Ringgit a favorite pick of Morgan Stanley
Published: 2010/12/10
Malaysian ringgit and Singapore dollar are likely to outperform among Asian currencies next year, say Morgan Stanley strategists in research note.
They added that one of their top 2011 FX trade ideas is long MYR/JPY with target of Y29.0, about 8.6 per cent above current level near Y26.70.
“SGD and MYR are our favourite picks in Asia, as both are great reflation trades ... and both have hawkish central banks, strong economic fundamentals and very healthy balance of payments positions.”
Morgan Stanley economists see growth in Asia ex-Japan reaching 8.2 per cent in 2011, slowing only moderately from 9.5 per cent expected for 2010.
Another plus for MYR is potential benefits from rising commodity prices, since Malaysia is the only net commodity exporter in the region, say the strategists, who think INR, THB and IDR look overvalued and may lag in 2011 among Asian currencies.
Risks to Asian currencies include global “risk-off” events, potential for lagged policy responses to regional inflation and risk of more capital controls, they add. -- Reuters
Read more: Ringgit a favorite pick of Morgan Stanley http://www.btimes.com.my/Current_News/BTIMES/articles/20101210102032/Article/index_html#ixzz17hWyBjT4
Friday 10 December 2010
Maybank's international operations expected to contribute 40% to group's net profit by 2015
Friday December 10, 2010
Maybank told to sell down stake in Indonesian bank
By LEONG HUNG YEE
hungyee@thestar.com.my
PETALING JAYA: Malayan Banking Bhd's (Maybank) Indonesia unit, PT Bank Internasional Indonesia (BII), saw its shares jump to a 10-year high amid comments by the country's regulator that Maybank refloat a 20% stake in BII within six months.
BII's shares surged 25% yesterday to 1,010 rupiah a piece. Its share price has also appreciated by more than 215% year-to-date.
Yesterday, Bloomberg quoted Indonesia capital market regulator chairman Ahmad Fuad Rahmany who said that Maybank needed to fulfil its sell-down requirement and complete the exercise by June 1, 2011.
Maybank acquired BII in 2008 for RM7.9bil and holds a 97.5% stake. Maybank said last Friday that it had received a letter from the Indonesian Regulatory Authority for Indonesian Capital Market (Bapepam) that gave it an extension of time to June 1, 2011 to complete its sell-down.
But Maybank added then that it may request for further extension if the sell-down exercise would result in it incurring a potential loss in excess of 10% of its original value of the BII acquisition.
While analysts said Maybank could potentially realise a gain from the sale of the 20% stake given the high share price of BII, the problem is likely to be finding potential buyers willing to pay such a high price.
PT Ciptadana Securities head of sales John Teja was quoted by Bloomberg as saying the shares rose on expectation Maybank would sell the stake at a higher price.
MIMB Investment Bank research head Chan Ken Yew said it was a definitely good deal if Maybank could sell its stake at such a high price.
He said Maybank paid a book value of four times when it bought the bank but said that BII's current market price was around 9.9 times its book value.
A local bank-backed head of research said that despite the lofty price of BII, it should be noted that Maybank did a huge write down after the take-over.
He also said that the main reason why Maybank has delayed its sell down of BII shares was because it has not found a buyer willing to pay a price around the current trading price of BII.
It is not easy to find a buyer. Furthermore, I think the Indonesian regulator may not want another Malaysian entity to take up such a big block in BII. Hence Maybank is likely to be looking for an Indonesian partner that could potentially add value to BII, but that's whats taking time, he said.
It is likely that Maybank will place out the shares either to one entity or a group of insitutions. Maybank expects its international operations from countries such as Singapore and Indonesia to contribute 40% to the group's net profit by 2015.
For the nine months ended Sept 30, BII posted a net profit of 415 billion rupiah (US$47mil) despite an earlier significant impairment charge in 2009.
This marked a significant turnaround from a net loss of 183 billion rupiah (US$19mil) in the same period last year.
http://biz.thestar.com.my/news/story.asp?file=/2010/12/10/business/7594718&sec=business
Maybank told to sell down stake in Indonesian bank
By LEONG HUNG YEE
hungyee@thestar.com.my
PETALING JAYA: Malayan Banking Bhd's (Maybank) Indonesia unit, PT Bank Internasional Indonesia (BII), saw its shares jump to a 10-year high amid comments by the country's regulator that Maybank refloat a 20% stake in BII within six months.
BII's shares surged 25% yesterday to 1,010 rupiah a piece. Its share price has also appreciated by more than 215% year-to-date.
Yesterday, Bloomberg quoted Indonesia capital market regulator chairman Ahmad Fuad Rahmany who said that Maybank needed to fulfil its sell-down requirement and complete the exercise by June 1, 2011.
Maybank acquired BII in 2008 for RM7.9bil and holds a 97.5% stake. Maybank said last Friday that it had received a letter from the Indonesian Regulatory Authority for Indonesian Capital Market (Bapepam) that gave it an extension of time to June 1, 2011 to complete its sell-down.
But Maybank added then that it may request for further extension if the sell-down exercise would result in it incurring a potential loss in excess of 10% of its original value of the BII acquisition.
While analysts said Maybank could potentially realise a gain from the sale of the 20% stake given the high share price of BII, the problem is likely to be finding potential buyers willing to pay such a high price.
PT Ciptadana Securities head of sales John Teja was quoted by Bloomberg as saying the shares rose on expectation Maybank would sell the stake at a higher price.
MIMB Investment Bank research head Chan Ken Yew said it was a definitely good deal if Maybank could sell its stake at such a high price.
He said Maybank paid a book value of four times when it bought the bank but said that BII's current market price was around 9.9 times its book value.
A local bank-backed head of research said that despite the lofty price of BII, it should be noted that Maybank did a huge write down after the take-over.
He also said that the main reason why Maybank has delayed its sell down of BII shares was because it has not found a buyer willing to pay a price around the current trading price of BII.
It is not easy to find a buyer. Furthermore, I think the Indonesian regulator may not want another Malaysian entity to take up such a big block in BII. Hence Maybank is likely to be looking for an Indonesian partner that could potentially add value to BII, but that's whats taking time, he said.
It is likely that Maybank will place out the shares either to one entity or a group of insitutions. Maybank expects its international operations from countries such as Singapore and Indonesia to contribute 40% to the group's net profit by 2015.
For the nine months ended Sept 30, BII posted a net profit of 415 billion rupiah (US$47mil) despite an earlier significant impairment charge in 2009.
This marked a significant turnaround from a net loss of 183 billion rupiah (US$19mil) in the same period last year.
http://biz.thestar.com.my/news/story.asp?file=/2010/12/10/business/7594718&sec=business
Thursday 9 December 2010
Investment guru Rogers bets the farm as he shuns Wall Street
Investment guru Rogers bets the farm as he shuns Wall Street
December 8, 2010 - 10:15AM
Investor guru Jim Rogers says life on the farm will bring far more riches in coming years than the trenches of Wall Street.
Rogers, a commodities evangelist for more than a decade, has tweaked his pitch, saying the producers of the world - whether individuals, companies or countries - will become the new growth sector.
In short, Rogers told the Reuters 2011 Investment Outlook Summit in New York, being productive, saving the fruits of your labor, and owning hard assets hold the keys to a bright future.
"All these people who got MBAs made a mistake. The city of London and Wall Street are not going to be great places to be in the next two or three decades. It's going to be the people who produce real goods," he said.
"Throughout history we've had long periods when the financial centers were in charge. But we've also had long periods when people who produced real goods were in charge - the farmers and the miners," Rogers said.
Rogers, who rose to prominence after co-founding the now defunct Quantum Fund with billionaire investor George Soros some four decades ago, railed about the fiscal irresponsibility of debtor governments and praised China and other Asian countries because they save, work hard and invest in the roads, schools and factories that beget tangible wealth.
As an example, he said that commodity- and mineral-rich Canada will fare far better than Belgium, the seat of European bureaucracy.
Rogers still touts commodities, despite a recent price surge. Even with the benchmark Reuters-Jefferies CRB index of 19 commodities hitting its highest level on Tuesday since October 2008, Rogers said commodities will continue to soar over the next decade.
"They're very high, but they're going to be much, much higher over the next decade. Even I'm going to be stunned, and I'm the bull," he said.
Spot gold hit an all-time high at $US1430.95 an ounce on Tuesday, benchmark copper hit a record peak at $9,044 a tonne in London and US crude rose above $US90 a barrel for the first time in 26 months, before all turned lower.
A year ago at the Reuters Investment Outlook Summit, Rogers said investors in oil, metals and grains should not sweat sell-offs in those markets because the printing of money by governments across the globe would push prices higher.
Rogers reiterated on Tuesday that politicians are afraid to bite the fiscal bullet and will opt to debase their country's currency. He called the Chinese renminbi the world's safest currency and again said gold would eventually rise above $US2000 an ounce.
A bubble might exist in housing in China's coastal cities, but he called it a price bubble and not harmful like the credit bubble that was behind the US housing debacle.
"We had a credit bubble here, perhaps the biggest credit bubble in the whole world," he said. "That kind of huge credit bubble certainly is different than a price bubble. If people go bankrupt in China, it's not going to bring down the Chinese economy."
More currency crises loom, and creditor nations - China, South Korea, Japan, Thailand, Taiwan and Singapore - will thrive, he said.
Rogers singled out the United Kingdom as vulnerable to hard times, and said the pound would underperform the euro over the next five years.
The United States also faces difficulties.
"The way you build an economy, a thriving economy is you save and invest," he said. "Productive capacity is what leads to long-term growth of the economy. You don't build an economy by going to the disco every night."
Reuters
December 8, 2010 - 10:15AM
Investor guru Jim Rogers says life on the farm will bring far more riches in coming years than the trenches of Wall Street.
Rogers, a commodities evangelist for more than a decade, has tweaked his pitch, saying the producers of the world - whether individuals, companies or countries - will become the new growth sector.
In short, Rogers told the Reuters 2011 Investment Outlook Summit in New York, being productive, saving the fruits of your labor, and owning hard assets hold the keys to a bright future.
"All these people who got MBAs made a mistake. The city of London and Wall Street are not going to be great places to be in the next two or three decades. It's going to be the people who produce real goods," he said.
"Throughout history we've had long periods when the financial centers were in charge. But we've also had long periods when people who produced real goods were in charge - the farmers and the miners," Rogers said.
Rogers, who rose to prominence after co-founding the now defunct Quantum Fund with billionaire investor George Soros some four decades ago, railed about the fiscal irresponsibility of debtor governments and praised China and other Asian countries because they save, work hard and invest in the roads, schools and factories that beget tangible wealth.
As an example, he said that commodity- and mineral-rich Canada will fare far better than Belgium, the seat of European bureaucracy.
Rogers still touts commodities, despite a recent price surge. Even with the benchmark Reuters-Jefferies CRB index of 19 commodities hitting its highest level on Tuesday since October 2008, Rogers said commodities will continue to soar over the next decade.
"They're very high, but they're going to be much, much higher over the next decade. Even I'm going to be stunned, and I'm the bull," he said.
Spot gold hit an all-time high at $US1430.95 an ounce on Tuesday, benchmark copper hit a record peak at $9,044 a tonne in London and US crude rose above $US90 a barrel for the first time in 26 months, before all turned lower.
A year ago at the Reuters Investment Outlook Summit, Rogers said investors in oil, metals and grains should not sweat sell-offs in those markets because the printing of money by governments across the globe would push prices higher.
Rogers reiterated on Tuesday that politicians are afraid to bite the fiscal bullet and will opt to debase their country's currency. He called the Chinese renminbi the world's safest currency and again said gold would eventually rise above $US2000 an ounce.
A bubble might exist in housing in China's coastal cities, but he called it a price bubble and not harmful like the credit bubble that was behind the US housing debacle.
"We had a credit bubble here, perhaps the biggest credit bubble in the whole world," he said. "That kind of huge credit bubble certainly is different than a price bubble. If people go bankrupt in China, it's not going to bring down the Chinese economy."
More currency crises loom, and creditor nations - China, South Korea, Japan, Thailand, Taiwan and Singapore - will thrive, he said.
Rogers singled out the United Kingdom as vulnerable to hard times, and said the pound would underperform the euro over the next five years.
The United States also faces difficulties.
"The way you build an economy, a thriving economy is you save and invest," he said. "Productive capacity is what leads to long-term growth of the economy. You don't build an economy by going to the disco every night."
Reuters
Wednesday 8 December 2010
OSK maintains its ''buy'' call on Pos Malaysia, target price of RM4.33
Pos earnings forecasts revised upward
Published: 2010/12/08
OSK Research has revised upwards Pos Malaysia Bhd's earnings forecast by eight per cent for financial year 2010 (FY10) and two per cent for FY12 while keeping FY11's intact.
In a research note today, OSK said the revision was prompted by Pos Malaysia's better-than-expected volume for the first nine months of this financial year following postal rate increase.
"It recorded a decline of only 5.4 per cent as opposed to our full-year expectations of a fall of 10.7 per cent," it said.
