#Stocks to watch:* O&G, Kencana, Dialog, Sealink, Supermax, DRB-Hicom

KUALA LUMPUR: Stocks on Bursa Malaysia, especially oil and gas (O&G) counters and related industries are expected to continue see strong trading interest in the week ahead, starting on Monday, May 16.

The interest would be underpinned by Petroliam Nasional Bhd's RM60 billion investments in the refinery and petrochemicals integrated development (RAPID) project in Pengerang, south Johor.

However, overall marketing trading could be slower due to the holiday-shortened week and the cautious overnight close on Wall Street.

US stocks ended a second week of losses on a down note Friday, May 13 reflecting growing worries that stocks are on the precipice of a pullback.

Concern about slowed growth worldwide, the coming end of a supportive Federal Reserve policy and the fear of a worsening euro-zone debt crisis are undermining the stock market's ability to maintain an upward direction.

The Dow Jones industrial average ended down 100.17 points, or 0.79 percent, at 12,595.75. The Standard & Poor's 500 Index finished down 10.88 points, or 0.81 percent, at 1,337.77. The Nasdaq Composite Index'' fell 34.57 points, or 1.21 percent, at 2,828.47.

For the week, the Dow was down 0.3 percent, the S&P 500 was off 0.2 percent and the Nasdaq was barely up at 0.03 percent.

Meanwhile, Petronas' refinery and petrochemicals integrated development (RAPID) project will comprise a crude oil refinery with capacity of 300,000 barrels per day, a naptha cracker that will produce about three million tonnes of ethylene, propylene, C4 and C5 olefins annually, and a petrochemicals and polymer complex that will produce differentiated and highly specialised chemicals. The capacity of the project will be bigger than the current combined production in Kertih and Gebeng.

Stocks in focus would include DIALOG GROUP BHD [] which had received the Johor government's approval to reclaim and use the site in Pengarang for the proposed RM5-billion independent deepwater petroleum terminal. It said the combined investment in the project is estimated at RM5 billion over a seven-year period.

KENCANA PETROLEUM BHD [] is buying Allied Marine & Equipment Sdn Bhd (AME) for RM400 million in its move to become a fully integrated offshore services player.

The company said the purchase of AME would be a share swap, where it would issue 149.25 million new Kencana shares at RM2.68 a share. The vendors of AME are Worldclass Inspiration Sdn Bhd and Allied Asset Holdings Sdn Bhd.

Kencana's total order book increased to RM2.44 billion after it was recently awarded a RM250 million contract from Sarawak Shell Bhd

The Edge weekly reports that offshore vessel builder and charterer SEALINK INTERNATIONAL BHD [] is looking to raise at least RM30 million from a placement exercise as it plans to expand its chartering vessel fleet and increase shipbuilding activities.

Glove maker Supermax Corp Bhd's earnings fell 52.6% to RM24.40 million in the first quarter ended March 31, 2011 from RM51.47 million a year ago as its margins were eroded by high latex prices and the weaker US dollar. Revenue rose 9.4% to RM241.37 million from RM220.65 million a year ago while earnings per share declined to 7.18 sen from 18.97 sen.

DRB-HICOM BHD [] is exploring a potential merger of its 70%-owned Bank Muamalat Malaysia Bhd and Bank Islam Malaysia Bhd but there are no plans to sell its Bank Muamalat stake.

The company submitted a letter of expression of interest to BIMB HOLDINGS BHD [] (BIMB) to explore a potential merger of the two banks and 'has yet to commence any exploratory discussions with BIMB'.

Wall Street's second weekly fall raises fear of retreat

NEW YORK: Stocks ended a second week of losses on a down note Friday, May 13 reflecting growing worries that stocks are on the precipice of a pullback.

Concern about slowed growth worldwide, the coming end of a supportive Federal Reserve policy and the fear of a worsening euro-zone debt crisis are undermining the stock market's ability to maintain an upward direction.

This sentiment was present not just in stocks but also was reflected in a sharp drop in the euro. Stocks and the euro have been trading in a similar pattern for most of the week and particularly on Friday, when a late-morning drop in stocks coincided with a sharp fall in the euro.

Financial stocks took the biggest hit, with the S&P Financial Index .GSPF falling 1.5 percent.

Recent heavy selling in commodities has prompted several money managers to forecast a pullback by stocks, noting that much of the stock market's latest advance has been built on commodity-related stocks.

"I think this is the first thrust in what's likely to be a correction in the stock market," said James Dailey, a portfolio manager at TEAM Asset Strategy Fund in Harrisburg, Pennsylvania.

"But the epicenter of that correction is likely to be in what's already been correcting most severely, which is the commodity-related area."

The Fed's second round of quantitative easing has been credited for much of the strength in stocks and commodities since September 2010. The $600 billion bond-buying program is set to end in June.

"QE2 was perceived to be a big help from a stimulative standpoint, and markets have reacted very favorably to that," said Natalie Trunow, senior vice president and chief investment officer of equities at Calvert Investment Management Inc in Bethesda, Maryland, which manages about $14.8 billion.

"It is also apparent the Fed is unlikely to proceed with QE3, so as QE2 stops that signifies an effective tightening," she said.

The Dow Jones industrial average .DJI ended down 100.17 points, or 0.79 percent, at 12,595.75. The Standard & Poor's 500 Index .SPX finished down 10.88 points, or 0.81 percent, at 1,337.77. The Nasdaq Composite Index .IXIC fell 34.57 points, or 1.21 percent, at 2,828.47.

For the week, the Dow was down 0.3 percent, the S&P 500 was off 0.2 percent and the Nasdaq was barely up at 0.03 percent.

Dailey said because of a weaker outlook for global industrial demand, his firm is lightening up or hedging position in commodity-related areas, including industrial metals.

He sees a stock market correction of between 6 percent and 8 percent from the highs in the Dow and S&P 500.

The CBOE Volatility Index .VIX, used as an indicator of investor fear, ended up 6.5 percent.

In another sign of a shift in sentiment, leadership in the S&P 500 has moved from cyclical sectors like energy and basic materials to sectors with more stable growth like healthcare and utilities.

The S&P energy index .GSPE was down 1.4 percent for the week, and down 8.3 percent for the month to date, while the iShares Silver Trust exchange-traded fund (SLV.P) was down 0.2 percent for the week and 26.7 percent for the month to date.

TECHNOLOGY [] shares were also among the hardest hit in the session. Yahoo Inc (YHOO.O) shares fell 3.6 percent to $16.55 after the Internet company said the Alibaba Group restructured the ownership of Alipay, one of China's largest online payment businesses, without the knowledge of Yahoo and Softbank, two of its stakeholders. - Reuters

Oil rises in late short covering, ends week higher

NEW YORK: Oil rose on Friday, May 13 in late short-covering, ending the week higher after a volatile session whipsawed by European economic concerns and news Libyan leader Libyan leader Muammar Gaddafi may have been wounded.

Trade volumes slowed after a week of heavy activity that saw big swings of more than $11 a barrel between the highs and lows.

Brent crude ended up nearly $5 on the week, after dropping $16 last week as the market digested a wide range of factors fogging the supply and demand outlook, including the death of Osama bin Laden, the impact of high fuel prices, euro zone debt worries and consumer nation monetary policy.

Buyers came in late Friday ahead of the weekend after gains in the dollar sent prices down just before midday in New York.

"Crude prices rose near the close on short-covering ahead of the weekend," said Tom Knight, senior trader of Truman Arnold in Texarkana, Texas.

Brent crude rose 85 cents to settle at $113.83 a barrel after hitting as high as $114.92 earlier. U.S. crude traded up 68 cents to $99.65 a barrel.

Volumes eased compared with the strong trade seen over the last week, but were close to the 30-day moving average near the close.

Oil came under pressure after comments from Italian Foreign Minister Franco Frattini that Gaddafi had likely been wounded and left the capital Tripoli. Libyan state television later carried brief audio remarks in which he taunted NATO and said he was in a place they could not reach.

Conflict in the OPEC nation has slashed exports, helping send prices this year to peaks not seen since 2008. Many experts expect the country's output could be reduced for most of this year.

EARLY STRENGTH

Oil prices got an early boost as strong economic data from Germany and France pushed first-quarter growth in the euro zone well above forecasts, boosting the euro against the dollar.

The dollar rebounded later, as investors refocused on euro zone debt issues ahead of meetings by finance officials in Brussels, helping to lift crude prices.

A meeting of Eurogroup finance ministers, followed by an Ecofin meeting of EU finance ministers on Monday, could provide further direction to the single currency and the euro is likely to remain pressured until at least after investors digest any outcome.

Early support also came from news China will stop exporting diesel to conserve supplies ahead of a looming summer power crunch, signaling the world's top energy user may need net imports to cover surging demand.

Markets were watching rising waters on the Mississippi, where the U.S. Army Corps of Engineers plans to open a spillway to divert floodwaters ways from Louisiana refineries. Operations at Alon's small Krotz Spring, Louisiana refinery will be impacted by the diversion -- which could be done as early as Saturday, however. - Reuters

High Court rules in favour of SC on Ramesh Chelliah's application for judicial review

KUALA LUMPUR: The High Court has ruled in favour of the Securities Commission Malaysia (SC) on Ramesh Chelliah's leave application to commence judicial review for registering PricewaterhouseCoopers (PwC) with the Audit Oversight Board (AOB) on
April 1, 2010.

In a statement Friday, May 13, the SC said that Justice Datuk Rohana Yusuf had on May 12 dismissed Ramesh's application for leave on the grounds that the application was made out of time and the applicant was not an aggrieved person affected by the SC's decision to register PwC and hence did not have locus standi to commence judicial review proceedings against the SC.

All leave applications to commence judicial review proceedings are required to be served on the AG.

Both the AG and the SC argued that there were flaws in the application and raised preliminary objections urging the court to dismiss Ramesh's leave application, said the regulator.

The SC said that in delivering her decision, Rohana agreed with the objections and refused to grant leave to Ramesh.

The High Court also ordered Ramesh to pay costs to the AG and the SC, it said.

On November 2010, Ramesh had filed an application to commence judicial review proceedings against the AOB's''registration of PwC under the Securities Commission Act 1993.

The SC set up AOB in 2010 to register and oversee auditors of all Public Interest Entities (PIEs) which include public listed companies, licensed intermediaries, institutions licensed under the Banking and Financial Institutions Act 1989 and insurance companies under the Insurance Act 1996.

The establishment of AOB is aimed primarily to protect investor interests and promote confidence in the quality and reliability of audited financial statements of PIEs.

