Hot Stock Brahim shares fall 4% after PM said possible to let MAS go bankrupt

by **Cals** Tue 20 May 2014, 00:02

Hot Stock Brahim shares fall 4% after PM said possible to let MAS go bankrupt

Business & Markets 2014

Written by Jonathan Gan of theedgemalaysia.com

Monday, 19 May 2014 14:37

KUALA LUMPUR (May 19): Brahim Holdings Bhd shares fell today following Prime Minister Datuk Seri Najib Razak’s comments that it was “too late to save Malaysian Airlines Bhd (MAS).”

At midday market break today, shares of the food and beverage caterer for MAS fell 8 sen or 4 per cent to RM2 per share with some 2 million shares traded.

Last weekend, Najib was quoted as saying in an interview with The Wall Street Journal that filing for Chapter 11 bankruptcy might be among several options as a way to restructure the national flag carrier, after years of losses and bitter conflicts with its labour unions.

MAS losses widened to RM443.4 million in the first quarter ended March 31, 2014, from a net loss of RM278.8 million a year earlier.

An analyst with a major stock broking firm told theedgemalaysia.com that Brahim’s share price performance would depend heavily on how MAS would be restructured.

“It’s all very fluid at the moment and it all depends on how MAS will be restructured,” said the analyst

Meanwhile, Alliance Research has maintained its “strong buy” rating on the stock with a target price (TP) of RM2.95.

In a note last week, the research house noted that the stock had been under heavy selling pressure following media reports that MAS was planning to renegotiate the terms of its major procurement contracts, including Brahim’s Airline Catering (BAC)

The report added that the MAS contract accounted for 70 % of BAC’s revenues but said the issue could be over-sensationalised.

“Brahim’s remains the sole in-flight caterer that has sufficient capacity to serve MAS at KLIA, which suggests strong bargaining power in the future renegotiation with MAS,” said the research team at Alliance.

In a technical note by Kenanga Research today, Brahim Holdings Bhd was listed among the stocks that “were most down by net change”.

The report placed the immediate support levels at RM2.08 with subsequent levels at RM2.04 and RM1.97.

by **Cals** Tue 20 May 2014, 08:30

chainreaction cause and effect, wonder what else will be affected, jobs? and other complementing industries Lipsrsealed

Hot Stock Brahim shares fall 4% after PM said possible to let MAS go bankrupt

Hot Stock Brahim shares fall 4% after PM said possible to let MAS go bankrupt

Re: Hot Stock Brahim shares fall 4% after PM said possible to let MAS go bankrupt