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Reports » Malaysia

Malaysia stock market and companies daily report (March 31, 2014)

March 31, 2014, Monday, 05:47 GMT | 00:47 EST | 10:17 IST | 12:47 SGT
Contributed by Shares Investment


Maybank Banks In On Overseas Operations

- Malayan Banking (Maybank) is expected to meet its target of deriving 40 percent of total income and gross profit from overseas operations next year through organic and inorganic growth.

- Currently, foreign contribution stands at 30 percent and the bank is positive that it can go up to 33 percent or 35 percent by end-2015 from organic growth alone. However, to achieve the 40 percent target, it will have to make more investments in the form of acquisition of regional financial institutions in high potential regional markets such as Thailand, Indonesia, the Philippines and Singapore.

- Notably, Singapore is Maybank’s largest foreign contributor at about 14 percent in pre-tax profit and will continue to grow. The bank is looking to expand its foreign customer base and improving cross-selling to realise the target.

Significance: While optimistic on the bank’s growth potential and given that the domestic segment is expected to enjoy sustained growth with gross domestic product projected to increase five percent against last year’s 4.7 percent, the group remains cautious due to external uncertainties globally.


Tradewinds Expects RM2b Profit

- Tradewinds Corporation is expecting a net profit of RM2 billion from its Perdana Quay integrated resort development.

- The development involves some 96 hectares of land at Pantai Kok-Teluk Burau on the northwest of Langkawi, and carries a value of RM4 billion. The development will be carried out in six phases over the next 10 to 12 years.

- The first phase includes natural and family-oriented attractions like theme parks as well as retail outlets, hotel and convention facilities aimed at attracting China, Middle East and United Kingdom tourists and shoppers.

Significance: Tradewinds will finance the project via debt-financing and equity and did not rule out the possibility of tying up with specialist investors to build its proposed water theme park.


MIDF Research Maintains “Neutral” Rating On YTL Power International, Target Price RM1.83

- Despite missing the opportunity to build, own and operate the 2,000 megawatts Track 3B coal-fired power plant, YTL Power International has reaffirmed that it will continue to bid aggressively for future power generation projects, with the upcoming ones rumoured to be Tracks 4A and 4B.

- MIDF Research believes YTL may have an edge over its competitors if it is able to put in competitive bids again, as it has an established track record with gas-fired power generation since making its debut as one of the first generation independent power producers back in the early 1990’s.

- Price competition continues to intensify as Singapore advances into full liberalisation of its electricity market. As an increasing number of players in the electricity market bid aggressively by offering lowest possible prices.

Significance: MIDF Research maintains “Neutral” rating with a positive bias on YTL Power International with a target price of RM1.83 based on sum-of-parts valuation at a 20 percent discount due to poor visibility of solid near term earnings growth drivers.