Scientex's 1Q net profit doubles

KUALA LUMPUR (Dec 17): Scientex Bhd ( Valuation: 2.10, Fundamental: 2.10)'s net profit for the first quarter ended Oct 31, 2015 (1QFY16) jumped 101% to RM60.85 million from RM30.27 million a year ago on higher packaging product manufacturing revenue and property development income.

In its quarterly report to Bursa Malaysia today, Scientex said revenue for the quarter rose to RM550.6 million compared to RM431.07 million in 1QFY15.

Scientex said it registered "higher contribution from both the industrial and consumer packaging products as well as the contribution from the newly-acquired subsidiary SGW Ipoh".

The company said property revenue rose to RM158.6 million from RM110.8 million on contribution from its projects in Johor and Melaka.

Looking ahead, Scientex said it would focus on affordable housing to capitalise on resilient demand in the market segment.

"The group will also continue to implement better planning and deployment of resources to reduce operational costs and wastage to boost operational margins in light of rising cost pressure," Scientex said.

At 12.30pm today, Scientex shares rose 10 sen or 1.2% to RM8.70 on thin volume of 81,700 shares.

At the share price of RM8.70, the group has a market capitalisation of RM1.97 billion.

http://www.theedgemarkets.com/my/article/scientexs-1q-net-profit-doubles

Fed raises interest rates, citing ongoing US recovery

WASHINGTON: The Federal Reserve hiked interest rates for the first time in nearly a decade on Wednesday, signaling faith that the U.S. economy had largely overcome the wounds of the 2007-2009 financial crisis.

The U.S. central bank's policy-setting committee raised the range of its benchmark interest rate by a quarter of a percentage point to between 0.25 percent and 0.50 percent, ending a lengthy debate about whether the economy was strong enough to withstand higher borrowing costs.

"With the economy performing well and expected to continue to do so, the committee judges that a modest increase in the federal funds rate is appropriate," Fed Chair Janet Yellen said in a press conference after the rate decision was announced. "The economic recovery has clearly come a long way."

The Fed's policy statement noted the "considerable improvement" in the U.S. labor market, where the unemployment rate has fallen to 5 percent, and said policymakers are "reasonably confident" inflation will rise over the medium term to the Fed's 2 percent objective.

The central bank made clear the rate hike was a tentative beginning to a "gradual" tightening cycle, and that in deciding its next move it would put a premium on monitoring inflation, which remains mired below target.

"The process is likely to proceed gradually," Yellen said, a hint that further hikes will be slow in coming.

She added that policymakers were hoping for a slow rise in rates but one that will keep the Fed ahead of the curve as the economic recovery continues. "To keep the economy moving along the growth path it is on ... we would like to avoid a situation where we have left so much (monetary) accommodation in place for so long we have to tighten abruptly."

New economic projections from Fed policymakers were largely unchanged from September, with unemployment anticipated to fall to 4.7 percent next year and economic growth hitting 2.4 percent.

The Fed statement and its promise of a gradual path represented a compromise between policymakers who have been ready to raise rates for months and those who feel the economy is still at risk from weak inflation and slow global growth.

"The Fed is going out of its way to assure markets that, by embarking on a 'gradual' path, this will not be your traditional interest rate cycle," said Mohamed El-Erian, chief economic advisor at Allianz.

Fed officials said they were confident the situation was ripe for them to make a historic turn in policy without much disruption to financial markets, which had expected the hike this week.

U.S. stocks rallied on the news, in part because the Fed made clear it would proceed slowly with further tightening. Yields on U.S. Treasuries rose, while the dollar was largely unchanged against a basket of currencies. Oil prices fell sharply before paring losses.

http://www.thestar.com.my/business/business-news/2015/12/17/fed-raises-interest-rates-citing-ongoing-us-recovery/?style=biz

Fitch revises Malaysian banks' outlook in 2016 to negative

KUALA LUMPUR (Dec 16): Fitch Ratings has turned the sector outlook for Malaysian banks to negative in 2016, due to greater pressure on earnings and asset quality.

The rating agency said in a climate with persistently low commodity prices, weak external demand and lacklustre domestic sentiment, that it believes there is a risk to the country's gross domestic product (GDP) growth.

Fitch also sees some borrowers facing difficulty in adjusting to the significant currency depreciation over the past 12-18 months.

"We believe these developments translate into lower loan growth and higher credit costs in the next one to two years," it said in a report on "2016 Outlook: Asia-Pacific Banks" released today.

The agency also expects the recent rise in non-performing loan (NPL) formation to continue into 2016.

"The gross impaired-loan ratio — still steady at the long-term low of 1.6% at end-October 2015 — should increase, amid a more challenging environment.

"Delinquencies over the past 12-18 months have largely been from troubled industries offshore such as the commodity sector in Indonesia, but we expect deterioration in banks’ domestic portfolios to emerge in 2016," it said.

Fitch' rating outlooks, however, remain mostly stable, despite the more challenging sector outlook, on expectation that banks’ profitability and other loss-absorption buffers will provide a sufficient cushion against the projected rise in impairment costs, broadly preserving their credit profiles, amid the anticipated downturn.

Nevertheless, Fitch warned that the ratings would face downward pressure due to extended economic weakness, where significantly higher unemployment and a potential pull-back in lending would hurt banks’ asset quality, profitability and capitalisation.

"Exports and private domestic demand are the two largest drivers of the economy. Stronger global growth leading to more robust demand for Malaysia’s exports, or a convincing rebound in business and consumer sentiment — without excessive credit growth or inflation — would reduce the risks to GDP and banks’ asset quality," it noted.

http://www.theedgemarkets.com/my/article/fitch-revises-malaysian-banks-outlook-2016-negative

OCK bags job to build 920 telco towers in Myanmar

KUALA LUMPUR: Telecommunications network solution provider OCK Group Bhd ( Valuation: 0.80, Fundamental: 1.60), together with its Myanmar partner King Royal Technologies Co Ltd, intends to build up to 3,000 telecommunications towers in Myanmar over a five-year period.

For starters, OCK will invest US$75 million (RM323 million) to build 920 telecommunications towers for Telenor Myanmar Ltd, which will be delivered next year under a long-term “build and lease” business model.

In a statement yesterday, OCK said it and King Royal had signed a master service agreement with Telenor for the proposed project.

“With the Telenor contract, OCK is highly positive in achieving its [3,000 telecommunications towers] target,” said its group managing director Sam Ooi.

“As a progressive company, we seek to expand our services regionally, and Myanmar’s mobile phone industry has shown tremendous growth in the past year. This calls for more telecommunications towers both to cater for coverage and also for capacity,” said Ooi.

He pointed out that the Myanmar investment is part of the group’s mission in growing its recurring income. “We will continue to be on the lookout for more opportunities in the regional markets.”

Telenor Myanmar chief financial officer Lars Erik Tellmann said the company has built more than 4,000 telecommunications towers across Myanmar to date. “We see the clear need to expand our supply chain to secure and build sites, as [the] roll-out progresses from high-density urban areas and large townships to smaller towns, villages and rural areas,” he added.

Telenor is one of the companies that was awarded the nationwide telecommunications licence from the Myanmar government. It currently operates the largest 3G network in Myanmar, and aims to bring mobile voice and data connectivity to all cities, towns and villages across the country in the coming years.

http://www.theedgemarkets.com/my/article/ock-bags-job-build-920-telco-towers-myanmar

Stock With Momentum: NTPM Holdings

NTPM Holdings Bhd ( Valuation: 1.10, Fundamental: 1.30) (-ve)

SHARES of NTPM (Fundamental: 1.3/3, Valuation: 1.1/3) closed 11.5% higher at 87.5 sen yesterday on heavy volume. The stock has risen by 17.4% since announcing its 2QFYApril2016 earnings results on Monday.

For 2QFY2016, revenue rose 10.5% y-y to RM152.6 million, due mainly to 15.1% sales growth for personal care products. Net profit surged 85.3% to RM17.0 million, boosted by higher sales and better profit margins from both paper and personal care products.

Penang-based NTPM commands over 55% share of Malaysia’s tissue market and is best known for its popular Premier and Royal Gold brands. The company also produces personal care products such as sanitary products (Intimate), baby and adult diapers (Diapex), and cotton products (Premier). Tissue paper products account for 70% of its revenue with the remaining from personal care products.

