Back above 1,600

Market Review

Malaysia:. The FBM KLCI (+1.0%) started off the week on a buoyant manner, boosted by gains in more than two-third of the key index constituents as the key index recorded +6.3% MoM improvement. The lower liners, however, edged lower, while the broader market closed mostly negative.

Global markets:. Wall Street edged lower as the Dow (-0.5%) pared some of its previous session gains on the back of the on-going concern over the geopolitical developments between Russia and Ukraine. The European stockmarkets ended mixed, but Asia stockmarkets closed mostly positive.

The Day Ahead

The FBM KLCI outperformed the mixed regional bourses with significant gains despite the lingering geopolitical tensions. Despite the mixed sentiment on Wall Street, we believe the positive sentiment will continue on the local bourse, given the (i) increasing inflows of foreign funds, (ii) firmer crude palm oil prices which may translate to upside on the plantation sector and (iii) decent performance in the banking sector’s results. Nevertheless, upside might be capped with the unsettled Russia-Ukraine geopolitical tension. Meanwhile, investors should keep an eye on the Bank Negara Malaysia’s interest rate decision on Thursday.

Sector focus:. We remained optimistic on the outlook for the energy, banking, plantation and consumer sectors amid the firm crude oil and crude palm oil prices and the recovery in the business activities overall. Meanwhile, investors might look for bargain hunting activities within the technology sector as selected technology stocks are oversold.

FBMKLCI Technical Outlook

The FBM KLCI extended its gains to close above the 1,600 psychological level. Technical indicators, however, remained mixed as the MACD Histogram has extended a negative bar, while the RSI trended higher above the 50 level. The next resistance is pegged around 1,615, while the support level is located around 1,570- 1,580.

Company Brief

Affin Bank Bhd’s 4QFY21 net profit stood at RM206.9m vs. a net loss of RM9.4m recorded in the previous corresponding quarter, due to improved Islamic banking income, lower operating expenses and allowance for impairment losses offset by lower gain on sales of financial instruments, net fee and commission income and net interest income. Revenue for the quarter, however, declined 7.8% YoY to RM572.1m. (The Star)

EP Manufacturing Bhd’s (EPMB) 4QFY21 net profit stood at RM2.7m vs. a net loss of RM0.9m recorded in the previous corresponding quarter, on the back of the group’s strategic measures to streamline costs and improve operational efficiency, as well as lower depreciation and amortisation in the quarter under review as some machineries have been fully depreciated. Revenue for the quarter, however, fell 5.5% YoY to RM126.8m. (The Star)

Hong Leong Bank Bhd (HLB)'s 2QFY22 net profit rose 10.1% YoY to RM738.6m, on lower allowances for impairment losses on loans, advances and financing of RM207.6 m, higher write-back of impairment losses on financial investments and other assets of RM300,000, and a higher share of profit from associated companies of RM83.4 m in the current quarter under review. Revenue for the quarter, however, slipped 2.1% YoY to RM1.37bn. An interim dividend of 18.0 sen per share, payable on 25th March 2022 was declared. (The Edge)

Hong Leong Financial Group Bhd (HLFG)’s 2QFY22 net profit rose 6.1% YoY to RM559.5m, underpinned by a higher contribution from its commercial banking division. Revenue for the quarter, however, fell 4.6% YoY to RM1.54bn. An interim dividend of 15.0 sen per share, payable on 30th March 2022 was declared. (The Edge)

RHB Bank Bhd’s 4QFY21 net profit increased 43.9% YoY to RM631.2m, attributed to lower expected credit losses (ECL). Revenue for the quarter, however, fell 6.2% YoY to RM2.89bn. A final dividend of 25.0 sen per share, comprising 15.0 sen cash and an electable portion under the dividend reinvestment plan of 10.0 sen per share was proposed. (The Edge)

Alliance Bank Malaysia Bhd (ABMB)’s 3QFY22 net profit rose 50.3% YoY to RM151.0m, fuelled by higher interest income and lower credit cost. Revenue for the quarter rose marginally by 0.9% YoY to RM480.2m. (The Edge)

CIMB Group Holdings Bhd’s 4QFY21 net profit soared 297.5% YoY to RM854.5m, due to significantly lower provisions. Revenue for the quarter, however, fell 1.7% YoY to RM4.59bn. A second interim dividend of 12.55 sen per share was proposed. (The Edge)

PPB Group Bhd’s 4QFY21 net profit rose 30.4% YoY to RM502.6m, lifted by improved contribution from Wilmar International Ltd and lower losses recorded from its film exhibition and distribution segment. Revenue for the quarter added 25.0% YoY to RM1.42bn. A final dividend of 25.0 sen per share, payable on 21st June 2022 was declared. (The Edge)

