Wednesday, January 10th, 2018

 

Wall Street slips after report China may slow US bond purchases

NEW YORK, January 10 — Wall Street’s major indexes slipped today, stalling the rally that marked the start of 2018, after a report that China is considering slowing or halting purchases of US government debt. Apple, Microsoft and Amazon were…


Stocks In Focus (11-1-2018)

KUALA LUMPUR (Jan 10): Based on corporate announcements and news flow today, companies in focus on Thursday (Jan 11) may include: AirAsia, LPI Capital, AYER,…


Buffett says he will never invest in cryptocurrencies

NEW YORK, January 10 — Berkshire Hathaway’s Warren Buffett said today he will never invest in cryptocurrencies. “I can say almost with certainty that cryptocurrencies will come to a bad end,” Buffett told CNBC in an interview….


7-Eleven in talks with a ‘few parties’ on food deal

KUALA LUMPUR: 7-Eleven Malaysia Holdings Bhd is in talks with a few parties on food chain supply after its memorandum of undestanding (MoU) with Brahim’s Holdings Bhd’s subsidiary lapsed after close to two years.

Last week, 7-Eleven said in a stock exchange filing that the MoU with Brahim’s “has lapsed and accordingly ceased to have any effect”.

“We’re looking to work with many others. We’re talking to some (a few parties), but it’s not finalised yet,” 7-Eleven Malaysia majority shareholder and Berjaya Corp founder and executive chairman Tan Sri Vincent Tan told a press conference after launching mobile wallet app One2pay today.

He added that once the company has finalised the decision, it will make an announcement, estimated in the next two to three months.

Meanwhile, Tan said the group is projecting a 3%-5% increase in sales for the retail businesses under Berjaya Group, on the back of the appreciation of the ringgit and positive signs such as the growing economy and foreign investments in the country.

He said while retail associations and retailers have lamented the soft retail market, partly due to competition from e-commerce, the situation has been better because the ringgit has strengthened, which augurs well for the retail industry.

“The retail trade in Malaysia is still okay and is not as bad as painted by some. For our group, we’re optimistic that the retail trade will get better,” said Tan.

He added that the group witnessed a dip in sales when the Goods and Services Tax (GST) was implemented but now it has stabilised and sales are going up.

“People have accepted GST. Consumers are back and the sales are up.”


7-Eleven in talks with parties on food deal

KUALA LUMPUR: 7-Eleven Malaysia Holdings Bhd is in talks with a few parties on food chain supply after its memorandum of undestanding (MoU) with Brahim’s Holdings Bhd’s subsidiary lapsed after close to two years.

Last week, 7-Eleven said in a stock exchange filing that the MoU with Brahim’s “has lapsed and accordingly ceased to have any effect”.

“We’re looking to work with many others. We’re talking to some (a few parties), but it’s not finalised yet,” 7-Eleven Malaysia majority shareholder and Berjaya Corp founder and executive chairman Tan Sri Vincent Tan told a press conference after launching mobile wallet app One2pay today.

He added that once the company has finalised the decision, it will make an announcement, estimated in the next two to three months.

Meanwhile, Tan said the group is projecting a 3%-5% increase in sales for the retail businesses under Berjaya Group, on the back of the appreciation of the ringgit and positive signs such as the growing economy and foreign investments in the country.

He said while retail associations and retailers have lamented the soft retail market, partly due to competition from e-commerce, the situation has been better because the ringgit has strengthened, which augurs well for the retail industry.

“The retail trade in Malaysia is still okay and is not as bad as painted by some. For our group, we’re optimistic that the retail trade will get better,” said Tan.

He added that the group witnessed a dip in sales when the Goods and Services Tax (GST) was implemented but now it has stabilised and sales are going up.

“People have accepted GST. Consumers are back and the sales are up.”


AirAsia explores India unit IPO, seeks partner for services business

SINGAPORE: Malaysia-based AirAsia Bhd is considering an initial public offering for its Indian unit and seeking a partner for its services business, the carrier’s group chief executive Tan Sri Tony Fernandes said today.