Kencana Petroluem in RM400m acquisition of offshore services-based Allied Marine

KUALA LUMPUR: Kencana Petroleum Group Bhd is buying Allied Marine & Equipment Sdn Bhd (AME) for RM400 million in its move to become a fully integrated offshore services player.

The company said on Friday, May 13 the purchase of AME would be a share swap, where it would issue 149.25 million new Kencana shares at RM2.68 a share. The vendors of AME are Worldclass Inspiration Sdn Bhd and Allied Asset Holdings Sdn Bhd.

It said AME provides offshore diving and underwater related services for inspection, repair and maintenance of structures, pipelines and risers and for the CONSTRUCTION [] of underwater facilities for the oil and gas industry.

'The proposed acquisition will also enable Kencana to recognise in full the earnings stream and cash flows that is expected to be generated by AME. The proposed acquisition is expected to expand Kencana's recurring revenues with higher margins being earned.

'There are also potential cost synergies for Kencana with the possibility of AME group providing services to Kencana's in-house subsea services requirements apart from savings on general and administration overheads,' it said.

Kencana said AME has the capability to provide a wide range of sub-sea services for the oil and gas industry. For the past three years, apart from Malaysia, AME had also undertaken various projects for multinational oil and gas players in Indonesia, Vietnam, China and India.

The vendors guaranteed to Kencana Petroleum that AME's audited consolidated profit after tax'' for each of the financial years ending Sept 30, 2011 and Sept 30, 2012 shall not be less than RM40 million.

Ireka unit gets RM109.75m contract to build hotel at KL Sentral

KUALA LUMPUR: IREKA CORPORATION BHD []'s wholly owned unit Ireka Engineering & CONSTRUCTION [] Sdn Bhd has been awarded a RM109.75 million to build a hotel at KL Sentral.

In a statement Friday, May 13, Ireka said its unit had received a letter of award from Excellent Bonanza Sdn Bhd for the contract to build the hotel at Lot G of KL Sentral.

It said the contract involved the construction of a 25-storey hotel tower, inclusive of architecture, structure, mechanical and engineering (M&E) works as well as all external works, with construction duration of 18 months.

Ireka group managing director Lai Siew Wah said this would be the third hotel in the company's construction portfolio, and that it was confident in drawing its experience from the previous two two projects to meet the requirements by international hotel brand.

Ireka constructed the Westin Kuala Lumpur and is currently building the Four Points by Sheraton '' at Sandakan, which is due for completion before the end of this year.

Lai said the company had secured three projects totaling RM370 million over the last few months.

'With the increasing growth momentum in the construction sector, Ireka is hopeful that we will continue to secure more jobs in the coming months,' said Lai.

Among the projects currently under Ireka's belt are the construction of a high-end condominium project, SENI Mont' Kiara, a retail mall and Four Points by Sheraton '' in Sandakan, two office towers at KL Sentral and the Kulai-Second Link Expressway Interchange.

In February this year, its Vietnam-based subsidiary, Ireka Engineering and Construction Vietnam Company Limited, had secured a contract for the structural works package of a general hospital at the International Hi-Tech Healthcare Park in Binh Tan District, Ho Chi Minh City, Vietnam.

Lai said that with the latest job, Ireka's order book now stands at about RM1.14 billion, of which approximately RM513.5 million remain outstanding as at end March 2011.

Supermax 1Q earnings plunge 52% on high latex prices

KUALA LUMPUR: Glove maker Supermax Corp Bhd's earnings fell 52.6% to RM24.40 million in the first quarter ended March 31, 2011 from RM51.47 million a year ago as its margins were eroded by high latex prices and the weaker US dollar.

The company said on Friday, May 13 that revenue rose 9.4% to RM241.37 million from RM220.65 million a year ago while earnings per share declined to 7.18 sen from 18.97 sen.

'While revenue has grown for the current quarter compared to the corresponding quarter last year, profit margins have been eroded mainly due to continuous high latex prices and unfavourable exchange rates,' it said.

Supermax said the average latex price (per kg/wet) had increased by 45.8% to RM10.18 in the 1Q2011 compared with RM6.98 a year ago while the ringgit had strengthened to 3.05 against the US dollar from 3.37.

The company said the continuous rise in latex costs and the weakening of the US dollar were persistent challenges faced by the rubber glove industry.

'Nevertheless, management is taking all possible measures to tackle these headwinds and minimise their effects. Glove prices are raised in tandem with latex price increases and Management has taken steps to adjust glove prices on a more regular basis to pass through the cost increases. Cost-cutting measures are also being put in place,' it said.

However, Supermax said the good news was that since mid-April, 2011, natural rubber latex prices were on the decline from the all time high of RM10.87 per kg wet on April 7, 2011 to RM9.46 per kg wet on May 6, 2011.

On the prospects, it said rubber glove demand is still robust. While demand had normalised to 45 days to 60 days lead times in 3Q 2010, demand has come back strongly and lead times have again stretched to 75 ' 90 days.

It said the buyers had accepted the high latex prices and replenished their stocks. Some buyers, it said, switched their demand from powder free natural rubber (NR) gloves, which are now the most expensive range of gloves, to nitrile gloves which are currently cheaper than even powdered NR gloves.

Supermax explained that traditionally, nitrile gloves were 15% to 20% more expensive than powder-free NR gloves.

On the current operations, Supermax said it had switched more of its production lines to produce nitrile glove up to 33% currently and possibly up to between 40%-45% of total installed capacity.

'This is in line with the growing demand for nitrile gloves from the hospital sector as nitrile glove prices are now lower than natural rubber latex glove prices.

'Should the demand for nitrile gloves continue to rise, the group is well placed to meet the market demands as up to 70% of the group's production lines are built to be inter-switchable between natural rubber and nitrile rubber,' it said.

DRB-Hicom explores merger of Bank Muamalat with Bank Islam, not sale plan

KUALA LUMPUR: DRB-HICOM BHD [] is exploring a potential merger of Bank Muamalat Malaysia Bhd and Bank Islam Malaysia Bhd but there are no plans to sell its shareholding in Bank Muamalat.

The company said on Friday, May 13 it had submitted a letter of expression of interest to BIMB HOLDINGS BHD [] (BIMB) to explore a potential merger of the two banks and 'has yet to commence any exploratory discussions with BIMB'.

DRB-Hicom is the holding company of Bank Muamalat and it holds a 70% stake while Khazanah Nasional Bhd owns the remaining 30%.

'The interest to merge is to add value and enhance the development of Islamic finance in Malaysia which continues to register strong growth over the years,' it said.

DRB-Hicom said the total assets of the overall Islamic banking sector (including development financial institutions) amounted to RM350.8 billion at end-2010, up 15.7% from 2009.

It added the Islamic banking sector (including development financial institutions) now accounted for over 20.8% of the overall banking system in terms of assets, financing and deposits.

'A proposed merger will witness the emergence of a mega Islamic bank and is in line with our government's call to reinforce Malaysia's position as a leading international centre for Islamic finance and to create a home-grown bank,' it said.

April vehicle sales up 4.4% to 50,936 units, production falls 24.6%

KUALA LUMPUR: Vehicle sales rose 4.4% in April to 50,936 units from 48,812 units a year ago but a decline in production by 24.6% to 37,419 units has prompted the Malaysian Automotive Association (MAA) to expect sales volume to slip in May.

It said on May 13, of the 50,936 units sold, 45,335 were passenger vehicles and the remaining 5,601 were commercial vehicles.

'Year-on-year sale volume in April 2011 registered an increase of 4.35% for the second consecutive month despite production slipping by 24.7% against the same month last year,' it said MAA.

On the April sales performance, the MAA said consumer sentiments for new vehicles remained stable. However, it noted there were downward adjustments in production due to the interruption in the supply as some of the original equipment components caused by the earthquake and tsunami in Japan on March 11.

In terms of production, it said there was a sharp decline of 24.6% to 37,419 units in April compared with 49,666 a year ago. Of the 37,419 units, the MAA said 34,198 units were passenger vehicles and 3,221 commercial vehicles.

As for May, it said the sales volume was expected to be lower due to the shortfall in production beginning in April and the 'visibility of the impact of the earthquake and tsunami on supply would continue'.

FBM KLCI crosses 1,540-point level at closing

KUALA LUMPUR: The FBM KLCI closed above the 1.540-point level on Friday, May 13, the first time it surpassed that level since April 11 this year.

At 5pm, the index rose 8.45 point to 1,540.74, boosted by gains especially at banking stocks.

Gainers led losers by 499 to 258, while 303 counters traded unchanged. Volume was 1.18 billion shares valued at RM1.72 billion.

Among the banking stocks, Hong Leong Bank rose 38 sen to RM12.44, HLFG 12 sen to RM11.70, Maybank 11 sen to RM8.85, Public Bank six sen to RM13.12, CIMB five sen to RM8.25 while RHB Capital and AMMB added four sen each to RM9.04 and RM6.38.

Tradewinds rose 73 sen to RM8.81, Tahps added 40 sen to RM5.20, ''PPB 30 sen to RM15.80, Panasonic and Genting added 20 sen each to RM23.30 and RM11.40, TRC Synergy was up 18 sen to RM1.80 and PacificMas added 15 sen to RM4.28.

MPI was the top loser and fell 20 sen to RM5.05; Hap Seng and MISC lost 18 sen each to RM5.45 and RM7.04, Tasek 15 sen to RM8.80, Rapid 13 sen to RM1.48, Genting PLANTATION []s 11 sen to RM8.05, while Sindora, Advanced Packaging and Litrak lost 10 sen each to RM1.70, RM1.28 and RM3.70 respectively.

The actively traded counters included PJI, Karambunai, Axiata, Sinotop. DBE Gurney, Gula Perak, CME and ECM Libra.

At the regional markets, Hong Kong's Hang Seng Index rose 0.88% to 23,276.27, the Shanghai Composite Index added 0.95% to 2,871.03 and Singapore's Straits Times Index jumped 1.06% to 3,163.68.

Meanwhile, Japan's Nikkei 225 fell 0.70% to 9,648.77, Taiwan's Taiex lost 0.30% to 9,006.61 and South Korea's Kospi was down 0.12% to 2,120.08.

PPB rides on Wilmar's improving earnings prospects

KUALA LUMPUR: Shares of PPB GROUP BHD [] rose to a high of RM17 on Friday, May 13 as its major profit contributor, Wilmar was raised to Outperform from Neutral on its improving earnings prospects.

At 3.46pm, PPB was up 32 sen to RM16.98, the strongest gain in recent weeks. There were 211,300 shares done at prices ranging from RM16.54 to RM17.

