Stocks To Watch Yinson, SunREIT, The Store, SILK, Spritzer, Pensonic, property stocks


Business & Markets 2014
Written by Ho Wah Foon of theedgemalaysia.com   
Friday, 24 January 2014 20:15

KUALA LUMPUR (Jan 24): Based on corporate announcements today, the following companies may be in focus on Monday due to their proposals, results and contracts won (Jan 27):

Yinson Holdings Bhd (YHB) plans to undertake a renounceable rights issue to raise up to RM500 million, increase authorised share capital to RM1 billion from RM500 million, followed by a one-into-two share split.

The rights issue will strengthen the YHB Group’s financial position with enhanced shareholders’ funds and reduced gearing level, said the company in a filing with Bursa Malaysia.

The company said the proposed increase in authorised share capital is to accommodate the issuance of the rights shares and also to facilitate any increase in share capital of YHB in future.

The present authorised share capital of the company is RM500 million comprising 500 million YHB Shares, of which RM258,199,610 comprising 258,199,610 YHB shares have been issued and fully paid-up.

The proposed one-into-two share split may enhance the liquidity and marketability of YHB’s ordinary shares listed on Bursa Securities.

On the rights issue, the company is suggesting an issue price of RM1.93, representing a 59% discount to the TERP of RM4.69 based on the five-day VWAP of YHB Shares up to LPD.

The proposed rights issue may result in the company’s EPS being diluted, said the company.

However, it is expected to contribute positively to the consolidated earnings of YHB for in future years, when the benefits from use of the  rights issue proceeds are realised.

Sunway Real Estate Investment Trust’s net profit for the second financial quarter ended 31st December 2013 rose 10.53% to RM62.03 million, from RM56.12 million in similar quarter a year ago.

Revenue for the quarter rose to RM110.31 million, from RM105.82 in the previous corresponding period.

Cumulative profits for the six months rose to RM117.43 million from RM108.13 million a year ago. Cumulative revenue for the six months was RM210.49 million, up from RM205.59 million.

The company declared a dividend of 2.23 sen per share.

The company attributed its profits mainly to the retail segment of the business. “Net property income of the retail segment for 2Q 2014 was RM53.3 million, an increase of 2.6% or RM1.4 million compared to 2Q 2013.”

On future prospects, the company expects its retail assets to register healthy growth in FY2014 for the retail malls under operation.

The Store Corp Bhd plans to reward shareholders with a first and final single-tier dividend of 3.75% or 3.75 sen for financial year ended September 30, 2013. The stock has a par value of RM1 a share.

The Store, which operates supermarkets, said the ex-date for the dividend falls on May 19 this year. The firm will pay the dividend on June 19.

Today, The Store shares rose 11 sen or 4% to close at RM2.64 on thin trade of 5,600 shares. The Store was the bourse's third largest gainer.

The company's latest reported book value stood at RM6.42 a share.

SILK Holdings Bhd has obtained contracts extension from ExxonMobil Exploration and Production Malaysia Inc worth RM23 million, for the provision of two 60MT anchor handling tug supply vessels.

SILK said the contracts extension is pursuant to the vessel contracts awarded to Jasa Merin (M) Sdn Bhd, a subsidiary of SILK in July 17 last year.

“The contracts extension is expected to contribute positively to the group’s earnings and assets for the financial year ending July 31, 2014,” said SILK.

It added the contracts extension is for a one year period, which will commence on February 2 and 5 this year.

In the past two weeks, SILK’s share price had gone up from 46 sen per to 69 sen today.

Spritzer Bhd reported lower net profit for its second quarter ended 30 November 2013, at RM3.4 million, down 34% from similar quarter in the previous year.

However, revenue for the quarter rose by 18% year-on-year to RM55.2 million from RM46.7 million.

The group had attributed the lower profits to higher operating costs during the quarter as transportation, salary and advertising expenses were higher as well as higher raw material price.

“The weak Malaysian currency had caused an increase in the prices of PET resin consumed,” said the group.

For the six months to November 2013, net profit improved to RM8.6 million from RM8.3 million last year, while revenue increased to RM110.8 million from RM 94.3 million.

Pensonic Holdings Bhd posted a net loss of RM1.16 million for the second quarter to end-November 2013, compared to a net profit of RM1.88 in previous year second quarter.

But the home electrical appliances trading company registered higher revenue of RM88.8 million, compared to RM86.1 million reported in the corresponding quarter last year.

“The slight improvement in revenue is mainly contributed by overseas sales in Vietnam and the Middle-East, which show growth of 14%,” said the company in its filing with Bursa Malaysia.

Despite the increase in revenue, the group posted a net loss due to higher material input price and lower productivity, higher production cost and lower product margin of the group’s products.

“The loss is also due to general impairment of RM0.6 million made for slow moving inventories and realized exchange loss of RM0.6 million which resulted from a weaker ringgit against US dollar during the quarter.”

Property transactions are likely to decline this year amid cautious sentiment and stringent housing loan regulations by financial institutions.

Property stocks may be depressed by a statement by an official from Real Estate and Housing Developers Association (REHDA).

The association’s Penang Chairman, Datuk Jerry Chan, said today the property market is likely to register a decline in both sales and value, Bernama reported.

The market is likely to see a 20% decline in value, he told reporters today.

Chan said the central bank's move to tighten consumer loans are likely to impact the property market as between 80 per cent and 90 per cent of prospective buyers depended on loans to purchase houses.

Buyers were also becoming more cautious this year given the backdrop of rising living cost.

However, Chan noted Malaysia still enjoys low interest rates and good economic growth.