Hot Stocks Kumpulan Perangsang, Puncak rise on Selangor-federal govt water deal

by **Cals** Wed 26 Feb 2014, 17:30

Hot Stocks Kumpulan Perangsang, Puncak rise on Selangor-federal govt water deal

Business & Markets 2014

Written by Chong Jin Hun of theedgemalaysia.com

Wednesday, 26 February 2014 16:18

KUALA LUMPUR (Feb 26): Shares of water concession owners Kumpulan Perangsang Selangor Bhd (KPS) and Puncak Niaga Holdings Bhd rose as much as 11% and 4% respectively. The rise came on news that the Selangor state government and federal policy makers have signed an MOU to restructure the Klang Valley water sector.

At about 3.55pm, KPS rose to RM1.97 with some seven million shares done. The seventh-largest gainer across the bourse had earlier risen as much as 20 sen to RM2.

Puncak Niaga climbed to RM3.46 with about five million shares changing hands. The stock had earlier added as much 12 sen to RM3.48.

According to news reports, the Selangor government has issued the development order for the construction of the Langat 2 water treatment plant to the federal government.

A fund manager told theedgemalaysia.com over telephone today KPS and Puncak Niaga shares had risen on the news.

"We have increased our exposure to both stocks prior to the latest news," the fund manager said.

Kenanga Investment Bank Bhd wrote in a note today it had a target price of RM3.50 for Puncak Niaga shares. This comes with "market perform" call for the stock.

The latest updates on the Klang Valley's water-sector restructuring follows news last month that the Selangor government had ceased talks with concession owners to acquire their water assets in the state.

The cessation, in accordance with the Water Services Industry Act, was due to the Selangor government's failure to finalise deals with the water players by December 31 last year.