Kenanga Today

12 March 2021

By Ahmad Ramzani Ramli l [email protected]

BURSA 11-Mar Day chg % chg KLCI 1,629.4 -10.42 -0.64% Research Highlights FTSE EMAS 11,934.8 -17.7 -0.15% FTSE Smallcap 16,775.7 275.03 1.67% NEWS HIGHLIGHTS FTSE MESDAQ 10,443.1 90.7 0.88% ⚫ MISC wins seven-year charter contracts from Shell for three crude KLSE Mkt Cap 1,771.5 -0.4 -0.02% (RM'b) carriers (Comment included in Kenanga Today) ⚫ FGV expands animal feed and nutrition business by launching new BURSA DAILY TRADING PARTICIPATION animal feed brand 'ALMA' Participation Net (RM’m) Value (%) Local Institution -137.0 44.4% ⚫ After winning bid for Khazanah's SilTerra stake, DNeX bags three- Local Retail 64.6 40.9% year national single window contract extension Foreign 72.5 14.7% ⚫ MKH to launch new block of MIRAI Residences INDICES 11-Mar Day chg % chg Dow Jones 32,485.6 188.6 0.58% ⚫ Aimflex commits to dividend policy of at least 30% of profit S&P 500 3,939.3 40.5 1.04% MACRO BITS NASDAQ 13,398.7 329.8 2.52% FTSE-100 6,737.0 11.4 0.17% ⚫ IMF urges vigilance against rate spike as Biden stimulus juices U.S. Nikkei 225 29,211.6 175.1 0.60% growth SHCOMP 3,436.8 79.1 2.36% ⚫ OPEC sees most of 2021 oil demand recovery in second-half as HSI 29,385.6 478.1 1.65% COVID-19 impact lingers STI 3,106.0 26.3 0.85% KOSPI 3,013.7 55.6 1.88% ⚫ WTO cautious after sharp services trade rebound TWSE 16,179.6 267.9 1.68% JCI N.A. N.A. N.A. ⚫ Govt has approved RM1.315b under PENJANA SME Financing SET 1,575.1 2.1 0.13% scheme, says Tengku Zafrul

FOREX 11-Mar 10-Mar % chg ⚫ Covid-19: 223,923 individuals vaccinated as at March 10 USD/MYR: 4.1065 4.1263 -0.48% ⚫ targets stable growth with focus on new jobs, Li says EUR/USD: 1.1963 1.1895 0.57% GBP/USD: 1.3961 1.3891 0.50% ⚫ Japan's wholesale price falls narrow in Feb. as pandemic impact USD/YEN: 108.44 108.73 -0.27% eases USD/SGD: 1.3397 1.3468 -0.53% USD/HKD: 7.7585 7.7626 -0.05% ⚫ U.S. weekly jobless claims fall more than expected ⚫ COVID-19 relief payments to start going out this month: White KEY STATS KLCI Spot House's Deese Vol (m shares): 9,530.1 11,007.2 -13.42% ⚫ inflation tops 5.0% for first time in four years, rate hike likely Value (RMm): 5,438.0 7,197.1 -24.44% KLCI Future ⚫ European bonds rally after ECB pledges to step up asset purchases March-21 1,626.5 1,625.5 0.06% April-21 1,620.0 1,621.0 -0.06% ⚫ EU study finds Covid-19 has already wiped out six million jobs CPO Price 3,920.0 3,839.0 2.11% (RM/tonne) ⚫ Let's reset ties, EU urges Britain over post-Brexit relations Soybean (US$/bu) 1,413.5 1,409.8 0.27% ⚫ UK spending climbed in early March: ONS SoyOil (USc/lb) 53.0 52.2 1.67% Gold (US$/troy oz) 1,722.6 1,721.8 0.05% IDEAS OF THE DAY (SEE SEPARATE REPORTS FOR DETAILS) Nymex crude oil 66.0 64.4 2.45% (US$/bbl) ⚫ On Our Technical Watch: AWC, KPOWER Latex (RM/kg) 6.82 6.87 -0.73% ⚫ Rating Summary Tin (US$/mt) N.A. 28,397.0 N.A.

