Solidifying above 1,400

Market Review

Malaysia:. The FBM KLCI (+0.8%) rose in tandem with gains across the regional markets after more than two-thirds of the key index components closed in green. The lower liners marched higher, while the plantation (-0.5%) and transportation & logistics (-0.2%) sectors underperformed the positive sectorial peers.

Global markets:. Wall Street rallied as the Dow (+1.0%) jumped after banks and technology giants advanced on easing concerns around the state of the banking sector. The European stockmarkets remained upbeat, while Asia stockmarkets closed mostly higher.

The Day Ahead

The FBM KLCI extended gains amid improved sentiment on the regional markets as fears over the global banking crisis appeared to ease. We believe the risk appetite on the local front will return, as upbeat earnings reports in the US, coupled with the expectations that the US Fed might be pausing the interest rate hikes may lift the market sentiment on the global markets. Meanwhile, we will also monitor the developments on the China visit by our Prime Minister and traders might speculate big investments to be expected. Commodities wise, the Brent crude oil remained firm above USD78, while the CPO traded above RM3,700. Gold price staged a mild pullback, hovering around USD1,965.

Sector focus:. With Wall Street reclaimed its uptrend overnight, the technology sector on the local front may follow suit amid improving risk appetite. Besides, investors may look for trading opportunities in the energy sector in anticipation of higher crude oil price amid improved sentiment.

FBMKLCI Technical Outlook

The FBM KLCI closed higher for the second session, breaching above its immediate resistance at 1,420. Technical indicators turned fairly positive as the MACD Histogram extended a positive bar, while the RSI is approaching 50. Next resistance is pegged along 1,445-1,460, while the support is located at 1,370-1,380.

Company Brief

Kim Loong Resources Bhd’s 4QFY23 net profit rose 15.4% YoY to RM36.9m, supported by better performance from its milling operations due to better processing margin and higher processing volume Revenue for the quarter, however, fell 13.1% YoY to RM431.8m. A final single tier dividend of 5.0 sen per share was declared. (The Star)

Bina Darulaman Bhd (BDB) has proposed to acquire Gemi Puncak Sdn Bhd and Gemi Puncak Quarry Sdn Bhd for RM13.0m. BDB’s subsidiary, BDB Infra Sdn Bhd signed a share sale agreement with Gemi Puncak and Gemi Puncak Quarry. Gemi Puncak Quarry located in the Ulu Melaka, is the largest granite quarry in Langkawi and covers an area of 60.0-ac and has an annual production capacity of 240,000MT. (The Star)

Tenaga Nasional Bhd (TNB)’s wholly-owned subsidiary TNB Power Generation Sdn Bhd (TNB Genco) has issued RM2.00bn in sustainability sukuk wakalah to fund the development of the Nenggiri Hydroelectric Power Plant project in Kelantan. The issuance was the second under its 30-year Sukuk Wakalah Programme of up to RM10.0bn nominal value. (The Edge)

Petronas Dagangan Bhd (PetDag) has lodged to the Securities Commission of Malaysia the relevant documents for its Islamic Medium Term Notes (IMTN) and Islamic Commercial Papers (ICP) programmes of up to RM10.0bn. The ICP will have a tenure of 7 years from the date of first issuance. The tenure of each ICP will be between one month and 12 months. (The Edge)

Sime Darby Bhd reiterated that it has not made any decision to divest its joint venture with Australia’s Ramsay Health Care Ltd. However, Sime Darby continuously evaluates corporate opportunities to enhance value for its shareholders. (The Edge)

Tanco Holdings Bhd indirect unit Palm Springs Development Sdn Bhd (PSD) has appointed sister company Gplex Realty Sdn Bhd (GRSB) to market the remaining available and unsold units of the Splash Park Suites project in Port Dickson in a related party transaction (RPT). Splash Park Suites comprises 413 units in its first tower, construction of which is almost completed although 119 units are still unsold. The deal is deemed an RPT as Tanco’s group managing director Datuk Seri Andrew Tan Jun Suan is an indirect major shareholder of Tanco as well as an indirect major shareholder in GRSB. (The Edge)

MKH Bhd plans to list its oil palm plantation arm MKH Oil Palm (East Kalimantan) Bhd (MKHOP) on the Main Market of Bursa Malaysia by 4Q23. MKH proposes to undertake an initial public offering (IPO) of 24.5% of MKHOP’s enlarged share capital, after completing a slew of pre-listing corporate exercises. Prior to the IPO, MKHOP is to undertake a 1-to-6 share split which would result in the unit’s share base expanding from 110.5m shares to 662.8m shares, with a maintained issued share capital of 110.5m. (The Edge)

YBS International Bhd is exploring a collaboration with Enovix Corp to develop the former's existing facility at the Penang Science Park as Enovix's new 3D lithium ion silicon battery assembly plant in Southeast Asia. Enovix accepted its non-binding letter of interest for the collaboration on 29th March 2023. The final decision on the project is subject to YBS’ due diligence, further evaluation and determination of various commercial, legal and regulatory and financial factors. (The Edge)

Coraza Integrated Technology Bhd has planned a private placement of up to 20.0% of its share base to raise an estimated RM69.5m, mainly to fund the purchase of new machinery. The placement will comprise the issuance of up to 85.9m shares to independent third parties to be identified, at an issue price to be determined. The estimated amount to be raised is based on an indicative price of 81.0 sen apiece, which represents a discount of 9.5% to the 5-day volume weighted average market price up to 28th March 2023 of 89.53 sen per share. (The Edge)

Bintai Kinden Corp Bhd has been classified as a Practice Note 17 (PN17) issuer after its subsidiary defaulted on RM109.0m worth of financing facilities. This came after MBSB Bank Bhd terminated Bintai Kinden's role as the corporate guarantor for the RM109.0m Islamic banking facilities granted to the group’s wholly-owned unit Optimal Property Management Sdn Bhd. (The Edge)

Source: Mplus Research - 30 Mar 2023