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Thursday, January 30, 2014

延推新楼盘赚幅萎缩 华阳净利预测下修

Source: http://www.nanyang.com/node/596548?tid=462

(吉隆坡29日讯)虽然可负担房屋市场前景明朗,惟鉴于赚幅萎缩加上延迟推出新楼盘,促使券商纷纷下修华阳(HUAYANG,5062,主板产业股)的净利预测。
华阳2014财年首9个月的新销售显著增长,达5亿8010万令吉。全年而言,估计可超越6亿令吉的目标。
净负债率攀新高
华阳接下来将在柔佛推出The Gardens@PoloPark及Citiwoods@Jalan Abdul Samad项目,皆是可负担的高层住宅。至于蒲钟及斯里肯邦安的可负担房屋项目,则预计会在2015财年杪推出。
随着在蒲钟及斯里肯邦安收购新地皮,该公司的净负债也攀至0.7倍的新高。惟管理层表示,近期不会再增购地皮,因该公司尚有充裕的40亿令吉发展总值,足以支撑未来3至4年的增长。
加上手上的Parc@One South即将交付,及Gardenz@One South和Flexis@One South较高的入账,因此管理层相信,净负债率或可降至0.6倍的水平。
肯纳格投行分析员将2014及2015财年的净利预测,分别下调1%及8%,同时维持6亿2000万及7亿7000万令吉的销售预测,惟估计项目的推出日期会比预期要迟。
末季或派息6仙
管理层表示有能力派发更高的股息,促使分析员将每股净股息预测,从8.8仙,上修至11仙。
迄今,华阳已派出5仙股息,意味着末季将派发6仙股息。
肯纳格投行分析员维持“超越大市”的评级,及2.33令吉的目标价格。目前而言,该股2014及2015财年的周息率仍有吸引力,企于6.2%及7.5%。
劳工短缺拖累赚幅
兴业研究分析员认为,华阳近期的净赚幅料出现萎缩,因劳工短缺的问题,始终影响着该领域。
然而,这个风险或会因部分项目的锁定建筑成本而抵消。
尽管消费税(GST)的影响尚不明确,惟管理层相信,成本将通过较高的平均售价,转嫁给买家。
分析员将目标价格下调至2.40令吉,因预计净赚幅将走低。
基于该股的负债率高,分析员更看好恒大置地(TAMBUN,5191,主板产业股)和金群利集团(MATRIX,5236,主板产业股)。

MBSB remains bullish, expects strong performance this year

Source: http://www.thestar.com.my/Business/Business-News/2014/01/30/MBSB-remains-bullish-It-expects-strong-performance-this-year-with-solid-personal-financing/

KUALA LUMPUR: Malaysia Building Society Bhd (MBSB), which achieved a 42% increase in pre-tax profit to RM932.3mil last year, the highest in the company’s history, expects to maintain its bullish performance this year.
Buoyed by its corporate and retail businesses, the group is optimistic of recording an estimated pre-tax profit of RM1bil for the financial year ending Dec 31, 2014 (FY14).
In announcing MBSB’s financial results, president and chief executive officer DatukAhmad Zaini Othman said group revenue rose to RM2.51bil in FY13 against RM1.83bil recorded in FY12.
MBSB declared a dividend of 10 sen per share for FY13, including an interim dividend of five sen per share declared in the fourth quarter.
As for MBSB’s outlook, he said personal financing would continue to be the main contributor to revenue in the retail segment.
MBSB expected loans growth to improve to 12% this year from 10% registered in 2012, he told a press conference yesterday.       
“We hope to sustain the momentum and meet the expectation of regulators, central bank, customers and shareholders,” said Ahmad Zaini.
The group also plans to expand its corporate business segment.       
“We are now intensifying our focus on corporate business financing and have outlined strategies to drive this segment forward,” he said, adding that MBSB planned to grow its corporate loans to 40% in two years from the current 20% by diversifying its product line.
Ahmad Zaini said MBSB would launch a oil palm plantation financing programme by the second quarter and was also targeting the property and oil and gas sectors in an effort to boost its corporate loan growth.
The financial services provider is in talks with clients in Sabah and Sarawak on the oil palm financing programme and expects to ink a deal by April.
As for the group’s net non-performing loans (NPLs), he said it continued to decrease from 4.5% in 2012, to 3.4% in 2013.       
“The declining trend in the group’s NPLs is the result of the company’s persistent efforts in reaching settlement agreements for the remaining legacy corporate accounts and was also a strong indication of prudent asset management,” he added. – Bernama
The group’s revenue rose to RM2.51 billion for the period under review from
RM1.83 billion recorded in 2012 while earnings per share jumped to 37.07 sen from 21.64 sen previously.
MBSB declared a total dividend of 10 sen per share for last year which included an interim dividend of five sen per share declared in the fourth quarter.
BERNAMA

Credit Suisse warns investors on global impact

Source: http://www.thestar.com.my/Business/Business-News/2014/01/30/Credit-Suisse-warns-investors-on-global-impact/

PETALING JAYA: Credit Suisse has told investors to brace for impact following renewed Chinese economic and financial stability concerns, on-going US quantitative easing tapering and Argentina’s peso devaluation.
In a note to investors stating risks to several Asian countries, it said the risk to Malaysia was the country’s high level of foreign bond holdings.
“We still worry about (this) high level,” noted its economists Michael Wan, Robert Prior-Wandesforde and Santitarn Sathirathai in a report yesterday.
However, it also noted that Malaysia, together with the Philippines and Thailand, which were all hit during last year’s mini-crisis, was better placed in most categories.
In the Asia ex-Japan region, compiled data by the research house showed that Malaysia had the highest foreign holdings of government bonds in absolute percentage term at 45.1% presently.
It was also the highest among the emerging countries in data compiled by Credit Suisse.
Meanwhile, on the turn of international economic events recently, Credit Suisse noted that no one yet knew whether it would turn into a “financial storm” similar to what that was witnessed in the May-September period last year, or whether it would be a short-lived squall.
“But, as all good boy scouts know, it’s best to be prepared,” it added further.

Runaway prices of M'sian small-cap stocks point to signs of overheating.

