Business & Markets 2012
Written by Surin Murugiah of theedgemalaysia.com
Saturday, 23 June 2012 15:57
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KUALA LUMPUR (June 23): The FBM KLCI is expected to remain resilient and trend higher next week, as the local bourse is viewed as a safe haven market. Over at Wall Street, stocks ended higher on Friday, which could boost regional investor sentiment.
Affin Investment Bank Bhd vice president and head of retail research Dr Nazri Khan said that he expects the FBM KLCI to strongly play catch-up next few weeks (always outperform peers during volatile times as it did in late 2011) due to its 2012 year-to-date underperformance (where the FBM KLCI up 3.2%, while the Phillipines and Thailand were up 15.3% and 13% respectively as at late May 2012).
"Still we expect ample negative drivers to be cautious this week which includes global growth fears due to disappointing global economic data," he said.
Among the stocks that could be in focus next week are DIALOG GROUP BHD , GRAND-FLO SOLUTION BHD , K&N Kenanga Holdings Bhd and NAGAMAS INTERNATIONAL BHD .
Dialog's wholly-owned unit Dialog D & P Sdn Bhd has inked a memorandum of understanding (MoU) with Halliburton Energy Services (M) Sdn Bhd (HESSB) to jointly pursue projects in the re-development of mature oil fields in Malaysia. In a filing on Friday, Dialog said the strategic alliance with HESSB was in line with its strategy to continue to develop its upstream capabilities in the oil and gas activities which include the rejuvenation and re-development of mature oil fields and the development of marginal fields that will create a robust platform for generating long term sustainable revenue from incremental oil and gas production.
Grand-Flo expects to participate more in the domestic government-related sector this year in light of its strategic tie-up with HEITECH PADU BHD .The tracking solutions provider secured its shareholders' mandate for Recurrent Related Party Transactions with HeiTech at the company's Annual General Meeting (AGM) and Extraordinary General Meeting (EGM) on Friday an estimated aggregate value of RM50 million for a one-year period. "This mandate is the first fruit of our strategic tie-up since it was established late last year," the company said in a statement on Friday.
In K&N Kenanga, RAM Ratings said that Kenanga Investment Bank Bhd's proposed RM875.1 million acquisition of ECM Libra Investment Bank Bhd will strengthen Kenanga IB's stockbroking franchise while broadening its distribution network. The rating agency said on Friday that the acquisition has no immediate impact on the Kenanga's financial institution ratings. It said the deal would be financed via a combination of cash (RM659.6 million), new shares (RM120.0 million) and redeemable non-convertible unsecured loan stock (RM95.5 million).
Meanwhile, The Edge weekly in its latest edition reported that Nagamas was in the midst of finalising a few projects in China. It quoted the company's major shareholder Datuk K K Rizal as saying that the company was finalising a few projects in Yangzhou with the city government and a special purpose vehicle.