The Star Online: Business
The Star Online: Business |
- RAM Ratings: Malaysia economy to grow 5.3% in 2013
- TMC: Peter Lim unaware of plan to inject a hospital into the company
- Weak demand to weigh on CSC Steel's earnings
| RAM Ratings: Malaysia economy to grow 5.3% in 2013 Posted: 30 Jan 2013 06:40 PM PST KUALA LUMPUR: RAM Ratings expects Malaysia's economy to expand by 5.3% in 2013 and pick up pace to 5.8% in 2014, underpinned by robust demand and recovery of the external environment. In its Economic Outlook report issued on Thursday, the ratings agency said domestic private consumption was anticipated to record healthy growth due to favourable labour-market conditions, aided by a slew of government initiatives and handouts. As for global conditions, RAM Ratings expected a gradual recovery this year "as policymakers in systemically important economies adopt an accommodative stance in an attempt to combat their respective structural deficiencies". On the domestic front, it expected healthy growth in private consumption, supported by favourable labour market conditions following the government's initiatives and handouts. RAM Ratings also expected private investment to expand further, supported by the improved business environment and relatively accommodating interest rates. "While fiscal policy remains supportive of economic activity, the growth of public expenditure should moderate to meet the government's longer-term fiscal-consolidation objectives and as the 'public-private partnership' method of financing has assumed a larger role in funding various development projects," it said. The ratings agency also expected Malaysia's exports to improve, in line with the revival of certain advanced economies. It expected domestic monetary and financial conditions to remain relatively stable this year. On the Overnight Policy Rate, it said Bank Negara Malaysia was "likely to adjust the upwards by 25 to 50 basis points this year", in response to persistent domestic credit growth and as longer-term inflationary pressures begin to develop. On the ringgit, RAM Ratings said the local currency retained considerable upside potential because of its strong fundamentals. In its outlook for the domestic bond market, RAM Ratings expected it to strengthen in 2013, with estimated gross issuances by the government at RM90bil to RM95bil. It expected the private debt securities to be around RM95bil to RM100bil. "The authorities' supportive fiscal stance and improvements in the domestic business environment will continue underscoring market activity," it said. |
| TMC: Peter Lim unaware of plan to inject a hospital into the company Posted: 30 Jan 2013 06:32 PM PST PETALING JAYA: TMC Life Sciences Bhd said its major shareholder Singapore billionaire Peter Lim was not aware of a plan to inject a hospital into the company as reported by a local weekly. In a filing with Bursa Malaysia, TMC Life said the board did not receive any notification of Lim's plan of injecting the Iskandar hospital into TMC Life. On Monday, a business weekly reported that TMC Life would add a S$200mil (RM499mil) hospital under its name in Iskandar Malaysia's medical hub. The report said Lim was looking at putting a 200-bed hospital that was being constructed in the area, under TMC Life's management. It also added that the executives were uncertain at that point in time if the company would own the S$200mil hospital. The news report also said the hospital, which is to be completed by 2015, was expected to be the catalyst for the growth of the medical hub. Meanwhile, on Jan 19, it was reported that Tan Sri Vincent Tan had increased his stake in TMC Life to 32.27% from 31.06% in the previous month, via Berjaya Corp Bhd. This brought his stake closer to TMC Life's major shareholder Lim's stake at 32.59%. If either shareholder hit the 33% mark, they would be required to make a mandatory general offer for the remaining shares in TMC Life. Yesterday, TMC Life's shares rose to an intraday high at 38.5 sen. However, the counter closed 1 sen lower to 37 sen at 5pm. At closing, about 1.6 million shares exchanged hands. |
| Weak demand to weigh on CSC Steel's earnings Posted: 30 Jan 2013 06:00 PM PST KUALA LUMPUR: Hong Leong Investment Bank (HLIB) Research expects weak demand and low hot rolled coil feedstock for CSC Steel's products to continue to weigh on CSC Steel's fourth quarter earnings (Q4, 2012). It said on Thursday CSC Steel's the Q412 earnings would be 10%-15% weaker versus Q3, 2012 to RM5.3mil to RM5.6mil, making up the full-year earnings to RM27.7mil to RM28mil. Its projected full-year net profit was RM30.8mil. HLIB Research said despite the expected weak earnings, it believes CSC would likely maintain its generous dividend payout, which is close to 100% of its 2012 net profit, given its strong balance sheet (with net cash of 66.3 a share as at Sept 30, 2012). It said based on its revised projected 2012 net profit, it expected a net dividend per share of 7.0 sen versus 8.0 sen previously for 2012, translating to a decent dividend yield of 6.0%. "Although the recent global steel price recovery (which started since December 2012) may help boosting CSC Steel's near-term earnings, we remain cautious on CSC's medium-term outlook as concerns on overcapacity in China will continue to linger," added the research house. HLIB lowered its 2012-14 net profit forecasts by 0.4% to 15% to RM28mil, RM33.8mil and RM47.7mil respectively, largely to account for lower earnings before interest and tax margin assumptions. |
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