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Thursday, February 24, 2011

Stocks to watch: Genting, IJM, Axiata, TSH, Kossan, Transmile (Edge)

Stocks on Bursa Malaysia could continue to see cautious trade on Thursday, Feb 24 as sentiment continues to be dampened by the weak overnight close on Wall Street, surge in oil prices and unrest in oil producer Libya.

On Wall Street, US stocks dropped for a second straight session on Wednesday as Libya's violence sent oil prices up briefly to $100 a barrel and tech shares sank, adding credence to calls for a market correction.

Reuters reported oil futures jumped to their highest since October 2008 amid worries about supply disruptions in Libya, a top oil producer. Late in the day, oil eased off the day's highs, helping stocks trim losses.

The Dow Jones industrial average fell 107.01 points, or 0.88 percent, at 12,105.78. The Standard & Poor's 500 Index lost 8.04 points, or 0.61 percent, to 1,307.40. The Nasdaq Composite Index declined 33.43 points, or 1.21 percent, to 2,722.99.

Stocks to watch on Bursa Malaysia after the barrage of corporate results include GENTING BHD [], IJM Corp Bhd, Axiata Group Bhd, TSH RESOURCES BHD [], KOSSAN RUBBER INDUSTRIES BHD [] and TRANSMILE GROUP BHD [].

The Edge FinancialDaily reports that PLUS Expressway Bhd, the country's biggest toll road operator, obtained its shareholders' approval yesterday for the RM23 billion takeover bid by its major shareholders UEM Group Bhd and the Employees Provident Fund (EPF), despite over 100 minority shareholders claiming the EGM was "illegal" and walking out halfway.

The Edge FinancialDaily reports that brownfield oil and gas outfit PETRA ENERGY BHD [] is likely to post losses for the fourth quarter of 2010 even with crude oil prices around US$100 again.

Also in The Edge FinancialDaily is the report that Malaysia's inflation rose 2.4% year-on-year (y-o-y) in January on the back of higher costs of food, transport and utilities. It is higher than December's 2.2% and the highest in 20 months.

Genting Bhd’s net profit surged 89.6% to RM465.43 million in the fourth quarter ended Dec 31, 2010 from RM245.4 million a year ago.

Revenue rose 76% to RM4.086 billion from RM2.320 billion. Earnings per share were 12.57 sen compared with 6.64 sen while it proposed a final dividend of 4.5 sen.

It said the higher revenue was mainly from the leisure and hospitality division with the commencement of operations of Resorts World Sentosa in Singapore, during the first quarter of 2010.

As for FY10, its earnings rose 110.9% to RM2.202 billion from RM1.044 billion while revenue surged 71% to RM15.194 billion from RM8.893 billion. Group revenue rose by 71% to record a new high of RM15.19 billion in FY2010 (FY2009: RM8.89 billion), while group profit before tax rose by 74% to post a new high of RM4.39 billion in FY2010 (FY2009: RM2.53 billion).

IJM Corp’s earnings rose 58% to RM132.19m in the third quarter ended Dec 31, 2010 from RM83.64 million a year ago, boosted by its property and PLANTATION []s sector. Revenue dipped 3.7% to RM901.34 million from RM936.31 million. Earnings per share were 9.78 sen compared with 6.32 sen. IJM said the lower revenue was mainly due to mainly to the CONSTRUCTION [] and property divisions.

Axiata posted net loss of RM367.04 million in the fourth quarter ended Dec 31, 2011 compared with a net profit of RM558.28 million a year ago, mainly due to impairment recorded in the current quarter.

Group loss after tax was RM260.8 million, down by 143.3% from profit after tax of RM602.4 million reported in 4Q09.Operating revenue was RM4.016 billion compared with RM3.755 billion a year ago.

For FY10, it posted net profit of RM1.77 billion which was attributable to the owners of the company versus RM1.65 billion in FY09. Profit after tax was RM2.116 billion compared with RM1.756 billion in FY09.

TSH Resources’ earnings surged 116% to RM44.22 million in the fourth quarter ended Dec 31, 2010 from RM20.47 million, boosted by the robust performance of its Indonesian plantation. It said this was despite revenue had declined by 12.8% to RM247.44 million from RM283.88 million. Earnings per share were 10.8 sen compared with 5.01 sen. The board recommended a final single tier dividend of six sen for 2010.

Kossan’s net profit for the fourth quarter ended Dec 31, 2010 rose 21.4% to RM29.45 million from RM24.25 million a year ago, driven by the expansion in the company’s gloves division with better product mix and margin.

Revenue rose 11% to RM252.97 million from RM227.75 million. Earnings per share were 9.18 sen while net assets per share was RM1.40.

For the financial year ended Dec 31, 2010, Kossan’s net profit recorded an increase of 76.1% to RM118.59 million from RM67.33 million a year ago. Revenue rose 24.6% to RM1.05 billion from RM842.14 million.

Tan Chong’s net profit for the fourth quarter ended Dec 31, 2010 rose 21.8% to RM52.07 million from RM42.73 million a year earlier, boosted by across the board price discounting to clear 2010 inventories ahead of new model introductions in 2011.

Revenue for the quarter rose 16% to RM835.36 million from RM720.19 million a year ago. Earnings per share were 7.98 sen, while net assets per share was RM2.57.

Beleaguered Transmile Group Bhd faces suspension with effect from March 3 and delisting on March 7 for failing to submit a regularisation plan to the regulators for approval by Feb 22.

Transmile failed to submit the revamp plan to Securities Commission or Bursa Malaysia Securities by the Feb 22 deadline. However, it has until March 2 to submit an appeal to Bursa Securities

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