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CMS among 70 companies highlighted in Maybank&#39;s Invest Asean <b>...</b> Berita Sarawak - News 2 Sarawak

CMS among 70 companies highlighted in Maybank&#39;s Invest Asean <b>...</b>

Posted: 02 Apr 2014 09:11 AM PDT

KUCHING: Cahya Mata Sarawak Bhd (CMS is among 70 companies brought forward by Maybank Kim Eng in its Invest Asean 2014 Ideas Book released yesterday, listing top performers across the region.

"As one of the world's largest and fastest growing economic region, Asean offers the investment diversity and sectoral breadth in world class blue chips as well as budding companies that are still in the nascent stage of growth," highlighted Maybank Kim Eng in the report.

"With Asean's demographic dividend and young vibrant workforce supporting a secular uptrend in income, these dynamics should help Asean economies flourish for the next lap of growth."

The firm explained the method used to pick these companies included a complete spectrum of equities, fixed income, foreign exchange (forex), and economics research.

"The art of making money is to stay close to the ground, to spot mispricing during times of irrational market behaviour and anticipate sturctural inflexion points in the corporate earnings cycle.

"Whether you are long-only or an alpha hedge fund, Maybank Kim Eng's presence in six key Asean markets and expansive network of sales and research give us the reach and capability to help you optimise capital allocation."

CMS was among the nine Malaysian star caps listed, the others being Berjaya Auto, Bank Islam, Felda Global Ventures, Malayan Banking, Oldtown, Sime Darby, Top glove and Westport Holdings.

Maybank Kim Eng said the Sarawak Corridor of Renewal Energy (SCORE) and the urbanisation of Sarawak will continue to drive construction activities in the state which will benefit CMS as the primary beneficiary of the buoyant construction sector.

It further enthused that CMS has also invested in a ferrosilicon smelter and an integrated phosphate plant located at SCORE's Samalaju Industrial Park. Leveraging on cheap energy in Sarawak, these strategic ventures will support robust earnings expansion.

"With its strong cash hoard and low gearing, CMS has a solid potential war chest of circa RM670 million for more strategic investments to further enhance its recurring income base. CMS is scouting for both greenfield and brownfield investments in related industries.

"CMS's property development division also owns vast property landbank in Sarawak with an estimated gross development value of RM15.5 billion.

"With spill-over effect from SCORE and urbanisation in Sarawak, property could emerge as a major earnings contributor in the long run."

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&#39;Young driven to bankruptcy, 13,872 cases in <b>Sarawak</b> – BorneoPost <b>...</b>

Posted: 30 Mar 2014 02:47 PM PDT

MIRI: A total of 13,872 individuals in Sarawak have been declared bankrupt  by Malaysia's Department of Insolvency (MDI) after failing to settle their car, housing and personal loans.

Minister in the Prime Minister's Department Nancy Shukri disclosed that Kuching recorded the most with 7,112 cases, followed by Miri (4,167) and Sibu (2,593).

"From the cases , most individuals were declared bankrupt after failing to manage their financial commitment including their car loans," said Nancy at the launching of Youth Carnival Fiesta 2014 on Saturday night.

According to Nancy, most individuals lack knowledge and awareness on bankruptcy regulations under the Bankruptcy Act 1967.

"In this context , we have embarked on education and awareness programmes on services available under the department to help them," she said.

Nancy, also the Batang Sadong MP, said the presence of various government agencies and bodies could help youths get the correct information.

"As an example, Advocacy Department and MDI are giving talks to target groups, especially youth, on legal services and causes leading them to be declared as a bankrupt.

Up to January this year, MDI statistics revealed a total of 255,385 bankruptcy cases throughout the country.

The statistics also revealed a big increase in the number of those declared bankrupt since 2007," she added.

In 2012, there was a total of 19,575 cases registered and 130 individuals under age 25 declared bankrupt.

The fi gure increased to 208 in 2013, showing a rising trend of young people in fi nancial fl ight.

