Sustained buying support

Market Review

Malaysia:. The FBM KLCI (+0.1%) managed to recover all its intraday losses as the key index clawed its way into the positive territory in the final trading hour, lifted by the buying support in selected oil & gas and banking heavyweights. The lower liners finished mostly higher, while the broader market ended mostly positive.

Global markets:. The US stockmarkets rebounded as the Dow rose 0.3% boosted by the stronger-than-expected pending home sales data in August 2021 that rose 8.1% MoM vs. consensus expectations of 1.4% MoM rise. European stockmarkets also advanced, while Asia stockmarkets closed mostly lower.

The Day Ahead

The FBM KLCI finished in the positive territory on the back of final hour buying despite cautious sentiment after World Bank revising downwards on Malaysia’s 2021 economic growth projection. Meanwhile, transportation and logistics players were under the limelight amid surging strong result posted by HARBOUR and Baltic Exchange Dry Index. Note that the index climbed near 5,000 amid ongoing shipping constraints and rising global demand. Meanwhile, the energy sector staged a pullback in tandem with declined crude oil price, but CPO rebounded and may retest the RM4,500.

Sector focus:. We reckon there should be follow-through buying interest in the transportation and logistics counters given the strong momentum yesterday. Besides, investors may continue to collect bashed-down stocks in recovery theme sectors such as aviation and consumer. Also, we believe some of the construction and property companies are having significant trading interest after the tabling of 12MP and ahead of the Budget 2022 announcement.

FBMKLCI Technical Outlook

The FBM KLCI closed in the green with marginal gains, ending just below the daily EMA20 level. Technical indicators remained negative as the MACD Histogram has extended a red bar, while the RSI continued hovering below the 50 level. Resistance is envisaged along 1,550-1,560, while the support is set at 1,515.

Company Brief

Gamuda Bhd’s 4QFY21 net profit stood at RM214.1m vs. a net loss of RM12.5m recorded in the previous corresponding quarter, amid stronger construction and property earnings as work on all fronts picked up pace on the back of rigorous Covid-19 control measures. Revenue for the quarter, however, fell 4.1% YoY to RM886.7m. (The Star)

Serba Dinamik Holdings Bhd’s 6QFY21 net profit stood at RM14.9m; the lowest quarterly net profit since the oil and gas services firm went public in early 2017. Revenue for the quarter was at RM1.21bn. There were no comparative figures available as the group changed their financial year end to 30th June, from 31st December. (The Star)

Widad Group Bhd was awarded a RM244.3m contract by the Public Works Department to build an expressway in Kelantan. The project is the final phase of the new central spine road between Bentong in Pahang and Kota Bahru in Kelantan. Construction work on the project was scheduled to start by the end of December 2021, to be completed in 36 months. (The Star)

Scientex Bhd's 4QFY21 net profit rose marginally by 0.4% YoY to RM142.7m, on stable packaging demand and higher sales of affordable homes in Malaysia. Revenue for the quarter improved 1.6% YoY to RM970.4m. A final dividend of 5.0 sen per share, payable on 13th January 2022 subject to shareholders approval in the forthcoming annual general meeting was proposed. (The Edge)

Astro Malaysia Holdings Bhd and Telekom Malaysia Bhd (TM) have entered into a collaboration in delivering high-quality digital experience to all Malaysians through the provision of reliable broadband and content services. The move is part of their commitment to supporting the Jalinan Digital Negara (JENDELA) initiative in providing wider broadband coverage and a better experience nationwide. (The Edge)

IOI Properties Group Bhd’s wholly-owned subsidiary Boulevard View Pte Ltd has been successful in its bid to buy a 0.8-ha leasehold land known as the White site at Singapore’s Marina View enclave for S$1.51bn (RM4.68bn). Boulevard View was the sole bidder. The land tender represents an attractive and viable opportunity to venture into a mixed-use development comprising residential, hotel and commercial elements in the Marina Bay area. (The Edge)

Sapura Energy Bhd has announced that its chairman Tan Sri Shamsul Azhar Abbas had resigned from both its nomination and remuneration committees. The 69-year old's resignation as a member of the committees will be effective on 1st October 2021. (The Edge)

FGV Holdings Bhd has denied that the plantation giant plans to set up an oil palm processing unit in the south Indian State of Telangana. The group’s presence in India is through FGVPU India Private Ltd, a joint venture based in Hyderabad between FGV Trading Sdn Bhd (FGVT) and Pre-Unique India Pvt Ltd. (The Edge)

Green Packet Bhd’s 2QFY21 net loss widen to RM49.2m, from a net loss of RM12.0m registered in the previous corresponding quarter, on the back of fair value loss on other quoted investment amounting to RM17.7m. Revenue for the quarter declined 13.9% YoY to RM124.8m. (The Edge)

Notion VTec Bhd’s 3QFY21 net loss widened to RM11.3m, compared to a net loss of RM10.9m recorded in the previous corresponding quarter, as its machining business was affected by the Movement Control Order, rise in metal cost of up to 60.0%, and labour shortage. Revenue for the quarter, however, jumped 122.7% YoY to RM89.2m. (The Edge)

Karex Bhd’s 4QFY21 net loss stood at RM5.1m vs. a net profit of RM1.4m recorded in the previous corresponding quarter, dragged down by unavoidable operational expenses arising from the lockdown and higher distribution expenses. Revenue for the quarter, however, gained 17.2% YoY to RM106.7m. (The Edge)

Berjaya Corp Bhd’s 4QFY21 net loss eased to RM242.5m, from a net loss of RM323.8m registered in the previous corresponding quarter, on improved contribution from the gaming, food and beverage, and consumer marketing business segments. Revenue for the quarter jumped 104.3% YoY to RM1.75bn. (The Edge)

Source: Mplus Research - 30 Sept 2021