Monday, January 25, 2010

20100125 1838 FCPO EOD Daily Chart Study.

FCPO closed : 2469, changed : +14 points, volume : lower.
Bollinger band reading : bearish.
MACD Histrogram : continue to recover, some short covering.
Support : , 2440, 2400 level.
Resistant : 2500, 2521 level.
Comment :
FCPO traded marginally higher with low volume changed despite a better export figure released by both export cargo surveyor. Trade mostly range bound through the day with some testing activited took place at near resistant and support level. Technically, the daily chart still biased to a downside market despite MACD Histrogram reading improve slightly but still remained under the negative territory. Fundamental wise, good news release but ended with a doji bar candle may suggest that the underlying market could still be weak.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20100125 1736 FKLI EOD Daily Chart Study.

FKLI closed : 1295, changed : -0.5 point, volume : lower.
Bollinger band reading : neutral, side way  range bound.
MACD Histrogram : continue lower, seller testing their luck .
Support : 1290, 1286 level.
Resistant : 1295, 1300, 1309.
Comment :
FKLI closed half point lower after seller tested a new low but still feel not convinced enough with the market underlying weakness lead FKLI to a late recovery forming a wide range bar candle. Technically, daily chart and indicators readings suggesting a side way range bound market with some testing activities at the support and resistant level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20100125 1305 FKLI Mid Day Hourly Chart Study.

FCPO closed : 1293, changed : +2.5 points, volume : high.
Bollinger band reading : bearish biased.
MACD Histrogram : recovering slowly.
Support : 1290, 1286 level,
Resistant : 1295, 1300 level.
Comment :
Last Friday DJIA weaker closing leads FKLI to opened gap down near support level but recover slightly toward the close of the first session. FKLI hourly chart still looks weak by trading at below middle Bollinger band level. Expection market to trade side way range bound downside biased.

20100125 1255 FCPO Mid Day Hourly Chart Study.

FCPO closed : 2479, changed : +24 points, volume : low.
Bollinger band reading : sideway bearish biased.
MACD Histrogram : getting higher slowly.
Support : 2470, 2440, 2400,
Resistant : 2500, 2521 level.
Comment :
FCPO recovered partially in the morning session after export cargo surveyor ITS reported a 20% improvement in crude palm oil export for the period of 1~25 Jan 2010 compare to the same period last month. Hourly chart suggesting that FCPO is likely to trade side way rangebound upside biased recovery stage but the upside room could be limited to the immdiate resistant levels unless there is a big suprise export data release by SGS export cargo surveyor on the second half session.

20100125 0943 Malaysia Corporate News.

PLUS Expressways entered into a Share Purchase cum Shareholders' Agreement with Navayuga Engineering Company Limited, Indu Projects Ltd, M/s. Abhishek Developers and Indu Navayuga Infra Project Private Limited for the proposed acquisition of up to 74% of Padalur-Trichy Highway, in the State of Tamil Nadu, south of Chennai, India. The highway is 39km in length and has a concession period of 25 years ending 2031. Construction is 95% completed (33km completed). PLUS will internally fund the acquisition cost of RM74m. (BMSB)
This news is positive but not entirely a surprise as PLUS had earlier indicated its intention to fulfill its 30% lane-km target for end 2009 with a potential acquisition of a foreign highway. This acquisition adds on to PLUS' existing three regional highways and also represents its 2nd acquisition of an Indian Highway. Indicative NAV of Padalur-Trichy Highway is beween RM150-200m based on an IRR of 15-18% which constitutes less than 1% of PLUS' total DCF value.

SapuraCrest’s 40%-owned Offshore International FZC (OIF) was awarded a US$75m subcontract by Larsen & Toubro to transport and install four platform jackets offshore Mumbai for ONGC. The subcontract is part of the main engineering, procurement, installation and commissioning contract which L&T had won from ONGC. OIF is expected to start the offshore work around mid-Nov using a pipelay barge called the LTS3000. (BMSB) Please refer to our note for comments.

