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Thursday, November 10, 2011

Stocks to watch: Harvest, Hibiscus, SEGi, Guan Chong, Tenaga (Edge)

HARVEST COURT INDUSTRIES BHD [] is expected to be in focus on Thursday, Nov 10 especially after the surge in the share price to multi-year highs amid high volume, prompting Bursa Malaysia Securities to caution investors.

Also in focus could be Hibiscus Petroleum Bhd, SEG INTERNATIONAL BHD [], GUAN CHONG BHD [] and TENAGA NASIONAL BHD [].

Bursa Securities cautioned investors over the recent sharp rise in the price and volume of Harvest shares and warrants.

“Notwithstanding the recent announcements made by the company, Bursa Securities would like to advise investors to exercise caution and to make informed decisions in the trading of Harvest and Harvest-WA,” it said on Wednesday.

Harvest closed up 27 sen to RM1.45 with 24.20 million shares done while the warrants rose 21 sen to RM1.26 with 32.15 million units done. The caution could see speculators taking profit on Thursday.

Also under the watch of Bursa Securities was Hibiscus and Emico Bhd. The regulator had queried the company over the sharp increase in price and high volume of the securities recently.

However, in response to the query, Hibiscus said it was not aware of any factors which may have contributed to the unusual market activity.

It said it had announcement the fulfillment of the Tranche 1 conditions as set out in the share subscription agreement set out on Oct 25 relating to the proposed subscription and proposed acquisition of shares in Lime Petroleum Plc.

Meanwhile, Emico, whose shares and warrants had surged in active trade on Wednesday, said it was unaware of the reasons. Trading was suspended late Wednesday and resumes on Thursday. The warrants surged 23 sen to 30 sen with 11.87 million units done while the shares rose 19.5 sen to 39.5 sen with 89.36 million shares transacted.

SEG International’s earnings rose 66.3% to RM18.32 million in the third quarter ended Sept 30, 2011 from RM11.01 million a year ago, boosted by an increase in student enrolments.

It said on Wednesday, revenue increased by 24.1% to RM69.95 million from RM56.36 million while earnings per share were 3.50 sen versus 2.22 sen.

For the nine-month period, its net profit increased by 74.2% to RM54.57 million from RM31.32 million.

Guan Chong Bhd’s net profit rose 45% to RM25.94 million in the third quarter ended Sept 30, 2011 from RM17.86 million a year ago.

It said on Wednesday that revenue increased by 23.3% to RM365.72 million from RM296.56 million while earnings per share were 8.16 sen versus 5.59 sen.

Guan Chong said the higher turnover was mainly due to higher sales volume of cocoa products as the result of contribution from its Batam plant, which started in February.

Standard & Poor's Ratings Services had revised downwards its outlook on Tenaga Nasional Bhd to negative from stable on weakened profitability.

"We revised the outlook to negative because we expect Tenaga's weakened profitability and higher operating costs to continue to weaken its significant financial risk profile," said S&P credit analyst Rajiv Vishwanathan.

"Our view is based on our anticipation that higher fuel prices stemming from a shortage of gas supply will continue to burden the company's cash flows. Moreover, the company is likely to incur capital expenditure on its hydroelectric and thermal power projects over the next 12 months."

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