Swift rebound

Market Review

Malaysia:. The FBM KLCI (+1.1%) recovered all its previous session losses with more than two-third of the key index components advanced as the FBM KLCI trimmed its weekly losses to -0.7% WoW. The lower liners also rebounded, while the energy sector (-2.1%) was the sole decliner on the broader market.

Global markets:. Wall Street extended its gains as the Dow (+2.5%) rallied on the robust US personal spending data that rose 2.1% MoM in January 2022 and signs of receding geopolitical tension between Ukraine and Russia. The European stockmarkets were also upbeat, while Asia stockmarkets ended mostly higher.

The Day Ahead

The FBM KLCI erased losses from a turbulent week along with the regional peers, as investors shrugged off Russia-Ukraine geopolitical tensions last week. Although Wall Street’s rebound extended on Friday, market condition is likely to remain fragile as the US stock futures trended lower at the time of writing on the back of returning concern on the Ukraine-Russia tension as President Putin puts his nuclear forces on high alerts. The Brent oil is trading above USD103, while CPO is likely to rebound after last week’s retracement.

Sector focus:. The commodity-linked sectors such as energy, metal-related, and plantation stocks should continue to be the prevailing theme despite a mild pullback on prices last week. Meanwhile, we expect selected local companies may be driven by the final day of the 4Q reporting season.

FBMKLCI Technical Outlook

The FBM KLCI staged a rebound on Friday to close above the daily EMA9 level after hovering in the positive territory for the entire session. Technical indicators remained mixed as the MACD is hovering below the zero level, while the RSI has rebounded above 50. Support is now set at 1,570-1,580 level, while the resistance is pegged around 1,600-1,620.

Company Brief

Public Bank Bhd’s 4QFY21 net profit increased 20.3% YoY to RM1.38bn, as its core lending and deposit business continued to support the group’s financial performance. Revenue for the quarter, however, fell 1.2% YoY to RM4.86bn. (The Star)

AMMB Holdings Bhd’s 3QFY22 net profit rose 52.8% YoY to RM403.3m, boosted by a tax credit amounting to RM234.0m that cushioned the impact of higher net impairment charge of RM337.0m. Revenue for the quarter improved marginally by 0.6% YoY to RM1.18bn. (The Edge)

Press Metal Aluminium Holdings Bhd’s 4QFY21 net profit jumped 96.8% YoY to RM285.8m, bolstered by higher revenue and contribution from associate companies. Revenue for the quarter added 63.9% YoY to RM3.37bn. A fourth interim dividend of 1.0 sen per share, payable on 31st March 2022 was declared. (The Edge)

Sime Darby Property Bhd does not rule out the possibility of establishing a real estate investment trust as part of the group’s transformation journey from a pure play property developer into a real estate company. This is after, among others, the creation of an industrial development fund, which will be part of the investment and asset manager business under Sime Darby Property’s SHIFT 25 business model. (The Edge)

Telekom Malaysia Bhd’s (TM) 4QFY21 net profit fell 69.2% YoY to RM79.9m, on higher operational costs. Revenue for the quarter, however, rose 5.1% YoY to RM3.15bn. An interim single-tier dividend of 6.0 sen per share, payable on 31st March 2022 was declared. (The Edge)

Pharmaniaga Bhd has inked Memoranda of Understanding (MOUs) with two biotechnology companies based in Thailand for vaccine research & development and bioequivalence solutions as well as pharmaceutical product development innovation. The MOUs were signed between Pharmaniaga LifeScience Sdn Bhd (PLS) and BioNet Group, and Pharmaniaga Research Centre Sdn Bhd (PRC) with Bio-Innova Co Ltd. PLS and PRC are wholly-owned subsidiaries of the group. (The Edge)

Samchem Holdings Bhd’s 4QFY21 net profit improved 32.1% YoY to RM23.9m, underpinned by higher sales volume and average selling prices. Revenue for the quarter gained 41.3% YoY to RM430.5m. A fourth interim dividend of 1.5 sen per share was proposed. (The Edge)