The Rural and Regional Development Ministry will spend about RM2.1bn to provide rural basic infrastructures in Sabah and Sarawak under the National Key Result Areas (NKRA) this year. Its Minister, Datuk Seri Mohd Shafie Apdal, said the allocation also involved the completion of last year's projects to build new roads and provide water and electricity supply. Of the total about RM928m would be allocated to Sabah and RM1.2m for rural areas in Sarawak.
  • He said for NKRA's rural road projects, Sabah was allocated RM134.9m to complete 40 of last year's projects and another RM56.8m to implement 36 new projects, while Sarawak was allocated RM146m to complete 14 of the existing projects and RM352.3m to implement 62 new ones.
  • For NKRA's rural electricity supply projects, Sabah would get RM332m to complete 353 existing projects and RM81m to implement nine new ones, while Sarawak would get RM236m to complete 281 of last year's projects and RM56m to implement 10 new projects, he said.
  • Sabah and Sarawak would also receive of RM183m and RM211m respectively to implement rural water supply projects. (Bernama)
Sarawak needs coal-fired power to complement its hydro power generation, especially in Sarawak Corridor of Renewable Energy (Score) to meet high demand in energyintensive industries, Sarawak’s Second Minister for Planning and Resource Management Datuk Awang Tengah Ali Hassan said. “Yes, we know that coal is not a renewable energy. However, with the combination of resources, coal can be used as a source,” he added. (Bernama)

The14 initial public offering (IPO) applications received by the Securities Commission (SC) in 4Q09 reflected a higher interest in equity fund-raising by local and foreign companies. The number of applications was a 75% increase from the 8 IPO applications received in 3Q09.
  • The total IPO applications for 2009 stood at 35 compared with 23 in 2008. From the 35 IPO applications, the SC approved 12 and rejected two. 8 of the 12 companies had listed on Bursa Malaysia, including Maxis, which was one of the largest IPOs globally in 2009 having raised RM11.2bn from the market. (BT)
Indonesia is planning to set an exports quota for the tropical oil within the next five years in order to boost the by-product industry, Industry Minister M.S. Hidayat said. "For the downstream industry to grow, we need to limit exports by introducing a quota system," Hidayat said. In future, firms will be penalised for shipping more than their quota, while those who produce refined products will get incentives.
  • The government has projected this year's output to reach 23m tonnes, up from 21m tonnes in 2009. More than half of Indonesia's palm oil exports are in the form of crude palm oil, whereas rival Malaysia ships out mostly higher-value refined products. (Reuters)
Oil palm planters in Sarawak want a more “realistic” tax regime for the palm oil industry. This is especially for new planters with immature hectarage who also have to pay the hefty taxes, levy and cess imposed by the Federal and State Governments. Sarawak Oil Palm Plantation Owners Association (SOPPOA) chairman Datuk Abdul Hamed Sepawi said it was unfair to burden new planters with taxes based on the price of crude palm oil (CPO) as many of them were not even generating profits.
  • Given the shortage of mature areas, the cost of production among Sarawak planters is also the highest in the country at RM1,700 to RM2,000 for a tonne of CPO compared with RM1,100 to RM1,200 for the more efficient planters in Peninsular Malaysia. “We hope the proposed goods and services tax will improve our tax exposure. (Starbiz)
The oil palm industry has assumed a pivitol role in Sabah's economic development, Chief Minister Datuk Seri Musa Aman said. He said the industry also served as a catalyst for the development of other economic sectors such as transport, eco-tourism and livestock breeding. The oil palm industry, if managed systematically, can reap lucrative returns to the growers and contribute significantly to the state's economy," added Musa. (Bernama)

