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Hasbro to buy ‘Peppa Pig’ owner for US$4 billion

WASHINGTON, Aug 23 — US toymaker Hasbro announced yesterday that it is acquiring studio Entertainment One, which owns popular cartoon series Peppa Pig among other children’s content, for approximately US$4 billion (RM16.8 billion). Under the…


Astro stocks ease following data breach

KUALA LUMPUR, Aug 23 ― Share prices of satellite television provider, Astro Malaysia Holdings Berhad fell in early trading after it suffered another data breach, the second known leak in the span of 18 months. As of 11.03am, the company’s shares…


European shares tumble in choppy session, FTSE lags

FRANKFURT, Aug 23 ― European shares fell yesterday as mixed readings of business growth across major economies and uncertainty over the US interest rate outlook made investors nervous, while a jump in the pound dented London stocks. The latest…


Proton expected to zoom past Honda in year-to-date market share

PETALING JAYA: Proton is expected to overtake Honda in the year-to-date (YTD) market share, helped by volume-oriented models like the Persona and Iriz, according to AmInvestment Bank.

It said that based on a media report recently, Proton registered a total sales volume of 8,600 units in July, translating into a market share of 16.5% for the month and 15% on a YTD basis.

The total sales for Proton for the first seven months of 2019 (7M19) stood at 52,200 units, recording a growth of 48% year-on-year.

“While we have yet to receive the official MAA (Malaysian Automotive Association) numbers for the other brands and the total TIV (total industry volume) breakdown, it is highly likely that Proton has ousted Honda and claimed its position as the runner-up in YTD market share.

With the sustained momentum and deliveries from volume-oriented models like the Persona and Iriz, we strongly believe that Proton will finish second by the end of 2019, behind the national titan Perodua,“ it said in a report today.

Perodua, meanwhile, posted a total sales volume of 19,100 units in July. It is maintaining its sales target of 235,000 units for 2019.

“We strongly believe that the national marques’ sales volume will continue to be the key driver of the local automotive space.

“With the recent launch of the Saga (latest version), we believe that Proton will be able to maintain its sales volume momentum through the remaining months of the year. We also look forward to the upcoming X70 CKD in November, where DRB-Hicom’s management has guided that there will be a price reduction for the popular SUV,” said AmInvestment Bank.

July 2019 TIV rose 20% mom but dipped 26% yoy to 50,900 units. The year-on-year decrease in July this year was due to a high base from 2018’s tax holidays. Cumulatively, 7M19 TIV was down 3% to 347,200 units from 358,100 units in 7M18.

“YTD TIV was within our forecast of 603,000 units for 2019, accounting for 58% of our full-year estimates,” it added.

AmInvestment Bank has ‘buy’ calls on Bermaz Auto Bhd, DRB-Hicom Bhd, MBM Resources Bhd, Pecca Group Bhd, Sime Darby Bhd and Tan Chong Motor Holdings Bhd while it is underweight on APM Automotive Holdings Bhd.

“We are now upgrading the automobile sector to overweight based on our recent upgrade on Sime Darby to buy. We believe that the stock’s valuation is undemanding at current levels and we are now recommending a buy on weakness of the share price. We now have six buys out of the eight stocks under our automobile sector coverage,” AmInvestment Bank said.


Elanco to become No.2 in animal health with US$7.6b Bayer deal

AUGUST 20 — Elanco Animal Health agreed to buy Bayer’s veterinary drugs unit today in a cash and stock deal valued at US$7.6 billion, creating the second largest animal health business and expanding Elanco’s reach online. The deal is the…


Stimulus hints drive European stocks higher

BERLIN, Aug 19 — European stock markets rose for the second session running today, with Frankfurt shares leading a recovery from last week’s six-month lows as investors cheered signs of moves by Germany and China to counter slowing growth….


Euro gains after biggest weekly drop in six weeks as risk appetite returns

LONDON, Aug 19 — The euro steadied today after suffering its biggest weekly drop in nearly two months as risk appetite gradually returned to global markets after a week of turmoil. With hopes of fiscal stimulus from Germany growing and steps by…


Gain your share of wealth on the stock market

BURSA MALAYSIA: HOW WEALTH-BUILDERS INVEST

EVERYONE has a financial goal. Aside from savings and/or fixed deposits, insurance-linked investments or unit trusts and property, one of the best options is still the stock market – for better returns in a shorter timeframe. Is it risky, hard to learn, and too expensive? Not really, if you understand the fundamentals of what you’re doing.

What kind of investor should you be?

Generally, there are two extremes – on one end, there are investors who depend on technical readings and technology to trade frequently, and then there are those who buy and hold shares for the long term. Both methods can be profitable, and many investors are a mix of both.

You don’t need a lot of money to begin.

Low Chern Hong, head of operations and certified trainer of 8VIC Malaysia Sdn Bhd, adds, “You can start with only RM100. The secret formula is Time + Savings + ROI (return on investment). Before you invest, do your research; go online and read books and articles on finance; understand it thoroughly.”

You need to open a CDS account, and any registered broker can help you. At first, it is natural to want to spend every minute watching the market – like an active trader who buys and sells with every movement. Although they can generate high returns quickly, always remember this truism – the higher the potential returns, the higher the risk.

