Ringgit down at the close

KUALA LUMPUR, April 25 — The ringgit fell against the US dollar at Thursday’s close, nearing the bottom of the weekly range after the country’s Consumer Price Index (CPI) nudged into positive territory, as traders mildly pared back dovish bets…

Leong Hup to raise RM275m from relisting on Bursa Malaysia

PETALING JAYA: Leong Hup International Bhd is targeting to raise RM275 million from its relisting on the Main Market of Bursa Malaysia.

The poultry player was delisted in April 2012.

According to Leong Hup’s prospectus, its initial public offering (IPO) entails an issuance of up to 937.5 million shares comprising an offer for sale of up to 687.5 million existing shares and a public issue of 250 million new shares.

There will be institutional offering of up to 839.5 million shares to Malaysian and foreign institutional and selected investors, including Bumiputera investors; as well as retail offering of 98 million shares to the company directors, eligible employees and the Malaysian public at the retail price of RM1.10 per share.

Through its public issue, the group aims to raise total gross proceeds of RM275 million, of which about 75.5% of proceeds (equivalent to about RM207.7 million) will be utilised for capital expenditure and 12% for working capital.

It has secured 10 cornerstone investors for its IPO, including AIA Bhd, Employee Provident Fund Board (EPF), Maybank Asset Management Sdn Bhd, RHB Asset Management Sdn Bhd, Hong Leong Capital Bhd and agricultural goods processor and merchant Louis Dreyfus Company Asia Pte Ltd.

Other cornerstone investors include Tan Sri Chua Ma Yu and GuoLine (Singapore) Pte Ltd.

Leong Hup is slated for listing on May 16. Established in 1978, it is involved in the production of poultry, egg and livestock feed across the entire poultry value chain in Southeast Asia such as Malaysia, Singapore, Indonesia, Vietnam and the Philippines.

In 2017, it was the largest integrated poultry producer in Malaysia and one of the top three integrated poultry producers in Indonesia and Vietnam, with a total production of 495.6 million day-old-chicks, 1.7 billion eggs and almost 2 million tonnes of feed.

The group’s net profit rose 10.5% to RM219.8 million for the financial period ended October 31, 2018 from RM198.9 million in the same period a year ago.

Its revenue also grew 2.2% to RM4.7 billion from RM4.6 billion.

China’s island cities: Treasure or trouble for Asia?

COLOMBO, April 25 — A high-rise city the size of central London rising out of the ocean next to Sri Lanka’s capital is laying down another marker for China’s global infrastructure ambitions whose epic scope is sounding alarm bells in Asia and…

Ringgit weakens against US dollar in early session

KUALA LUMPUR, April 25 — The ringgit was lower against the US dollar in early trade today on weaker demand for the local note, following the release of favourable economic data in the United States. At 9.07am, the local unit traded at 4.1350/1380…

RHB to be ‘pragmatic’ in facing challenging investment banking scene overseas

KUALA LUMPUR: RHB Bank Bhd sees a challenging investment banking business scenario overseas, which is lacking in scale compared with the business in Malaysia, and it will adopt a “pragmatic” approach to address the challenges.

“That’s why we believe that, based on our FIT22 strategy, we focus on our niche and strength. Take for example in Singapore, we will do equities business, we will do investment banking business but we will not do debt market business because we don’t have the capability for distribution there and particularly in foreign currencies. And of course the bonds mainly in Singapore are not rated. But we will do the others,” said group managing director Datuk Khairussaleh Ramli (pix).

“In Thailand for example, we believe the equities business is very active, the retail broking there is among the most active in Asean, so that’s an area that we will focus on, including maybe some debt market as well,” he told reporters at its AGM today.

He said the investment banking businesses in Indonesia and Thailand have room to expand via organic growth while in Singapore, the group intends to synergise its investment banking and banking businesses in order to offer multiple services to clients.

In terms of its asset management business in Indonesia, Khairussaleh said the business is small and the main challenge there is distribution due to the country’s size.

“We have tied up with some banks but we also want to look at digital ways of distributing our products, because it is such a big country with many islands. If we can’t have physical presence, we need to look at digital capabilities,” he said.

“For our overseas business we take a pragmatic approach of focusing on our niche but in Malaysia, we pretty much are a universal investment bank, we pretty much do everything. Generally in Malaysia, the investment banking business is good,” he added.

RHB expects to take on several initial public offerings (IPOs) this year in the consumer product and trading services segments, including Leong Hup International Bhd and two sizeable IPOs of about RM750 million each in the second half of the year.

The group is one of the joint global coordinators for the IPO of poultry player Leong Hup, which is en route to list on the Main Market of Bursa Malaysia. The prospectus will be launched today.

Meanwhile, RHB aims to grant RM31 billion in new and additional financing for small and medium enterprises (SMEs) by 2021, which will benefit 18,000 SMEs. Last year, it approved RM7.2 billion worth of loans to over 4,000 SMEs in Malaysia.

The bank is currently ranked fourth in the SME segment with a market share of 9.06% as at January. Its market share was about 7% three to four years ago. It aims to connect to 15,000 new SMEs this year through its SME Ecosystem.

RHB aims to grow its mortgage business by 12% this year and 33% or RM17.5 billion over the next three years. Its mortgage market share stood at 9.64% as at February.

Khairussaleh said mortgage applications have reduced but its approval rate has been consistently high at 75%. He said there are no changes to its overall loans growth target of 5% for this year, driven by growth in the mortgage and SME segments.

In terms of provisions, he said it will be decided on a case-by-case basis and while some clients may be going through a difficult patch, there are no systemic issues at the moment.

“We believe that our oil and gas portfolio is under control. But again, potentially there could be case-by-case basis where customers may go through some difficulty. That’s where we should help. In fact, our oil and gas loan loss coverage is more than 100% so we are comfortable with our coverage for the current portfolio,” he said.