The FBM KLCI rose 10.72 points to 1,543.01. Turnover was 911.07 million shares valued at RM1.25 billion. There were 433 gainers, 263 losers and 297 stocks unchanged.

Wilmar posted a net profit of US$386.7 million for the quarter ended March 31, 2011. The net profit included the fair value loss on embedded derivatives of its convertible bonds and a profit within the sugar segment relating to pre-acquisition hedging reserves.

'Excluding these exceptional items, the group would have recorded a 3% growth in net profit to US$407.8 million (1Q2010: US$394.2 million),' it said to the exchange. Wilmar said revenue was up 41% to US$9.5 billion for the quarter driven primarily by higher prices of agricultural commodities while bulk sales volume was 14% lower.

CIMB Equities Research upgraded Wilmar to Outperform from Neutral on its improving earnings prospects.

'1Q11 core earnings were broadly in line, at 26% of our FY11 estimate and 25% of consensus. All divisions with the exception of consumer products posted better earnings. We are keeping our earnings forecasts but raise our target price to S$6.20, now based on 16x forward P/E (10% premium to the market) against 14.5x (market P/E) previously in view of its improving earnings prospects.

' The stock has also been upgraded to Outperform on expectations of better earnings in subsequent quarters. Furthermore, it has underperformed the market by 17% since we downgraded it on its 3Q10 earnings disappointment. Potential catalysts are a lifting of price controls in China, potential M&As and better sugar earnings,' it said.

Esso redeems RM300m Islamic debt facility

KUALA LUMPUR: RAM Rating Services Bhd has received confirmation that ESSO MALAYSIA BHD [] fully redeemed and cancelled its RM300 million Islamic debt notes on Monday, May 9.

The ratings agency said on Friday, May 13 the debt notes involved were the commercial papers issuance facility programme (2004/2011).

'As such, RAM Ratings no longer has any rating obligation on the debt facility, which had previously carried a short-term rating of P1.

'Meanwhile, RAM Ratings will maintain surveillance on the preliminary P1 rating of Esso's proposed RM300 million Islamic commercial papers issuance programme (2011/2018),' it said.

Naza Automotive targets RM2.5b in auto exports over 6 years

GURUN: Naza Automotive Manufacturing Sdn Bhd (NAM), the manufacturing arm of the Naza Group of Companies,'' targets to export RM2.5 billion worth of automobiles assembled at its Gurun plant over a six-year period up to 2016.

Its joint group executive chairman, SM Nasarudin SM Nasimuddin said on Friday, May 13 NAM targeted to export 64,000 units assembled at the plant from 2011 to 2016.

These models would include a new C-segment Peugeot sedan codenamed T73 as well as the Peugeot 207 and the Kia Pregio.

NAM started operations in May 2004 and celebrates its seventh anniversary this year.

'In May 2004, NAM commenced operations and began a new chapter for the Naza Group as it marked our entry into the market as a manufacturer. Seven years later, we are poised to become a major exporter of vehicles assembled in Malaysia to markets in the region,' said Nasarudin.

For 2011, Nasarudin said the Naza Group expect to export 2,000 units to regional markets, of which bulk of the exports would comprise of the 207 sedan as well as the Pregio van to Indonesia.

He said vehicles assembled at NAM were exported to Thailand, Indonesia and Brunei and plans were underway to ship them to Australia, New Zealand and other right-hand drive markets in the region.

Nasarudin added NAM would begin exporting specific components for the Forte to Vietnam in the second half of 2011. The Forte is assembled in NAM for the Malaysian market.

Since the plant started in May 2004, the Naza Group has invested RM714 million which includes an assembly plant, two-storey office, a test track, lots for vendors and suppliers and staff accommodation on a 140-acre site.

The first vehicle produced at NAM was a Naza Ria and as of May 2011, over 140,000 vehicles comprising 17 models have been assembled there.

Among the models produced at NAM include the Ria, Citra, Sorento, Spectra, Suria, Bestari, Forza, Sportage, Spectra 5, Optima, Rondo, Pregio, Peugeot 407, Peugeot 308, Picanto, Forte and the Peugeot 207.

At present, the Picanto, Forte, Pregio, Citra, Rondo, Peugeot 407, Peugeot 308 and the Peugeot 207 are assembled at NAM.'' There are plans to assemble the Peugeot 3008, 508 and the new Kia Optima at NAM.

The NAM plant had also spurred economic activities in Gurun and the surrounding areas in Kedah with 219 support service vendors and 64 parts and component vendors providing their components to the plant.

Hap Seng extends losses , discouraged by low placement price

KUALA LUMPUR:'' Shares of HAP SENG CONSOLIDATED BHD [] fell for the second day on Friday, May 13 after it fixed the share placement price at RM5.25 on Thursday.

At 2.59pm, it was down 16 sen to RM5.47 with 2.16 million shares done. On Thursday, it declined 13 sen to RM5.63.

The FBM KLCI rose 7.83 points to 1,540.12. Turnover was 706.92 million shares valued at RM936.67 million. There were 384 gainers, 267 losers and 291 stocks unchanged.

The company fixed the issue price for the placement shares totaling 43.80 million shares at RM5.25, or 9.9% below the five-day volume-weighted average market price up to May 11 of RM5.83.

The company said on Thursday, May 12 the book-building exercise for the proposed placement of 43.80 million shares saw interest exceeded the amount offered. There was interest for about 62 million shares.

The 43.80 million shares represented 7.8% of the paid-up share capital of RM563.52 million shares, excluding 59.138 million treasury shares.

The placement will raise a gross proceeds of RM229.95 million.

MISC near RM7 level on weak 4Q performance

KUALA LUMPUR: Shares of MISC BHD [] fell to a low of RM7.04 on Friday, May 13 after it reported a weaker set of results for the fourth quarter ended March 31, 2011.

At 3.29pm, MISC was down 15 sen to RM7.07 with 870,100 shares done.

The FBM KLCI rose 12.32 points to 1,544.61. Turnover was 828.81 million shares done valued at RM1.14 billion. There were 4213 gainers, 260 losers and 299 stocks unchanged.

On Wednesday, MISC reported net loss of RM307.88 million in the fourth quarter ended March 31, 2011 after it made impairment provisions totaling RM456.65 million.

Tthe poor financial performance was a sharp contrast from the net profit of RM196.43 million a year ago when the provisions for impairments were sharply lower at RM49.58 million.

Revenue fell to RM2.924 billion compared with RM3.31 billion a year ago. Loss per share was 6.9 sen compared with earnings per share of 5.10 sen.

Maybank Investment Bank Research said the core FY11 results were within its expectations as 4Q performance was negatively impacted by lumpy exceptional items resulting in a loss.

'Overall, it is still too early to turn positive on MISC. Operations remain challenging in the petroleum and liner businesses and recovery is unlikely to happen in 2011. Maintain Hold with a RM8.10 target price, based on a 10% discount to SOP valuations,' it said.

Dialog gets Johor nod to reclaim, use Pengarang land for RM5b terminal

KUALA LUMPUR: DIALOG GROUP BHD [] has received the Johor government's approval to reclaim and use the site in Pengarang for the proposed RM5 billion independent deepwater petroleum terminal.

Dialog said on Friday, May 13 its unit Dialog Pengerang Sdn Bhd (DPgSB) had signed a development cum joint venture agreement (DJVA) with the Johor government and the State Secretary, Johor (Inc).

'The DJVA grants the right to start the reclamation work and the use of the reclaimed land for the CONSTRUCTION [] of the independent deepwater petroleum terminal.

'The independent deepwater petroleum terminal will serve as a springboard for other industries to be developed and in line with that the Johor State Government will expand its Master Plan to develop Southeast Johor into a regional oil and gas hub,' said Dialog.

Dialog said the terminal will be developed on contiguous onshore and seabed land located between Tanjung Ayam and Tanjung Kapal, Pengerang, with harbour port, jetty and other marine facilities with water depth up to 26 meters.

It added the terminal would be capable to handling ultra large crude carriers and very large crude carriers and other vessels, and with tankage facilities for the handling, storage, processing and distribution of crude oil, petroleum, petrochemicals and chemical products in Tanjung Ayam and Tanjung Kapal, Pengerang.

Dialog said the combined investment in the project is estimated at RM5 billion over a seven-year period.

The Project is an Entry Point Project under the Malaysian government's National Key Economic Areas and part of the Economic Transformation Programme.

Global silicon wafer shipments dipped in 1Q, says SEMI

KUALA LUMPUR: Worldwide silicon wafer area shipments decreased slightly during the first quarter this year compared to fourth quarter of 2010, according to the Semiconductor Equipment Manufacturers Industry association's (SEMI) quarterly analysis of the silicon wafer industry.

In a statement on its website on May 10, SEMI said total silicon wafer area shipments were 2,287 million square inches during the most recent quarter, a 1% decrease from the 2,302 million square inches shipped during the previous quarter.

New quarterly total area shipments are 3% greater than first quarter 2010 shipments, it said.

The US-based SEMI is the global industry association serving the manufacturing supply chains for the microelectronic, display and photovoltaic industries.

SEMI Silicon Manufacturers Group chairman and Siltronic AG corporate vice president Dr Volker Braetsch said silicon shipments experienced typical seasonal softening during the most recent quarter.

'Given that 2010 was a record year in terms of volume of silicon shipped, it is encouraging to see quarterly shipments were above levels reported the first quarter last year,' said Braetsch.

''

FBM KLCI stays in positive territory at mid-day

KUALA LUMPUR: The FBM KLCI remained in positive territory at the mid-day break on Friday, May 13, lifted by gains mainly at banking stocks.

At 12.30pm, the 30-stock index was up 5.72 points to 1,538.01. Gainers led losers by 341 to 264, while 289 counters traded unchanged. Volume was 613.33 million shares valued at RM705.11 million.

The ringgit weakened 0.08% to 3.0120 per dollar; crude palm oil futures for the third month delivery rose RM22 per tonne to RM3,227, crude oil fell 41 cents per barrel to US$98.56 while gold lost US$1.85 an ounce to US$1,504.05.

Among the major gainers, Hong Leong Bank added 30 sen to RM12.36, Maybank 14 sen to RM8.88, HLFG 10 sen to RM11.68, CIMB nine sen to RM8.29, RHB Capital seven sen to RM8.07 and AMMB added five sen to RM6.39.

Other gainers included Genting and F&N that rose 20 sen each to RM11.40 and RM19, PacificMas 14 sen to RM4.27, TRC Synergy 11 sen to RM1.73 and Shell 10 sen to RM11.

