Monday, January 11, 2010

20100111 1854 FCPO EOD Daily Chart Study.


FCPO closed : 2585, changed : -41 points, volume : Higher.
Bollinger band reading : neutral but sentiment turned negative.
MACD Histrogram : getting lower, selling activities accelerate.
Support : 2560, 2521 band level.
Resistant : 2630, 2680 level.
Comment :
Bearish export figures with record high stock level data ignite seller interest to come into the market with  heavy selling activities that also triggered lots of long covering pushed market to closed the day with a long body black bar candle. Technically speaking, FCPO chart still supported by the plotted upward trend line with a possible MACD bearish divergence forming. But the bearish sentiment does looks significant with today ultra high volume traded(highest since Oct 2009). Overall, market is still in an uptrend in the bigger picture and this could be a big correction in the making. Expect market to go side way range bound downside biased in the near term.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant/strength/break down with quick cut loss and profit target

20100111 1737 FKLI EOD Daily Chart Study.



FKLI closed : 1297.5, changed : +0.5 point, volume : Lower.
Bollinger band reading : still bullish.
MACD Histrogram : nearly unchanged, buyer and seller battle to continue tomorrow.
Support : 1290, 1286, 1280 level.
Resistant : 1300, 1309 level.
Comment :
The 2nd doji bar candle for FKLI shows that buyer is still defending the market well while seller strugelling to take charge of the market at the crucial resistant level(the 1300 level, tested for the 4th day). Daily chart wise, expecting market to go side way range bound upside biased as the uptrend remained intact.
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.

20100111 1312 FKLI Mid Day Hourly Chart Study.


FCPO closed : 1299, changed : +2 points, volume : High.
Bollinger band reading : bullish.
MACD Histrogram : climbing upward slowly. Buyer still in.
Support : middle Bolliger band, 1290 level.
Resistant : 1309 level.
Comment :
The crucial 1300 resistant level has been tested for the continuing 4th day on FKLI but has yet to closed above it. Nevertheless, hourly chart of FKLI still look bullish with further upside potential. The last 2nd hourly chart candle managed to touched the upper Bollinger band then followed by the last black small doji candle could suggest that market may take a break before going up further.

20100111 1245 FCPO Mid Day Hourly Chart Study.



FCPO closed : 2613, changed : -13 points, volume : High.
Bollinger band reading : bearish.
MACD Histrogram : recovering but the last one reserved slightly, neutral.
Support : 2600, 2560 level.
Resistant : middle Bollinger band, 2650.
Comment :
The released of weaker export data leads FCPO to a closed slightly lower with extremely high volume despite better soy oil and Dalian palm oil futures price. Hourly chart of FCPO still biased to a downside market with possible sideway range bound if the Bollinger band continue to turn inward.

20100111 0942 Malaysia Corporate News.

The Energy, Green Technology and Water Ministry has set an ambitious target of cutting the country's electricity usage by 60%. This will be achieved by replacing existing electrical appliances and gadgets in government buildings and street lights with the latest low-energy devices, said Minister Datuk Seri Peter Chin Fah Kui. (Starbiz) While such a target would seem negative for Tenaga’s power demand, we believe that this is a long-term target. Furthermore, it appears that the short-term focus will be on public lighting, a segment which currently only make up 1-2% of Tenaga’s monthly electricity sales.

