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China stocks suffer sharp sell-off on multiple investor worries

HONG KONG, Oct 18 — Chinese stocks fell sharply today as heavy selling in the energy sector and worries about the levels of borrowing in the stock market added to broader concerns over growth and the global sell-off in equities. The Shanghai…


Dividend windfall: Santander latest target in Germany's giant fraud probe

FRANKFURT, Oct 18 — Spain's Santander is the latest bank to be caught up in Germany's biggest post-war fraud investigation involving a share-trading scheme that the authorities say cost taxpayers billions of euros. In June, prosecutors in Cologne…


Chinese electric car makers now look for way out of glut

HANGZHOU, CHINA: Humming away in an industrial estate in the eastern Chinese resort city of Hangzhou, electric vehicle designer Automagic is one of hundreds of companies looking to ride the country’s wave of investment in clean transportation. The company wants to find a niche in a crowded sector that already includes renewable equipment manufacturers, battery makers […]


Exchange 106 – low occupancy ‘worrying’

PETALING JAYA: The committed occupancy of Exchange 106 Tower at TRX has fallen drastically to 10%, which is a concern amidst a subdued office market, said UOB Kay Hian.

“We understand that the Exchange 106 Tower is slated for completion by early 2019 and its first tenant will occupy the space in May 2019. However, we are concerned about its committed occupancy which has fallen drastically to 10% currently, compared to 50% pre-GE 14,” it said in its report today.

“With a persistently subdued office market (evidenced by low occupancy rates for office buildings in Kuala Lumpur), securing tenants will remain a key challenge for the TRX project which also faces competition from newer projects such as the PNB 118 and Bukit Bintang City Centre,” it added.

It noted that other ongoing office tower projects such as the Prudential HQ office is almost completed while two other office towers namely the HSBC Head Office and Affin Bank Head Office are under construction and both expected to be completed by end of 2020.

Meanwhile, the National Housing Policy 2.0, which is expected to be revealed in November or December, will benefit property developers who are focused on building houses below RM500,000.

“The new housing policy presents slight optimism for the sector as it is expected to tackle the high property prices and ease lending requirements – particularly for first-time home buyers,” said UOB Kay Hian.

The Ministry of Housing and Local Government has emphasised that it will address several issues including lowering house prices by reducing compliance cost and implementation of industrialised building systems.

In addition, the federal government is also working closely with state governments on land issues whereby the latter have been asked to submit a list of potential land plots that can be used for affordable housing projects.

“Potential measures that are proposed for the new housing policy include the extension of a maximum loan tenure to up to 40 years and to provide various types of loan structures like flexi loans, flexi interest rates and step-up schemes.

“These hybrid measures provide better flexibility for homeowners to own houses, and allow young homebuyers to own a house once they join the workforce,” said UOB Kay Hian.

At present, the maximum loan tenure is 35 years or until the borrower turns 70 years old, whichever is earlier.

Moving forward, the research house said that affordable housing will remain the key focus of developers. This is reflected by the rise in launches of residential properties priced below RM500,000, which grew from 52% of total launches in 2H17 to 65% in 1H18 as reported by the Real Estate and Housing Developers’ Association Malaysia.

“Separately, the association also outlined a few suggestions to encourage provisions of affordable housing which includes reduction of development charges, lower land conversion premium and exemption of capital contribution,” it said.

The Valuation and Property Services Department recently reported an increase of 18.1% in unsold and completed homes to a new record high of 29,277 units in 1H18, with majority of the overhang units being high-rise residences priced between RM500,000 and RM1 million.

“In view of this, we think that property developers that focus on the affordable housing segment may continue to report decent earnings while developers that focus on the premium market may face risk of slower take-up rates and their margins could be compromised,” said UOB Kay Hian.

It maintained “market weight” on the property sector and maintained “buy” calls on Malaysian Resources Corp Bhd and Gabungan AQRS Bhd. For exposure to the affordable housing theme, it prefers Mah Sing Group Bhd, on which it has a “hold” call and target price of RM1.23.


Exchange 106 – drastic drop in committed occupancy ‘worrying’

PETALING JAYA: The committed occupancy of Exchange 106 Tower at TRX has fallen drastically to 10%, which is a concern amidst a subdued office market, said UOB Kay Hian.

“We understand that the Exchange 106 Tower is slated for completion by early 2019 and its first tenant will occupy the space in May 2019. However, we are concerned about its committed occupancy which has fallen drastically to 10% currently, compared to 50% pre-GE 14,” it said in its report today.

“With a persistently subdued office market (evidenced by low occupancy rates for office buildings in Kuala Lumpur), securing tenants will remain a key challenge for the TRX project which also faces competition from newer projects such as the PNB 118 and Bukit Bintang City Centre,” it added.

It noted that other ongoing office tower projects such as the Prudential HQ office is almost completed while two other office towers namely the HSBC Head Office and Affin Bank Head Office are under construction and both expected to be completed by end of 2020.

Meanwhile, the National Housing Policy 2.0, which is expected to be revealed in November or December, will benefit property developers who are focused on building houses below RM500,000.

“The new housing policy presents slight optimism for the sector as it is expected to tackle the high property prices and ease lending requirements – particularly for first-time home buyers,” said UOB Kay Hian.

The Ministry of Housing and Local Government has emphasised that it will address several issues including lowering house prices by reducing compliance cost and implementation of industrialised building systems.

