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Reports Malaysia

Malaysia stock market and companies daily report (May 02, 2014)

May 2, 2014, Friday, 04:34 GMT | 00:34 EST | 09:04 IST | 11:34 SGT
Contributed by Shares Investment

Poh Huat Resources Chases Larger Production Capacities

- Poh Huat Resources Holdings intends to set aside RM36.3 million as capital expenditure to improve production capacities at its Malaysian and Vietnamese facilities.

- RM20 million would be spent on upgrading most of its machines which have been used for the past 15 to 18 years at its five factories. The remainder will be channelled towards its two manufacturing plants in Vietnam.

- The bottom line contributions from its Vietnam plants have been growing, thus, warranting the investment in its facilities.

Significance: With the new machines and automation at the local plants, Poh Huat targets lower dependency on foreigners as production workers in the long term. The firm is aiming to half its foreign workforce of 800 within the next three years.

Puncak Niaga Bags RM97m Contract

- Puncak Niaga Holdings inked an agreement with the Ministry of Rural and Regional Development as a contractor for the Projek Menaiktaraf Loji Rawatan Air Sarikei project in Sarawak, Malaysia.

- The contract, worth RM97 million, involves the construction, completion, testing and commissioning of a 30 million litres per day water treatment plant.

- The contract is slated for completion by October 2015.

Significance: The contract is expected to contribute positively to Puncak Niaga’s financial performance and balance sheet for FY14.

RHB Research Maintains Neutral on Sunway REIT

- The research house noted that Sunway REIT’s 3Q14 results came in line with expectations with a distribution per unit (DPU) of RM0.021 declared for the quarter.

- Higher property expenses and a demanding short term outlook for its commercial and hospitality assets have prompted management to maintain its flattish DPU growth guidance.

- According to RHB Research, management shared that the provisional assessment rates for its Kuala Lumpur-based properties had shot up by between 40 percent and 200 percent. Sunway REIT has appealed to the Kuala Lumpur City Hall and is awaiting the results of its appeal.

Significance: Notably, Sunway Pyramid has continued to record decent rental reversions, which RHB Research reported should help to lift earnings over the near-term.