Dutaland falls after IOI ends RM830m land deal

KUALA LUMPUR: Shares of DUTALAND BHD [] fell at the start of trade on Thursday, Oct 27 as investors reacted negatively to IOI Corp's decision to terminate the RM830 million land purchase deal.

At 9am, Dutaland was down 6.5 sen to 54.5 sen. There were 1.32 million shares done.

The FBM KLCI rose 3.75 points to 1,461.55. Turnover was 15.28 million shares valued at RM15.36 million. There were 77 gainers, 27 losers and 52 stocks unchanged.

On Tuesday, IOI Corp announced it terminated its proposed acquisition of 11,977.91 ha (29,597.42 acres) of oil palm PLANTATION [] land from Dutaland, citing 'non-compliance of certain terms and conditions'.

However, Dutaland has rejected the reasons for the termination.

ECM Libra Research said that as Dutaland does not accept the termination, a legal suit may ensue.

'Dutaland was expected to make a profit of RM511 million from the sale of the land and they may seek a specific performance relief from the court for the transaction to be completed,' it said.

The research house said at the price of RM69,294 a hectare, many considered the purchase to be a pricey

one. As such, some fractions of the market would perceive this to be a positive development.

ECM Libra Research said although the termination of the SPA is a setback to IOI's plan to increase its fresh fruit bunches, it may allow the group to look for better opportunities elsewhere. However, this issue between IOI and Dutaland will have to be resolved first.

Hibiscus up, active on US$55m O&G acquisition

KUALA LUMPUR: Shares of Hibiscus Petroleum Bhd climbed in active trade as investors were positive of its acquisition of a stake in Lime Petroleum Ltd for a total of US$55 million.

At 9.13am, Hibiscus was up one sen to 68.5 sen with 7.08 million shares done. The warrants added 1.5 sen to 30.5 sen with 10.939 million units transacted.

The FBM KLCI rose 5.01 points to 1,462.81. Turnover was 118.18 million shares valued at RM98.65 million. There were 154 gainers, 61 losers and 115 stocks unchanged.

Hibiscus Petroleum had on Tuesday proposed to pay US$55 million for a 35% stake in Lime with interest in three companies that have concession rights in offshore oil & gas exploration assets in the Middle East.

The Lime Group is principally involved in the exploration and production activities in the oil and gas industry in the Middle East region.

Hibiscus said Lime Group's assets are located in the Middle East, where extensive oil & gas infrastructure has been developed. It also said Lime Group's assets are located in an area where several other oil and gas companies with significant financial and technical resources operate.

'These other companies include major integrated oil and natural gas producers and numerous other independent oil and natural gas companies and individual producers and operators. In the event that Lime Group has a successful exploration campaign, the assets could attract interest from these other companies as acquisition targets and/or for partnerships,' it said.

RHB Research ups UEM Land fair value to RM1.65

KUALA LUMPUR: RHB Research Institute has raised the fair value for UEM Land to RM1.65 from RM1.40 but maintains its underperform rating.

It said on Thursday, Oct 27 that due to the growing presence of more 'Singapore Inc.' in Johor in the midst of uncertain global economic environment, its optimism on the Iskandar development is revived slightly.

'We therefore narrow our discount to RNAV to 35% (from 45%) to derive our revised fair value of RM1.65 (from RM1.40),' it said.

On Tuesday, UEM Land announced that its 50:50 JV company with UM Land ' Nusajaya Consolidated Sdn Bhd had inked two agreements with The Ascott Limited (under Capitaland).

The agreements were for Ascott to provide technical advisory services as well as manage and operate 204 units of service residences to be known as 'Somerset Puteri Harbour' in Nusajaya upon its expected completion.

'We believe the strategic tie-up is via UM Land as Capitaland has a 21% stake in the company. This new Somerset will be Ascott first presence in Johor,' it said.

Supermax advances, CIMB keeps Buy, TP RM4.38

KUALA LUMPUR: Shares of Supermax Corp Bhd advanced on Thursday, Oct 27 on the positive outlook for the glove maker while CIMB Equities Research maintained a Buy on the stock at a target price of RM4.38.

At 9.50am, it was up 16 sen to RM3.42 with 1.49 million shares done.

The FBM KLCI rose 5.24 points to 1,463.04. Turnover was 309.44 million shares valued at RM248.12 million. There were 226 gainers, 105 losers and 197 stocks unchanged.

