Wednesday, December 27th, 2017

 

Wall Street little changed; oil drop weighs on energy shares

NEW YORK, Sept 27 — US stocks were little changed in morning trading today, with gains in healthcare and technology stocks helping offset losses in energy shares. Oil prices fell after hitting a near two-and-a-half year high in the previous…


An investor’s best friend: China’s booming pet market sparks deals (VIDEO)

SHANGHAI, Dec 27 — Li Mingjie is a pet industry investor’s dream. The 23-year-old e-commerce worker spares little expense to make his pooch happy. “I’ll happily splash out on my dog,” Li told Reuters as he walked his brown poodle Coco…


1MDB completes payment to Abu Dhabi’s IPIC

PETALING JAYA: State-owned strategic investment fund 1Malaysia Development Bhd (1MDB) has made the remaining payment due by year-end to Abu Dhabi’s International Petroleum Investment Co PJSC (IPIC) under a settlement agreement between IPIC and Minister of Finance (Incorporated) Malaysia (MoF Inc) and 1MDB.

“Further to the announcement of Aug 30, 2017, IPIC has now received all the funds required to be paid to IPIC by Dec 31, 2017 under the settlement with MoF Inc and 1MDB and the consent award made on May 9, 2017,” IPIC said in a filing with the London Stock Exchange today.

IPIC did not mention the amount paid by 1MDB, but it was reported that the last payment is US$602.73 million (RM2.46 billion), which is the final tranche of its US$1.2 billion (RM4.9 billion) debt owed to the Abu Dhabi state fund.

1MDB previously made a payment due by the end of August 2017 to IPIC, albeit a delay as it was unable to receive proceeds from its rationalisation plan on time.
Meanwhile, 1MDB also issued a statement today, saying all funds were paid from proceeds of the on-going rationalisation programme.

“1MDB is pleased to announce that pursuant to the Settlement Deed with MoF Inc Malaysia and IPIC, 1MDB has remitted to IPIC, in full, all the funds required to be paid to IPIC by Dec 31, 2017,” it noted.

1MDB’s rationalisation plan involves, among others, a “debt for asset swap” with IPIC, the sale of Edra Global Energy Bhd to China General Nuclear Power Corp for RM9.83 billion, master-planned land development in Tun Razak Exchange and disposal of non-core assets.

The Bandar Malaysia deal with Iskandar Waterfront Holdings Sdn Bhd and China Railway Engineering Corp (M) Sdn Bhd was aborted early this year.


Inix Technologies aims to be back in the black in current financial year

SHAH ALAM: Loss-making software solutions provider Inix Technologies Holdings Bhd aims to turn profitable in its current financial year ending July 31, 2018 (FY18) as it focuses on growing its mobile solutions business and dredging works.
Speaking to reporters after the group’s AGM yesterday, its CEO Dr Azman Hussin (pix) said the group expects continued income from Hyper QB Sdn Bhd, a mobile solutions company in which it acquired a 25% equity interest in April 2016.
Azman said the ACE Market-listed group is in the midst of acquiring the remaining 75% stake in the mobile solutions company.
“We still incurred losses in our FY17 results, so with this acquisition and our present business, we hope to achieve better results and at least see some profit in FY18,” he added.
The group’s net loss almost doubled to RM8.87 million in FY17, from RM4.7 million a year ago, due to losses contributed by associates and equity-settled share-based payment expenses.
Azman said Inix is also banking on its mobile app platform called BizApp, which is developed by its subsidiary ANSI Systems Sdn Bhd, to help small and medium-sized entrepreneurs manage their business.
“We just kicked off the mobile app in June last year and we expect to achieve 2,000 paid users by end of this year,” he added.
As of November 2017, Azman said, about 1,800 paid users have subscribed to its mobile app, with the total monthly sales transacted on the BizApp platform crossing the 14.5 million mark during the period.
Recently, the group granted a five-year non-exclusive, non-transferrable license to Universiti Teknologi Mara to use the BizApp platform. The deal is expected to contribute positively to the group’s earnings in FY18.
On its dredging and land reclamation services business, Azman said the group sees huge potential in the industry going forward, noting there are only a few players in the field currently.
Inix made its entry into the dredging and land reclamation business in 2015 by acquiring a 30% stake in Galactic Maritime (M) Sdn Bhd for RM7.2 million. Galactic Maritime is principally involved in the provision of reclamation dredging and environmental protection dredging services.
Inix increased its stake in Galactic Maritime to 49% earlier this year, as the latter continued to be profitable after the initial investment and had met the profit guarantee it had given then.
Inix’s share price rose 4% to close at 13 sen yesterday on some 14.49 million shares done.


