MY Morning Wrap | Bank Negara Expected to Maintain OPR at 3% for Next 6-12 Months - Kenanga Research

The $S&P 500 Index(.SPX.US)$ lost 0.4% and the $Dow Jones Industrial Average(.DJI.US)$ declined about 0.5%, or 159 points. The $Nasdaq Composite Index(.IXIC.US)$ lost 0.8%. The declines mostly negated Monday's blue-chip-driven gains and resumed the slide stocks have been on since the start of August.

$PETDAG(5681)$ :UOB Malaysia has announced a tie-up with PetDag and its unit, PETRONAS Lubricants Marketing (M) Sdn Bhd, to provide end-to-end financing to about 1,000 dealers and distributors. The bank said in a statement the UOB Dealer and Distributor Financing Programme is designed to provide access to greater funding for dealers and distributors within the ecosystem.

$HEXTECH(5136)$: Hextar Technologies Solutions Bhd's subsidiary, CIBC Technology Sdn Bhd, has entered into a memorandum of collaboration (MOC) with CIDB IBS Sdn Bhd to enhance the digital Industrialized Building System (IBS) products e-commerce marketplace platform in the construction sector. The collaboration outlines the foundations for a potential joint venture, it said in a statement today. The venture focuses on enhancing CIDB-IBS’s IBSW are platform while promoting and marketing CIBC’s e-commerce marketplace.

$MBSB(1171)$: With Malaysia Building Society Bhd (MBSB) set to be a full-fledged bank post-merger with Malaysian Industrial Development Finance (MIDF), the enlarged group could potentially see a better top line delivery ahead, says Kenanga Research. In a note, the research firm said the group’s operations will be more efficient post-merger, resulting in improved revenue performance. “Their respective portfolios reflect minimal overlaps in terms of product offerings and hence could see more complementary benefits. “At the same time, it presents an opportunity to consolidate and optimise back-end operating functions. “A successful execution could lead the enlarged bank to come closer to delivering double-digit return on equity, as aspired by the group,” said the research house.

$MSC(5916)$: Malaysia Smelting Corp Bhd (MSC) reported a net profit of RM28.45 million for the second quarter ending June 30, 2023 (2QFY2023), marking a 27.89% decrease from RM39.45 million compared to the previous year. The dip was attributed to lower profits in the tin mining segment. Despite a higher sales quantity of refined tin, the company faced a lower average tin price of RM116,500 per metric tonne (mt) in 2QFY2023, down from RM158,900 per mt in the same period last year. This resulted in MSC’s revenue declining by 20.01% to RM327.01 million from RM408.84 million year-on-year, it told the stock exchange today.

$MUHIBAH(5703)$: Muhibbah Engineering (M) Bhd is a prime beneficiary of a revival in global travels, particularly by Chinese tourists, according to CGS-CIMB Research. Muhibbah owns an effective 21% stake in Cambodia Airports, the holder of the concession for the Siem Reap, Phnom Penh and Sihanoukville airports, which expires in 2040. In the financial year 2017 (FY17) to FY19, the Cambodian airport concessions are estimated to have contributed about 57% to 70% of Muhibbah’s net profit. “While travel demand has recovered globally since China reopened its borders early this year, it has been constrained by low flight capacity and slow visa approvals, which we believe should pick up and boost travel demand. “Passenger arrivals to Cambodia were 2.38 million in 2022, still a far cry from 2019’s pre-pandemic levels of 11.6 million,” CGS-CIMB Research said in a note.

$SUNVIEW(0262)$: Sunview Group Bhd’s subsidiaries, Fabulous Sunview Sdn Bhd and Solarcity REIT Sdn Bhd, have been selected as solar power producers under the Corporate Green Power Programme (CGPP). Solarcity REIT, one of the 22 entities selected to be a solar power producer under the CGPP, has been allocated an export capacity of 29.99 megawatt (MWac), which is the maximum quantum assigned to a solar power producer (SPP). Meanwhile, through a consortium with JAKS Solar Power Sdn Bhd and Ann Joo Green Energy Sdn Bhd, Fabulous Sunview Sdn Bhd has also been allocated with an export capacity of 29.99MWac.

$AEMULUS(0181)$: Penang-based equipment vendor Aemulus Holdings Bhd has announced its third consecutive quarterly loss, attributing it to cautious customer capital expenditure, semiconductor industry slowdown, and delayed deliveries due to customers’ expansion deceleration. The net loss widened to RM6.9 million for 3QFY2023, compared to RM4.69 million in the previous quarter, as operating expenses, research and development costs, and finance expenses surged. Revenue for the quarter dropped by 77.36% to RM3.86 million year-on-year. Cumulatively, the group reported a net loss of RM16.36 million for the first nine months of the year, contrasting with a net profit of RM10.84 million in the same period of FY2022. Aemulus anticipates a sluggish recovery in 4QFY2023 due to persistently weak business sentiment.

$LIONIND(4235)$: Lion Industries Corp Bhd has scrapped its plan to acquire 80 acres of sub-divided leasehold agriculture land in Sepang for RM23 million. The group said its wholly-owned subsidiary LLB Bina Sdn Bhd has signed a deed of mutual termination with the land owner, Premier Land Resources Sdn Bhd, to terminate the agreement in relation to the acquisition entered in January last year. Premier Land will repay the purchase consideration to LLB Bina, added Lion Industries in a bourse filing on Tuesday (Aug 8).

$EPMB(7773)$: EP Manufacturing Bhd (EPMB) wholly-owned subsidiary, EP Blueshark Sdn Bhd (EPSB), has signed a collaboration agreement with Grabcar Sdn Bhd and Blueshark Ecosystem Sdn Bhd to form a working relationship and jointly explore business opportunities. Under the agreement, EPSB will work with Grab and Blueshark to promote and champion Green Mobility and Environment, Social and Governance (ESG) programs. Together, these programs aim to convert 80,000 Grab driver-partners and delivery-partners from users of internal combustion engine (ICE) motorcycles to users of electric vehicle (EV) motorcycles.