Source: http://www.thestar.com.my/Business/Business-News/2014/01/30/Runaway-prices-of-smallcap-stocks-point-to-signs-of-overheating/

PETALING JAYA: After galloping to historic highs last year, are small-cap stocks at risk of a bubble? Yes and no, said market watchers.
For Hwang Investment Management head of equities Gan Eng Peng, the small-cap sector is looking increasingly frothy.
“It is a case of too much money chasing the same space. Half-baked business models and unproven management are rewarded with a spectacular run in stock prices.
“From experience, we know this kind of event corrects itself in time,” he told StarBizvia email.
There are many reasons why small-cap stocks have seen a “feeding frenzy” leading to outsized gains over the past year, with the FTSE Bursa Malaysia Small Cap Index rising 36% in 2013 versus 12% for the benchmark FTSE Bursa Malaysia KL Composite Index (FBM KLCI).
One of them is “trapped liquidity”, along with the “structural premium” caused by the presence of large domestic investors, Gan pointed out.
“Stocks in Malaysia trade at a 30%-100% premium to similar businesses listed overseas. You can see this in plantation, and oil and gas (O&G) counters.
“Other examples include CIMB Group Holdings Bhd and Axiata Group Bhd, whose Indonesia-listed subsidiaries trade at less than half of their Malaysian parents, despite being their key growth drivers.
“As long as domestic liquidity is intact, investors would put money in the small- and mid-cap space for the simple reason that there is more ‘value’,” he explained.
But don’t rule out this sector just yet. While the shelf life of a bubble can be hard to predict, they always have the best returns towards the end, according to Gan.
“The challenge is to figure out when the party will end. Froth can last for sometime, and riding it can be a very rewarding process.
“First, know the context of the market you are investing in. Be aware that easy money made is not fundamentally driven. Second, invest with caution and be nimble, as things could turn eventually,” he said.
If, or when, the ground shifts, institutional investors will all try to get out of the “same small door”, Gan quipped.
And in the event of a selldown, small-cap stocks are unlikely to enjoy the same buying support as blue-chip counters.
Gan noted that Hwang Investment Management’s small-cap portfolio had returned 63% over the past two years, 47% of which was recorded in 2013 alone. His strategy is not to be “sucked into obvious plays”.
“We think such a strategy, combined with an eye on when things could go wrong, would allow us to generate decent returns this year if the frothy market holds up,” he said.
The Small Cap Index was trading at a current price-to-earnings (PE) multiple of 20.9 times, compared with 17.1 times for the FBM KLCI, but a forward PE of 10.4 times, against the FBM KLCI’s 15.8 times, Bloomberg data showed.
Danny Wong of Areca Capital Sdn Bhd, however, takes the opposite view.
“There is no bubble in small-cap stocks. If you look closely, the rally was not broad-based, but limited to select counters.
“Our bias this year is actually toward the small-cap sector, where we still see value despite the run-up in prices,” he told StarBiz.
Wong, who is chief executive officer of local fund house Areca, said he expected small-cap stocks such as Inari Amertron Bhd and Globetronics Technology Bhd to benefit from improving electronics and electrical exports, as well as a stronger US dollar and growing demand for consumer electronics.
Wong believes other stocks that may be worth watching include O&G plays Barakah Offshore Petroleum BhdUzma Bhd and Coastal Contracts Bhd, while smaller-sized glove makers Kossan Rubber Industries Bhd and Hartalega Holdings Bhd have room for upside.
Eastspring Investments Bhd chief investment officer for equities Yvonne Tan also does not believe that small-cap stocks are setting up for a bubble.
“The rally in small-cap stocks was due to a PE expansion and rising appetite for small-cap ideas, as well as earnings growth. The Small Cap Index is trading at a significant discount to big-cap stocks.
“For select small-cap stocks, their risk-return is favourable vis-a-vis large caps. We see plenty of opportunities in the small-cap space.
“There are stocks with double-digit earnings growth trading at attractive valuations,” she said.
Credit Suisse had told clients in a December note that Malaysian small-cap stocks were poised for a difficult year amid a freeze in pre-election goodies, the Government’s subsidy rationalisation and rich valuations.
In particular, the research house highlighted that the premium between large- and small-cap stocks had narrowed to 6%, a far cry from the long-term average of 21%, which has the effect of boosting the attractiveness of blue-chip counters.
Citing an example, Hwang’s Gan remarked that news of Government contracts was all it took to lift the market capitalisation of a small-cap counter to nearly RM800mil from RM100mil just months before.

Why Individual Investors Almost Always Lose Money

Source: http://goldnews.bullionvault.com/why-most-investors-lose-money-013020133

Why Individual Investors Almost Always Lose Money
Wednesday, 1/30/2013 15:46

Are you making these mistakes...?

I'M GOING to tell you an unpleasant truth, writes Porter Stansberry for the Daily Wealth eletter.

Most of you reading this will not make money with your investments this year... or next year. Most of you, in all likelihood, will never make money in the stock market.

It may shock you to hear it. It might make you angry. It might fill you with strong doubts about my credibility.

I'm telling you anyway because I'm convinced the only chance you've got to become a successful investor is to start by acknowledging that reality. Once you know that individual investors generally fare poorly in stocks, you can begin to examine why...

We know most individual investors don't make money in the stock market from Dalbar... a Boston-based consultancy that studies actual mutual-fund returns. We know from the investment-management firm BlackRock, whose study is shown here...



We also know from discussions with dozens of certified public accountants that almost all their clients lose money in their personal brokerage accounts.

Why?

Let's start with the most obvious reason: The financial industry does not exist because it enriches its clients. The clients provide all the wealth required to maintain the financial industry.

The profits that power the branding and the marketing of mutual-fund companies and big investment banks came out of the pockets of their clients. Think about that. Think about it carefully the next time you consider following any financial institution's advice about what to do with your savings.

Investment banks exist to raise capital for corporate clients. They do not exist to give you a good stock tip or put you in a safe bond. (If you need a refresher course on the way Wall Street really works, read the famous book Liar's Poker.)

The other main reason people, on average, tend to fare so poorly in stocks is that very few individual investors know anything about how to value a security – a stock or a bond.

Let me give you a vital tip: If you don't know more about the value of something than the person who is selling it to you, the chances of you profiting from the transaction are extremely close to zero.

We've written volumes about how to value stocks and bonds. But... the writing is boring. It requires careful thought and attention. Most people, it seems, would rather trust some lines on a chart... Yes, sometimes these guides will work. But if you believe charts can compensate for a complete lack of basic financial skills... you will soon go broke in the stock market. That, my friends, is a fact. If you don't know how to value the business you're about to invest in, don't make the investment.

The last nail in the coffin of the failed individual investor is a complete lack of risk management.

Catastrophic losses happen for the same reason, every time. They don't happen because an investment idea didn't work out. Even great investors are only going to be right about stocks roughly 60% of the time. Catastrophic losses happen because people can't stand to take small losses. They allow them to grow into big losses.

There are two good ways to make sure this never happens to you. The first way is completely foolproof: Never invest more in any individual stock than you're OK losing. If it goes down 100%, it shouldn't matter to your financial well-being. That means if you're investing a total portfolio of $100,000... you'll limit your position sizes to $2,000 (or maybe $5,000 at the most). Worst-case scenario, you lose 5% of your portfolio. That's not going to kill you. With some kinds of companies (risky biotechs and mining stocks, for example), this is the only kind of risk-management technique that really works because the shares are too volatile for trailing stops...

