Sunday, February 10th, 2019
ISLAMABAD, Feb 10 — International Monetary Fund chief Christine Lagarde today met Pakistani Prime Minister Imran Khan and assured him that IMF stands ready to support his country. The meeting took place on the sidelines of the World Government…
DUBAI, Feb 10 — The International Monetary Fund today warned governments to gear up for a possible economic storm as growth undershoots expectations. “The bottom-line — we see an economy that is growing more slowly than we had…
PETALING JAYA: Shopping malls are now allocating a higher percentage of their tenant mix (more space) to food & beverage (F&B) retailers, partly because competition from online platforms has impacted other types of retailers such as fashion, according to a market research and consulting firm.
“Traditionally, F&B made up less than 20% of a mall’s tenant mix, but can go up to 40% nowadays,” Stratos Consulting Group Sdn Bhd managing director Tina Leong told SunBiz.
She said with the tenant mix now consisting of more F&B, this means that malls will need to design or renovate in such a way as to cater to the specific technical requirements that F&B retailers have, for example provisions for water, grease traps, storage, waste disposal and daily delivery.
“F&B as a segment itself has become the anchor for some malls,” said Leong.
She said malls that have a high F&B tenant mix include the refurbished 3 Damansara (formerly Tropicana City Mall), which now has more F&B compared to before. Similarly, Paradigm Mall in Petaling Jaya has refurbished its lower ground floor, which now consists of more F&B than previously.
Sunway Velocity Mall general manager centre management Danny Lee said F&B makes up 27% of the mall’s tenant mix currently, and that it is targeting to have F&B reach 30%.
“Naturally, F&B is doing better compared to others,” Lee said.
Meanwhile, Leong noted that having more or certain types of F&B can also be part of experiential retailing.
“For example, people nowadays, especially millennials, appreciate and are willing to spend on meals or drinks with friends and family, within nicer ambience restaurants or cafes, due to the memorable experiences this create.”
She said to continue to draw shoppers (rather than them shopping online), more shopping malls are looking at creating engaging “experiences” for their customers. Experiential shopping simply means making the physical act of spending money more than simply handing over cash in exchange for goods and services.
“More grocery stores are incorporating food and wine bars where people can enjoy a meal or a drink as well as a social experience before or instead of shopping,” said Leong, adding that some retailers have also integrated augmented reality into their stores, for example Starbucks Reserve Roastery in Shanghai and US-based fashion brand Reformation.
Examples of experiential shopping are malls that have attractively themed or landscaped spots on every floor, where one can stop to take photographs with their friends or family, such as Aeon Mall Kuching. Some community malls in Bangkok, Thailand, have incorporated spaces for pet parks, children’s sand pits and jogging tracks.
“Another recently opened mall, Kiara 163 in Mont Kiara, has incorporated the ‘experiential’ element into their mall design, with a central garden and water features for people to relax. Apart from design features, other ways of creating memorable shopper experiences are through interesting or unique events, activities, decorations, pop-up stores, technological innovations and customer service,” explained Leong.
She said some of the major major malls have been doing this all along, such as Suria KLCC and Pavilion Kuala Lumpur that usually have attractive and unique festive decorations.
“What is different is that nowadays, the customer experience aspect is becoming a focal point. It has become more important as malls and retailers try to attract and retain shoppers in the midst of competing options such as online shopping,” said Leong.
KUALA LUMPUR: Foreign investors were net buyers in the Malaysian equity market, pumping in RM138.6 million last Monday and Thursday, compared with RM146.8 million recorded during the previous week.
Bank Islam Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the inflow of foreign funds was quite impressive despite external uncertainties.
“Perhaps, expectation that the US Federal Fund Rate will reach a peak of 2.5% may have driven funds from abroad to look at emerging market assets.
“Global prospects were also quite weak based on the recent Global Purchasing Managers’ Index (PMI) for the manufacturing sector which fell to 50.7 points in January from 51.5 points in December 2018,” he told Bernama.
However, Mohd Afzanizam said US labour markets remained strong, following the release of better-than-expected non-farm payroll data for January coupled with higher wages which could prompt the US Federal Reserve to resume monetary tightening measures should inflation continues to rise.
“If that happens, it may have an impact on capital flow and currency markets,” he added.
Meanwhile, MIDF Research analyst Adam M Rahim said the month of January 2019 saw foreign net inflow of RM1.03 billion, the first monthly net inflow since September 2018.
He said weekly increase in average daily traded value, which jumped 21% to remain above RM1 billion for the second week running, was only evident among foreign investors.
For the just-ended holiday-shortened week, there were no major corporate announcements as the local market was closed for two days to usher in the Chinese Lunar New Year which fell on Feb 5.