NTPM intends to increase its presence in Indo-China, following completion of its RM80 million manufacturing facilities in Vietnam in FY2015.

http://www.theedgemarkets.com/my/article/stock-momentum-ntpm-holdings-0

Support Line

AJINOMOTO set a new record for the fourth straight session, which saw prices hitting a high of RM9.30 during intra-day session. The spike in the past few days had pushed the stochastic and the 14-day relative strength index deeper into the overbought area, suggesting correction may be around the corner. However, investors can consider accumulating on weakness, as the moving average convergence/divergence histogram remains positive. Initial support is seen at the RM8.53 level and the lower floor is anticipated at the RM7.97-RM8 band.

MALAYSIAN Resources Corp shares pulled back from a near one-year peak of RM1.52 on Nov 9 to a six-week low of RM1.20 owing to apparent profit-taking activity before bouncing off slightly amid light bargain-hunting interest. Based on the daily chart, this stock remains in short-term consolidation mode, and it will stay that way, as long as the falling 21-day simple moving average of RM1.29 continues to pressure prices. Important floor is at the RM1.15 level, of which a crack will see prices drifting lower towards the RM1.05 or 90 sen mark on extended correction process.

RENEWED buying interest lifted NTPM Holdings shares to a high of 88.5 sen during intra-day trading, the best since July last year. The stochastic and 14-day relative strength index strengthened further while the moving average convergence/divergence histogram climbed over the signal line to trigger a buy call yesterday. On the back of a promising development, prices are poised to firm in the immediate term. A breach of the 90-sen mark would lead to a re-test of the all-time peak of 97 sen, or open the windows for the bulls to explore unknown territory. Current support is envisaged at the 80-sen mark and concrete floor is seen at the 73-sen level.

The comments above do not represent a recommendation to buy or sell

- The Star Biz

NTPM RM0.785 @ 16/12/2015

NTPM: Quarterly Earnings Soared to New High!

Result Update

For QE31/10/2015, NTPM's net profit increased by 32% q-o-q or 85% y-o-y to RM17.0 million while revenue was increased by 6% q-o-q or 11% y-o-y to RM152.6 million. Profits rose due to the increase in sales and improvement in margin. Revenue increased y-o-y mainly due to the increase in sales of personal care products.

NTPM's net profit of RM17.0 million for QE31/10/2015 has surpassed the previous highest quarterly net profit of RM16.6 million recorded in QE31/1/2010.

Valuation

NTPM (closed at RM0.745 yesterday) is now trading at a PE of 14.6 times (based on last 4 quarters' EPS of 5.1 sen). At this PE multiple, NTPM is deemed fairly valued.

Technical Outlook

NTPM is in a long-term uptrend line, SS with support at RM0.68-0.70. Its immediate resistance is at the horizontal line at RM0.80. If it can surpass this resistance, it may go to RM0.90.

Conclusion

Based on satisfactory financial performance, fair valuation & positive technical outlook, NTPM's rating is upgraded from REDUCED to BUY.

http://nexttrade.blogspot.my/2015/12/ntpm-quarterly-earnings-soared-to-new.html

Topglove RM11.86 @ 16/12/2016

Topglov: Earnings soared!

Results Update

For QE30/11/2015, Topglov's net profit rose 24% q-o-q or 164% y-o-y to RM128 million on the back of a revenue which rose 13% q-o-q or 41% y-o-y to RM800 million. Revenue increased due to increase in sales volume of 15% y-o-y, largely attributed to nitrile glove sales which increased 54% compared with 1QFY15. PBT soared y-o-y due to increased levels of efficiency throughout the manufacturing process as a result of intense focus on automation, R&D and re-engineering, which led to enhanced quality output and substantially reduced downtime. The Group's bottom-line was also boosted by the strong US Dollar and lower raw material prices.

Valuation

Topglov (traded at RM11.90 as at 3.45pm) is now trading at a PE of 20.5 times (based on last 4 quarters' EPS of 58 sen). At this PE multiple, Topglov is fairly valued as compared to Harta & Kossan which are trading at their respective trailing PERs of 40 & 30 times..

Technical Outlook

Topglov is still in an uptrend. The current move may mirror the strong rally of 2009 when the stock rose 280% after surpassing the 20-month EMA line. If Topglov can chalk up a similar gain of 280% after surpassing the 20-month EMA line, then the potential target is RM14.00.

Conclusion

Based on satisfactory financial performance, fairly attractive valuation & positive technical outlook, Topglov is a good stock for long-term investment.

http://nexttrade.blogspot.my/

Stock With Momentum: Comfort Glove

GLOVE manufacturer Comfort (Fundamental: 2.1/3, Valuation: 0/3) triggered our momentum algorithm yesterday, closing 1.1% higher at 89 sen.

Last Friday, the company announced its 3QFYJan2016 results. Revenue rose 59.6% y-y to RM61.3 million while net profit surged more than 10-fold to RM7.2 million. The improved performance was mainly due to cost reduction initiatives and successful expansion plan carried out throughout this year.

Notably, Teo Soon Heng has ceased to be a substantial shareholder after disposing his stake in Keen Setup Sdn Bhd (KSSB) to Datin Goh Kim Kooi. KSSB is the second largest shareholder in the company with 68.5 million shares or a 13.8% stake, at the time of writing.

Perak-based Comfort is primarily involved in manufacturing and trading of latex gloves. Exports — mainly to Asia and the US — accounted for 88.8% of its FY2015 revenue.

Moving forward, the company has earmarked RM28.7 million for future expansion plans.

http://www.theedgemarkets.com/my/article/stock-momentum-comfort-glove

Datasonic bags RM318.75m contract from KDN

KUALA LUMPUR (Dec 15): Datasonic Group Bhd ( Valuation: 0.90, Fundamental: 1.75) has bagged a RM318.75 million contract from the Home Ministry (KDN) to supply Malaysian passport chips for a period of five years or 12.5 million of passport chips.

In a filing with Bursa Malaysia today, Datasonic said its wholly-owned subsidiary Datasonic Technologies Sdn Bhd (DTSB) has accepted the letter of award (LOA) from KDN for the proposed contract commencing from Dec 1, 2016 to Nov 30, 2021.

Under the terms of the LOA, DTSB is required to furnish a performance bond for RM3.19 million to KDN, with validity period commencing from Dec 1, 2016 to Nov 30, 2022.

"The contract is expected to contribute positively towards the future earnings and net assets per share of the group for the financial year ending March 31, 2016 and the financial years thereafter, for the duration of the contract and will not have any effect on the share capital and substantial shareholders’ shareholdings of Datasonic Group," said Datasonic.

As at 3.17pm, Datasonic shares were traded 13 sen or 8.6% higher at RM1.65, with 6.89 million shares exchanging hands, giving it a market capitalisation of RM2.05 billion.

http://www.theedgemarkets.com/my/article/datasonic-bags-rm31875m-contract-kdn

Rex’s stake in Lime Petroleum Norway rises to 98.8%

SINGAPORE (Dec 14): Rex International’s shareholding in Lime Petroleum Norway has risen to 98.77% from 74.16%, after a restructuring of the subsidiary’s capital.Lime Petroleum underwent a capital restructuring that cut its share capital to 80.32 million Norwegian krone ($13.1 million) from 382 million krone by accounting for 30.9 million krone of uncovered losses and transferring 270.8
million krone to other equity.

As part of the restructuring, 900,000 Lime Petroleum shares that were held by Rex were cancelled, and 77.4 million krone was repaid to Rex then subsequently fully reinvested back into Lime Petroleum for new shares. Rex says the restructuring gives the company an even larger stake in Lime Petroleum’s Norwegian assets.

Lime Petroleum has interests in 19 licences in the Norwegian continental shelf and has plans to drill at least three more wells in 2015 and 2016, Rex says.Rex shares last traded at 8.7 cents on Friday. — By PC Lee

- The Edge Market, Spore

Technical Stock To Watch - TEKSENG (7200)

http://fatta888.blogspot.my/

Support Line

EXCEL Force MSC set a new all-time high of 94.5 sen last Friday before reversing down owing to an apparent profit-taking activity yesterday. Apparently, the stochastic had issued a short-term sell signal at the overbought area. Combined with the curving down sign of the 14-day relative strength index from the top, they suggest more pullback on extended correction in the immediate term. Initial support is envisaged at the 78 sen-81 sen band and stronger floor is pegged at the 21-day simple moving average of 75 sen.

