Stocks To Watch Auto stocks, SP Setia, FGV, oil/gas stocks, CIMB, Digi, Axiata, Iris, Hibiscus

Business & Markets 2014
Written by Ho Wah Foon of   
Monday, 20 January 2014 19:46

KUALA LUMPUR (Jan 20): Based on news flow and corporate announcements up to 7.00 pm today, companies that may catch the eye tomorrow include the following:

Cars and auto parts makers may be impacted by the revised National Automotive Policy (NAP) 2014 unveiled today.

The government said it will issue licenses and incentives for manufacturers to make small, energy efficient cars in Malaysia, potentially benefiting Honda Motor Co Ltd and Nissan Motor Co Ltd which have operations here, reported Reuters.

"We hope this National Automotive Policy (NAP) 2014 can enable us to become the energy efficient vehicle hub in ASEAN in the future," International Trade and Industry Minister Mustapa Mohamed told reporters at a news conference today.

"We hope to raise total production volume to 1.25 million vehicles by 2020 from some 0.57 million vehicles," he said.

The revised NAP also aims to reduce car prices by 20%-30% over the next five years, Bernama reported.

Mustapa said the automotive policy provides for a total financial package of about RM2 billion and lays out the measures and implementation plans for its realisation.

The minister said Malaysia wants to increase exports of vehicles to at least 200,000 units and automotive components to at least RM10 billion by 2020.

S P Setia Bhd announced that its CEO Tan Sri Liew Kee Sin, Chief Financial Officer Datuk Teow Leong Seng and Director Tan Sri Lee Lam Thye have given notice of their resignations.

The top property developer will see Liew resign from his position on 30 April, while Teow will leave on 31 July 2014.

Chief Operating Officer Datuk Voon Tin Yow will assume the role of acting president and CEO for one year, starting 1 May 2014, supported by Executive Vice President Datuk Khow Chap Jen, as acting deputy president for the period.

Voon and Khor have been with the group since 1996.

Liew said S P Setia is currently at its strongest position in business and financial terms.

Felda Global Ventures Holdings Bhd (FGV), the world's third largest oil palm plantation operator, is eyeing a bigger external network and will tap the Pakistan, India and Bangladesh markets this year.

Its Senior Vice-President and Acting Head of Downstream, Zakaria Arshad, told Bernama these countries offer tremendous business potential, especially in the export of FGV's downstream products.

"FGV is targeting markets that have few players and at the same time have big consumer spending most of it from the lower income level," he told Bernama during the company's trip to its outlet in Cebu on Saturday.

Zakaria said these three countries use edible oil for cooking purpose and Muslims account for a large proportion of their huge population.

Zakaria said FGV also plans to export its downstream products to Aceh and Kalimantan.

Oil and gas stocks may be excited by news that Petronas Carigali Sdn Bhd has invited bids for its Besar gas field (for two wellhead platforms), located offshore Peninsular Malaysia.

According to international oil & gas news portal Upstream Online, the bids are due at the end of February 2014. 

Alliance Research believes the initial contract award is slated for the end of this year, with a separate tender for installation to emerge later on.

“The contract value will be RM100 million to RM150 million for both wellhead platforms. Malaysian players might have advantage for the Besar project,” said Alliance research analyst Arhnue Tan.

CIMB Thai Bank PCL's net profit rose 14% to THB1.49 billion (about RM150 million) in the financial year ended December 31, 2013 (FY13) from THB1.31 billion a year earlier.

CIMB Group Holdings Bhd owns 93.71% stake in CIMB Thai. CIMB Group told Bursa Malaysia today that CIMB Thai's interest income climbed to THB12.38 billion from THB10.17 billion.

Net fee and service income increased to THB1.26 billion from THB865.44 million.

CIMB Thai President and CEO Subhak Siwaraksa said: "The increase in income (net profit) was mainly attributed to a growth in net fee and service income of 45.4%, net interest income of 25.3% and other operating income of 9.2%.

"The provisions expense increased by 97.5% Y-o-Y mainly from special provisions set aside as counter-cyclical buffer.”

CIMB Thai's income statement showed  its tax assets came to THB82.66 million, compared to tax expenses of THB353.28 million. Bad debts and impairment losses rose to THB2.74 billion from THB1.39 billion.

According to Subhak, CIMB Thai's gross loans rose 23.2% to THB171.1 billion. Non-performing loans (NPL) came to THB4.9 billion, equivalent to a gross NPL ratio of 2.5%. 

DiGi.Com Bhd and Axiata Group Bhd have extended their telecommunication network-sharing programme in Malaysia for another three years.

The new term under both firms’ network collaboration agreement (NCA) began January 18, 2014.

DiGi said the NCA extension follows the expiry of the previous three-year term last Friday (17 January).

"During its tenure, both parties have been able to realise the opportunities and benefits of collaboration in an inclusive and sustainable manner.”

The NCA is expected to result in "increased operational efficiencies for the parties".

Iris Corp Bhd (ICB) has acquired a controlling stake in a Solomon Island-based firm which has proposed to undertake a mixed property project there.

ICB said it has subscribed for 51% of JR Development (SI) Co Ltd (JRD) for Solomon Island Dollars (SBD) 6 million (RM2.97 million) through ICB's subsidiary Iris Land Sdn Bhd (ILSB).

With the subscription, ILSB will participate in a project to develop residential, commercial, retail and industrial units on 40ha (100 ha) of land in Mamara within the Honiara area in the South Pacific nation.

“The subscription will enable the ICB Group to expand its construction and development business overseas to an international level,” said ICB.

Hibiscus Petroleum Berhad issued a public release made by its joint venture partner, 3D Oil Limited, that indicated the latest oil reserves in the West Seahorse Oil Field in offshore Gippsland Basin.

In the release, 3D Oil Ltd said an independent expert report dated Jan 14, 2014, showed that oil reserves for the West SeaHorse (WSH) Oil Field stood at 6.5 million barrels as at Dec 31, 2013.

WSH is being developed for production in 2015 by the joint venture of 3 D Oil and Carvavon Hibicus Pty Ltd.

Hibiscus Petroleum, through its wholly-owned subsidiary Carnarvon Hibiscus, has an operating ownership of 50.1% of Exploration Permit VIC/P57 and Production License VIC/L31. The balance 49.9% is owned by 3D Oil Limited.