In addition, the federal government is also working closely with state governments on land issues whereby the latter have been asked to submit a list of potential land plots that can be used for affordable housing projects.

“Potential measures that are proposed for the new housing policy include the extension of a maximum loan tenure to up to 40 years and to provide various types of loan structures like flexi loans, flexi interest rates and step-up schemes.

“These hybrid measures provide better flexibility for homeowners to own houses, and allow young homebuyers to own a house once they join the workforce,” said UOB Kay Hian.

At present, the maximum loan tenure is 35 years or until the borrower turns 70 years old, whichever is earlier.

Moving forward, the research house said that affordable housing will remain the key focus of developers. This is reflected by the rise in launches of residential properties priced below RM500,000, which grew from 52% of total launches in 2H17 to 65% in 1H18 as reported by the Real Estate and Housing Developers’ Association Malaysia.

“Separately, the association also outlined a few suggestions to encourage provisions of affordable housing which includes reduction of development charges, lower land conversion premium and exemption of capital contribution,” it said.

The Valuation and Property Services Department recently reported an increase of 18.1% in unsold and completed homes to a new record high of 29,277 units in 1H18, with majority of the overhang units being high-rise residences priced between RM500,000 and RM1 million.

“In view of this, we think that property developers that focus on the affordable housing segment may continue to report decent earnings while developers that focus on the premium market may face risk of slower take-up rates and their margins could be compromised,” said UOB Kay Hian.

It maintained “market weight” on the property sector and maintained “buy” calls on Malaysian Resources Corp Bhd and Gabungan AQRS Bhd. For exposure to the affordable housing theme, it prefers Mah Sing Group Bhd, on which it has a “hold” call and target price of RM1.23.



Goldman Sachs will slow consumer loan growth if market falters

NEW YORK, Oct 17 — Goldman Sachs will limit loan growth in one of its new business areas if it sees a marked deterioration in credit quality, potentially jeopardising new Chief Executive David Solomon's task of boosting revenue by US$5 billion…


Chinese electric car makers, nurtured by state, now look for way out of glut

HANGZHOU, Oct 17 — Humming away in an industrial estate in the eastern Chinese resort city of Hangzhou, electric vehicle designer Automagic is one of hundreds of companies looking to ride the country's wave of investment in clean transportation….


Malaysia, Japan in talks on Asian aircraft project

KUALA LUMPUR: Malaysia is in discussions with the Japanese government for an Asian aircraft project, which is still at the ideation stage, with Malaysia looking at possibly supplying components.

Entrepreneur Development Minister Datuk Seri Mohd Redzuan Yusof said the idea, envisioned to be like Airbus, for an Asian aircraft came from the Japanese government.

“They (Japanese government) invited us to consider participating in the Asian aircraft project in view that we have the base here in relation to what we do to support the global aircraft industry, namely CTRM (Composites Technology Research Malaysia Sdn Bhd) is supplying tier 2 (aerospace parts) to Airbus. That will become our base to open up more if the ideation from Japan do materialise in the near future,” he told a press conference at the Malaysian Economic Summit 2018 today.

He said it has not prepared the framework of its understanding between the various countries in Asia for the project, given that there is only an ideation coined.

Adding that it has yet to have the first meeting, he hopes the next engagement will be held in late November in Japan.

“I interacted with the Japanese counterpart. They coined the idea of having an Asian aircraft using the entrepreneurship kind of approach to develop this vendor (system), which is already in the industry, expand their capacity and capability, reaching certain level then combining our resources and technology to realise (this project).”

Meanwhile, he said the Ministry of Entrepreneur Development (MED) is reviewing all the policies and initiatives regarding the development of entrepreneurs and SMEs with the intent to make it more holistic, integrated and targeted.

Mohd Redzuan said it is the ministry’s mission to widen and coordinate entrepreneurial activities to be more targeted, inclusive, encompassing all segments of society including the B40s and M40s.

“MED will focus among others on providing proper training and facilitation for entrepreneurs based on industry needs such as business advisory, loans and funding to stimulate the interest of potential and new entrepreneurs to establish their own startups. At the same time, assistance will be extended to them to ensure growth and sustainability of their businesses,” he said.

He said it is the mandate of MED to provide support and facilitation to local entrepreneurs so that they may move forward and withstand the competition and challenges of the global market. – By Ee Ann Nee


Entrepreneur Development Ministry reviewing entrepreneurship initiatives

KUALA LUMPUR: The Ministry of Entrepreneur Development (MED) is reviewing all the policies and initiatives regarding the development of entrepreneurs and SMEs with the intent to make it more holistic, integrated and targeted.

Minister Datuk Seri Mohd Redzuan Yusof said it is the Ministry's mission to widen and coordinate entrepreneurial activities to be more targeted, inclusive, encompassing all segments of society including the B40 and M40 groups.

“MED will focus, among others, on providing proper training and facilitation for entrepreneurs based on industry needs such as business advisory, loans and funding to stimulate the interest of potential and new entrepreneurs to establish their own start-ups. At the same time, assistance will be extended to them to ensure growth and sustainability of their businesses,” he said in his special keynote address at the Malaysian Economic Summit 2018 here today.

He said it is the mandate of MED to provide support and facilitation to local entrepreneurs so that they may move forward and withstand the competition and challenges of the global market.