Ramunia dn on lower 2Q earnings

KUALA LUMPUR: RAMUNIA HOLDINGS BHD [] shares declined in early trade on Monday, June 20 after posting lower earnings in the second quarter ended April 30, 2011.

At 9.10am, Ramunia slipped 1.5 sen to 45.5 sen with 386,000 shares traded.

Its net profit fell 58.7% to RM1.41from RM3.42 million a year ago due mainly to a reduction in revenue due to the tail end of remaining projects billings and lower operating income.

Revenue fell to RM1.74 million from RM11.88 million in 2010. Earnings per share were 0.21 sen, while net assets per share were 25.3 sen.

Europe delays decision on emergency loans to Greece

LUXEMBOURG/ATHENS: Euro zone finance ministers postponed a final decision on extending a further 12 billion euros ($17 billion) in emergency loans to Greece, saying Athens would first have to introduce harsh austerity measures.

The ministers said in a statement that they expected to pay the money by mid-July. Greece has said it needs the loans by then to avoid defaulting on its debt.

But keeping up the pressure on Athens, the ministers insisted that disbursement would depend on the Greek parliament first passing laws on fiscal reforms and selling off state assets.

The statement, issued after a seven-hour meeting in Luxembourg that ran into the early hours of Monday morning, also committed the ministers to putting together a second bailout plan for Greece, beyond an initial 110 billion euro rescue launched in May last year.

The ministers said that in addition to more official loans, the new bailout would include a voluntary rollover by private investors of their Greek debt holdings. The statement did not say how large the new plan would be or give details of the rollover.

On Sunday, Prime Minister George Papandreou asked Greeks to support the austerity steps and avoid a "catastrophic" default. Addressing the Greek parliament, he appealed for the nation to accept deeply unpopular tax hikes, spending cuts and privatisation plans which international donors have demanded.

"The consequences of a violent bankruptcy or exit from the euro would be immediately catastrophic for households, the banks and the country's credibility," Papandreou said at the start of a confidence debate on his new crisis cabinet. ' Reuters

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ASIA-Shares may edge upward on euro unity

WELLINGTON: Asian stocks may post cautious gains on Monday, as France and Germany hinted at a deal to rescue Greece helped global markets recover some of their recent losses, however caution is still seen dominating.

France and Germany said they would ask banks holding Greek debt to voluntarily shoulder some of the burden. Meanwhile, Greece's prime minister appointed a new finance minister to try to push through harsh economic reforms.

News of the pact helped Wall Street on Friday, with the Dow up 0.4 percent and the S&P 500 up 0.3 percent.

Despite the gains bearish sentiment is still seen abounding in the market, until a long-term solution to the euro zone debt crisis is struck, with safe-haven gold rising while oil prices fell.

The tech-laden Nasdaq fell 0.3 percent, as poor results from blackberry-maker Research In Motion Ltd's saw its U.S.-listed shares sink 21.5 percent, dragging down other top TECHNOLOGY [] names such as Apple Inc.

Asian stocks listed on Wall Street fell 0.2 percent, while world stocks, as measured by the MSCI world equity index, were up 0.4 percent, and the Thomson Reuters global stock index was flat.

British shares rose 0.3 percent while European shares added 0.2 percent on a relief rally.

The euro gained against the U.S. dollar, which was also weighed down by mixed economic data, sending it lower against the yen.

Japanese markets are set to eke out gains despite the firmer currency, with Nikkei futures traded in Chicago 40 points above the last closing level in Osaka.

Australian stocks will likely make a flat start as base metal prices were subdued, with share price index futures up 3 points to 4,482, a 2.9 point discount to the close of the underlying S&P/ASX 200 index. ' Reuters

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Talam active, down in early trade

KUALA LUMPUR: TALAM CORPORATION BHD [] shares were actively traded on Monday, June 290 after high administrative and finance costs dented the company's first quarter earnings.

At 9.20am, Talam fell half a sen to 7 sen with 10.2 million shares done.

Talam posted net loss of RM25.97 million in the first quarter ended April 30, 2011 compared with net profit of RM1.56 million a year ago as it was impacted by the high administrative and finance costs totaling RM32.49 million.

Talam said administrative and other expenses totalled RM14.94 million while finance costs were RM17.55 million

Genting up on Miami project

KUALA LUMPUR: GENTING BHD []'s shares rose on Monday, June 20 after the gaming group announced it was pushing ahead with its US$3 billion Resorts World Miami mixed development.

Genting rose six sen to RM10.92 at 9.25am with 228,900 shares done.