Among the decliners this morning, BAT fell 30 sen to RM48, Panasonic lost 28 sen to RM22.82, MPI 21 sen to RM5.04, Hap Seng 13 sen to RM5.50, MISC 11 sen to RM7.11, while Sindora, Far East and Petronas Dagangan fell 10 sen each to RM1.70, RM7 and RM15.40 respectively.

Meanwhile, the actives included Sinotop, Gula Perak, PJI, DBE Gurney, CME, Etitech and Focus Point

Regional markets were mixed, with Japan's Nikkei 225 down 1.17% to 9,602.48 after comments by the nation's top government spokesman sparked concerns that banks are likely to be asked to ease troubled Tokyo Electric Power Co's loan burden, according to Reuters.

Hong Kong's Hang Seng Index fell 0.44% to 22,972.79, South Korea's Kospi lost 0.80% to 2,105.70 and Taiwan's Taiex shed 0.36% to 9,001.06.

Meanwhile, Singapore's Straits Times Index added 0.29% to 3,139.65 and the Shanghai Composite Index rose 0.06% to 2,845.71.

#Flash* Masterskill files cross appeal, seeks RM100m damages from Sistem Televisyen Malaysia

KUALA LUMPUR: Masterskill Education Group Bhd (MEGB) is filing a cross appeal on the quantum of damages awarded over the visuals of its college on a TV3 news report and is now seeking RM100 million in damages.

MEGB said on Friday, May 13 that Sistem Televisyen Malaysia Bhd (STMB) had appealed against the decision of the High Court on April 28 where MEGB was awarded RM250,000.

'The plaintiff (MEGB) has instructed its solicitors to file a cross appeal on the quantum of damages awarded in order to enhance and increase the quantum to RM100 million,' it said.

To recap, MEGB won its suit against STMB over the visuals of its college on a TV3 news report about 60 colleges which had been deregistered.

On April 28, the High Court founds that MEGB's unit Masterskill (M) Sdn Bhd had successfully proven STMB during the TV3 Buletin Utama defamed Masterskill by''showing visuals of the Masterskill college.

The visuals were shown during the narration that 60 colleges had been deregistered even though this news had nothing to do with Masterskill group.

The High Court then found STMB liable for defamation''and''awarded damages of RM200,000 and costs of RM50,000 to Masterskill.

Kencana orderbook at RM2.44b, gets RM250m contract from Sarawak Shell

KUALA LUMPUR: KENCANA PETROLEUM BHD []'s total order book increased to RM2.44 billion after it was recently awarded a RM250 million contract from Sarawak Shell Bhd.

Bernama reported on Friday, May 13 the latest contract secured by its unit, Kencana HL Sdn Bhd, was to fabricate two gas compression modules for a platform in the West Natuna gas field.

The modules were for the E11P-B Platform, which is one of the platforms in the E11 Hub complex and were scheduled to be delivered and installed in the first quarter of 2012.

Bernama reported the company as saying the deal would increase its total outstanding order book to RM2.44 billion, with Kencana HL contributing RM1.441 billion.

#Update* Petronas to invest US$20b or more in downstream project in south Johor

KUALA LUMPUR: Petroliam Nasional Bhd (Petronas) is currently conducting detailed feasible study on the refinery and petrochemicals integrated development (RAPID) project in Pengerang, south Johor, the national oil company's president Datuk Shamsul Azhar Abbas announced.

'This will be Petronas' largest ever investment in the downstream business. This project will bring Petronas to a different level,' Shamsul said on Friday, May 13.

According to Shamsul, the massive downstream project, which is scheduled to commence operation by 2016, would cost Petronas US$20 billion (RM60 billion) or even more, depending on the final outcome of the feasible studies and the products streams.'' The final investment decision will be made by end-2012.

RAPID project is the national oil company's initiative; the idea was first mooted two years ago. 'This is not part of the Economic Transformation Programme. It is something that is over and above it,' Shamsul explained.

RAPID will comprise a crude oil refinery with capacity of 300,000 barrels per day, a naptha cracker that will produce about three million tonnes of ethylene, propylene, C4 and C5 olefins annually, and a petrochemicals and polymer complex that will produce differentiated and highly specialised chemicals.The capacity of the RAPID will be bigger than the current combined production in Kertih and Gebeng.

Shamsul noted that the project specialised in 'highly specialised chemicals', very few local companies would have that competency. 'We will tie up with the high end partners,' he said, adding that foreign partners might eventually hold equity stake in RAPID.

#Flash* Petronas to build US$20b integrated refinery, petrochemicals complex in Johor

KUALA LUMPUR: Petronas will construct a US$20 billion integrated refinery and petrochemicals complex in Southern Johor to be commissioned by end-2016, Prime Minister Datuk Seri Najib Tun Razak said on'' Friday, May 13.

The project, known as the Refinery and Petrochemicals Integrated Development (RAPID) is at the detailed feasibility study stage and would comprise a crude oil refinery, a naphtha cracker that would produce about three million tonnes of ethylene, propylene, C4 and C5 olefins per year and a petrochemicals and polymer complex that would produce differentiated and highly-specialised chemicals.

"This project is indeed a bold undertaking by Petronas, for I am told, the proposed 300,000 barrels per day crude oil refinery capacity of 300,000 barrels per day proposed under RAPID is larger than the combined capacities of Petronas' existing refineries in Melaka and Kerteh.

"The proposed petrochemical development also exceeds that of Kerteh and Gebeng Integrated Petrochemical Complexes in eastern peninsula Malaysia, combined.

"While RAPID is not one of the entry point projects (EPP) outlined within the ambit of the Economic Transformation Programme (ETP), much of what Petronas is setting out to do is in line with the government's aspirations to turn Malaysia into a leading petroleum industry hub in the region," Najib added.

Najib said the projects presented Malaysia with a major vehicle by which to attract foreign direct investments into the country, bolster private
investment and expand the country's access to world-class technologies.

He said the project would not only facilitate upgrading of the country's industrial capabilities into higher value-added activities, but, also enable the
capture of a larger portion of the product value-creation in Malaysia to count towards and bolster the country's Gross National Income (GNI).

"Furthermore, with up to 4,0000 employment opportunities of highly-skilled workers potentially created in the oil and gas sector, I am confident project RAPID will also provide avenue for a new generation of technical professionals to develop their skills and capabilities." he said.


The employment opportunities created during the CONSTRUCTION [] phase of the project would of course be much larger than the estimated 20,000 jobs and not to mention the many other spin-offs that would be created in related sectors of the economy, he added.

In addition to the project RAPID, Najib said Petronas would also be assessing the feasibility of an Liquefied Natural Gas Receiving and'''''' ''
Re-Gasification Terminal, aimed at completing the energy needs of the project.

"Should the proposition prove feasible, this will be the second such terminal in the country, in addition to the one already committed to in the
state of Melaka, which will further enhance the security of gas supplies in Peninsular Malaysia," he said. - Bernama

Banks, blue chips prop FBM KLCI up

KUALA LUMPUR: The FBM KLCI rebounded firmly on Friday, May 13 and was up at mid-morning, lifted by gains at banking stocks and key blue chips.

The 30-stock index rose 6.09 points to 1,538.38 at 10am.

Gainers led losers by 221 to 142, while 209 counters traded unchanged. Volume was 193.58 million shares valued at RM185.19 million.

Maybank Investment Bank Bhd head of retail research and chief chartist Lee Cheng Hooi in a note to clients May 13 said that due to rebound tone on Wall Street yesterday, the FBM KLCI could be in a steady price action mode today.

'We expect the FBM KLCI to move up first, but pre-weekend profit-taking activity might emerge later to curtail the market's rise.

'Week-on-week, the index is likely to close positively,' he said.

Among the gainers, Hong Leong Bank was up 38 sen to RM12.44, HLFG 26 sen to RM11.84, Maybank 13 sen to RM8.87 and CIMB 10 sen to RM8.30.

Genting added 22 sen to RM11.42, PacificMas 13 sen to RM4.26, TRC Synergy 12 sen to RM1.74, Sarawak Oil Palms 11 sen to RM3.59 and Petronas Dagangan 10 sen to RM15.60.

Gula Perak was the most actively traded counter with 11.5 million shares done. The stock fell half a sen to 1 sen.

Other actives included Etitech, Karambunai, Tricubes, Perisai, CME and Digistar.

Decliners at mid-morning included Nestle, BAT, Malayan Flour, Genting PLANTATION []s, DiGi, Hap Seng, Sindora, Far East, Batu Kawan and Ajinomoto.

At the regional markets, the Shanghai Composite Index added 0.30% to 2,852.71 and Singapore's Straits Times Index gained 0.40% to 3,142.87.

Japan's Nikkei 225 fell 0.24% to 9,693.26, Hong Kong's Hang Seng Index lost 0.32% to 23,000.53, South Korea's Kospi was down 0.63% to 2,109.18 and Taiwan's Taiex shed 0.03% to 9,030.69.

Media Prima down at mid-morning

KUALA LUMPUR: Shares of MEDIA PRIMA BHD [] declined at mid-morning on Friday, May 13 after its net profit for the first quarter ended March 31, 2011 fell 23.7% to RM34.79 million from RM45.57 million a year ago, in line with general seasonal advertising trends.

At 10.30am, Media Prima shed two sen to RM2.66 with 258,800 shares done.

Revenue for the quarter rose to RM354.19 million from RM323.67 million in 2010. Earnings per share werea 3.36 sen while net assets per share was RM1.27.

Reviewing its performance, Media Prima said on Thursday, May 12 that the first quarter of the year had always been the lowest in terms of advertising spending as compared to other quarters, when most advertisers start their promotional roll out.

MIDF Research has downgraded Media Prima to Neutral with a lower target price of RM2.70 (from RM2.80).

'We are maintaining our FY11 and FY12 top line estimates. However, to reflect the lower negative''goodwill, we are revising downwards our FY11 and FY12 net profit estimates by 26.6% and 20.0%.

'Although, we believe Media Prima will register growth operationally, we are downgrading''Media Prima to Neutral due to the recent run up of its share price. Our adjusted target price is based on PE/Growth ratio of 0.85 times, based on average PEG of its regional peers,' said MIDF Research in a note May 13.

''

CIMB Research has a Buy on Naim Holdings at RM2.73

KUALA LUMPUR: CIMB Equities Research has a Buy on Naim Holdings at RM2.73 at which it is trading at a price-to-book value of 0.9 times.

It said on Friday, May 13 Naim is trapped in a downtrend channel. Yet, this correction phase is probably at its tail end. A temporary low may have formed at the RM2.58 level, which will likely be its base for weeks ahead.

'If we are right, the stock is poised for stronger rebound. Immediate resistance is at RM2.89, followed by RM3.08 and RM3.24 next. Traders may start to nibble now to ride on this recovery wave. However, be quick to cut loss if RM2.58 is violated.

