Business & Markets 2013
Written by Ho Wah Foon of theedgemalaysia.com
Wednesday, 16 October 2013 19:14
KUALA LUMPUR (Oct 16): KLCI index-linked stocks may lead the market to rise, if the current frantic talks in Washington to avert a US debt default could come to a positive close tonight.
But if there is a breakdown in talks, the overall market could react negatively. If there is no deal before the October 17 deadline, the US government would run out of ways to borrow.
Reuters reported today that an agreement to lift the government's US$16.7 trillion borrowing limit was near but details still needed to be worked out.
Based on local corporate announcements today, the stocks that could stir up some interest tomorrow include Atlan, MYEG, Btoto, MAHB, Daya and Zhulian.
Atlan Holdings Bhd announced a much weaker second quarter results.
For the three months to end-August 2013, it posted a net profit of RM4.6 million, down by 71% year-on-year. Its revenue for the second quarter also fell to RM174.3 million, from RM199.1 million.
“The decrease in revenue in the duty free segment in the current quarter as compared to the corresponding quarter in previous year was mainly due to change of sales mix and also lower demand from customers for certain products,” said the company.
In the duty free segment for the quarter, the profit was lower than corresponding quarter in previous year due to decrease in revenue, higher net unrealized foreign exchange loss and higher rental expenses, it added.
But for the six months to August 2013, Altan’s cumulative profits soared to RM151.6 million, from RM25.4 million a year ago, due mainly to the net gain of RM153.6 million arising from the disposal of assets, which was completed in March 2013.
MYEG Services Bhd could see some interest after Cradle Fund Sdn Bhd, an agency under the Ministry of Finance, announced it is partnering with e-government services provider MYEG Services Bhd to establish a RM60 million Cradle Seed Ventures Fund 1.
“The fund will go into supporting dynamic start-up technopreneurs by investing between RM1 million and RM3 million that will help their businesses reach greater heights,” said Cradle in a statement.
“The establishment of CSV Fund 1 and CSV Sdn Bhd will also mark Cradle’s first steps into the equity investment market,” it added.
Berjaya Sports Toto Bhd (Btoto) announced that the Monetary of Singapore (MAS) has set a minimum issue price of 50 Singapore cents for the initial public offering (IPO) in Sports Toto Malaysia Trust (STM-Trust).
STM-Trust will be listed on the Singapore Exchange Trading Ltd (SGX-ST) and its secondary listing will be on the main board of Bursa Malaysia.
BToto has proposed to transfer its 100% equity interest in Sports Toto Malaysia to STM-Trust.
It has proposed to distribute up to 2.81 billion units of the STM-Trust to BToto shareholders under the secondary listing. The distribution would be on the basis of 21 STM-Trust units for every 10 BToto shares held.
Malaysia Airports Holdings Bhd (MAHB) announced that klia2, the world's largest purpose-built airport for low-cost carriers, is 94% complete and is slated to open by the May 2, 2014 deadline.
MAHB Chief Operating Officer Datuk Abd Hamid Mohd Ali said the terminal building was 99% ready and "is at finishing work stage", reported Bernama.
MAHB expects 80% occupancy rate on the first day of operations, he told the media today.
Abdul Aziz said he was confident that by December this year, "all retailers can come in and do their renovations and refurbishment for their outlets."
"When operational, klia2 will handle up to 45 million people and this underscores the country's position as the fastest-growing aviation hub in this region," he said.
Daya Materials Bhd announced that it has via its subsidiary secured a charter contract with Allseas UK Ltd, with an estimated value of between RM7.8 million to RM11.8 million.
The integrated oil and gas player said it has via Daya Offshore Construction Sdn Bhd (DOC) entered into a Charter Party Contract with Allseas on Oct 14, 2013.
Daya said this is in relation to the appointment of DOC as a contractor for the provision of offshore walk to work subsea construction vessel (Siem Daya 1), together with a range of offshore services for the United Kingdom North Sea Region.
“The contract and the successful implementation of the charter is expected to contribute positively towards our earnings and net assets for the period of the charter,” said Daya.
Zhulian Corporation Bhd’s net profit surged 43% year-on-year (y-o-y) to RM40 million, from RM28 million, in the third quarter ended Aug 31, 2013.
The multi-level marketing (MLM) firm attributed the improved net profit to the increase in share of profit of equity accounted investee and larger revenue.
The group’s 3Q revenue grew 12.7% to RM124 million from RM110 million in the previous year corresponding quarter. Zhulian said this was mainly contributed by the increase in overseas sales.
Cumulatively, the group’s net profit registered RM107 million versus RM86 million a year earlier while it raked in revenue of RM339 million from RM333 million a year ago. The MLM firm attributed the same reasons for the positive results.
“We have targeted a positive growth in revenue for the financial year 2013,” said Zhulian.
“The board opines that our internal target is achievable based on the current market condition and current available information of local and overseas market.”