OSK said Pos Malaysia Bhd's transformation plan remained intact though impact to earnings would be marginal for next year.
It said the excitement over the unlocking of Pos Malaysia's land bank value remained in place as the Postal Land Act was scheduled to be tabled in Parliament this month.
"We foresee the relaxation on land bank usage will go through as it would make economic sense for the government to maximise the potential value of these land bank scattered nationwide.
"Currently, the land bank (of over 600 outlets) is restricted to offering postal-related services," it said.
The research firm said the relaxation on the usage would act as a key catalyst for Pos Malaysia.
"This will unlock the value potential of its land bank noting that other national postal service providers overseas have already leveraged on their postal branches by combining other forms of commercial activities such as supermarkets, banks and restaurants," it said.
It said other possible amendment of the Postal Land Act could also see Pos Malaysia expanding its foray into franchising its post offices to boost entrepreneurial activities among its employees and the unemployed.
OSK said it would maintain its ''buy'' call on Pos Malaysia with unchanged target price of RM4.33. -- Bernama
Read more: Pos earnings forecasts revised upward http://www.btimes.com.my/Current_News/BTIMES/articles/20101208145455/Article/index_html#ixzz17VMcAILo
Published: 2010/12/08
OSK Research has revised upwards Pos Malaysia Bhd's earnings forecast by eight per cent for financial year 2010 (FY10) and two per cent for FY12 while keeping FY11's intact.
In a research note today, OSK said the revision was prompted by Pos Malaysia's better-than-expected volume for the first nine months of this financial year following postal rate increase.
"It recorded a decline of only 5.4 per cent as opposed to our full-year expectations of a fall of 10.7 per cent," it said.
OSK said Pos Malaysia Bhd's transformation plan remained intact though impact to earnings would be marginal for next year.
It said the excitement over the unlocking of Pos Malaysia's land bank value remained in place as the Postal Land Act was scheduled to be tabled in Parliament this month.
"We foresee the relaxation on land bank usage will go through as it would make economic sense for the government to maximise the potential value of these land bank scattered nationwide.
"Currently, the land bank (of over 600 outlets) is restricted to offering postal-related services," it said.
The research firm said the relaxation on the usage would act as a key catalyst for Pos Malaysia.
"This will unlock the value potential of its land bank noting that other national postal service providers overseas have already leveraged on their postal branches by combining other forms of commercial activities such as supermarkets, banks and restaurants," it said.
It said other possible amendment of the Postal Land Act could also see Pos Malaysia expanding its foray into franchising its post offices to boost entrepreneurial activities among its employees and the unemployed.
OSK said it would maintain its ''buy'' call on Pos Malaysia with unchanged target price of RM4.33. -- Bernama
Read more: Pos earnings forecasts revised upward http://www.btimes.com.my/Current_News/BTIMES/articles/20101208145455/Article/index_html#ixzz17VMcAILo
Market Risk
Which statement(s) is/are FALSE about market risk?
I. It is mitigated by writing calls.
II. It includes the risk the investor will lose invested principal.
III. It is the same as systemic risk.
IV. It is mitigated by buying defensive stocks.
A. I only
B. II only
C. II and III
D. III and IV
Correct answer: B
Statement II describes capital risk not market risk.
http://www.investopedia.com/ask/answers/09/series7-070709.asp?partner=pitm12a
I. It is mitigated by writing calls.
II. It includes the risk the investor will lose invested principal.
III. It is the same as systemic risk.
IV. It is mitigated by buying defensive stocks.
A. I only
B. II only
C. II and III
D. III and IV
Correct answer: B
Statement II describes capital risk not market risk.
http://www.investopedia.com/ask/answers/09/series7-070709.asp?partner=pitm12a
Tuesday 7 December 2010
Vietnam: Call to punish speculators who unsettle domestic stock markets
Last update 04/12/2010 02:49:49 PM (GMT+7)
Call to punish speculators who unsettle domestic stock markets
VietNamNet Bridge – Strict punishment was necessary to stop speculation, illegal price rises and to prevent deliberate rumours having a negative impact on domestic markets.
This was one of the suggestions made at an online meeting yesterday, Dec 3, chaired by the deputy Prime Minister, Hoang Trung Hai.
According to ministries and agencies, gold and dollar price hikes are often attributed to the increased efforts by domestic speculators.
Hai required the Ministries of Industry and Trade , and Finance to review and supplement regulations to handle any acts of speculation, price increase and trade fraud.
Inspections were also needed to deal with any unusual phenomenon on the share and gold markets.
Hai said the media should help disseminate State policies on trading to help prevent rumours.
Plenty of supply
According to the Ministry of Industry and Trade, from now to the end of January there should be plenty of essential commodities.
In Ha Noi and HCM City, a series of price stabilisation programmes have been conducted with financial support from the State.
Deputy Minister of Agriculture and Rural Development Bui Ba Bong said there would be no pressure on the supply of rice as harvest time was near and businesses had plenty of reserves.
* Buyers continue to gain confidence
Positive entiment caused investors to pump money into the stock market pushing 300 shares to their ceilings in both HCM City and Ha Noi yesterday, Dec 3.
The VN Index continued its rise, up 1.51 per cent to close at 464.35 yesterday.
The trading volume was 71.9 million shares valued at VND1.55 trillion (US$77.5 million).
"The 460-466 mark offered strong resistance during the past four months and a mid-term uptrend is likely if the VN-index surpasses it because trading volumes have increased strongly against last month's average," said FPT Securities Co analyst Nguyen Minh Quan.
Volume ranged from 45-70 million shares during the past four days against about 30-35 million last month.
Among the 233 advancers, securities, property and rubber shares were hottest.
They included Sai Gon Securities Incorporate (SSI), HCM City Securities (HCM), Tan Tao Industrial Zone (ITA), Investment Construction (DIC), Kinh Bac Urban Development (KBC), Da Nang Rubber (DRC) and Sao Vang Rubber (SRC).
In Ha Noi, the HN-Index volume climbed to 61.6 million and a total value of VND1.18 trillion.
The index rose strongly by 4.2 per cent to close at 116.6. Securities and property shares were the hottest.
Nguyen Quang Minh, a research analyst for vietstock.vn, said investors seemed to have remembered the lesson of 2008 that when interest rates increased sharply the stock market fell to the bottom.
The market's gain reflected the activities of bottom catchers. When the stock market dropped strongly, foreign investors bought shares to bail out the market, partly helping stabilise the sentiments of domestic investors, he said.
VietNamNet/Viet Nam News
http://english.vietnamnet.vn/en/business/2303/call-to-punish-speculators-who-unsettle-domestic-stock-markets.html
Call to punish speculators who unsettle domestic stock markets
VietNamNet Bridge – Strict punishment was necessary to stop speculation, illegal price rises and to prevent deliberate rumours having a negative impact on domestic markets.
This was one of the suggestions made at an online meeting yesterday, Dec 3, chaired by the deputy Prime Minister, Hoang Trung Hai.
According to ministries and agencies, gold and dollar price hikes are often attributed to the increased efforts by domestic speculators.
Hai required the Ministries of Industry and Trade , and Finance to review and supplement regulations to handle any acts of speculation, price increase and trade fraud.
Inspections were also needed to deal with any unusual phenomenon on the share and gold markets.
Hai said the media should help disseminate State policies on trading to help prevent rumours.
Plenty of supply
According to the Ministry of Industry and Trade, from now to the end of January there should be plenty of essential commodities.
In Ha Noi and HCM City, a series of price stabilisation programmes have been conducted with financial support from the State.
Deputy Minister of Agriculture and Rural Development Bui Ba Bong said there would be no pressure on the supply of rice as harvest time was near and businesses had plenty of reserves.
* Buyers continue to gain confidence
Positive entiment caused investors to pump money into the stock market pushing 300 shares to their ceilings in both HCM City and Ha Noi yesterday, Dec 3.
The VN Index continued its rise, up 1.51 per cent to close at 464.35 yesterday.
The trading volume was 71.9 million shares valued at VND1.55 trillion (US$77.5 million).
"The 460-466 mark offered strong resistance during the past four months and a mid-term uptrend is likely if the VN-index surpasses it because trading volumes have increased strongly against last month's average," said FPT Securities Co analyst Nguyen Minh Quan.
Volume ranged from 45-70 million shares during the past four days against about 30-35 million last month.
Among the 233 advancers, securities, property and rubber shares were hottest.
They included Sai Gon Securities Incorporate (SSI), HCM City Securities (HCM), Tan Tao Industrial Zone (ITA), Investment Construction (DIC), Kinh Bac Urban Development (KBC), Da Nang Rubber (DRC) and Sao Vang Rubber (SRC).
In Ha Noi, the HN-Index volume climbed to 61.6 million and a total value of VND1.18 trillion.
The index rose strongly by 4.2 per cent to close at 116.6. Securities and property shares were the hottest.
Nguyen Quang Minh, a research analyst for vietstock.vn, said investors seemed to have remembered the lesson of 2008 that when interest rates increased sharply the stock market fell to the bottom.
The market's gain reflected the activities of bottom catchers. When the stock market dropped strongly, foreign investors bought shares to bail out the market, partly helping stabilise the sentiments of domestic investors, he said.
VietNamNet/Viet Nam News
http://english.vietnamnet.vn/en/business/2303/call-to-punish-speculators-who-unsettle-domestic-stock-markets.html
Foreign firms eager to invest in Vietnam
Last update 03/12/2010 05:30:11 PM (GMT+7)
Foreign firms eager to invest in VN
International enterprises are more confident about doing business in Viet Nam and are planning to expand is the message the Viet Nam Business Forum in Ha Noi delivered to the Government yesterday.
But their representatives expect a concerted effort to tackle major macro-economic obstacles.
"Viet Nam's success in attracting foreign investment has largely been built on the expectation of economic and political stability," American Chamber of Commerce, Amcham, chairman Hank Tomlinson told the forum - a prelude to the yearly donor Consultative Group meeting.
Unfortunately, the Government's approach to economic and monetary policy had also raised concern, he said.
Amcham, together with other investor representatives, is worried about the falling value of the dong and a perceived lack of an effective policy to control inflation.
Street vendors traded the US dollar at between VND21,400-21,450 yesterday, up VND100 against late last week.
The nominal depreciation of the currency through five deprecations since December 2008 is 11 per cent.
Fall
But the dong has fallen 36.8 per cent in value during the past three years when measured against the consumer price index.
"Monetary policy has helped boost economic growth and control inflation," Deputy Minister of Planning and Investment Dang Huy Dong assured the forum.
And while he recognised potential risk, he reminded the forum that GDP growth in Quarter 1 had been 5.8 per cent; 6.4 per cent in Quarter 2; 7.16 per cent in Quarter 3 and 6.7 per cent in Quarter 4. GDP for the year was estimated at 6.7 per cent against an initial target of 6.5 per cent.
Planning and Investment Minister Vo Hong Phuc said fighting inflation and maintaining stability would be next year's economic priorities.
Inflation of 7 per cent was expected while the target for economic growth was 7.5 per cent.
International Monetary Fund Viet Nam representative Benedict Bingham told Viet Nam News the Government should make macro-economic stability - rather than frequently shift between growth and stability - its first priority.
The change would ensure economic growth, he said.
International Finance Corporation Regional Manager Simon Andrews said Viet Nam could not forever rely on its natural resources, favourable location, relatively low-cost labour for economic growth work.
Quality
Improving the quality of growth was a major challenge, he said.
Eurocham chairman Alain Cany warned that Viet Nam's ability to maintain high economic growth was dependent on the Government's action in infrastructure and its encouragement of innovation.
"Without this, Viet Nam risks falling into the middle-income trap," he said. The trap was an economy based on cheap labour and low-technology manufacturing against value-added knowledge-intensive and innovation-based manufacturing for domestic consumption and export.
The forum listed a variety of worries for international enterprises including:
An inefficient State-owned system;
Corruption and a conflict of interest in the State-owned sector;
Inadequate infrastructures;
A lack of transparency and inadequate governance; and
Bureaucratic investment licensing procedures and the protection of intellectual and property rights.
Vietnamese Government representatives said the contribution of the international enterprises was highly appreciated and their proposals to improve the efficiency of doing business in Viet Nam would be considered.
Source: VNS
http://english.vietnamnet.vn/en/business/2264/foreign-firms-eager-to-invest-in-vn.html
Foreign firms eager to invest in VN
International enterprises are more confident about doing business in Viet Nam and are planning to expand is the message the Viet Nam Business Forum in Ha Noi delivered to the Government yesterday.
But their representatives expect a concerted effort to tackle major macro-economic obstacles.
"Viet Nam's success in attracting foreign investment has largely been built on the expectation of economic and political stability," American Chamber of Commerce, Amcham, chairman Hank Tomlinson told the forum - a prelude to the yearly donor Consultative Group meeting.
Unfortunately, the Government's approach to economic and monetary policy had also raised concern, he said.
Amcham, together with other investor representatives, is worried about the falling value of the dong and a perceived lack of an effective policy to control inflation.
Street vendors traded the US dollar at between VND21,400-21,450 yesterday, up VND100 against late last week.