'Technical landscape is improving. MACD has staged a positive crossover while RSI too has hooked upward,' it said.

Genting advances in early trade

KUALA LUMPUR: GENTING BHD [] shares advanced in early on Friday, May 13 on the back of its 52%-owned Genting Singapore reporting positive 1Q2011 results.

At 9.10am, Genting was up 18c to RM11.38 with 216,200 shares traded.

Maybank Investment Bank Bhd Research said Genting Singapore's results exceeded expectations (house and street) on above theoretical VIP win rate of 3.8%.

'Genting Singapore should continue to take the lion's share of VIP volume thanks to its generous credit policy,' it said.

The research house maintained its buy recommendation with raised target price of RM12.76 (from RM12.58).

Sarawak Oil Palms rises on positive 1Q results

KUALA LUMPUR: SARAWAK OIL PALMS BHD [] (SOP) shares rose on Friday, May 13 after it earnings jumped 134% to RM55.54 million in the first quarter ended March 31, 2011 from RM23.67 million a year ago as it benefited mainly from higher crude palm oil (CPO) and palm kernel (PK) prices.

At 9.15am, SOP was up 16 sen to RM3.64 with 15,500 shares traded.

It said on Thursday, May 12 revenue increased by 64.3% to RM238.48 million from RM145.10 million. Earnings per share were 12.84 sen versus 5.52 sen.

'The increase of RM93.4 million in revenue was mainly attributed to the higher average CPO and PK prices realised and sales volume during the period,' it said.

On the outlook, it said the performance of the group was largely dependent on developments in the world edible oil market, bio-diesel market, fossil oil market, movement of ringgit, world economic situation and their corresponding effect on CPO prices.

MIDF Research maintained its buy call on SOP with a revised target price of RM4.45 (from RM4.07).

'We revised our target price to RM4.45 (from RM4.07), based on 11.3 times EPS11, which is one standard deviation above its 5-year historical PE of 8.9 times.

'SOP is currently trading at 8.8x forward PE, which is a 23% discount to the weighted average market PE of 11.5 times,' MIDF Research said in a note May 13.

Maybank gains on 3Q results, outlook

KUALA'' LUMPUR: MALAYAN BANKING BHD [] shares advanced on Friday, May 13 after the bank said it ''expects earnings for FY11 ending June 30 to surpass the record net profit it achieved in FY10.

Maybank's net profit for 3QFY11 rose 11%''to RM1.14 billion from RM1.03 billion.

At 9.35am, Maybank was up 16 sen to RM8.90 with 329,700 shares traded.

Maybank's revenue for the three months in review was 11.8% higher at RM5.13 billion compared with RM4.6 billion a year ago.

Maybank said on Thursday, May 12 that the results were boosted by strong loans growth, increased revenues across almost all business segments of the group and significantly lower allowance for losses on loans which declined by almost half.

OSK Research in a note May 13 maintained its buy call on Maybank with a target price of RM10.07.

'Its previously conservative provisioning coupled with continued improvement in asset quality are beginning to bear fruit, with loan loss provisions declining 49.8% q-o-q.

'The combination of continued improvement in domestic asset quality, loans growth traction and benefits from the rising interest rate environment will boost the group's earnings momentum in FY12,' said OSK Research.

BIMB gets offer notice for Bank Muamalat

KUALA LUMPUR: Malaysia's BIMB Holdings has received notice from sovereign wealth fund Khazanah Nasional Bhd and conglomerate DRB-Hicom of their intention to sell Bank Muamalat to the company, state news agency Bernama reported on Friday, May 13.

A newspaper report citing unnamed sources had said in April that Khazanah Nasional would start talks to sell its 30 percent stake in Bank Muamalat to Islamic financial group BIMB Holdings. [ID:nL3E7FL03G]

Financial-to-autos group DRB-Hicom owns the remaining 70 percent in Bank Muamalat.

"They want to sell and have identified us as a potential buyer," BIMB chief executive officer Johan Abdullah was quoted as saying by Bernama.

He said the matter would be discussed at a board meeting on May 25 and if the board was in favour of the acquisition, BIMB would seek the central bank's approval to start negotiations. - Reuters

ANALYSIS-Time to move some money to stocks from commodities

NEW YORK: Commodities have lost their luster for leading investment strategists on fears that global economic growth, particularly Chinese demand, may be lower than previously expected, Reuters reports on Thursday, May 12.

Instead, they are recommending investing in large-cap U.S. companies whose earnings have historically varied less through economic cycles. That includes defensive areas such as household products and utilities but also some TECHNOLOGY [] and industrial companies.

Investors became more cautious about commodities after last week's vicious unwind of oil, copper and precious metals -- which some dubbed a mini "flash crash" similar to the one seen in U.S. equity markets a year earlier.

Even as strategists recommend steering away from commodities, they agree that the long-term outlook is positive. But over the near term they do not rule out another downleg in prices -- especially if China, the world's largest consumer of raw materials, continues to tighten monetary policy.

"Chinese policy makers made it very clear that there is 'no absolute limit' to what they will do to control inflation, which raised concerns around the impact of their actions on demand growth" for commodities, Jan Loeys, head of asset allocation at JPMorgan, wrote in a research note this week.

Economic activity has been moderating in China, and prospects for future growth seem less certain after the government signaled no end in its fight to curb inflation.

China raised bank reserve requirements by 50 basis points on Thursday, surprising analysts who had expected it to use monetary brakes less aggressively after a series of weaker-than-expected economic data for April.

For its part, the United States saw growth domestic product of only 1.8 percent in the first quarter, down from 3.1 percent in the last three months of 2010.

Last week's sell-off drove the price of U.S. crude oil below $100 from an April peak of more than $113. Prices have been volatile since then, and further weakness is possible.

"What happened in commodity markets last week was not surprising at all, and more weakness in the near term wouldn't be that surprising either," Jim O'Neill, chairman of Goldman Sachs Asset Management, said in a recent research note.

U.S. A BRIGHT SPOT FOR NOW

As commodities lose appeal, the outlook for U.S. stocks remains bright in the short term -- at least as long as the U.S. Federal Reserve continues to provide easy money with its quantitative easing policy.

Merrill Lynch argues that the three main drivers of stocks performance -- investor positioning, monetary policy and company profits -- remain in place, albeit less so than two years ago.

"While we would wait for a better entry point, we believe the cyclical bull market in equities is not over and would buy any summer weakness in stocks, Michael Hartnett, Merrill Lynch's chief global equity strategist, wrote in a report, in which he favors U.S. and emerging markets over Europe and Japan.

Defensive stocks are preferred to cyclical ones, JP Morgan said, arguing that the economic indicators show the global manufacturing sector is experiencing an inventory correction similar to the one seen around the middle of last year.

Defensive stocks are not the only ones that should perform well this year, according to Merrill Lynch. Companies with strong and stable profit growth are also expected to thrive as corporate earnings decelerate in general and the Federal Reserve prepares to reduce monetary stimulus, it said.

"The list of stocks (with the lowest earnings variability) comprises a surprisingly diverse group, with almost equal representation from cyclical sectors as well as defensive sectors," Savita Subramanian, Merrill Lynch's quantitative analyst, said in a research note,

Technology stocks, Subramanian added, are well represented in that list.

Other strategists favored U.S. equities over commodities-rich emerging markets because of the opposite impact of lower energy prices.

"Lower energy prices are positive for the U.S. as it allows consumer demand to sustain itself and thereby the economic recovery," said Alberto Bernal, head of research at BullTick Capital Markets.

"A correction in commodities, however, is negative for the emerging markets exporters, consistent with our call for overweight U.S. and developed market equities versus those of emerging markets this year."

COMMODITIES IN FAVOR LONG TERM

But even as worries about demand from China cloud the near-term picture for commodities, views on the global economy lend support for longer term gains.

Bank of America Merrill Lynch economists forecast the global economy to expand 4.2 percent this year, led by strong 6.5 percent growth in emerging markets. In the United States, they expect corporate spending to accelerate throughout the year and help the economy grow about 2.5 percent in 2011.

The outlook for strong growth in emerging markets and a recovery in the developed world should translate into long-term gains in commodity prices, with rises seen beginning later this year, according to strategists.

The conflicting near-term and longer term outlooks is driving caution for now.

"We expect higher prices from here but we wait for more clarity on the impact of the economic soft patch on final demand before going long," JPMorgan said, adding that the recent rout in commodities may have no significance.

"Our reading is that the outlook for commodities may be as little affected by this flash crash as was the outlook for the equities markets after the events in May of 2010," said Kevin Gardiner, head of investment strategy at Barclays Wealth.

While last year's flash crash hammered the Dow Jones industrial by as much as 9.2 percent in its worst moment, the index quickly regained those losses and has since climbed more than 20 percent.

Barclays Wealth is advising its affluent clients to go neutral on commodities, as they look "very expensive" at the moment despite recent falls.

Prices are unlikely to go much higher, Gardiner says, but "simply keeping pace with inflation over the next year or two will make them a better investment than bonds." - Reuters

HSBC plans to hire over 1,000 staff over 5 yrs in Singapore

SINGAPORE: HSBC plans to hire more than 1,000 staff in Singapore over the next five years to help it double its profit before tax from the city-state, the bank's Singapore CEO said in remarks published on Friday, May 13.

Alex Hungate, HSBC Singapore CEO, was quoted by the Business Times newspaper as saying he wants the Singapore unit to earn a pre-tax profit of $1 billion in five years, doubling from $524 million in 2010.

"Singapore has an important role to play in the group's strategy going forward," said Hungate in an interview.

"We have three things to focus in Singapore - trade, financial markets and wealth management."

HSBC, Europe's largest bank, has targeted India, Singapore and Malaysia/Indonesia to each deliver over $1 billion in profit before tax in the medium term, joining Hong Kong and mainland China as 'billion-dollar' businesses, the paper said.

Currently HSBC has 3,500 staff in Singapore.

The hiring plan comes after the bank's CEO Stuart Gulliver announced on Wednesday that the bank is to cut back in retail banking and may sell its U.S. credit card arm in a bid to cut $3.5 billion in costs and revive flagging profits.

Europe's biggest bank faces an urgent need for action as more than two-fifths of its businesses are not delivering their cost of capital, Gulliver said. - Reuters

PPB in focus after Wilmar posts smaller 1Q earnings

KUALA LUMPUR: Shares of PPB GROUP BHD [] may see trading interest on Friday, May 13 could see trading interest after the major contributor to its earnings, Wilmar International Ltd posted a smaller-than-expected fall in first-quarter net profit.