Osram: Fire damage minimal, production not affected

GEORGE TOWN: Opto semiconductor and lighting solutions producer Osram Opto Semiconductor (Malaysia) Sdn Bhd, one of the largest multinational companies in the northern region of Peninsular Malaysia, said damage resulting from a fire which broke out at one of its plants in Bayan Lepas Free Industrial Zone, Penang, on Sunday is small in scale and has not affected production.

Osram Opto Semiconductor’s production has since resumed following the fire.
“Production stopped for a while as the power supply was down and it has resumed in stages,” its head of site communication Audrey Cheah told SunBiz via email.

“The damage has not been fully quantified yet, but seems to be on a small scale, not affecting production,” she added.

With that, the German firm is not expecting any disruptions to its product delivery due to the incident.

Cheah said this in response to a social media post that a small fire was detected at Osram’s Penang facility at 9.30am on Sunday, which was “quickly extinguished by the Fire Brigade and onsite emergency response teams”.

Videos and photos of the incident showed smoke billowing from one of the plants and staff gathered at the plant’s compound surfaced on Facebook on Sunday. At press time, the post has been shared 4,563 times.

There were no injuries reported from the incident.

On what caused the fire, Cheah said investigations from the Fire and Rescue Department are still underway.

Osram, which has eight plants in Penang, has had a footing in Malaysia for decades.

International Trade and Industry Minister Datuk Seri Mustapa Mohamed was recently quoted as saying that as the largest employer in the northern region, Osram’s total investment as at October this year stood at RM4.2 billion. It is also expected to offer up to 7,790 jobs by 2020.


Geely buys 8.2% stake in truck maker AB Volvo

STOCKHOLM: China’s Geely Holding, which already owns the Volvo Car Group, is buying an 8.2% stake in Swedish truck maker AB Volvo from activist investor Cevian Capital for around US$3.3 billion (RM13.5 billion).

Volvo Car Group was split from AB Volvo almost 20 years ago and Geely said it was not its current intention to try to reunite the two businesses.

“Given our experience with Volvo Car Group, we recognise and value the proud Scandinavian history and culture, leading market positions, breakthrough technologies and environmental capabilities of AB Volvo,” Geely chairman Li Shufu said in a statement today.

Geely’s expertise in the Chinese market and skills in developing electric and autonomous vehicles should help the truckmaker to expand, he added.

AB Volvo owns 45% of Dongfeng Commercial Vehicles, one of China’s largest truck makers, and also has a significant construction equipment business in China.

The value of the investment amounted to around 27.2 billion Swedish crowns (US$3.26 billion), a Reuters calculation showed, although Geely and Cevian did not disclose the exact value of the transaction in their statement today.


Nepal court allows Axiata’s Ncell to repatriate dividend earnings

PETALING JAYA: The Supreme Court of Nepal has ruled in favour of Axiata Group Bhd’s 80%-owned subsidiary Ncell Pvt Ltd, allowing the Malaysian telco giant to repatriate dividends earned by its unit out of Nepal to the tune of 72 billion rupees (RM2.84 billion) following a legal tussle on capital gains tax settlements.

The Himalayan Times reported that justices Om Prakash Mishra and Kedar Prasad Chalise pronounced in their verdict that disallowing Ncell to repatriate its dividend will adversely affect the company and its stakeholders.

The apex court also stated that any company operating in Nepal, as per the Foreign Investment and Technology Transfer Act, 1992, can repatriate its profit out of foreign investment in Nepal in foreign currencies.

The court reportedly heard that the move of blocking Ncell from repatriating its dividend earnings is illogical as the telco has cleared all of its capital gains tax (CGT) in the buyout deal, while TeliaSonera, the previous owner of NCell is liable to settle its CGT owed to the government.

Axiata said in July that it had been fully cleared of the CGT payment with a further advance deposit 13.6 billion rupees by Nepal’s Large Taxpayers Office as per the directive of the agency. Ncell had made a payment of 9.9 billion rupees in May 2016.

In December 2015, Axiata acquired a 80% stake in Ncell from Swedish telco TeliaSonera for US$1.365 billion (RM5.87 billion) through a deal which was subjected to CGT.

TeliaSonera, which exited the country, owed about 10% of the CGT to the Nepali government. This had prompted the Nepali government to bar the repatriation of dividends by Ncell until the CGT issue was settled.

On Bursa Malaysia today, Axiata ended unchanged at RM5.38 with some 3.21 million shares changing hands.


Nepal court rules in favour of Axiata unit

PETALING JAYA: The Supreme Court of Nepal has ruled in favour of Axiata Group Bhd’s 80%-owned subsidiary Ncell Pvt Ltd, allowing for the Malaysian telco giant to repatriate the dividends earned by its unit out of Nepal to the tune of 72 billion rupees (RM2.84 billion) following a legal tussle on capital gains tax settlements.

