20100121 1038 Malaysia Corporate News.

Genting Singapore opened four hotels at Resorts World Sentosa (RWS) yesterday. Genting Group chairman Tan Sri Lim Kok Thay said his company was still working with the Singapore authorities on finalising the casino licence and gave no date for the start of gambling operations.

• A government agency said Genting Singapore may get the casino licence by end-Feb or in March, according to Bloomberg. The Casino Regulatory Authority received RWS's complete licence application in Dec-09, Vivian Heng, the authority's spokeswoman, said. 
• "Based on the experience of other jurisdictions, typically such probity investigations may take about three months or more if all the documentation is complete and in order," Heng said.
• Meanwhile, Lim said a decision by Universal Studios to build its biggest theme park in Asia in South Korea was unlikely to negatively affect its attraction in Singapore. (AFP, Bloomberg)
  

This news appears to be a slight negative as the suggested timeline for the opening of the casinos is later than our pre-Chinese New Year expectations. But we note that RWS first submitted its casino licence application in Oct-09 and followed up with another submission in Dec-09. This means that the pre-CNY timeline is still a possibility. We continue to believe that it is in the interest of both RWS and the Singapore government for a debut that will capture the CNY festivities.

The total industry volume (TIV) of new motor vehicles for 2009 eased marginally by 2% to 536,905 units, compared with the 548,115 units registered in 2008, said the Malaysian Automotive Association (MAA). Its president Datuk Aishah Ahmad said the auto industry was badly hit by the economic downturn in the first half of 2009 but the situation begun to improve, particularly during the last quarter of the year.

• She noted that the better performance in 2009 was also supported by the introduction of stimulus packages and liberalisation of the services sector, as well as the capital market, to attract more investment into the country. (Bernama)

The vehicle sales in 2009 of 536,905 units came in slightly above our projection of 531,672 units.

Perodua hopes to sell 176,000 vehicles this year from 166,700 units last year or a growth of 5.6%, said its managing director Aminar Rashid Salleh. He said the anticipated stronger sales would be driven by the new ALZA model, and its main stays, Myvi and ViVA, against a backdrop of a 5.0% economic growth forecast by the Economic Planning Unit in the Prime Minister's Department.

• He said Perodua would not introduce any new model this year but would introduce enhancements to its existing models where the emphasis would be on "going back to the basics to bring about greater customer satisfaction". (Bernama)

Mercedes-Benz Malaysia aims to achieve sales of about 4,200 passenger cars this year with the global market and the automotive industry showing signs of recovery. Its President and Chief Executive Officer, Peter Honegg said the company also hoped to sell 1,500 units of the Mitsubishi Fuso commercial vehicle as well another 200 units of commercial vehicles.

• "We are encouraged by our performance and will continue to build on our leadership in 2010. We are aiming to generate sales at least similar to what we did in 2008," he said. (Bernama)

Tenaga Nasional expects to maintain its improved earnings in its 1QFY10 for the rest of the financial year ending Aug 31, 2010, said its president and CEO Datuk Seri Che Khalib Mohamad Noh.

• "We will definitely do better this year than we did last year," he said, but warned against higher coal cost as the price of the commodity continued to trend upwards as a result of the bitter cold front crossing the northern hemisphere. 
• Asked if the government had approached Tenaga on the subject of a tariff increase, Che Khalib said the company had not heard anything on the matter but that regular discussions were ongoing.
• Che Khalib also responded to reports that the Bakun hydroelectricity dam project had stalled, saying it was still ongoing.
• As for Tenaga's two new up-and-coming hydroelectricity plants - Hulu Terengganu and Ulu Jelai - Che Khalib said the latter still had two packages to be awarded. (Financial Daily)
  

Maxis is testing new devices and will roll them out in the Malaysian market when they are ready. "We will introduce the devices when we are comfortable that we can provide the end-to-end management in terms of technical help and sales when we roll them out," said vice-president and head of enterprise and carrier business Mohamed Fitri Abdullah. Separately, Maxis signed a partnership agreement with Limkokwing University of Creative Technology to provide discounted iPhone 3Gs with special packages to its students. (BT)

The latest policy flip-flop by the Department of Telecom (DoT) of India could drive away foreign players from the upcoming 3G auctions by denying them a fair chance of getting 2G spectrum, vital for offering a full complement of telecom services. Absence of foreign players may cost the government billions of dollars in revenues.