CIMB Research said investors should accumulate Supermax shares. At just 8.7 times FY12 P/E, the stock was trading at half the valuation of Top Glove, making it a cheaper play on the sector where earnings have bottomed on the back of more stable rubber prices.

'A strengthening distribution platform will ensure that the world's second largest glove maker emerges unscathed from the next one to three years of overcapacity.

'Also, we gather that a bonus issue may be in the works. Supermax's results briefing left us feeling more positive about its prospects as it is beefing up its distribution platform,' it said.

Trading of Hirotako suspended for corporate exercise

KUALA LUMPUR: Trading in the securities of HIROTAKO HOLDINGS BHD [] was suspended on Thursday, Oct 27 from 9am to 5pm

The company said the request for the suspension was pending an announcement of a 'potential material corporate exercise involving the securities of Hirotako'.

Trading of Hirotako suspended for corporate exercise

KUALA LUMPUR: Trading in the securities of HIROTAKO HOLDINGS BHD [] was suspended on Thursday, Oct 27 from 9am to 5pm

The company said the request for the suspension was pending an announcement of a 'potential material corporate exercise involving the securities of Hirotako'.

CIMB Research has technical buy on MPHB

KUALA LUMPUR: CIMB Equities Research has a technical Buy on MULTI-PURPOSE HOLDINGS BHD [] at RM2.55 a share at which it is trading at a price-to-book value of 1.3 times.

It said on Thursday, Oct 27 that MPHB's share price broke out of its resistance trend line on Tuesday. Prices also tried to take out its 50-day SMA along the way.

'We think the stock is ripe for a stronger rebound. If we are right, prices should edge closer towards RM2.70 and RM2.87.

'Technical landscape remains conducive. MACD signal line is about to turn positive while RSI is above the 50pts mark,' it said.

CIMB Research said traders with higher risk appetite may start to nibble now. However, it is important to keep stop tight at below RM2.50-RM2.44.

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CIMB Research has technical buy on Supermax

KUALA LUMPUR: CIMB Equities Research has a technical Buy on Supermax Corporation at RM3.26 at which it is trading at a FY12 price-to-earnings of 8.8 times and price-to-book value of 1.5 times.

It said on Thursday, Oct 27 thatthe rebound from its September's low is still intact. Prices swung above its 30-day and 50-day SMAs to keep the bulls afloat.

'As long as the support trend line holds (now at RM3.00), we think the odds are slowly turning to the bulls. Next upswing is likely to push prices towards RM3.40 and RM3.60,' it said.

CIMB Research said the technical landscape remains positive. MACD signal line has returned to the black while RSI is above the 50pts mark.

'Any pullback is an opportunity to accumulate. However, put a stop at RM3.00 to limit downside risk,' it said.

CIMB Research has technical sell on Bina Goodyear

KUALA LUMPUR: CIMB Equities Research has a technical sell on Bina Goodyear at 67 sen at which it is trading at a price-to-book value of 0.5 times.

It said on Thursday, Oct 27 that the recent countertrend rebound may have exhausted. Prices hit a snag at the 50-day SMA and the bears have since become more aggressive.

'If the 30-day SMA fails to hold, there is a high possibility that the 74 sen high is likely its near term peak.

'Indicators are beginning to show signs of exhaustion. MACD histogram bars are easing while RSI has hooked downward. The next support levels are 64 sen and 55.5 sen,' it said.

CIMB Research said traders should do well selling into strength, especially near the 72 sen to 74 sen resistances. It would only review its call if 74 sen is taken out.

OSK Research reaffirms Buy on MAHB

KUALA LUMPUR: OSK Research is reaffirming its Buy call on Malaysia Airports Holdings Bhd (MAHB) with a discounted cashflow (DCF)derived target price of RM7.36.

It said on Thursday, Oct 27 MAHB reported commendable earnings, with its cumulative core net profit coming in line with its estimates but ahead of consensus.

OSK Research said topline growth was fuelled by higher passenger spending while its bottom-line got a boost from a higher utilisation rate and economies of scale.

'MAHB is likely to see a reduction in User Fees paid to the Government given the freeze on the airport operator's proposed tariff hike, as the Government will pay compensation for the potential revenue loss,' it said.

The research house said in the pipeline are two more JV initiatives and a 50-acre development of a factory outlet.

'With its 9MFY11 earnings in line, we make no changes to our earnings at this juncture. We re-affirm our BUY call, with a DCF-derived target price of RM7.36, based on 9% WACC,' it said.