Stocks to watch: Encorp, Ho Hup, Sime Darby, TSM

KUALA LUMPUR: Stocks on Bursa Malaysia ended on Friday, March 12 on a disappointing note after surging past the 1,300 level earlier in the week. The 30-stock FBM KLCI will have to stay above the crucial 1,300 level on Monday, March 16, accompanied by stronger buying interest and on a broader base, if it is to convince more participation from investors.

Week-on-week, the FBM KLCI was up 11 points to end at 1,311.2 but off the intra-week high of 1,328. Its market capitalisation was up only RM8 billion to end at RM1.032 trillion, off the intra-week high of 1.048 trillion.

On Wall Street, investors will try to tack another leg on to the year-long US stock rally, looking to the forthcoming week's economic data and statement from the central bank for evidence the recovery is still on track.

Reuters reports Wall Street could see more volatility than it has of late with four types of March futures and options contracts set to expire or settle at the end of next week, an event known as "quadruple witching." The quarterly event tends to attract high volume as investors adjust or exercise their derivative positions.

On Friday, mixed consumer and retail data kept U.S. stocks near break even on Friday, March 12 but major indexes edged higher for a second straight week.

The Dow Jones industrial average gained 12.85 points, or 0.12%, to end at 10,624.69. The Standard & Poor's 500 Index shed 0.25 point, or 0.02%, to 1,149.99. The Nasdaq Composite Index dipped 0.80 point, or 0.03%, to close at 2,367.66.



For the week, the Dow gained 0.55 percent, the S&P 500 climbed 1 percent and the Nasdaq advanced 1.78 percent

Stocks to watch this forthcoming week include ENCORP BHD [], Ho Hup CONSTRUCTION [] Co. Bhd, SIME DARBY BHD [] and TSM.Global Bhd.

Encorp has proposed a corporate exercise which includes a rights issue of up to RM111.75 million in loan stocks with warrants and a placement of the loan stocks.

The corporate exercise involved a renounceable rights issue of up to RM111.75 million nominal value of 5-year 6% redeemable convertible secured loan stocks (RCSLS) at 100% of its nominal value.

In Ho Hup, Kenanga Investment Bank Bhd has advised minority shareholders to reject the resolution which involves the disposal of a piece of land in Kuala Lumpur.

The corporate exercise involves Ho Hup’s 70%-owned Bukit Jalil Sdn Bhd’s proposed disposal of the 10.865 acres of land to Permata Juang (M) Sdn Bhd for RM19.408 million.

Kenanga said the disposal price was a “significant discount of 8.88%” to the current market value while there is a demand for the property based on the offers received by the tenderors which is at a higher price.

It also said the Ho Hup board had no immediate plans to develop the property due to its current affected listed issuer and the group’s financial constraints.

Sime Darby Property Bhd hopes to maintain its 28% profit margin for its financial year ending June 30, 2010 following the successful launches recently.

Managing director Datuk Tunku Putra Badlishah said it recorded an 80% sales rate within three months of the launch. "We are positive about this as all our recent launches had been very successful.”

Meanwhile, TSM Global plans to expand its new hard disk drive business aggressively. Its corporate strategy includes acquiring hard disk drive component manufacturer Kenseisha, says The Edge Weekly in its latest issue.

Talam's Crop Bhd’s exit from the Practice Note 17 exit could be delayed. Possible prolonged negotiations on asset disposals may keep the company in PN17 status lo



NTPM HOLDINGS BHD [], which reported strong year-on-year earnings, announced a first interim single tier dividend of 14.5% for the financial year ending April 30, 2010. The dividend will be paid on April 16.