The Star Online: Business

KLCI opens slightly lower in cautious trade
MISC under selling pressure
CPI up on increase in food and non-alcoholic beverages index

KLCI opens slightly lower in cautious trade

Posted: 17 Apr 2013 06:16 PM PDT

Published: Thursday April 18, 2013 MYT 9:17:00 AM

KUALA LUMPUR: Malaysia's key stock index, the FBM KLCI fell in early trade on Thursday on profit taking, mirroring the cautious regional markets and after the overnight fall on Wall Street.

At 9am, the KLCI was down 0.58 of a point to 1,719.39, after closing at a record high of 1,710.9 on Wednesday. Turnover was 8.62 million shares valued at RM8.27mil. There were 46 gainers, 52 losers and 65 counters unchanged.

BIMB Securities Research said despite the sell-down on equities in the US and Europe, the local bourse might find some support from the buying momentum although the index may find it hard to proceed further.

"Therefore, we expect the market to consolidate at current level with 1,700 as the psychological support," it said in its market outlook.

Genting Plantations fell 20 sen to RM8.70 with 100 shares done, UMW 10 sen to RM13.40 and IOI Corp seven sen lower at RM5.05 while Genting Malaysia shed four sen to RM3.73. Gamuda was down six sen to RM4.12 and Astro four sen to RM2.86.

Among the consumer stocks, GAB and Nestle lost eight sen each to RM17.70 and RM61.46. Glove maker Top Glove shed six sen to RM6.63 after the strong run-up on Wednesday.

Konsortium gained seven sen to RM1 and Catcha five sen to 48.5 sen while TM added three sen to RM5.53. Among the finance and banking stocks, MBSB gained six sen to RM2.75, MBSB-WA five sen to RM1.72 and AmBank three sen to RM6.53.

MISC under selling pressure

Posted: 17 Apr 2013 06:08 PM PDT

PETALING JAYA: MISC Bhd, which is the subject of a takeover bid by its parent company, saw some selling pressure at below the RM5.50 buyout price, leading to opportunistic investors punting on the stock.

As a result, a whopping 17.09 million shares changed hands at prices ranging from RM5.30 to RM5.46. The counter closed at RM5.37, 1.8% below the RM5.50 price.

Still, investors buying MISC shares were aware of the risk of buying below the buyout price.

"It isn't clear why there's so much selling going on," said one investor, who picked up some four million MISC shares at prices between RM5.36 and RM5.40 individually.

Another investor said that this was an easy wager to make. "If indeed the Employees Provident Fund (EPF) decision is the decisive stroke, then surely this deal would be done at RM5.50. You have a 10-sen difference here, which is about a 1.8% return."

These investors are, therefore, puzzled as to why some shareholders were dumping the stock. To be noted is the fact that the offer expires this Friday.

To recap, on April 11, the EPF, which held the largest minority block at 9.5% in MISC, had accepted Petroliam Nasional Bhd's (Petronas) revised offer of RM5.50.

The national oil company had raised the offer by 20 sen from the original RM5.30 made at end-January, following resistance from the EPF, which had held out for a higher price.

With the EPF's acceptance, Petronas' total shareholding in MISC now stood at 79.77% short of another 10.2% equity interest to touch the required 90% shareholding level for the offer to become unconditional.

Although the EPF has given its support to the deal, there is an off chance that other minority shareholders could rally together to fight for a higher price. MISC's second-largest minority group after the EPF is Permodalan Nasional Bhd (PNB), which has a 6.35% equity interest via its various unit trusts.

In the event PNB does not support the deal and had the support of at least another 3.85% of minority shareholders, then the deal could, theoretically, fail.

However, some investment bankers rule this out and reckon that the Government-linked fund would eventually support the deal. It is noteworthy that PNB has not come out to say how it viewed the MISC buyout offer, even after it had been revised.

MISC's other minority shareholders are the Penang Development Corp and Pacific Mutual Fund Bhd, which hold a 1.3% and 0.09% interest, respectively. They had also previously said that Petronas' offer undervalued the company.

CPI up on increase in food and non-alcoholic beverages index

Posted: 17 Apr 2013 06:04 PM PDT

KUALA LUMPUR: Prices for March as measured by the consumer price index (CPI) rose 1.6% to 106.2 compared with a year ago mainly due to a 3.3% increase in the food and non-alcoholic beverages index.

For the January to March period, the index was up 1.5% to 106.1 on year-on-year basis while compared with February, the index increased by 0.1%.

"The index for food and non-alcoholic beverages and non-food for the month of March 2013 showed increases of 3.3% and 1% respectively as compared to the same month in 2012.

"For the period January to March 2013, the index for food and non-alcoholic beverages and non-food increased by 2.9% and 1% respectively," the Statistics Department said in a statement.

"Compared with the previous month, the index for non-food increased by 0.2% while the index for food and non-alcoholic beverages remained unchanged at 110.2."

Other notable increases among these main groups with high weights were housing, water, electricity, gas and other fuels at 1.3% and transport at 0.6%.

Alliance Research chief economist Manokaran Mottain said in a report that inflationary pressures would be edging up further, moving forward, due to an anticipated recovery in global prices of selected commodities and in view of the impending subsidy rationalisation programme, which would likely be imposed after the general election.

"We maintain our forecast on inflation at 2.5% in 2013, still remaining under control," he said, adding that Bank Negara had made assumptions for this year's inflation on US$100 per barrel for crude oil and RM2,500 per tonne for crude palm oil.

Manokaran said given the low risk of inflation to recovery, the central bank would have more room to keep the country's benchmark overnight policy rate at 3% this year.

Kredit: www.thestar.com.my

Rabu, 17 April 2013