Malaysia Daybreak | 25 June 2021 FBMKLCI Index
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Malaysia | June 25, 2021 Key Metrics Malaysia Daybreak | 25 June 2021 FBMKLCI Index 1,700 ▌What’s on the Table… 1,650 ———————————————————————————————————————————————————————————————————————————————————————— 1,600 1,550 Eco World Development Group Bhd – Slower 3QFY21F expected due to FMCO 1,500 1HFY10/21 core net profit was in line, supported by higher contribution from joint 1,450 ventures, lower administrative expenses and lower finance costs. 1HFY21 new 1,400 property sales came in higher at RM2bn (vs. RM333m in 1HFY20), accounting Jun-20 Aug-20 Oct-20 Dec-20 Feb-21 Apr-21 Jun-21 for c.70% of its FY21 new sales target of RM2.875bn. ——————————————————————————— FBMKLCI 1,555.71 -9.05pts -0.58% Eco World International – Surprised by special dividend JUN Future JUL Future 1552.5 - (-0.80%) 1553.5 - (-0.80%) Eco World International’s (EWI) 1HFY10/21 core net profit was in line with our ——————————————————————————— expectation, supported by handover of Yarra One and Wardian projects. EWI Gainers Losers Unchanged declared a special DPS of 5 sen, bringing YTD total DPS to 6 sen. We reiterate 195 911 372 ——————————————————————————— our Hold call with a revised TP of RM0.65. Turnover 5205.53m shares / RM3027.717m 3m avg volume traded 6578.44m shares Gamuda – Recovery angle is still in play post-9MFY21 3m avg value traded RM3812.62m ——————————————————————————— 9MFY21 results were in line; not reflective of the FMCO impact in 4QFY21F. We Regional Indices FBMKLCI FSSTI JCI SET HSI now impute a weaker 4QFY21F (-28% qoq fall in core net profit) due to the 1,556 3,120 6,012 1,586 28,882 FMCO but mitigated by earnings recovery from Celadon City. Retain Add; still an ———————————————————————————————— attractive recovery play. TP lowered to RM4.00. Market Indices Close % chg YTD % chg FBMKLCI 1,555.71 (0.6) (4.4) United Malacca Bhd – Indonesia to drive yields moving forward FBM100 11,032.78 (0.6) (4.1) FBMSC 15,776.06 (1.8) 1.4 FBMMES 7,354.32 (1.9) (31.5) FY4/21 core net profit was below expectations due to higher tax expenses. We Dow Jones 34,196.82 1.0 11.7 expect a better FY22F on higher CPO prices and Indonesian FFB yields. We NASDAQ 14,369.71 0.7 11.5 lower our TP to RM5.15 and reiterate our Hold call as we believe UMB appears FSSTI 3,119.62 0.0 9.7 FTSE-100 7,109.97 0.5 10.1 fairly valued at current levels. SENSEX 52,699.00 0.8 10.4 Hang Seng 28,882.46 0.2 6.1 JCI 6,012.06 (0.4) 0.6 KOSPI 3,286.10 0.3 14.4 Nikkei 225 28,875.23 0.0 5.2 ▌News of the Day… PCOMP 6,886.00 (0.5) (3.6) ———————————————————————————————————————————————————————————————————————————————————————— SET 1,585.72 (0.4) 9.4 Shanghai 3,566.65 0.0 2.7 • FMM: Move to Phase Two of FMCO after 28 Jun, open more economic sectors Taiwan 17,407.96 0.4 18.2 ———————————————————————————————— • Private Covid-19 vaccination rollout expected to start in Aug, says KJ Top Actives • Genting-backed PLAYSTUDIOS listed on Nasdaq Close % chg Vol. (m) SERBA DINAMIK 0.535 (10.1) 371.7 • Astro confirms partnership with Netflix FINTEC GLOBAL 0.030 (14.3) 179.5 • Sunway REIT unit picks OCBC to coordinate debt note MMAG HOLDINGS 0.165 3.1 146.6 DAGANG NEXCHANGE 0.760 (6.2) 115.2 • Malakoff, Solarvest to transform logistics facilities into solar powerhouses KNM GROUP 0.165 (8.3) 102.0 • KPMG resigns as Serba Dinamik external auditor SANICHI TECH 0.055 (15.4) 98.0 M3 TECHNOLOGIES 0.070 7.7 87.9 GLOBAL ORIENTAL 0.370 (5.1) 83.1 ———————————————————————————————— Economic Statistics Close % chg US$/Euro 1.1929 (0.03) RM/US$ (Spot) 4.1595 (0.04) RM/US$ (12-mth NDF) 4.2085 (0.34) OPR (%) 1.75 0.00 GOLD ( US$/oz) 1,775.29 0.01 WTI crude oil US spot (US$/barrel) 73.45 0.23 CPO spot price (RM/tonne) 3,700.50 2.35 ———————————————————————————————————————— Ivy NG Lee Fang, CFA T (60) 3 2261 9073 E [email protected] Show Style "View Doc Map" IMPORTANT DISCLOSURES, INCLUDING ANY REQUIRED RESEARCH CERTIFICATIONS, ARE PROVIDED AT THE END OF THIS REPORT. IF THIS REPORT IS DISTRIBUTED IN Powered by the THE UNITED STATES IT IS DISTRIBUTED BY CGS-CIMB SECURITIES (USA), INC. AND IS CONSIDERED THIRD-PARTY AFFILIATED RESEARCH. EFA Platform Sources: CIMB. COMPANY REPORTS Sources: CIMB. COMPANY REPORTS Malaysia Daybreak | June 25, 2021 Global Economic News The Bank of England pushed back against speculation that a surge in UK inflation means it’s preparing to boost interest rates, saying the economy still needs support to recover from the pandemic. The Central Bank warned against “premature tightening,” toughening its language on the need to maintain stimulus. The remarks contrasted with a sharp increase in the bank’s outlook for inflation, which officials now see peaking at 3%, a half point higher than their