The other way to prevent catastrophic losses is to simply decide, in advance, when you will sell. It might be on the basis of negative price action (a trailing stop). Or it might be at a fixed price – you'll sell if shares drop to less than $10, for example. Or you can use charts to find points where you no longer want to risk owning the stock.

I don't really care what kind of risk management you use... so long as you use something. I can guarantee that if you don't have your risk strategy figured out, sooner or later, you will suffer a catastrophic loss... and it will completely wipe out all your previous gains. That's just what happens.

This is the most important information I can possibly give you.

You need to realize that most investors will fail. You need to understand why they fail and how they fail. They fail because they allow their emotions to overtake their reason. They fail because they don't have the most basic tools – they don't know how to value stocks. And they fail because they eventually suffer a catastrophic loss.

I truly hope you'll take this essay to heart. I hope you'll look back on the investment mistakes you've made and think about why they happened. It wasn't just because you bought the wrong stock.

Find a way to eliminate these mistakes and you'll be on your way to becoming a more successful investor.


Porter Stansberry is founder and publisher of Stansberry & Associates Investment Research, a private financial publishing company based in Baltimore, Maryland, and editor of the monthly Porter Stansberry's Investment Advisory.

See the full archive of Porter Stansberry articles.

Please Note: All articles published here are to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it. Please review our Terms & Conditions for accessing Gold News, RSS links are shown there.

Wednesday, January 29, 2014

4 基础为经济护航 亚洲不会重演金融危机

Source: http://www.nanyang.com/node/596223?tid=462

(吉隆坡28日讯)经济学家认为,在新兴货币市场动荡下,亚洲虽无法幸免,但基于较强稳的基本面,料亚洲能够从这场动荡中安然度过。
阿根廷比索大跌,引起新兴市场货币危机蔓延的恐慌,加上大量资本撤走,印度及印尼的货币大跌,更让投资者担心1997/98年的亚洲金融危机会重演。
联昌国际投资银行经济研究部总监李兴裕在报告中指出,随着美联储开始减少债券购买量,在全球资本回退的环境下,亚洲是无法幸免的,但阿根廷货币风暴料不会蔓延至亚洲,不会陷入货币危机。
“我们相信在经济及金融基本面的扶持下,亚洲经济有更强的优势,且能够应对美联储缩减债券购买量所引起的市场动荡。因此,亚洲可以避免货币危机蔓延的风险。”
这也意味亚洲金融危机重演的可能性不大,投资者对此不必过度担忧。
李兴裕指出,有4项理由扶持其认为亚洲可应对动荡的看法。
【扶持经济4大因素】
第一:亚洲经济稳定增长。
第二:亚洲拥有强劲的外汇储备,且外债仍在可控制水平内。
第三:亚洲通胀率普遍仍未达到惊人水平。
第四:弹性的汇率让政策能够伸缩性应对波动的资本流向。
央行伸缩执行货币政策
在无需顾虑捍卫汇率在特定水平下,中央银行可伸缩性执行货币政策,有别于大部分亚洲经济在1997至1998年亚洲金融风暴期间,将汇率与美元挂钩。
因此,汇率将会调整至双向资本流向,这让金融体系更能应付外围经济冲击。
李兴裕补充,虽然亚洲拥有优势,但央行不能够阻止外资流出。
此外,若作出任何不正确的政策,将会减少政府对抗外围动荡环境的能力,且让经济对短期下跌风险变得更脆弱。
虽然大马无法从金融市场动荡中幸免,但私人界投资及经济转型执行方案(ETP)是国内推动力,且出口复苏将扶持2014年经济成长。
市场忧虑拖累亚股
李兴裕指出,区域股市大跌,主要是反映出投资者对新兴货币危机的忧虑,并非基本面出现变化,亚洲经济基础仍无损。
他认为,若中国经济成长动力严重放缓,及美联储比预期快缩减债券购买量,将会导致股市再度大跌。
“不过,这些风险不太可能会发生。”
同时,李兴裕认为东协市场的股市仍诱人,惟,维持给予印尼及印度“减持”的投资评级。


Nam Cheong - First salvo of the year

Source: http://singaporestockmarketnews.blogspot.com/2014/01/nam-cheong-first-salvo-of-year.html#more

 Nam Cheong - First salvo of the year 

Written By Stock Fanatic on Tuesday, January 28, 2014 | 28.1.14

Nam Cheong fired its first salvo of the year with the sale of four emergency response and rescue vessels (ERRVs) and one 6,600 bhp anchor handler worth US$70m in total. We lift our FY14-15 EPS forecasts by 3-13% as we factor in this and the US$66m vessel sales on 30 Dec 2013. However, we cut our FY13 EPS by 4% as the sale of a 5,000 dwt platform supply vessel did not materialise in 4Q13. 
We maintain our Add rating, with a higher target price, still at 8x CY15 P/E (peers’ average). Nam Cheong has recorded two consecutive record years of vessel sales and we believe that another record year should propel its share price to our target price.


What Happened
Nam Cheong has sold four ERRVs and a 6,600 bhp AHTS for US$70m to a repeat customer, Sentinel Marine, to which it had sold four EERVs a year ago. The vessels will be delivered between 3Q15-1Q16. The ERRVs would be built under Nam Cheong’s build-to-order model while the AHTS would be constructed as part of the group’s build-to-stock programme. Separately, we also incorporate into our earnings model the vessel sales worth US$66m made on 30 Dec 2013 - it sold three 5,150 bhp AHTS to its 49%-owned JV Bahtera Niaga Indonesia and one maintenance/work vessel to Icon Offshore. The deliveries are scheduled between 2Q14-3Q14. For the sales to the JV, we only factor in the revenue/profits of Nam Cheong’s unrelated interests in the JV.
What We Think
Leveraged for the upcycle. In our view, Nam Cheong’s business model works best in an upcycle, which is where we are now. Nam Cheong has achieved two consecutive record years of vessel sales (2012: US$425m; 2013: US$500m), and we expect vessel sales for 2014 to at least match that of 2013. 
4QFY13 earnings review

Nam Cheong is set to announce its 4Q13 earnings on 26 Feb, before the market opens. After our earnings cut for FY13, we now expect Nam Cheong to post RM45.7m core earnings for 4Q, bringing FY13 core earnings to RM180.8m (+32% yoy). We had previously expected Nam Cheong to sell its last vessel from its 2013 building programme in 4Q14 (a 5,000 dwt PSV est. at US$32m). We know expect the vessel to be sold this year. 

