Market Review

Malaysia: The FBM KLCI (+0.9%) was powered higher by the eleventh-hour buying support in selected plantation and banking heavyweights yesterday. The lower liners, however, retreated on profit taking activities, while the broader market ended mostly lower with the energy sector (-2.4%) anchoring the losers list.

Global markets: The US stockmarkets extended their losses as the Dow declined 0.2% on the back of the concern over lofty valuations, coupled with the prospects of slower economic growth. European stockmarkets remained downbeat, while Asia stockmarkets finished mostly lower.

The Day Ahead

The FBM KLCI was up firmly in the positive territory following a volatile session, as last-minute buying in selected heavyweights led by PMETAL (+17.0 sen) and MISC (+30.0 sen) lifted the key index. Economic recovery seems to be on track with Kuala Lumpur, and Putrajaya transitioning to Phase 2 of the NRP from Friday, and active cases dropping for the eighth consecutive day; investors might turn more optimistic going forward. Nevertheless, investors may mildly cautious ahead of the OPR decision by Bank Negara today, where BNM statement may provide clues to the current economic situation and future recovery outlook for Malaysia. Commodities wise, both CPO and crude oil prices advanced.

Sector focus: Reopening of more economic sectors may bode well for the recovery theme sector, such as consumer-related, construction and property-related. Meanwhile, the surge in CPO price may attract buying interest in plantation counters.

FBMKLCI Technical Outlook

The FBM KLCI climbed above the SMA200 level as the key index finished at its intraday high. Technical indicators remained mixed as the MACD Histogram has extended a red bar, while the RSI is turning higher above 50. The resistance is envisaged at 1,600-1,620, while the support is pegged along 1,580.

Company Brief

AirAsia Group Bhd’s 2QFY21 net loss narrowed to RM580.1m, from a net loss of RM992.9m recorded in the previous corresponding quarter, driven by better cargo contribution. Revenue for the quarter jumped 160.8% YoY to RM370.6m. (The Star)

Green Packet Bhd is slated to run Malaysia’s first proof of concept (POC) multi lane free-flow (MLFF) tolling system for expressways in Malaysia next year. In a collaboration with Taiwan’s FETC International Co. (FETCi), MLFF POC would be installed at Besraya Highway KM5.5 (northbound) and is scheduled for a three month data collection starting early 2022. (The Star)

Top Glove Corp Bhd reported that it does not have any link or relationship with Top Gloves Investment, which was previously flagged as a possible clone of the glove manufacturing group by the Securities Commission Malaysia. The group also denied any link to any investment programme or trading platform for investments. (The Edge)

Unisem (M) Bhd has reported that its plants in Ipoh have been ordered to shut for seven days from 8th September 2021 to 15th September 2021 by the Ministry of Health. The loss in production arising from the closure is estimated to be approximately 2.0% of the group's total annual production. (The Edge)

The Employees Provident Fund (EPF) trimmed its stake in IOI Corp Bhd to 13.2% on 2nd September 2021, from 13.3% on 25th August 2021 after the fund sold shares in the oil palm planter in several tranches as the latter's share price topped RM4.00 for the first time in over two months. (The Edge)

Theta Edge Bhd has appointed Nuraslina Zainal Abidin as its new group chief executive officer (CEO) for a two-year term, effective immediately. The appointment was subsequent to A Shukor S A Karim's retirement from his post as Theta Edge's group CEO at the conclusion of the company's 28th annual general meeting on 28th June 2021. (The Edge)

Pertama Digital Bhd has announced that its subsidiary Television Airtime Services Sdn Bhd (TAS) has completed the acquisition of a further 24.0% of the total ordinary shares in govtech software company Dapat Vista (M) Sdn Bhd from HeiTech Padu Bhd. This followed an announcement in July 2021 that TAS had exercised its contractual option to acquire the additional stake on top of the 56.0% it already held in Dapat. (The Edge)

YTL Corp Bhd’s 4QFY21 net loss widened to RM408.5m, from a net loss of RM251.6m recorded in the previous corresponding quarter, dragged down by a huge deferred tax of RM595.0m booked in the quarter. Revenue for the quarter, however, grew 23.9% YoY to RM4.37bn. A dividend of 2.5 sen per share for the quarter, payable on 12th October 2021 was declared. (The Edge) 

The proposed selective capital reduction (SCR) and privatisation of MMC Corp Bhd by tycoon Tan Sri Syed Mokhtar Albukhary are deemed not fair, but reasonable, according to independent adviser Alliance Investment Bank Bhd. The SCR is not fair as the offer price of RM2.00 per share is lower than the estimated value of between RM3.32 and RM3.41. However, the adviser is of view that the proposal is reasonable on grounds that MMC shares had not traded above the offer price for three years before the proposal was announced on 3rd June 2021. (The Edge)

Duopharma Biotech Bhd has denied appointing any party including Bintai Kinden Corp Bhd's unit Bintai Healthcare Sdn Bhd as a distributor of the Sinopharm Covid- 19 vaccine in Malaysia. The pharmaceutical company was referring to a report concerning Bintai Healthcare partnering with the company to distribute the vaccine in the country. (The Edge)

Serba Dinamik Holdings Bhd co-founder and non-independent director Datuk Awang Daud Awang Putera was forced to sell 1.8m shares yesterday. Following the disposal of the shares, his stake in Serba Dinamik stands at 23.6m shares or 0.6%. The last time Awang Daud was forced to sell his shares on 28th June 2021 when he had to dispose of 22.7m shares and another 4.3m shares on 30th June 2021. (The Edge)

Source: Mplus Research - 9 Sept 2021