Nancy said MDI's data from 2007 to 2014 shows 26 per cent (32,955 individuals) of those declared bankrupt was due to failure in paying car loans, followed by housing loan (17.8 per cent) and personal loan (15.7 per cent).

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Consumer sector likely to face persisting headwinds in 2014 <b>...</b>

Posted: 03 Apr 2014 09:58 AM PDT

KUCHING: Following a string of challenges in 2013, the consumer sector is still likely to face persisting headwinds in 2014 brought on by electricity tariffs, more subsidy challenges, cautious consumer spending habits, and the suspension of Visit Malaysia Year 2014 (VMY2014).

Kenanga Investment Bank Bhd's research team (Kenanga Research) in a report highlighted that consumers have become more selective in their spending habits as income levels struggle to keep up with the escalating cost of living.

For the retail segment, on top of the higher cost of living, increased subsidy rationalisation, and anticipation of goods and services tax (GST) affecting consumers' spending habits, the research team viewed that the sector is also likely to be affected by the likely increase of overnight policy rate (OPR) in the second half of 2014 (2H14) and lower tourist arrivals due to the suspension of Visit Malaysia Year 2014 spurred by the missing MH370.

Similarly, Kenanga Research highlighted that the F&B consumer sector is likely to face a challenging macro backdrop and lack of catalysts.

However, it noted that BR1M will likely neutralise the potential negative impacts of the continued activities in reduction of subsidies that may affect spending power.

The research firm further projected; "We expect a quiet 2Q14 and 3Q14 and believe that 4Q14 will be strongest quarter given the holiday season and also consumer may start loading up goods to 1Q15 before the implementation of GST in Apr 2015, which we believe will boost share prices in 4Q14 and 1Q15 prior the new tax system but with likelihood of correction after that."

It also foresee further potential risks of subsidies cut in fuel, electricity and increase in miscellaneous expenses for Malaysian such as quit rent in certain areas, which will likely dampen the purchasing power further.

"By 2014 year end, we do not rule out the possibility of withdrawal of subsidies on flour and cooking oil in Budget 2015," it said.

As for the F&B sector's sub segments, the research team said that broader concerns remain in the tobacco segment with regards to overall shrinkage of the legal market consumption in contrast to the incidences of illicit trade, which currently stand at an all-time high of 38.9 per cent.

As for the brewery industry, Kenanga Research said that the malt liquor market remained challenging with consumer spending patterns being affected by government subsidy rationalisation, weaker sentiment, in addition to the unfair competition from contraband beers.

Overall, in view of the challenging outlook, the research team opined that investors will become more demanding in terms of yield.

At the same time, it noted that the 10-year Malaysian Government Securities (MGS) has reversed from its low of 3.05 per cent in May 2013 to the current levels of 4.25 per cent (a 14 basis points increase since January) which could affect investors' sentiments.

As such, it recommended consumer stocks with value, which are either able offer above average dividend yields or better earnings growth.

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BMW X5 to conquer M&#39;sian premium SAV segment – BorneoPost <b>...</b>

Posted: 03 Apr 2014 09:46 AM PDT

KUALA LUMPUR: BMW Group Malaysia yesterday introduced the third generation of its leading model in the Premium Sport Activity Vehicle (SAV) segment, the BMW X5.

The model which comes in two variants, the X5 35i and X5 30d, is expected to conquer the SAV market in Malaysia this year.

The BMW X5 has established a new benchmark in the SAV market segment with improved performance and efficiency along with comfort, versatility and luxurious ambience.

"With the new X5 and upcoming new models to be introduced this year, we are positive of achieving double-digit growth this year," BMW Group Malaysia chief executive officer Gerhard Pils said yesterday.

Speaking to reporters at the launch of the new BMW X5 here today, he said the model is also expected to increase market share among German manufacturers of up to 40 per cent in the premium SAV segment.

The BMW X5 35i features two additional third row-seats, full-colour Head-Up Display (HUD), Adaptive Comfort Suspension Package, Dynamic damper control and self-levelling pneumatic rear suspension for supreme comfort.