Latexx Partners announced on Friday that it has entered into a joint venture (JV) agreement with its wholly-owned subsidiary Total Glove Company Sdn Bhd and Budev BV. Under the agreement, Total Glove will be the JV company set up to engage in the business of treating natural rubber latex examination and surgical gloves. Total Glove will market and distribute the gloves, which will have non-detectable level of proteins and allergens to prevent users from having an allergic reaction, Latexx said.
  • The technology for the JV is provided by Budev, a company incorporated under Dutch law and based in Amsterdam, the Netherlands. 
  • Latexx said the collaboration with Budev would provide the group with the opportunity and platform to produce a new product with higher margin to capture the huge demand of global customers.
  • The group also said that the new technical innovation will enhance its product range, enabling Latexx to reinforce its competitive edge in the global market. In this regard, the proposed joint venture is expected to contribute positively to the group's future earnings, it added. (Bernama) Please refer to our report today for comments.
Petra Perdana executive chairman and CEO Tengku Datuk Ibrahim Petra has exercised his executive powers to temporarily suspend senior management and key personnel of the company until 3 Feb.
  • He had earlier expressed shock and disappointment with the notice from 10 shareholders requisitioning an EGM, proposed to be held on 4 Feb, to remove four directors, including himself. 
  • The EGM would go on despite the requisitioners receiving suspension letters. “We are still shareholders. The suspension is pertaining to our employment and it does not change the shareholders’ rights. We are doing things merely to uphold the minority shareholders’ rights and for the good of the company," said executive director Shamsul Saad, who is also suspended. (Bernama, Star) Please refer to our note for comments.
Global Offshore is expected to get a contract worth RM350m from Petronas to lay oil & gas pipelines in shallow waters across Malaysia from Mar 10. The duration is for three years with options for two further extensions of one year each. It is believed that Kencana Petroleum will get a share of the contract as it will take a 45% stake in Global Offshore. (BT) This is the one package that SapuraCrest did not win in the recent award of a major offshore transport & installation contract. SapuraCrest's portion is worth RM8bn.

The ongoing internal probe at Alliance Financial Group's (AFG) banking unit is not related to fraud and will not have a material impact on the bank's earnings or balance sheet, a board member said. The speculations that the probe may involve the police or the Malaysian Anti-Corruption Commission are "not true", independent non-executive director Tee Kim Chan said at a briefing for analysts and fund managers last Friday.

  • He also denied that it had anything to do with a particular public-listed company or a multi-storey building. Tee, however, would not say what the probe was about, except that it would take about two to three weeks to complete.
  • Tee was also not able to say when the bank's CEO, Datuk Bridget Lai, would be back from her annual leave. Lai voluntarily took leave while the bank carried out the probe, he said. (BT) Please refer to our report today for comments.
The Sarawak Bank Employees' Union (SBEU) said it is against the proposed Hong Leong Bank’s takeover of EON Bank claiming that the exercise will result in reduced bank branches in Sarawak and job cuts. "SBEU is concerned on the adverse impact of the proposed takeover given that both banks originate from Sarawak," its CEO Andrew Lo said.
  • Lo said SBEU is not convinced that the merger will bring any long-term benefits to the new bank or its clients. "Mergers do not necessarily bring about improvement in efficiency,” Lo said, “Those who assert that there will be benefits should demonstrate them before they are allowed to merge. We (the union) have evidence that there is no clear link between bank mergers and improved efficiency." (BT)

CIMB Islamic has bagged the “Best Overall Islamic Bank” award as voted by the 5th annual Islamic Finance News Awards poll 2009. From the same poll, the bank also won the top spot in other categories namely “Most Innovative Islamic Bank” and “Best Islamic Bank in Malaysia. The bank also recorded a first when it was named “Best Islamic Wealth Management Provider,” while CIMB-Principal Islamic Asset Management was voted the “Best Islamic fund manager. (BT)

The are positive signs of recovery in the equities market especially, after Bursa Malaysia's market capitalisation hit RM1trillion last Tuesday, Bursa Malaysia's CEO Datuk Yusli Mohamed Yusoff said. "It is a feat last achieved in 2007 before the global financial crisis," he said. He said retail participation was also coming back - on the first day of trading this year retailers recorded an encouraging 34% (from some 20% in 2009). (Bernama, Starbiz)

Minister in the PM’s Department Tan Sri Nor Mohamed Yakcop has called on all agencies and departments to speedily resolve problems delaying the implementation of 9MP projects. "There should not be any more delay as all projects should be completed this year or at the very least, should start this year because next year we are already implementing projects under the 10MP," he said. (Bernama)