The nominal depreciation of the currency through five deprecations since December 2008 is 11 per cent.
Fall
But the dong has fallen 36.8 per cent in value during the past three years when measured against the consumer price index.
"Monetary policy has helped boost economic growth and control inflation," Deputy Minister of Planning and Investment Dang Huy Dong assured the forum.
And while he recognised potential risk, he reminded the forum that GDP growth in Quarter 1 had been 5.8 per cent; 6.4 per cent in Quarter 2; 7.16 per cent in Quarter 3 and 6.7 per cent in Quarter 4. GDP for the year was estimated at 6.7 per cent against an initial target of 6.5 per cent.
Planning and Investment Minister Vo Hong Phuc said fighting inflation and maintaining stability would be next year's economic priorities.
Inflation of 7 per cent was expected while the target for economic growth was 7.5 per cent.
International Monetary Fund Viet Nam representative Benedict Bingham told Viet Nam News the Government should make macro-economic stability - rather than frequently shift between growth and stability - its first priority.
The change would ensure economic growth, he said.
International Finance Corporation Regional Manager Simon Andrews said Viet Nam could not forever rely on its natural resources, favourable location, relatively low-cost labour for economic growth work.
Quality
Improving the quality of growth was a major challenge, he said.
Eurocham chairman Alain Cany warned that Viet Nam's ability to maintain high economic growth was dependent on the Government's action in infrastructure and its encouragement of innovation.
"Without this, Viet Nam risks falling into the middle-income trap," he said. The trap was an economy based on cheap labour and low-technology manufacturing against value-added knowledge-intensive and innovation-based manufacturing for domestic consumption and export.
The forum listed a variety of worries for international enterprises including:
An inefficient State-owned system;
Corruption and a conflict of interest in the State-owned sector;
Inadequate infrastructures;
A lack of transparency and inadequate governance; and
Bureaucratic investment licensing procedures and the protection of intellectual and property rights.
Vietnamese Government representatives said the contribution of the international enterprises was highly appreciated and their proposals to improve the efficiency of doing business in Viet Nam would be considered.
Source: VNS
http://english.vietnamnet.vn/en/business/2264/foreign-firms-eager-to-invest-in-vn.html
Vietnamese Stock market: are there any opportunities for long term investments?
Last update 22/11/2010 09:34:09 PM (GMT+7)
Stock market: are there any opportunities for long term investments?
VietNamNet Bridge – The sickly stock market has been testing stock investors’ patience for many months. Other stock markets have recovered but when will Vietnam’s stock market bounce back?
PVGas could only sell 64 percent of the volume of shares it offered at the IPO (initial public offering) on November 17. The IPO average price of PVGas’ share was 31,000 dong per share.
Becoming shareholders of the enterprise which is leading Vietnam’s gas industry, the key industry in Vietnam’s national economy which decides the development of other industries such as power, fertilizer and steel, is really the dream of many investors. Andy Ho, Investment Director of VinaCapital, said that becoming the “owners” of state-owned general corporations is a golden opportunity which does not come regularly.
However, contrary to previous thoughts, the shares were not selling like hot cakes. Of the 1057 investors who successfully bought the stakes, 12 institutions and 1045 individuals bought 4.244 million stakes out of nearly 61 million of stakes sold.
Money exhausted
A lot of companies reported they could sell only 6-10 percent of the volume of stakes offered. At a recent auction of 7.32 million stakes of a LPG firm in the north, only five individual investors registered to buy 0.6 percent of the volume of shares.
According to Huynh Anh Tuan, General Director of SJC, as money is becoming scarcer investors are becoming more cautious with their investment decisions.
Cash is not flowing into the stock market because of many reasons. Tuan said that there are not many expectations on medium term investments, because the market is still awaiting macroeconomic problems to be solved, including the gold and dollar price fever, and it is still awaiting information about the consumer price index (CPI) in November. The increasing bank interest rates have been creating difficulties for enterprises while investors dare not borrow money and mortgage their shares for the loans.
Many enterprises have licenses to issue shares to increase their chartered capital. However, the enterprises still cannot fix the list of shareholders, because shareholders do not want to spend more money on stakes.
Are there any opportunities?
According to some securities companies, institutions and funds have planned for the disbursement. In October, for example, VF1 fund disbursed, lowering the cash proportion from 10 percent to 7 percent of NAV, and sold all the bonds in its investment portfolio. VF4 also disbursed, while the proportions of cash and other assets have decreased from 7.2 percent to 2.4 percent.
According to Tuan, domestic institutions have disbursed because of the cheap stocks, but they also can see the uncertainties.
“At this moment, they dare not spend too much money. The main force in the stock market is individual investors who account for 80 percent of the trading volume,” he said.
So far this year foreign investors’ net sale has reached over 10 trillion dong or 500 million dollar. According to Au Viet Securities Company, the figure is not big, because in the first quarter of 2008 alone, they incurred a loss of up to $1.3 billion.
Why do foreign investors keep purchasing? According to AVSC, foreign investors always target long term investments (3-5 years), and it is still early to explain their investment strategies.
The advice for investors is to maintain high proportions of cash. However, some analysts believe that if investors have idle money, they should think of medium term investments, because they can expect opportunities when the cash flow of $600 billion is pumped into the US economy and a part of the sum may flow to Vietnam.
Source: Saigon tiep thi
http://english.vietnamnet.vn/en/business/1805/stock-market--are-there-any-opportunities-for-long-term-investments-.html
Stock market: are there any opportunities for long term investments?
VietNamNet Bridge – The sickly stock market has been testing stock investors’ patience for many months. Other stock markets have recovered but when will Vietnam’s stock market bounce back?
PVGas could only sell 64 percent of the volume of shares it offered at the IPO (initial public offering) on November 17. The IPO average price of PVGas’ share was 31,000 dong per share.
Becoming shareholders of the enterprise which is leading Vietnam’s gas industry, the key industry in Vietnam’s national economy which decides the development of other industries such as power, fertilizer and steel, is really the dream of many investors. Andy Ho, Investment Director of VinaCapital, said that becoming the “owners” of state-owned general corporations is a golden opportunity which does not come regularly.
However, contrary to previous thoughts, the shares were not selling like hot cakes. Of the 1057 investors who successfully bought the stakes, 12 institutions and 1045 individuals bought 4.244 million stakes out of nearly 61 million of stakes sold.
Money exhausted
A lot of companies reported they could sell only 6-10 percent of the volume of stakes offered. At a recent auction of 7.32 million stakes of a LPG firm in the north, only five individual investors registered to buy 0.6 percent of the volume of shares.
According to Huynh Anh Tuan, General Director of SJC, as money is becoming scarcer investors are becoming more cautious with their investment decisions.
Cash is not flowing into the stock market because of many reasons. Tuan said that there are not many expectations on medium term investments, because the market is still awaiting macroeconomic problems to be solved, including the gold and dollar price fever, and it is still awaiting information about the consumer price index (CPI) in November. The increasing bank interest rates have been creating difficulties for enterprises while investors dare not borrow money and mortgage their shares for the loans.
Many enterprises have licenses to issue shares to increase their chartered capital. However, the enterprises still cannot fix the list of shareholders, because shareholders do not want to spend more money on stakes.
Are there any opportunities?
According to some securities companies, institutions and funds have planned for the disbursement. In October, for example, VF1 fund disbursed, lowering the cash proportion from 10 percent to 7 percent of NAV, and sold all the bonds in its investment portfolio. VF4 also disbursed, while the proportions of cash and other assets have decreased from 7.2 percent to 2.4 percent.
According to Tuan, domestic institutions have disbursed because of the cheap stocks, but they also can see the uncertainties.
“At this moment, they dare not spend too much money. The main force in the stock market is individual investors who account for 80 percent of the trading volume,” he said.
So far this year foreign investors’ net sale has reached over 10 trillion dong or 500 million dollar. According to Au Viet Securities Company, the figure is not big, because in the first quarter of 2008 alone, they incurred a loss of up to $1.3 billion.
Why do foreign investors keep purchasing? According to AVSC, foreign investors always target long term investments (3-5 years), and it is still early to explain their investment strategies.
The advice for investors is to maintain high proportions of cash. However, some analysts believe that if investors have idle money, they should think of medium term investments, because they can expect opportunities when the cash flow of $600 billion is pumped into the US economy and a part of the sum may flow to Vietnam.
Source: Saigon tiep thi
http://english.vietnamnet.vn/en/business/1805/stock-market--are-there-any-opportunities-for-long-term-investments-.html
Vietnam: Stock market keeps falling, stocks dirt cheap
Last update 18/11/2010 04:56:58 PM (GMT+7)
Stock market keeps falling, stocks dirt cheap
VietNamNet Bridge – The stock market has become unprecedentedly gloomy. Securities investors say the stocks are now as “cheap as vegetables”. 105 out of 603 share items listed on both the bourses have market prices below the face values.
T, a securities investor earlier this week came to a securities company to reconsider his investment portfolio. In the first quarter of the year, T purchased a large volume of shares on credit. Now, as the stock prices keep decreasing, he has to put more money into his account, or the security company will have to sell his stocks to take back money.
“I cannot sleep for the last month. This is for the third time the securities company threatened to sell my stocks,” T said.
T’s investment portfolio was once worth five billion dong. However, as stock prices have been decreasing, the values of stocks have decreased by a half. T said he has “blue chips” – the stocks of big insurance companies and banks, but it is very difficult to find buyers nowadays, when the stock prices have become “as cheap as vegetables”.
“The shares are now like waste-papers. The dividends are just 3-4 percent per annum,” he said. Twice T had to put more money into his account (more than 400 million dong) in September in order to keep his investment portfolio.
Trinh Hoai Giang, Deputy General Director of the HCM City Securities Company (HSC), also said that stocks are now dirt cheap. 105 out of 603 share items listed on both the bourses now have the market prices below the face values.
On the HCM City bourse, for example, BAS is now selling at 5800 dong per share, CAD 6500 dong, HVX 5900 dong, MHC 5700 dong, while PRUBF fund certificate 5100 dong, TRI 5100 dong. On the Hanoi bourse, SHC is trading at 6500 dong, SVS 7700 dong, TTC 6300 dong and VTA 4200 dong.
According to stox.vn, 280 share items are being traded at the prices lower or equal to the book values, including blue chips.
Le C, a big stock investor said that he and many friends of his are “meeting troubles” because of the stock price decreases. They do not want to put more money into the accounts, and also do not want to sell stocks to take back money. They decide to “nourish” the investment portfolios, hoping stock prices may increase one day.
Head of the brokerage division of a securities company has revealed that the number of repo contracts of his company has been decreasing sharply.
“They have withdrawn money to make bank deposits. Instead of asking me to give advices on stock prices, they ask me to help update gold and dollar price information,” the broker said.
He added that securities investors do not make transactions these days. They just keep the wait-and-see attitude.
According to Le Dat Chi, MA, a securities analyst, the average trading value has been very low since the beginning of November, at 700 billion dong per trading session. This shows that the majority of investors have been staying out of the market.
Analysts say the stock market remains gloomy because investors still cannot see positive signs of the macro economy, while there are signs showing that the cash flow will be tightened towards the year end. Securities investors have been advised to keep cash until the signs about development become clearer.
Giang said that HSC has been mostly selling its stocks since the beginning of the year. It continues selling stocks now to keep cash and hopes that it will not take a loss.
According to Le Dat Chi, securities investors now feel insecure. The cash flow is still running into gold, foreign currencies and bank deposits as the deposit interest rates have been increasing.
Securities investors are awaiting information about CPI in November to decide what they have to do next. If the CPI keeps increasing, the cash flow will keep away from the stock market.
Source: Saigon tiep thi
http://english.vietnamnet.vn/en/business/1656/stock-market-keeps-falling--stocks-dirt-cheap.html
Stock market keeps falling, stocks dirt cheap
VietNamNet Bridge – The stock market has become unprecedentedly gloomy. Securities investors say the stocks are now as “cheap as vegetables”. 105 out of 603 share items listed on both the bourses have market prices below the face values.
T, a securities investor earlier this week came to a securities company to reconsider his investment portfolio. In the first quarter of the year, T purchased a large volume of shares on credit. Now, as the stock prices keep decreasing, he has to put more money into his account, or the security company will have to sell his stocks to take back money.
“I cannot sleep for the last month. This is for the third time the securities company threatened to sell my stocks,” T said.
T’s investment portfolio was once worth five billion dong. However, as stock prices have been decreasing, the values of stocks have decreased by a half. T said he has “blue chips” – the stocks of big insurance companies and banks, but it is very difficult to find buyers nowadays, when the stock prices have become “as cheap as vegetables”.
“The shares are now like waste-papers. The dividends are just 3-4 percent per annum,” he said. Twice T had to put more money into his account (more than 400 million dong) in September in order to keep his investment portfolio.
Trinh Hoai Giang, Deputy General Director of the HCM City Securities Company (HSC), also said that stocks are now dirt cheap. 105 out of 603 share items listed on both the bourses now have the market prices below the face values.