# Top Volume Top Gainer Top Loser %Chg Vol %Chg Vol %Chg Stock Price Stock Price Stock Price Vol (m) (+/-) (m) (+/-) (m) (+/-) 1 TOPGLOV 5.32 0.0 28.30 GENM 3.15 1.3 15.50 PETDAG 19.98 -3.5 0.19 2 PBBANK 4.34 -2.5 26.00 DIALOG 3.31 1.2 6.51 PBBANK 4.34 -2.5 26.00 3 SUPERMX 4.21 -1.2 15.70 SIME 2.36 0.9 7.96 HAPSENG 8.10 -2.4 0.22 4 GENM 3.15 1.3 15.50 TENAGA 10.80 0.8 3.94 DIGI 3.70 -2.1 3.35 5 CIMB 4.60 -0.9 9.35 IHH 5.31 0.4 8.98 MAXIS 4.63 -1.9 2.28 6 GENTING 5.14 -0.6 9.15 PCHEM 8.20 0.4 5.73 PETGAS 15.70 -1.8 1.10 7 IHH 5.31 0.4 8.98 KLK 23.28 0.3 0.82 TM 6.10 -1.6 6.29 8 SIME 2.36 0.9 7.96 RHBBANK 5.57 0.2 4.48 SUPERMX 4.21 -1.2 15.70 9 8.55 0.1 7.22 MAYBANK 8.55 0.1 7.22 MISC 6.90 -1.0 3.09 10 DIALOG 3.31 1.2 6.51 TOPGLOV 5.32 0.0 28.30 PMETAL 10.00 -1.0 5.15 Notes: # KL Composite Index (FBMKLCI) component stocks

PP7004/02/2013(031762) Page 1 of 6

Kenanga Today

12 March 2021

Corporate News

• MISC wins seven-year charter contracts from Shell for three crude carriers MISC has been awarded three long-term charter contracts to own and operate three newbuild LNG Dual Fuel VLCCs from Shell Group for the operations in international waters. The charters are for a period of seven years and expected to commence in 3QFY23. (Source: Bursa )

Comment: We are positive on the contract win, further increasing the group’s term charter exposure for its petroleum shipping portfolio (current term-to-spot ratio is at 65:35). This will also expand its current fleet of VLCC vessels of 11 and total petroleum shipping vessels of 66. Note that there will be deliveries of another 9 petroleum shipping vessels from now until 2023 (2 VLCCs, 7 DPSTs – all of which will be on long-term contracts). Based on our back-on-envelope calculations, assuming an IRR assumption of 7% and capex per vessel of ~USD100m, we gathered that charter rates should be around ~USD65k/day. While these are slightly higher than the rates for conventional VLCC tankers (as a comparison, current market rate for 3-year VLCC charters are at ~USD27k/day), do that note that: (i) these are LNG Dual Fuel VLCC vessels, which typical requires 25-40% more capex than the conventional VLCC vessels, and (ii) the charters are long-term (i.e. 7 years), which typically yields higher charter rates than spot or mid-term charters. As a like-for-like comparison, we believe the rates should be comparable to the current market, and should be broadly in-line with MISC’s previous charters for similar vessel types. Overall, we made no changes to our FY21-22E numbers, as the contracts will have a minimal impact on earnings (~1% of earnings at mid-single digit PBT margins), while balance sheet impact should also be relatively small (net-gearing of ~0.2x). Maintain OUTPERFORM with TP of RM8.10, pegged to 1.1x PBV. The stock is backed by stable dividend yields of ~5%, as well as its commendable ESG ratings (constitute of F4GBM Index, and 4-star FTSE Russel ESG rating). (By: Steven Chan)

• FGV expands animal feed and nutrition business by launching new animal feed brand 'ALMA' FGV Holdings Bhd has expanded its animal feed and nutrition business by launching a new animal feed brand. In a statement, the planter announced that its subsidiary FGV Integrated Farming Holdings Sdn Bhd has launched its animal feed brand, "ALMA". FGV chief executive officer (CEO) noted that the group's domestic sales of palm kernel expeller (PKE) and animal feed products increased to 39,000 metric tonnes (MT) in 2020 from 8,000 MT in 2018, with a compound annual growth rate of 121%. (The Edge)

