Friday, June 4, 2010

#Stocks to watch:* Kenmark, AFG, AirAsia, Maxis, Pos

KUALA LUMPUR: With London and Wall Street closed on Monday, May 31, stocks on Bursa Malaysia could see extended buying interest amid some intermittent selling after two days of gains.

Stocks to watch on Tuesday, June 1 include Kenmark Industrial, ALLIANCE FINANCIAL GROUP BHD [] (AFG), AirAsia, Maxis and Pos Malaysia..

Kenmark's share price tumbled on Monday after top officials of a company went missing, leaving suppliers and at least two local financial institutions that had extended loans amounting to at least RM72 million high and dry. The counter resumes trading today.

Alliance Financial Group Bhd (AFG) saw its net profit surge 8,512% to RM77.25 million in its fourth quarter ended March 31, 2010 (4Q2010) from RM897,000 a year ago, despite lower revenue of RM381.56 million versus RM404.37 million.

Its earnings per share rose to 5 sen from 0.1 sen, while net assets per share increased to RM1.90 from RM1.78.

AIRASIA BHD [] posted net profit of RM224.11 million for the first quarter ended March 31, 2010, up 10% from RM203.15 million a year ago. Core operating profit for the period was RM111 million, down 33% decline from 1Q09. The core operating profit margin for the period was at 12.7%, this is lower than the 20.8% core operating profit margin achieved in 1Q09.

However, the stronger ringgit versus the US dollar resulted in a translation gain of RM166 million during the quarter.

THe low cost carrier is reported to be in talks with Airbus to slow down delivery of its A320s. Its chief execuutive officer DAtuk Seri Tony Fernandes said 12 per year would be an ideal nuimber for it to receive. Net gearing was at 2.25 times as at March 31.

AirAsia has so far received 70 of its A320 aircraft on order, with another 105 planes to be delivering up to 2015.

Meanwhile, US-based fund Wellington Management Co, had disposed of 5.3 million AirAsia shares from May 24 to 27. The recent disposals saw its shareholding reduced to 149.47 million shares or 5.42%.

Maxis'' posted net profit of RM552 million for the first quarter ended March 31, 2010 while revenue rose by RM24 million or 1% to RM2.15 billion on the back of higher mobile subscription base.

Mobile subscriptions grew 1.42 million or 13%, which was mainly due to the growth in prepaid of 1.207 million or 14% while postpaid recorded growth of 56,000 or 2% and wireless broadband expanded by 162,000. This brought the total mobile subscription base to 12.691 million as at March 31, it said.

However, Maxis said monthly average revenue per user (ARPU) for prepaid and wireless broadband dropped by RM5 and RM28 respectively, mainly due to erosion in voice yield as a result of migration to lower priced plans and introduction of lower priced tariff packages and promotional packages offering free two-month subscription.

Pos Malaysia's net profit plunged to RM1.63 million in its first quarter from RM22.84 million a year earlier due to the adoption of FRS139 and specifically, the stating of the fair value of its investment in Transmile Group.

Hotel Resort Enterprises Sdn Bhd, a private vehicle linked to Tan Sri Vincent Tan, has ceased to be a substantial shareholder of telecommunications company REDTONE INTERNATIONAL BHD [] and STEMLIFE BHD [].

TANJUNG OFFSHORE BHD [], an integrated service provider for the oil and gas (O&G) industry, is optimistic of clinching a considerable number of contracts from the over 50 local and overseas projects that it is currently bidding for. It is bidding for over RM1 billion of projects bith locally and abroad.

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