Boustead Holdings Bhd’s 4QFY21 net profit stood at RM78.6m vs. a net loss of RM352.3m registered in the previous corresponding quarter, driven by better contributions from all business divisions. Revenue for the quarter climbed 32.8% YoY to RM2.96bn. (The Edge)

ATA IMS Bhd's 3QFY22 net profit sank 89.6% YoY to RM5.5m, due to manpower shortages that resulted in underutilisation of production capacity. Revenue for the quarter declined 41.7% YoY to RM683.8m. (The Edge)

Bank Islam Malaysia Bhd (BIMB)’s 4QFY21 net profit dropped 55.1% YoY to RM79.6m, due to higher allowance charged for impairment on financing and advances during the current period mainly due to expected credit loss provided to one non-retail customer which turned impaired in the period. Revenue for the quarter, however, added 7.6% YoY to RM816.3m. (The Edge)

Berjaya Corp Bhd’s (BCorp) 2QFY22 net profit stood at RM101.0m vs. net loss of RM49.7m recorded in the previous corresponding quarter, mainly on the gain from disposal of 30.0% stake in its associated company, Razer Fintech Holdings Ltd, amounting to RM161.0m, as well as a higher share of results of associates and joint ventures. Revenue for the quarter grew 5.9% YoY to RM2.06bn. (The Edge)

Capital A Bhd’s 4QFY21 net loss narrowed to RM884.1m, from a net loss of RM2.46bn recorded in the previous corresponding quarter, on the back of higher aviation revenue, growth from its digital business, strict cost control measures as well as an absence of impairments and fuel swap losses. Revenue for the quarter jumped 118.4% YoY to RM717.12m. (The Edge)

EA Technique (M) Bhd is now classified as an affected listed issuer under Practice Note 17 (PN17) of the Main Market Listing Requirements as it had triggered the criteria pursuant to Paragraphs 2.1 (a) and 2.1(e) of PN17 of the MMLR. The prescribed criteria was triggered due its shareholders’ equity of RM6.0m as at 31st December 2021 is less than RM40.0m and 50.0% of its share capital of RM179.8m, respectively. (The Edge)

FGV Holdings Bhd’s 4QFY21 net profit surged 254.9% YoY to RM465.1m, underpinned by significant improvement in the plantation sector on the back of higher palm oil prices. Revenue for the quarter climbed 54.3% YoY to RM6.18bn. A final dividend of 8.0 sen per share, payable on 31st March 2022 was declared. (The Edge)

Samaiden Group Bhd’s newest substantial shareholder, Japan-based and listed engineering company Chudenko Corp has emerged with a 7.3% stake or 16.8m shares, after taking part in the renewable energy (RE) and environment solutions provider’s private placement for RM21.3m. Samaiden raised a total of RM25.3m from the private placement, which it intends to use to partially fund its investment in RE assets. (The Edge)

Malaysia Airports Holdings Bhd’s (MAHB) 4QFY21 net loss narrowed to RM136.7m, from a net loss of RM685.0m recorded int the previous corresponding quarter, due to the significant increase in passenger volumes for the group with the easing of the Movement Control Order, interstate travel and introduction of Vaccinated Travel Lane in Malaysia coupled with continued positive recovery momentum in Turkey. Revenue for the quarter rose 109.1% YoY to RM551.3m. (The Edge)

Mah Sing Group Bhd’s 4QFY22 net profit climbed 49.0% YoY to RM40.0m, contributed by its property development and manufacturing segments. Revenue for the quarter rose 13.7% YoY to RM537.4m. A first and final dividend of 2.65 sen per share was proposed. (The Edge)

Malayan Flour Mills Bhd’s (MFM) 4QFY21 net profit grew 39.1% YoY to RM24.0m, on higher operating profit and revenue from its flour and grains trading segment. Revenue for the quarter increased 20.2% YoY to RM694.7m. An interim dividend of 2.0 sen per share, payable on 25th March 2022 was declared. (The Edge)

Nationwide Express Holdings Bhd's application for an extension of time to submit its regularisation plan has been rejected by Bursa Malaysia. Hence, pursuant to paragraph 8.04(5) of the Main Market Listing Requirements, its shares trading will be suspended from trading with effect from 8th March 2022. The securities of the company will be delisted on 10th March 2022, unless an appeal against the delisting is submitted on or before 7th March 2022. (The Edge)

S P Setia Bhd’s 4QFY21 net profit jumped 118.2% YoY to RM123.3m, on improved profit margin and higher share of results from some joint venture companies. Revenue for the quarter, however slipped 7.3% YoY to RM1.03bn. (The Edge)

Star Media Group Bhd’s 4QFY21 net loss stood widened to RM25.4m, from a net loss of RM15.7m recorded in the previous corresponding quarter, dragged mainly by the one-off item on impairment of assets of RM39.0m. Revenue for the quarter, however, inched up by 1.1% YoY to RM51.5m. (The Edge)

Source: Mplus Research - 1 Mar 2022