MANAGEPAY Systems shares rose to a 4½-month high of 30 sen last Thursday before slipping into range-bound consolidation mode in the wake of mild profit-taking selling. Technically, the weakening signal from the stochastic and the 14-day relative strength index suggest further correction but investors can consider accumulating more on weakness, as the moving average convergence/divergence histogram remains bullish. A clear penetration of the 32-sen barrier would lead the bulls up to the 36.5-sen level or to challenge the historical peak of 38.5 sen, set on April 25, last year. Support is lying at the 26-sen floor, followed closely by the 24-sen line.

PERSISTENT liquidation dragged Pos Malaysia shares to a low of RM2.64 during intra-day session, the worst since June 2012. The moving average convergence/divergence histogram is bearish, but the extreme oversold condition of the stochastic and the 14-day relative strength index offer a ray of hope of a relief rebound soon. Based on the daily chart, the prevailing trend is negative, as long as the declining 14-day simple moving average of RM3.25 continues to pressure prices. Current support is anticipated at the RM2.58 floor and the next, at the RM2.40-RM2.43 area.

The comments above do not represent a recommendation to buy or sell.

- The Star Biz

China economy shows signs of steadying, risks remain

China's activity data was stronger than expected in November, with factory output growth picking up to a five-month high, signalling that a flurry of stimulus measures from Beijing may have put a floor under a fragile economy.

Still, analysts believe more policy steps are needed to weather nagging headwinds from a cooling property market, risks from high domestic debt levels, and weak global demand as financial markets brace for interest rate rises by the U.S. Federal Reserve.

"Real interest rates are still high due to falling producer prices," Wang Jun, senior economist at the China Centre for International Economic Exchanges (CCIEE), a Beijing-based think-tank.

"It's still necessary to cut interest rates to support economic growth and combat deflation."

Factory output grew an annual 6.2 percent in November, data from the National Bureau of Statistics(NBS) showed, quickening from October's 5.6 percent and beating expectations of 5.6 percent.

Growth in China's fixed-asset investment, one of the main drivers of the economy, rose 10.2 percent in the first 11 months, unchanged from the gain in January-October, and higher than an expected 10.1 percent rise.

Retail sales grew an annual 11.2 percent in November - the strongest expansion this year - compared with 11.0 percent in October. Analysts had forecast 11.1 percent growth in November.

"While low base could be the factor driving the headline growth, we still have to acknowledge that China's data are illustrating signs of stabilization, albeit at a low level," said Zhao Hao, senior economist at Commerzbank in Singapore.

The data came after weak trade and inflation readings earlier this week, which underscored the persistent slack in the economy.

http://www.cnbc.com/2015/12/12/china-economy-shows-signs-of-steadying-risks-remain.html

Tq abang duit, wishing u merry xmas too & wonderful dec holidays.

Prolexus to set up Vietnam ops to gain from TPPA

KUALA LUMPUR: Prolexus Bhd is making a cash call to raise up to RM62.53mil in order to set up a garment factory in Vietnam as well as a fabric mill in Johor to expand into upstream garment production.

The apparels manufacturer announced to Bursa Malaysia on Friday a proposed renounceable rights issue of up to 62.53 million new 50 sen shares in the company -- at a price to be determined later -- together with the same number of free warrants.

This will be on the basis of one rights share and one warrant for every two existing Prolexus shares held by the company’s entitled shareholders on an entitlement date to be determined and announced later.

Of the proceeds, RM22mil is allocated for the Vietnam factory (land acquisition cost, however, will be paid with internal funds) while between RM31.85mil and RM38.93mil will be for the fabric mill.

Prolexus said the plant, to be constructed near the Tien Giang province in Vietnam, was part of its strategy to capitalise on the various benefits expected under the Trans-Pacific Partnership Agreement (TPPA).

http://www.thestar.com.my/business/business-news/2015/12/12/prolexus-to-set-up-plant-in-vietnam-to-gain-from-tppa/?style=biz

Comfort Gloves' 3Q profit up almost 11 times after expansion

KUALA LUMPUR (Dec 11): Comfort Gloves Bhd ( Valuation: 0.00, Fundamental: 2.10)'s performance in its third quarter ended Oct 31, 2015 (3QFY16) continued to show the fruits of its expansion exercise this year, when net profit came in almost 11 times higher year-on-year (y-o-y) at RM7.17 million from RM672,000 previously.

Revenue for the quarter under review rose 59.6% y-o-y to RM61.28 million from RM38.39 million, according to the company's Bursa Malaysia filing today. The company was formerly known as Integrated Rubber Corp Bhd.

"The contribution mainly resulted from (a) successful expansion plan that was carried out throughout this year," Comfort Gloves said in the explanatory notes accompanying its 3QFY16 financials.

The Perak-based glove maker also pointed out there was a quarter-on-quarter improvement in 3QFY16. In 2QFY16, Comfort Gloves netted RM4.98 million in profit on the back of RM57.34 million in revenue.

"In this quarter, the management concentrated on cost reduction in utilities and direct materials usage," the company said, noting its gross margin in 3QFY16 improved to 16.54% from the preceding quarter's 11.73%.

On a cumulative basis (9MFY16), Comfort Gloves' net profit rose a little over 10 times to RM16.26 million from RM1.59 million.

Its 9MFY16 revenue came in 51.2% higher y-o-y at RM171.2 million, from RM113.22 million previously.

Looking ahead, Comfort Gloves said it expects the demand and consumption of rubber gloves in Asia and other emerging economies to increase, on the back of rising awareness in healthcare.

As such, it expects it "will continue to capture a bigger market share in Asia and United States, which currently contribute 80% to [its] revenue".

Further, Comfort Gloves said its expansion plan will significantly improve its profitability as it did not anticipate any increase in its existing operating fixed costs, except for depreciation and maintenance expenses associated with the manufacturing facility.

"The group will maintain its strategy of developing bespoke gloves for specific uses," Comfort Gloves concluded.

Its stock has jumped 35.4% year to date to close at 88 sen today, valuing it at RM439.14 million.

http://www.theedgemarkets.com/my/article/comfort-gloves-3q-profit-almost-11-times-after-expansion

Stock With Momentum: Thong Guan Industries

SHARE price of Thong Guan (Fundamental: 2.5/3, Valuation: 1.4/3) continued to rise after announcing its 3Q2015 earnings results last month.  The stock, one of InsiderAsia’s Top 10 picks for 2015, has risen by 51.7% year-to-date, outperforming the KLCI by 58.1%.

For 3Q2015, net profit surged 129.0% y-y to RM11.3 million, boosted by higher margin export sales which are mainly denominated in USD. Revenue, meanwhile, declined 5.0% to RM182.3 million, largely due to lower selling prices, following decline in raw materials prices.

Kedah-based Thong Guan mainly manufactures plastic packaging, including cast pallet stretch film, garbage bags and PVC food wraps. The company is a beneficiary of the stronger USD as export accounted for 78.4% of its revenue in 2014.

The stock trades at a 22.6% discount to its book value of RM3.59. The company paid dividends consistently, since 2004. For 2014, dividends totalled 7 sen per share, giving a net yield of 2.5%.

http://www.theedgemarkets.com/my/article/stock-momentum-thong-guan-industries-0


Quarter Report Ending 30th September 2015

Prospect :

The Group's 33-layer nano technology stretch film line is expected to be commissioned by the end of 2015. Marketing efforts have commenced and order enquiries are promising. The group expects the nano-layer line and its R&D centre to play an important role to lead the group forward in its effort to move up the value chain.

The food,beverage and other consumable business unit is expected to continue its steady progress with consistent effort on marketing and promotional activities.The group's venture into the noodle business will see significant contribution upon completion of its manufacturing facilities expansion at a new production site which will be operational by the first quarter of 2016. This will be a new income stream for the food division.

The relatively low crude oil price has led to lower selling prices for plastic products which leads to higher demand.The depreciation of the Malaysian Ringgit against the USD will continue to benefit the Group in terms of lower labour,electricity and other input costs as the Group's sales are mostly denominated in USD.

Barring any unforeseen circumstances, the Group is confident of the continuous progressive contributions from its business units and has chartered further growth prospects.

