Stocks To Watch Hibiscus, Hong Leong Bank, Encorp, IRCB, Tebrau and Ekovest, Nextnation, KSK

Business & Markets 2013
Written by Ho Wah Foon of   
Thursday, 26 December 2013 21:06

KUALA LUMPUR (Dec 26): Based on corporate announcements today, the stocks that may lure some attention tomorrow include the following:

Hibiscus Petroleum Bhd, whose share price lost 31 sen or 17% today to end at RM1.53 per unit, may continue to be the focus of the market tomorrow.

The stock took a plunge after news that Hibiscus’ associate and partners have failed to extract commercially viable oil in Oman Block 50. The share price had fallen to an intraday low of RM1.40.

But the damage caused to this SPAC (Special Purpose Acquisition Company) may not be limited to the plunge in its share price and a write-off only, but may also extend to its credibility.

Days before its trading halt on Dec 23 pending a “material announcement”, Hibiscus share had already fallen by 28%.  

“The Hibiscus management will have to rebuild credibility with investors. It is clear that there was heavy selling in the week before the announcement,” a fund manager told

In addition, the RVD technology used by Rex International Holdings Bhd – the partner of Hibiscus in the Oman project – could also be an issue of debate.

Hong Leong Bank Bhd was slammed by the National Union of Bank Employees (NUBE) again after the bank was condemned for not paying annual contractual bonuses to 27 dismissed employees.

“The 27 workers, dismissed in stages from 18th December 2013 onwards were not paid the annual contractual bonus when all other workers were paid the same on 13 December 2013...This points clearly to bad faith ...,” NUBE said in a statement.

The statement also detailed a list of other violations by the bank including unlawful lockout, suspension without pay and denial of annual leave for the affected workers.

The statement was issued in response to HLBB’s statement on the Dec 23 saying the bank had ensured that its employees received adequate support to facilitate their move in a rationalisation exercise conducted by the bank since February 2013.

NUBE had lodged a trade dispute against HLBB over the rationalisation exercise and sought a resolution of the matter by the Industrial Relations Department.

Tensions continued to rise with NUBE secretary-general J-Solomon warning of continued picketing in front of the bank’s headquarters in Jalan Perak in Kuala Lumpur for 10 hours daily until the matter is resolved.

Encorp Berhad announced that its unit Encorp Construct Sdn. Bhd has been awarded a building contract worth RM101.67 million.

It said the award, from Aikbee Timbers Sdn. Bhd, is for the main contract to build a 25-storey mixed-use development construction project in Jalan Kelang Lama, Kuala Lumpur.

Encorp said the contract is for 22 months from Jan 2,  2014 to Nov 1, 2015.

The company expects the main contract to contribute positively to the earnings and net assets of Encorp group for the financial years ending 2014 and 2015.

Integrated Rubber Corporation Bhd (IRCB) announced that it had today submitted its regularisation plan to Bursa Malaysia Securities Berhad for its approval.

The PN17 company added that a circular to its shareholders in relation to the regularisation plan as well as the listing application pursuant to its earlier proposed Advance Capitalisation and ESS have also been submitted to Bursa Securities as part of the application.

If the plan and application are approved, the rubber glove company can expect to uplift itself from the Practice Note 17 status.

Ekovest Bhd and Tebrau Teguh Bhd may feel the positive impact from sister company Iskandar Waterfront Holdings (IWH), which announced today a major joint venture with Singapore developer Hao Yuan Investment Pte Ltd to develop six parcels of waterfront land in Danga Bay.

Both stocks rose at market close today.

The waterfront land, measuring 36.8 acres, was acquired by Hao Yuan from IWH for RM1.6 billion, for an integrated mixed development with a gross development value of RM8 billion over eight years.

“With this JV with Hao Yuan, we plan to build an upscale mixed development project within Danga Bay with property products that will provide long term recurring income for both parties,” said Lim Chen Herng, executive director of IWH.

Hao Yuan plans to introduce several high-end residential, commercial and retail properties in Danga Bay. This will include the tallest iconic tower in the Peninsular and a landmark tower in Iskandar Malaysia.

Nextnation Communication Berhad, which often attracts speculative intersts, saw its net profit for the second quarter ended 31st October 2013 fall to RM1.37 million from RM1.44 million in similar quarter a year ago.

Cumulative profits for the 6 months rose to RM2.9 million from RM2.7 million a year ago.

Revenue for the quarter rose to RM27 million from RM 17.5 million a year ago

Cumulative revenue for the 6 months rose to RM52 million from RM34.1 million.

“The group’s quarterly revenue increased by 52.3% was mainly due to the drastic increase in sales of the group’s products and services,” it said in the filing of its financial results to Bursa Malaysia.

KSK Group Berhad today signed a sale and purchase agreement (SPA) to acquire a parcel of land in Jalan Conlay from Suasana Simfoni Sdn Bhd for RM568 million.  

The property, registered as Lot 20000, Seksyen 63, Kuala Lumpur, is a 3.952-acre piece of freehold land approved for mixed development.

“This SPA marks the maiden acquisition for KSK Group Berhad’s new property development venture, to be undertaken via wholly-owned subsidiary KSK Land Sdn Bhd,” the company said in a press statement.

This Jalan Conlay land is located within one of the choicest parts of the KL City Centre, surrounded by Petronas Twin Towers and Suria KLCC, as well as the prestigious Pavilion Kuala Lumpur shopping mall. 

“We are confident that we will see strong interest from the market as this location will continue to benefit from various ongoing developments, such as the nearby Banyan Tree residences and Harrods Hotel,” said Joanne Kua, CEO of KSK Group and Managing Director of KSK Land.  

She added that KSK Land will now focus on completing the land acquisition by the first quarter of next year whilst continuing to explore opportunities to expand its land bank in the Klang Valley, Penang and Johor.