勝利者國際有望重估

Source: http://biz.sinchew.com.my/node/89195?tid=18

(吉隆坡28日訊)勝利者國際(SIGN,7246,主板消費品組)印尼設辦事處,國內訂單量強穩,分析員看好將多元化長期盈利基礎,盈利展望正面,不排除未來將重估及提昇其財測。

勝利者國際為國內最大廚房裝置業者,佔市場50%分額,目前手持2億令吉訂單,可忙碌至2016或2017年,同時也在競標價值6億令吉工程,其中2億8千萬令吉來自巴生河流域。

另外,該公司也計劃未來1至2年在印尼設立辦事處,相信該國購屋者願意付費裝置廚房,市場料在1至2年內達至成熟階段。

該公司也計劃脫售哥打白沙羅工廠地段,以4千900萬令吉在巴生購置工業地建設新工廠,資本開銷3千萬令吉,新廠料可在2015年竣工。

聯昌研究認為,大馬廚房裝置市場在10年內增長10倍,對該公司利好,亦看好拓展至印尼的計劃。

“這可多元化長期盈利基礎,減少對本地市場的依賴,未來3至4年內訂單量強穩,長期盈利展望正面。”

該行表示,隨著盈利、訂單不斷壯大,週息率也將與盈利同步增長,未來季度表現將向上重估,不排除會在下幾個季度提昇勝利者國際財測。

綜合上述正面因素,聯昌研究給予“加碼”評級,目標價2令吉63仙。(星洲日報/財經‧報道:郭曉芳)

联昌:可跑赢大市 投资者爱有惊喜小型股

Source: http://www.nanyang.com/node/596065?tid=462

(吉隆坡27日讯)联昌国际投行研究认为,高价值的小资本股将继续跑赢大市,而具备突发因素或意外惊喜的“外卡”(WildCard)型股项则非常吸引投资者青睐。
通过早前与亚洲和欧洲投资者会面,联昌国际投行研究发现,大马投资者最看好本地股市,风险胃口相当强劲,并对小资本股特别感兴趣。
但欧洲投资者则对大马股市最为谨慎,焦点围绕在大马和东协的宏观经济课题。
联昌国际投行研究主管黄大任表示,美国减少购债影响区域市场走弱,将牵连大马市场,投资者届时可趁机进场累积。
他指出,相比其他同等市场,大马仍具抗跌能力,足以面对抛售潮,目前跑输大市与小资本股拥有诱人估值,可跑赢大市。
综指年终目标2030点
整体上,黄大任对今年马股抱持谨慎但乐观看法,同时维持富时隆综指2014年杪的2030点目标。
联昌国际投行研究在巡回展了解到,市场持续聚焦小资本股项,投资者更是偏好“外卡”型股项,胜于一般的证券行首选名单。
目前,联昌国际唱好的小资本股,包括康乐(KAREX,5247,主板消费产品股)、胜利者国际(SIGN,7246,主板消费产品股)及Tune保险(TUNEINS,5230,主板金融股)。
至于“外卡”型股项,他们推荐巴拉卡岸外(BARAKAH,7251,主板贸服股)、勇达集团(ENGTEX,5056,主板贸服股)和金群利集团(MATRIX,5236,主板产业股)。
ECOWLD引发购兴
此外,联昌投行也发现,与实达集团(SPSETIA,8664,主板产业股)总裁兼总执行长丹斯里刘启盛息息相关的ECOWLD(ECOWLD,8206,主板产业股)非常吸睛。
联昌投行看好的经济转型执行方案(ETP)三大领域中,油气业回退幅度最小,但估值昂贵让投资者却步。
他指出,反观建筑业和产业近期走势疲弱,促使估值变得极具吸引力。
他们维持油气业首选股为沙肯石油(SKPETRO,5218,主板贸服股)、建筑业为金务大(GAMUDA,5398,主板建筑股),而马星集团(MAHSING,8583,主板产业股)是产业界首选。

Sumatec begins producing oil in Kazakhstan

Source: http://www.thestar.com.my/Business/Business-News/2014/01/28/Sumatec-begins-producing-oil-in-Kazakhstan/

KUALA LUMPUR: Sumatec Resources Bhd has started producing oil at the Rakushechnoye oil field in Kazakhstan.
It said the first well, under the re-entry and work-over programme, had been successfully completed rigless and brought on production.
In a statement, Sumatec said the well was “expected to produce initially between 100 and 150 barrels of oil per day” after a full production test had been completed.
It said it planned to re-open and perform work-over on nine more wells in the next three months.
Chief executive officer Chris Dalton said: “We’re very excited over the start of our oil production, and we’re really looking forward to see the results of the work-over programme in the next three months.”
Both Chris and chief operating officer Zulkifly Mohamad were at the field to witness the historic oil production from the well in the freezing -20 degrees Celsius weather.
The company said the start of oil production from the Rakuschechnoye Oil and Gas Field marked a key milestone in Sumatec’s oil production rejuvenation programme for 2014 and beyond.
It said that it was also a significant step towards turning Sumatec around in its recently completed regularisation plan.


MBSB FY13 earnings up 33.7% to RM597m

Source: http://www.thestar.com.my/Business/Business-News/2014/01/28/MBSB-FY13-earnings-up-33pt7pct-to-RM597m/

It said on Tuesday its revenue increased by a stronger pace of 37% to RM2.51bil from RM1.83bil. Profit before tax for FY13 of RM932.35mil, was 42% higher from RM656.22mil in FY12.
It rewarded shareholders with a single tier final dividend of 5%. Based on the enlarged number of shares of 2.621 billion shares (including the rights shares of 873.929 million) the final dividend payable would be RM131.09mil.
MBSB said its gross income from personal financing was higher due to the growth of personal financing portfolio.
As for mortgage loans and financing, the gross income was slightly lower mainly due to lower disbursement in FY13.
MBSB said gross income from corporate loans and financing were higher due to higher disbursements and lower individual assessment impairment allowance for the current year due to settlement of impairment accounts.
For the fourth quarter ended Dec 31, 2013, its earnings fell 27.2% to RM133.55mil from RM183.60mil. Its revenue, however, increased by 42.6% to RM695.47mil from RM487.52mil. Earnings per share were 7.66 sen compared with 7.40 sen.