BCM Alliance Bhd has disposed of its entire stake in printed circuit board (PCB) company BSL Corp Bhd at a RM5.5m loss, citing market uncertainties and the conflict between Russia and Ukraine as its rationale. This comes after the group had spent an aggregate sum of RM7.1m in cash to acquire a 4.4% stake or 4.3m shares in BSL in the open market from 25th August 2021 to 2nd November 2021. (The Edge)

Frontken Corp Bhd's 4QFY21 net profit rose 26.9% YoY to RM29.6m, mainly attributable to improved revenue, strict cost management and continual process enhancements that led to better production efficiency. Revenue for the quarter expanded 20.2% YoY to RM121.5m. A second interim dividend of 2.5 sen per share was proposed. (The Edge)

IGB Bhd’s 4QFY21 net profit stood at RM233.8m vs. a net loss of RM10.4m recorded in the previous corresponding quarter, bolstered by a RM193.4m one-off gain from the disposal of a joint-venture company. Revenue for the quarter rose 8.6% YoY to RM300.5m. An interim dividend of 5.0 sen per share, payable on 18th March 2022 was declared. (The Edge)

IOI Properties Group Bhd’s 2QFY22 net profit fell 26.5% YoY to RM125.7m, due to fair value loss of IOI Mall, Xiamen, amounting to RM98.4m. Revenue for the quarter, however, grew 19.2% YoY to RM704.8m. (The Edge)

Malaysian Pacific Industries Bhd’s (MPI) 2QFY22 net profit rose 27.3% YoY to RM85.3m, amid higher contribution from its Asia, US and Europe segments. Revenue for the quarter added 25.6% YoY to RM608.0m. (The Edge)

Malaysia Steel Works (KL) Bhd’s (Masteel) 4QFY21 net profit rose 46.7% YoY to RM12.0m, boosted by a tax credit amounting RM5.1m. Revenue for the quarter climbed 24.4% YoY to RM463.9m. (The Edge)

MBM Resources Bhd’s 4QFY21 net profit added 52.2% YoY to RM109.5m, driven by improved performance of its auto trading and auto parts manufacturing businesses. Revenue for the quarter improved marginally by 0.3% YoY to RM562.2m. A dividend of 15.0 sen per share, comprising a special dividend of 10.0 sen and a second interim dividend of 5.0 sen, payable on 30th March 2022 was declared. (The Edge)

Paramount Corp Bhd's 4QFY21 net profit 589.8% YoY to RM24.4m, on the back of higher sales. Revenue for the quarter expanded 68.5% YoY to RM317.3m. A final dividend of 3.0 sen per share was proposed. (The Edge)

Serba Dinamik Holdings Bhd has announced the appointment of Ahmad Amryn Abd Malek and Felix Chin Wui Choong as independent directors effective 25th February 2022. Chin and Ahmad Amryn have also been appointed to its audit and risk committee, while Ahmad Amryn was also appointed to the company’s nomination and remuneration committee. (The Edge)

TIME dotCom Bhd’s 4QFY21 net profit rose 15.1% YoY to RM108.6m, helped by growth in retail and enterprise customers. Revenue for the quarter grew 17.9% YoY to RM371.1m. (The Edge)

Tropicana Corp Bhd’s 4QFY21 net profit sank 83.2% YoY to RM7.9m, mainly due to the disposals of two parcels of land in Johor Bahru for a combined RM157.4m recorded in the previous corresponding quarter. Revenue for the quarter fell 26.8% YoY to RM263.8m. (The Edge)

UMW Holdings Bhd's 4QFY21 net profit added 55.0% YoY to RM240.0m, supported by strong contributions from its automotive and equipment segments as demand recovered after the lifting of the Full Movement Control Order. Revenue for the quarter by 12.7% YoY to RM3.65bn. A final dividend of 5.8 sen per share, payable on 29th April 2022 was declared. (The Edge)

Unisem (M) Bhd’s 4QFY21 net profit dipped 5.7% YoY to RM57.5m, on higher operational costs. Revenue for the quarter, however, rose 16.1% YoY to RM426.4m. A dividend of 2.0 sen per share, payable on 8th April 2022 was declared. (The Edge)

Source: Mplus Research - 28 Feb 2022