What if you’re not a full-time investor?

If you don’t have the time, or the appetite for such risk, consider the “Value Investing” strategy – as used by famous investors such as Warren Buffet, Charlie Munger, Walter Schloss and Sir John Templeton. Essentially, they look to invest in three things – a great business model, a company with good management and a good price.

It is slower and less exciting, but their gains can be outstanding. According to Benjamin Graham, a famous value investor, “The real money is made from dividends, and from long-term increases in value.”

So many choices. Which companies should you invest in?

Do your research. Read their annual reports, understand their business models and environment, and look at their track record of dividends and share price history.

You can start with Bursa Malaysia’s top 30 stocks – companies in the banking, oil and gas, property and telecommunications sectors. They are “blue-chip” stocks that pay regular dividends, and can deliver strong gains if you buy them at a good price.

Or you can start with Exchange Traded Funds (ETFs). An ETF is a basket of stocks that represents a sector of the market. If the market goes up, so does the ETF and vice versa. There are various types of ETFs for you to choose from. Real Estate Investment Trusts or REITS are similar – except that they represent the business per-formance of a group of properties.

Once you’re more advanced, you can look at Bursa Malaysia’s Derivatives Market for products that can potentially deliver gains no matter which way the market is moving. Although riskier, they offer better potential gains.

As always, you should balance your investment portfolio. We recommend diversifying – spreading your capital over a variety of investment options and sectors to protect yourself.

Bursa Malaysia can help.

It’s important to always keep learning. Billionaire investor Warren Buffet spends many hours a day reading. He says, “Risk comes from not knowing what you are doing.” Rather than trade on emotion, tips or rumours – do your own objective research, understand the risk involved and stay within your risk profile.

At Bursa Malaysia, we provide access to tools and the knowledge to help you. Beyond your capital, the real investment lies in your efforts to educate yourself, and to develop the patience and tenacity that it takes to be a successful investor.

For further information, visit www.bursamarketplace.com or download the BursaMktPlc app, a one-stop investment portal for market knowledge, insights, trading ideas and to improve your financial literacy. There’s also a full schedule of the investment seminars and workshops – do join us.

Part of a series of articles by Bursa Malaysia to educate, develop and empower everyday investors.


Empire Resorts deal to suppress sentiment on GenM further

PETALING JAYA: Despite Genting Malaysia Bhd’s (GenM) share price having plunged 15% since the acquisition of the controversial Empire Resorts Inc, Kenanga Research believes that the deal will suppress the stock sentiment further, hence downgrading it to “market perform”.

Citing that GenM’s valuation is still not attractive enough, it has revised downward GenM’s target price to RM3.20 from RM4.30.

This comes after GenM responded to a query on Bursa Malaysia, stating that the purchase of Empire shares from Kien Huat Realty III Ltd (KH) and a 51:49 joint venture between KH and GenM to privatise Empire should be able to resolve Empire’s present liquidity challenges.

The research house said although Empire is unlikely to be liquidated, GenM is paying a hefty price for the related party transaction acquisition, which saw its market capitalisation plunge by RM3.2 billion.

“In addition, the proposed acquisition is not merely on equity stake but involves capital injection for debt restructuring.”

Empire has said it may pursue a voluntary chapter 11 bankruptcy proceeding, if measures such as the joint venture privatisation bid are unsuccessful.

Under the deal, Kenanga has estimated that GenM will pay US$128.6 million (RM538.8 million) for 13.2 million Empire shares at US$9.74 per share and eventually, the joint venture will have to pay about US$53.6 million to take the company private.

“In all, this deal is viewed as vital to Empire which needs fresh capital injection to restructure its borrowings given its poor cash flow generating ability being loss-making for the past 20 years.

The research house highlighted Empire’s latest 1H19 results showed a net loss of US$73.7 million against a net loss of US$155.4 million in FY18 along with a total payment commitment of US$112 million over the next 12 months or US$827 million over the next five years.

“Therefore, GenM’s commitment is not capped at only circa RM538.8 million.”

Based on Empire’s latest filing, its biggest outstanding debt is a US$520 million (RM2.17 billion) building term loans for the development of Resorts World Catskills which commenced operations in February 2018.

As of Q2 19, Empire has an outstanding term loan of US$504.7 million or US$688.5 million including interest payment for the next five years.

Assuming GenM has to bear 49% of this term loans, Kenanga said it may need to inject US$247 million for the debt restructuring.

The research house calculated that it will cost RM1.69 billion for GenM to own a 49% stake in Empire, eventually which includes the initial acquisition cost and the privatisation cost.

It said that GenM has no problems financing the acquisition given its cash position of RM5.56 billion as at Q1’19.

“However, the negative earnings impact in the near term could be significant as the 49% stake in US$155.4 million net loss, which accounts to RM320 million, 17% of GenM’s FY18 core earnings,” it said.


CIMB expected to post better earnings despite challenging environment

KUALA LUMPUR, Aug 16 — CIMB Group is expected to post positive earnings in the coming period despite facing with interest rate cuts and challenging external environment.  Multiple research notes suggested that net interest…