This is the latest in a series of asset monetisations being undertaken by the low-cost airline group, which this week received shareholders’ nod for a reorganisation to make AirAsia Group Bhd the listed holding company for assets across Asia.

AirAsia has already completed a backdoor listing of Indonesia AirAsia TBK PT and finalised a S$119.3 million (RM358.1 million) joint venture for its ground-handling business with Singapore’s SATS Ltd. Its Philippine unit is looking to raise up to US$250 million via an IPO in mid-2018.

AirAsia will seek approval at the next AirAsia India board meeting to pick a banker to start a preliminary process for an IPO, Fernandes posted on Twitter today.

While analysts are “giving zero value to AirAsia India”, the unit is a “very valuable asset with huge growth potential”, he said in separate tweets, adding the subsidiary “was not far from 20 planes and a potential IPO”.

According to Indian regulations, airlines need to have a fleet of at least 20 aircraft to fly on international routes.

AirAsia India, a joint venture with India’s Tata Sons conglomerate, had 14 planes at end-2017. Its revenue last year was expected to double to 12 billion rupees (RM754.9 million) and climb to 18 billion rupees in 2018.

The fast-growing Indian venture reported a net loss of 164 million rupees in the quarter ended September, according to AirAsia’s latest accounts.

“AirAsia India is still incurring start-up losses and in negative equity so it is challenging to ascribe much value to the business at this point,” said Corrine Png, the CEO of transport research firm Crucial Perspective.

However, she said if the Indian venture grew its fleet to 20 and turned profitable, AirAsia’s 49% stake could be worth US$200 million based on listed Indian airline rivals. – Reuters


Global sukuk issuance to hover between US$70 Billion – US$80 billion in 2018

S&P anticipates total global sukuk issuance volume to hover between US$70 billion (RM280 billion) and US$80 billion (RM320 billion) this year. KUALA LUMPUR: Global sukuk issuance unlikely to retain strong performance this year due to tighter global liquidity conditions, mounting geopolitical risks and slow progress on the standardisation of Islamic finance products. These setbacks, according to Standard and Poor Global Ratings (S&P), would continue to hold the market back from its full potential. The rating agency, in a report titled Global Sukuk Market Outlook for 2018, anticipate total sukuk issuanceRead More


Ewein MD remanded by MACC

PETALING JAYA: Ewein Bhd confirmed today that its managing director Datuk Ewe Swee Kheng has been remanded by the Malaysian Anti-Corruption Commission (MACC) to facilitate and assist in an investigation.

Ewein noted that based on newspaper reports, the investigation is being conducted under the MACC Act 2009 for matters relating to the Penang Undersea Tunnel project.

“The board of directors would like to clarify that neither Ewein nor its subsidiaries are involved in the Penang undersea tunnel project.

“We do not expect this to have any operational, management or financial impact on the company as the deputy managing director Chuah Poh Lim will continue to run Ewein group’s business as usual,” Ewein said in a stock exchange filing today.

The company added that it will make announcements on any further material development in the MACC investigation.

Last August, Ewein’s subsidiary Ewein Zenith II Sdn Bhd scrapped its plan to buy a piece of freehold land that the Penang government had given to Consortium Zenith Construction Sdn Bhd (CZ) as payment for CZ’s work on the Penang undersea tunnel project and three related roads.

Ewein’s share price closed down 2 sen or 4.25% to 45 sen today with 2.72 million shares done.

Meanwhile, shares of Vertice Bhd, formerly known as Voir Holdings Bhd, slumped as much as 13.8% today following news of the MACC probe into the Penang undersea tunnel project.

At market close, Vertice’s share price was down by 9 sen or 8.3% to RM1 with some 4.98 million shares done.

Vertice was quick to make a filing with the stock exchange assuring investors that its 13.2%-owned associate Consortium Zenith Construction Sdn Bhd will remain the main contractor for the project as previously planned.

