Jan19-Companies in the news DNeX, CIMB Group, EKA Noodles, Ranhill, MBSB, DRB-Hicom, Hap Seng, OWG, Abric, Boustead, Media Prima, CAB Cakaran and Axi

• Companies in the news
  

DNeX, CIMB Group, EKA Noodles, Ranhill, MBSB, DRB-Hicom, Hap Seng, OWG, Abric, Boustead, Media Prima, CAB Cakaran and Axis REIT

By Danial Idraki / theedgemarkets.com   | January 18, 2016 : 11:59 PM MYT

KUALA LUMPUR (Jan 18): Based on corporate announcements and news flows today, companies that may be in focus tomorrow (Tuesday Jan 19) could include: DNeX ([You must be registered and logged in to see this image.] Valuation: 0.50, Fundamental: 3.00), CIMB Group, EKA Noodles, Ranhill, MBSB ( Valuation: 2.55, Fundamental: 1.20), DRB-Hicom, Hap Seng, OWG, Abric, Boustead, Media Prima, CAB Cakaran and Axis REIT ( Valuation: 0.15, Fundamental: 1.50).
Dagang NeXchange Bhd (DNeX) is tapping into the Asian renewable energy market via a memorandum of understanding (MoU) it entered into with three companies. The move forms a part of DNeX's diversification into the energy sector.
In a statement, DNeX said its subsidiary Forward Energy Sdn Bhd signed the MoU with China Everbright International Ltd, Broadgate Engineering (M) Sdn Bhd and HydroChina International Enginnering Co Ltd.
Under the MoU, the parties will collaborate and cooperate specifically in submitting business proposals for waste-to-energy technology projects in Malaysia and regional markets.
CIMB Group Holdings Bhd ([You must be registered and logged in to see this image.] Valuation: 1.65, Fundamental: 0.55) group chief executive officer Tengku Datuk Seri Zafrul Aziz said the group is satisfied with its current capital position and is not looking at initiating any corporate exercise to raise funds.
"We will see a lot of our initiatives regarding capital optimisation come into play," Zafrul told reporters after the grand finale of CIMB ASEAN Stock Challenge 2015 on Monday.
Meanwhile, on the reported retrenchment of 32 staff members in CIMB's Hong Kong investment banking and equities operations, Zafrul said it was due to very tough capital market condition across Asia, especially in Hong Kong itself.
"But we are not planning on doing any more MSS in Malaysia, nor in Indonesia. The focus this year will be looking at improving our productivity, and continuing our T18 (Target 2018, CIMB Group's Mid Term Strategy Statement) agenda. In short, there will be no more MSS nor retrenchment," he said.
Rice vermicelli manufacturer EKA Noodles Bhd ([You must be registered and logged in to see this image.] Valuation: 0.00, Fundamental: 0.35) has entered into an MoU with Anhui HuiJia Biological Science and Technology Co Ltd (HuiJia), a company based in Anhui Province, China, for the transfer of technology for the production of liquid fructose.
In a bourse filing, EKA said the MoU also includes the extraction of rice protein powder from its by-product, subject to commercial feasibility and financial viability studies to be conducted.
"The estimated cost and production capacity of the proposed production line will be determined upon completion of the relevant studies," read the group's announcement.
Ranhill Holdings Bhd plans to operate a wastewater treatment plant for Maoping Industrial Park in the Yongxin County, Jiangxi Province in China, through the incorporation of Ranhill (Yongxin) Water Co Ltd.
Ranhill said its indirect subsidiary, Ranhill Water Hong Kong Ltd (RWHK), has formed Ranhill (Yongxin) in China on Jan 15, 2016. Ranhill (Yongxin) is deemed a wholly-owned subsidiary of RWHK.
Ranill (Yongxin), which has yet to commence its business, will principally undertake the design, construction and operation of the wastewater treatment plant.
Bank Negara Malaysia has "no objection" to the one-month extension up till Feb 2 that is being sought by Malaysia Building Society Bhd (MBSB) and DRB-Hicom Bhd ([You must be registered and logged in to see this image.] Valuation: 2.00, Fundamental: 0.00) to conclude their talks on the proposed merger between MBSB and Bank Muamalat Malaysia Bhd.
DRB-Hicom owns 70% of Bank Muamalat, while Khazanah Nasional Bhd holds the remaining 30% stake.
In a filing with Bursa Malaysia, AmInvestment Bank, on behalf of MBSB, said Bank Negara Malaysia, via its letter dated Jan 15, had informed MBSB of its position in response to MBSB's application for the time extension.
Hap Seng Consolidated Bhd ([You must be registered and logged in to see this image.] Valuation: 2.10, Fundamental: 1.30) plans to acquire plywood trader Lei Shing Hong Wood Products Ltd (LSHWP) for US$3.22 million (RM14.2 million) to expand its fertiliser division.
LSHWP is involved in general trading and trading of plywood and Hap Seng expects to complete the acquisition in two months.
The group said the proposed acquisition will enable the fertilisers division to source fertilisers directly from fertiliser manufacturers in China.
This will enable the division to have better control over the cost, quality and supply of fertilisers, it said, adding the acquisition will also expand its fertiliser trading business in China.
Only World Group Holdings Bhd ([You must be registered and logged in to see this image.] Valuation: N/A, Fundamental: N/A) (OWG) has proposed a private placement of up 10% of its total issued and paid-up share capital, which could raise about RM50.17 million, based on an indicative issue price of RM2.26 sen apiece, to fund its Komtar Tower revitalisation project.