On the HCM City bourse, for example, BAS is now selling at 5800 dong per share, CAD 6500 dong, HVX 5900 dong, MHC 5700 dong, while PRUBF fund certificate 5100 dong, TRI 5100 dong. On the Hanoi bourse, SHC is trading at 6500 dong, SVS 7700 dong, TTC 6300 dong and VTA 4200 dong.
According to stox.vn, 280 share items are being traded at the prices lower or equal to the book values, including blue chips.
Le C, a big stock investor said that he and many friends of his are “meeting troubles” because of the stock price decreases. They do not want to put more money into the accounts, and also do not want to sell stocks to take back money. They decide to “nourish” the investment portfolios, hoping stock prices may increase one day.
Head of the brokerage division of a securities company has revealed that the number of repo contracts of his company has been decreasing sharply.
“They have withdrawn money to make bank deposits. Instead of asking me to give advices on stock prices, they ask me to help update gold and dollar price information,” the broker said.
He added that securities investors do not make transactions these days. They just keep the wait-and-see attitude.
According to Le Dat Chi, MA, a securities analyst, the average trading value has been very low since the beginning of November, at 700 billion dong per trading session. This shows that the majority of investors have been staying out of the market.
Analysts say the stock market remains gloomy because investors still cannot see positive signs of the macro economy, while there are signs showing that the cash flow will be tightened towards the year end. Securities investors have been advised to keep cash until the signs about development become clearer.
Giang said that HSC has been mostly selling its stocks since the beginning of the year. It continues selling stocks now to keep cash and hopes that it will not take a loss.
According to Le Dat Chi, securities investors now feel insecure. The cash flow is still running into gold, foreign currencies and bank deposits as the deposit interest rates have been increasing.
Securities investors are awaiting information about CPI in November to decide what they have to do next. If the CPI keeps increasing, the cash flow will keep away from the stock market.
Source: Saigon tiep thi
http://english.vietnamnet.vn/en/business/1656/stock-market-keeps-falling--stocks-dirt-cheap.html
Vietnam Real estate bubble – the accessory to inflation
Last update 23/11/2010 03:43:17 PM (GMT+7)
Real estate bubble – the accessory to inflation
VietNamNet Bridge – The real estate bubble is the accessory to inflation, and it should be considered as the “dangerous germ” which must not be allowed to live together with a healthy economy.
Minh, a securities investor, who went bankrupt due to the continued drops in stock prices, has unexpectedly got rich again. Several days ago, he came to a friend’s party as a real estate billionaire. Minh related that after he lost big sums of money on the stock market, he decided to sell all the remaining stocks he had. With the sum of money from selling shares, he bought 200 square meters of land near the Bao Son Paradise area in Hanoi at 30 million dong per square meter. Now he can sell the land plot at 60 million dong per square meter. If he sells the land plot right now, he will get a huge profit of six billion dong – the dream of many businessmen.
Living on virtual values
In theory, Minh’s sum of money has increased by two times. Meanwhile, the 200 square meter of land will still be the same and it has not been enlarged. The increased value can be described as a pumped ball that will return to its initial shape when it goes flat.
However, in urban areas, hundreds of thousands of people are living on the “bubble”.
The real estate fever not only has attracted professional real estate traders, but also individuals, both Vietnamese and foreigners. Even regular employees in state agencies have also jumped on the bandwagon.
Wealthy people rush to purchase land and keep land as valuable assets. People with lower income rush to purchase land to resell land later for profit. As for many ordinary workers, the money from trading land, not daily wages, is now the main income for their families.
No official statistics have been released, but it is estimated that the volume of traded land has reached several millions hectares with the added value of 30-40 percent. The value of the land may reach tens of trillions dong which obviously accounts for a big proportion in GDP.
The real estate bubble is feeding millions people.
People have their pockets picked
While millions people are getting richer thanks to the real estate bubble, another millions people are losing their opportunities to have accommodations.
A civil servant related that he has nearly one billion dong now deposited at banks. He has been saving money for the last 20 years and he hopes he can buy a mid-class apartment in the suburb area. However, he could not imagine that the real estate price would increase so dramatically. At the beginning of the year, an apartment in the area was priced at 20 million dong per square meter. Meanwhile, the price has jumped to 30 million dong. As such, with his sum of money, he would only be able to buy 30 square meters instead of 50 square meters as he previously thought.
According to experts, a reasonable sale price of apartment in multi-storey buildings (25-30 stories) is about 20 million dong per square meter which is high enough for real estate developers to cover expenses and generate profit. However, in fact, apartments are selling at 30 million dong per square meter.
As the price of real estate keeps rising, regular employees are getting poorer. Previously, they could purchase an apartment after 10 years of working, but now, they need 15 years or 20 years to buy an apartment.
The real estate price increases have brought about the increases of all other kinds of goods. House tenants have to pay higher rents, while the prices of materials, equipments all increase. The service fees of education, healthcare and transport all increase accordingly. The “price storm” is attacking every corner of society. It is obvious that the real estate bubble is the accessory to inflation.
A dangerous germ
In 2008, the US witnessed the worst financial crisis in the last 80 years. The crisis originated from a swelling real estate bubble.
Experts have warned that recently the real estate market in Vietnam recently has shown characteristics similar to the US real estate market during the crisis.
People are still rushing to purchase real estate which in turn is leading to virtual growth (the actual value does not increase). If the situation does not improve the real estate bubble is due to burst in a matter of days.
In the world, every family spends 33 percent of their monthly income to pay debts for their house. Meanwhile, in large urban areas in Vietnam, the figure may reach 80 percent.
Experts have warned that a debt crisis is likely to occur in a economy where people have to spend most of their income on accommodation.
Phan The Hai
http://english.vietnamnet.vn/en/business/1854/real-estate-bubble---the-accessory-to-inflation.html
Real estate bubble – the accessory to inflation
VietNamNet Bridge – The real estate bubble is the accessory to inflation, and it should be considered as the “dangerous germ” which must not be allowed to live together with a healthy economy.
Minh, a securities investor, who went bankrupt due to the continued drops in stock prices, has unexpectedly got rich again. Several days ago, he came to a friend’s party as a real estate billionaire. Minh related that after he lost big sums of money on the stock market, he decided to sell all the remaining stocks he had. With the sum of money from selling shares, he bought 200 square meters of land near the Bao Son Paradise area in Hanoi at 30 million dong per square meter. Now he can sell the land plot at 60 million dong per square meter. If he sells the land plot right now, he will get a huge profit of six billion dong – the dream of many businessmen.
Living on virtual values
In theory, Minh’s sum of money has increased by two times. Meanwhile, the 200 square meter of land will still be the same and it has not been enlarged. The increased value can be described as a pumped ball that will return to its initial shape when it goes flat.
However, in urban areas, hundreds of thousands of people are living on the “bubble”.
The real estate fever not only has attracted professional real estate traders, but also individuals, both Vietnamese and foreigners. Even regular employees in state agencies have also jumped on the bandwagon.
Wealthy people rush to purchase land and keep land as valuable assets. People with lower income rush to purchase land to resell land later for profit. As for many ordinary workers, the money from trading land, not daily wages, is now the main income for their families.
No official statistics have been released, but it is estimated that the volume of traded land has reached several millions hectares with the added value of 30-40 percent. The value of the land may reach tens of trillions dong which obviously accounts for a big proportion in GDP.
The real estate bubble is feeding millions people.
People have their pockets picked
While millions people are getting richer thanks to the real estate bubble, another millions people are losing their opportunities to have accommodations.
A civil servant related that he has nearly one billion dong now deposited at banks. He has been saving money for the last 20 years and he hopes he can buy a mid-class apartment in the suburb area. However, he could not imagine that the real estate price would increase so dramatically. At the beginning of the year, an apartment in the area was priced at 20 million dong per square meter. Meanwhile, the price has jumped to 30 million dong. As such, with his sum of money, he would only be able to buy 30 square meters instead of 50 square meters as he previously thought.
According to experts, a reasonable sale price of apartment in multi-storey buildings (25-30 stories) is about 20 million dong per square meter which is high enough for real estate developers to cover expenses and generate profit. However, in fact, apartments are selling at 30 million dong per square meter.
As the price of real estate keeps rising, regular employees are getting poorer. Previously, they could purchase an apartment after 10 years of working, but now, they need 15 years or 20 years to buy an apartment.
The real estate price increases have brought about the increases of all other kinds of goods. House tenants have to pay higher rents, while the prices of materials, equipments all increase. The service fees of education, healthcare and transport all increase accordingly. The “price storm” is attacking every corner of society. It is obvious that the real estate bubble is the accessory to inflation.
A dangerous germ
In 2008, the US witnessed the worst financial crisis in the last 80 years. The crisis originated from a swelling real estate bubble.
Experts have warned that recently the real estate market in Vietnam recently has shown characteristics similar to the US real estate market during the crisis.
People are still rushing to purchase real estate which in turn is leading to virtual growth (the actual value does not increase). If the situation does not improve the real estate bubble is due to burst in a matter of days.
In the world, every family spends 33 percent of their monthly income to pay debts for their house. Meanwhile, in large urban areas in Vietnam, the figure may reach 80 percent.
Experts have warned that a debt crisis is likely to occur in a economy where people have to spend most of their income on accommodation.
Phan The Hai
http://english.vietnamnet.vn/en/business/1854/real-estate-bubble---the-accessory-to-inflation.html
Vietnam: Oversupply in resort real estate market
Last update 23/11/2010 09:00:00 AM (GMT+7)
Oversupply in resort real estate market
VietNamNet Bridge – The Ministry of Planning and Investment has requested local authorities to check the resort real estate development projects in their localities and report back to the ministry. The move has been understood by the public as the warning about the possible excess of the resort real estate projects.
The wave of developing resorts
Market surveys all show that in the past five years, the resort real estate market has been developing rapidly and going beyond the expectations of the management agencies.
Five years ago, there were only several resorts, namely Mui Ne Domaine, The Nam Hai (in Binh Thuan province), or Olalani, Indochina Riverside Tower in Da Nang, and some in tourist cities of Nha Trang and Vung Tau. Most of them were foreign invested projects.
However, the market has welcomed a lot of new investors, both foreign and domestic, over the past five years. The investors hope for big profit.
According to CBRE Vietnam, a real estate service provider, by the end of 2010, Vietnam will have some 55 resort real estate projects which will provide 5318 villas and 6601 apartments.
The figures make people believe that the resort market has become too hot.
In the region, Thailand is considered to have developed resort marketvery early. However, in Phuket, a famous tourist site for the past 20 years, there are only 5624 resort villas and apartments. Meanwhile, in Vietnam there are already 3745 apartments and villas in the central region. In fact, the number of high grade apartments and villas there is even higher than that in Phuket, 253 vs 135.
General Director of CBRE Marc Townsend described the investment wave as the “tsunami” which has landed in Vietnam.
It seems that people now prefer injecting their money in real estate projects to other investment channels, such as gold or securities, because they believe that real estate development can bring larger profit.
More harm than good
An expert from CBRE said that it seems that Vietnamese real estate developers have been too busy to develop the number of villas or apartments, not paying much attention to the quality.
Once the supply far exceeds the demand and goes beyond the management capability, this will be a big trouble.
An official from the Ministry of Planning and Investment said currently Vietnam has nearly no more land left along the coast, especially the localities with good infrastructure such as Da Nang and Binh Thuan.
This seems to be the blunder made by local authorities in the past. They hurried to call for investment by allocating beautiful land plots. many investors were allocated the land, even when they were not capable of carrying out their projects.
Under the current regulations, investors have to obtain permission from the Government only if their resort projects cover more than two hectares. Therefore, investors only register the projects with less than two hectares. As the result, the beautiful seaside has been divided into small plots.
The excessive development of the resort real estate sector, according to experts, may do more harm than good. Investors should be informed that the number of foreign guests and secondary investors is not has high as expected, as only 15 percent of resort real estate projects have been sold to foreigners, according to CBRE.
http://english.vietnamnet.vn/en/business/1819/oversupply-in-resort-real-estate-market.html
Oversupply in resort real estate market
VietNamNet Bridge – The Ministry of Planning and Investment has requested local authorities to check the resort real estate development projects in their localities and report back to the ministry. The move has been understood by the public as the warning about the possible excess of the resort real estate projects.
The wave of developing resorts
Market surveys all show that in the past five years, the resort real estate market has been developing rapidly and going beyond the expectations of the management agencies.
Five years ago, there were only several resorts, namely Mui Ne Domaine, The Nam Hai (in Binh Thuan province), or Olalani, Indochina Riverside Tower in Da Nang, and some in tourist cities of Nha Trang and Vung Tau. Most of them were foreign invested projects.
However, the market has welcomed a lot of new investors, both foreign and domestic, over the past five years. The investors hope for big profit.
According to CBRE Vietnam, a real estate service provider, by the end of 2010, Vietnam will have some 55 resort real estate projects which will provide 5318 villas and 6601 apartments.
The figures make people believe that the resort market has become too hot.