The company added that the MACC investigation will not impact the progress of the project, which is an integral component of the Penang Transport Master Plan.

Vertice highlighted that it is not expecting recent developments to affect its financial performance, saying that the main revenue growth driver will be its wholly-owned subsidiary Vertice Construction Sdn Bhd, which has bagged multiple projects worth more than RM100 million in recent months.

“We expect that this growth momentum will continue in the financial year 2018 and beyond,” it said.

On Tuesday, the anti-graft body conducted a large scale raid on Consortium Zenith and several companies working on the project as well as the Penang state government agencies including the State Secretariat Office, Public Works Department as well as Land and Minerals Department.

Two company directors have been detained and remanded in Putrajaya and Penang magistrate’s courts in connection with the case.

The RM6.3 billion undersea tunnel project linking the island and the mainland was initiated two years ago and a final decision has yet to be made.


Sumatec expects increased output from Kazakh oilfield

PETALING JAYA: Sumatec Resources Bhd said CaspiOilGas LLP’s (COG) oil production in Kazakhstan’s Rakushechnoye oilfield could reach 1,500 barrels per day (bbl/d) by the end of March 2018 after having reactivated its oil production enhancement programme.

The group told Bursa Malaysia that it was informed by COG’s director-general Saubay Izbassarov in a written field report, informing them of the reactivation in the second half of 2017. In addition to that, another 1,000 bbl/d is expected following the completion of workover for 12 wells, slated for completion by the end of August 2018.

In line with that, total oil production is expected to further increase to about 7,500 bbl/d with the drilling of two new deep Triassic wells by the end of 2018.

COG is a unit of Markmore Energy (Labuan) Ltd and is the concession owner of the Rakushechnoye oil and gas field in West Kazakhstan. Last October Sumatec had entered into a heads of agreement relating to the acquisition of 100% equity interest in Markmore for RM1.55 billion.

“Under the joint investment agreement (JIA) between Sumatec and COG and the field development plan, Sumatec also has claim on associated gas by way of sharing condensates,” Sumatec noted.


ECER attracts RM111b in private investments over 10-year period

PETALING JAYA: The East Coast Economic Region (ECER), which was established 10 years ago, has attracted RM111.6 billion in private investments as at end-2017, surpassing its investment target of RM110 billion by 2020, according to ECER Development Council (ECERDC).

This in return has contributed significantly to ECER’s overall gross domestic product (GDP), which has increased RM9.7 billion equivalent to 1.8% from the 3.9% GDP growth between 2007 and 2016, the government’s statutory body said in a statement today.

Of the total private investments, it said domestic direct investment (DDI) has emerged as a key contributor to economic growth and an important source of job creation for the rakyat.

To date, ECER’s transformation has brought positive impact to more than 950,000 rakyat or 11% of the region’s total population, directly and indirectly.

This includes thousands of people across the urban and rural areas who are enjoying a better quality of life through more than 154,500 jobs and 27,000 entrepreneurial opportunities created by private investors and human capital development programmes in ECER.

Local investments, mainly driven by the local micro, small and medium enterprises (SMEs), contributed 46% of the total investment committed in ECER, reinforcing the pivotal role they play as the backbone of socio-economic growth in the region.

Bumiputra investments under the [email protected] programme has also made a significant contribution, contributing 14% to the total private investment in ECER.

These investments have seen a total of 177 projects worth RM16.2 billion in ECER benefitting from ECERDC’s tax incentives or [email protected]’s facilitation funds, or both. From these investments, more than 19,100 job opportunities will be generated for the rakyat, it noted.

ECERDC was established to spearhead the execution and implementation of the ECER Master Plan.

The ECER Master Plan, approved by the government in 2008, was formulated as a basis to guide the development of ECER until 2020. It identifies projects and programmes to reduce regional socio-economic disparities, eradicate poverty and improve income and wealth distribution in a sustainable manner.