Oil palm plantation players hope the Government will review and restructure the tax, cess and levy imposed on palm oil, said Malaysian Palm Oil Association (MPOA) CEO Datuk Mamat Salleh. Apart from the corporate tax of 25%, he claims that the oil palm industry is burdened with additional taxes amounting to almost 40%, which is much higher than taxes imposed in other economic sectors in the country. He said the industry hoped that the proposed goods and services tax (GST) of 4% on the sale of fresh fruit bunches (FFB), CPO and exports of palm oil products would help offset some of the present taxes, which are based on the price of CPO, that were being imposed on planters. “With the tabling of the GST in Parliament, the palm oil industry is deeply concerned how it is going to affect them and they should start preparing from this year (2010) for its implementation in 2011,” Mamat said. (Starbiz)

Proton Holdings expects to complete a feasibility study on the consolidation of its car manufacturing plants by the end of the year. It has two plants in the country: in Shah Alam, Selangor, and Tanjung Malim in Perak and it is understood that the plan is to relocate the Shah Alam plant to Tanjung Malim where the facility occupies 518ha, 5x larger than the former. The Shah Alam plant can produce 230,000 cars annually while that in Tanjung Malim can make 1m. Talk of consolidating the two plants first surfaced during the stewardship of Tan Sri Tengku Mahaleel Tengku Ariff, who was the CEO until July 2005.
  • On Proton’s latest offering, the Exora, CEO Datuk Syed Zainal Abidin Syed Mohamad Tahir said it had secured 38,000 bookings and that 24,000 units were already on the road. Another 2,300 units have been sold in the Asean region, outside Malaysia. The Exora is sold in three Asean markets apart from Malaysia, namely Singapore, Thailand and Indonesia. It is set to be launched in the Middle East in the second quarter of this year. (BT)
From Jan 1, tyre retreaders have been told to apply for APs to import used tyres, a condition imposed by the Ministry of International Trade and Industry (MITI) to prevent unscrupulous parties from producing sub-standard tyres in a process called regrooving. Tyre retreaders would be required to get Standard and Industrial Research Institute of Malaysia (Sirim) standard certification as a requirement for the AP. "The AP policy was not property thought through. It just adds to our paperwork. If not handled well, we could end up losing a slice of the business to our neighbouring competitors," said one chief executive of a local rubber retreading company. (Malaysian Reserve)

The anticipated increase in demand for construction materials will not lead to spiraling prices, said Master Builders Association of Malaysia (MBAM). President Ng Kee Leen said the country’s liberalised cement and steel sectors would help improve supply to meet any demand surge. (Financial Daily)

Malaysia Building Society Bhd (MBSB) aims to almost triple its loan disbursements to RM3bn in 2010, partly helped by aggressive marketing campaigns. The lender also plans to grow its personal financing customer base to 150,000 from 50,000 currently. "We are still a new player in this (personal financing) segment. The RM3bn target we aim to achieve this year is small compared to the other players in the industry, whose target is worth some RM1.5bn a month," said assistant GM of Personal Financing-i Azman Aziz.
  • For 2009, the company's personal financing division registered RM1.1bn in revenue, higher than its initial target of RM1bn. 
  • Last year, the company exceeded its initial sales target by focusing on the public sector. It offered personal loans to the police force, teachers and other government servants. MBSB plans to do the same this year and get more borrowers from the private sector. (BT)
The anticipated increase in demand for construction raw materials, with the rollout of major construction projects this year, will not lead to spiralling prices, said Master Builders Association of Malaysia (MBAM). MBAM president Ng Kee Leen said the country's liberalised cement and steel sectors would help improve supply to meet any demand surge. (Financial Daily)

A study on the restructuring of toll rates which is now in its final phase, is expected to be completed in 1Q 2010. Minister in the PM’s Department Tan Sri Nor Mohamed Yakcop said, "We need to figure out a method that will not burden the people, but at the same time suit the country's financial situation.” (Bernama)

