Reports » Malaysia

Malaysia stock market and companies daily report (March 04, 2013)

Contributed by Shares Investment

RHB Tie Up With JBIC To Fund And Develop Green Projects
RHB Bank has entered into a collaborative agreement with the Japan Bank for International Cooperation (JBIC) for the development and funding of environmental sustainability projects in Malaysia and ASEAN, in line with the corporate world’s green initiatives. Under the collaboration, RHB has identified two local projects, each to be funded US$50 million (RM154.73 million) by JBIC, while another is in the pipeline. “RHB will be the window to disburse the loans for eligible projects, and there are conditions to follow, skewed towards environmental preservation,” said managing director Johari Abdul Muid. According to JBIC chief operating officer and senior managing director Fumio Hoshi, JBIC will provide the conditions by which projects are qualified for the loan; nonetheless, RHB reserved the right to select the deserving project. He highlighted that while RHB had been the first local bank to approach JBIC for such collaboration, JBIC would be open to interest from any bank. The collaboration which is the first of its kind in ASEAN, marked the fifth financial collaboration between RHB and JBIC.
Significance: RHB believes the collaboration would spur both the large corporations and small and medium enterprises to venture into green projects. Moving forward, the group will continue to enhance its domestic presence and, simultaneously to step up efforts to play a bigger and more active role in the international scene through strategic collaborations with like-minded reputable partners such as JBIC.

Genting Plans Proceeds Of Sales For Indonesian Ventures
Genting is expected to use the sales proceeds from its power division, Genting Sanyen, to invest in its Indonesian power, oil and gas projects; said analysts. Last August, Genting disposed its 720 megawatts (MW) Genting Sanyen power plant in Kuala Langat to 1Malaysia Development (1MDB) for RM2.3 billion. Currently Genting has a 660MW coal-fired power plant which is under construction in Banten, West Java, Indonesia. The RM3.2 billion Banten plant is scheduled to commence operations in 2017. According to CIMB Equity Research, Genting’s power and oil and gas projects in Indonesia would need about RM4 billion in total capital expenditure. The research house noted that Genting also has interests in four production-sharing contracts, which is signed with BPMIGAS, Indonesia’s oil and gas supervisory body. CIMB believes Genting will continue to invest in non-gaming businesses, while Genting Singapore, Genting Malaysia and Genting Hong Kong will be confined to the gaming merger and acquisition activity.
Significance: CIMB views Genting’s Indonesian investment as a “negative surprise” as the fund could be better allocated to gaming opportunities, which in turn would lead to a better re-rating of Genting’s shares. On the other hand, other analysts were “neutral” on Genting’s move, since Genting has been in the power business for a time, hence it is capitalising on business opportunities in the sector.

Bearish Week Expected for CPO Futures
Crude palm oil (CPO) futures prices are likely to turn bearish this week on Bursa Malaysia Derivatives amid lower export data released by cargo surveyors and weak global economic report. The market slowdown is said to continue in the absence of positive external factors, said Interband Group Senior Palm Oil Trader Jim Teh. “I expect prices to hover between RM2,200 and RM2,300 per tonne this week as traders are cautious ahead of the annual palm oil conference to be held here this week,” he said. Bursa Malaysia had planned a three-day conference from 4th to 6th of March which will provide traders insights to the latest market developments from leading industry analysts such as Dorab Mistry and James Fry. Teh said traders should also remain cautious as lower export are expected to be released later this week by cargo surveyors, Intertek Testing Services and Societe Generale de Surveillance.
Significance: Weekly turnover advanced to 197,275 lots from 148,107 lots last week while open interest increased to 195,630 contracts from 186,706 contracts last Friday. On the physical market, March South declined RM120 to RM2,340 per tonne.