Stocks To Watch Gamuda, MMC, Hwang-DBS, Sumatec, MRCB, GuocoLand

Business & Markets 2013
Written by Ho Wah Foon of   
Friday, 08 February 2013 19:18

KUALA LUMPUR (Feb 8): From news flow and filings with the stock exchange today, stocks to watch on Wednesday (Feb 13) after the 4-day break may include MMC, Gamuda, Hwang-DBS, Sumatec, MRCB and GuocoLand.

Mass Rapid Transit Corporation Sdn Bhd and MMC-Gamuda KVMRT (T) Sdn Bhd announced that they have signed the agreement for the underground works of the MRT Sungai Buloh-Kajang Line, valued at RM8.28 billion.

MRT Corp’s chief executive officer Datuk Azhar Abdul Hamid said the 9.5 km underground section, situated between the Semantan North Portal and Maluri South Portal, will serve the busiest and congested parts of Kuala Lumpur.

The agreement is for the design, CONSTRUCTION [] and completion of the underground works. The underground works include the construction of tunnels, stations and associated structures along the underground stretch.

MMC-Gamuda KVMRT (T) is a 50:50 joint venture between MMC Corportion Bhd and GAMUDA BHD [].

Phase One of the MRT Sungai Buloh-Kajang Line, stretching from Sungai Buloh to Semantan, will be operational by the end of 2016. The second phase, from Semantan to Kajang, will be open to the public by July 2017.

Additionally, Gamuda may get a boost from a Citi report, which recommends a “buy” call, with target price of RM4.02.

“We believe the company is a key beneficiary of the RM22 billion KVMRT-SBK Line, Malaysia's largest infrastructure project to date, given its part as the Project Delivery Partner with MMC. Gamuda's property division is seeing strong property sales which should translate into earnings growth in FY12-14E,” said Citi said in a note given to the Edge.

Hwang-DBS (Malaysia) Bhd may continue to attract trading interest as the Edge Weekly reported that it is in the final stages of hiring a foreign investment bank to the adviser in the disposal of its entire business, mainly in investment banking and stockbroking.

The major shareholders of the listed company, including DBS of Singapore, are said to be keen to sell the whole company.

Three financial institutions – AFFIN HOLDINGS BHD [], AMMB HOLDINGS BHD [] and K&N Kenanga Holdings Bhd – have expressed interest to take over the company.

The share of Hwang-DBS has been rising since late December from RM2.40, surging to a 52-week high of RM3.88 on Feb 5. The share suddenly shot up 14% to RM3.72 on Jan 31, from RM3.26 the previous day. It closed at RM3.79 today, after gaining 14 sen.

Loss-making SUMATEC RESOURCES BHD [] may also attract some trading interest following a report in the Edge Weekly that its regularisation plan is heading for completion and its oil field in Khazakhtan is producing 300-500 barrels of oil per day.

Its new CEO Chris Dalton said Sumatec could return to the black in the third quarter of 2013, as the company is expected to begin to recognise profits from the sale of oil.

MALAYSIAN RESOURCES CORP []oration Bhd (MRCB) suspended trading of its shares today as the company is proposing a corporate exercise “involving a very substantial transaction”.

MRCB’s shares, last traded at RM1.26, could see movements depending on how investors and analysts view the exercise. The exercise was not known at press time.

But meanwhile, Lembaga Tabung Haji reported that during Feb 5-6, it had bought a total of 1.2 million shares in MRCB after selling a total of 479,000 shares on Jan 21 and Jan 22.

GuocoLand (Malaysia) Berhad informed that it had during the last 12 months, disposed of quoted securities held as investments in the open market for RM45.28 million. The disposals had resulted in a gain of approximately RM3.22 million.