The much-awaited auction of radio waves for 3G in India is expected to garner at least Rs250bn (US$5.4bn) from private bidders, the communications minister A Raja said. "As the government has decided to hold the auction by February end, it is expecting to fetch the amount as a one-time payment from the bidders," he said. The government expects to garner 350bn (US$7.6bn) from sale of spectrum in this fiscal year. (Economic Times of India)

PAAB has submitted a proposal to take over the assets of water concessionaires in Selangor to the Energy, Green Technology and Water Ministry. However, according to a source, the ministry is combing through several fundamental issues before the offer can be made to the water players. “It’s not really moving as expected,” the source said.
  • It is believed that Minister Datuk Peter Chin has set a target of March 2010 for the restructuring process to be completed. “The restructuring hinges on resolving a few fundamental issues which are being ironed out now. Once resolved, the restructuring is probably 50% done. So, the target is (still) well on track,” said an industry source. (Star)
Kuwait Finance House (Malaysia) (KFHMB) is looking to buy Grade A commercial buildings and residential towers in Kuala Lumpur. "KFHMB prefer properties in the KLCC area. There are a few going below market value. Any transactions by KFHMB will be done outside of the bank's balance sheet," a source said.
  • He said KFHMB will set up a special real estate fund or entity to invest here, similar to what it did when it bought Glomac Tower and The Pearl @ KLCC. On KFHMB's move to not proceed with the purchase of half of YNH Tower on Jalan Sultan Ismail for RM920m, the source said the plan was aborted as the parameters had changed along the way. 
  • "From day one that we looked into the deal until now, there were a lot of variation. There were certain conditions that we stipulated, which were not met within the transaction," he said. (BT)
It is believed that Mizuho Financial Group may be pursuing one of several new banking licences that Malaysia plans to offer by 2012. Mizuho Financial Group Inc, Japan's third largest bank, says it is keen on obtaining a banking licence in Malaysia amid growing business opportunities between both countries. At present, the group has a representative office in Kuala Lumpur and an offshore branch in Labuan, under the Mizuho Corporate Bank banner.
  • "We would like to establish a reinforced structure and solid base in Malaysia in order to provide our customers with not just traditional lending and banking services, but also a full range of sophisticated financial solutions to meet their business development needs," a Mizuho spokesperson from the group's head office in Tokyo said (BT)
Genting Singapore’s Resorts World Sentosa (RWS) revealed that its four newly opened hotels 'have reached maximum capacity' until end-April but the IR ‘managed to free up some rooms’ in March and April. This past weekend (Jan 23-24), RWS saw occupancy rates at its four hotels soar to over 90%, said Robin Goh, assistant director for communications.
  • He added that both the Festive Hotel and the Hard Rock Hotel Singapore reported full houses. Already, every room during a nine-day period spanning the upcoming Chinese New Year holiday from Feb 13 to Feb 21 has been snapped up. (SBT)
Genting Singapore's Resorts World Sentosa has fired more than 30 casino employees. It was understood that the workers’ applications to work at the gaming tables were rejected by the Casino Regulatory Authority (CRA). No reasons were given, but it was likely that the affected workers had brushed with the law in the past. (Straits Times)

