Thursday, August 1st, 2019

 

Tashin ends below IPO price in ACE debut

KUALA LUMPUR: Tashin Holdings Bhd, which made its debut on the ACE Market of Bursa Malaysia today, slid 16.3% to 48.5 sen at the close of its first trading day, against its offer price of 58 sen.

The stock’s opening price and intraday high stood at 58 sen. It was the sixth most active stock on the bourse today with a total of 53.15 million shares traded.

The group said in a statement today that it is setting up a factory and upgrading its existing steel processing line in Seberang Prai, Penang, as part of its plans to expand the steel processing business segment post-listing.

Tashin managing director Lim Choon Teik said the factory will have additional steel processing lines and five new wire mesh production lines with a combined effective production capacity of 50,000 mt per annum.

“We plan to utilise RM25.25 million from the initial public offering (IPO) proceeds to expand our business operations after listing,” he said. The new factory to produce wire mesh is expected to be completed by 2021.

Tashin’s current core activity is steel processing and manufacturing of steel products. Trading of wire mesh and the expansion into the manufacturing of wire mesh will enable it to have control over the supply of wire mesh.

In turn, the manufacturing of wire mesh will enable the company to diversify its manufacturing products and improve its profitability.

“We believe the addition of wire mesh in our manufactured product offerings will allow us to improve our profitability and strengthen our customer base, which in turn will enhance our competitive position. Our plans to make new products will hinge on the market developments,” Lim added.

Under the listing exercise, Tashin raised RM34.41 million from its public issue of 59.33 million new shares at 58 sen per share.

Of the total IPO proceeds, RM17.55 million (51%) will be used to purchase an industrial land in Seberang Perai for the construction of a new factory with a total floor space of 90,000 sq ft.

It will further utilise RM7.7 million (22.38%) to purchase machinery and equipment to support its business expansion into the manufacturing of wire mesh and to upgrade the existing steel processing line.

About RM5.96 million (17.32%) will be used as general working capital while the remaining RM3.2 million (9.3%) to be used to defray listing expenses for the IPO.

Based on the enlarged share capital of 348.99 million shares, Tashin is expected to have a market capitalisation of RM202.41 million.


RAM revises up global sukuk issuance forecast

KUALA LUMPUR: RAM Ratings has revised its global sukuk issuance projection for this year to US$80 billion-US$90 billion (RM331.56 billion-RM373 billion) from US$70 billion-US$90 billion (RM290.12 billion-RM331.56 billion) previously.

It said in a statement today that the upward revision is based on Bank Negara Malaysia’s (BNM) better-than-expected issuance of Islamic securities, the Indonesian government’s commitment and support for the Islamic finance agenda and its role in raising awareness for sustainable and responsible investments (SRI).

As at end of June, global sukuk issuance stood at US$72.7 billion, exceeding the lower range of RAM’s initial projection.

RAM said the new projection was also driven by expectations of the Gulf Cooperation Council’s public sector sukuk issuance providing a sustainable baseline and potentially accounting for a higher proportion of its funding mix.

“Going into the second half of the year, RAM expects Malaysia to retain its pole position as the sukuk market leader in 2019, underpinned by solid support from the government, BNM and the private sector,” said the rating agency.

As at end-June 2019, the gross issuance value of the Malaysian sukuk market had surpassed RAM’s projection of RM100 billion to RM120 billion for the entire year.

Malaysia’s sukuk issuance as at end-June amounted to RM136.9 billion, an increase of 38.3% from RM99 billion recorded in the corresponding period in the previous year.

This was primarily driven by a 61.1% spike in BNM’s issuance of Islamic securities to RM14.5 billion, followed by the corporate sector with RM65.1 billion (+55.5%) and government issues of RM39 billion (+9.9%).


Malaysia as Asean digital hub

GEORGE TOWN: Malaysia has the potential to become a digital hub for Asean as the combined market value in the region is projected to reach up to US$1 trillion (RM4.12 trillion) by 2025.

Malaysia Digital Economy Corporation Sdn Bhd (MDEC) vice-president (investment & industry development) Hew Wee Choong said that there is a huge potential to tap in this area.