PP7004/02/2013(031762) Page 2 of 6

Kenanga Today

12 March 2021

• After winning bid for Khazanah's SilTerra stake, DNeX bags three-year national single window contract extension Dagang NeXchange Bhd (DNeX), fresh from winning the bid from Khazanah Nasional Bhd for its stake in loss-making wafer foundry SilTerra Malaysia Sdn Bhd last month, announced that its unit has been granted an extension contract for a period of three years to operate the National Single Window (NSW) for trade facilitation. (The Edge)

• MKH to launch new block of MIRAI Residences MKH Property Ventures Sdn Bhd, a joint venture company between MKH Bhd and Panasonic Homes Malaysia Sdn Bhd from Panasonic Homes Group, will launch a new block of MIRAI Residences in Kajang 2 this month. (The Edge)

• Aimflex commits to dividend policy of at least 30% of profit Aimflex Bhd, previously known as i-Stone Group Bhd, has committed to adopting a dividend policy of at least 30% of profit for each financial year, according to its executive chairman. Speaking at the rebranding launch event in Kuala Lumpur, executive chairman said the dividend payout ratio of at least 30% of the profit after tax excludes any unrealised income from adjustments due to accounting policies that are non-cash in nature. The group has announced an interim dividend of 0.25 sen per share to its shareholders for its financial year ended Dec 31, 2020 (FY20). (The Edge)

This section is intentionally left blank

PP7004/02/2013(031762) Page 3 of 6

Kenanga Today

12 March 2021

Macro Bits Global ⚫ IMF urges vigilance against rate spike as Biden stimulus juices U.S. growth The International Monetary Fund on Thursday warned central banks to be vigilant against a sudden spike in interest rates and tighter financial conditions that could spill over into emerging markets, even as a USD1.9t U.S. stimulus package will benefit most countries. (Reuters) ⚫ OPEC sees most of 2021 oil demand recovery in second-half as COVID-19 impact lingers OPEC said on Thursday a recovery in oil demand will be focused on the second half of the year as the impact of the pandemic lingers as a headwind for the group and its allies in supporting the market. (Reuters) ⚫ WTO cautious after sharp services trade rebound Trade in services grew an accelerated pace at the end of last year, but momentum appears set to slow as spikes of COVID-19 cases bring a return of lockdowns, the World Trade Organization said on Thursday. (Reuters) Malaysia ⚫ Govt has approved RM1.315b under PENJANA SME Financing scheme, says Tengku Zafrul The government had approved 6,973 applications with a total loan value of RM1.315b under the National Economic Recovery Plan (PENJANA) Small and Medium Enterprise (SME) Financing scheme as at Feb 26, 2021, compared with RM1.258b as of the previous week. (The Edge Markets) ⚫ Covid-19: 223,923 individuals vaccinated as at March 10 Health Minister Datuk Seri Dr said Sarawak recorded the highest number of vaccine recipients at 28,194, followed by Selangor (24,211), Kuala Lumpur (20,510) and Sabah (18,670). (The Edge Markets) Asia Pacific ⚫ China targets stable growth with focus on new jobs, Li says China is prioritizing stable economic growth and the creation of new jobs as its main goals for 2021, with the nation needing sustainable expansion, not large fluctuations, Premier Li Keqiang said. (The Edge Markets) ⚫ Japan's wholesale price falls narrow in Feb. as pandemic impact eases Japan’s wholesale prices fell at a slower pace in February for a third straight month, offering an encouraging sign a recent rebound in fuel costs and pick-up in domestic demand will ease deflationary pressures across the economy. (Reuters) Americas ⚫ U.S. weekly jobless claims fall more than expected Fewer than expected Americans filed new claims for unemployment benefits last week as an improving public health environment allows more segments of the economy to reopen, putting the labor market recovery back on track. (Reuters) ⚫ COVID-19 relief payments to start going out this month: White House's Deese A top White House economic aide said on Thursday that direct payments from the recently passed coronavirus relief plan would start going out this month through direct deposits, as he touted the package’s promises of helping with poverty, small businesses and job creation. (Reuters) ⚫ Brazil inflation tops 5.0% for first time in four years, rate hike likely Annual inflation in Brazil rose above 5.0% in February for the first time in four years, official figures showed on Thursday, above analysts’ expectations and almost certainly setting the seal on an interest rate hike next week. (Reuters) Europe ⚫ European bonds rally after ECB pledges to step up asset purchases Eurozone government bonds rallied and the continent’s stock markets trended higher after the European Central Bank pledged to speed up its asset purchases to deal with a jump in global borrowing costs. (Financial TImes) ⚫ EU study finds Covid-19 has already wiped out six million jobs The first wave of the Covid-19 pandemic wiped out some six million jobs in the European Union, according to a study released on Thursday, with temporary contractors, young and female workers at times hit harder than in the 2008-09 financial crisis. (The Edge Markets) ⚫ Let's reset ties, EU urges Britain over post-Brexit relations Britain and the European Union should stop trying to score points in their post-Brexit relationship, the bloc's ambassador to London said on Thursday, appealing for a more constructive approach to their increasingly thorny ties. (The Edge Markets) ⚫ UK spending climbed in early March: ONS Britons have picked up the pace of their spending after a plunge at the start of the year when the country went back into a third coronavirus lockdown, data published on Thursday showed. (Reuters)