Harbour-Link climbs 2.36% on multiple proposals

KUALA LUMPUR (Dec 11): Shares of integrated logistics provider Harbour-Link Group Bhd ( Valuation: 1.80, Fundamental: 1.70) climbed 2.36% on multiple proposals featuring a share split, a bonus issue and warrants it plans to execute in the second quarter of 2016 pending approvals.

At 10.40am, Harbour-Link rose seven sen to RM3.03 with 383,200 shares done for a market capitalisation of RM537.8 million.

Yesterday, Harbour-Link announced that it proposed a share split involving the subdivision of every one existing ordinary share of RM1 in the company into two new ordinary shares of 50 sen each.

It also proposed a bonus issue of up to 36.4 million new subdivided shares to be credited as fully paid-up on the basis of one bonus share for every 10 subdivided shares held by entitled shareholders on the entitlement date after the completion of the proposed share split.

In addition to that, Harbour-Link proposed a bonus issue of up to 36.4 million warrants in Harbour-Link on the basis of one warrant for every 10 subdivided shares.

http://www.theedgemarkets.com/my/article/harbour-link-climbs-236-multiple-proposals

Eco World Berhad - Better Than Expected

Period 4Q15/12M15

Actual vs. Expectations

12M15 earnings of RM44m made up 112% of consensus and 118% of our full year estimates. This was mainly due to stronger than expected billing in 4Q15 (refer overleaf) as most projects are in full swing construction mode.

12MFY15E sales of RM3.0b was spot-on, meeting both ours and managements FY15E target at 100%. Major drivers are from Klang Valley projects (52% of sales) such as Eco Majestic and Eco Sanctuary, while Johor (40% of sales) has been picking up steam with all projects, mainly, Eco Spring & Summer and Eco Tropics.

Dividends

None as expected.

Key Results Highlights

QoQ, earnings was up by a solid 110% to RM19.7m on a strong topline which was up by 50% to RM681.9m on strong sales recognitions and EBIT margin improvements by 2.0ppt to 5.7%.

YoY-Ytd comparisons are not reflective due to changes in FYE from September to October last year, rendering 12- month comparisons redundant.

Outlook

ECOWLD is still targeting an IPO listing of EWI via the market capitalisation route by 1QCY16. To recap, the IPO aims to raise RM2.0b while ECOWLD has formally announced expressed interest to take-up a 30% stake in EWI (refer overleaf). We also hope to see more concrete details on the acquisition of the Kuala Selangor land which will entail forming partnerships for funding.

The company remains confident of achieving its sales of RM4.0b in FY16E and has also introduced its FY17E sales target of RM4.5b (refer overleaf).

Change to Forecasts

Raising FY16E earnings by 11% largely due to billings and margin assumptions for local projects. We are also raising our FY16E sales from RM3.2b to RM4.0b as we build in a bigger pipeline of launches from EWI. However, note that EWI projects are recognized on completion i.e. no significant earnings impact over FY16-17E. Unbilled sales of RM4.16b provide 2 years visibility.

Rating

Maintain OUTPERFORM

Valuation

No changes to TP of RM1.90 based on 45% discount to FD RNAV of RM3.17. Our applied RNAV discount is more bullish than our sector coverage’s average of 50% due to the group’s aggressive expansion plans, reputable management team and positioning as a township developer which will benefit from resilient demand, while the group will be one of the rare few developers to show YoY growth in 2016 sales. The stock is poised to benefit from newsflow with EWI’s upcoming listing and more concrete details on the funding of avenue partnerships for landbanks like Kuala Selangor materializes.

Risks to Our Call

(i) Balance sheet risk. (ii) Weaker-than-expected property sales. (iii) Higher-than-expected sales and administrative cost. (iv) Negative real estate policies. Tighter lending environment. Delays in EWI listing.

Source: Kenanga Research - 11 Dec 2015

World-first dengue fever vaccine cleared for use in Mexico

PARIS: The first-ever vaccine against dengue fever, which affects up to 400 million people per year, has been cleared for use in Mexico, French manufacturer Sanofi said on Wednesday.

“It’s a very important moment in the history of public health,” Olivier Charmeil, head of the company’s vaccines division, told AFP, describing Dengvaxia as the “innovation of the decade”.

This vaccine could potentially become “a blockbuster” and generate more than a billion dollars in revenue for the French pharmaceutical company, Charmeil added.

It took 20 years and more than 1.5 billion euros ($1.6 billion) in research and development to create Dengvaxia.

Until now, scientists have been stumped by dengue which is caused by four separate viruses acting in concert.

The World Health Organization says dengue has become the fastest-growing mosquito-borne disease, with as many as 400 million people infected every year.

It can trigger a crippling fever, along with muscle and joint pain, and there is no known cure.

The deadliest form of the disease kills 22,000 people per year, the WHO says.

Over the past half-century, dengue has become endemic in more than 100 tropical and sub-tropical countries, thanks largely to rapid urbanisation.

Sanofi Pasteur has requested authorisation to push the vaccine in 20 countries.

“We are waiting for more registrations in Asia and Latin America in the coming weeks,” said Charmeil.

Several million doses of the vaccine are ready to ship, and Sanofi expects annual production to reach 100 million doses by 2017.

A stockpile for the European Union will be shipped in early 2016 and in the United States a year later.

Clinical tests — carried out on 40,000 people from 15 countries — have found Dengvaxia can immunise two-thirds of people aged nine years and older, rising to 93 percent for dengue hemorrhagic fever, reducing the risk of hospitalisation by 80 percent.

– AFP

Stock To Watch 10/12/2015 - Technical Analysis

1) FFHB @ 0.71
2) Eduspec @ 0.33
3) GHL @ 0.945
4) Tguan @ 2.78
5) Kawan @ 2.98

Renewed buying interest emerges in Kimlun, says AllianceDBS Research

KUALA LUMPUR (Dec 10): AllianceDBS Research said renewed buying interest had emerged in Kimlun Corporation Bhd (Kimlun) ( Valuation: 3.00, Fundamental: 1.70) and that Kimlun had on Dec 9 traded higher to RM1.45 before closing near the day’s high at RM1.44 (up 6 sen or 4.34%).

In ite evening edition yesterday, the reseach house said Kimlun continued to trade above the 20-day and 50-day moving average lines in the last 9 days.

“Following the up close on Dec 9, the stock is expected to move higher again with immediate hurdle at RM1.45 in the coming few days.

“A crossover of RM1.45 should see further price rise to the next overhead resistance zone, RM1.52 – RM1.55.

“The support is pegged at RM1.37. A fall below RM1.37 would put pressure on the stock down to the subsequent support zone, RM1.30 – RM1.33,” it said.

AllianceDBS Research said stock volume traded on Dec 9 was 1.26 million shares compared to the 3-month average volume of 220,000 shares.

The research house said that indicators wise, the MACD was above the 9-day moving average line with the buy signal remains intact.

It said the relative strength index indicated that the stock was currently in the neutral zone

Franklin Templeton: Malaysia may be among those not at risk when Fed rate hike comes

LONDON: An expected rise in U.S. interest rates will magnify differences between emerging economies in 2016, with South Korea, Mexico and Malaysia likely to prove resilient, said Franklin Templeton's star bond investor Michael Hasenstab.

Hasenstab, CIO, Templeton Global Macro, said countries such as Mexico were in a better position to raise interest rates alongside or shortly after the U.S. Federal Reserve, thanks to their relatively strong economic fundamentals.

"In our view, apprehensions about risks in places like Mexico, South Korea and Malaysia are likely to abate as these countries prove their resilience to Fed rate hikes," Hasenstab said in an emailed statement.

"However, countries with relatively weaker fundamentals, such as Turkey and South Africa, are likely to be negatively impacted by U.S. interest-rate hikes."

http://www.thestar.com.my/business/business-news/2015/12/09/franklin-templeton-hasenstab-fed-hike-to-widen-em-divergence/?style=biz

SUPERLN (7235), MAGNI (7087) & KAWAN (7216)

http://fatta888.blogspot.my/2015/12/superln-7235-magni-7087-kawan-7216.html

CLARIFICATION ON REX’S INTEREST IN MASIRAH OIL LTD

Unless otherwise defined, all capitalised terms used in this announcement shall bear the same meaning ascribed to them in the Company’s announcement dated 16 November 2015, in relation to the capital injection into Masirah Oil Ltd (“MOL”) (“Announcement”).