Both the X5 35i and X5 30d come with a i-drive touch controller, ambient lighting and adaptive LED headlight system for high and low beam as standard with three-different colours to choose from.

The new X5 is available for booking from this weekend across dealerships nationwide.

The estimated retail price on the road without insurance for the BMW X5 35i is at RM598,800 and the X5 30d comes with a RM558,800 price tag. —Bernama

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Sentoria&#39;s growth strategy realisable on past successes <b>...</b>

Posted: 02 Apr 2014 09:07 AM PDT

KUCHING: Sentoria Group Bhd's (Sentoria) ambitious growth strategy to become one of the largest integrated resorts operators in Malaysia has been viewed as realisable particularly given that it has secured two large projects (Bandar Samariang and Morib Bay) which are expected to replicate the success of Bukit Gambang Resort City (BGRC).

According to the research arm of TA Securities Holdings Bhd (TA Securities) in its recent initiation coverage on the group, Sentoria's move towards national expansion of its core property development business together with its leisure and hospitality business is feasible given its landbanking focus which has been on areas that are ideal for the development of integrated resort city.

"In 2013, the group had inked two agreements to expand its geographical reach into two exciting markets; Morib, a popular beach in Selangor; and Kuching, a relatively untapped market," it highlighted.

"A small company with market cap of below RM500 million, the expansion strategy is ambitious but realisable, in our opinion, and by 2025 Sentoria will set to be one of the largest integrated resorts operators in Malaysia.

"We expect Morib Bay and Borneo Samariang to replicate the success of BGRC or could possibly do better than BGRC, owing to its huge target market in the areas with little direct competition.

"To further compound this, the low land costs and investment outlays could help to lift profit higher," it viewed.

Although BGRC serves mainly the local tourists, the research unit noted that it has been demonstrating impressive growth in terms of park attendance and average revenue per visitors.

"As such, we believe that suitable location is important to resort city development.

"Based on population census 2010, we estimate there is a ready catchment of 7.9 million people surrounding Morib Bay, if we take into account population from Kuala Lumpur, Selangor, and Negeri Sembilan, whereas Borneo Samariang should be able to serve the 2.5 million population from Sarawak, or to be specific 620,000 people from Kuching.

"In view of the higher household income level of the catchment surrounding Morib Bay and Borneo Samariang compared to BGRC, we believe the prospect of these two developments is bright," it outlined.

TA Securities explained that while BGRC has received strong supports from the State Secretary of Pahang, Morib Bay and Borneo Samariang should also get a head start given that they are linked to PNB and Cahya Mata Sarawak Bhd (CMS) respectively.

"First, forming a strong tie with government linked companies (GLC) linked companies allows Sentoria to secure lands at a very low entry level," it said.

"For its Borneo Samariang project, the acquisition price of RM30 million for 300-acre development lands in Bandar Samariang, which translates to RM2.30 per square feet is fair, comparing it with RM2.12 per square feet that Hock Seng Lee Bhd paid to acquire 276-acre lands in Bandar Samariang back in 2012.

"Meanwhile, the resort developments land measuring 200 acres were acquired for RM17 million (or RM1.90 per square feet)," the research unit explained.

According to development plans, Phase 1 of Borneo Samariang and Morib Bay comprises mainly affordable homes and resort villas of which TA Securities viewed that Sentoria's the affordability is one of the company's edge over its competitors.

"We estimate these two projects to collectively generate RM150 million to RM200 million of new property sales in FY15 and FY16, with a profit margin of 25 to 30 per cent," it projected, based on maiden launches of its mixed developments in Borneo Samariang and Morib Bay in end FY14 and FY15 respectively.

TA Securities initiated coverage on Sentoria with a 'buy' recommendation and a target price of RM1.20 per share, based on sum-of-parts valuation.

"There could be further upside to realisable net asset value as we have conservatively assumed a 70 per cent take up rate for properties in Morib Bay RC and Borneo Samariang RC," it noted.

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