Celcom Axiata expects to double the number of foreign subscribers this year by launching a new prepaid pack that gives low rates for international calls. Senior vice-president for marketing Zalman Aefendy Zainal Abidin said there is almost three million foreign workers in Malaysia and they spend double what locals do on phone calls. "Foreign workers pay two times more on phone bills as they are always calling home. It's a big market. More than 60% of calls which they make comes from IDD (international direct dial)," he said. (BT)

The almost saturated mobile telco market in Malaysia is prompting Celcom Axiata to aggressively offer new products in 1Q10. Senior VP for marketing, Zalman Aefendy Zainal Abidin, said this could be achieved with the launch of the latest Celcom Sukses package, which now includes 10 other countries, as well as having its second Celcom sale. "Our market is coming to 100% being saturated. Our activities are now not only on getting new customers but also having a lot more content and services for existing customers as well," he said. (Starbiz)

Container traffic through Port Klang, the country's busiest container port, fell by 8.3% last year, as the global economic downturn continues to hurt the country's exports.
  • The port handled 7.3m TEUs compared with 7.9m TEUs in 2008. More than half, or 61% of the container volume, was from Westports, which generated 4.451m TEUs. Northport accounted for the remaining 39% or 2.858m TEUs. 
  • Port Klang Authority (PKA) general manager Kee Lian Yong said the decline in container and cargo throughput is in line with the global trend. "(Nevertheless,) the port's container volume was better than our earlier forecast of a 10% drop. Overall Port Klang also fared better than other major ports in the world, which saw a 10-15% drop in traffic," he said. Kee said Port Klang is expected to post throughput growth in 2010, returning to 2008 volume of 8m TEUs. (BT)
PLB Engineering has been sued under a corporate guarantee after unit PLB-KH Bina allegedly failed to complete works on a mixed development project in Georgetown, Penang. Hunza Properties (Gurney) and Hunza Properties (Penang) jointly claims that PKB-KH "failed to proceed regularly and diligently" with the works under the contract, according to a filing to Bursa Malaysia. (Malaysian Reserve)

Cahya Mata Sarawak’s (CMS) wholly-owned subsidiary Concordance Holdings and 51%- owned PPES Works (Sarawak) will sell their combined 37.2% equity interest in UBG Bhd to PetroSaudi International Ltd for RM465.5m. The proceeds would be used to tap investment opportunities which could potentially provide higher yield and returns. “In comparison, CMS’ current investment in UBG is only at an associate level; thus the cashflow contribution from UBG is limited to dividend payments." it said. (Star, BMSB)

Crest Builder bids for some RM3bn worth of private and public jobs in the country in the current fiscal year. Director Eric Yong Shang Ming said the builder was eyeing areas with "less projects, competition and players" such as flood mitigation and water treatment plant jobs, on top of its staple undertakings in real estate construction. Crest hopes to secure RM500m worth of construction projects. The builder currently has construction orderbook of RM1.5bn and unbilled sales of RM1bn. (Financial Daily)

Lembaga Tabung Haji is set to play a major role in Ramunia's restructuring exercise, which could transform the latter into a major infrastructure group. TH Technologies Sdn Bhd, which recently accepted the delivery of a vessel, could be injected into Ramunia. The company also has a 28% stake in Roadcare (M) Sdn Bhd, which has a 15-year concession that ends in 2016 to maintain federal roads in Selangor, Pahang, Terengganu and Kelantan. (Edge Weekly)

Berjaya Corp has proposed to acquire a 56% stake in Graphic Press Group Sdn Bhd from Far East Digital Prints Sdn Bhd and HSPL Pte Ltd for RM5.61m. The proposal will result in Graphic Press becoming a 70% subsidiary of Berjaya Group, from just a 14% investment previously. (Bernama)

IGB Corp, which owns and operates the MiCasa All Suites Hotel in Kuala Lumpur, is still interested in selling the property - but the price tag is much higher now. ED Tan Boon Lee said the hotel, which reopened last month following a two-year RM85m renovation exercise, is now valued at RM250m. (BT)