Close YTL Power-1MDB race for RM11bil power plant explains delay in award

Source: http://www.thestar.com.my/Business/Business-News/2014/01/29/Close-YTL-Power1MDB-race-for-2000MW-power-plant-explains-delay-in-award/

PETALING JAYA: The decision to award the RM11bil Project 3B to build a 2,000 megawatt (MW) coal-fired power plant is “going down to the wire,” with the main contenders YTL Power International Bhd and 1Malaysia Development Bhd (1MDB) in a neck-and-neck race, according to sources.
Sources said while it was widely believed YTL Power would be the likely winner, there was now the possibility that the Energy Commission (EC) could be opting to pick 1MDB as the winner.
“It is a close call, no wonder the decision has been slightly delayed,” said one source, adding that the industry had been expecting a decision some time last week.
The source revealed that the EC had held a number of meetings in the last week alone with top government officials to discuss the matter.
YTL Power’s bid was the lowest in the tender called by the EC at 25.12 sen per kilowatt hour (kWh), compared with 1MDB’s 25.65 sen per kWh. Other bidders wereMalakoff Corp Bhd and Tenaga Nasional Bhd (TNB) that came in at 26.74 sen per kWh and 28.67 sen per kWh, respectively.
However, notably, one source reckoned that the EC was leaning towards 1MDB because YTL Power’s bid had a higher total cost. He explained that this was due to the location of YTL Power’s planned plant in Johor.
“There is a significant distance from the plant to the entry point of the grid, and there’s the question of who is going to bear the cost of building those transmission lines, not to mention the efficiency loss in transmitting that power,” he said.
It had already been reported that YTL Power’s proposed plant site in Tanjong Tohor in Johor was two to three times further from the major load centre to the national power grid as compared with other proposed sites in Selangor (Malakoff), Negeri Sembilan (1MDB) and southern Perak (TNB).
Under Project 3B, the greenfield power plant is to be built on a new site in the peninsula and be commissioned in stages through October 2018 and April 2019.
As at press time, the EC had yet to get back to StarBiz’s query, while YTL Power declined comment.
To be noted also is the fact that 1MDB’s bid is only marginally more expensive than YTL Power’s.
The state-linked firm has proposed to build its power plant on a piece of land next to its recently-acquired 1,400MW coal-fired power station in Jimah, Negeri Sembilan.
For 1MDB, a win would boost the proposed listing of its energy division, while for YTL Power, analysts said the prospect of a new power plant could possibly lead to a re-rating of its shares with the impending expiry of its first-generation power-purchase agreements for the Paka and Pasir Gudang power plants in September 2015.
1MDB is reportedly planning a US$1bil (RM3.28bil) initial public offering of its power assets targeted for the middle of this year, following a buying spree of power assets over the last two years totalling RM12bil.
In terms of funding, 1MDB has proposed to partly finance the 2,000MW power plant overseas and in a foreign currency via a combination of loans from Japan Bank for International Cooperation, US dollar-denominated corporate bonds and sukuk financing. 1MDB has partnered Japan’s Mitsui Corp in its bid.
YTL Power’s edge, however, is its cash hoard, which stands at around RM9.6bil.
Analysts said this could allow it to ring fence the constriction cost to avoid any strain on the balance sheet.
It would also be able to leverage on the construction and cement divisions within the YTL stable. YTL Power is partnering Johor royalty-linked SIPP Energy Sdn Bhd for Project 3B.

Maybank initiates coverage of BreadTalk with $1.40 target

Source: http://www.nextinsight.net/index.php/story-archive-mainmenu-60/924-2014/8045-initiation-reports-buy-breadtalk-buy-linc-energy-

Excerpts from analysts' reports

Maybank initiates coverage of BreadTalk with $1.40 target

Analyst: James Koh & Juliana Cai

breadtalk_maybank1.14Source: Maybank Kim EngInitiate BUY on this under-researched company with a TP of SGD1.40, implying 50% upside. BreadTalk is by far the most successful Singapore F&B company, boasting a solid regional presence for its homemade brands via more than 800 outlets across 15 countries. Its target for 2014 is to raise store count to 1,000.
 
Operational statistics are healthy with EBITDA growing rapidly. This should allay fears on BreadTalk’s lacklustre profit growth, hitherto blamed on poor management or a flawed business model though our analysis shows it is a matter of accounting. 

Going forward, higher-margin businesses should also help lift earnings. 
 
Thailand-based Minor International’s 11% stake may be a prelude to a takeover offer in the next 12-24 months. If so, this would be a bonus for investors.
 
China presence an attractive trait. Minor International (MINT TB, BUY, TP 24.30THB) has accumulated an 11% stake in BreadTalk Group since Aug 2013. 

The Thai hospitality and F&B group is noted for its history of acquisitions but reputation aside, we think its portfolio complements that of BreadTalk’s. We believe BreadTalk’s presence in China –more than 300 outlets in 48 cities – is definitely a key attraction.
 

Value emerging, act before it’s too late. We see value emerging. 

Our TP of SGD1.40 is based on 7X FY14E EV/EBITDA, which is only half of regional peers’ average. We expect BreadTalk’s net profit to grow at 26% CAGR over the next three years as expansion efforts start to bear fruit. 

Using a SOTP approach to cross-check the replacement value of the firm, we coincidentally arrive at a conservative net value of SGD1.40 per share (SGD403m). Initiate with BUY. 

周顯 - 跌市風頭火勢 千萬不要入市

Source: http://www.mpfinance.com/htm/finance/20140129/columnist/en30_en30.htm

周顯 - 跌市風頭火勢 千萬不要入市

2014年1月29日


【明報專訊】在大升市的時候買股票,可以賺到快錢,但賺的錢不多。在大跌市之後買股票,可以賺到大錢,但是等待的時間會很長久。在不升不跌的時候買股票,幸運的,或眼光好的投資者,可以用很短的等待時間,賺到很多的錢,但是,反過來說,如果看錯了市,也可以等上很長的時間,也賺不到錢,甚至是虧本。


所以說,在什麼的時間,也有買股票賺錢的機會,只有一個情,是千萬買不得的,這就是在大跌的當時,風頭火勢期間。而看情,現在就是這種市了。

我早在兩至三個月前,已經不敢看好了,主策略是細細注,大大聲的去玩,但自己還是買進了一些(自以為是的)「平貨」,例如中國忠旺(1333)和天工國際(0826),作長期投資。

看淡宜「細細注」 不應完全離場

現在雖然下跌了1000點,又有不少細價股被洗倉,但是,我並不能說我是猜中了市。因為太早睇淡是死罪,我在兩三個月前,已經開始睇淡,如果讀者聽了我的話,該是賺少了唔少錢!

但是反過來說,從炒股票的策略上,永遠有看錯市的可能。這正如看淡樓市,不能把自住的房子也賣掉,因為你會有可能看錯市。所以,當日我看淡後市,也只會「細細注,大大聲」的,不敢貿然離場,以免贏錢沒有自己的份。同樣道理,在今日的市,雖然跌了不少,後市還看不好,但我還是要選出值博率高的股票來炒,以免因看錯市而錯失良機。

又﹕我在星期一那天,認為東方匯財(8001)會短炒一轉,誰知大市跌400幾點,它當然也跟下跌,我就不敢買了,跟它又戲劇性地升回去,昨天居然還小踢了一轉,呀呀呀,好呀!

