#Updated* Lotus to breakeven by 2014, says Syed Zainal

SHAH ALAM: PROTON HOLDINGS BHD []'s unit Lotus is expected to breakeven by 2014, said Proton group managing director Datuk Seri Syed Zainal Abidin Syed Mohamed Tahir.

He said Lotus cars plans to raise ''270m via conventional financing from six financial institutions.

The six institutions acting as lenders are CIMB Bank, Maybank, OCBC, Exim Bank, Affin Bank and EON Bank.

However, Syed Zainal did not provide a breakdown of how much Lotus would seek from each of the respective banks.

The loan syndication forms part of the funding required to execute the five year business plan.

With the closing of the syndication exercise, the external portion of the funding is now in place.

The loans will be consolidated into Proton's books, said Syed Zainal.

Meanwhile, Lotus chief executive officer Dany Bahar said the company had been selling between 2,000 and 3,000 units of cars per year, adding it had two models.

'We hope to sell 7,000 cars a year when we have three models,' he said.

At 11.17am, Proton was up nine sen to RM3.34 with 33,000 shares traded.

FBM KLCI extends losses at mid-morning

KUALA LUMPUR: The FBM KLCI extended its losses on Friday, April 15 in line with the lackluster mood at key regional markets as disappointing U.S. data and a likely pickup in Chinese inflation gave market players an excuse to take profits after a recent sharp rally.

At mid-morning, the FBM KLCI slipped 0.90 point to 1,524.90, weighed by losses including at BAT, DiGi, Petronas Dagangan and Hong Leong Bank.

Gainers edged losers by 183 to 180, while 220 counters traded unchanged. Volume was 128.02 million shares valued at RM149.71 million.

Asian stock markets are set to snap three consecutive weeks of gains as spiralling commodity prices stoked worries about a broader pickup in inflation within the region even as traders waited for Chinese data later in the day, according to Reuters.

Unofficial reports say inflation will be a shade higher than originally forecast at 5.3-5.4 percent, triggering concerns that more aggressive policy action may be needed to prevent the economy overheating, it said.

At the regional markets, Japan's Nikkei 225 shed 0.43% to 9,612.23 and South Korea's Kospi lost 0.245 to 2,135.84.

Hong Kong's Hang Seng Index edged up 0.05% to 24,025.86, Taiwan's Taiex rose 0.04% to 8,806.46, the Shanghai Composite Index added 0.02% to 3,043.29 while Singapore's Straits Times Index was flat at 3,158.94.

On Bursa Malaysia, BAT was the top loser and fell 62 sen to RM47.28; DiGi fell 34 sen to RM29.16, Petronas Dagangan 14 sen to RM16.06, MMHE 12 sen to RM6.71, Hong Leong Bank and Glenealy 10 sen each to RM10.30 and RM4.75, Petronas Gas eight sen to RM11.28, Amway and KLK six sen each to RM9 and RM20.84, while Lafarge Malayan Cement fell five sen to RM7.35.

Viztel was the most actively traded counter with 6.9 million shares done. The stock added one sen to 9 sen.

Other actives included Seal, Tebrau, Lion Corp, Key West, DBE Gurney and Talam.

Gainers included YTL Corp, Allianz, Paramount, Texchem, IJM PLANTATION []s, CBIP, CIMB and Eng Kah.

#Flash* Lotus to breakeven by 2014, says Syed Zainal

SHAH ALAM: PROTON HOLDINGS BHD []'s unit Lotus is expected to breakeven by 2014, said Proton group managing director Datuk Seri Syed Zainal Abidin Syed Mohamed Tahir.

He said Lotus cars plans to raise ''270m via conventional financing from six financial institutions.

The six institutions acting as lenders are CIMB Bank, Maybank, OCBC, Exim Bank, Affin Bank and EON Bank.

However, Syed Zainal did not provide a breakdown of how much Lotus would seek from each of the respective banks.

The loan syndication forms part of the funding required to execute the five year business plan.

With the closing of the syndication exercise, the external portion of the funding is now in place.

At 10.40am, Proton was up eight sen to RM3.33 with 30,000 shares traded.

Allianz extends gains

KUALA LUMPUR: ALLIANZ MALAYSIA BHD [] extended its gains on Friday, April 15 and was up 3.08% or 16 sen to RM5.36 at 10.50am with 162,900 shares traded.

The stock began its sharp ascend a day earlier after CIMB Equities Research said Allianz Malaysia offered the only exposure to a well-managed Malaysian composite insurer that is controlled by an established international insurance group.

The research house said on Thursday, April 14 that Allianz's key attractions were (1) its well-managed general insurance business with above-industry underwriting margin, and (2) the expected exponential expansion of life insurance contributions.

CIMB Research said Allianz was also set to ride on the upward adjustment of motor tariffs starting next year.

'Assuming a 40-50% discount to the P/E implied in our target price for AIA, we arrive at a target P/E range of 8-9.6 times, which implies a value of RM8.20-9.80 for Allianz or upside of 64-97%.

'Despite its strong fundamentals and bright outlook, the stock is trading at only 6x P/E and 1.2x P/BV. Its only drawback is its low liquidity due to lack of newsflow and coverage by analysts,' it said.