Talam is on track to emerge from its PN17 status, even as its debt regularisation plan was being delayed by prolonged negotiations on assets disposal, ED Chua Kim Lan said. "At the moment we are finalising two sale and purchase agreements involving sale of land and building. Once completed, the proceeds will be used to pay off the outstanding defaulted loans." she said. Talam is looking at disposing about 3,000 acres of land from its landbank of 7,000 acres. The largest tract of land to be disposed would come from the company's Bandar Bukit Beruntung development. (Financial Daily)

Gadang Holdings is upbeat on the property outlook for this year and planning several new developments in the Klang Valley, say MD Tan Sri Kok Onn. The company has 46ha of prime land in the Klang Valley, Penang and Johor for development and he was expecting the landbank to generate a gross development value exceeding RM700m over the next five years. Gadang will build medium- to high-end houses, condominiums, offices and shoplots.
  • Gadang's ongoing developments are mostly priced in the medium range. They include retail, office suites and three-storey superlink homes in Segambut, Kuala Lumpur; medium- and low-medium-cost apartments in Sungai Buloh, Selangor; and single-storey terraced houses and single-storey semi-detached houses in Rawang, Selangor. However, Gadang will be moving to the Mines area in Seri Kembangan, Serdang, within the next 12-15 months to develop seven super-luxury bungalows, worth a combined RM40m, or more than RM5m each. (BT)
Ho Hup Construction may sell part of its land in Bukit Jalil, Kuala Lumpur, if the funds raised from an alternative revamp plan is not enough to finance its developments, said Datuk Low Tuck Choy. Low is the second biggest shareholder of Ho Hup and is trying to block an existing restructuring plan, which involves a 95% capital reduction. His alternative plan involves raising RM25.5m from a rights issue. (BT)

Technodex, which specialises in business solution programmes, aims to raise its share of the online gaming market by setting up a centre in the country to develop online games. MD and CEO Lee Siew Tat said the company hopes to do this by 4Q 2010. "The local centre will be built through a technology transfer from our business associate in China and we hope to expand into the English market as well," Lee said. Meanwhile, Lee said that Technodex planned to transfer its listing status from ACE to the Main Market this year. (BT)

Hiap Teck Venture’s move to buy 55% of Eastern Steel Sdn Bhd to produce steel slabs by 2012 is a worthwhile business move to leverage on the benefits of AFTA, said group MD Kua Hock Lai. "Currently, there is a mismatch between the steel slab demand for downstream hot-rolling activities versus the steel-making capacities in Asean. Downstream players here, in Thailand, the Philippines and Indonesia are all importing slabs from the European Union, Turkey and Brazil," he said. (BT)

Indonesia's national carrier Garuda Indonesia plans to reinstate its flights from Kuala Lumpur to Denpasar in Bali and Medan by September 2010, six years after the service was halted.
  • Joseph Tendean, general manager for Malaysia, said Garuda will use its new 737-800 aircraft to fly daily from Kuala Lumpur to the two destinations. "We have the landing rights and will apply for a time slot in mid-2010," he said recently. Garuda stopped air travel from KL to Denpasar and Medan in 2004 due to poor traffic mainly due to the Bali bombings.
  • Garuda, which made operating revenue of RM7 billion last year, currently operates one daily flight for its KL-Jakarta-Lombok-Jakarta-KL route. "Our load factor for the KLJakarta- KL route is around 70 per cent. This is an amazing increase from 45 per cent last year when it first started," Tendean said. The flight to Lombok was introduced on November 1 this year. Garuda is using its 737-300 aircraft for the service but will switch to 737-800 in May 2010. (BT)
Bintai Kinden Corp (BKC) said its 70% subsidiary, Bintai Kindenko has won a RM134.2m sub-contract from the National University of Singapore (NUS). The contract involves the supply, delivery, installation, testing and commissioning and maintenance of airconditioning and mechanical ventilation installation, electrical installation and fire protection installation for the NUS University Town Development. (BT)