Stocks To Watch Mah Sing, MMC, IQ Group, Top Glove, Brahim’s, MyEG, UOA, MTD-ACPI

Business & Markets 2014
Written by Ho Wah Foon of   
Tuesday, 07 January 2014 21:07

KUALA LUMPUR (Jan 7): Based on news flow and corporate announcements today, the following companies may attract investor interest tomorrow.

Mah Sing Group Bhd announced that the Johor High Court today granted an order to validate the sale and purchase agreement (SPA) for Mah Sing’s Bandar Meridin East, which is a 1,352 acre township in Pasir Gudang, Johor, with GDV of RM5 billion.

On Nov 11, 2013, the vendor Bistari Land Sdn Bhd disclosed that a winding-up petition was taken against it by Lembaga Lebuhraya Malaysia.  But the vendor said it is taking steps to settle the outstanding RM11.6 million to the petitioner and to have the winding petition withdrawn.

Mah Sing said the order today will pave way for Mah Sing to conduct its registration of interest exercise for the project in Johor.

Bandar Meridin East, which has a GDV of RM5 billion, is a self- contained township.  Other than residential and commercial components for the township, the group also intends to explore retail, recreational and even industrial elements for the township.

MMC Corporation Bhd’s unit, MMC Oil & Gas Engineering Sdn Bhd, is one of four companies which have secured a five-year umbrella oil and gas (O&G) support services contract from state-owned Petroliam Nasional Bhd (Petronas).

Petronas said its upstream arm Petronas Carigali Sdn Bhd has also awarded the contract to Technip Consultant (M) Sdn Bhd, RNZ Integrated (M) Sdn Bhd and Perunding Ranhill Worley Sdn Bhd.

Petronas said the contract, which began in September 2013, involves design and engineering services work for its facilities.

According to Petronas, these projects are expected to support the growth of Malaysia's O&G upstream services sector.

This latest announcement by Petronas may further spur interest in oil and gas stocks.

IQ Group Bhd, whose share price rose 30% and hit limit-up after lunch break, was slapped with a UMA (unusual market activity) query by the stock exchange.

The company received the UMA after the stock had risen 30 sen or 30% to RM1.31. It was the top gainer. At the close, the stock stayed at the same price with trades of some 1.74 million shares.

In the UMA, Bursa Malaysia told the company’s board of directors to explain if there is any corporate development, rumour or report relating to the group’s business and affairs that has not been previously announced.

The company’s share price had started to rise in morning trades after RHB Research, in its initiation report on IQ Group, recommended a “buy” call on the stock with a fair value of RM1.84 pegged to 12.5 times price earnings for FY15.

“We like the company for its earnings turnaround, new product launches in the pipeline, its ability to ride on the recovery of the global economy and solid balance sheet with total net cash of RM12.1 million…” commented Chaw Sook Ting of RHB Research.

For the second quarter ended 30th September 2013, the original equipment and design manufacturer of infrared detectors/motion sensor light controllers reported a net profit of RM6.76 million, against a loss of RM226,000 in the previous year corresponding period.

Top Glove Corp Bhd, the world’s biggest glove maker, expects sales revenue and volume to rise over 10% in current financial year ending August 31, 2014.

Chairman Tan Sri Lim Wee Chai said the forecast is based on higher selling prices for gloves amid growing demand for nitrile gloves.

"We expect 10-15% volume growth," Lim said at a briefing for analysts, fund managers, and reporters on Top Glove's financials today.

According to Lim, Top Glove has since January 1 this year raised the selling price for its  gloves by 20 sen to US$20.20 per carton of 1,000 gloves from US$20.

Brahim’s Holdings Bhd announced that it has entered into a collaboration agreement with ANA Holdings Inc to produce halal Japanese cuisine for in-flight catering in Japan.

The parties to the agreement will also consider the establishment of a joint venture for a halal flight kitchen in Narita and Haneda Airports, Tokyo.

ANA is a listed company in Japan with key businesses in the provision of air transportation via All Nippon Airways and travel services. The air transportation business includes in-flight food purchasing.

Brahim’s said the agreement shall remain in effect for a period of one year.

MY E.G Services Bhd (MYEG) today clarified it has not entered into any legally binding agreement with the Royal Malaysian Customs Department (RMCD) as stated in an article published by a local newspaper.

Last week, the newspaper reported that MYEG's stock had jumped yet again on news of a new computer system being tested by the RMCD.

"The board wishes to clarify that the computer system, MyGST, refers to a holistic new system which the RMCD is testing to facilitate the implementation of the goods and services tax by April 1, 2015.

"There are a few parties involved in the various components of this system of which MYEG, via its 40 per cent-owned associate company, MY EG Integrated Networks Sdn Bhd, is one of the parties.

UOA Development Bhd announced that one of its units, Paramount Properties Sdn Bhd, has entered into an agreement with Marak Moden Sdn Bhd to sell a 12-storey office building for RM 72.54 million.

The current book value of the property is RM22.89 million and the sale is expected to generate an estimated gain of RM48.21 million.

The property is held as a property plant and equipment by UOA and is located at Avenue 3, Bangsar South, Kuala Lumpur.

The company said that the rationale for the disposal was for the rapid expansion of the group.

“The proposed disposal is expected to contribute to the earnings of the company.”

MTD ACPI Engineering Bhd announced it has secured a subcontract worth RM40 million for a project in Doha, Qatar, via an unincorporated joint venture company (JV).

The construction and engineering firm said MTD ACP Precast LLC (MAP LLC) secured the subcontract for the manufacture and supply of precast steel fibre reinforced concrete tunnel lining segments of Abu Hamour (Musaimeer) surface & ground water drainage tunnel – Phase 1.

MTD LLC is a subsidiary of MTD ACP Precast Sdn Bhd, which in turn is a wholly-owned subsidiary of MTD ACPI.

“The participation in the subcontract is to capitalise on the construction contract that would enhance the group’s order book and profitability,” said the firm.

MTD ACPI said SMEET and MAP LLC shall share profit and losses arising from the subcontract in the proportion of 51:49 respectively.

The statement added MAP LLC and SMEET Precast SPC had also today entered into a subcontract agreement with Impregilo S.p.A (Qatar Branch), through an unincorporated JV namely SMEET Precast SPC & MTD ACP Precast LLC.

The JV agreement defines the framework for MAP LLC and SMEET Precast SPC in the undertaking of the subcontract for the RM40 million project.