The Board of Directors (the “Board”) of the Company refers to Hibiscus Petroleum Berhad’s
(“Hibiscus”) quarterly results announcement for the financial period ended 30 September 2015,
published on Bursa Malaysia on 30 November 2015, and would like to reiterate the current
shareholding structure of MOL.

As set out in the Announcement, Lime Petroleum Plc's ("Lime") interest in MOL has changed from
64.0% to 6.4% with effect from 12 November 2015. In Hibiscus’ quarterly results announcement for
the financial period ended 30 September 2015, Hibiscus had not disclosed any changes to Lime
Petroleum Plc’s (“Lime”) interest in MOL.

In view of the above, the Company refers to its Announcement and wishes to reiterate its current
interests in MOL, Lime and Rex Oman:

- Rex Oman holds 57.60% direct interest in the enlarged issued and paid-up capital of MOL. Lime and Petroci hold the remaining 6.40% and 36.00% interests in the enlarged issued and paid-up share capital of MOL, respectively. The Company's effective interest in MOL has increased from 41.60% to 61.76%.
- Lime is a jointly controlled entity 65% indirectly held by the Company and 35% held by Gulf Hibiscus Petroleum Ltd, a wholly-owned subsidiary of Hibiscus.
- Rex Oman is a wholly-owned subsidiary of Rex International Holding Limited.

http://rex.listedcompany.com/newsroom/20151207_172209_5WH_KAZH890EHT2MXB78.1.pdf

Note : In yesterday's announcement to Bursa, Hibiscus is disputing the above claims by Rex

Eduspec partners Singapore's CM Asia Learnings

KUALA LUMPUR (Dec 8): Education provider, Eduspec Holdings Bhd ( Valuation: 0.80, Fundamental: 2.60) will grant an exclusive distribution rights of its education products to CM Asia Learnings Pte Ltd, after signing a master distribution agreement with the Singapore’s software solutions provider.

Additionally, Eduspec will acquire a 19.35% stakes of CM Asia, upon execution of the agreement.

In a filing with Bursa Malaysia, Eduspec said it had on Dec 7, signed the agreement with CM Asia, whereby the company grants an exclusive distribution rights within the designated markets and the right to appoint resellers or distributor to distribute Science Technology Engineering Mathematics (STEM) Education Using Robotics, Stem Computer Science For Schools Program (STEM CS) and Software Development Program (SDP) to CM Asia.

A cash deposit of US$1 million or SGD1.4 million will be paid to Eduspec, within 10 days from the effective date of the agreement.

Eduspec opined the agreement is to enhance the development of the market and increase the sales of its products in the designated markets, through cooperation with CM Asia, which has processed a readily available sales network in the territory.

The agreement will contribute positively to the future earnings of the Eduspec, it said.  

Eduspec was unchanged at 31 sen today, valuing it at RM262.2 million.

http://www.theedgemarkets.com/my/article/eduspec-partners-singapores-cm-asia-learnings

Consumers to pay more for electricity starting January

PUTRAJAYA (Dec 8): Consumers in Peninsular Malaysia will pay 0.73 sen per kilowatt hour (kWh) more for electricity for the next six months, beginning Jan 1, as the government reduces the rebate on power tariff to 1.52 sen per kWh, from 2.25 sen per kWh currently.

Energy, Green Technology and Water Minister Datuk Seri Maximus Ongkili said the rebate for electricity users in Sabah and Labuan will remain the same at 1.20 sen per kWh.

"The savings in fuel and other generation costs amounted to RM762.03 million for July to December 2015," Ongkili told a press conference today.

"The savings were from the decrease of liquefied natural gas prices and the increased efficiencies of power plants," he added.

http://www.theedgemarkets.com/my/article/consumers-pay-more-electricity-starting-january

Technical Stocks To Watch on 8/12/2015 – TGUAN (7034), SUCCESS (7207), EKIB (7189), FUTUTEC (7161) & TOMYPAK (7285)

http://fatta888.blogspot.my/

Support Line

GENETEC Technology shares scaled to a high of 31.5 sen during intra-day session, the best since July 2010, amid persistent bargain hunting buying. Apparently, the stochastic and the 14-day relative strength index were fast approaching the overbought area, implying the bulls may pause for air soon, with prices approaching the pretty stiff resistance of 33.5 sen and the heavy barrier of 36.5 sen, which is a historical peak set on mid-March 2010. If the bulls stop for a breather, investors can consider accumulating more, as other indicators still are positive. Initial support is seen at 29 sen, followed closely by the 14-day simple moving average of 26.5 sen.

KOBAY Technology pulled back from a steep rally peak of RM2.74 on Nov 18, the highest level since January 2002 to a low of RM2.02 late last month before bouncing off in the wake of fresh buying momentum. The trend ahead is simple. A breach of an initial resistance of RM2.45 would lead to a re-test of the recent high of RM2.74, of which a decisive breakout will signal an uptrend continuation, enroute to the RM2.95-RM3 band. On the opposite, a crack of the RM2 floor is likely to see the lower 50-day simple moving average of RM1.69 becoming vulnerable.

OPENSYS has been trapped inside a symmetrical triangle since peaking out temporarily at a 10-year high of 36.5 sen on Aug 5, last year. A positive breakout of the 33 sen would signal an uptrend continuation, enroute to the 42-sen level or the 47-sen hurdle and probably a re-test of the all-time high of 67.5 sen later. In stark contrast, a negative breakdown from the 26-sen line is likely to witness prices falling on renewed selling pressure.

- The Star Biz

Malaysia's October exports surge to RM75.8b, highest since January last year

KUALA LUMPUR: Malaysia's exports surged to RM75.8bil in October, 2015 - the highest since January last year - underpinned by the robust demand from major markets including Asean, China, the EU and the US, the Ministry of International Trade and Industry (MITI) said on Friday.

It said exports jumped 16.7% from RM64.59bil a year ago and exceeding economists expectations of a 8.4% increase. The rise in exports were mainly to China (+RM1.9bil), EU (+RM1.7bil), US (+RM1.7bil), Singapore (+RM1.1bil), and Australia (+RM789.2mil).

On a month-on-month basis, exports increased RM5.6 billion (+8.1%) from RM70.2 billion. In seasonally adjusted terms, exports rose 4.9%.

For the January to October, exports expanded by 1.5% to RM644.02bil from RM634.46bil in the previous corresponding period. The trade surplus rose 21.5% to RM76.07bil.

MITI said total trade rose 8.2% to RM139.46bil while trade surplus rose from RM1.08bil in October 2014 to RM12.16bil, making it the 216th consecutive months of trade surplus since November 1997.

Imports were slightly lower at RM63.65bil, down 0.4% from RM64.98bil a year ago.

On a on-year basis, higher imports were recorded with China (+RM1.7bil),  US (+RM1.2bil), Taiwan (+RM906.4mil), Thailand (+RM728.1mil) and EU (+RM695.8mil).

The main commodities which contributed to the rise in exports in October from a year ago were electrical and electronics (E&E) products, which contributed 34.6% to total exports, increased 22.7% or RM4.9bil to RM26.2bil.

Timber and timber-based products, which accounted for 2.8% of total exports, expanded RM468.3mil or 28.5% to RM2.1bil.

Palm oil and palm-based products, which contributed 8.1% to total exports, recorded a growth of RM330.4mil (+5.7%) to RM6.2bil. Exports of palm oil, the major commodity in this group of products increased 3.9% or RM146.1mil due to the increase in export volume (+7.7%) although average unit value fell 3.6%.

Natural rubber (0.4% of total exports), recorded an increase of RM34.1mil (+11.6%) to RM329.3mil due to the growth in both average unit value (+10.1%) and export volume (+1.3%).

http://www.thestar.com.my/business/business-news/2015/12/04/malaysia-exports-surge/?style=biz

Stone Master all set for vendor financing

Marble and granite trader has RM3.1bil worth of deals with property developers under the scheme

STONE Master Corp Bhd, a manufacturer and trader of marble and granite products, is creating ripples in the property development market.

Over the last four weeks, it has entered into framework agreements (FA) with major property developers in Malaysia to provide them with “interest-free vendor financing services”.