Combined with the country’s digitalised ecosystem tailored to boost the start-up presence and to draw in investors, it was only natural for Malaysia to become a hub for the digital economy of Asean.

Currently, Asean has 639 million consumers, about half of China’s population with a gross domestic product (GDP) of US$2.5 trillion and an average growth of 6%.

The region with its 10 countries combined, is the globe’s fifth largest economy with tremendous potential to grow due to a young and energetic population.

Hew said that Malaysia has placed the country in a position to spread the growth of the digital economy throughout the region.

The country already has 20.9 million smartphone users with a household internet penetration rate of 86% while the digital economy is expected to contribute up to 20% of the nation’s entire GDP by next year.

Hew outlined that Malaysia will boost funding for start ups and reaching out to techpreneurs in the region.

“We will also set up an environment which would allow start-ups to collaborate seamlessly with multinational corporations and with fellow service providers,” he said after attending a technology assessment seminar titled “Keysight World”.

The Keysight World seminar was organised by the US-based Keysight Technologies, whose production line in Penang provides the leadership for its global supply chain.

According to him, Malaysia will also bring in the necessary technology applications to help start-ups grow their ventures.

In addition, MDEC will liaise with venture capitalists and new age investors to consider setting up more funds for the Asean digital ecosystem.

Keysight Technologies president Datuk Gooi Soon Chai said that 40% of future capital investments for the Internet of Things (IoT) would be in Asia.

He said that Keysight is already involved in the processes of IoT, Artificial Intelligence, Big Data with one example being the firm’s research in autonomous vehicles, which may come to fruition by the middle of this new millennium.

In light of the progress made in the electronics and electrical market, Gooi said that Keysight has also doubled its research grant from US$300 million to US$600 million to be invested in Penang.

With the bigger investment, Penang is set to play a big part in the age of the Industrial Revolution 4.0 hence it is important for both the public and private sectors to be ready for the digitalisation of the state and the region, said Gooi.


Bank of England lowers UK growth forecasts for 2019, 2020

LONDON, Aug 1 — The Bank of England lowered its near-term economic growth forecasts today amid continued uncertainty over Brexit, while warning that a “no deal” exit from the EU would hit growth and the pound. Members of the central bank’s…


Ringgit closes lower on Fed rate cut

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Hong Kong June retail sales slide, govt says protests dent business

HONG KONG, Aug 1 — Hong Kong retail sales, a key part of the city’s economy, felt a growing impact in June from mass protests, government data showed today. The government said June retail sales fell 6.7 per cent from a year earlier, the biggest…


Bursa expects stronger listing activity in 2H19

KUALA LUMPUR: Bursa Malaysia Bhd expects a stronger listing activity in the second half of the year with 13 initial public offerings (IPO), according to its CEO Datuk Muhamad Umar Swift.

“We have a healthy pipeline of 13 companies to be listed in the second half of the year with an estimated market capitalisation of RM15 billion,” he told the media at Bursa’s first half financial results briefing here today.

“While the market is softer, it makes us confident that we are seeing this stream of businesses coming in, that Malaysia has a deep base for investors.”

Of the 13 companies that have received approval to list by Bursa, three are for its Main Market, seven companies will be listed on the ACE market, while the remaining three will be listed on LEAP market.

In the first half of the year, Bursa saw the listing of 14 companies with a market capitalisation of RM5.5 billion.


BAT sees faster revenue growth on e-cigarette, oral products

LONDON, Aug 1 — British American Tobacco reported better than expected first half sales today, helped by higher demand for e-cigarettes and tobacco heating products, and said revenue growth would accelerate in the second half of the year. The…


Shell blames lower energy prices for profit squeeze

LONDON, Aug 1 — Energy giant Royal Dutch Shell said today its net profit was halved in the second quarter due to lower oil and gas prices as well as lower margins in refining. The net profit for the three months to the end of June came in at US$3…


Financials drive European stocks bounce after Fed hit

LONDON, Aug 1 — European shares recovered from early losses on today as a solid batch of bank earnings outweighed the impact of falling expectations of US interest rate cuts and a slump in Shell shares after its worst results in more than two…