Stocks to watch: Oversea Enterprise, BCorp, Pos, Supermax, IOI

Tags: BCorp | IOI | Oversea Enterprise | Pos | Supermax

Written by The Edge Financial Daily
Thursday, 01 April 2010 08:00

KUALA LUMPUR: Stocks on Bursa Malaysia may start off the second quarter, Thursday April 1 on a more cautious note after US stocks fell following a surprising drop in private-sector employment.

The decline in the jobs market stoked concerns about the health of the US labour market. The Dow Jones industrial average dropped 50.79 points, or 0.47 percent, to close at 10,856.63. The Standard & Poor's 500 Index shed 3.84 points, or 0.33 percent, to 1,169.43. The Nasdaq Composite Index fell 12.73 points, or 0.53 percent, to end at 2,397.96.

At Bursa Malaysia, blue chips have been struggling despite the overall positive strategies put forward by the government under its New Economic Model.

For the first quarter, the FBM KLCI is up 3.75% after it closed at 1,320.57 on Wednesday. Most key regional markets are also ended the first quarter on a firmer note. Market capitalisation is at RM1,061 billion, up RM60 billion in the first quarter.

Among the 30-member FBM KLCI stocks, Astro All Asia recorded the best returns with 42.67% after announcing the privatisation plan, Axiata 26.23%, PPB Group 16.26% and Telekom Malaysia 12.42% while CIMB recorded 9.50%.

Stocks to watch on Thursday are Oversea Enterprise Bhd, which will be listed on the ACE Market, Berjaya Corp Bhd, POS MALAYSIA BHD [], IOI CORPORATION BHD [] and Supermax Corp Bhd.

OSK Research says Oversea has a well established presence with over 30 years of culinary expertise, earning them recognition across the region.

Targeting to open one new outlet in Ipoh and a café outlet in Klang Valley by 2011, Overseas plans sights to expanding abroad via a new licensing program to operate food service outlets under their brand name.

“For its listing on the ACE market, we think the offer price of RM0.23 at 7.8x FY10 EPS is fair given that its earnings is relatively smaller as compared to its peers which are trading in the range of 9-11 times price-to-earnings ratio,” it said.

BERJAYA CORPORATION BHD [] (BCorp), whose share price hit an 11-year high of RM1.77 in intra-day trade on Tuesday, announced on Wednesday, a net loss of RM155.12 million on the back of RM1.66 billion revenue in its third quarter ended Jan 31, 2010 (3QFY10).

BCorp rose three sen to RM1.75 at market close on Wednesday before the announcement of its latest quarterly results. It gained 45 sen or 34.61% for the month of March. Revenue fell 4%, while net profit stood at RM17.94 million a year earlier.

BCorp, the flagship company of tycoon Tan Sri Vincent Tan, said on Wednesday the 3QFY10 loss was mainly due to non-cash dilution effects amounting to RM150.46 million when its interest in BERJAYA LAND BHD [] (BLand) was diluted from 56.44% to 53.25% upon maturity of the BLand ICULS on Dec 31, 2009.

Pos Malaysia has recommended a first and final dividend of 12.5 sen per ordinary share less tax. The dividend was subject to shareholders' approval at its forthcoming AGM.

Shares of Pos Malaysia rose to a four-month high of RM2.34 in intra-day trade after the government announced that Khazanah Nasional would divest its 32% stake. On Tuesday, Pos Malaysia also jumped 19 sen (+9.2%), its largest gain since May 18 last year.

SUPERMAX CORPORATION BHD [] is expected to reap the immediate fruits from the US Healthcare Reform Bill as the glove maker is set to increase its export of medical examination gloves to the US market by 5% to 7% in FY10.

IOI Corporation Bhd may write back the impairment loss made in the financial year ended June 30, 2009 (FY09) on a joint-venture property project in Singapore towards the end of the current financial year since the value of property has risen in the island state.

HONG LEONG BANK BHD []'s (HLBB) move to revive its offer for EON CAPITAL BHD []'s (EONCap) assets and liabilities was not surprising. What was surprising was the fact that the sixth largest bank returned with the same offer price as had been rejected by the EONCap board nearly two months ago.

Wong Engineering suffered a loss after tax of RM124, 000 in the current 1st quarter ended January 31, 2010 as compared to a profit after tax of RM249, 000 made in the corresponding quarter in preceding year.

MALAYAN BANKING BHD [] subsidiary Bank Internasional Indonesia (BII) is mulling over getting investment banking and insurance licences in Indonesia.

International Trade and Industry Deputy Minister Datuk Mukhriz Mahathir has disposed of his 26.94% direct stake comprising 34.75 million shares in OPCOM HOLDINGS BHD [] to M Ocean Capital Sdn Bhd, a company owned by his spouse Datin Norzieta Zakaria.