The Himalayan Times reported that Justices Om Prakash Mishra and Kedar Prasad Chalise pronounced in their verdict that disallowing Ncell to repatriate its dividend will adversely affect the company and its stakeholders.

The Apex court also stated that any company operating in Nepal, as per the Foreign Investment and Technology Transfer Act, 1992, can repatriate its profit out of foreign investment in Nepal in foreign currencies.

The court reportedly heard that the move of blocking Ncell from repatriating its dividend earnings is illogical as the telco has cleared all of its capital gains tax (CGT) in the buyout deal, while TeliaSonera, the previous owner of NCell is liable to settle its CGT owed to the government.

Axiata said in July that it had been fully cleared off the CGT payment with a further advance deposit 13.6 billion rupee by Nepal’s Large Taxpayers Office as per the directive of the agency. Ncell had also made a payment of 9.9 billion rupee in May 2016.

In December 2015, Axiata acquired a 80% stake in Ncell from Swedish telco TeliaSonera for US$1.365 billion (RM5.87 billion) through a deal which was subjected to CGT.

TeliaSonera, which exited the country, owed about 10% of the CGT to the Nepali government. This had prompted the Nepali government to bar the repatriation of dividends by Ncell until the CGT issue was settled.

Axiata’s shares were unchanged at RM5.38 today with some 3.21 million shares changing hands.


Analysts see TNB in positive light

PETALING JAYA: Analysts remain positive on Tenaga Nasional Bhd (TNB) after the government announced that the electricity tariff will not be changed for the peninsular until 2020.

At today market close, TNB’s share price gained 14 sen or 0.9% to RM15.12, with some 10.34 million shares changing hands.

HLIB Research said TNB will get compensation of RM900 million from the government in order to cover its higher energy fuel costs under the Imbalance Cost Past Through (ICPT) mechanism. It has assumed lower return on assets (ROA) for coming period 2018-2020.

“The announcement will allay investors’ concerns on government’s commitment in honouring the Incentive Based Regulation (IBR) and ICPT mechanisms even in the event of high fuel costs,” the research house said in a report today.

HLIB Research expects TNB’s earnings and cash flow to be stable due to the implementation of the IBR/ICPT mechanisms.

“The expected IBR revision to lower return on regulated assets by 2018 will be offset by new contributions from associates and power plants. Shareholders also stand to benefit from higher dividend payout.”

The research house is maintaining a “buy” call on TNB with an unchanged target price of RM17.

Meanwhile, AnInvestment Bank Research and MIDF Research both remain “overweight” and positive respectively on the power sector, with TNB as its top pick in the sector.

MIDF said key catalysts for TNB are dividend catalyst on the back of an under-geared balance sheet and capital optimisation exercise; overseas expansion provides scope for stronger growth in the mid-term; strong earnings visibility post-ICPT implementation and at just 12 times FY18 forecast price-to-earnings ratio, TNB trades at a discount to sector average of 13 times and the index’s 16-17 times.

It added that the development on base tariff is positive, pending further details of actual components making up TNB’s required revenue for the second regulatory period (RP2) from January 2018 to December 2020.


Kinsteel to be suspended from Jan 5

PETALING JAYA: Trading in the securities of Kinsteel Bhd, Practice Note 17 (PN 17) company, will be suspended with effect from Jan 5, 2018 as Bursa Securities has rejected its application for a further extension of time to submit its regularisation plan.

The company will be delisted on Jan 9, 2018 unless an appeal is submitted to Bursa Malaysia Securities Bhd on or before Jan 4, 2018.

“In the event Kinsteel submits an appeal to Bursa Securities within the appeal timeframe, the removal of the securities of the company from the official list of Bursa Securities on Jan 4, 2018 shall be deferred pending the decision on the company’s appeal,” it said in a stock exchange filing today.

The securities of Kinsteel, which are currently deposited with Bursa Malaysia Depository Sdn Bhd (Bursa Depository), may remain deposited notwithstanding the delisting of the securities. It is not mandatory for the securities of a company which has been delisted to be withdrawn from Bursa Depository.

Alternatively, shareholders of the company who intend to hold their securities in the form of physical certificates, can withdraw these securities from their Central Depository System accounts maintained with Bursa Depository at any time after the securities of the company have been delisted.

This can be effected by the shareholders submitting an application form for withdrawal in accordance with the procedures prescribed by Bursa Depository.

Upon the delisting, the company will continue to exist but as an unlisted entity. The company is still able to continue its operations and business and proceed with its corporate restructuring and its shareholders can still be rewarded by the company’s performance. However, the shareholders will be holding shares which are no longer quoted and traded on Bursa Securities.

Kinsteel closed unchanged at 2.5 sen today with 510,000 shares done.