ubs

 
 

Full-blown US-China trade war will slow Malaysia’s export

KUALA LUMPUR, June 25 — A full-blown trade war between the United States and China will impact Malaysia’s economy, slowing down the growth of its export sector by one to two per cent, Affin Hwang Capital chief economist Alan Tan Chew Leong said….


Three Chinese banks face US action in N.Korean sanctions probe, Washington Post reports

WASHINGTON, June 25 — A US judge has found three large Chinese banks in contempt for refusing to comply with subpoenas in a probe into North Korean sanctions violations, The Washington Post reported, adding one of them could lose access to the US…


ACE Market-bound Tashin to raise RM34.4m for business expansion

PETALING JAYA: Prestar Resources Bhd’s 51%-owned Tashin Holdings Bhd is looking to raise RM34.41 million from its proposed listing on the ACE Market of Bursa Malaysia Securities Bhd.

Tashin said in a statement that it plans to use RM17.55 million (51%) raised to purchase a piece of industrial land in Seberang Perai, Penang for the construction of a new factory with a total floor space of approximately 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; RM5.96 million (17.32%) as general working capital while the remaining RM3.20 million (9.3%) to be used to defray listing expenses for the initial public offering (IPO).

The company’s steel products are widely utilised and applied in various industries such as automotive, manufacturing, engineering and steel fabrication as well as construction. Its current factory has an operating capacity of about 224,280 metric tonnes per annum.

Tashin managing director Lim Choon Teik said the new factory is intended to house the company existing manufacturing line for flat and square bars and its new manufacturing line for wire mesh.

“We believe the addition of wire mesh in our manufactured product offerings will allow us to further improve our profitability and strengthen our customer base, which in turn will enhance our competitive position,” he added.

Under the listing exercise, Tashin is issuing 59.33 million new shares at 58 sen per share, of which 17.45 million shares will be made available to the Malaysian public via balloting; 8.72 million shares for its eligible directors and employees as well as eligible directors and employees of the Prestar Group; 17.45 million shares for the entitled shareholders of Prestar while the remaining 15.71 million shares for private placement to selected Bumiputera investors approved by the Ministry of International Trade and Industry (MITI).

Tashin’s existing shareholders will also make an offer for sale of 55.49 million shares to selected investors and selected Bumiputera investors approved by MITI by way of private placement.

Based on the enlarged share capital of 348.99 million shares, Tashin is expected to have a market capitalisation of RM202.41 million upon its listing scheduled on August 1.

The IPO is open for subscription till July 19.

M&A Securities Sdn Bhd is the adviser, sponsor, managing underwriter, joint underwriter and placement agent for the IPO while Malacca Securities Sdn Bhd and JF Apex Securities Bhd are joint underwriters for the IPO exercise.


Huawei’s US research arm builds separate identity

SAN FRANCISCO, June 25 — The US-based research arm of China’s Huawei Technologies Co Ltd — Futurewei Technologies Inc — has moved to separate its operations from its corporate parent since the U.S government in May put Huawei on a trade…


Union Gas monitoring LPG supply after deadly fire at supplier’s facility in Singapore

SINGAPORE, June 25 — Gas supplier Union Gas Holdings is “assessing and monitoring” the impact of disruption to its supply of bottled Liquefied Petroleum Gas (LPG), following a massive fire last Friday (June 21) at a supplier’s facility. The…


Litrak share price jumps on govt offer for highways

PETALING JAYA: Lingkaran Trans Kota Holdings Bhd’s (Litrak) share price jumped as much as 79 sen or 18.8% to a nine-month high of RM5.00 today on news that the government is offering RM2.75 billion to acquire its highways Lebuhraya Damansara Puchong (LDP) and Sprint, which is operated by subsidiary Sistem Penyuraian Trafik KL Barat Sdn Bhd.

The stock closed 70 sen or 16.63% higher at RM4.91, being the second top gainer on Bursa Malaysia with 3.71 million shares done.

Maybank IB Research said the Ministry of Finance’s (MoF) offer price translates into an effective equity value of RM2.75 billion (RM5.207 a share) for Litrak’s two highways, 8% above its equity discounted cash flow (DCF) value of RM2.55 billion.

“In an environment of tapering traffic growth and unlikely scenario of an extension of the concessions for both LDP and Sprint, we believe further upside for Litrak is capped. Our DCF-based target price is raised to RM5.21 (from RM3.90) to reflect the takeover value. With a potential upside of 24%, we tactically upgrade Litrak to a buy,“ MaybankIB said in a report today.

Also, it believes the LDP and Sprint concessions are unlikely to be extended beyond August 2030 (for LDP) and December 2034 (for Sprint).

Meanwhile, MIDF Research said from a shareholder’s perspective, it believes that the offer is appealing. The combined price tag of RM2.75 billion for both highway concessions translates into a price-to-book value (P/BV) of 2.96 times, a 24% premium to the 12-month trailing P/BV of 2.39 times.

