Stocks to watch Felda Global Ventures, APFT Bhd, Oriental Interest


Business & Markets 2013
Written by Surin Murugiah of   
Sunday, 20 October 2013 14:38

KUALA LUMPUR (Oct 20): The FBM KLCI is expected to trend higher next week ahead of teh tabling of Budget 2014 on Friday, but gains could somewhat be limited in line with historical trends.

Affin IB vice president and head of retail research Dr Nazri Khan said he expects the local market to trend higher and test all-time-record-high (1826.22 level) on USA debt breakthrough as well as on Budget-2014 and post-UMNO-election rally.

He said local stocks should get momentum from strong global stocks performance which already rose to five-year highs after the US Congress approved an 11th-hour deal to reopen the federal government and raise the debt ceiling, averting a potential default.

“Anxiety in the US short-term fixed income market eased markedly (with one-month USA T-bill yields at one month low) as traders increased their bets on an imminent recovery of the global financial system.

“On the technical front, the possible upside penetration of the FBM KLCI to close above the psychological resistance of 1,800 would open up upside possibilities of a new leg towards 1,850-1,900 level over the medium term,” he said.

Among the stocks that could be in focus next week are Felda Global Ventures Holdings Bhd, APFT Bhd and Oriental Interest Bhd

The Edge weekly in its latest edition reported that Koperasi Permodalan Felda Malaysia Bhd (KPF) intends to buy at least a 10% stake in FGV with the RM2,2 billion proceeds from the sale of its 51% stake in Felda Holdings Bhd to the latter.

The magazine also cited Federal Land Development Authority director general Datuk Faizoull Ahmad as saying that KPF would also distribute part of the proceeds to Felda settlers.

The Edge also reported that APFT’s proposed venture into the oil and gas (O &G) industry, which was announced last month, took many by surprise.

The magazine reported that the company’s major said that the move was to enable the flight academy operator, which had been loss making since the second half of last year, to immediately return to the black.

The Edge cited APFT executive chairman and the single largest shareholder Datuk Faruk Othman as saying the group expects to complete its acquisition of a 51% stake in PT Technic Sdn Bhd – a downstream O & G player – by end-November after obtaining regulatory and shareholder approvals.

“This means, by the end of the 15 months ending March 31, 2014, we should be in the black,” the Edge reported him as saying in an interview.

Meanwhile, the Edge reported that Oriental Interest caught the eye of investors when it shares rallied almost 60% in two weeks to an all-time high of RM2.30 last Friday, fuelled by speculation of a possible privatisation exercise.

The magazine said the property developer may not have much to write home about in terms of earnings performance this year.

“But it boasts a relatively strong balance sheet, with a  net cash position and landbank that is potentially undervalued,” it said.