forecast just six weeks ago. (Bloomberg) The Pfizer-BioNTech vaccine is highly effective against the Delta variant of Covid-19, a Pfizer official in Israel said on Thursday. First identified in India, Delta is becoming the globally dominant version of the coronavirus, according to the World Health Organization. "The data we have today, accumulating from research we are conducting at the lab and including data from those places where the Indian variant, Delta, has replaced the British variant as the common variant, point to our vaccine being very effective, around 90%, in preventing the coronavirus disease, Covid-19," Alon Rappaport, Pfizer's medical director in Israel, told local broadcaster Army Radio. (Reuters) President Joe Biden will meet with a bipartisan group of U.S. senators on Thursday to discuss their proposed framework for an infrastructure bill as he looks to push a large-scale spending package through Congress despite Republican opposition. Members of the group of 21 senators, or "G-21," announced an agreement on a framework on Wednesday after a meeting with White House officials. The G-21 talks have focused on a $1.2tr, eight-year spending plan, with a mix of new and repurposed funding. (Reuters) A period of high inflation in the US may last longer than anticipated, two U.S. Federal Reserve officials said on Wednesday, prompting one to pull forward his views on when the central bank should start raising interest rates. Atlanta Fed President Raphael Bostic said with growth surging to an estimated 7% this year and inflation well above the Fed's 2% target, he now expects interest rates will need to rise in late 2022. (Reuters) Malaysia Economic News The Government is confident of meeting its target of vaccinating 89% of the population in Kuala Lumpur and Putrajaya, thus achieving herd immunity as early as August to realise the National Recovery Plan, said Federal Territories Minister Tan Sri Annuar Musa. He said the two Federal Territories which were centres for administrative and economic activities, have the resources and capabilities, including carrying out additional initiatives such as the mobile vaccine truck programme to expedite the vaccination exercise. (Bernama) The Chemical Industries Council of Malaysia (CICM) is urging the Government to immediately grant approval to limestone quarries to continue to operate in order to enable essential industries such as the water treatment and sugar industries to maintain supplies to the general public. In a statement, CICM said its members — including lime producers — are gravely concerned over the potential disruption to essential supplies, namely sugar and water, due to the non-availability of lime. (The Edge Markets) G1 and G2 categories contractors appointed by local authorities (PBT) to carry out construction works for small-scale projects have been allowed to operate throughout Phase 1 of the movement control order (MCO) 3.0 effective immediately, said the Ministry of Housing and Local Government (KPKT). The matter was decided in a special session of the National Security Council (MKN) on Monday chaired by Prime Minister Tan Sri Muhyiddin Yassin. (Bernama) 2 Malaysia Daybreak | June 25, 2021 The Master Builders Association Malaysia (MBAM) has urged the government to look into disruption to the supply chain of the construction industry since the commencement of the full movement control order (FMCO), which has affected the operations of critical construction works that are allowed during the lockdown. In a statement, MBAM president Tan Sri Sufri Mhd Zin said quarries are not allowed to operate, while supply of building materials such as aggregates had decreased, and the few ready-mixed concrete batching plants allowed to operate cannot meet the supply of concrete to contractors. (The Edge Markets) The Federation of Malaysian Manufacturers (FMM) is appealing to the Government to move to Phase Two of the Full Movement Control Order (FMCO) immediately after the end of Phase One on 28 Jun. This includes expanding the economic sectors that are allowed to operate and the capacity of operations, FMM said in a statement. FMM also suggested several other measures to be implemented in tandem with Phase Two, to avoid permanent and irreversible damage to businesses and the economy. The measures are: Extend the essential economic and services sectors approved to operate to include an en-bloc approval of the entire supply chain and increase the workforce capacity to 80%, Allow manufacturing industries in the non-essential economic sectors that have smaller workforce and are able to ensure proper social distancing at the workplace and those with contractual export orders to operate at 50% capacity on a 24/7 basis, and Allow critical manufacturing sectors e.g.