Friday, January 22, 2010

20100122 1440 Heres Comes The China Effect Again !

Alert ! Commodities traded in China recovering like crazy !!! Still searching for the news !

20100122 1345 FKLI Mid Day Hourly Chart Study.

FKLI closed : 1294, changed : -10.5 points, volume : high.
Bollinger band reading : bearish.
MACD Histrogram : getting lower, seller seems encouraged.
Support : 1295, 1290 level.
Resistant : 1300, middle Bollinger band, 1309 level.
Comment :
Haha! Finally some excitement happen today after the Dow closed lower followed by Hang Seng Index opened gap down and traded lower for the 3rd day. The tested few times 1300 support has now turned into resistant level for FKLI. Hourly chart do looks bearish with all indicators going align for negative signal. However, the last hourly candle closed way below the lower Bollinger band shows a temporary oversold market condition.

20100122 1255 FCPO Mid Day Hourly Chart Study.

FCPO closed : 2454, changed : -34 points, volume : low.
Bollinger band reading : side way.
MACD Histrogram : turned and getting lower, seller take turn today.
Support : 2440, 2400, 2370 level.
Resistant : 2470, 2521, middle Bollinger band level.
Comment :
Huh...I guess I over estimated the strength of yesterday up swing. Seems like yesterday surge could be a 1 day wonder due to better China economy performance data. However strong US Dollar recovery forced most commodities price to plunge lower especially crude oil. The same goes to FCPO that trade weaker today with low volume changed hand. The hourly chart suggesting a side way range bound down side biased with price trading along the plotted downward trend line.

20100122 0947 Malaysia Corporate News.

Top Glove aims to match its previous year's dividend payment of 40% of profit. "We have better profit, good cash flow and a very healthy balance sheet," its chairman Lim Wee Chai said. To maintain its earnings growth rate, the company needs to make acquisitions, he said.
  • It is looking for possible purchases in Thailand, Vietnam and Indonesia, as well as within its home in the Malaysian market, he said. The company also wants organic growth, Lim added. The manufacturer has net cash holdings of RM250m. It aims to spend RM100m of this on acquisitions and RM80m on organic growth, Lim said. (Bloomberg)
Top Glove has consistently indicated that they would continue to grow organically and also consider regional M&A opportunities if they can achieve the synergy they want. The company remains confident on achieving a target of 30% global market share by end of 2012 from 22% currently.