The food service and amusement park operator said the exercise, comprising up to 22.2 million shares, will be issued to independent third party investors to be identified later.
OWG said the placement shares will be priced at a discount of not more than 10% to the five-day volume weighted average market price of its shares immediately preceding the price fixing date.
According to the group, RM48 million from the gross proceeds it expects to raise will be set aside to fund part of the expansion cost related to Komtar Tower's revitalisation project, which amounts to approximately RM180 million.
The remaining cost of the Komtar Tower revitalisation project will be funded via internally generated funds and bank borrowings, it added.
Practice Note 16 company Abric Bhd ([You must be registered and logged in to see this image.] Valuation: 3.00, Fundamental: 1.35) has proposed a cash distribution of 43 sen per ordinary share, and to exit Bursa Malaysia's Main Market.
In a bourse filing on Monday, Abric said the cash distribution is to be implemented via a capital reduction and repayment exercise, and a special cash dividend, the ratio of which is yet to be fixed at this juncture.
The proposed distribution and delisting will involve up to RM63.9 million, which it intends to fund with its existing cash reserves, including its cash reserves placed in its custodian account. As at Dec 31, 2015, Abric has cash and bank balances amounting to RM69.9 million, of which RM64.8 million is placed in the custodian account.
Boustead Holdings Bhd ([You must be registered and logged in to see this image.] Valuation: 2.00, Fundamental: 0.65) is looking to raise up to RM1.05 billion via a two-for-five rights share issue to pare down its gearing, fund its property development and property investment activities, and for working capital.
The group also proposed to give out two bonus shares for every five of Boustead shares held after the proposed rights issue.
Boustead said the issue price for the rights share, which entails an issue of up to 413.67 million new shares, will be determined based on a discount of 30% to the theoretical ex-rights price, which will be based on the volume-weighted average market price of Boustead shares to be determined.
In a bourse filing, the group said over half the proceeds of the rights issue, or RM507 million, will be used for property development activities, while RM486 million will be used to repay bank borrowings.
As at Sept 30, 2015, its outstanding bank borrowings was RM7.96 billion, which would be reduced to RM7.47 billion on completion of the proposed rights issue and the repayment of RM486 million.
Media Prima Bhd ([You must be registered and logged in to see this image.] Valuation: 2.00, Fundamental: 1.95)'s wholly-owned unit, Sistem Televisyen Malaysia Bhd (STMB) has entered into an agreement with Korean firm CJ O Shopping Co Ltd to establish a joint venture (JV) company to venture into the home shopping business.
The joint venture is a business-to-consumer (B2C) venture and is expected to provide Media Prima the opportunity to gain lucrative consumer revenue, while expanding the group's portfolio to include retailing business, which is expected to contribute positively to earnings, according to Media Prima's bourse filing today.
The shareholding structure of the JV company shall be 51% STMB and 49% CJ O. The JV company's capitalisation shall be RM65 million, to be contributed by the two companies in proportion to their stake in the JV company, in several tranches.
Penang-based poultry farmer CAB Cakaran Corp Bhd ([You must be registered and logged in to see this image.] Valuation: 1.10, Fundamental: 0.55) has proposed to undertake a private placement of 15.06 million new shares, representing a substantial 9.1% stake, to Indonesia's Salim Group for RM31.18 million or RM2.07 per placement share.
The issue price of RM2.07 represents a premium of 26.22% to the five-day weighted average market price of CAB shares up to and including Jan 15.
CAB said it has entered into a placement agreement with Plant Wealth Holdings Ltd, a company controlled by KMP Investments Pte Ltd, which in turn is 67% owned by Salim Group chairman, Anthoni Salim.
The Edge Financial Daily had on Dec 7 last year reported that the Salim Group could be eyeing as much as a 20% stake in CAB Cakaran, as the two companies were understood to be in talks for quite some time.
Axis Real Estate Investment Trust (Axis REIT) saw its net property income in its latest quarter ended Dec 31, 2015 (4QFY15) rise 9.8% to RM32.75 million from RM29.84 million a year ago, largely on higher realised property income, which rose 15.9% to RM39.83 million.
The realised property income recorded by the industrial/office-space-focused REIT in the previous year's corresponding period was RM34.37 million, its bourse filing today showed.
The REIT also proposed a dividend per unit (DPU) of 2 sen for 4QFY15, payable on Feb 29, 2016, compared with 2.08 sen in the previous corresponding period, bringing its full year FY15 DPU declared to 8.40 sen compared with 9.88 sen in FY14.
Net income in 4QFY15, however, fell 35% to RM16.95 million from RM26.08 million in 4QFY14, largely due to expenses and a change in fair value of its investment properties.
For the full year (FY15), its net income was 12.6% lower at RM96.56 million compared with RM110.46 million in FY14, even though revenue was 18% higher at RM163.82 million from RM138.84 million.
(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)