What is interesting is that within this short period of time, the total amount of vendor financing that it has agreed to provide now stands at a whopping RM3.1bil and counting. Stone Master is still in the process of entering into many more such agreements, sources say.

Stone Master is offering building-finishing material products and services to Malaysian property developers on vendor financing schemes that require a repayment only after the developer has completed the projects. Stone Master has tied up with a number of China companies to provide its building-finishing material products and services under this scheme.

And coupled with the trade financing offering, it is clear that Stone Master is acting as an agent to the Chinese parties coming into the Malaysian market and collecting fees from providing this service.

http://www.thestar.com.my/business/business-news/2015/12/05/stone-master-creating-ripples-in-property-stone-master-all-set-for-vendor-financing/?style=biz

Green Packet enters a new era

THE OSK Group, a long-standing substantial shareholder in Green Packet Bhd has exited the group, sources say.

Off market trades show that a block of 109 million Green Packet shares crossed hands at a price of 30 sen a piece yesterday afternoon.

Sources say it is OSK Technology Ventures Sdn Bhd which sold its entire stake in Green Packet.

The buyers of the block are split between parties linked to Green Packet’s founder Puan Chuan Cheong (pic) (better known as C.C. Puan) and another group from China. The latter’s entry could also mark a new business direction for Green Packet. Sources say the Chinese party is a listed-entity in China which is involved in the mobile payment and e-commerce payment sector. “That could be Green Packet’s next wave of growth,” a source says.

Green Packet was among the most traded stocks of the day. It ended the day up 1.5 sen to 29 sen. The stock is down 3 sen or 10% on a year-to-date basis.

The largest shareholder of Green Packet is Puan via his vehicle Green Packet Holdings Ltd. He holds 20.56% or 141 million shares.

http://www.thestar.com.my/business/business-news/2015/12/05/green-packet-enters-a-new-era/?style=biz

Kawan Food on a roll with strong US dollar

WHILE the after-effects of recession in 2010 had left many fast-moving consumer goods (FMCG) companies hurt and looking for ways to cut costs, the weaker ringgit against the US dollar is certainly proving to be exciting for food manufacturer Kawan Food Bhd.

The strength of the US dollar is somewhat stirring up investors’ craving for the frozen food producer that exports most of its products with sales mostly denominated in the currency.

Since the lowest closing price on Sept 21 at RM2.37, the company’s share price surged 24.5% to close at RM2.95 yesterday. The company is worth RM607mil now.

http://www.thestar.com.my/business/business-news/2015/12/05/kawan-food-on-a-roll-with-strong-us-dollar/?style=biz

Eye on stock: Green Packet Bhd

AFTER dropping to an all-time low of 18.5 sen on July 14 amid extended correction process, Green Packet Bhd (G-Packet) staged a steep rally, pushing prices to a high of 29.5 sen on August 4.

However, the upward momentum was short-lived, as the bulls could not attract follow-through support. Consequently, G-Packet shares came under the pressure to retreat, but just when it looked frail and risked setting a new ebb, a fresh bout of buying interest emerged from the sidelines. This led to a rebound, up from the 19 sen level to reach a high of 29 sen during intra-day session yesterday. G-Packet has been on the upward momentum the past four months. Unlike the previous steep climb, which punctured eventually, this time around it was more consistent albeit on a gradual pace, with investors continuing to indulge in bargain hunting interest. Based on the daily chart, the stock had already penetrated the mid-term bearish descending line recently and they are now on the way to challenge the 29.5 sen-30 sen band. A breach of the band would propel the bulls to challenge the longer-term descending trend line of 45 sen, of which a major breakout would see the fate of this counter changing for the better going forward.

Elsewhere, the oscillator per cent K curved up from the mid-range and crossed over the oscillator per cent D of the daily slow-stochastic momentum index to trigger a short-term buy yesterday. The past week witnessed the 14-day relative strength index retracing back to a reading of 52 in mid-week before curving up to settle at the 64 points yesterday.

In addition, the daily moving average convergence/divergence histogram resumed the positive expansion against the daily signal line to keep to bullish note.

It had issued a buy on Nov 18. Technically, indicators suggest a steadier trend in the short-term. Combined with the pretty encouraging trading volumes, G-Packet has the potential to turnaround. As for the downside, initial support is resting at the 26.5-sen floor, followed closely by the 25-sen mark and the 24-sen level, also the 200-day and 50-day simple moving average lines respectively. – By K.M. Lee

http://www.thestar.com.my/business/business-news/2015/12/05/eye-on-stock/?style=biz

World Bank expects 4.7% growth for Malaysia this year

KUALA LUMPUR: The World Bank expects Malaysia to record 4.7% growth this year and close to 4.2% in 2016 before gradually rising again in 2017, said its chief economist (East Asia and Pacific Region) Sudhir Shetty.

http://www.thestar.com.my/business/business-news/2015/12/04/world-bank-expects-almost-5pc-growth-for-malaysia-this-year/?style=biz

Stock With Momentum: CCK Consolidated Holdings

CCK Consolidated Holdings Bhd ( Valuation: 1.40, Fundamental: 1.00) (-ve)

CCK (Fundamental: 1/3, Valuation: 1.4/3) triggered our momentum algorithm for the first time yesterday. The stock has risen by 11.9% to close at 84.5 sen since announcing its 3Q2015 results last Friday.

For 3Q2015, net profit surged 67.1% y-y to RM3.9 million while revenue grew 10.5% to RM135.7 million, mainly due to higher business volume from new stores/outlets. The seafood division also recorded better performance.

Kuching-based CCK is mainly involved in the retail of cold storage products and the production of poultry products, mainly in Sarawak. These divisions accounted for 74.7% and 19.4% of revenue in FY2014, respectively. The company also produces prawn and seafood products. Export, mainly to Indonesia, accounted for 8.8% of revenue in 2014.

The stock trades at a trailing P/E of 12.3 times and 0.8 times book. The company has consistently paid dividends, since 2002. Dividends totaled 2 sen per share for 2014, giving a yield of 2.4%.

http://www.theedgemarkets.com/my/article/stock-momentum-cck-consolidated-holdings

Technical Stocks To Watch on 4/12/2015 – EFFICEN (0064), COMFORT (2127), ECOWLD (8206), SUPERLN (7235), KAWAN (7216) & YEELEE (5584)

http://fatta888.blogspot.my/

Support Line

ASDION

ASDION fell from the recent minor rally peak of 76 sen on Oct 27 to a 1½-month low of 37 sen on Nov 25 amid extended correction before bouncing off slightly to achieve a high of 43.5 sen during intra-day trading amid fresh bargain hunting interest. Apparently, the moving average convergence/divergence histogram is seen improving while the stochastic momentum index and the 14-day relative strength index curve up from the oversold area, implying prices are set to firm in the short-term. A clear breakout of the 50-day simple moving average of 50 sen will clear the way for more scaling, enroute to the 65 sen mark or 80 sen barrier. Solid support is pegged at the 30 sen floor.

CHEE Wah Corp

CHEE Wah Corp tested the heavy resistance of RM1.50 last Friday, the best level since July 2000, before reversing down owing to an apparent profit-taking selling. Technically, the daily moving average convergence/divergence histogram remains the buy call, suggesting investors can consider accumulating more on weakness. A breach of the recent high of RM1.50 line would propel prices up to the RM1.75-RM1.80 band. The next upper hurdle is expected at the RM2 mark while initial support is resting at the RM1.25 line, followed closely by the RM1.15 level.

DATASONIC Group

DATASONIC Group rose to a one-year high of RM1.68 on Nov 25 before turning range-bound undergoing a healthy consolidation. The trend ahead is simple. A successful penetration of the RM1.68 would signal an uptrend continuation, targeting the RM1.80 mark, or the RM2-RM2.06 band. On the opposite, a breakdown from the RM1.55 floor will see prices drifting lower towards the RM1.32-RM1.35 area on correction.

- Star Biz


The comments above do not represent a recommendation to buy or sell.

SKP Resources Berhad - Results As Espected, TP RM2.00

Review


-SKP Resources reported its 1HFY16 results of RM36.3mn (+2.9% QoQ,
+80.0% YoY). This was within ours and consensus expectations at 40.0%
and 38.9% respectively.


-It was another consistent quarter for the company. QoQ, there were no
major developments as earnings remained flat. Everything remains on
track. We are expecting a better second half, driven by the production of cordless vacuum cleaners for Dyson.