PP7004/02/2013(031762) Page 4 of 6

Kenanga Today

12 March 2021

List of Oversold Stocks (14-Day RSI<30-mark) NAME* LAST PRICE RSI_14D RSI_9D RSI_3D LOW 30D PHARMANIAGA BERHAD 3.400 16.24 13.26 14.56 3.350 ABF MALAYSIA BOND INDEX FUND 1.194 16.68 10.19 3.59 1.194 APEX HEALTHCARE BHD 2.900 21.26 19.19 31.55 2.870 ATLAN HOLDINGS BERHAD 2.900 24.59 19.76 7.60 2.890 KOTRA INDUSTRIES BHD 2.550 27.47 25.03 15.29 2.500 THONG GUAN INDUSTRIES BHD 2.000 28.20 27.30 40.55 1.950 DAIBOCHI BHD 2.310 29.99 21.84 1.09 2.300 *Only for stocks with market cap >RM300m Source: Bloomberg

List of Overbought Stocks (14-Day RSI>70-mark) NAME* LAST PRICE RSI_14D RSI_9D RSI_3D HIGH 30D MSM MALAYSIA HOLDINGS BHD 1.860 85.49 85.74 84.83 2.090 SUNWAY BHD 1.700 83.18 89.13 97.18 1.740 DATAPREP HOLDINGS BHD 2.880 82.85 81.23 69.98 3.330 KWANTAS CORP BHD 1.650 80.29 90.64 99.99 1.650 PLENITUDE BHD 1.140 78.71 86.24 98.00 1.140 SYARIKAT TAKAFUL MALAYSIA KE 4.990 76.73 82.71 85.16 5.080 KIMLUN CORP BHD 0.855 76.00 85.78 99.02 0.860 FAVELLE FAVCO BHD 2.270 75.87 83.65 97.66 2.300 MATRIX CONCEPTS HOLDINGS BHD 1.920 75.61 83.85 98.32 2.020 CCK CONSOLIDATED HOLDINGS BH 0.695 75.55 78.47 71.39 0.720 TUNE PROTECT GROUP BHD 0.485 74.41 81.34 97.83 0.495 KUMPULAN PERANGSANG SELANGOR 1.190 74.04 76.22 77.36 1.350 TAMBUN INDAH LAND BHD 0.695 73.86 83.65 99.03 0.700 GUAN CHONG BHD 3.180 73.81 77.70 89.18 3.200 BUMI ARMADA BERHAD 0.475 73.38 76.93 84.26 0.495 DAGANG NEXCHANGE BHD 0.870 73.23 74.42 82.67 0.955 I-BHD 0.290 72.55 73.99 59.03 0.310 NAIM HOLDINGS BERHAD 0.865 72.45 78.49 95.36 0.875 MUHIBBAH ENGINEERING (M) BHD 1.040 72.26 78.46 95.13 1.050 O.S.K. HOLDINGS BHD 0.910 72.18 81.18 98.68 0.925 ISKANDAR WATERFRONT CITY BHD 0.515 71.99 83.56 97.35 0.530 WCT HOLDINGS BHD 0.555 71.82 77.57 93.05 0.570 HUME CEMENT INDUSTRIES BHD 1.220 71.69 78.73 94.35 1.220 MEDIA PRIMA BHD 0.700 71.62 69.98 67.36 0.750 STAR MEDIA GROUP BHD 0.440 70.94 72.16 71.56 0.465 CAN-ONE BHD 3.100 70.56 75.83 84.99 3.130 MALAYSIAN RESOURCES CORP BHD 0.500 70.36 73.30 64.96 0.530 SERN KOU RESOURCES BHD 2.330 70.27 69.59 66.34 2.490 SPRITZER BHD 2.000 70.16 78.76 93.58 2.000 KUB MALAYSIA BHD 0.685 70.05 74.08 86.52 0.715 *Only for stocks with market cap >RM300m Source: Bloomberg