Wilmar posted a net profit of US$386.7 million for the quarter ended March 31, 2011.

It announced to the Singapore Exchange the net profit included the fair value loss on embedded derivatives of its convertible bonds and a profit within the sugar segment relating to pre-acquisition hedging reserves.

'Excluding these exceptional items, the group would have recorded a 3% growth in net profit to US$407.8 million (1Q2010: US$394.2 million),' it said to the exchange.

Wilmar said revenue was up 41% to US$9.5 billion for the quarter driven primarily by higher prices of agricultural commodities while bulk sales volume was 14% lower.

Its chairman and CEO, Kuok Khoon Hong said: 'The group remains positive on its prospects, despite a challenging operating environment in China arising from the monetary tightening and anti-inflationary measures implemented by the Chinese government.

'Asian economies will continue to see strong growth and the strength of

Wilmar's integrated business model will continue to enable the Group to benefit from this growth. '

Reuters reports that Wilmar's net profit hit by weakness in consumer products segment, derivative losses and loss from its new sugar milling business.

The firm, which generated more than half of its revenue from China, has been hit by government price control on vegetable oils as Beijing try to rein in food inflation.

''

Wall Street ends up, helped by defensive shares

NEW YORK: Defensive shares led a rebound in stocks on Thursday, May 12 as investors weighed mixed economic signals and recent volatility in commodities as they searched for direction.

The Dow industrials fell nearly 100 points in the morning but recovered later after a lackluster auction of 30-year U.S. bonds and headlines suggesting negotiations to raise the U.S. debt ceiling had intensified.

The strong performance by defensive shares, such as health care and consumer staples, suggested investors were still attracted to stocks while other asset classes made them more nervous.

"Fixed income investments don't seem very attractive at the current yield. There's some concern about commodities. The volatility has scared a lot of people away, so I think a lot of investors are sitting back and saying, 'Where can I put my money?' and the stock market is that," said Channing Smith, co-manager of the Capital Advisors Growth Fund in Tulsa, Oklahoma.

The Dow Jones industrial average .DJI was up 65.89 points, or 0.52 percent, at 12,695.92. The Standard & Poor's 500 Index .SPX was up 6.57 points, or 0.49 percent, at 1,348.65. The Nasdaq Composite Index .IXIC was up 17.98 points, or 0.63 percent, at 2,863.04.

YIELDS UNATTRACTIVE

Bond yields have been declining, making them less attractive compared with stocks, particularly those that pay dividends such as utilities. The S&P utility index .GSPU rose 0.9 percent on Thursday and has gained 5.8 percent since April 8 when the recent decline in bond yields began.

Commodities have been under pressure in recent sessions, although oil ended the day higher.

Defensive stocks typically have more predictable revenues, which makes them attractive during volatile markets.

The iShares Silver Trust exchange-traded fund (SLV.P) took in $311.5 million of new money in the week ended Wednesday, data from Lipper showed. That followed record redemptions of $1.01 billion the previous week.

Total assets in the fund fell, however, to $13.25 billion from $13.30 billion as the week's net inflows were more than offset by $368.9 million in declines due to market performance.

The silver ETF has been among the biggest stock market losers in the recent commodities rout. The ETF fell 3.1 percent on Thursday and 29 percent since the start of the month.

DEFENSIVE SHARES GAIN

S&P consumer staples .GSPS rose 1.3 percent, while the S&P health care index .GSPA gained 0.9 percent. Many defensive shares have been on an upward trajectory since about mid-March.

Shares of Merck & Co (MRK.N) rose 1.6 percent to $37.20, while Tyson Foods (TSN.N) advanced 4.6 percent to $18.84.

The market ended down on Wednesday after another sell-off in commodities.

U.S. data showed the economy struggling to gain traction. Jobless benefit claims declined last week but retail sales posted their smallest rise in nine months in April.

Financial shares fell after Rochdale Securities banking analyst Dick Bove put a "sell" rating on Goldman Sachs Group (GS.N) and reduced the price target on the stock to $120 from $163, citing litigation worries.

Goldman shares slumped 3.5 percent to $142.75 and volume topped the 50-day moving average. The KBW bank index .BKX was down 0.2 percent.

Cisco Systems Inc (CSCO.O) warned late Wednesday it would fare worse this quarter than Wall Street had forecast. The tech company laid out plans for global job cuts as it struggles to revive growth. Its shares fell 4.8 percent to $16.93.

After the closing bell, shares of Nordstrom (JWN.N) declined 3.9 percent to $47.26 after the upscale retailer posted results and cuts its full-year earnings outlook. - Reuters

#Stocks to watch:* Dialog, Maybank, Fitters, Media Prima

KUALA LUMPUR: Stocks which could see strong trading interest on Friday, May 13 include DIALOG GROUP BHD [], MALAYAN BANKING BHD [], FITTERS DIVERSIFIED BHD [] and MEDIA PRIMA BHD [].

Petroliam Nasional Bhd is reported to be investing up to RM50 billion in new integrated downstream project to expand its business and further spur the growth of Malaysia's oil and gas downstream sector. This will be the single largest investment in the country in a project.

The signing ceremony will be on Friday in the presence of Prime Minister Datuk Seri Najib Tun Razak.

Then project would likely be the independent deepwater petroleum terminal project at Pengerang, Johor which is jointly undertaken by Dialog and Vopak.

To recap, Dialog and Vopak's combined investment in the terminal would be RM5 billion and over a seven year period. Dialog's investment would be RM2.5b of which 30% would be from equity and 70% from project financing.

Dialog and Vopak are the core facilitators for the project, which is viewed as an entry point project (EPP) under the government's Economic Transformation Policy (ETP).

Maybank expects earnings for FY11 ending June 30 to surpass the record net profit it achieved in FY10.

Maybank's net profit for 3QFY11 rose 11%''to RM1.14 billion from RM1.03 billion. Revenue for the three months in review was 11.8% higher at RM5.13 billion compared with RM4.6 billion a year ago.

Fitters' earnings rose 107% to RM5.73 million from RM2.56 million a year ago, boosted by its new palm oil extraction business. Revenue was RM102.74 million, up 193% from RM35.03 million. Earnings per share were 2.65 sen versus 1.29 sen.

Media Prima's net profit for the first quarter ended March 31, 2011 fell 23.7% to RM34.79 million from RM45.57 million a year ago, in line with general seasonal advertising trends.

Revenue for the quarter rose to RM354.19 million from RM323.67 million in 2010. Earnings per share werea 3.36 sen while net assets per share was RM1.27.

Reviewing its performance, Media Prima said on Thursday, May 12 that the first quarter of the year had always been the lowest in terms of advertising spending as compared to other quarters, when most advertisers start their promotional roll out.

Fitters Diversified 1Q earnings double to RM5.73m

KUALA LUMPUR: FITTERS DIVERSIFIED BHD []'s earnings rose 107% to RM5.73 million from RM2.56 million a year ago, boosted by its new palm oil extraction business.

It said on Thursday, May 12 revenue was RM102.74 million, up 193% from RM35.03 million. Earnings per share were 2.65 sen versus 1.29 sen.

Commenting on the revenue, it said the better performance was due to an increase of revenue from both manufacturing, trading division and CONSTRUCTION [], engineering and property division of the group on top of revenue generated from the new palm oil extraction business.

'The overall group profit before taxation increased by 145.2% to RM8.26 million from RM3.368 million. The increased in profit was due to the increased in the performance of the above mentioned division and the new palm oil business,' it said.

Commodities lead stocks down

NEW YORK: Stocks nearly erased a three-day rally on Wednesday, May 11 as energy and other commodity shares sank, feeding worries about the market's ability to stay on its upward path.

The second major breakdown in commodities in a week fueled selling in other risky assets, including stocks. A stronger dollar and data showing a rise in U.S. fuel supplies sent crude oil prices down more than 5 percent, and the S&P energy index .GSPE slid 3 percent.

"A lot of money is tied up into things like exchange-traded funds and mutual funds that track a broad array of stocks and not just commodities. Some of this could be a shift out of equities in general, but especially energy and commodities," said Bryant Evans, investment adviser and portfolio manager at Cozad Asset Management in Champaign, Illinois.

About five stocks fell for every one that rose on the New York Stock Exchange, a broad exodus signaling investors saw little value in most industries.

The Energy Select Sector SPDR Fund (XLE.P) fell 2.9 percent to $74.28 while the U.S. oil fund (USO.P) lost 4.2 percent to $39.35 and the iShares silver exchange-traded fund (SLV.P) dropped 8.3 percent at $34.39.

Worries about global demand have fed losses in energy and materials shares. The S&P energy sector is now down 7.8 percent since the start of the month.

In a sign of weakness, the S&P 500 broke below 1,340, a key technical level, and some analysts said a close below 1,330 would be bearish for the market.

The Dow Jones industrial average .DJI was down 130.33 points, or 1.02 percent, at 12,630.03. The Standard & Poor's 500 Index .SPX was down 15.08 points, or 1.11 percent, at 1,342.08. The Nasdaq Composite Index .IXIC was down 26.83 points, or 0.93 percent, at 2,845.06.

The 1,340 level roughly coincides with the 20-day average, which the market has closed above since April 20. If the S&P 500 closes below that average, the Bollinger bands chart shows a near-term target just above 1,300.

The S&P 500 index is still up 27.9 percent since the start of September, roughly when the market's recent rally began.

After the market's close, shares of Cisco (CSCO.O) dipped 2.1 percent to $17.40 as the company reported results and warned of another weak quarter.

In the foreign exchange market, the euro dropped to a three-week low against the dollar as investors unwound risky trades in commodities and higher-yielding currencies and bought back the greenback in a flight to quality bid.

U.S. government debt prices also rose in a safety bid.

Concerns about growth in China also hit cyclical sectors. A report showed industrial output growth eased in April, suggesting China's economy was moderating the pace of expansion, although Chinese inflation remained high.

To be sure, many strategists saw the commodity declines as a long-term positive for the market, giving some relief from higher commodity costs to consumers and companies.

That was evident in some gains in the consumer discretionary sector, said Carter Worth, chief market technician, Oppenheimer & Co in New York.

"The breaking in fever of commodities ultimately is a positive," he said.

The S&P retail index .RLX ended the day up 0.06 percent. Shares of Macy's Inc (M.N) jumped 7.7 percent to $28.36. The department store reported a profit that topped estimates and offered an optimistic outlook for the rest of 2011. - Reuters

MBSB posts net profit of RM68.28m in 1Q

KUALA LUMPUR: MALAYSIA BUILDING SOCIETY BHD [] (MBSB) posted net profit of RM68.28 million in the first quarter ended March 31, 2011 compared with RM43.19 million a year ago.

