KUALA LUMPUR (July 12): The FBM KLCI is likely to extend its positive run on Thursday, just as it defied regional and global market sentiments on Wednesday to hit a fresh all-time high. The index closed 5.16 points higher at 1,629.45 on Wednesday, having earlier risen to its intra-day high of 1,635.50.
Global sentiment is likely to remain tepid, as European shares fell on Wednesday, led by luxury goods companies as a slowdown in sales growth at British group Burberry affected the sector and highlighted the weak macroeconomic environment, according to Reuters. The FTSEurofirst 300 index fell 0.4% to 1,034.54 points, while the Euro STOXX 50 index declined by 0.5% to 2,230.50 points, it said.
Among the stocks that could be in focus on Thursday are Maxis Bhd, AMMB HOLDINGS BHD [], SIME DARBY BHD [] and ADVENTA BHD [].
Maxis Communications Bhd was quoted as having "one or two parties shown interest" in taking a stake in India-based Aircel Ltd, but an official close to the companies said these discussions are "usual in any business" and dismissed talks of billionaire T Ananda Krishnan's imminent exit from India as "speculation".
"How does one get transactions done propitiously in the current [fluid] telco regulatory environment?" the official close to Maxis told The Edge Financial Daily on Wednesday when asked about a write-up in The Economic Times of India dated Wednesday headlined Maxis set to exit India: In talks to sell Aircel. Maxis Communications is the major shareholder of Aircel as well as Bursa Malaysia-listed Maxis Bhd that houses billionaire Ananda's Malaysian telecommunications flagship operator.
Analysts are concerned for the premium paid by AMMB Holdings for the purchase of MBF Cards (M) Sdn Bhd from MBf HOLDINGS BHD [] for RM623.4 million, given the limited earnings contribution from the acquisition. The purchase translates to a price-to-book multiple of 2.7 times, based on AMMB's net assets of RM229 million at the end of last year.
"Although the acquisition is expected to be earnings accretive, we believe the market will not be overly excited for the deal given its premium price tag," said Alliance Research in a report on Tuesday. Alliance said MBF Cards' net earnings of RM48 million last year constituted only 3% of its earnings estimates for AMMB this year. Moreover, the acquisition is only expected to be earnings accretive after a year.
Sime Darby's unit Sime Darby Property's (SDP) Lifestyle Collection has recorded a total gross sales value of close to RM800 million since the campaign was introduced. In a statement Wednesday, Sime Darby group chief operating officer and SDP managing director Datuk Abd Wahab Maskan said the Sime Darby Property Lifestyle Collection had positioned the company as the brand for township development.
Shares of Adventa will likely continue to attract investor market interest after the company's major shareholder and a private equity partner proposed to pay RM2.10 per share for Adventa's glove making business including all of the company's assets and liabilities. Adventa jumped 27 sen to RM1.88 on Wednesday, with 233,800 shares done.
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