MSC (FV RM5.60 ' BUY) Initiating Coverage: Tin is in MalaysiaSmelting Corporation (MSC), one of the world's leading integrated producers oftin metal products, is set to derive steady income from its custom tin  smelting and mining operations in Malaysiaand Indonesia. That said, the group's long-term value will be enhanced byefforts to acquire new tin assets and divest its remaining non-tin assets. Assumingthe worst-case scenario for its foreign mining concessions, as well as an aggressiveWACC for its tin smelting and mining DCF and a moderate BV on its non-tin business,we arrive at a SOP-based FV of RM5.60. We initiate coverage on MSC with a BUYrating.

Heads south. The FBM KLCI shed 5.61 pts to end trading at1,597.51 following renewed concerns over the eurozone crisis  that dampened the global investment  sentiment. Today'skey headlines include: the Securities Commission has started investigationsinto alleged financial irregularities of Xian Leng Holdings asPricewaterhouseCoopers found that the company could not account for RM85.7m setaside to build ponds, and IGB Corp Bhd's unit Kris Assets Holding Bhd hasreiterated plans to set up a real estate investment trust (REIT) comprising twoshopping malls, The Gardens Mall and Mid Valley Megamall, to be listed in BursaMalaysia. Meanwhile, MMC-Gamuda JV SB may subcontract 4km of the My RapidTransit (MRT) tunnelling works to foreign parties, Bumi Armada bags USD200mLukoil EPIC contract and CIMB Group Holdings Bhd will sign a deal soon to buy60% of San Miguel Corp's unlisted banking arm. On the global front, the USmarkets closed mix while the price of crude oil closed higher yesterday. Theprice of crude oil was up by USD0.73 to close at USD103.19/barrel.

Bumi Armada's indirect unit Bumi Armada Caspian LLC hassecured a USD200mil contract from Russia's OAO Lukoil for a pipeline project inthe  Caspian Sea. It said on Monday thecontract involved the engineering, procurement, installation andpre-commissioning of subsea in-field and inter-field pipelines for theFilanovsky field in the Russian sector of the Caspian Sea. Bumi Armada said thecompletion period of the contract was estimated at 32 months and to besubstantially completed by end-2014. (StarBiz) Please see accompanying report

IGB Corp Bhd has proposed to set up and  list a real estate investment trust (REIT) onthe Main Market, comprising of two malls in Kuala Lumpur. It said on Monday theinitial properties would comprise of The Gardens Mall ' which is eight-storeyretail mall ' and Mid Valley Megamall, which is a five-storey retail mall with onemezzanine floor. These properties are currently owned by IGB's subsidiary,KrisAssets. 'In conjunction with the proposed REIT establishment and listing,IGB has today acquired a newly established subsidiary, IGB REIT Management SB,to act as the proposed management company for IGB REIT,' it said.  (StarBiz)

TSM Global has agreed to the proposed takeover offer for itsshares at RM1.25 a shares from West River Capital SB (WRC) and the jointofferors, which hold a 28.1% stake. TSM Global said on Monday it was not seekingan alternative offer following the voluntary general offer (VGO). Theacceptance deadline expired at 5pm on Monday after it was extended from 6April. To recap, WRC and the joint offerers ' Tzel Capital SB, KYM SB, CheongChan Holdings SB, Sierra Indah SB, Datuk Lim Kheng Yew, Lim Tze Thean andMelissa Lim Su Lin ' had made a takeover offer for TSM on 28 Feb. (StarBiz)

Malaysia's state investor Khazanah Nasional is expected tolist its healthcare assets here and in Singapore in the second half of theyear, a deal that could fetch USD1.5bn (RM4.6bn), said two sources with direct knowledgeof the deal. The dual listing could be the fourth-biggest initial publicoffering (IPO) in the city state's history and Malaysia's second-largest thisyear after the planned listing of plantation group Felda Global Venture Holdings.A source said the listing was  set forJune or July, with pre-marketing to start next month. Another  source said Khazanah was still makingacquisitions 'to bulk up the IPO'. (BT)

MMC-Gamuda Joint Venture SB is looking to subcontract 4km ofthe My Rapid Transit (MRT) tunneling works to foreign parties, said sources. Asource told The Edge Financial Daily that the consortium would subcontract a 4kmstretch of the total 9.5km MRT tunneling works to foreign firms and would alsolease the machines to them. The source said the subcontract would allowMMC-Gamuda to focus on the more challenging karstic limestone formation whichdominates the ground between Pavilion and the south portal at Maluri, Cheras.(Financial Daily)

The Securities Commission (SC) Malaysia has startedinvestigations into alleged financial irregularities at publicly listedornamental fish breeder Xian Leng Holdings. As reported earlier, troubles atXian Leng surfaced when a forensic audit by PricewaterhouseCoopers (PwC)Advisory Services founds that the company could not account for RM85.7m setaside to build ponds. PwC was engaged in October by Xian Leng to investigate allegedirregularities in capital expenditure incurred by its wholly-owned subsidiaryXian Leng Trading SB and Xian LengAcquatic (Kluang) SB, over a seven-yearperiod from 1 Feb 2011 to 31 Jan 2008. (Financial Daily)

India's central bank said price pressures must be restrainedeven as policy needs to shift to help growth, signaling that elevated inflationwill limit the magnitude of interest-rate cuts forecast. 'Monetary policy hasto recognize the need for keeping inflation expectations anchored in anenvironment of significant upside risks to inflation, while shifting thebalance of policy to arrest the deceleration in growth momentum,' the ReserveBank of India said yesterday in a review of the economy ahead of its ratedecision in Mumbai due today. (Bloomberg)

European officials travel to Washington this week seeking abigger global war chest to combat the debt crisis as Spain's government battlesto quell renewed market turmoil over its finances. Three weeks after European leadersunveiled emergency euro-area funding exceeding the symbolic USD1trn mark,concerns about Spain's position have ratcheted the nation's borrowing costs tothe highest levels this year. Crisis-fighting resources will dominate talks atthe International Monetary Fund's spring meeting in Washington from 20-22April. (Bloomberg)

Jim Yong Kim was chosen to be president of the World Bank,becoming the first physician and Asian-American to head the lender afteremerging markets failed to rally around a challenger to the US monopoly on thejob. The World Bank board of directors said it chose Dartmouth CollegePresident Kim to succeed Robert Zoellick, whose term ends 30 June. (Bloomberg)

Retail sales in the US rose more than forecast in March asAmericans snapped up everything from cars and furniture to clothes andelectronics. The 0.8% gain was almost three times as large as projected andfollowed a 1% advance in February, Commerce Department figures showed. Animproving job market is giving households confidence to sustain spending in theface of higher gasoline costs, boosting sales at chains such as Gap Inc. andTarget Corp. Strengthening consumer demand raises the odds that the world'slargest economy will weather a recession in Europe and slower growth in China.(Bloomberg)

The National Association of Home Builders/ Wells Fargo indexof builder confidence decreased to 25 this month from 28 in March, theWashington-based group said yesterday. Economists projected no change in theindex, according to the median forecast in a Bloomberg News survey. (Bloomberg)

Companies in the US increased inventories in February assales picked up, indicating factories will probably keep receiving orders asbusinesses rebuild stocks. The 0.6% rise followed a revised 0.8% advance theprior month, the Commerce Department reported yesterday in Washington. Themedian projection in a Bloomberg News survey called for a 0.6% gain. Salesclimbed 0.7% after a 0.4% gain in January. (Bloomberg)

Source: OSK188