In the region, Thailand is considered to have developed resort marketvery early. However, in Phuket, a famous tourist site for the past 20 years, there are only 5624 resort villas and apartments. Meanwhile, in Vietnam there are already 3745 apartments and villas in the central region. In fact, the number of high grade apartments and villas there is even higher than that in Phuket, 253 vs 135.
General Director of CBRE Marc Townsend described the investment wave as the “tsunami” which has landed in Vietnam.
It seems that people now prefer injecting their money in real estate projects to other investment channels, such as gold or securities, because they believe that real estate development can bring larger profit.
More harm than good
An expert from CBRE said that it seems that Vietnamese real estate developers have been too busy to develop the number of villas or apartments, not paying much attention to the quality.
Once the supply far exceeds the demand and goes beyond the management capability, this will be a big trouble.
An official from the Ministry of Planning and Investment said currently Vietnam has nearly no more land left along the coast, especially the localities with good infrastructure such as Da Nang and Binh Thuan.
This seems to be the blunder made by local authorities in the past. They hurried to call for investment by allocating beautiful land plots. many investors were allocated the land, even when they were not capable of carrying out their projects.
Under the current regulations, investors have to obtain permission from the Government only if their resort projects cover more than two hectares. Therefore, investors only register the projects with less than two hectares. As the result, the beautiful seaside has been divided into small plots.
The excessive development of the resort real estate sector, according to experts, may do more harm than good. Investors should be informed that the number of foreign guests and secondary investors is not has high as expected, as only 15 percent of resort real estate projects have been sold to foreigners, according to CBRE.
http://english.vietnamnet.vn/en/business/1819/oversupply-in-resort-real-estate-market.html
K-Star eyes dual listing prospects
K-Star eyes dual listing prospects
Posted on November 28, 2010, Sunday
KUCHING: K-Star Sports Ltd (K-Star) announced recently the company’s proposals to implement a sponsorship of a Depository Receipts Programme (DRP) in Taiwan.
Executive chairman and chief executive officer of K-Star, Ding Jianping commented, “The dual listing will also help promote public awareness towards K-Star in Taiwan, strengthening our international brand image and providing an alternative source of funding for the company.”
“Under our proposed TDR programme, the 100 million K-Star shares forming the underlying shares for the issuance of the TDRs shall comprise of up to 75.6 million new K-Star shares to be issued pursuant to the proposed share issuance and up to 24.4 million existing K-Star shares by certain existing shareholders,” he added.
The TDRs would be offered to potential investors in Taiwan by way of placement to identified third party investors and would be offered to the investing public in Taiwan.
The principal parties that would be involved in the Proposed TDR Programme included K-Star; Bank SinoPac, a financial institution based in Taiwan; Citibank NA Hong Kong, and Citibank Bhd and SinoPac Securities Corp as the underwriter for the offering of TDRs to investors in Taiwan.
The maximum gross proceeds to be raised from the proposed share issuance was expected to amount to approximately RM77.87 million, based on the indicative issue price of RM1.03 per new share, of which RM19.5 million would be used to expand K-Star’s production capacity.
The company also stated that RM15 million would be utilised for expansion of sales and marketing network; RM9 million to continue to boost the company’s branding and advertising efforts; RM3 million to enhance product design and development capabilities.
The balance of the fund would be allocated for general working capital and expected expenses for the Proposed TDR Programme and the Proposed Share Issuance.
“We are very optimistic about our prospects.
“Our company has recently expanded its footprints in the People’s Republic of China (PRC) and Russia and has successfully set up 19 wholesale points,” Ding said.
“We are pleased to continuously report sustainable growth for K-Star and we believe that K-Star is established and resourceful enough to venture into a dual listing. K-Star is eager to share its profit to a more diversified shareholder base through our dual listing,” he concluded.
http://www.theborneopost.com/?p=77531
Posted on November 28, 2010, Sunday
KUCHING: K-Star Sports Ltd (K-Star) announced recently the company’s proposals to implement a sponsorship of a Depository Receipts Programme (DRP) in Taiwan.
Executive chairman and chief executive officer of K-Star, Ding Jianping commented, “The dual listing will also help promote public awareness towards K-Star in Taiwan, strengthening our international brand image and providing an alternative source of funding for the company.”
“Under our proposed TDR programme, the 100 million K-Star shares forming the underlying shares for the issuance of the TDRs shall comprise of up to 75.6 million new K-Star shares to be issued pursuant to the proposed share issuance and up to 24.4 million existing K-Star shares by certain existing shareholders,” he added.
The TDRs would be offered to potential investors in Taiwan by way of placement to identified third party investors and would be offered to the investing public in Taiwan.
The principal parties that would be involved in the Proposed TDR Programme included K-Star; Bank SinoPac, a financial institution based in Taiwan; Citibank NA Hong Kong, and Citibank Bhd and SinoPac Securities Corp as the underwriter for the offering of TDRs to investors in Taiwan.
The maximum gross proceeds to be raised from the proposed share issuance was expected to amount to approximately RM77.87 million, based on the indicative issue price of RM1.03 per new share, of which RM19.5 million would be used to expand K-Star’s production capacity.
The company also stated that RM15 million would be utilised for expansion of sales and marketing network; RM9 million to continue to boost the company’s branding and advertising efforts; RM3 million to enhance product design and development capabilities.
The balance of the fund would be allocated for general working capital and expected expenses for the Proposed TDR Programme and the Proposed Share Issuance.
“We are very optimistic about our prospects.
“Our company has recently expanded its footprints in the People’s Republic of China (PRC) and Russia and has successfully set up 19 wholesale points,” Ding said.
“We are pleased to continuously report sustainable growth for K-Star and we believe that K-Star is established and resourceful enough to venture into a dual listing. K-Star is eager to share its profit to a more diversified shareholder base through our dual listing,” he concluded.
http://www.theborneopost.com/?p=77531
K-Star expands footprints in China
K-Star expands footprints in China
Posted on November 20, 2010, Saturday
KUCHING: K-Star Sports Ltd (K-Star) announced that it was expanding its footprint in China by setting up six new wholesale outlets in Northern China through its wholly owned subsidiary, Fujian Jinjiang Dixing Shoes Plastics Co Ltd (Fujian Dixing).
According to its executive chairman and chief executive officer, Ding Jianping, “We have started developing the Northern China market since the middle of this year and as at the end of October this year, K-Star has successfully set up 19 wholesale points, in which six are new outlets located in Urumqi situated in Xinjiang, and the remaining in Russia.
“This marks the recognition and expansion of K-Star products to all the neighbouring countries. K-Star will further leverage on its current wholesale base and identify qualified distributors to operate and manage the point of sales,” he added.
Since its listing in June 2010 on the Main Market of Bursa Malaysia Securities Bhd, K-Star has been actively expanding its business in its quest to achieve its objective of being a long-term key player in the business.
Fujian Dixing, which was initially engaged in the production of shoe soles and canvas shoes, has broadened its business by venturing into the design, manufacture and distribution of sportswear besides its core business of canvas shoes.
Ding added, “K-Star has always believed in the promising export potential of China. This confidence propelled us to begin our first venture of setting up internal wholesale spots in Northern China.
“We have confidence this will help promote our sportswear brand for the export market and capture a greater market share in the country. The new wholesale platforms are expected to prosper alongside the flourishing economy churned by the development of the West and North China markets. ”
K-Star currently has overseas distribution networks in Russia and Eastern European countries including Finland, Ukraine, Belarus, Poland, Finland, Romania, Hungary and the Czech Republic, among other nations.
Fujian Dixing currently generates over 700 designs annually and manufactures approximately 7.9 million pairs of quality sports footwear, out of which 4.3 million pairs are distributed to their retail outlets in the PRC market in 2009.
http://www.theborneopost.com/?p=76159
Posted on November 20, 2010, Saturday
KUCHING: K-Star Sports Ltd (K-Star) announced that it was expanding its footprint in China by setting up six new wholesale outlets in Northern China through its wholly owned subsidiary, Fujian Jinjiang Dixing Shoes Plastics Co Ltd (Fujian Dixing).
According to its executive chairman and chief executive officer, Ding Jianping, “We have started developing the Northern China market since the middle of this year and as at the end of October this year, K-Star has successfully set up 19 wholesale points, in which six are new outlets located in Urumqi situated in Xinjiang, and the remaining in Russia.
“This marks the recognition and expansion of K-Star products to all the neighbouring countries. K-Star will further leverage on its current wholesale base and identify qualified distributors to operate and manage the point of sales,” he added.
Since its listing in June 2010 on the Main Market of Bursa Malaysia Securities Bhd, K-Star has been actively expanding its business in its quest to achieve its objective of being a long-term key player in the business.
Fujian Dixing, which was initially engaged in the production of shoe soles and canvas shoes, has broadened its business by venturing into the design, manufacture and distribution of sportswear besides its core business of canvas shoes.
Ding added, “K-Star has always believed in the promising export potential of China. This confidence propelled us to begin our first venture of setting up internal wholesale spots in Northern China.
“We have confidence this will help promote our sportswear brand for the export market and capture a greater market share in the country. The new wholesale platforms are expected to prosper alongside the flourishing economy churned by the development of the West and North China markets. ”
K-Star currently has overseas distribution networks in Russia and Eastern European countries including Finland, Ukraine, Belarus, Poland, Finland, Romania, Hungary and the Czech Republic, among other nations.
Fujian Dixing currently generates over 700 designs annually and manufactures approximately 7.9 million pairs of quality sports footwear, out of which 4.3 million pairs are distributed to their retail outlets in the PRC market in 2009.
http://www.theborneopost.com/?p=76159
MAAKL holds ‘Wealth Talk’ on market outlook
MAAKL holds ‘Wealth Talk’ on market outlook
by Ko Ping How kopinghow@theborneopost.com. Posted on December 7, 2010, Tuesday
KUCHING: The recently concluded ‘Wealth Talk’ on December 4 at Grand Continental Hotel was an inaugural event in the city organised by MAAKL Mutual Bhd (MAAKL). The talk aimed to help the public to make informed investment decisions entering the year 2011.
INAUGURAL EVENT: (From left) Senior general manager of MAAKL, Patrick Nge, Ng and Devadason. The ‘Wealth Talk’ is an inaugural event in the city organised by MAAKL.
MAAKL invited two professionals from the investment and financial planning fields who briefed participants on the stock markets’ outlook for 2011 and explained how good financial planning would help achieve short and long term financial goals.
Chief executive officer of Meridian Asset Management Sdn Bhd, Nicholas Ng, presented the talk on ‘Stock markets supported by liquidity but entering high risk zone’.
Ng stated, “What we are seeing since November for the US dollar was a technical bounce. The US really needed to sort out its economy and the huge amount of borrowing and printing of money is actually very bad for the US.
“There’s very little justification for a strong US dollar due to the recent rebound which is attributed to the weakness of the euro. At some point in time, the US economy will go back down to a weaker half next year and that’s where I think it will be a real challenge for the US dollar,” he added.
In response to where the FTSE Bursa Malaysia KLCI (FBM KLCI) would be heading in the upcoming year, Ng commented that, “We have an index of roughly 1,643 and I think it will have an eight per cent upside next year.”
He pointed out that investors could still make money in Malaysia but relative to North Asia, the risk would go up and ratio would be higher next year. Nonetheless, he opined that growth in the merging market would not be an issue and Malaysia would be recording roughly 5.2 to 5.4 per cent growth in 2011.
“North Asian countries like China would probably come down a little bit but will be at seven to maybe 8.2 per cent. Generally, in Asia, growth will not be a major concern,” viewed Ng.
On the topic of investment options, Ng expressed that Sarawakians were more localised that they focused only on local markets.
He stated, “Ideally, the way going forward is to diversify their investments especially into Pacific Mutual funds.”
He proposed Malaysians to look beyond national equities and go offshore to diversify their investments.
When queried on what stocks would have more importance in the future, he said that the election theme would be one area that could be focused on. Investing in large caps, goodwill and high dividend stocks would continue to do well even if markets were to correct in the first half of next year.
The second speaker, Rajen Devadason, chief executive officer of RD WealthCreation Sdn Bhd, a Certified Financial Planner and a Securities Commission-licenced financial planner with MAAKL talked on ‘Financial planning, asset allocation and the future of your wealth’.
Devadason said, “Based on the world wealth report published by Capgemini and Merrill Lynch, there are five asset classes that the very wealthiest put their money into. These are equities, investment real estates, fixed income such as bonds, cash in the bank and alternative investments.”
“The smartest thing a normal individual can do is to see what the wealthiest people in the world are doing and learn their skills from them,” he added.
To answer whether foreign companies’ investment in FBM KLCI would have a positive effect, Devadason said that “If foreign companies come in and just pump money into Bursa Malaysia in a hurry, what happens is the market would take off like a rocket and this is hot money. So, Malaysians as serious investors should track and know the stocks. If we get to the point where the valuations are excessive, to get rich, you must buy low and sell high,” he enthused.
“If foreigners coming in pumped in lot money and our stock prices start to escalate, maybe it’s time for us to take some money off the table and to re-allocate. However, if the trend reverses, investors can get hurt badly. So, it can be a double-edged deal,” he pointed out further.