On the outlook for Litrak, MIDF said the average weekday tollable traffic volume plying through LDP and Sprint has been on the downtrend since FY15 following the toll hike in October 2015.

“We expect growth in traffic volume to remain muted as the ridership of public transportation such especially LRT (Star and Putra), KTM Commuters and KVMRT Line 1 has been on an upward trajectory. Moreover, the introduction of the unlimited monthly pass called My100 and My50 will further encourage the use of public transportation in the near term,“ MIDF said in a report today.

In the longer term, the completion of KVMRT Line 2 in 2022 which connects Sungai Buloh, Serdang and Putrajaya combined with the possible reinstatement of KVMRT Line 3 will exacerbate the downside risk on tollable traffic volume.

“Specifically for Sprint, the Damansara Link runs parallel to the stretch of KVMRT Line 1 from Semantan Station to Taman Tun Dr Ismail station and we opine that the impact towards traffic volume will be more pronounced with the continuous improvement in public amenities and con-nectivity.”

Of the four stations competing directly with Damansara Link, Phileo Damansara and Pusat Damansara Station are equipped with park and ride facilities with over 500 car parking bays.

MIDF upgraded Litrak to “trading buy” with a revised target price of RM5.21 a share.

“Due to the attractive upside from the current price and our valuation, we advise investors to accept the offer as an exit strategy amid the lack of catalyst LDP and Sprint. As such, we upgrade our call on Litrak from neutral to trading buy with a target price of RM5.21 per share, reflecting the offer price by MOF Inc, on the basis that the deal will go through.”


Fajarbaru awarded RM297m high-rise residential project

PETALING JAYA: Fajarbaru Builder Group Bhd has secured a RM297.54 million job for the main building works (Phase 1) of Duta Park Residences in Kuala Lumpur.

The proposed high-rise residential development is by Malton Bhd’s wholly owned subsidiary Malton Development Sdn Bhd.

The contract is to develop two tower blocks of high rise residential development, made up of 49 levels and 30 levels each, encompassing 572 and 268 units respectively. The construction work for Phase 1 of the development is expected to be completed within 36 months from its commencement.

Fajarbaru has additionally accepted to lock in a sum of RM108 million for the construction of phase 2, a tower block of 46 levels comprising 536 units. The award is subject to confirmation by Malton Development and the locked in price shall remain valid for a period of 12 months from the commencement of Phase 1.

The contract is expected to contribute positively to the earnings and net assets of the group from the financial year ending June 30, 2020 onwards.


Serba Dinamik seeks opportunities in Malacca

KUALA LUMPUR: Serba Dinamik Holdings Bhd has sealed a collaboration with Perbadanan Kemajuan Negeri Melaka to explore opportunities in Malacca related to oil and gas, engineering and civil works as well as construction and development projects.

The collaborative effort is between Serba Dinamik Sdn Bhd, a wholly-owned subsidiary of Serba Dinamik Bhd and a unit of Perbadanan Kemajuan Negeri Melaka, PKNM Energy Sdn Bhd (PKMNE).

Serba Dinamik group managing director and group chief executive officer Datuk Dr Ir Mohd Karim Abdullah said the collaboration would expand the company’s footprint in Malacca, in addition, to its projects in Johor, Sabah, Sarawak and Terengganu.

“We have two rounds of discussion and we have identified quite a number of projects. (Now) We need to sit down and digest all the information in the first round of discussion and fine-tune technical and commercial aspects as well as in line with their policies as the state government.

“Hopefully, we can roll out something in six months from now, which we are quite optimistic that it can happen because Malacca is a vibrant state,“ he told reporters after the signing a memorandum of understanding with PKNME here today.

Meanwhile, Serba Dinamik has secured six operations and maintenance (O&M) as well as one engineering, procurement, construction and commissioning contracts in Malaysia and Qatar through Serba Dinamik International Ltd and Serba Dinamik Sdn Bhd.

The O&M contracts secured in Qatar has an estimated value of US$60 million (about RM250.62 million), while the contracts bagged in Malaysia has no specific value as they were secured on a “call-out” basis, where work orders will be awarded at the discretion of the clients.

Mohd Karim said the group maintained a target of RM10 billion in terms of the order book in the financial year ending Dec 31, 2019.

To date, Serba Dinamik Holdings’ order book stood at RM8.7 billion.



Handal Resources wins RM360m job from Petronas Carigali

PETALING JAYA: Handal Resources Bhd’s unincorporated joint venture, Borneo Seaoffshore – Handal JV has been awarded a RM360 million contract from Petronas Carigali Sdn Bhd.

Handal told Bursa Malaysia that the contract is for the provision of water injection module supply on mobile offshore unit for mobile water injection facilities – Package 4.

The duration of the contract is seven years, commencing from March 2020, with an extension option of a further three years.

Handal said the JV was established to collaborate and submit the technical and commercial proposal to bid for and execute the contract.

The contract is expected to contribute positively to Handal’s earnings for the financial period ended June 30, 2019 and subsequently until the expiry of the contract.

With this latest win, Handal’s order book will surge to more than RM950 million.