[周顯 投資二三事]

Tuesday, January 28, 2014

It's like 1997 all over again

Source:

Emerging markets

It's like 1997 all over again


Jan 27th 2014, 9:21 by P.F. | MUMBAI

“THE peso has gone to hell,” worried the Nobel-Prize winning writer V.S. Naipaul in an essay from the 1990s about Argentina. He also touched on Eva Perón’s sexual technique, beefsteak, class tensions in Buenos Aires and Jorge Luis Borges. Its limp currency is an elemental part of that South American country. And yet the news last week—that the partially pegged peso had dropped by 15%—has scared global investors.

At Davos, a gabfest for the world’s biggest egos, the talk turned from Jamie Dimon’s enormous pay packet to worries about an emerging-markets crisis. Currencies in the developing world fell to their lowest level since 2009. Along with Argentina, so Turkey, South Africa and Russia have been hit hard. There is violence on the streets of Kiev and Bangkok. The scare dragged down the S&P500 by 2% on Friday, January 24th. Then Monday morning the Asian bourses fell.

Emerging countries have already had a recent walk on the wild side: from May to August 2013, after the Federal Reserve made its first, botched, attempt to start winding down its bond purchases. At the prospect of an end to free money, funds were pulled from emerging countries that have benefited from a decade of easy inflows, and currencies and stockmarkets tanked. During the last few months of the year however things seemed to have stabilised.

Crises have a habit of coming in fits and starts, though, rather than in one big bang. For instance Thailand ran into trouble in July 1997. Four months later South Korea’s president warned his countrymen of the “bone-carving” pain to follow an IMF bail-out. It took over a year for Russia to blow up; its default didn’t happen until August 1998. The last mini-crisis took time to come to a head, too. After Argentina devalued and defaulted in 2001, many argued it was a cranky special case. But by mid-2002 the contagion had taken Brazil to the brink.

Since the sell-off of 2013, doom-mongers may argue, two things have got worse. First it has become even clearer that the rich world’s central bankers do not have much of a clue how to tame the beast they have created in the form of ultra-loose monetary policy. Ben Bernanke, the outgoing Fed chief, chairs his last policy meeting on January 28th and 29th. The Fed is expected to trim its bond purchases by a further $10 billion, to $65 billion a month. No doubt this will be accompanied by a torrent of elegant verbiage to show that the Fed is in command. But sceptics should look at Britain, where the newish central bank boss, Mark Carney, has abandoned the framework he put in place only half a year ago. It was supposed to govern the pace at which monetary policy would return to an even keel. The process of normalising central banks’ balance-sheets is going to be mighty unpredictable and disruptive.

The second change for the worse is that the emerging world’s recovery in exports looks tepid. The hope had been that as the Western world grew faster it would suck in more goods from emerging economies, helping them to improve their current-account balances and making them less dependent on foreign capital inflows.

But the latest data are mixed on this front. In both Brazil and Turkey current-account deficits have widened since the summer. China’s exports grew 4% year-on-year in December, which was slower than expected. At every sign that China is in trouble investors run from emerging economies—it is one national economy that serves as both a proxy for Western appetite for exports and as a source of demand in its own right, particularly for commodities.

To my mind the doom-mongers are too pessimistic. Something other than a generalised rout is taking place. As we have argued before, most emerging economies have more flexible exchange rate policies now than they did in the 1990s—falling currencies can be a healthy sign of adjustment, provided the decline is orderly. And this sell-off has been discriminating. India, which was clobbered last summer, has done all right. It has a new central-bank boss in place and has narrowed its current-account deficit, largely by banning gold imports. Mexico and South Korea are perceived to have reforming governments and they too continue to command investors’ confidence. The Philippines, long dismissed by investors as a land of eternal promise and guaranteed disappointment, managed to issue ten-year sovereign bonds with an interest rate of just 4% earlier this month—again, its government is judged to have a reformist bent.

This latest panic is partly about politics. Look at the list of worst-hit countries. Turkey’s currency has collapsed due to a corruption scandal that has engulfed its prime minister. Venezuela, which also devalued last week, is a wreck. South Africa is facing a wave of industrial unrest. Ukraine is being racked by huge protests. The Thai baht has so far held up surprisingly well—but our correspondent believes the country’s very unity is now at stake.

What might cause the panic to spread from these troubled spots to all the emerging economies? Perhaps if more countries faced either social instability or a sense of political impasse, making tough reforms harder. This is not impossible—India and Indonesia face elections this year which could rouse passions or result in weak governments. Brazil faced widespread unrest last year.

A second trigger might be a sense that the emerging economies are fibbing about the state of their financial systems. The 1997 crisis spiralled when it emerged that many private banks were in dreadful shape and that some monetary authorities had become captives of the private sector. The central banks of Thailand and South Korea misled the outside world, respectively, about their reserves position and their country’s dollar liabilities.

One common characteristic of all emerging countries today is that they have all shared in the colossal credit boom. Loans have been growing by double-digit rates for many years. Vietnam has already blown up—it has set up a “bad bank” to try and clean up its lenders. Perhaps more countries are yet to own up to big, bad debt problems of their own. If you want to give yourself a fright on this front consider the share price of Standard Chartered, a Western bank largely exposed to the emerging world. It has collapsed.

So there are two things to watch for signs that the present panic might morph into something much nastier. First the streets—for more social unrest and political gridlock. And then the banks—for any sign that their books are rotten.

Hua Yang Bhd - Counting on Affordability

Source: http://klse.i3investor.com/blogs/kenangaresearch/45566.jsp

We came out from HUAYANG analysts’ briefing yesterday feeling more reassured on its prospect in the affordable housing segment which is expected to remain strong. We believe our FY14 and FY15 sales estimates are achievable at RM0.62b and RM0.77b, respectively. Investors can expect higher billings in 4Q13, as Parc @ One South had been completed and ready for handover while its unbilled sales is at a high of RM838m. However, our earnings estimates for FY14 and FY15 are lowered by 1%-8%, respectively, as we push back the recognition for its newly launched projects to adjust for the timing differences. Subsequently, we raised our dividend from 8.8 sen to 11 sen as we were guided that the group would be comfortable with a higher payout ratio. Maintain OP with an unchanged TP of RM2.33. At current levels, dividend yields are attractive at 6.2% and 7.5% for FY14E and FY15E, respectively.

Encouraging sales. Year-to-date, HUAYANG’s performance has been highly encouraging as they managed to rake in property sales of RM0.58b, closing on to its full-year sales target of RM0.60b. Upcoming launches will be from Johor, namely (i) The Gardens @ Polo Park (GDV: RM54m) featuring a small enclave of semi-detached residentials and (ii) Citiwoods @ Jalan Abdul Samad (GDV: RM208m) which are affordable high-rise residentials. Its Puchong and Seri Kembangan projects (affordable housing) will likely be launched at end FY15.