Hong Leong Bank has offered RM7.10 per share in a RM4.9bn all-cash deal to take over smaller rival EON Capital. The offer will pave the way for a merger that will create the country's fourth largest bank by assets, overtaking RHB Capital.
  • EON Capital, owner of the seventh biggest among nine local lenders, said it has received Hong Leong's proposal yesterday to buy its entire assets and liabilities. "The board of directors will review the proposal and will make further announcements as and when it has comprehensively reviewed the (terms) and made a decision," EON Capital said. 
  • The smaller lender must respond within seven working days starting yesterday, after which the offer will lapse, according to a separate filing by Hong Leong. Once it agrees to the offer, EON Capital must deal exclusively with Hong Leong on the sale.
  • Hong Leong has set conditions in its buyout proposal that restricts EON Capital from paying extraordinary dividends before the transaction is completed, or to have any adverse change in its financial position. 
  • Hong Leong said the offer price represents a 31.5% premium to EONCap's average share price in the six months before the takeover news first surfaced on 17 Dec.
  • EON Capital must confirm within the seven-day offer period that it would present the offer to shareholders in a general meeting and that it will issue the notice to shareholders within five weeks. EON Capital is also required to finalise and submit for regulators' approval within four weeks of the offer as part of Hong Leong's conditions.
  • The transaction will need the approval of shareholders from both banks, Securities Commission, as well as the Finance Ministry through Bank Negara Malaysia. (BT)
CIMB Thai Bank, a 93.2% subsidiary of CIMB Bank, registered a net profit of THB1.7m for FYE12/09 as a result of two successive quarters of profitable operations. The core operating performance continued to improve but the full-year earnings were affected by several negative one-off items, such as provision for NPL in the 2Q and asset write-off in the 4Q.
  • CIMB Thai achieved a 6% yoy growth in revenue to THB6.9bn, driven by the expansion in non-interest income on the back of robust fee income, gains from the sale of investments and dividend income. 
  • It had also improved its asset quality by reducing total gross NPL by 6% yoy. (BMSB, StarBiz)
Tenaga’s CEO Datuk Seri Che Khalib Mohamad Noh said the Malaysian utility had signed an initial agreement with Korea Electric Power Corp to conduct a study on the development of a nuclear plant. “We have not decided whether to go for nuclear power plant or not. What is important is to conduct all the necessary study to see the viability,” he said.
  • On the undersea cable project, he said, “We are progressing as scheduled. Basically all the survey work is currently ongoing. All the consultants for the preparations of the tender document have been appointed and the tender document, we are targeting to complete that by 1Q.” (Bloomberg, Malaysian Reserve)
Crude palm oil (CPO) rallied 1.9% to a high of RM2,490/MT yesterday after hitting a twomonth low in intra-day trading after China announced its economy in 4Q grew beyond expectations. April delivery for palm oil on the Malaysian Derivatives Exchange settled at RM2,488/MT, an increase of 1.8%.
  • The price fell to a low of RM2,407/MT in the morning. CPO rose following China’s betterthan- expected numbers. Bloomberg had earlier reported that the earlier drop in CPO price was due to concerns that China may import less palm oil this year because of ample supplies of domestic and imported oilseeds and oils. (Financial Daily)
All the RM67bn from the stimulus package allocated by the Government had been channelled for its intended purpose, Deputy Prime Minister Tan Sri Muhyiddin Yassin said. A major portion of the money was for infrastructure projects and there had been clear indications that they had succeeded in spurring the economy, he said.
  • “The first and second quarter of 2009 saw a downturn of 4% in GDP. By the end of 2009, the rate of decline dropped to only 1.2%. If we had not allocated the RM67bil, the country would have witnessed a massive closure of businesses and increase in unemployment." he said. (Star)
Genting’s head of strategic investments, Justin Leong, clarified that, “The building of a theme park and hotel in Johor is part of a broader development plan that the group has for its operations in Iskandar Malaysia. The development plan will be subject to a detailed market feasibility study and is contingent to the successful development of the Johor Premium Outlets, the retail shopping project that Genting Plantations is developing with US-based Simon Property Group Inc.” (Bloomberg)

SapuraCrest Petroleum is poised to seal a multi-million dollar contract in Chennai with an Indian partner today. It is learnt that the deal is related to the use of SapuraCrest's new derrick lay vessel for an oil & gas major. The signing ceremony of the contract is due to be witnessed by PM Datuk Seri Najib Tun Razak, who is on his final leg of a five-day working visit to India. SapuraCrest has for the past 10 years invested US$110m in the Indian oil & gas sector. (BT)

India's telcos will now have to shell out higher levies for utilising spectrum from Jan 1, 2010. The move will further hit the bottomlines of all companies whose profits have been impacted due to a fiercely competitive price war. The nine-member empowered group of ministers (EGoM) during its meeting last week endorsed a proposal from the communications ministry to increase the spectrum usage charges by up to 2%.
  • For the industry, the EGoM move implies that all operators combined will have to shell out an additional Rs 2,000 crore (US$4.3bn) as levies for using the radio frequencies allotted to them. Besides, this will also result in a proportional increase in the usage charges for 3G spectrum. (Economic Times of India)
Smallcap World Fund Inc, a US-based investment firm, has emerged as a substantial shareholder of Green Packet. It bought 5.2% on 11 Jan. Smallcap continued to buy more shares, and as on Wednesday, held 6.02% of Green Packet shares. (BT)