List of Oversold Warrants (14-Day RSI<30-mark) NAME LAST PRICE RSI_14D RSI_9D RSI_3D LOW 30D EXPIRY DATE TOP GLOVE COR-CI 0.055 12.50 12.50 41.40 0.045 8/10/2021 SUPERMAX CORP-CI 0.010 24.69 19.43 6.48 0.010 26/7/2021 JF TECHNOLOGY BHD-WA 0.485 26.69 31.38 61.69 0.415 23/1/2026 SUPERMAX CORP-C98 0.190 27.42 25.27 22.61 0.180 31/5/2021 Source: Bloomberg

List of Overbought Warrants (14-Day RSI>70-mark) NAME LAST PRICE RSI_14D RSI_9D RSI_3D HIGH 30D EXPIRY DATE MMC CORP BHD-C24 0.355 93.00 94.63 97.79 0.380 30/7/2021 SCH GROUP-WA 0.080 82.48 87.74 96.58 0.105 5/12/2021 AIRASIA GROUP-CJ 0.125 80.27 88.36 98.25 0.135 26/4/2021 AWC BERHAD -WA 0.235 76.21 78.31 80.85 0.305 25/12/2023 MMC CORP BHD-C23 0.105 75.68 82.37 92.10 0.125 27/8/2021 VALESTO ENERGY BHD-WA 0.100 73.19 76.54 82.05 0.110 18/10/2024 STRAITS INTER LOGISTIC-WA 0.135 71.82 71.92 52.42 0.285 10/8/2022 SERBA DINAMIK HOLDINGS-WA 0.240 70.50 76.20 93.10 0.245 5/12/2024 Source: Bloomberg

PP7004/02/2013(031762) Page 5 of 6

Kenanga Today

12 March 2021

Stock Ratings are defined as follows:

Stock Recommendations

OUTPERFORM : A particular stock’s Expected Total Return is MORE than 10% MARKET PERFORM : A particular stock’s Expected Total Return is WITHIN the range of -5% to 10% UNDERPERFORM : A particular stock’s Expected Total Return is LESS than -5%

Sector Recommendations***

OVERWEIGHT : A particular sector’s Expected Total Return is MORE than 10% NEUTRAL : A particular sector’s Expected Total Return is WITHIN the range of -5% to 10% UNDERWEIGHT : A particular sector’s Expected Total Return is LESS than -5%

***Sector recommendations are defined based on market capitalisation weighted average expected total return for stocks under our coverage.

This document has been prepared for general circulation based on information obtained from sources believed to be reliable but we do not make any representations as to its accuracy or completeness. Any recommendation contained in this document does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may read this document. This document is for the information of addressees only and is not to be taken in substitution for the exercise of judgement by addressees. Kenanga Investment Bank Berhad accepts no liability whatsoever for any direct or consequential loss arising from any use of this document or any solicitations of an offer to buy or sell any securities. Kenanga Investment Bank Berhad and its associates, their directors, and/or employees may have positions in, and may effect transactions in securities mentioned herein from time to time in the open market or otherwise, and may receive brokerage fees or act as principal or agent in dealings with respect to these companies.

Published and printed by:

KENANGA INVESTMENT BANK BERHAD (15678-H) Level 17, Kenanga Tower, 237, Jalan Tun Razak, 50400 Kuala Lumpur, Malaysia Telephone: (603) 2172 0880 Website: www.kenanga.com.my E-mail: [email protected]

PP7004/02/2013(031762) Page 6 of 6