Net gearing still manageable. HUAYANG’s net gearing had hit a new high of 0.7x, due to new land acquisitions in Puchong and Seri Kembangan, which are affordable housing projects. Management indicated that there would not be any more land banking in the near-term and would be expecting its net gearing to come down to a comfortable level of 0.6x following the handover of Parc @ One South project in 4Q14 and also higher billings recognition from Gardenz @ One South and Flexis @ One South which has reached completion stages of c.40% and c.30%, respectively. It is comforting to note that the company will not be embarking on any new land banking, as its net gearing has hit our maximum comfort level. Additionally, the group has sufficient GDV of c.RM4b (including ongoing projects) to sustain their growth for the next 3-4 years.

Lowered earnings on timing difference. FY14E and FY15E earnings have been lowered by 1% and 8%. We maintain our FY14 and FY15 sales assumptions of RM0.62b and RM0.77b. However, the timing of project launches (e.g. Greenz, Metia, and Sentrio) were later than expected. Meanwhile, its Sentrio project will take longer than the typical 36 months recognition period as HUAYANG managed to get a six months extension to 42 months for the particular project. As a result, we have pushed back, as well as, stretching out recognition for this project.

Maintaining a healthy dividend payout. Positively, we were guided that the group will be able to give a higher payout, as the management aims to maintain a healthy level of payout to reward its shareholders. Hence, we have increased our payout ratio from 30% to 38% which increases our NDPS to 11.0 sen (6.2% yield) from 8.8 sen. To date, for 9M14, the group has paid out 5.0 sen, implying 4Q14 dividend of 6.0 sen.

OUTPERFORM maintained. We are reiterating our OUTPERFORM recommendation on HUAYANG with an unchanged TP of RM2.33 which is at a 20% discount to its DCF-driven RNAV @ 10% WACC as we believe that HUAYANG is well positioned for the affordable housing market which will continue to enjoy resilient demand for years to come. At current levels, dividend yields are attractive at 6.2% and 7.5% for FY14E and FY15E.

Source: Kenanga

Sumatec reviewing Rakushechnoye oil field reserves

Source: http://www.thestar.com.my/Business/Business-News/2014/01/27/Sumatec-reviewing-Rakushechnoye-oil-field-reserves/

KUALA LUMPUR: Sumatec Resources Bhd is carrying out an internal review of the oil and gas reserves in the Rakushechnoye oil field in Kazakhstan.
It said on Monday that it believes there were “potentially more oil and gas reserves in the field than those already certified”.
However, the company said this would only be confirmed by a new reserves certification to be conducted by an independent competent body and expected to be completed in the later half of 2014.
Sumatec was clarifying a news report that it is believed to have found a larger pool of oil and gas at its oil field in Kazakhstan.
It also corrected the news report that the discovery of additional oil and gas resources may warrant a change in its forecast net profit of RM86mil for the 2013 financial year and RM69mil for 2014.
Sumatec said while it expected the enlarged certified reserves would contribute significantly to the company’s long term earnings, but with immaterial impact to the earnings for 2014. 
“The company therefore does not intend to revise the forecast earnings for 2013 and 2014,” it said to clarify the report.
Sumatec also clarified the report that it would have to reimburse Markmore Energy the cost of exploring and developing the oil field amounting to US$135mil (RM450mil), and spend another US$60mil on infrastructure to speed up production.
The company pointed out that under the joint investment agreement signed in March 2012, Sumatec paid US$95mil to Markmore Energy for the rights to share the oil profit with Markmore, and another US$40mil as performance guarantee.
“The performance guarantee is to be recovered by Sumatec from future royalty payments to Markmore. Sumatec expects to spend about US$60mil for capital expenditure over the next 12 to 24 months, which is fully recoverable fromCaspiOilGas LLP, the concession owner,” said Sumatec. 

Cypark launches RM65mil solar park in Negri, its third

Source: http://www.thestar.com.my/Business/Business-News/2014/01/27/Cypark-launches-RM65mil-solar-park-in-Negri-its-third/

RANTAU: Renewable energy developer and green engineering solutions provider,Cypark Resources Bhd, has completed on Monday a RM65mil solar park – its third renewable energy park project – in collaboration with Selasih Mentari Sdn Bhd in Negri Sembilan.
The solar park, launched by Negri Sembilan Mentri Besar Datuk Seri Haji Mohamad Hasan, is located in Kuala Sawah, Rantau, and said to have a 6,475MWh annual generation capacity and capable of powering approximately 7,000 basic homes with green electricity. 
The Kuala Sawah renewable energy park is Cypark's third solar park project in Negri Sembilan and the fifth for Peninsular Malaysia.
The other sites in Negri Sembilan are located in Pajam and Bukit Palong, while another two solar parks are in Kuala Perlis, Perlis and Rimba Terjun in Pontian, Johor.
The latest park utilises 20,192 solar panels, 25km of electrical cabling and eight (8) units of centralised inverters on 21 acres of reclaimed landfill, and also houses a control building and an electrical room.
The five solar parks constructed by the Group produce a total of 42,545MWh annual generation, saves the release of up to 29,357 tonnes of carbon dioxide and reduces annual methane released into the atmosphere by 1,398 tonnes.
Cypark said its projects showed that the company had developed the technical know-how to generate renewable energy on remediated landfill sites, where waste biomass, landfill gas and solar rays could be harnessed to produce green energy – Bernama

Monday, January 27, 2014

More oil, gas find for Sumatec?

Source:

RAKUSHECHNOYE FIELD: New Kazakhstan discovery may warrant change in earnings forecast

Sumatec Resources Bhd is believed to have found a larger pool of oil and gas at its oil field in Kazakhstan, people familiar with the matter said yesterday.

A Sumatec spokesman declined to comment as the company is still getting feedback from its people in the Central Asian country.

“We are evaluating the data and with the rollout of commercial production soon, we will make an announcement to the stock exchange once we have digested the new information,” the spokesman added.

Business Times understands that Sumatec will file a statement to the stock exchange before the week is over.

The discovery of additional oil and gas resources may warrant a change in its forecast net profit of RM86 million for the 2013 financial year and RM69 million for 2014.

Tan Sri Halim Saad, who controls some 25 per cent of Sumatec, reportedly told shareholders at the company’s last extraordinary general meeting that it expects oil production to hit two
million barrels by the third quarter of next year.

Sumatec currently manages the Rakushechnoye oil and gas field in Mangystau, Kazakhstan, after reaching an agreement with Markmore
Energy (Labuan) Ltd and CaspiOilGas LLP for the commercial development and production of the field.

Markmore Energy and CaspiOilGas hold the concession for the field until 2025 and both companies are controlled by Halim.