RHB Research initiates coverage on DRB-Hicom with outperform rating

KUALA LUMPUR: RHB Research has initiated coverage on DRB-HICOM BHD [] with an outperform recommendation at RM2.30 with a fair value of RM3.15 and said the company had significant dealflow potential that could continue to yield new business contracts going forward.

It said on Friday, April 15 that DRB-Hicom has largely flown under investors' radar since its acquisition by Etika Strategi and induction into the Albukhary Group of companies in 2005.

The ensuing years saw a makeover of the Group's businesses that included the acquisition of Bank Muamalat and Rangkai Positif and the disposal of non-core assets.

'DRB-Hicom is today an expansive industrial conglomerate with a dazzling array of assets grouped under three operating divisions that offer strong growth potential as well as a high degree of earnings resilience.

'We believe DRB-Hicom has significant dealflow potential that could continue to yield new business contracts going forward. ''DRB-Hicom has solid financials with significant balance sheet capacity to fund new businesses,' it said.

RHB Research said its sum-of-parts derived valuation of its various businesses amounted to RM4.20 per share.

'After ascribing a 25% holding company discount, we arrive at our fair value for the stock of RM3.15 per share.

'PER valuations of 7.7 times and 6.6 times FY12 and FY13 respectively are undemanding, considering the implied 3-year FY10-FY13 recurring net profit CAGR of 37.1%,' it said.

''

#Flash* Proton unit Lotus cars to raise £270m from six financial institutions.

SHAH ALAM: PROTON HOLDINGS BHD []'s unit Lotus cars plans to raise ''270m from six financial institutions.

The six institutions acting as lenders are CIMB Bank, Maybank, OCBC, Exim Bank, Affin Bank and EON Bank.

The loan syndication forms part of the funding required to execute the five year business plan.

With the closing of the syndication exercise, the external portion of the funding is now in place.

At 9.30am, Proton was up seven sen to RM3.32 with 12,500 shares traded.

CIMB Research maintains outperform call on MAS

KUALA LUMPUR: CIMB Research has maintained its Outperform rating on MALAYSIAN AIRLINE SYSTEM BHD [] (MAS) with a target price of RM2.30 based on an unchanged core P/E multiple of 7 times due to its continued long-term confidence in MAS's fleet renewal.

The research house said on Friday, April 15 that during the welcoming ceremony for MAS's first A330-300 delivery, the airline revealed measures to cope with higher fuel prices, including raising fuel surcharges to cover some 50% of the cost increase since the start of the year and scaling back its 2011 capacity growth from 10% to only 4%.

The fleet renewal programme was also continuing with the delivery of 12 new-generation planes by year-end, it said.

'Unfortunately, these measures will not come fast enough to prevent a set of weak 1H results due to cost pressures and the impact of Japan's earthquake on demand.

'Potential re-rating catalysts include continuing reforms to boost structural profitability. Our earnings forecasts are unchanged,' it said.

Trading interest to remain thin, says HwangDBS Vickers

KUALA LUMPUR: Trading interest on Bursa Malaysia is expected to be thin on Friday, April 15, as investors are likely to remain wary ahead of the Sarawak state elections to be held tomorrow, said HwangDBS Vickers Research.

After closing at its intra-day low of 1,525.80 yesterday, the benchmark FBM KLCI could struggle to overcome the immediate resistance level of 1,530 for the time being, it said.

'Rather, we reckon the key market barometer will probably continue to drift with a downward bias today.

'Reflecting the cautious sentiment, trading interest is expected to be thin just like yesterday, which saw fewer than 1 billion shares changing hands the whole day,' it said in a note April 15.

The research house said that amid the sluggish market condition, counters that may be in the limelight today include: (a) SP Setia, following its foray into Singapore to redevelop a property project; and (b) SEGi, which has entered into an arrangement with a Korean university to train and place nurses and allied health professionals in US, Canada and Europe.

Maybank IB ups target price for S P Setia to RM7.13

KUALA LUMPUR: Maybank Investment Bank Bhd Research says it is positive on S P Setia Bhd's (SPSB) latest acquisition of Leong Bee Court in Singapore given its strategic location and fair pricing.

The research house maintained its buy recommendation on S P Setia at RM6.50 and raised its target price for the stock to RM7.13 (from RM7.10 previously)

It said that despite minimal impact to earnings and RNAV, this project was important as it would strengthen SPSB's brandname in Singapore and showcase its development capabities and this in turn, will boost demand for SPSB's PROPERTIES [] in Malaysia by Singaporeans.

'We fine-tune our FY11-13 forecasts for the acquisition and raise RNAV by 1 sen.

'Our new TP is RM7.13 (10% premium to RM6.48 RNAV; ex-bonus TP is RM4.75),' it said in a note April 15.

Nikkei inches lower, energy stocks recoup losses

TOKYO: Japan's Nikkei stock average opened lower on Friday and is expected to round off a week of thin choppy trade inside the tight range that has confined it since the start of the month, with resource and energy shares bouncing back after oil prices gained the day before.

Resource-related companies such as Inpex Corp, Japan's largest oil and gas developer, rose in line with gains in commodity and oil prices as a weaker dollar offset worries that surging prices would erode demand.

Japan's benchmark Nikkei average opened down 0.1 percent at 9,646.22 on Friday, while the broader Topix shed 0.1 percent to 845.52. ' Reuters

''