Market Review

Malaysia: The FBM KLCI (+0.3%) extended its gains for the sixth straight session after recovering from its intraday losses at the opening bell; the key index rose 4.7% WoW. The lower liners, however, retreated, while the broader market closed mixed with the energy sector (+3.0%) outperformed.

Global markets: The US stockmarkets rebounded as the Dow rose 0.7% on US Federal Reserve Chairman, Jerome Powell remarks that the tapering on stimulus will be gradual, while interest rate hikes will come in 2022. European stockmarkets also finished higher, while Asia stockmarkets ended mixed.

The Day Ahead

The FBM KLCI maintained its winning streak throughout the week, spurred by strong buying interest from foreign funds (positive inflow streak: 5 days, cumulative net buying: RM964.3m) amid easing political risk and reopening of business activities. We believe the positive sentiment will continue to be supported by the Prime Minister’s target to achieve a vaccination rate of over 50.0% for adult population in another 6 states by the end of September, while considering moving Klang Valley into Phase 2 of NRP. Nevertheless, trading may slow down ahead of the National Day public holiday. Meanwhile, the crude oil prices closed above USD72 per barrel and gold prices shot up above USD1800 level.

Sector focus: The oil & gas sector is under the limelight following the increasing crude oil prices. Also, investors may focus on recovery theme play with the smooth vaccination progress. Besides, the technology sector may gain traction following the overnight gains in Nasdaq which closed at record high following the US Fed’s remarks on its dovish monetary policy.

The FBM KLCI witnessed six straight sessions of gains as the key index closed at highest point since early-June. Despite the MACD Histogram extended a green bar, the RSI is overbought above 70. Hence, the resistance could be located around 1,600, while the support is pegged along 1,580.

Company Brief

Genting Bhd’s 2QFY21 net loss narrowed to RM563.0m, from a net loss of RM786.0m recorded in the previous corresponding quarter, on improved results across its major operating divisions. Revenue for the quarter jumped 166.4% YoY to RM2.93bn. (The Star)

Malaysian Resources Corp Bhd (MRCB) wholly owned Seri Iskandar Development Corp Sdn Bhd (SIDEC) is buying 22.0-ac of leasehold land near Ipoh, Perak for RM31.5m from major shareholder Tan Sri Mohamad Salim Fateh Din. The subject properties are located opposite a proposed mixed development to be undertaken by SIDEC, which will bring additional gross development value to the Simpang Pulai Development that was at RM307.0m. (The Star)

Boustead Holdings Bhd’s 2QFY21 net loss narrowed to RM7.3m, compared with a net loss of RM73.7m recorded in the previous corresponding quarter, amid an improved performance from all divisions within the group. Revenue for the quarter grew 73.3% YoY to RM2.60bn. (The Star)

TIME Dotcom Bhd's 2QFY21 net profit rose 32.8% YoY to RM92.7m, boosted by higher contribution from its data centre and data products business. Revenue for the quarter expanded 14.0% YoY to RM347m. (The Star)

Public Bank Bhd’s 2QFY21 net profit rose 37.7% YoY to RM1.38bn, on higher net interest income, net income from Islamic banking, and net fee and commission income. Revenue for the quarter rose 3.8% YoY to RM4.92bn. A first interim dividend of 7.5 sen a share, payable on 23rd September 2021 was declared. (The Edge)

RHB Bank Bhd’s 2QFY21 net profit grew 75.0% YoY to RM701.3m on lower operational costs. Revenue for the quarter, however, dropped 10.2% YoY to RM2.93bn from RM3.25 bn. An interim dividend of 15.0 sen per share, with a cash payout of 5.0 sen per share, and an electable portion under dividend reinvestment plan of 10.0 sen per share was declared. (The Edge)

Axiata Group Bhd’s 2QFY21 net profit surged 201.3% YoY to RM227.8m, as most of its geographical segments posted better results. Revenue for the quarter grew 5.5% YoY to RM6.39bn. An interim dividend of 4.0 sen per share was proposed. (The Edge)

Telekom Malaysia Bhd’s (TM) 2QFY21 net profit fell 20.4% YoY to RM218.6m, citing an increase in operating costs which included provisions recognised as part of the group’s manpower optimisation initiatives. Revenue for the quarter, however, rose 6.6% YoY to RM2.76bn. A dividend of 7.0 sen a share, payable on 30th September 2021 was declared. (The Edge)

Bumi Armada Bhd’s 2QFY21 net profit rose 16.8% YoY to RM139.9m, underpinned by higher operating profit. Revenue for the quarter grew 1.4% YoY to RM615.6m. (The Edge)

Bank Negara Malaysia (BNM) has approved Malayan Banking Bhd’s (Maybank) plan to increase its share capital through the issuance of up to 298.0m new shares pursuant to the latter’s dividend reinvestment plan for its first interim dividend of 28.0sen. (The Edge)

OSK Holdings Bhd’s 2QFY21 net profit climbed 73.2% YoY to RM103.6m, as businesses were allowed to operate, although at lower operating capacities, despite the continuous lockdown. Revenue for the quarter gained 53.1% YoY to RM267.2m. An interim dividend of 1.0 sen per share, payable on 30th September 2021 was declared. (The Edge)

Alliance Bank Malaysia Bhd’s 1QFY22 net profit rose 40.0% YoY to RM146.0m, mainly due to higher net interest income and other operating income. Revenue for the quarter expanded 14.6% YoY to RM483.0m. (The Edge)

CI Holdings Bhd’s 4QFY21 net profit jumped 177.3% YoY to RM22.1m, on the back of increase in average olein prices. Revenue for the quarter improved 20.9% YoY to RM900.2m. A final dividend of 12.0 sen per share, subject to the approval of the shareholders at the forthcoming Forty-Third Annual General Meeting was declared. (The Edge)

CSC Steel Holdings Bhd’s 2QFY21 net profit stood at RM15.4m vs. a net loss of RM2.2m recorded in the previous corresponding quarter, on the back of lifted by higher sales volume and selling prices which resulted in improved product margins. Revenue for the quarter rose 67.2% YoY to RM203.0m. (The Edge)

Sarawak Plantation Bhd’s 2QFY21 net profit gained 51.6% YoY to RM29.4m, supported by higher average selling prices and sales volume. Revenue for the quarter jumped 97.7% YoY to RM192.6m. (The Edge)

Padini Holdings Bhd’s 4QFY21 net profit stood at RM10.5m vs. a net loss of RM16.8m recorded in the previous corresponding quarter, due to less impact on its outlets from the implementation of the Movement Control Order. Revenue for the quarter expanded 20.5% YoY to RM209.8m. (The Edge)

Kerjaya Prospek Property Bhd via its wholly-owned subsidiary Greencove Sdn Bhd has entered into a sale and purchase agreement with Prousaha (M) Sdn Bhd, a wholly-owned unit of Asia Pac Holdings Bhd, to acquire a parcel of leasehold land in Sungai Buloh, Selangor for RM42.0m cash. (The Edge)

Paramount Corp Bhd’s 2QFY21 net profit stood at RM1.6m vs. a net loss of RM4.0m recorded in the previous corresponding quarter, on higher revenue due to containment measures implemented to curb the spread of Covid-19. Revenue for the quarter jumped 98.5% YoY to RM127.5m. (The Edge)

Source: Mplus Research - 30 Aug 2021