Genting's announcement of the hiring of Miami-based Arquitectonica to create the master plan for its project came after three weeks of its successful US$236 million (RM717 million) bid for a 13.9-acre (5.6ha) waterfront land in northern downtown Miami, though a casino licence is not yet within reach.

HDBSVR: FBM KLCI may test 1,575 soon

KUALA LUMPUR: Hwang DBS Vickers Research said after an initial snag, the Malaysian stock market is showing signs of revival for an extended rally ahead.

'Therefore, we are keeping our hopes that the benchmark FBM KLCI could plot fresh highs by overcoming its record peak of 1,577 soon,' it said on Monday, June 20 in its technical outlook for the 30-stock index.

It said the KLCI jumped last Friday, June 17 to offset earlier losses for a weekly gain of 7.2-point or 0.5%. Finishing marginally weaker through the week were the FBM 70 Index (-0.1%) and the FBM ACE Index (-0.3%).

Trading activity picked up to a daily average volume of 824.1m shares valued at RM1.6b, from the 735.3m units worth RM1.4b traded the week before.

'Malaysia continues to shine as a defensive equity market with a year-to-date return of 2.9%, the best among the eleven regional share indices tracked by us and only one of two that are currently in positive territory (the other being Indonesia, up 0.5% so far this year),' it said.

HDBSVR said essentially, overseas equities are facing external headwinds which have dragged down their performance lately. This was the case last week when most Asian stock exchanges ' such as Hong Kong (-3.2%), China shares listed in Hong Kong (-2.7%) and Singapore (-2.4%) ' ended in the red.

Amid the growing worries about a doubtful global economic outlook (particularly in the U.S., China and Japan) and spillover effects arising from the ongoing Europe debt crisis, it will be interesting to hear the views of the U.S. Federal Open Market Committee when the policymakers meet this Tuesday and Wednesday.

'While the federal funds rate will probably be maintained, the focus is on whether: (a) the timing of any future rate hike will likely come later rather than sooner; and (b) QE2 (the quantitative easing program) will expire in end-June as previously stated or a QE3 plan will be hatched,' it said.

HDBSVR said on the local front, it should be a dry week and the same could be said for trading interest as daily volume is anticipated to come in more or less around 1bn shares just like what it has been in recent weeks.

'But this does not mean that all will be quiet on our local bourse as window dressing activities may be visible in the run-up to the end of first half of 2011.

'From a technical viewpoint, there is a chance for the FBM KLCI ' after breaking out from two downward sloping trend lines that stretched back to mid-Jan (see chart overleaf) ' to keep the positive momentum going,' it said.

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The research house said, if so, then it expects the benchmark index to extend its rally (from a recent low of 1,507.64 six weeks ago) and plot higher highs ahead.

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On the chart, the benchmark index, which settled at 1,563.43 last Friday, is in a position to test and overcome the immediate resistance level of 1,575 soon.

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A breakaway from this point could signal more upsides with the FBM KLCI likely to climb above its all-time peak of 1,576.95 (reached in early January this year) towards the next resistance target of 1,605.

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Should there be any intermittent market pullbacks the first two support lines for the bellwether are seen at 1,550 and 1,530, respectively

CIMB Research has Buy on Scientex at RM2.68

KUALA LUMPUR: CIMB Equities Research has a Buy on Scientex Bhd at RM2.68 at which it is trading at a price-to-book of 1.3 times.

It said on Monday, June 20 Scientex broke out of its triangle pattern last Friday on rising volume. Buying momentum should pick up strongly. The following resistance levels are RM2.83 and RM2.94.

'Technical landscape is improving. MACD has staged a positive crossover while RSI is also rising. Traders may start to accumulate now to ride this recovery wave. Only a break below the RM2.44 level would negate this positive trend,' it said.

Scientex manufactures polyvinyl chloride (PVC), polyurethane leather sheetings, packaging materials, bricks, and automotive parts.

CIMB Research has Buy on Alliance Financial Group

KUALA LUMPUR: CIMB Equities Research has a Buy on Alliance Financial Group at RM3.16 at which it is trading at a FY12 price-to-earnings of 10.2 times and price-to-book of 1.5 times.

In its technical outlook on Monday, June 20, it said the stock is consolidating in a triangle pattern. The support trend line has been tested on several occasions and we think it is a good indicator.

'We are now waiting for a breakout above RM3.20 before going long,' it said.

CIMB Research said the MACD histogram bars remain in the positive territory while RSI is also rising. The improving technical landscape shows that there should one more upleg.

'We would rather wait for push above RM3.20 before taking any position. The next resistance levels are RM3.31 and RM3.52. Be quick to trim losses if the RM3.00 level is breached,' it said.

