Stocks To Watch Perwaja, Kinsteel, Hiap Teck, Crescendo, MMHE, KPJ, KUB, KimLoong, V.S, Hytex


Business & Markets 2013
Written by Ho Wah Foon of theedgemalaysia.com   
Friday, 27 September 2013 19:53

KUALA LUMPUR (Sept 27): Based on corporate announcements today, the exciting stocks on Monday could include Perwaja, Kinsteel, Hiap Teck, Crescendo, MMHE, KPJ, KUB, Kim Loong, VS Industry and Hytex.

Perwaja Holdings Bhd (PHB) announced that the government’s Corporate Debt Restructuring Committee (CDRC) has agreed to render help in its negotiations with creditors for a debt restructuring programme.

One key condition is that PHB has to come out with a debt restructuring scheme within 60 days from Sept 26.

Giving the rationale for the debt restructuring, PHB said: “By restructuring and re-terming the tenure of the liabilities of PHB, it is expected that the PHB will be in a better position to meet their working capital needs in the future to continue and improve their operations while servicing their debt obligations.”

In addition to aiding its proposed concentration and pelletising plants currently being constructed by the company, the restructuring will be required to help in the turnaround of the company, it added.

KINSTEEL BHD [], which is the financially-distressed parent company of Perwaja Steel, also announced in a separate statement that the CDRC has agreed to help it in its debt restructuring plan.

Like Perwaja, Kinsteel has 60 days from Sept 26 to come out with a debt restructuring scheme.

HIAP TECK VENTURE BHD [] posted a 59-fold increase in fourth quarter net profit from a year earlier. The rise came mainly from the steel product manufacturer's non-operating income.

Hiap Teck plans to pay a dividend of 0.6 sen a share in 4QFY13. This is the first payout for the year.

Hiap Teck said net profit rose to RM12.37 million in the quarter ended July 31, 2013 (4QFY13) from RM206,000. Revenue however fell to RM273.94 million from RM291.58 million.

Hiap Teck's bottom line in 4QFY13 had included net foreign exchange gains, besides finance income from available-for-sale financial assets.

Cumulative full-year net profit climbed to RM24.29 million from RM16.58 million a year earlier. Revenue fell to RM1.11 billion from RM1.12 billion.

Looking ahead, Hiap Teck said its projects under the Economic Transformation Programme play an important role in driving demand for steel products.

CRESCENDO CORPORATION BHD []’s net profit jumped 175.5% year on year to RM25.9 million for the second quarter ended July 31, 2013, from RM9.4 million a year ago, mainly due to higher contribution from its industrial property sales.
Revenue rose by 20.5% to RM86.7 million for the period under review versus RM72 million for the previous corresponding period.

“The higher profit margin was mainly due to change in sales mix with higher contribution from high margin industrial property sales,” it said.

Malaysia Marine and Heavy Engineering Bhd (MMHE)’s joint venture company with Technip has been awarded by Petroliam Nasional Bhd (Petronas) an oil and gas support services contract for two gas fields in Sarawak.

In a statement, Petronas announced that this contract has been awarded to the Technip-MMHE joint venture after a bidding process.
Petronas said the engineering, procurement, CONSTRUCTION [], installation and commissioning (EPCIC) contract is for the development of gas fields in Block SK316. The gas fields are located north of Bintulu.

KPJ HEALTHCARE BHD [] announced that via its wholly owned subsidiary it has signed a joint venture agreement (JVA) with a unit of University Teknologi Malaysia for a hospital project worth RM128 million.

The private healthcare provider said its unit Kumpulan Perubatan (Johor) Sdn Bhd (KPJSB) today signed a JVA with UTM Holdings Sdn Bhd for the project.

The JVA consists of designing, developing, building and operating a private hospital on a portion of the leasehold land in Mukim Kulaijaya, Johor, it said.

The proposed JV shall operate through a JV company where KPJSB and UTM Holdings will hold 60% and 40% equity interest respectively.

KPJ said the new hospital building will have a multi-discipline services with a maximum capacity of 500 beds. The first phase will be equipped with 150 beds costing RM128 million comprising land, building and medical equipment.

KUB MALAYSIA BHD [] announced that via its wholly owned subsidiary had on Sept 26 accepted a contract award from UMP Holdings Sdn Bhd for a RM39 million project.

The diversified entity said KUB Builders Sdn Bhd had accepted the contract for the project known as ‘Cadangan Pembangunan Koleh Kediaman Pelajar KK4’ at University Malaysia Pahang, Gambang.

“The contract will contribute positively to the group’s earnings and earnings per share for the financial year ending Dec 31, 2013,” said KUB Malaysia.

The group said the tenure of the contract is 48 weeks from Sept 11, 2013, the date of site possession.

KIM LOONG RESOURCES BHD [] posted a lower net profit of RM11.4 million for the second quarter ended July 31, 2013, compared to RM13.7 million for similar quarter a year ago.

Revenue also fell to RM142.0 million, from RM154.5 million.  

But the company declared an interim dividend of 5 sen.

For the half year to July 2013, the total profit was RM25.5 million, down from RM31.1 million in the first half of the previous year. Revenue fell to RM279.3 million, from RM312.2 million.

The company said the lower revenue and profit for the first half were mainly due to lower crude palm oil (CPO) and palm kernel oil (PKO) prices.

“We expect the group’s performance to be satisfactory for the financial year 2014,” said the company.

V.S. Industry Bhd’s net profit skyrocketed by 325% year-on-year (y-o-y) to RM36 million from RM8.5 million in the fourth quarter ended July 31, 2013.

The plastic and electronics manufacturer said the jump in net profit was due to the net gain of RM30.4 million arising from acquisition of an additional 17.18% equity interest in V.S. International Group Limited.

Meanwhile, 4Q group revenue shed 1.9% to RM359.7 million versus RM366.8 million in the corresponding quarter a year earlier.

Cumulatively, full year net profit rose 17% y-o-y to RM43 million from RM37 million while full year group revenue dropped 3.2% to RM1.16 billion versus RM1.2 billion a year earlier.

HYTEX INTEGRATED BHD [], which had risen to as high as 35.5 sen today, was slapped with UMA (unsual market activity) query by Bursa Malaysia.

Bursa issued the UMA after the share price of the company jumped several folds from 8 sen in the last three weeks on heavy trades. The stock jumped from 11.5 sen on Sept 12 to 28.5 sen on Sept 17.

In the UMA, Bursa wanted the company to state whether there are any corporate developments relating to the group’s business and negotiations that have not been previously announced.

A check with Bursa filings show that on Sept 13, Hytex informed the stock exchange that it intended to present a formal debt restructuring scheme to all bankers for their consideration “within the next two (2) weeks from the date of announcement”.

And on Sept 20, a substantial shareholder of the company, Saw Guat Choo, informed that on Sept 19 (last Thursday) she had bought in 5.45 million shares.