New high in Khazanah’s portfolio value

by **Cals** Tue 21 Jan 2014, 10:38

Business & Markets 2014

Written by Fatin Rasyiqah Mustaza of theedgemalaysia.com

Tuesday, 21 January 2014 09:37

KUALA LUMPUR: Khazanah Nasional Bhd posted a new high in its investment portfolio value last year, with overall realisable asset value (RAV) increasing 11.1% from RM121.5 billion as at Dec 31, 2012 while net worth adjusted (NWA) rose 19.1% from RM86.9 billion earlier.

Overall RAV increased 164.8% to RM134.9 billion as at Dec 31, 2013 from RM50.9 billion in May 2004, the year the government investment arm began a revamp of its operations. (RAV is the value of an asset that can be realised by a company upon the sale of the asset. NWA is defined as RAV less total liabilities and adjusted for equity injections less dividends paid).

Key listed companies in Khazanah’s investment portfolio include Telekom Malaysia Bhd, Tenaga Nasional Bhd, CIMB Group Holdings Bhd, Axiata Group Bhd, IHH Healthcare Bhd, Malaysia Airports Holdings Bhd and UEM Sunrise Bhd.

Managing director Tan Sri Azman Mokhtar told a media briefing on Khazanah’s 10th annual review yesterday that the growth in its 2013 portfolio value, as measured by its NWA of 19.1%, outperformed the benchmark FBM KLCI’s total returns of 14.4%.

The increase in NWA in 2013 also compares favourably to regional indices, such as the Singapore Straits Times Index (7.3%), Hong Kong Hang Seng Index (14.3%) and MSCI Asia ex-Japan (10.8%).

“Last year was eventful with highlights including better operating performance across practically all investee companies and deepening of the regional presence of various companies,” Azman said, adding that Khazanah expanded its regional footprint last year with the opening of two overseas offices in San Francisco in the United States and Istanbul, Turkey. It now has five offices globally.

He said Khazanah recorded a pre-tax profit of RM3.1 billion for the year ended Dec 31, 2013 from RM2.1 billion in 2012, resulting in a proposed dividend of RM650 million. Revenue for 2013 stood at RM7.6 billion, comprising dividend income totalling RM6.6 billion and divestment gains and other income of more than RM1 billion.

Last year, it made a total of 14 investments amounting to RM6.7 billion, and six divestments with a gain of RM682 million.

Azman said Khazanah is starting 2014 from a position of relative strength, but remains cautious as markets, economies, societal and political trends continue to be uncertain.

“We are also cautious on divestments. We have to be clear at what price we walk away and at what price we stand firm on,” he said, noting that Khazanah is keen on seeking more investments in the Asian insurance market.

Other new sectors that might be of interest to the group include technology, creative life sciences and theme parks.

Meanwhile, Khazanah is looking forward to the “graduation” of its government-linked companies’ transformation programme. The aim of the programme is to create regional champions and to develop the companies’ competitiveness.

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Azman: We are also cautious on divestments.

This article first appeared in The Edge Financial Daily, on January 21, 2014.

by **Cals** Tue 21 Jan 2014, 10:38

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New high in Khazanah’s portfolio value

New high in Khazanah’s portfolio value

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