July 9th - Stocks to Watch Banking stocks, TRC, Fajarbaru, Pelikan, CSL, Bina Darulaman, Harvest Court

by **Cals** Wed 09 Jul 2014, 08:54

Stocks to Watch Banking stocks, TRC, Fajarbaru, Pelikan, CSL, Bina Darulaman, Harvest Court

Business & Markets 2014

Written by Ahmad Naqib Idris Adzman Shah of theedgemalaysia.com

Tuesday, 08 July 2014 21:27

KUALA LUMPUR (July 08): Based on newsflow and corporate announcements today, the following stocks may draw market interest tomorrow (July 09):

Banking stocks such as Public Bank Bhd, Hong Leong Financial Group Bhd (HLFG) and RHB Capital Bhd, are seen as major beneficiaries of a potential interest rate hike by Bank Negara Malaysia (BNM) this week.

In a note today, AllianceDBS Research Sdn Bhd analysts, Lim Sue Lin and Hon Seow Mee, said that Bank Negara might raise the overnight policy rate (OPR) by 25 basis points to 3.25%, from 3%, at the upcoming monetary policy committee (MPC) meeting this Thursday (July 10).

Lim and Hon said a rate hike would be positive for most banks, because variable-rate and base lending rate-based loans tend to be re-priced within a week after an OPR hike announcement.

However, M&A Securities said that BNM is unlikely to raise the OPR at the upcoming meeting, as a rate hike during the month of Ramadhan is likely to burden the people.

Head of Research, Rosnani Rasul, said the government would prefer BNM to defer a hike in the OPR, to the September MPC meeting.

Rosnani opined that the government would be risking its reputation, if it proceeded with a policy hike during the month of Ramadhan, as about 55% to 60% of the Malaysian population are Muslims observing the fast.

TRC Synergy Bhd's wholly-owned subsidiary, Trans Resources Corp Sdn Bhd, has bagged a RM191 million contract for the proposed refurbishment and upgrading of Malaysia's Parliament House.

In a statement to the exchange today, TRC said it had secured the contract from the Public Works Department last Friday (July 04).

“Barring unforeseen circumstances, the board is of the opinion that the project will contribute positively to the earnings and earnings per share of the TRC group, in the future,” it said.

Fajarbaru Builder Group Bhd’s wholly-owned subsidiary, Fajarbaru Builder Sdn Bhd, has been awarded a contract worth RM49.13 million for roadworks relating to the Elevated Diamond Interchange to Malaysia-China Kuantan Industrial Park and the upgrading of the Sg Ular Interchange in Pahang.

The contract was awarded by the East Coast Economic Region Development Council (ECERDC) and will commence on July 21, 2014, for duration of 78 weeks.

“The contract is expected to contribute positively to the earnings and net assets of the FBG Group, for the financial years ending 30 June 2015 and 30 June 2016,” said the company.

Pelikan International Corporation Bhd plans to list its key subsidiaries and selected assets in Germany, a move to facilitate the group to raise at least RM491.3 million, from private placement and offer for sale.

In a filing with Bursa Malaysia on July 07 (Monday), Pelikan said that the proposed listing would include asset streamlining exercise, which involves assets injection within the group and Pelikan Holding AG (PHAG), into Herlitz Aktiengesellschaft (Herlitz), for RM1.19 billion (266 million euros).

In exchange, Pelikan will receive 266 million new shares in Herlitz — its 70.92%-owned subsidiary, which is listed on the Frankfurt Stock Exchange.

Meanwhile, Pelikan also proposed a private placement of up to 50 million Herlitz shares, at a minimum offer price of one euro apiece, as well as the offer for sale of up to 30 million Herlitz shares, by Pelikan and PHAG each.

China Stationery Ltd (CSL) will not be suspended, because it has submitted its outstanding annual audited accounts for the financial year ended Dec 31, 2013. However, it has been fallen into Practice Note 17 status.

The trading of the company’s shares were originally due for suspension on July 09, 2014, after Bursa Malaysia had rejected its request for extension, for the submission of its outstanding annual reports.

Bina Darulaman Bhd announced that its wholly-owned subsidiary, Bina & Kuari (K) Sdn Bhd, has been awarded a sub-contract from Ibra HS Sdn Bhd, for federal road works in Baling Kedah.

The sub-contract is worth RM9.45 million and will be for a duration of 12 months, up to May 28, 2015.

Harvest Court Industries Bhd's single-largest shareholder, Zenith City Investment Ltd, plans to remove four existing directors in the construction firm and appoint new board members there.

In a statement to the stock exchange today, Harvest Court said Zenith was colllaborating with Syawaras Sdn Bhd to remove the four directors, as Harvest Court's financial performance had deteriorated under the existing board and management's stewardship.

Zenith and Syawaras have proposed to remove Datuk Mohamed Amir Abas Zainal Azim, Ng Wai Han, Zainuri Zainal and Woo Mun Chee.

Both Zenith and Syawaras have, meanwhile, proposed the appointments of three new directors in Harvest Court. They are Datuk Seri Abdul Azim Mohd Zabidi, Datuk Chai Woon Chet and Wong Kwai Wah.