In conclusion, Ng noted that for higher risk-taking investors, alternative investments were good options. They included derivatives, options, futures or even arbitrage funds and commodities funds.
“There are lot of options and the most common with a cheaper entry cost is the exchange traded fund (ETF) that has also grown tremendously. There are many avenues now whereby new investors can take higher risks and at the same time use some of these instruments to hatch their underlined investments.”
http://www.theborneopost.com/?p=79189
by Ko Ping How kopinghow@theborneopost.com. Posted on December 7, 2010, Tuesday
KUCHING: The recently concluded ‘Wealth Talk’ on December 4 at Grand Continental Hotel was an inaugural event in the city organised by MAAKL Mutual Bhd (MAAKL). The talk aimed to help the public to make informed investment decisions entering the year 2011.
INAUGURAL EVENT: (From left) Senior general manager of MAAKL, Patrick Nge, Ng and Devadason. The ‘Wealth Talk’ is an inaugural event in the city organised by MAAKL.
MAAKL invited two professionals from the investment and financial planning fields who briefed participants on the stock markets’ outlook for 2011 and explained how good financial planning would help achieve short and long term financial goals.
Chief executive officer of Meridian Asset Management Sdn Bhd, Nicholas Ng, presented the talk on ‘Stock markets supported by liquidity but entering high risk zone’.
Ng stated, “What we are seeing since November for the US dollar was a technical bounce. The US really needed to sort out its economy and the huge amount of borrowing and printing of money is actually very bad for the US.
“There’s very little justification for a strong US dollar due to the recent rebound which is attributed to the weakness of the euro. At some point in time, the US economy will go back down to a weaker half next year and that’s where I think it will be a real challenge for the US dollar,” he added.
In response to where the FTSE Bursa Malaysia KLCI (FBM KLCI) would be heading in the upcoming year, Ng commented that, “We have an index of roughly 1,643 and I think it will have an eight per cent upside next year.”
He pointed out that investors could still make money in Malaysia but relative to North Asia, the risk would go up and ratio would be higher next year. Nonetheless, he opined that growth in the merging market would not be an issue and Malaysia would be recording roughly 5.2 to 5.4 per cent growth in 2011.
“North Asian countries like China would probably come down a little bit but will be at seven to maybe 8.2 per cent. Generally, in Asia, growth will not be a major concern,” viewed Ng.
On the topic of investment options, Ng expressed that Sarawakians were more localised that they focused only on local markets.
He stated, “Ideally, the way going forward is to diversify their investments especially into Pacific Mutual funds.”
He proposed Malaysians to look beyond national equities and go offshore to diversify their investments.
When queried on what stocks would have more importance in the future, he said that the election theme would be one area that could be focused on. Investing in large caps, goodwill and high dividend stocks would continue to do well even if markets were to correct in the first half of next year.
The second speaker, Rajen Devadason, chief executive officer of RD WealthCreation Sdn Bhd, a Certified Financial Planner and a Securities Commission-licenced financial planner with MAAKL talked on ‘Financial planning, asset allocation and the future of your wealth’.
Devadason said, “Based on the world wealth report published by Capgemini and Merrill Lynch, there are five asset classes that the very wealthiest put their money into. These are equities, investment real estates, fixed income such as bonds, cash in the bank and alternative investments.”
“The smartest thing a normal individual can do is to see what the wealthiest people in the world are doing and learn their skills from them,” he added.
To answer whether foreign companies’ investment in FBM KLCI would have a positive effect, Devadason said that “If foreign companies come in and just pump money into Bursa Malaysia in a hurry, what happens is the market would take off like a rocket and this is hot money. So, Malaysians as serious investors should track and know the stocks. If we get to the point where the valuations are excessive, to get rich, you must buy low and sell high,” he enthused.
“If foreigners coming in pumped in lot money and our stock prices start to escalate, maybe it’s time for us to take some money off the table and to re-allocate. However, if the trend reverses, investors can get hurt badly. So, it can be a double-edged deal,” he pointed out further.
In conclusion, Ng noted that for higher risk-taking investors, alternative investments were good options. They included derivatives, options, futures or even arbitrage funds and commodities funds.
“There are lot of options and the most common with a cheaper entry cost is the exchange traded fund (ETF) that has also grown tremendously. There are many avenues now whereby new investors can take higher risks and at the same time use some of these instruments to hatch their underlined investments.”
http://www.theborneopost.com/?p=79189
The emergence of the underperformers
The emergence of the underperformers
by Ghaz Ghazali ghazghazali@theborneopost.com.
Posted on December 6, 2010, Monday
Earning numbers in 3Q10 not favouring outperformers – Analysts
SHIFT IN TREND: Photo shows the Bursa Malaysia building at Bukit Kewangan, Kuala Lumpur – the nation’s bourse and index centre. Companies pegged under ‘downgrade’ call have exceeded the ‘upgrades’ by 33 per cent as corporate earnings in the country have been slipping against expectations since last year’s fourth quarter.
KUCHING: The year’s third quarter results signals the rise of underperformers, which outnumbered outperformers by two to one – indicating continued pressure faced by certain key sectors, say analysts.
On a percentage basis, companies pegged under ‘downgrade’ calls exceeded the ‘upgrade’ ones by 33 per cent as corporate earnings in the country had been slipping against expectations since last year’s fourth quarter, observed OSK Research Sdn Bhd’s (OSK Research) head of research Chris Eng.
“Third quarter earnings were uninspiring particularly the small caps, with 45 per cent of companies reporting results that were below expectations compared with the big caps, of which 60 per cent were within expectations.
“Sector-wise, only the media sector outperformed. On the flipside; the smaller steel, technology and O&G (oil and gas) companies reported weak results owing to lower margins, a stronger ringgit and delays in contract awards,” he outlined.
On the other hand, ECM Libra Capital Sdn Bhd’s (ECM Libra) head analyst Bernard Ching noted that while the trend appeared to favour underperformers in the reviewed quarter, positive earnings surprises were somewhat more than those in the negative.
“Even as positive ear-nings surprises for the third quarter – which comprised 18 per cent of stocks under our coverage – were lower than the 29 per cent reported in the preceding second quarter, there were fewer negative earnings surprises as well,” he pointed out, adding that 12 per cent of stocks under coverage had failed to meet estimates against 20 per cent in the preceding quarter.
Notable players that recorded such positive earnings surprises included telco giant Axiata Group Bhd, national airline Malaysian Airline System Bhd (MAS), O&G-related services provider Dayang Enterprises Holdings Bhd and construction conglomerate Sunway Holdings Bhd.
On the negative end, the research house weighted off building materials provider Lafarge Malayan Cement Bhd; consumer goods distributor Pelikan International Corp Bhd; O&G groups Petra Perdana Bhd and Wah Seong Corporation Bhd; plantation player Boustead Holdings Bhd; and construction company Sunway City Bhd.
Adding in a more optimistic take on the underperformers-versus-outperformers scenario, HwangDBS Vickers Research Sdn Bhd’s head of research Wong Ming Tek maintained that the restructuring of the KLCI in July last year should provide an added boost with higher weightings on bigger caps.
“The absolute 2010 net profit for our universe is set to surpass pre-financial crisis levels, supporting the KLCI (Kuala Lumpur Composite Index) to new highs in 2011. Coupled with impending Sarawak state elections, the government’s ongoing reforms and potentially strong CPO (crude palm oil) prices; we believe that the resilient economic growth, interest rate differential and weak US dollar could also see higher levels of foreign ownership.”
Similarly, ECM Libra’s Ching was also positive on the foreign ownership matter, highlighting that foreign net equity inflows would remain strong in the near term.
“We are still positive in the near term. Although the local index has retraced by about three per cent since hitting a high of 1,528.01 three weeks ago, we are unfazed by it.
“Rather, we believe the market will continue its uptrend in a more meaningful manner in next year’s first quarter, led by resilient domestic consumption, strong foreign net equity inflows, M&A (mergers and acquisitions) activities and also the Sarawak state election.”
On behalf of OSK Research, Eng believed that upgrades might again beat downgrades by the end of the fourth quarter, assuming that “things to turn for the better in the coming last quarter of this year.”
“For now, we maintain our 2011 fair value of 1,648 points, with our KLCI earnings growth to remain intact at 16 per cent. We maintain our ‘overweight’ call on the Malaysian market,” he added.
http://www.theborneopost.com/?p=78965
by Ghaz Ghazali ghazghazali@theborneopost.com.
Posted on December 6, 2010, Monday
Earning numbers in 3Q10 not favouring outperformers – Analysts
SHIFT IN TREND: Photo shows the Bursa Malaysia building at Bukit Kewangan, Kuala Lumpur – the nation’s bourse and index centre. Companies pegged under ‘downgrade’ call have exceeded the ‘upgrades’ by 33 per cent as corporate earnings in the country have been slipping against expectations since last year’s fourth quarter.
KUCHING: The year’s third quarter results signals the rise of underperformers, which outnumbered outperformers by two to one – indicating continued pressure faced by certain key sectors, say analysts.
On a percentage basis, companies pegged under ‘downgrade’ calls exceeded the ‘upgrade’ ones by 33 per cent as corporate earnings in the country had been slipping against expectations since last year’s fourth quarter, observed OSK Research Sdn Bhd’s (OSK Research) head of research Chris Eng.
“Third quarter earnings were uninspiring particularly the small caps, with 45 per cent of companies reporting results that were below expectations compared with the big caps, of which 60 per cent were within expectations.
“Sector-wise, only the media sector outperformed. On the flipside; the smaller steel, technology and O&G (oil and gas) companies reported weak results owing to lower margins, a stronger ringgit and delays in contract awards,” he outlined.
On the other hand, ECM Libra Capital Sdn Bhd’s (ECM Libra) head analyst Bernard Ching noted that while the trend appeared to favour underperformers in the reviewed quarter, positive earnings surprises were somewhat more than those in the negative.
“Even as positive ear-nings surprises for the third quarter – which comprised 18 per cent of stocks under our coverage – were lower than the 29 per cent reported in the preceding second quarter, there were fewer negative earnings surprises as well,” he pointed out, adding that 12 per cent of stocks under coverage had failed to meet estimates against 20 per cent in the preceding quarter.
Notable players that recorded such positive earnings surprises included telco giant Axiata Group Bhd, national airline Malaysian Airline System Bhd (MAS), O&G-related services provider Dayang Enterprises Holdings Bhd and construction conglomerate Sunway Holdings Bhd.
On the negative end, the research house weighted off building materials provider Lafarge Malayan Cement Bhd; consumer goods distributor Pelikan International Corp Bhd; O&G groups Petra Perdana Bhd and Wah Seong Corporation Bhd; plantation player Boustead Holdings Bhd; and construction company Sunway City Bhd.
Adding in a more optimistic take on the underperformers-versus-outperformers scenario, HwangDBS Vickers Research Sdn Bhd’s head of research Wong Ming Tek maintained that the restructuring of the KLCI in July last year should provide an added boost with higher weightings on bigger caps.
“The absolute 2010 net profit for our universe is set to surpass pre-financial crisis levels, supporting the KLCI (Kuala Lumpur Composite Index) to new highs in 2011. Coupled with impending Sarawak state elections, the government’s ongoing reforms and potentially strong CPO (crude palm oil) prices; we believe that the resilient economic growth, interest rate differential and weak US dollar could also see higher levels of foreign ownership.”
Similarly, ECM Libra’s Ching was also positive on the foreign ownership matter, highlighting that foreign net equity inflows would remain strong in the near term.
“We are still positive in the near term. Although the local index has retraced by about three per cent since hitting a high of 1,528.01 three weeks ago, we are unfazed by it.
“Rather, we believe the market will continue its uptrend in a more meaningful manner in next year’s first quarter, led by resilient domestic consumption, strong foreign net equity inflows, M&A (mergers and acquisitions) activities and also the Sarawak state election.”
On behalf of OSK Research, Eng believed that upgrades might again beat downgrades by the end of the fourth quarter, assuming that “things to turn for the better in the coming last quarter of this year.”
“For now, we maintain our 2011 fair value of 1,648 points, with our KLCI earnings growth to remain intact at 16 per cent. We maintain our ‘overweight’ call on the Malaysian market,” he added.
http://www.theborneopost.com/?p=78965
M’sian education sector set for next boom phase
M’sian education sector set for next boom phase
Posted on November 27, 2010, Saturday
KUALA LUMPUR: While the property sector now is in a flurry of consolidation through mergers and acquisitions, kicked off by UEM Land Bhd’s acquisition of Sunrise Bhd, followed swiftly by the just announced mergers of MRCB Bhd with IJM Land Bhd and Sunway Holdings Bhd with Sunway City Bhd, the education sector still remains ‘under the radar’.
MORE STUDENTS: The government is set to intensify its efforts to garner more students from the Middle East, China, Africa and other parts of South East Asia into Malaysia. - Photo from destination360.com
However, the fast growing private education business in Malaysia, which is currently valued to be worth some RM7.2 billion, seems to be stirring of late.