RHB’s exposure to the oil and gas sector is 2.8% of its total loan book, with 6% exposure to the property sector.

Ringgit unchanged as investors study inflation data

KUALA LUMPUR, April 24 — The ringgit was unchanged against the US dollar at close today, as traders digest the inflation report released by the Statistics Department, a dealer said. At 6pm, the ringgit stood at 4.1250/1300 versus…

Ringgit unchanged at close

KUALA LUMPUR: The ringgit was unchanged against the US dollar at close today, as traders digest the inflation report released by the Statistics Department, a dealer said.

At 6pm, the ringgit stood at 4.1250/1300 versus the greenback from 4.1250/1300 recorded at Tuesday’s close.

“The report should provide an unambiguous signal for Bank Negara policy and validate the likelihood of an interest rate cut at next months policy meeting,” the dealer said.

Earlier today, the department released its data for March 2019, which saw inflation rate, as measured by the Consumer Price Index (CPI), increase by 0.2% in the month to 121.1 from 120.9 in March 2018.

Meanwhile, the ringgit was traded higher against other major currencies.

It rose against the Singapore dollar to 3.0351/0392 from 3.0400/0446 on Tuesday and appreciated versus the British pound to 5.3365/3446 from 5.3666/3748.

The local currency strengthened vis-a-vis the yen at 3.6870/6921 from 3.6876/6924 and improved against the euro to 4.6254/6326 from 4.6431/6491 previously. — Bernama

Ringgit to trade at 4.10-4.15 to the greenback in Q2

KUALA LUMPUR, April 24 — The ringgit is expected to trade range-bound within the 4.10 and 4.15 band against the US dollar in the second quarter of 2019 (Q2 2019), barring any major catalyst. FXTM market analyst Han Tan said the outlook was on the…

Asian markets fluctuate as dealers brush off Wall St record

HONG KONG: Asian markets fluctuated Wednesday following a record-breaking close on Wall Street that was fuelled by strong earnings from US big-hitters.

The S&P 500 and Nasdaq scaled all-time highs while the Dow came close after a string of better-than-forecast results from the likes of Coca-Cola, Twitter and Lockheed Martin added to a raft of other recent reports that suggest the economy is in rude health.

Markets welcomed “a really great string of earnings reports, most of them outpacing expectations, as well as some pretty good commentary on future estimates from CEOs”, Jim Paulsen, chief investment strategist at Leuthold Weeden, told Bloomberg News.

“There’s quite a bit of positivity carrying this to new highs.”

However, while Asian dealers were generally upbeat they were unable to use the Wall Street performance to kick on in early trade, with major indexes shifting in and out of positive territory through the morning.

Hong Kong and Shanghai were each down 0.2 percent in the morning while Tokyo headed into the break flat and Seoul slipped 0.7 percent.

However, Sydney rose one percent as a drop in Australian inflation raised the chances of an interest rate cut by the country’s central bank. The reading sent the Australian dollar plunging one percent.

Singapore, Taipei and Manila each rose 0.2 percent, Wellington added 0.7 percent while Jakarta inched up slightly.

Oil prices retreat after rally

US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin travel to Beijing next week for another round of high-level talks aimed at resolving their painful tariffs war.

The White House issued a statement saying the latest negotiations “will cover trade issues including intellectual property, forced technology transfer, non-tariff barriers, agriculture, services, purchases and enforcement”, adding that Chinese officials will visit Washington on May 8.

Expectations the talks will eventually end with an agreement between the economic superpowers has helped fire a rally across world markets this year, with the initial row having been the catalyst for a sharp sell-off at the end of 2018.

On oil markets both main contracts were in retreat a day after hitting six-month highs on the back of news that Washington would end a waiver for several countries from US sanctions on Iran.

Prices had already been surging thanks to hopes for the China-US talks and, OPEC and Russia’s output cap, and unrest in Libya and Venezuela.

There is speculation OPEC kingpin Saudi Arabia could step in to fill the void left in the market by the removal of Iranian crude, which would temper prices.

But SPI Asset Management’s Stephen Innes said Riyadh could balk at such a move, having opened the taps when the US unveiled sanctions six months ago only to be “hoodwinked” by the waivers.

“If the US is fully committed to their hawkish Iranian pledge… prices will reprice higher as Saudi Arabia appear tentative about increasing supplies, while it is unlikely (US) shale can fill the void quick enough,” Innes said in a note.

“So to what degree oil markets tighten, and how high oil price goes, will now mostly be dependent on the supply response from OPEC+ group.”

Higher US bond yields weigh on ringgit in early trading

KUALA LUMPUR: The ringgit was lower against the US dollar in early trade today as higher US bond yields hampered demand for the local note.

At 9.06am, the local unit traded at 4.1270/1300 against the greenback from 4.1250/1300 at the close yesterday.

A dealer said investors were in favour of the US dollar following the 20 basis points rise in the 10-year US Treasury yields over the past four weeks.

“Furthermore, the weaker global oil price also affected market sentiment towards the ringgit as this will have an impact towards the country’s oil and gas revenue,” he added.

Brent crude futures and US West Texas Intermediate (WTI) crude futures were both down 0.4% to US$74.24 (RM307) per barrel and US$66.02 (RM273) per barrel respectively.

Meanwhile, the ringgit traded mixed against a basket of major currencies.

It declined against the Singapore dollar to 3.0406/0446 from 3.0400/0446 recorded at yesterday’s close and depreciated against the Japanese yen to 3.6881/6911 from 3.6876/6924.

The ringgit rose against the British pound to 5.3395/3450 from 5.3666/3748 and improved against the euro to 4.6293/6330 from 4.6431/6491. — Bernama