• Global telcos, with no presence in India, are unlikely to enter the 3G race unless they can offer full-fledged mobile services. Fresh entrants in India’s telecom scene who win 3G spectrum, in the auctions to be held next month, will be placed last in the queue of 343 applicants for 2G airwaves, DoT said in response to bidders’ queries. 
• The move is heavily loaded in favour of existing players in the telecom space that offer services on 2G airwaves. (Economic Times of India)
  

The Indian government said radio wave auctions for 3G, will be completed by the end of Mar 10. "The government is very keen to complete the 3G auction process well within the financial year (Mar 31, 2010)," Telecom and IT Minister A Raja said. He added the notice inviting application for the 3G auction is likely to come out this week. (Economic Times of India)

Stewart Forbes, executive director of the Malaysian International Chambers of Commerce and Industry (MICCI) also said the Malaysia must pay attention to foreign equity limits, environment and security standards, and infrastructure particularly broadband communications if the country wants to boost its flagging foreign direct investment, says the country’s oldest business association.

• “The broadband has to meet international standards. The ICT infrastructure in Malaysia is a limiting factor and doesn’t meet the needs of high tech industries." Forbes also cautioned that the country’s practice of being generally protective of local industries made it difficult for it to implement reforms such as opening up the economy. 
• “If you want 100% protection, you cannot do major changes but can only do tiny changes. It is not acceptable to take baby steps, but you need to take large steps to a new economy. Everyone is moving fast now,” he added “If you move too slow, you will be overtaken.”
• Forbes also suggested that the country look to importing the talent it needs in order to scale up its skills capacity and highlighted the difference in the number of expatriates in Malaysia and its neighbours. He said it is easier now than before to bring in expatriates but the number, currently about 38,000, is still “critically low.” (The Malaysian Insider)
  

Malaysia's mills have raised their billet export offers by over 6% this week in response to higher scrap costs.Offers have gone to US$495-500 fob per tonne, from US$465-470 fob per tonne last week. The latest scrap offers of HMS 1&2 (80:20 mix) offered by Australia and Europe into Malaysia have risen to US$380-390 per tonne cfr, from US$350-370 per tonne early this month.

• Transaction prices, meanwhile, still average US$380 per tonne cfr. "Demand for billet has gone up now. Many are anticipating billet prices will go up even further, and thus have started buying," said an official at a Malaysian mill. Also, Malaysia's offers are competitive against offers from Turkey, Russia and Korea of around $515 per tonne cfr Southeast Asia, said sources. (Metal Bulletin)

Alliance Financial Group has appointed Eric Lee as its group chief financial officer (CFO). The appointment takes effect from January 4. Lee will be responsible for the overall strategy and management of group finance. Lee is filling a post that has been vacant for many months.

• Philip Goh, the previous group CFO, left the company sometime last year. Prior to joining the group, Lee was the CFO of a major global company where he led the finance operations in the Greater China region. He brings with him a wealth of experience of more than 20 years, AFG said. (BT)

Malaysia Airports Holdings Bhd hoped that low-cost carrier, AirAsia will pay the airport tax it owed more promptly, said its chairman, Tan Sri Dr Aris Othman. Aris said this when asked on the progress of the payment. (Bernama)

AirAsia has introduced Web and Self Check-In services at the LCCT airport and selected regional airports, providing guests with a quicker and more convenient way of checking-in. This major initiative is part of the airline’s on-going mission of using the ICT forefront to exploit technology and practice cost efficiency. (Press release)

Local rubber prices rallied to a two-year high yesterday on tight supply and expectation of increasing demand from China, the world’s largest rubber importer. Tyre-grade Standard Malaysian Rubber (SMR 20) closed at RM10.32 per kg, up RM1.15 while Latex-in-Bulk advanced RM1.25 to RM6.87 per kg.