Ekuiti Nasional Bhd’s (EKUINAS) recent 51 per cent acquisition of APIIT/UCTI Education Group from Sapura Resources Bhd is seen as trailblazer for consolidation in the private education sector.
This is because of more outright acquisitions, mergers and the entry of fresh foreign players in time to come.
“There will be more mergers in the works as education entities that don’t merge may risk being left behind.
“There is urgency for smaller players to bulk up for scale and build up quality as the more renowned and established international players which have made their presence in Malaysia pose healthy competition to the growing market,” said Zakie Ahmad Shariff, chief executive of FA Securities Bhd and a former director of EduCity in Iskandar Malaysia.
This is more so as education has been identified as one of 12 National Key Economic Areas (NKEAs), with private education leading the
charge in catapulting Malaysia into the fastest growing education hub in South East Asia.
Malaysia has already become the 11th largest education exporting country with approximately 90,000 international students from more than 100 countries studying here in various international schools, colleges and universities.
Among the listed educational entities are Sapura Resources, SEG International Bhd, Help International Corp Bhd and Masterskill (M) Education Group Bhd.
Associate Professor Dr Rohaida Mohd Saat of the Faculty of Education, Universiti Malaya, lauded the move by EKUINAS and Sapura, saying, “the time has come for private colleges to merge, so as to gear themselves towards creating scale and meeting the increasing demands of foreign students flocking to Malaysia.”
Professor Dr Saifollah Abdullah from the Faculty of Applied Sciences at Universiti Technologi MARA said the Ekuinas Sapura pact was a perfect example of public-private partnership in the education sector.
The Education NKEA has been targeted to more than double the total gross national income to RM60.7 billion by 2020 from the current RM27.1 million.
Commenting on Malaysia’s attraction as an education destination, Dr Muhammad Azhar Zailani from the Faculty of Education, Universiti Malaya, said this is due to the competitive course fees, wide range of study options, many choices of universities and colleges and the existence of branch overseas university campuses.
“This allows students from different parts of the world to come to Malaysia, acquire prestigious qualifications from well-known universities from the West at an affordable price,” he said.
Aside from quality education, experts cite affordable living expenses, an economically sound and safe country and geographically safe environment as the main factors set to grow the education sector.
The government is set to intensify its efforts to garner more students from the Middle East, China, Africa and other parts of South East Asia into Malaysia.
To further build Malaysia’s participation in the global education sector, the government is also encouraging branch campuses of Malaysian educational institutes to go overseas.
Several Malaysian institutes of higher learning have branches overseas, including UCSI University and Limkokwing University in London.
Dr Muhammad Azhar said educational establishments must look towards merging with other established entities or be part of a larger educational network.
A notable example is INTI Educational Group that was acquired by Laureate International Universities from the United States.
With a presence in 21 countries globally, it has now become a leading educational establishment in the Malaysia as well.
Laureate said the reason why Malaysia was chosen as a preferred destination was its emphasis on infrastructure facilities and the government’s emphasis on developing Malaysia into an education hub.
In recent years, Kuala Lumpur, Petaling Jaya, Subang Jaya and Nilai have seen the mushrooming of many educational enclaves or precincts, attracting many foreign students in the process.
Malaysian educational players have also acquired smaller players and enlarged their base through listing their business as a way of tapping into greater capital resources as well as increasing student enrolment.
A case in point is HELP International Corporation Bhd and INTI Universal Holdings Bhd.
The listed holding companies of these educational establishments have strong collaboration with various overseas universities and attract many overseas students who want to acquire quality education at a reasonable cost.
Sapura Resources, which until recently held 100 per cent of APIT/UCTI Education, decided to divest 51 per cent of its stake to EKUINAS while holding the remaining 49 per cent along with management rights.
Now it appears both SAPURA and Ekuinas are in a better position to take advantage of the growth prospects of the fast-expanding education sector.
While some were quick to point out that Sapura was divesting from education, other observers argue that Sapura had in fact reinforced its commitment to the sector by getting a partner in order to grow its stake in the business. — Bernama
Posted on November 27, 2010, Saturday
KUALA LUMPUR: While the property sector now is in a flurry of consolidation through mergers and acquisitions, kicked off by UEM Land Bhd’s acquisition of Sunrise Bhd, followed swiftly by the just announced mergers of MRCB Bhd with IJM Land Bhd and Sunway Holdings Bhd with Sunway City Bhd, the education sector still remains ‘under the radar’.
MORE STUDENTS: The government is set to intensify its efforts to garner more students from the Middle East, China, Africa and other parts of South East Asia into Malaysia. - Photo from destination360.com
However, the fast growing private education business in Malaysia, which is currently valued to be worth some RM7.2 billion, seems to be stirring of late.
Ekuiti Nasional Bhd’s (EKUINAS) recent 51 per cent acquisition of APIIT/UCTI Education Group from Sapura Resources Bhd is seen as trailblazer for consolidation in the private education sector.
This is because of more outright acquisitions, mergers and the entry of fresh foreign players in time to come.
“There will be more mergers in the works as education entities that don’t merge may risk being left behind.
“There is urgency for smaller players to bulk up for scale and build up quality as the more renowned and established international players which have made their presence in Malaysia pose healthy competition to the growing market,” said Zakie Ahmad Shariff, chief executive of FA Securities Bhd and a former director of EduCity in Iskandar Malaysia.
This is more so as education has been identified as one of 12 National Key Economic Areas (NKEAs), with private education leading the
charge in catapulting Malaysia into the fastest growing education hub in South East Asia.
Malaysia has already become the 11th largest education exporting country with approximately 90,000 international students from more than 100 countries studying here in various international schools, colleges and universities.
Among the listed educational entities are Sapura Resources, SEG International Bhd, Help International Corp Bhd and Masterskill (M) Education Group Bhd.
Associate Professor Dr Rohaida Mohd Saat of the Faculty of Education, Universiti Malaya, lauded the move by EKUINAS and Sapura, saying, “the time has come for private colleges to merge, so as to gear themselves towards creating scale and meeting the increasing demands of foreign students flocking to Malaysia.”
Professor Dr Saifollah Abdullah from the Faculty of Applied Sciences at Universiti Technologi MARA said the Ekuinas Sapura pact was a perfect example of public-private partnership in the education sector.
The Education NKEA has been targeted to more than double the total gross national income to RM60.7 billion by 2020 from the current RM27.1 million.
Commenting on Malaysia’s attraction as an education destination, Dr Muhammad Azhar Zailani from the Faculty of Education, Universiti Malaya, said this is due to the competitive course fees, wide range of study options, many choices of universities and colleges and the existence of branch overseas university campuses.
“This allows students from different parts of the world to come to Malaysia, acquire prestigious qualifications from well-known universities from the West at an affordable price,” he said.
Aside from quality education, experts cite affordable living expenses, an economically sound and safe country and geographically safe environment as the main factors set to grow the education sector.
The government is set to intensify its efforts to garner more students from the Middle East, China, Africa and other parts of South East Asia into Malaysia.
To further build Malaysia’s participation in the global education sector, the government is also encouraging branch campuses of Malaysian educational institutes to go overseas.
Several Malaysian institutes of higher learning have branches overseas, including UCSI University and Limkokwing University in London.
Dr Muhammad Azhar said educational establishments must look towards merging with other established entities or be part of a larger educational network.
A notable example is INTI Educational Group that was acquired by Laureate International Universities from the United States.
With a presence in 21 countries globally, it has now become a leading educational establishment in the Malaysia as well.
Laureate said the reason why Malaysia was chosen as a preferred destination was its emphasis on infrastructure facilities and the government’s emphasis on developing Malaysia into an education hub.
In recent years, Kuala Lumpur, Petaling Jaya, Subang Jaya and Nilai have seen the mushrooming of many educational enclaves or precincts, attracting many foreign students in the process.
Malaysian educational players have also acquired smaller players and enlarged their base through listing their business as a way of tapping into greater capital resources as well as increasing student enrolment.
A case in point is HELP International Corporation Bhd and INTI Universal Holdings Bhd.
The listed holding companies of these educational establishments have strong collaboration with various overseas universities and attract many overseas students who want to acquire quality education at a reasonable cost.
Sapura Resources, which until recently held 100 per cent of APIT/UCTI Education, decided to divest 51 per cent of its stake to EKUINAS while holding the remaining 49 per cent along with management rights.
Now it appears both SAPURA and Ekuinas are in a better position to take advantage of the growth prospects of the fast-expanding education sector.
While some were quick to point out that Sapura was divesting from education, other observers argue that Sapura had in fact reinforced its commitment to the sector by getting a partner in order to grow its stake in the business. — Bernama
Real returns with smart investment strategies
Real returns with smart investment strategies
Posted on November 27, 2010, Saturday
SEE your nest egg flourish with smart investing. It’s all about how much you invest and how often.
Successful investing is not about taking big risks, but more about being able to balance risk and return by investing in a meaningful portfolio.
Use investment strategies that do work: a balanced allocation of your portfolio’s assets among securities that suit your individual needs, the use of Cost Averaging (CA) to lower the cost of overall investments and dividend reinvestment programmes, and a well disciplined, long haul approach to investing.
Most important factor you have in reaching your goals is time. The more time you have, the more chance you have of success. If you’re thinking of embarking on an investment strategy like CA, know your facts first.
For example, CA involves the regular purchase of units in a managed fund or shares over a period of time. It can be done automatically via an investment plan and you may reduce the risk associated with market fluctuations while giving your portfolio the best chance of long term profitability.
Here are options for you to choose from when it comes to investing in your future:
1.Direct investing
You invest directly in the share market, property or real estate investment trusts (REITs). The downside is that it generally requires market knowledge, plus regular monitoring of market trends, tax and legal changes. Many working adults don’t have access to the right market information or expertise to do direct investing well.
2.Buying bonds
The general principle of bond investing is that when you buy a bond, you are lending your money for a certain period of time to the issuer, be it a listed company or not. It’s a good choice for investors who require fixed horizon and steady income.
However, investing in bonds are usually for the high- net-worth and institutional investors as bonds are usually offered at a high entry cost, in hundreds of thousands or millions of ringgit.
Additionally, investors are advised to pay attention to total return, not just yield as bond prices fall when interest rates rise. An option for the retail investors to access the asset class will be to invest in unit trust bond fund due to its low entry cost and diverse holdings which allows for diversification.
3.Stocks/equities
Historically the best, but most volatile way to grow your money is through the stock market. On a short-term basis, stock prices fluctuate based on everything from interest rates to investor sentiment, to the weather. But on a long term basis, you could potentially make (or lose) a lot of your money in stock market. Bear in mind that risk and return come hand-in-hand.
4.Managed funds
If you only have a small sum to invest, a good option is to put your money in a managed or unit trust fund. These are funds which pool the investments from a number of investors, enable you to access markets and assets that may be expensive or difficult to buy directly into, such as the China’s restrictive A-share market, emerging markets and even the fixed income space such as government bonds.
Additionally, unit trust funds are a good alternative to buying individual stocks, where in exchange for a small fee you will have the advantage of participating in several stocks within a fund. What happens is that the fund manager trades the fund’s underlying securities, realising capital gains or losses, and collects the dividend or interest income. The proceeds are then passed along to the individual investors. Most funds require only moderate investments, ranging from a few hundred to a few thousand Ringgit.
This article is brought to you by HwangDBS Investment Management, your Asian Financial Specialists. Log on to www.hdbsim.com.my or call 1-800-88-7080 to find out how you can cost average your investment via the HwangDBS Smart Save Plan.
http://www.theborneopost.com/?p=77325
Posted on November 27, 2010, Saturday
SEE your nest egg flourish with smart investing. It’s all about how much you invest and how often.
Successful investing is not about taking big risks, but more about being able to balance risk and return by investing in a meaningful portfolio.
Use investment strategies that do work: a balanced allocation of your portfolio’s assets among securities that suit your individual needs, the use of Cost Averaging (CA) to lower the cost of overall investments and dividend reinvestment programmes, and a well disciplined, long haul approach to investing.
Most important factor you have in reaching your goals is time. The more time you have, the more chance you have of success. If you’re thinking of embarking on an investment strategy like CA, know your facts first.
For example, CA involves the regular purchase of units in a managed fund or shares over a period of time. It can be done automatically via an investment plan and you may reduce the risk associated with market fluctuations while giving your portfolio the best chance of long term profitability.
Here are options for you to choose from when it comes to investing in your future:
1.Direct investing
You invest directly in the share market, property or real estate investment trusts (REITs). The downside is that it generally requires market knowledge, plus regular monitoring of market trends, tax and legal changes. Many working adults don’t have access to the right market information or expertise to do direct investing well.
2.Buying bonds
The general principle of bond investing is that when you buy a bond, you are lending your money for a certain period of time to the issuer, be it a listed company or not. It’s a good choice for investors who require fixed horizon and steady income.
However, investing in bonds are usually for the high- net-worth and institutional investors as bonds are usually offered at a high entry cost, in hundreds of thousands or millions of ringgit.
Additionally, investors are advised to pay attention to total return, not just yield as bond prices fall when interest rates rise. An option for the retail investors to access the asset class will be to invest in unit trust bond fund due to its low entry cost and diverse holdings which allows for diversification.