Redtone, which has a WiMAX licence for Sabah and Sarawak, remains hopeful of securing a licence for Peninsular Malaysia, said its group CEO Zainal Amanshah. "We believe we should be given a chance in Peninsular Malaysia as customers are demanding for more such services to be offered here." It also wants to venture into the distribution of mobile Internet device and 3G related services in China.
  • It plans on doing so via acquisitions and is now in talks with several potential parties. Separately, Redtone is set to launch Malaysia's first Chinese-centric IPTV, dubbed DETV, next Tuesday with 27 channels to generate more revenue other than discounted voice. "All you need is a broadband connection with 1Mbps and a TV set. 
  • TV programmes with superior quality will be transmitted directly to you throught the internet by just clicking the remote control that comes with your DETV Internet home gateway. No computer is needed" (BT, Financial Daily)
MISC has launched a new service called Malaysia East Asia Service to complement its current Halal Express Service as well as meet growing demand from the carriage of cargo within the intra-Asian region. MISC said the new service will directly connect the Far East ports such as Ho Chi Minh City and Southeast Asia. The service will start on January 26 with its maiden voyage starting from Yokohama, Japan. (BT)

AirAsia is aggressively growing its cargo business and utilising Special Prorate Agreements (SPA) with various airlines to achieve its revenue target for 2010. Asia's largest low-cost carrier has been tying up with more cargo agents and large export-import firms in the markets that AirAsia flies to.
  • It is also reaching markets beyond its current route network through other airlines with which AirAsia has SPA agreements. These major airlines extend AirAsia's reach to more cities in South Asia, East Asia, the Middle East, Africa and Europe. The airline, which considers cargo as a major area of growth for 2010, expects its cargo revenue to grow by more than 40% this year. (SBT)
Firefly will announce the second phase of its route network expansion by March this year. "The details of the expansion and the delivery of the three ATR72-500 aircraft will be made after the company's extraordinary general meeting in late March," marketing head Angelina Fernandez said. Firefly, which has seven ATR 72-500s, needs additional planes to fuel its growth expansion and is keen to take delivery of three additional ATRs, which were deferred from last year.
  • The airline has also cut back on several routes last year including Subang-Phuket and Subang-Padang as passenger traffic slumped due to the economic downturn. On Firefly's mobile application, Fernandez said that passengers can book their flights using their mobile phones after first registering on Firefly's website. (BT)
YTL Cement has submitted an offer to buy Holcim Singapore’s entire 55.87% stake in Jurong Cement for S$61.9m or S$2.50/share. (BT)

Hunza Properties plans to attract an international retailer to be an anchor tenant at its RM400m Gurney Paragon shopping mall in Penang, which is slated to open in two years. Its executive chairman Datuk Khor Teng Tong said apart from creating between 3,000 and 4,000 new jobs in Penang when the mall opens, plans are in place to bring in new names to the state's retail scene. "These will be old and well-loved international brands, which are not yet in Penang but already in Kuala Lumpur," he said. (BT)

The manager of Axis REIT targets to manage RM1bn worth of assets by year-end. It plans to buy five properties, valued at about RM180m, this year. It is now assessing two new warehouses in Port of Tanjung Pelepas in Johor, a factory or a warehouse in Puchong, Selangor, and an office building in Cyberjaya.
  • "We are targeting another capital raising exercise in early 2010," said CEO Stewart LaBrooy. Axis REIT plans to place out another 61.4m units (20% of its current fund size), which will raise some RM113m. 
  • The manager is optimistic of maintaining this performance despite a soft property market outlook this year. LaBrooy said he is confident of the property trust's growth strategy to actively pursue quality acquisitions. (BT)
The Employees Provident Fund has emerged as a substantial shareholder of Perwaja Holdings with a 5.4% stake. (BT)

Formis Resources is suing Datuk Patrick Lim, former head of Equine Capital, in relation to a commercial vehicle driving centre venture in a civil suit claim of RM5.56m plus interest at a rate of 8% per annum. (Malaysian Reserve)

Former Ho Hup Construction Co MD Datuk Low Tuck Choy has no intention of making a comeback to the construction firm his father founded. “All I want to do is to protect the interest of minority shareholders,” he said when asked for his reason for calling the removal of the majority of Ho Hup’s current board of directors. Tuck Choy, through his family’s holdings and other direct stakes, controls about 27% of Ho Hup’s shares. (Starbiz)