It said on Wednesday, May 11 that revenue was RM311.63 million compared with RM169.12 million.

'For the three months ended March 31, 2011, MBSB group achieved a pre-tax profit of RM91.0 million, an increase of 111% as compared to the pre-tax profit of RM43.2 million for the corresponding period in 2010.'' This contributed to improved net earnings per share of 9.75 sen and annualised return on equity of 66%,' it said.

On quarterly basis, MBSB recorded a pre-tax profit of RM91.0 million for 1QFY11 compared to 4QFY10 pre-tax profit of RM72.4 million.

'The higher pre-tax profit is mainly due to higher income from Islamic banking operations in the current quarter,' said its chief executive officer Datuk Ahmad Zaini Othman.

'The strong earnings are the result of the company's continued efforts in executing its Business Plan, to increase its loans in the retail segment. This customer segment includes government servants who continue to benefit from very affordable financing and attractive packages offered,' he said.

As at March 31, 2011, net loan, advances and financing stood at RM12.1 billion, up 13% from RM10.7 billion as at Dec 31, 2010.

MISC swings into losses of RM307m in 4Q

KUALA LUMPUR: MISC BHD [] posted net loss of RM307.88 million in the fourth quarter ended March 31, 2011 after it made impairment provisions totaling RM456.65 million.

In its financial statements issued on Wednesday, May 11, the poor financial performance was a sharp contrast from the net profit of RM196.43 million a year ago when the provisions for impairments were sharply lower at RM49.58 million.

MISC said its revenue was lower at RM2.924 billion compared with RM3.31 billion a year ago. Loss per share was 6.9 sen compared with earnings per share of 5.10 sen.

For the financial year ended March 31, 2011 however it reported higher net profit of RM1.87 billion compared with earnings of RM682.04 million in FY10.

Revenue slipped 10.5% to RM12.32 billion from RM13.77 billion mainly attributed to lower revenue from liner and heavy engineering businesses.

MISC said the group's profit before tax (excluding gains and impairment provisions for ships, loans and investments) for the full financial year of RM1.321 billion was 34.5% higher than the profit before tax of RM982.7 million in FY2010 largely due to lower losses in liner business and higher contributions from offshore and heavy engineering segments.

Its cash and cash equivalents shrank to RM3.352 billion from RM7.849 billion a year ago.

On the prospects, MISC said within the energy related shipping segments, the LNG business continues to provide stability to the group via its stream of secured and recurring earnings through its portfolio of long term contracts.

'However, we expect the market to be challenging for the petroleum and chemical tanker businesses due to a prolonged overcapacity in the industry,' it said.

Petra Perdana gets RM73m worth of charter contracts

KUALA LUMPUR: PETRA PERDANA BHD [] has secured a total of RM73 million worth of new charter contracts for three mid-size anchor handling tug supply (AHTS) vessels.

Petra Perdana said that in the first contract, a 12,000 BHP AHTS was on a six-month charter from May 1 for deployment in Labuan, while in the second contract another 12,000 BHP AHTS was an 18-month charter from May 7 to work from its Kemaman base.

Each of the charters can be extended for a period of up to two months, it said.

Petra Perdana said it had also secured a one-year charter renewal for a 10,800 BHP AHTS vessel that was currently supporting Petronas Carigali operations.

The new contract is effective from June 23, 2011, it said.

In a statement Wednesday, May 11, Petra Perdana managing director Shamsul Saad said the company had received many charter enquiries over the last two months.

'The new charters are a confirmation the demand recovery is well in progress, especially in our segment of medium-size AHTS.

'The utilisation rate of our newbuilds has been improving, albeit gradually, to more than 80% now from less than 60% at the beginning of the year,' he said.

Shamsul said that at the core of Petra Perdana's offshore support fleet were the 10,000-12,000 BHP AHTS that were capable of operating in the deeper waters of the region and work boats and word barges that can accommodate up to 300 workers at a time.

The company's current fleet includes 16 newbuilds from its fleet renewal programme that began in 2007 and due for completion in the third quarter with the arrival of a work barge, he said.

Last year the company took delivery of seven vessels, the most in a year, amid an unprecedented downturn in the upstream sector of the oil and gas industry, he said.

The cost of fitting out and mobilising the vessels, despite a total absence of new charter demand, took a heavy toll on the company's cash flow and bottom line, he said.

'We really felt the financial strain.

'Now that the utilisation rate is improving and without those one-off fit-out and mobilisation costs, we are rather upbeat about our ability to turn around this year,' he said.

S&P sees HL Bank-EON Cap integration process facing some execution risks

KUALA LUMPUR: Standard & Poor's Ratings Services says the integration process of HONG LEONG BANK BHD [] with EON CAPITAL BHD [] faces some execution risks.

The rating agency's credit analyst Ivan Tan said on Wednesday, May 11 the concern was the 'historically defensive nature of HL Bank's strategy, and its lack of a track record in mergers and acquisitions'.

"A successful execution will allow the combined entity to leverage on its enlarged domestic footprint to grow its market share and compete more effectively with its larger peers,' he said.

Standard & Poor's had affirmed its unsolicited long-term and short-term counterparty credit ratings on HL Bank at 'BBB+' and 'A-2', respectively. The outlook is stable.

It also affirmed the unsolicited 'C+' bank fundamental strength rating on HLBB, and the unsolicited 'BBB' issue rating on the subordinated notes issued by the bank.

"The rating affirmation reflects our opinion that the financial profile of HL Bank has deteriorated following its acquisition of the financially weaker EON Capital," said Tan.

"We lowered the stand-alone credit profile to 'bbb' from 'bbb+'. While we believe HL Bank has opportunities to realize revenue and cost synergies, the bank does not have a track record of mergers and acquisitions. Its ability to successfully manage the integration process, therefore, remains to be seen,' he said.

Tan said nevertheless, the acquisition will propel HL Bank to the fourth largest bank in the country and increase its share of loans and deposits in the system.

'In our opinion, the enlarged HL Bank is of moderate systemic importance and qualifies for one notch of government support," he said.

Standard & Poor's said based on pro forma calculations, the acquisition would weaken the merged entity's financial profile, including its asset quality.

HL Bank's nonperforming asset ratio is healthy compared with its peers'. The ratio was 2.1% at end-December 2010 compared with EON Cap's 3.6%.

HL Bank is also more profitable than EON Cap, with a return on assets of 1.24% as at end-December 2010, compared with EON Cap's 0.83%.

The combined entity will also have a higher proportion of risk assets. It said 70% of EON Cap's balance sheet consists of lower quality loans.

In comparison, HL Bank has about 50% of its total assets in loans, 23% in lower risk cash and interbank deposits, and 26% in securities (predominantly government bonds).

Meanwhile, non-innovative Tier 1 capital that HL Bank raised in May 2011 will largely offset the immediate capital impact arising from the cost of acquisition.

Standard & Poor's believed the merged entity's financial profile will be driven by: (1) how HL Bank executes its merger and integration plans to realize revenue and cost synergies; and (2) whether HL Bank can effectively implement its more conservative risk culture across the organization.

Hua Yang acquire 1.55 acres land in KL, plans RM160m property project

KUALA LUMPUR: HUA YANG BHD [] has acquired 1.55 acres of prime land in the Desa Pandan Commercial Centre in Kuala Lumpur and plans to undertake a property project with an estimated RM160 million in gross development value.

It said on Wednesday, May 11 the parcel of land is opposite the Royal Selangor Golf Club and minutes away from Jalan Tun Razak would be the site for its proposed mixed serviced apartment and commercial centre. It is acquiring the parcel of land for RM32 million from U Thant Square Sdn Bhd.

Its chief executive officer Ho Wen Yan said this was part of the overall group strategy to expand its operations in the Klang Valley, with its developments in Sungai Besi, Selayang and now, Kuala Lumpur City Centre.

'We are looking at a modern lifestyle concept for the project with club facilities and amenities ' suitable for city dwellers who enjoy the sights and sounds of the city,' he said.

He said the prime land will be developed into a mixture of studio units and one and two-bedroom apartments.

Petronas Gas 4Q net profit up 32.4% to RM266.66m, proposes final dividend 35c

KUALA LUMPUR: PETRONAS GAS BHD [] (PetGas) net profit for the fourth quarter ended March 31, 2011 jumped 32.4% to RM266.66 million from RM201.39 million a year earlier due mainly to higher gas transportation revenue and utility sales.

Revenue rose to RM891.19 million from RM802.21 million. Earnings per share was 13.48 sen while net assets per share was RM4.28.

The company has proposed a final dividend of 35 sen per share under single tier system amounting to RM692.56 million for the financial year ended March 31, 2011, subject to shareholder approval at its next annual general meeting.

For the financial year ended March 31, PetGas's net profit rose to RM1.44 billion from RM940.89 million a year earlier, on the back of revenue RM3.52 billion.

Commenting on its prospects, PetGas said on Wednesday, My 11 that revenue from the new fee structure under the Gas Processing and Transmission Agreement (GPTA) was dependent on the volume of the gas processed at the gas processing plants as well as volume of gas delivered directly into the pipeline network.

The performance based structure will continue to provide PetGas with additional earnings potential which is dependent on the level of production of by-products and their prices, it said.

As internal gas consumption is provided by Petronas, PetGas's exposure to fuel gas price fluctuation is eliminated, it said.

'The revised terms under the GPTA do not introduce new operating risks to PetGas; it better defines the obligations of the parties to the GPTA.

'Prospects for the utilities business will mainly depend on petrochemical customer demand. Any variation in gas price will be reflected in the pricing to customers,' it said.

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Dialog 3Q net profit rises 20.4% to RM38.34m

KUALA LUMPUR: DIALOG GROUP BHD [] net profit for the third quarter ended March 31, 2011 rose 20.4% to RM38.34 million from RM31.84 million a year earlier, due mainly to higher contribution from its engineering and CONSTRUCTION [], and plant maintenance activities in Malaysia and Singapore.

Revenue for the quarter rose to RM301.16 million from RM282.77 million. Earnings per share was 1.95 sen while net assets per share was 28.46 sen.

Dialog declared a interim single-tier cash dividend'' of 1.3 sen per share in respect of the financial year ending June 30, 2011.

For the nine months ended March 31, Dialog's net profit rose to RM107.43 million from RM87.4 million in 2010 on the back of revenue RM833.49 million.

Reviewing its performance, Dialog said the provision of specialist product and services for its international operation also recorded better performance in the third quarter.

