FBMKLCI 1541.03 DJ-93.28 CRUDE OIL 99.53 RM 2.9870

BURSA Malaysia is likely to be lower this week with the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) expected to drift between 1,530 and 1,540-point level. Affin Investment Bank head of retail research, Dr Nazri Khan, said rising inflation, the start of interest rates upcycle, the unexpected commodity bubble burst and the uninspiring overnight session on Wall Street were likely to be important forces to influence the broad market's direction. The economic situation also remains uncertain for the Group of 3 (US, Europe and Japan) following the untimely resignation of International Monetary Fund chief last week. However, he said, the local market was likely to find footing from stable ringgit, oil and gold price. Nazri said the local market was also likely to get support from the potential listing of Felda Sugar, the launching of Financial Sector Master Plan and the start of the third round of banking consolidation next month. Further, the news that the local giant construction MMC Corp planned to list its energy and port units, with an estimated market capitalisation of up to RM14bil, would also create some excitement, he said.

Mah Sing Group Bhd will launch RM2.5bil to RM3bil worth of projects in the Klang Valley, Penang and Johor this year to meet its sales target of RM2bil for the current financial year ending Dec 31. Group managing director and chief executive Tan Sri Leong Hoy Kum said the projects would comprise an array of commercial, residential and industrial properties.

Analysts still bearish on sector due to weak global chip sales

PETALING JAYA: Research analysts are still bearish on the semiconductor sector in the country.

Last month, analysts downgraded their calls on Malaysian Pacific Industries Bhd (MPI) and Unisem (M) Bhd following weaker-than-expected financial numbers for the first quarter of this year. Research houses said the earnings of both semiconductor companies were impacted due to inventory adjustment among clients following a supply pile-up in the second half of 2010. TA Securities Research recently downgraded the semiconductor sector from “neutral” to “underweight”. “We foresee global chip sales remaining weak in the second quarter of this year as many semi-device makers are moderating production after the earthquake in Japan,” said the report. The continuous strengthening of the ringgit against the US dollar will be tough for local semiconductor manufacturers as revenue is denominated in the US dollar, according to the report.

Melati Ehsan was awarded a RM148.63 million project from the Public Works Department to build a road stretching from Gua Musang in Kelantanf to Kampung Relong in Pahang. Melati’s unit Pembinaan Kery Sdn Bhd accepted a letter of award from the PWD for the road CONSTRUCTION [] project which starts on June 15 this year until Dec 10, 2013.

TSH Resources has allocated RM100 million or more per year as PLANTATION [] development capital expenditure (capex) for new planting of oil palm trees, the bulk of which will in Kalimantan, Indonesia. Bulk of the RM100 million capex would be for new planting in Kalimantan where it has about 58,000 ha of land which is still unplanted. The Indonesian operations, with the trees maturing by next year, would underpin TSH’s fresh fruit bunches output, productivity and revenue.

KPJ Healthcare reported a set of unimpressive earnings at RM27.51 million in the first quarter ended March 31, 2011 (1QFY2011) compared with RM27.24 million a year ago. Revenue rose 16.4% to RM437.75 million from RM376.04 million a year ago while earnings per share were 5.09 sen compared with 5.19 sen. It declared 2.4 sen dividend per share. However, KPJ expected the group’s performance would continue to improve in line with increasing demand, hospital capacity and activities.

MK Land Holdings Bhd’s net profit rose more than two-fold to RM7.22 million in the third quarter ended March 31 versus RM2.02 million a year ago, underpinned by its strong property performance. Revenue rose to RM165.15 million from RM94.74 million. Net asset per share was 87 sen.

Can-One Bhd has taken court action KIAN JOO CAN FACTORY BHD [] over the latter’s proposed one-for-two bonus issue and the proposed renounceable rights issue of 166.56 million 2five-year warrants 2011/2016 on the basis of one warrant for every four KJCF shares held after the proposed bonus. Can-One claimed the proposals breached the rights of Can-One under the shares sales agreement dated March 13, 2009 and in breach of the Order of the Court of Appeal dated Aug 25, 2010 and the order of the Federal Court dated Feb 21, 2011.

The Edge weekly reports that crane manufacturer Handal Resources has been on an expansion trail since it was listed two years ago, and the strategy has borne fruit.