-YTD, the surge in net profit was mainly attributed to the consolidation of its results with Tecnic’s subsidiaries. Results also included the production of two new Dyson products, the bladeless fan and vacuum cleaner, which began in 3QFY15. Net profit margins were stable at 7.2%.

Impact


-Leave our earnings estimates unchanged.

Outlook


-Earnings will be driven by its fifth factory, which houses 20 assembly lines vs. 3 assembly lines at existing facilities. It has secured two separate contracts for the production of cordless vacuum cleaners, totalling RM1.0bn from Dyson. Cordless vacuum cleaners are among the fastest growing products for Dyson. Commencement of these contracts are expected to begin in the 2HFY16. As everything remains on track, we expect the group’s performance to pick up in the second half.

Valuation

-We value SKP at an unchanged TP of RM2.00/share – based on a PE of 18x
and CY16EPS of 11.0sen. BUY. Key buying points are: 1) Strong earnings
growth with a three year CAGR of 68.2% YoY; 2) Decent future dividend
yields of 4.4-5.7% and 3) Potential for further contract awards given
available capacity at new factory.

- TA Securities

SKP Resources - Momentum Building @ RM1.37 TP RM1.71 by Public Invest

SKP’s 2QFY16 net profit of RM18.4m (+74.9% YoY, +2.9% QoQ) contributing to a cumulative net profit of RM36.3m (+80.0% YoY) for 1HFY16 met only 39% of our and consensus estimates. While seemingly short, we view the results broadly in-line with expectations as we see increased contributions from its recently-secured RM400m (announced in May) and RM600m (announced in September) per annum contracts and a gradual pick-up in existing orders in the subsequent quarters to deliver our full-year estimates. Our Outperform call is retained with an unchanged PE-derived target price of RM1.71 premised on a 15x PE multiple to FY17 EPS, the higher multiple justified given the anticipated growth spurt in the coming few financial years underpinned by the expected increase in orders from its key existing clients.

•2QFY16 Revenue (+84.4% YoY, +7.5% QoQ), Net Profit (+74.9% YoY, +2.9% QoQ). The robust revenue and profit growth are reflective of the company securing more work orders from its existing customers during the year. The slight decline in net profit margins this current quarter is not of particular worry as we view this more of timing differences in the passing on of its raw materials costs (particularly resin, owing to the stronger USD) rather than a systemic issue in itself. While susceptible to fluctuations in the interim, net profit margins should normalize to average c. 7.5%-7.8% over the longer-term however. We also see the significant levels of growth in the coming financial years to mitigate any potential margin erosions from raw material cost pressures from greater economies of scale.

•Symbiotic partnership. Growth in Dyson augurs well for SKP. 2014 saw record profits of £367m being announced on the back of an £1.4bn revenue, with more than 90% of its products now sold outside the UK. Of greater interest is the 68% sales growth last year which it saw on its cordless product, one which SKP is very much involved in and has recently secured huge contracts for over the next 5 years.

•Interest still strong. Despite the share price having appreciated 58% since our initiation in April this year, we still see value at current levels. Recent secondary placement of 55m shares over the last 5 months at an average price of RM1.48 per share to various parties is reflective of this. Our Outperform call is retained with an unchanged PE-derived target price of RM1.71 premised on a 15x PE multiple to FY17 EPS.

Source: PublicInvest Research - 30 Nov 2015

MY E.G. Services @ RM3.51 dd 27/11/2015 TP upgraded by CIMB to RM5.67 from RM3.92

FWPR is an earnings booster

■ We deem 1QFY06/16 net profit in line with our expectations, as 1Q is a seasonally weak quarter. 1QFY16 net profit comprised 15% of our full-year forecast.

■ Nationwide foreign workers permit renewal (FWPR) services are running smoothly.
We expect this to be MyEG’s main earnings contributor in FY16.

■ MyEG will maintain a database of foreign workers in the country on behalf of the government.

■ Maintain Add. We raise our target price to RM5.67, as we roll over to end-2016.

1QFY16 net profit up 132% yoy MyEG’s 1QFY16 revenue was up 119% yoy, mainly due to the higher contribution from FWPR services. 1QFY16 net profit growth was higher at 132% yoy, likely due to greater economies of scale. No interim DPS was declared, in line with our expectations.

FWPR to start contributing in a big way in FY16 In our view, MyEG’s FWPR services will start to contribute significant earnings this financial year. In May 2015, the government announced that it would pay the employers’ MyEG online FWPR processing fees of RM35 per foreign worker and all employers to use the FWPR. In addition, MyEG earns additional revenue of RM70 per foreign worker from the sale of compulsory foreign worker’s insurance annually. There are currently 2.5m legal foreign workers in the country and we believe around 5m illegals. MyEG to track foreign workers The government has appointed MyEG to set up and maintain a database of foreign workers in the country. MyEG would be able to effectively maintain the database by using FWPR services.

MyCC issue likely resolved In Oct 2015, the Malaysia Competition Commission (MyCC) proposed to impose a financial penalty on MyEG for abusing its dominant position in the provision and management of FWPR applications. This should no longer be an issue, as MyEG has
opened this gateway to other insurance companies. Most of the other insurance companies now have a presence on this gateway.

Custom service tax monitoring system to start later We expect the custom service tax monitoring system (CSTM) project to be launched in
mid-2016 or earlier. The company decided to postpone the CSTM launch, as it would be a stretch for management to handle the registration of illegals and CSTM at the same time. CTSM Phase 1 targets the food and beverage (F&B) sector and around 50,000 outlets nationwide would come under the CSTM.

Maintain Add, target price raised
We maintain our FY16-18 EPS forecasts but raise our target price as we roll over to CY17 21x, in-line with peers. The stock remains an Add, with the registration of illegal foreign workers and successful launch of the CSTM as potential re-rating catalysts.

- CIMB Research

Kawan @ RM2.80 dd 26/11/2015 TP upgraded to RM4.48 from RM3.65 by CIMB

Posted by Kawan Tsong > Nov 27, 2015 12:28 AM | Report Abuse

好朋友，出外靠朋友
朋友一升一起走，那些便宜日子不再有。。

CIMB New TP 4.48
Kawan Food
Best quarter ever

-9M net profit results were above our expectations mainly due to huge 3Q15 forex gains. 9MFY15 net profit met 95% of our full-year forecast.

-3QFY15 forex gains of RM4.8m were due to stronger US$. 9M15 forex gains stood at RM7.2m.

-New factory should be up by 1Q2016. Kawan can offer new products from new factory.

-Maintain Add. As we raise our FY15-16 EPS by 14-37% and roll over our P/E valuation to end-2016, our target price rises to RM4.48.

9M15 net profit up 64% yoy
9MFY15 revenue was up 10% yoy but net profit skyrocketed 64% to RM25.1m. The higher profit growth was mainly due to lower raw material costs and the stronger US$. 70% of Kawan’s revenue are exported, with the US being its biggest export market. No interim dividend was declared, in line with our expectations.

3Q15 the best quarter ever
3Q15 was the best quarter ever for Kawan. 3Q net profit came in at RM12.2m, aided by forex gains of RM4.8m in just this quarter. 9M15 forex gains came in at RM7.2m, compared to forex gains of only RM0.5m in 9M04.

Domestic sales were flat
The domestic market was the largest revenue contributor in 9MFY15, but revenue inched down 0.9% yoy. This is one of the rare few times where domestic revenue slid. Even during the 2008-2009 global financial crisis, domestic sales were up yoy. North America, the second-largest market, saw sales rise by 20% yoy to RM39.9m in 9MFY15. Europe posted the fastest growth in 9MFY15, with sales rising by 24% yoy.

New plant target to be ready by end-1Q16
Kawan is building a new factory in Pulau Indah, Selangor, which will be 5-6x the size of the existing freezer warehouse. Expected to be up and running by end-1Q16, the new factory and production line will allow the company to develop new products and target new markets. Its existing plant is already running at full capacity.

Net cash balance sheet
Kawan's balance sheet is healthy, with net cash of RM33m as at end-Sep. Its existing cash pile and proceeds from warrants (RM20m thus far in 9M15) should help fund most of the new factory's capex.