In addition, the commencement of operation by Langsat Terminal (One) Sdn Bhd in Tanjung Langsat, Johor in September 2009 for its Phase 1 and in April 2010 for its Phase 2, had also contributed positively to the group's financial results, it said.

Commenting on its prospects, Dialog said it would continue to grow its core businesses with recurring income, such as, its specialist products and services, and plant maintenance services while at the same time focusing resources on the expansion of its logistics business.

The company said it had obtained approval from the Department of Environment for the Detailed EIA for the Pengerang Independent Deepwater Terminal project and expects to commence the construction work soon after receiving approvals from all the partners and other relevant authorities.

Dialog said that following the recent acquisition of Fitzroy Engineering Group Limited, one of New Zealand's largest heavy fabrication and multi-disciplined engineering company with about 400 employees, it was able to take on bigger fabrication jobs and grow this core business.

The company also said that it was together with its international partners were presently tendering for upstream oil and gas prospects in Malaysia.

'The group will continue to strengthen its presence in existing markets while penetrating new ones internationally.

'In line with the growing opportunities in the global oil and gas business, the group will continue to focus on developing and growing its human capital and talent pool to cater for rapid expansion,' it said.

Dialog said barring any unforeseen circumstances, it was optimistic that its performance would be favourable for the financial year ending June 30, 2011.

Wah Seong 1Q net profit surges to RM43.37m

KUALA LUMPUR: WAH SEONG CORPORATION BHD [] net profit for the first quarter ended March 31, 2011 surged to RM43.37 million from RM17.02 million a year earlier, due to increasing activities recorded in all divisions of the Group, especially in the pipeline services division.

Revenue for the quarter jumped 19.84% to 490.89 million from RM409.62 million. Earnings per share was 5.83 sen while net assets per share was RM1.31.

Commenting on its prospects, Wah Seong said on Wednesday, May 11 that the continued global demand for oil and gas and the current price of crude oil was expected to spur investment activities of oil majors.

'This increase in investment activities together with the existing orders in hand is expected to have a positive impact on the group's performance for the financial year ending Dec 31, 2011,' it said.

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Carlsberg 1Q net profit up 29.3% to RM48.94m

KUALA LUMPUR: CARLSBERG BREWERY MALAYSIA BHD [] net profit for the first quarter ended March 31, 2011 rose 29.3% to RM48.94 million from RM37.85 million a year ago, due mainly to higher sales during the Chinese New Year.

Revenue for the quarter rose to RM407.22 million from RM378.46 million. Earnings per share was 16.01 sen while net assets per share was RM2.07.

In a statement Wednesday, May 11, Carlsberg managing director Soren Ravn said the group benefitted from its successful 2011 Chinese New Year festive campaign and that its flagship Carlsberg brand remained the No 1 beer brand in Malaysia.

He said the company continued to focus and grow in the premium beer segment through its subsidiary Luen Heng F & B Sdn Bhd.

The Hoegaarden brand in its portfolio of premium beer brands continued to register exceptional share growth and Kronenbourg 1664 beer brand was also establishing itself in the premium beer category, he said.

Ravn said Carlsberg Malaysia now had seven of the world's leading international beer brands in its Group portfolio.

'Our associate company, Lion Brewery Ceylon PLC has also outperformed and contributed to the group's earnings,' he said.

On its outlook for the year, Ravn said Carlsberg expects to benefit from the recent

Malaysian launch and investment in Carlsberg's new global campaign where the

Carlsberg new packaging and campaign tagline 'That Calls for a Carlsberg' were now fully aligned with Carlsberg in over 140 countries around the world.

'The new Carlsberg big bottle had been extremely well received by our trade customers, consumers and other stakeholders,' he said.

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FBM KLCI extends gains

KUALA LUMPUR:'' The FBM KLCI closed above the 1,530-point level for the first time in a week on Wednesday, May 11 with gains at banking and index-linked PLANTATION [] stocks lifting the market.

The FBM KLCI rose 0.83% or 12.66 points to 1,536.03.

Gainers led losers by 594 to 202, while 285 counters traded unchanged. Volume was 1.05 billion valued at RM1.63 billion.

Among the major gainers, HLFG jumped 54 sen to RM11.68, Hong Leong Bank was up 52 sen to RM12.02, RHB Capital 13 sen to RM8.87, Maybank seven sen to RM8.77 and CIMB three sen to RM8.22.

Other gainers included Panasonic that rose 38 sen to RM23.18, Amway 25 sen to RM9.37, Tahps 24 sen to RM4.80, Mudajaya 23 sen to RM4.79, Kian Joo 22 sen to RM2.30 and Aeon Credit 20 sen to RM4.52.

Among the plantation-related stocks, Sime Darby was up 21 sen to RM9.05, PPB six sen to RM16.66 and KLK two sen to RM21.02.

DBE Gurney was the most actively counter with 43.5 million shares done. The stock shed half a sen to 7 sen.

Other actives included Karambunai, Petronas Chemicals, MAA, Digistar, PJI, Dialog, Mclean and Fitters.

Among the decliners were F&N, NPC, JT International, Turiya, RCI and Nationwide.

At the regional markets, Japan's Nikkei 225 rose 0.46% to 9,864.26, South Korea's Kospi jumped 1.28% to 2,166.63 and Singapore's Straits Times Index added 0.66% to 3,177.18.

Meanwhile, Hong Kong's Hang Seng Index slipped 0.19% to 23,291.80, the Shanghai Composite Index fell 0.25% to 2,883.42 and Taiwan's Taiex shed 0.03% to 9,020.40.

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Sealink to sell two vessels for RM87m

KUALA LUMPUR: SEALINK INTERNATIONAL BHD []'s wholly owned units have secured contracts worth RM87 million for the sale of two offshore support vessels.

In a statement Wednesday, May 11, Sealink said its units Sealink Marine (L) Ltd and Sealink Engineering and Slipway Sdn Bhd had secured the contracts and that the vessels were expected to be delivered by the third quarter of 2011.

It said that one of the vessels amounting to RM55 million was sold to an established overseas buyer whilst the other vessel was sold to Logistine Sdn Bhd, an associate company of Sealink Group.

The sale of the vessel to Logistine Sdn Bhd was made through a finance lease arrangement and Logistine is provided with an option to purchase the vessel at any time during the lease period of six years, said Sealink.

Logistine Sdn Bhd had secured a long term charter for this vessel to be delivered.

Sealink said the sales were part of its normal operations as a ship builder and ship owner.

It said the contracts were expected to contribute positively to its earnings for the financial year ending Dec 31, 2011.

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Nasim to launch Peugeot RCZ next week

KUALA LUMPUR: Nasim Sdn Bhd , the official distributor of the Peugeot brand in Malaysia, will launch the Peugeot RCZ coupe next week.

In a statement Wednesday, May 11, Nasim chief executive officer SM Nasarudin SM Nasimuddin said he was confident that the RCZ, which would enter the niche premium coupe segment in the market, would be well received.

"The RCZ has won several notable awards in the last 12 months and it's not surprising to see why.

'Its futuristic exterior, luxurious interior and powerful engine is catered for enthusiasts who enjoy driving and want to make a statement,' he said.

He said the RCZ was voted the most beautiful car of the year at the 25th International Automobile Festival.

The RCZ features avant-garde styling and proportions that has begun a new dynamic chapter in Peugeot's history, he said.

Nasarudin said the RCZ, which is a 2+2 coupe, would be available from Nasim in both automatic and manual transmissions mated to a powerful twin-scroll turbocharged engine.

'The RCZ is the second of three models to be launched by Nasim this year and will be part of a roadshow at the Bangsar Shopping Centre from May 20 to May 22,' he said.

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HLFG, HL Bank advance on strong positive outlook

KUALA LUMPUR: Shares of HONG LEONG FINANCIAL GROUP BHD [] (HLFG) and HONG LEONG BANK BHD [] (HL Bank) advanced on Wednesday, May 11, as investors' sentiment was galvanised by the recent corporate developments including the conclusion of the takeover of EON CAPITAL BHD [] and also strong earnings.

At 3.33pm, HLFG was up 68 sen to RM11.82 with 860,400 shares done while its subsidiary HL Bank added 44 sen to RM11.94.

The FBM KLCI rose 14.28 points to 1,527.65. Turnover was 718.97 million shares valued at RM1.03 billion. There were 502 gainers, 222 losers and 294 stocks unchanged.

UOB Kay Kian Research said it was maintaining a BUY on HL Bank with target price of RM13.70.

'We like HL Bank for its transformation strategy, going for stronger growth from more aggressive organic expansion. The new HL Bank is likely to leverage on the enlarged network to continue its aggressive and innovative growth strategies to capture a larger market share and build up a regional presence to have

more significant contributions from its overseas operations (Singapore, China and Vietnam),' it said.

MClean slips below offer price

KUALA LUMPUR:'' Shares of MClean Technologies Bhd slipped below its offer price of 52 sen in afternoon trade on Wednesday, May 11,ignoring the overall positive sentiment in the stock market.

At 3.48pm, it was down'' four sen to 49.5 sen with 10.84 million shares done.

The FBM KLCI rallied 13.47 points, the most in recent weeks, to 1,536.84. Turnover was 778.91 million shares valued at RM1.12 billion.'' There were 509 gainers, 223 losers and 298 stocks unchanged.

MClean was listed on Tuesday. It is mainly involved in precision cleaning and washing solutions for various components as well as plastic injection moulding for the hard disk drives (HDD) and automotive industries.

RHB Research accorded MClean a fair value 57 sen, based on 7.5 times FY11 earnings per share.

Its offer of 2.7 million new shares offered to the public under its listing exercise at 52 sen each was oversubscribed by'' 100.49 times.

F&N sees 25,000 shares done off-market at RM16.35

KUALA LUMPUR: Fraser and Neave Holdings Bhd (F&N) saw 25,000 shares transacted at RM16.35 in an off-market deal.

According to stock market data, this was RM2.77 or 14.5% below Tuesday's closing price of RM19.12.

This was also RM2.63 below the current share price of RM18.98. At 4.02pm, the shares are down 14 sen to RM18.98 with 47,700 shares done.

The FBM KLCI is up 13.1 points to 1,536.47. Turnover is 826.12 million shares valued at RM1.19 billion. There are 503 gainers to 223 losers and 317 stocks unchanged.

AmResearch has reiterated its BUY recommendation on F&N and lifted its fair value from RM17.40 a share to RM22.70'' a share, based on a PE of 18x CY11F earnings.

'We believe a small premium is justified given F&N's strong earnings profile within the non-discretionary food industry against a backdrop of rising material costs, as underpinned by its market share leadership position and brand equity strength,' said AmResearch.