest margin (NIM) resulting from a more cost-effective funding mix and lower impairments. Revenue for the quarter, however, fell 3.8% YoY t RM11.34bn. A first interim dividend of 28.0 sen per share under the dividend reinvestment plan, comprising 14.0 sen per share to be paid in cash and the remainder to be either reinvested in new shares or paid in cash was declared. (The Star)

Sime Darby Property Bhd’s 2QFY21 net profit stood at RM19.9m vs. a net loss of RM81.8m recorded in the previous corresponding quarter, due to improved contribution from the property development segment. Revenue for the quarter grew 74.5% YoY to RM502.8m. A first interim dividend of 1.0 sen per share, payable on 16th November 2021 was declared. (The Star)

Kerjaya Prospek Group Bhd’s 2QFY21 net profit gained 59.0% YoY to RM16.0m, mainly due to the fully resumption of construction projects except during FMCO which started from 1st June 2021. Revenue for the quarter rose 48.2% YoY to RM189.9m. (The Star)

Tenaga Nasional Bhd’s (TNB) 2QFY21 net profit rose 25.8% YoY to RM821.5m, due to higher operating profit. Revenue for the quarter grew 14.2% YoY to RM12.44bn. An interim dividend of 22.0 sen per share was declared. (The Edge)

UOA Development Bhd’s 2QFY21 net profit jumped 134.5% YoY to RM54.4m, underpinned by the progressive recognition of its ongoing development projects. Revenue for the quarter rose 53.5% YoY to RM216.3m. (The Edge)

Pharmaniaga Bhd, Malaysia’s only license holder for the distribution of the Sinovac vaccine, is looking to grow its Covid-19 vaccine business as its main revenue contribution moving forward, as it seeks to expand its presence into Southeast Asian and African markets. (The Edge)

Kenanga Investment Bank Bhd’s 2QFY21 net profit rose 49.4% YoY to RM30.6m, mainly due to higher contributions from the stockbroking and investment management businesses. Revenue for the quarter increased marginally by 1.0% YoY to RM212.6m. (The Edge)

Petron Malaysia Refining & Marketing Bhd’s (Petron) 2QFY21 net profit stood at RM42.0m vs. a net loss of RM69.3m recorded in the previous corresponding quarter, on higher topline growth. Revenue for the quarter jumped 99.0% YoY to RM2.03bn. (The Edge)

Star Media Group Bhd’s 2QFY21 net loss widened to RM37.9m, from a net loss of RM27.0m recorded in the previous corresponding quarter, on higher operating expenses that offset the lower finance cost. Revenue for the quarter, however, improved 48.3% YoY to RM46.7m. (The Edge)

IHH Healthcare Bhd’s 2QFY21 net profit stood at RM483.3m vs. a net loss of RM120.6m recorded in the previous corresponding quarter, as more patients returned to the group’s hospitals for treatment in some markets including Malaysia, Singapore, India and Turkey as lockdowns eased. Revenue for the quarter added 66.5% YoY to RM4.27bn. (The Edge)

Media Prima Bhd’s 2QFY21 net profit stood at RM13.4m vs. a net loss of RM20.1m recorded in the previous corresponding quarter, on higher advertising revenue amid higher advertising spending during the Hari Raya festive season. Revenue for the quarter rose 23.8% YoY to RM292.5m. (The Edge)

Oriental Food Industries Holdings Bhd’s 1QFY22 net profit sank 75.1% YoY to RM1.1m, as it recorded lower revenue and gross profit margins amid higher operating costs. Revenue for the quarter retreated 18.2% YoY to RM60.2m. An interim dividend of 0.1 sen per share, payable on 6th October 2021 was declared. (The Edge)

The restricted offer for sale (ROFS) of IGB Commercial Real Estate Investment Trust (REIT) units to IGB Bhd shareholders under the REIT’s listing exercise has received lukewarm responses. At the closing of the restricted offering on 20th August 2021, the REIT’s manager had received valid acceptances for 242.0m ROFS units and 362.9m corresponding distribution-in-specie (DIS) units. This represents a subscription rate of 78.7%. (The Edge)

Affin Bank Bhd’s 2QFY21 net profit surged 85.8% YoY to RM174.0m, amid higher net interest income (NII). Revenue for the quarter rose 25.2% YoY to RM578.9m. (The Edge)

PPB Group Bhd’s 2QFY21 net profit fell 44.9% YoY to RM183.5m, as the group’s grain and agribusiness division fell into the red while contribution from consumer products also fell. Revenue for the quarter, however, climbed 13.6% YoY to RM1.08bn. An interim dividend of 10.0 sen per share, payable on 28th September 2021 was declared. (The Edge)

Sarawak Oil Palms Bhd’s (SOPB) 2QFY21 net profit jumped 156.4% YoY to RM98.3m, thanks to higher palm products prices. Revenue for the quarter expanded 51.6% YoY to RM949.1m. (The Edge)

Magnum Bhd’s 2QFY21 net profit stood at RM2.1m vs. a net loss of RM23.7m recorded in the previous corresponding quarter, as it managed to hold 28 draws prior to the full lockdown. Revenue for the quarter surged 645.9% YoY to RM326.5m. (The Edge)

Supermax Corp Bhd’s 4QFY21 net profit jumped 140.4% YoY to RM958.7m, due to strong demand of PPE products. Revenue for the quarter jumped 101.9% YoY to RM1.88bn. A special dividend of 15.0 sen per share for FY21, payable on 30th September 2021 was declared. (The Edge)

Dutch Lady Milk Industries Bhd’s 2QFY21 net profit rose 28.5% YoY to RM27.3m, thanks to higher demand for its products combined with a favourable portfolio and channel mix, which helped offset higher prices of global dairy raw materials. Revenue for the quarter grew 3.8% YoY to RM284.0m. (The Edge)

IOI Properties Group Bhd’s 4QFY21 net profit jumped 168.7% YoY to RM118.4m, amid higher share of results from joint ventures. Revenue for the quarter increased 7.9% YoY to RM658.7m. An interim dividend of 2.0 sen per share, payable on 24th September 2021 was declared. (The Edge)

7-Eleven Malaysia Holdings Bhd’s 2QFY21 net profit rose 8.4% YoY to RM1.1m in improved sales. Revenue for the quarter expanded 4.2% YoY to RM676.7m. (The Edge)

Source: Mplus Research - 27 Aug 2021