Stocks to Watch Aviation stocks, Brahim’s, Goldis, IGB, Alliance

Business & Markets 2014
Written by Ahmad Naqib Idris Adzman Shah of   
Friday, 18 July 2014 20:39

KUALA LUMPUR (July 18): Based on corporate announcements and news flow today, stocks in focus next Monday (July 21) could include:

Goldis Bhd has made a conditional take-over offer to acquire all the remaining shares in IGB Corp Bhd for an offer price of RM2.88 per share compared with its market price of RM2.84 prior to the announcement.

Goldis has 30.66% equity interest in IGB Corp as at July 17, 2014.

“The Proposed Offer provides an opportunity for Goldis to obtain a significant block of IGB Corp Shares, by increasing its direct interests to over 50% at a reasonable cost. 

“The Offer Price is at a marginal premium of 1.41% of the market price of RM2.84 as at 17 July 2014, and at a discount of 11.4% to IGB Corp’s audited NA (net asset) per share as at 31 December 2013,” said the group.

After the completion of the proposed take-over, Goldis will have a majority shareholding of over 50% in IGB Corp. However, Goldis intends to maintain IGB Corp’s listing status.

Loss-making Malaysia Pacific Corp Bhd is undertaking a massive fund-raising exercise to raise some RM230 million fresh capital to pare down its borrowings.

The fund raising exercise includes rights issue of new shares, and two types of irredeemable convertible unsecured loan stocks (ICULS), according to the company’s announcement to Bursa Malaysia.

Alliance Financial Group Bhd expects to finalise the appointment of its new CEO before the end of 4Q14 following the resignation of Sng Seow Wah.

The bank confirms that the recruitment process has started and that it will be looking at internal and external candidates for the position.

AFG said it will announce the chosen candidate as soon as it obtained Bank Negara's approval.

YGL Convergence Bhd has secured a RM1.125 million deal from Country Heights Holdings Bhd (CHHB) to provide its proprietary software solutions to the property conglomerate, it said in a filing to Bursa Malaysia.

“YGLCM will provide a system and implementation of YGL proprietary software namely YGL E-Corporate Suite, YGL E-Consolidation System, (and) YGL Health Sanctuary System with Malaysian Goods and Services Tax (“GST”) advanced features,” it said in the statement.

YGLCM will be providing its YGL E-Corporate Suite to cater to CHHB and its subsidiaries’ financial applications; Ygl E-Consolidation System is to computerise the month-end and year-end CHHB Group's consolidation and reports; and YGL Health Sanctuary System is to automate the tracking of health screening and traditional Chinese medicine treatment for the CHHB Group.

The project will take place between September 2014 and February 2015 and is a one-off exercise with a yearly software maintenance contract.

Aviation stocks such as Malaysian Airline System Bhd’s (MAS) and Malaysia Airport Holdings Bhd may continue to be in the spotlight after MH17 tragedy.

Analysts said that the crash has affected sentiments on the aviation sector.

The plane crash is the second tragedy that has happened to MAS in less than six months, after the disappearance of Flight MH370 in the Indian Ocean.

Analysts said the tragedy would make MAS’ restructuring efforts more challenging.

Brahim’s Holdings Bhd, the in-flight caterer for MAS, may also be closely observed as the possible lower passenger numbers may translate to a slowdown in total in-flight meals produced.

However, an analyst noted that the company had weathered well through the previous MH370 tragedy, as it maintained an average of one million meals per month.