Maintain Add, target price raised
We raise our FY15-16 EPS by 14-37% to reflect forex gains and lower raw material costs. Our target price rises, as we roll it forward to end-2016, with the target P/E basis unchanged at 20x, a 25% discount to our F&B sector P/E of 25x. The stock remains an Add. Potential catalysts include successful completion of its new factory and strong export sales.

Malaysia's OCK spreading wings in Myanmar

PETALING JAYA: Telecommunications network services provider OCK Group Bhd is in the final stages of getting a contract from Telenor’s Myanmar unit to build and lease over 900 towers in the country.

Sources told StarBiz that the contract would last for 12 years and all the towers under this phase were expected to be completed next year. “They are targeting to seal the deal by next month,” a person with knowledge of the matter said.

Norwegian telecommunications provider Telenor commands a 36% market share in Myanmar, with the other operators in the country being MPT and Ooredoo.

The company said in a statement that it had entered into a memorandum of understanding with Telenor Myanmar alongside local partner King Royal Technologies yesterday.

Meanwhile, the company’s revenue for the third quarter ended Sept 30 rose 75% to RM83.7mil year-on-year (y-o-y), mainly due to higher contribution from its core telecommunication network services.

In tandem with the hike in the topline, its bottomline rose by 62.5% to RM4.89mil y-o-y.

The segment, which made up 84% of its topline, surged by 87% from the previous corresponding quarter.

“The substantial higher revenue from telecommunication network services was due to contribution from its regional business in Indonesia, Cambodia, Myanmar and China, as well as significantly higher contribution from a subsidiary undertaking site maintenance works in Malaysia and the distribution of telecommunication equipment in Malaysia,” the company said in a filing with Bursa Malaysia.

Group managing director Sam Ooi said the company’s strategy to strengthen recurring income and expand regionally had been effective. “More than 15% of our revenue now comes from regional markets, from merely 5% last year. We are continuously looking out for more opportunities in these regional markets,” he said in the statement.

It manages more than 24,000 telecom sites in Indonesia and Malaysia now.

For the first nine months, revenue rose 64% to RM210mil compared with a year ago.

Net profit for the period jumped 44.6% to RM13.09mil from RM9.05mil last year.

The green energy and power solution business was the second-largest income contributor, making up 7% of revenue.

“OCK will continue to participate via the feed-in tariff programme, whereby the Sustainable Energy Development Authority Malaysia will continue to release annual quotas for solar energy,” it noted.

The company’s solar plants, through direct ownership and partnerships with licence owners, produce 2.15MW of solar energy.

- The Star Biz

Stocks To Watch on 26/11/2015 - DSONIC (5216)

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Eita @RM1.12 - A Hidden Gem

http://www.eita.com.my/

Support Line

YSP shares bounced to a three-week high of RM2.70 amid fresh bargain hunting buying. Technically, the buy signal on the moving average convergence/divergence histogram suggests a steadier trend ahead.

A breach of the immediate resistance of RM2.80 would drive prices up to the RM3 mark, of which a positive breakout is likely to clear the way for the bulls to revisit the historical peak of RM3.49, established on July 24. Solid support is pegged at the RM2.18 level.

- The Star Biz

IFCA ventures into e-commerce

PETALING JAYA: IFCA MSC Bhd, which has long been synonymous with being a software provider, is set to enter the e-commerce space with the launch of a new portal called property365.my (P365).

Chairman and chief executive officer Ken Yong said the portal, which would seek to aggregate all the new launches of major property players here, would allow its users to search for these properties and complete an entire property buying process online.

Real-time information such as how many units have been sold and how many are still available for a specific new launch can also be easily obtained.

According to Yong, the portal, to be launched early next month, is the first of its kind in Malaysia.

“The barriers to entry in doing something like this are very high but much easier for us, as we are already well-versed on the main IT systems of these developers since they have been our clients for so long,” Yong told StarBiz.

Notably, IFCA has a major foothold in the local property sector, supplying software to almost 80% of the entire market. It counts among its clients the big boys of the property industry such as S P Setia Bhd, Mah Sing Group Bhd and the Sunway Group.

According to Yong, IFCA will derive earnings of between 1% and 5% from the value of each property sold, as well as obtain a subscription fee from the developers who use the portal to list their properties.

“You should be able to see the earnings starting to come in by the first quarter of next year,” Yong said.

He said to-date, IFCA had already secured some RM500mil in gross development value (GDV) inventory (new launches) from two developers, and had a target to grow this to RM2bil before the portal is officially launched, possibly in the first or second week of December.

CIMB Research analyst Nigel Foo, who tracks the stock, said assuming IFCA can sell RM2bil GDV through P365 next year, and at a 2% commission rate, its revenue would be around RM40mil from this business alone.

“And assuming a 50%-60% net profit margin, this could boost its net profit by RM20mil to RM24mil, a 45% to 55% 2016 earnings per share enhancement,” Foo pointed out.

Up to the nine months ended Sept 30, IFCA’S net profit stood at RM21.2mil, 77% higher than the net profit of some RM12mil for the same period earlier.

Revenue for the period, meanwhile, was RM78.5mil compared with RM58mil a year ago.

Foo, who has a target price of RM1.80 for IFCA, said the stock could be in for a re-rating, pending a successful launch of P365 as well as a further recovery in the China property market, from which IFCA derived up to 45% of its revenue in the last financial year,

Yong said, for now, the portal would focus on business in Malaysia, as the Chinese market was “simply too big” for something like this.

IFCA shares last traded at 95 sen apiece, giving the company a market capitalisation of some RM533mil.

- The Star Biz

GHL Systems core earnings below CIMB Research forecast

KUALA LUMPUR: CIMB Equities Research said GHL System’s annualised 9M15 core net profit, which was at 81% of its FY15 forecast and 83% of consensus.

The research house said on Thursday the main reason was due to the higher tax rate and merchant acquisition cost faced by the card payments solutions provider.

“The 9M15 core net profit rose 30.7% on-year, driven by higher shared services revenue and transaction payment acquisition (TPA) contribution from e-pay and card TPA,” it said.

However, CIMB Research expects better earnings in 4Q, driven by merchant addition in Malaysia and stronger contribution from the Philippines following the new TPA implementation.

It cut the FY15-17 EPS by 15%-20% to account for higher effective tax rate and acquisition cost.

“Maintain Add with a lower RM1.40 target price (23 times CY17 P/E). Stronger TPA earnings and M&As in new markets are potential re-rating catalysts,” it said.

CIMB Research said while the Philippines market only accounted for 11.2% of the group’s 9M15 revenue, management expects it to be the fastest growth driver for the group, with the implementation of TPA services for two telcos and a banking partner in 4Q15.

It viewed the Philippines as an attractive growth market for GHL, given that it offers the higher merchant discount rates (MDR) compared to Malaysia due to the lack of competition in the payment service provider space.
Overall, the research house thinks that GHL’s earnings growth prospects are intact and it is still confident about the execution strategy despite the teething issues

Evergreen Fibreboard's first ever private placement oversubscribed

KUALA LUMPUR (Nov 25): Wood-based products manufacturer Evergreen Fibreboard Bhd ( Valuation: 0.30, Fundamental: 1.00)'s maiden private placement exercise was oversubscribed with strong demand from institutional and high net-worth investors.

In a statement today, the group said the 51.29 million new placement shares, which represented approximately 10% of its existing issued and paid-up capital, were priced at RM2.05 per placement share.

"All placees have been identified, the issue price of RM2.05 represents a discount of 4.8% to the five-day volume weighted average price of Evergreen shares up to and including Nov 20, 2015. Based on the issue price, the group is expected to raise gross proceeds of RM105.14 million," read its statement.

Evergreen group chief operating officer and executive director Kuo Jen Chiu said that the group is extremely pleased with the market demand for its shares, notwithstanding that this is the group's first placement exercise.

"This is our first placement exercise as a 10-year-old public listed company, and we are overwhelmed with the response and will certainly press ahead with our business expansion and re-organisation plans for the company. 2016 is expected to be another exciting year for us," said Kuo.

CIMB Investment Bank Bhd ( Valuation: 1.65, Fundamental: 1.05) is the sole placement agent for the proposed private placement and principal adviser for the proposals, while ZJ Advisory Sdn Bhd is the financial adviser for the proposals.

Evergreen shares rose two sen or 0.95% today to close at RM2.13, with a market capitalisation of RM512.98 million.