• A rubber trader told StarBiz that poor weather conditions affecting major rubber producing countries like Thailand and Malaysia have raised concerns over potential tightness in rubber supply over the next five months. China is also expected to increase its rubber purchases given the continued economic growth seen this year which may lead to a pick-up in its automotive industry and demand for tyres. (Star)

With land and port deals virtually sealed, Vale’s plan to build a distribution centre in Perak is set to kick off this year. The first phase will involve US$900m in capital expenditure, including US$98m in 2010. Vale, which describes itself as the second largest diversified metals and mining company in the world, expects to enlarge its market presence in Asia once the distribution centre is up and running some three years from now.

• The centrepiece will be a pelletising plant, which converts raw iron ore into pellets that are used in steel production. Integrax earlier announced that 80%- owned Lekir Bulk Terminal Sdn Bhd had entered into an agreement with Vale International to provide the latter with transhipment services for iron ore cargo at a bulk terminal at Pulau Lekir Satu, also in Teluk Rubiah, over 10 years. (Star)

Leader Universal Holdings has secured a project from the Cambodian government for a US$107m (RM358.4m) power transmission system in the country. Leader will develop a 230KV power transmission system from Phnom Penh to Kampong Cham. Kampung Cham is the third largest city in Cambodia and 124km from Phnom Penh.

• "The project fulfils part of the planned development of the Cambodian grid system and provides for the future 230 kV extension to other parts of the country around Tonle Sap where Southeast Asia's largest freshwater lake is found," says Leader's MD Datuk Sean C.H. H'ng. 
• The project will include the construction of a North Phnom Penh substation and 110km of double-circuit 230kV overhead transmission lines from north Phnom Penh to Kampung Cham. Leader, via 60%-owned subsidiary Cambodian Utilities Pte Ltd, is the first independent power producer in Cambodia, where it began operations in 1997.
• The company is also currently developing a 100 megawatt coal-fired power plant project in Sihanoukville, Cambodia, via its 80 per cent-owned subsidiary, Cambodian Energy Ltd. The plant is expected to be in operation towards the end of 2012. (BT)
  

A mixed property development project has been proposed for the site located directly across The Renaissance Kuala Lumpur and next to the Sunway Tower, says Kuala Lumpur City Hall (DBKL) mayor Datuk Ahmad Fuad Ismail.

• The developer of an abandoned hotel project at the junction of Jalan Sultan Ismail and Jalan Ampang in Kuala Lumpur has submitted a new proposal for a mixed development project on the site,which was previously slated for the opening of the five-star The Grand Duta Hyatt hotel. 
• However, the project was stalled due to the 1998 Asian economic crisis. Fuad has received an application from the developer for a 52-storey mixed development project consisting of service apartments, offices and a hotel. "We have approved (the project) over six months ago for service apartments, offices and a hotel," says Ahmad. (BT)
  

Sunway Holdings has signed a share sale agreement with Templer Forest Resort for the proposed acquisition of 60% equity interest in Spanland for RM13.8m. Spanland has the development rights for a 98-acre plot in Gombak opposite the Templer Park Country Club.

• The site has been proposed for a project comprising 163 bungalows with an estimated gross development value (GDV) of RM500m. Sunway managing director Yau Kok Seng said with the proposed acquisition, Sunway’s land bank would be increased to 390 acres with potential GDV of some RM2bn. (Starbiz)

The Port Klang Free Trade Zone (PKFZ) in Pulau Indah, Selangor, is "very much alive", although it is still embroiled in controversy and lawsuits over its ballooning cost overruns, says general manager Chia Kon Leong. Last year, the free zone saw its container traffic rise almost five times to 43,032 TEUs from 9,112 TEUs in 2008.

• The growth was due to increased economic and logistics activities culminating from new investments and growth of existing businesses in PKFZ. As at end-December 2009, PKFZSB has attracted 56 companies into the zone with total proposed investments of RM936.1m. (BT)

Ann Joo Corp, the single largest shareholder of Ann Joo Resources (AJR), disposed of nearly 20m shares in the latter recently. After the recent disposals, AJC's stake was reduced to 64.69%, comprising 325.19m shares in AJR. (Financial Daily)