Malaysia Airlines
said its maintenance, repair and overhaul (MRO) services joint venture in India, MAS-GMR Aerospace Engineering (MAG), signed its first major deal with Jet Airways to provide heavy maintenance services for 10 years with the possibility to extend for another five years.
  • MAG is constructing its R400 crore MRO related facilities on a 250-acre site next to the Rajiv Gandhi International Airport in Hyderabad and is expected to begin operations by the first quarter of 2011 with management planning to make it into the preferred MRO service provide in the Indian subcontinent. (Malaysian Reserve)
Passenger and cargo traffic through the Senai International Airport in Johor is expected to grow significantly this year, driven by new airline services and projected new investments in Johor's Iskandar region, according to deputy chief executive officer Shahrull Allam Shah. Last year, the number of passengers using the airport fell 10% to 1.47m, while cargo volume dropped sharply to 5,200 tonnes due to the global economic crisis.
  • Senai Airport has a handling capacity of 4.5m passengers and 100,000 tonnes of cargo per year. Currently, airlines operating out of the airport comprise Malaysia Airlines, AirAsia and Firefly, while cargo airlines include MASkargo and Qatar Airways Cargo. The airport operator expects passenger traffic to increase to 1.6m by 2014, taking into account projected population growth within the Iskandar region from 1.4m in 2005 to three million by 2025. (BT)
Naza Group has lined up RM6.4bn of property projects this year and is in talks for its first overseas real estate foray in China. The company aims to more than double its property unit's revenue to RM2bn in five years. It has longer-term plans for a property trust and is drawing investors for a proposed 100-floor tower in Kuala Lumpur, CEO SM Nasarudin SM Nasimuddin said. (Bloomberg, Malaysian Reserve)

The property market in Malaysia is on an upward trend with middle class suburban property prices rising driven by the steady stock market movement. "However, the highend and high-rise property market is still in a cautious mode with property developed by branded developers expected to do well," said Ho Chin Soon, director of Ho Chin Soon Research.
  • Ho said demand for high rise properties in Kuala Lumpur was expected to continue due to limited land space. Ho said Malaysia was relatively sheltered from the global financial crisis (compared to the Asian financial crisis) and there was still an upside potential in property investment in Malaysia. (Bernama, Malaysian Reserve)
Plans to rejuvenate MK Land Holdings have hit a snag as three of its four COOs who were roped in to turn around the property development company are leaving. It is understood that there is a dispute over management of the company, controlled by tycoon Tan Sri Mustapha Kamal Abu Bakar.
  • Under the leadership of the four COOs, MK Land was recording average sales of RM30m/month, three times more than prior to their appointment. "With the key people leaving, there is a possibility it will impact the company's performance," the source said. (BT)
YTL Corp has proposed to use 81.5% of its proposed RM1.36bn bond issuance to refinance its 2007/2012 exchangeable bonds. Another RM230.26m would be used to finance future investments and/or repayment of borrowings. The remaining RM21m would be utilised within six months for expenses of the exercise. (Financial Daily)

Guinness Anchor (GAB) plans to spend about RM20m on Tiger Beer brand’s advertising and promotion activities for Chinese New Year and FIFA World Cup campaigns. Marketing manager who looks after the Tiger Beer business, Sean Koh said the company was expecting better sales for its Tiger Beer this year compared with last year, mainly due to encouraging momentum in the Year of the Tiger and its aggressive marketing campaigns. He expected a better business scene for the brewery market this year supported by the economic recovery and hoped this would improve spending sentiment. (Starbiz)

Ho Hup Construction Co has proposed to revamp its “initial regularisation plan” following fierce opposition from a group of shareholders led by its former MD. MD Lim Ching Choy said the revised scheme was “different” in structure from the original plan, but the ultimate goal remained the same – “to clean up the company’s balance sheet and to enable it to move forward.” The company has applied to the exchange for a three-month extension from 4 Feb to submit a revised regularisation plan. (Starbiz)

Hock Seng Lee (HSL) has secured a road construction job worth RM35.8m tendered from Sarawak's Works Department. Scope of the works includes earthworks, drainage, flexible pavement and bridges, expected to be completed by Feb-11. (Malaysian Reserve)

Yeo Hiap Seng (YHS) said the loss of the sales and distribution of 'Red Bull' products in Malaysia effective April 1 this year will cut group revenue by 10.8% and operating profit by 7.8% for FY10. (Malaysian Reserve)

Chemical Company of Malaysia (CCM) said its pharmaceuticals and fertilizers divisions plans to spend about RM119m for capital expansion in 2010. CCM expects to finance this via internal funds and bank loans, its group MD Datuk Dr Mohd Hashim Tajudin said. (Financial Daily)