As part of the deal, Sumatec will have to reimburse Markmore Energy the cost of exploring and developing the oil field amounting to US$135 million (RM450 million), and spend another
US$60 million on infrastructure to speed up production.

Saturday, January 25, 2014

消息:日产300桶油气 传幸马泰哈萨克油田投产

Source: http://www.nanyang.com/node/595081?tid=462


(吉隆坡23日讯)消息透露,幸马泰资源(SUMATEC,1201,主板贸服股)位于哈萨克油气田已投产,初期可日产200至300桶油气。
知情人士向《南洋商报》透露,与大股东丹斯里哈林沙艾合作的Rakuscheknoye油气田,已正式进入投产阶段,该公司将在近期公告详情。
“初期的产量是每日200至300桶,相信在2至3个月内,就可逐步达到所预期的每日2000桶目标。”
哈林沙艾是我国知名企业家,早前与幸马泰资源签署合约,后者将负责Rakuscheknoye油气田的发展、执行和生产计划。
曾经掌控玲珑(Renong)的哈林沙艾,早前与陷入财务困境的幸马泰资源合作,被外界视为他欲在大马商界东山再起的踏板。
玲珑经过重组后,成为目前的UEM集团。
消息人士披露:“幸马泰资源债务少,且在油气勘探领域上颇具发展潜能,是哈林沙艾入股原因。”

Gabungan AQRS picky on jobs

Source: http://www.thestar.com.my/Business/Business-News/2014/01/25/Gabungan-AQRS-picky-on-jobs-It-only-bids-for-highmargin-projects-as-property-division-helps-smoothen/

THE start of the year is always an interesting time to scour the market for interesting gems. One company that fits the bill is construction and niche property player Gabungan AQRS Bhd.
Gabungan is considered a relatively new player in corporate Malaysia; it was listed in July 2012 at a price of RM1.18, with a valuation of 8.4 times based on its 2011 earnings. Today, the stock price is trading below its initial public offering price at RM1.08 with a valuation of 9.56 times.
Now, market cap-wise, it is sitting right smack in the middle of the pack with RM383.7mil. It is bigger than players such as TRC Synergy BhdCrest Builder Bhdand Kimlun Corp Bhd, but a lot smaller than players like IJM Corp BhdGamuda Bhdand WCT Bhd.
As it stands, Gabungan’s statistics look quite promising. It has been growing at a compounded rate of 15% over the last five years. It has an order book of RM1.4bil, where some RM781mil is unbilled. Gabungan is currently tendering for RM1.5bil worth of jobs.
It has completed jobs such as the Lebuhraya Damansara Puchong extension for RM277mil and the Seremban-Senawang federal road for RM110mil. Ongoing jobs include construction works for the Klang Valley Mass Rapid Transit worth RM303.5mil. This job entails the construction and completion of the viaduct guideway and other associated works for the rail project from Sg Buloh to Kota Damansara.
Just last month, it bagged its latest contract – the construction of two blocks of 28-storey service apartments for RM172.99mil from Tropicana Metropark Sdn Bhd. Hence, the momentum for Gabungan has been quite good.
Historically, Gabungan enjoys relatively high gross profit margins of 16% to 28% in its construction business. This is due largely to its experienced management team and their shrewdness in selecting projects.
Chief executive officer Alvin Ng, who is also the founder and single largest shareholder (18.24%), says Gabungan is picky when it comes to bidding for jobs.
“We don’t bid for a job knowing the margin isn’t good. The fact that we have a property division also allows us to be picky. Property earnings ‘smoothen’ the company’s earnings as a whole and allows us to choose jobs for the construction division,” says Ng.
The ambitious and impatient Ng is certainly not satisfied with Gabungan being classified as a mid-cap company. He wants the company to become a billion-dollar entity in the not-so-distant future.
“For 2014, of course, we are looking to repeat our growth patterns of the past. However, for our construction tender book, we are now tendering for more public private partnership (PPP) and privatisation jobs. We want to solidify the company with recurring income with the PPP jobs,” said Ng.
Besides this, it is an open secret that Gabungan is close to clinching a “substantial portion” of the new Pahang administration complex project in Kota SAS, Kuantan, valued at RM400mil. Gabungan’s portion is said to be worth RM250mil.
This is perhaps not surprising, as on Sept 4, Gabungan had announced that it had subscribed for a 30% stake in a special-purpose vehicle (SPV) – Kreatif Sinar Gabungan Sdn Bhd.
The purpose of this SPV is to undertake the construction of the proposed administrative building in Pahang. The other shareholders are Kreatif Selaras Sdn Bhd, with a 65% stake, and Sinar Realiti Sdn Bhd, with 5%.
“We are also looking to strengthen our mechanical and engineering (M&E) segment and are on the lookout to acquire such a company. By having an M&E division, we can save significant cost and further improve our margins,” says Ng.
Sub-contractors
He says Gabungan is in talks with a few parties for a possible merger and acquisition exercise to set up an M&E division. At the moment, it outsources its M&E works to sub-contractors.
Gabungan’s property division has been beefed up since it first started in 2004. More recently, it reported a good take-up rate for its recently launched development – The Peak in Johor Baru. The RM557mil condominium development is now 36% sold.
“People see Gabungan as a construction player and not so much as a property player. Sure, we started as a construction company, and it is contributing some 70% to our bottom line. However, moving forward, the contribution from the property division will increase, especially with the sales we had locked in last year. We are encouraged by the take-up rates for our developments. We are also continuously looking for pockets of land in the Klang Valley and the southern region,” he adds.
To date, the group’s main property projects are The Peak, Contours in Ulu Klang, The Avenue @ Kinrara and Gombak Grove @ Setapak. These projects boast some RM440mil in gross development value (GDV) and will keep the company busy over the next three years.
Ng says Gabungan will be launching two developments in the second half of 2014 – a 682-unit apartment project in Kinrara with a RM330mil GDV and West Lake apartments in Puchong, with a GDV of RM645mil. It will have 1,142 units.
“Yes, the property market does appear more subdued with the cooling measures announced by the Government. However, I also think that there has been some over reaction. Certainly, the first group of players to be taken out from the property equation are the speculators. But there is real demand when it comes to affordable houses. That is our strategy. That is why we will be launching properties below RM500,000,” explains Ng.
For the third quarter to Sept 30, 2013, Gabungan’s net profit was up 59.78% to RM6.29mil on the back of a 4.53% drop in revenue to RM105.46mil.
The construction division contributed some 70.91% of the current quarter’s revenue.
For the nine-month period, net profit was up 98.25% to RM36.91mil on the back of a 14.91% increase in revenue to RM292.19mil.
RHB Research says the core nine-month profit was up 17% to RM21.9mil, excluding the RM15.1mil in land disposal gains. Lower margins were booked by both its construction and property divisions due to rising cost pressures.