Update - Stocks to watch: JCY, Axiata, MAHB, KLK, Media Prima

Written by Loong Tse Min & Joseph Chin
Thursday, 25 February 2010 08:04

KUALA LUMPUR: Stocks on Bursa Malaysia are expected to rise on Tursday, Feb 25, underpinned by the recent strong earnings, more upside for the economy and also the firmer overnight close on Wall Street.

In the US, stocks climbed on Wednesday as investors welcomed the promise of more cheap money following reassurance from Federal Reserve Chairman Ben Bernanke that interest rates will remain low.

The Dow Jones industrial average gained 91.75 points, or 0.89 percent, to 10,374.16. The Standard & Poor's 500 Index rose 10.64 points, or 0.97 percent, to 1,105.24. The Nasdaq Composite Index advanced 22.46 points, or 1.01 percent, to 2,235.90.

In Malaysia, the economy rebounded from a recession, expanding by an annual rate of 4.5% in the fourth quarter (4Q) of last year, following three consecutive quarters of contraction in the gross domestic product (GDP).

Prime Minister Datuk Seri Najib Razak forecast the economy would grow by 5% this year.

Stocks to watch on Thursday are JCY International which will list on the Main Board. Its institutional price was fixed at RM1.60 per share and the retail offer was RM1.52 per share. The earlier indicative retail price for JCY was RM2.

JCY's net profit for the first quarter ended Dec 31, 2009 (1QFY10) jumped 223% to RM77.46 million from RM24 million a year ago attributed to factors such as product mix, economy of scale, capacity utilisation, cost control measures and raw materials cost.

Axiata Group Bhd, Malaysia Airports Holdings Bhd (MAHB), KUALA LUMPUR KEPONG BHD [] and MEDIA PRIMA BHD [].

Axiata posted net profit of RM558.28 million in the fourth quarter ended Dec 31, 2009 versus a net loss of RM515.28 million a year ago, driven mainly by improved contribution from Celcom Group, XL Group, AxB and Dialog Group.


MAHB, whose net profit rose 145% year-on-year (y-o-y) to RM140.24 million in its fourth quarter ended Dec 31, 2009 (4QFY09), is looking at raising between RM2 billion and RM2.5 billion in the first half (1H) of the year.

KLK's net profit more than tripled to RM241.8 million in its first quarter ended Dec 31, 2009 (1QFY10) from RM65.8 million a year earlier, due to improved downstream operations and its retail division as well as a RM19.3 million writeback of investment losses.

Profit before tax (PBT) rose 124.1% to RM329.5 million although revenue fell 7.2% to RM1.7 billion from RM1.9 billion. No dividend was declared.

KLK said the higher PBT was due to improved earnings from its manufacturing sector, especially the oleochemical division with a profit of RM29.9 million compared with RM2.7 million in 1QFY09 when it wrote off inventories at its China plant.

Media Prima's net profit for its fourth quarter ended Dec 31, 2009 (4Q09) soared to RM192.31 million from RM4.65 million a year earlier, while full-year earnings more than doubled to RM194.8 million from RM86.02 million.

Other counters to watch are CIMB Group Holdings Bhd, which surged 34 sen or 2.69% boosted by its best-ever financial performance.

Multi-level marketing company HAI-O ENTERPRISE BHD [] plans to venture into the China market in one or two years, said group managing director Tan Kai Hee. It also has no plans to raise prices of its products despite the higher production costs.

TRANSMILE GROUP BHD [] lost half its value yesterday, plunging 50% to close at 45.5 sen, its lowest since October 2008, after it reported a whopping net loss of RM213.2 million in its fourth quarter ended Dec 31, 2009 (4QFY09) and falling into PN17 status.