On Friday, the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) ended 2.99 points higher at 1,686.52.
Phillip Capital Management Malaysia senior vice-president (investment) Datuk Dr Nazri Khan Adam Khan opined that the small improvement in the fund flow indicated that Malaysia was catching up with other countries such as Indonesia, the Philippines and Thailand.
He said sentiment remained cautious, amid lingering concern following headwinds from trade tensions and global growth.
“The government should encourage more foreign investors to invest in the country as this will propel the inflow of foreign funds into our country,” he said.
On Feb 8, Finance Minister Lim Guan Eng said international investors were confident in Malaysia’s economic potential as well as the government’s ability to drive the economy forward.
He said Malaysia remained an attractive investment destination with investors, especially with the government’s commit-ment to the competency, accountability and transparency principles under Prime Minister Tun Dr Mahathir Mohamad’s leadership.
Lim led a delegation from his ministry on a three-day roadshow from Feb 6-8 to meet Japanese investors and senior government officials in conjunction with the upcoming issuance of the Samurai bond.
As for the ringgit’s outlook, Nazri Khan said the local note was expected to trade at 4.00 against the US dollar next week boosted by mild buying.
“We stay slightly bullish on the ringgit in anticipation of further losses in the US dollar next week,” he said.
On Friday, the ringgit ended at a seven-month high of 4.0670/0720 against the US dollar, a level last seen on July 20, 2018, when it stood at 4.0600/0630.
PETALING JAYA: Malakoff Corp Bhd’s acquisition of Alam Flora is expected to improve its earnings by 4% in financial year ending Dec 31 (FY19) based on an earnings contribution of five months, according to AmInvestment Bank.
On a full-year basis, Alam Flora would increase Malakoff’s FY20 net profit by 10% and boost Malakoff’s fair value from 85 sen per share to about 94 sen a share, AmInvestment analyst Gan Huey Ling said in a note last Friday.
According to Gan, the research house will upgrade Malakoff’s FY19 earnings forecast if the RM944.6 million acquisition of 97.4% of Alam Flora from DRB-Hicom Bhd is completed by the third quarter of 2019 (Q3FY19).
Recently, Malakoff announced that the cut-off date for the fulfilment of the conditions for the acquisition has been extended to July 31.
“We have assumed Malakoff’s gross dividend per share to be 3.5 sen for FY18 and 4 sen for FY19. These translate into decent dividend yields of 4.2% for FY18 and 4.8% for FY19. Implied net dividend payouts are 93% for FY18 and 100% for FY19,” she added.
The research house maintained its “hold” recommendation on Malakoff with an unchanged discounted cash flow-based fair value of 85 sen per share. Its fair value of 85 sen per share implies an FY19 price earnings (PE) of 21.2 times and FY20 PE of 20.7 times.
Going forward, Malakoff has scheduled 100 days of maintenance shutdowns for the Tanjung Bin Energy (TBE) power plant in FY19.
As these are scheduled outages, Gan said the group will still receive capacity payments from Tenaga Nasional Bhd in FY19.
“We gather that there has not been any unplanned outage at the power plants in 4QFY18,” she said.
However, she said TBE power plant’s earnings may still be slightly affected as the rectification works for the voltage regulator, which started in early September, was only completed at the end of October 2018.
Recall that there were unplanned outages at the TBE power plant, GB3 power plant and KEV (Kapar Energy Ventures) power plant in Q3FY18.
Gan also noted that Malakoff is negotiating with General Electric, which is the main contractor, on the compensation for the unplanned outages at the TBE power plant.
She said the compensation would not be able to make up for the loss in capacity payments. However, Malakoff is hoping to extend the warranty period for the equipment and parts and/or receive compensation to cover the cost of repair or rectification works.
Previously, Malakoff’s target was to achieve the stipulated power purchase agreement threshold unplanned outage level of 6% by February 2019.
However, due to the numerous unplanned outages in Q3FY18, the timeline has been shifted to September 2019.
PARIS, Feb 10 — The world’s top energy companies booked enormous profits last year thanks to higher oil prices and keeping a tight lid on spending, even if that risked limiting their medium-term production capacity. The five “supermajors”…
PARIS, Feb 10 — Lawyers for French carmaker Renault have criticised their Japanese alliance partner Nissan for its handling of an internal probe into the Carlos Ghosn scandal, a Sunday newspaper has reported. In a letter to Nissan dated January…
KUALA LUMPUR, Feb 10 — Foreign investors were net buyers in the Malaysian equity market, pumping in RM138.6 million between Monday and Thursday, compared with RM146.8 million recorded during the previous week. Bank Islam Malaysia Bhd chief…