Top Glove dips in early trade

KUALA LUMPUR: TOP GLOVE CORPORATION BHD []'s shares declined in early trade on Monday, June 20 as analysts remained cautious on the stock's outlook given the volatility of latex prices as well as higher energy costs.

At 9.05am, Top Glove fell four sen to RM5.22 with 4,000 shares traded.

Top Glove's net profit for the third quarter ended May 31, 2011 fell 60.3% to RM25.60 million from RM64.48 million a year earlier due mainly to higher latex price and weakening US dollar.

Revenue eased 3.7% to RM535.36 million from RM555.85 million. Earnings per share were 4.14 sen. It declared a first single tier net interim dividend of 5 sen, payable on July 21, 2011.

MIDF Research in a note June 20 said it expects Top Glove's sales volumes in 4QFY11 to grow but remain cautious due to high volatility of latex prices coupled with risks of further deterioration in rubber glove demand.

'Therefore, we downgrade our recommendation to SELL with a lower target price of RM4.18 per share.

'We ascribe a PER12 of 14 times, which is Top Glove's average 3-year forward PER band,' it said.

#Stocks to watch:* BToto, Time Engineering, TimeCom, AirAsia

KUALA LUMPUR: Berjaya Sports Toto will be in focus on Tuesday, June 21 following the announcement of its full year financial year results, which were lower than the previous year.

Other counters which could see trading interest are TIME ENGINEERING BHD [], TIME DOTCOM BHD [], AIRASIA BHD [] and Muhibbah Engineering Bhd.

BERJAYA SPORTS TOTO BHD []’s net profit rose 28.8% to RM104.18 million in the fourth quarter ended April 30, 2011 from RM80.89 million a year ago, boosted by strong record sales.

Revenue rose 5% to RM901.30 million from RM858.29 million while earnings per share were 7.79 sen versus 6.05 sen. It declared tax exempt dividend of three sen per share compared with eight sen a year ago.

For the financial year ended April 30, 2011, the net profit declined by 9.2% to 348,098 from the previous financial year’s RM383.50 million. Revenue inched up 1.28% to RM3.433 billion from RM3.392 billion. The total dividends were 21 sen compared with 57.5 sen a year ago.

Time Engineering fixed the renounceable offer for sale of up 626.18 million shares of Time dotCom Bhd at 53 sen.

Time Engineering said the offer price of 53 sen was 33.75% below the five-day volume weighted average market price up to June 17. Based on Monday’s closing price of 79 sen, this was a discount of 26 sen or 29%.

AirAsia Bhd is teaming up with CAE International Holdings Ltd to set up an aviation academy to provide training services for pilots, cabin crew, engineers, ramp handlers, guest services and aviation management.

The JV company to run the academy will have a paid-up capital of RM165.56 million of which AirAsia’s 50% share, being its capital and investment outlay in the JV shall be satisfied through its assets contribution.

RAM Rating Services Bhd says MUHIBBAH ENGINEERING (M) BHD []’s RM130 million Islamic bonds are not affected on the recent news about the receivership status of the owner of the Tanjung Bin petroleum hub project.

It said the group’s stand-alone credit profile was affected by its weaker-than-expected profit performance, balance sheet and debt coverage ratios, as well as its tight liquidity profile.

RAM Ratings said Muhibbah’s outstanding order book of RM2.9 billion as at May19 will sustain the group over the next two years.

It added Muhibbah also derives earnings diversity, from its involvement in the CONSTRUCTION [], cranes and shipyard segments. It also enjoys recurring dividend income from its associate stakes in the concessionaire for road-maintenance work in Malaysia and an operator and concession holder for three international airports in Cambodia.

SAAG CONSOLIDATED (M) BHD [] fixed the issue price for the sixth tranche of the placement of 15 million new shares of 10 sen each under the proposed private placement at an issue price of 10 sen each.

The placement price of 10 sen is 40.85% above the five-day weighted average market price of SAAG shares up to and including June 17 of 7.1 sen per share.

Meanwhile, at Tradewinds PLANTATION [] Bhd’s AGM, the Minority Shareholders Watchdog Group (MSWG) wants to raise a question about the proposed acquisition of Mardec Bhd which was reduced from RM150 million to RM140 million taking into account Ernst & Young appraisal of the fair value of Mardec group using the hybrid methodology.

MSWG will also query the company about the five-year financial performance of Mardec, including latest results.

At Ho Hup Construction Co Bhd’s AGM, the MSWG will ask the board to explain the implication of the auditors’ continued disclaimer of opinion.

The MSWG also wants to know how confident is the board that the proposed PN17 regularisation plan would eliminate the accumulated losses and turn around the group.