3.Stocks/equities
Historically the best, but most volatile way to grow your money is through the stock market. On a short-term basis, stock prices fluctuate based on everything from interest rates to investor sentiment, to the weather. But on a long term basis, you could potentially make (or lose) a lot of your money in stock market. Bear in mind that risk and return come hand-in-hand.
4.Managed funds
If you only have a small sum to invest, a good option is to put your money in a managed or unit trust fund. These are funds which pool the investments from a number of investors, enable you to access markets and assets that may be expensive or difficult to buy directly into, such as the China’s restrictive A-share market, emerging markets and even the fixed income space such as government bonds.
Additionally, unit trust funds are a good alternative to buying individual stocks, where in exchange for a small fee you will have the advantage of participating in several stocks within a fund. What happens is that the fund manager trades the fund’s underlying securities, realising capital gains or losses, and collects the dividend or interest income. The proceeds are then passed along to the individual investors. Most funds require only moderate investments, ranging from a few hundred to a few thousand Ringgit.
This article is brought to you by HwangDBS Investment Management, your Asian Financial Specialists. Log on to www.hdbsim.com.my or call 1-800-88-7080 to find out how you can cost average your investment via the HwangDBS Smart Save Plan.
http://www.theborneopost.com/?p=77325
Cocoaland’s new product line to be postponed
Cocoaland’s new product line to be postponed
Posted on November 23, 2010, Tuesday
KUCHING: Candymaker, Cocoaland Holdings Bhd (Cocoaland) postponed its proposed Cocopie and Gummy line of products as it was still scouring for a new plant to accommodate the additional lines.
In its research report, TA Securities Holdings Bhd (TA Securities) said the lines were expected to be completed and up-and-running in a year’s time.
On another note, Cocoaland was still in the trial-testing stage for original equipment manufacturers (OEMs) with big multinational corporations (MNCs) and thus, none would be reflected in its earnings this year.
In addition, the company which had begun marketing its own brands Fruit Ten and Cha in the market had been met with mundane response.
This was probably expected, as Cocoaland’s brand name was still relatively new in the Fraser and Neave Holdings Bhd (F&N) and Yeo Hiap Seng (M) Bhd (Yeo’s) dominated market, according to the research house.
It also mentioned that product and brand recognition traditionally took two to three years, but with Cocoaland’s synergistic relationship with F&N, it might allow Cocoaland’s products a shorter time to achieve that milestone thanks to F&N’s wide distribution network.
Furthermore, the research firm also commented on the company’s skyrocketing costs. The average price of sugar had increased more than 30 per cent year-to-date, cocoa powder by more than 20 per cent, packaging by more than 10 per cent and glucose by more than 15 per cent.
This was only partially mitigated by the weaker US dollar since 40 per cent of its sales were denominated in US dollars. TA Securities stated that trends were moving towards passing the costs to the consumers in the form of increasing selling prices by five per cent to 10 per cent.
Given the current circumstances, the research house expected net profit to be less than RM10 million on the back of weak first half of the year results in addition to operating losses of its beverage plant.
It pegged Cocoaland’s target price at RM2.14 per share based on financial year 2011 price earnings ratio of 16 times.
http://www.theborneopost.com/?p=76611
Posted on November 23, 2010, Tuesday
KUCHING: Candymaker, Cocoaland Holdings Bhd (Cocoaland) postponed its proposed Cocopie and Gummy line of products as it was still scouring for a new plant to accommodate the additional lines.
In its research report, TA Securities Holdings Bhd (TA Securities) said the lines were expected to be completed and up-and-running in a year’s time.
On another note, Cocoaland was still in the trial-testing stage for original equipment manufacturers (OEMs) with big multinational corporations (MNCs) and thus, none would be reflected in its earnings this year.
In addition, the company which had begun marketing its own brands Fruit Ten and Cha in the market had been met with mundane response.
This was probably expected, as Cocoaland’s brand name was still relatively new in the Fraser and Neave Holdings Bhd (F&N) and Yeo Hiap Seng (M) Bhd (Yeo’s) dominated market, according to the research house.
It also mentioned that product and brand recognition traditionally took two to three years, but with Cocoaland’s synergistic relationship with F&N, it might allow Cocoaland’s products a shorter time to achieve that milestone thanks to F&N’s wide distribution network.
Furthermore, the research firm also commented on the company’s skyrocketing costs. The average price of sugar had increased more than 30 per cent year-to-date, cocoa powder by more than 20 per cent, packaging by more than 10 per cent and glucose by more than 15 per cent.
This was only partially mitigated by the weaker US dollar since 40 per cent of its sales were denominated in US dollars. TA Securities stated that trends were moving towards passing the costs to the consumers in the form of increasing selling prices by five per cent to 10 per cent.
Given the current circumstances, the research house expected net profit to be less than RM10 million on the back of weak first half of the year results in addition to operating losses of its beverage plant.
It pegged Cocoaland’s target price at RM2.14 per share based on financial year 2011 price earnings ratio of 16 times.
http://www.theborneopost.com/?p=76611
DISCOVER the key to long term financial success – through asset allocation.
Finding the right solution
by HWANGDBS Column. Posted on November 20, 2010, Saturday
DISCOVER the key to long term financial success – through asset allocation.
Asset allocation seeks to find the optimal investment mix while minimising your risks to help you achieve your goals. It allows you to spread your money across the asset classes – shares, bonds, Exchange Traded Funds (ETFs), commodities, property and cash to name a few, as different assets behave differently under different economic environments.
Ideally, both asset allocation and diversifying your investments should be done with meaningful returns and not for the sake of diversifying as it may dilute your returns. Portfolio rebalancing is needed, at least, on an annual basis to ensure everything is on track.
The asset allocation that works best for you at any given point in your life will depend largely on your time horizon and your ability to tolerate risk. Your goal should be to maximise your return for the amount of risk that you are comfortable accepting. To help you do that, you need a well allocated and diversified portfolio. Asset allocation can help you:
1.Ensure consistent returns over time. You’ll improve your chances of participating in market gains and potentially reduce the impact of poor performing asset categories by investing in several asset classes.
2. Reduce overall risk. Through portfolio diversification you can limit the volatility in your portfolio while improving its performance, by spreading the risk among different types of securities that don’t always behave the same.
3. Move forward towards attaining your goals. A well-allocated portfolio can reduce the need to constantly adjust investment positions in order to chase market trends.
Sorting out which works best
It’s important that your investments are allocated over a variety of asset classes as each asset class performs differently over time due to its unique balance of risk and reward. Over time and through your different life stages, the various investments in your portfolio may alter in value, due to changing market conditions.
Rebalance it regularly to effectively pursue your financial goals. This could mean realising your gains on portions of your investments or cutting your losses on others. The funds can then be used to purchase other assets in order to bring your portfolio back on track annually.
Discover your type
Which type of investor are you? Check out these categories on www.hdbsim.com.my
• The young and the restless. Managing your finances at such an early stage will allow you to reap the rewards of long-term planning, enabling you to comfortably afford things that are important to you like a new home, further education, or even a baby.
• Wonder women sexy, savvy and successful. You pride yourself on your accomplishments and there is no doubting your purchasing power. You understand that investing smartly is the key to reaching one of your ultimate goals: financial freedom.
• The family way planning and informed financial decisions requires time, effort and patience as well as access to the best investment solutions that will be the foundation for your family’s financial stability.
• Top of the hill. You are no stranger to investment risk. Your keen insight and uncanny judgment have brought you to where you are today. Isn’t it time you get everything you want?
• The golden years. Now that you are financially liberated and free of the encumbrances of your career, you can indulge in the things you love the most… but that is assuming you planned well for your retirement.
This article is brought to you by HwangDBS Investment Management
http://www.theborneopost.com/?p=76157
by HWANGDBS Column. Posted on November 20, 2010, Saturday
DISCOVER the key to long term financial success – through asset allocation.
Asset allocation seeks to find the optimal investment mix while minimising your risks to help you achieve your goals. It allows you to spread your money across the asset classes – shares, bonds, Exchange Traded Funds (ETFs), commodities, property and cash to name a few, as different assets behave differently under different economic environments.
Ideally, both asset allocation and diversifying your investments should be done with meaningful returns and not for the sake of diversifying as it may dilute your returns. Portfolio rebalancing is needed, at least, on an annual basis to ensure everything is on track.
The asset allocation that works best for you at any given point in your life will depend largely on your time horizon and your ability to tolerate risk. Your goal should be to maximise your return for the amount of risk that you are comfortable accepting. To help you do that, you need a well allocated and diversified portfolio. Asset allocation can help you:
1.Ensure consistent returns over time. You’ll improve your chances of participating in market gains and potentially reduce the impact of poor performing asset categories by investing in several asset classes.
2. Reduce overall risk. Through portfolio diversification you can limit the volatility in your portfolio while improving its performance, by spreading the risk among different types of securities that don’t always behave the same.
3. Move forward towards attaining your goals. A well-allocated portfolio can reduce the need to constantly adjust investment positions in order to chase market trends.
Sorting out which works best
It’s important that your investments are allocated over a variety of asset classes as each asset class performs differently over time due to its unique balance of risk and reward. Over time and through your different life stages, the various investments in your portfolio may alter in value, due to changing market conditions.
Rebalance it regularly to effectively pursue your financial goals. This could mean realising your gains on portions of your investments or cutting your losses on others. The funds can then be used to purchase other assets in order to bring your portfolio back on track annually.
Discover your type
Which type of investor are you? Check out these categories on www.hdbsim.com.my
• The young and the restless. Managing your finances at such an early stage will allow you to reap the rewards of long-term planning, enabling you to comfortably afford things that are important to you like a new home, further education, or even a baby.
• Wonder women sexy, savvy and successful. You pride yourself on your accomplishments and there is no doubting your purchasing power. You understand that investing smartly is the key to reaching one of your ultimate goals: financial freedom.
• The family way planning and informed financial decisions requires time, effort and patience as well as access to the best investment solutions that will be the foundation for your family’s financial stability.
• Top of the hill. You are no stranger to investment risk. Your keen insight and uncanny judgment have brought you to where you are today. Isn’t it time you get everything you want?
• The golden years. Now that you are financially liberated and free of the encumbrances of your career, you can indulge in the things you love the most… but that is assuming you planned well for your retirement.
This article is brought to you by HwangDBS Investment Management
http://www.theborneopost.com/?p=76157
Boustead assets sale a positive step forward
Boustead assets sale a positive step forward – Analysts
by Ronnie Teo ronnieteo@theborneopost.com. Posted on November 13, 2010, Saturday
KUCHING: Boustead Holdings Bhd’s (Boustead) proposed sale and leaseback agreement with Al-Hadharah Boustead Real Estate Investment Trust (AHBREIT) for its plantation assets was seen as a positive step forward by analysts.
PROFIT SHARING AGREEMENT: Ching says the variable rental payment will be based on a CPO price reference and there will be a profit-share agreement between Boustead and AHBREIT for any price of CPO sold above the reference price.
Hong Leong Investment Bank Bhd’s (HL Research) analyst noted that the proposed sale and leaseback of Sutera Estate in Sandakan and Taiping Rubber Plantation to AHBREIT was for a cash consideration of RM189.2 million.
“We view this positively due to interest savings and the reduction in gearing for Boustead,” he said.
According to ECM Libra Capital Sdn Bhd’s (ECM Libra) head analyst Bernard Ching, Boustead would profit by RM97.7 million in net gains from this venture along with an estimated interest savings of RM9.5 million for the financial year 2011 as reported by the group.
“The 3,580 hectare going into AHBREIT will still be captured by the group under its total hectarage calculation because it still gets to participate in the profits of the estates,” Ching pointed out. “As part of the leaseback agreement, Boustead will pay AHBREIT a fixed rental payment and also a variable rental payment.
“The variable rental payment will be based on a crude palm oil (CPO) price reference and there will be a profit-share agreement between Boustead and AHBREIT for any price of CPO sold above the reference price.”
Ching noted that the along with this new agreement, a new reference price and rental rates would be determined and known by next year.
“The agreement is as such that it has neutral impact to Boustead’s earnings, even in times like these when CPO prices are high.
“After all, Boustead’s 100 per cent owned subsidiary, Boustead Plantations Bhd does have a 60 per cent stake in AHBREIT and earns distributions and profit shares from the REIT,” he concluded.
http://www.theborneopost.com/?p=74821
by Ronnie Teo ronnieteo@theborneopost.com. Posted on November 13, 2010, Saturday
KUCHING: Boustead Holdings Bhd’s (Boustead) proposed sale and leaseback agreement with Al-Hadharah Boustead Real Estate Investment Trust (AHBREIT) for its plantation assets was seen as a positive step forward by analysts.
PROFIT SHARING AGREEMENT: Ching says the variable rental payment will be based on a CPO price reference and there will be a profit-share agreement between Boustead and AHBREIT for any price of CPO sold above the reference price.
Hong Leong Investment Bank Bhd’s (HL Research) analyst noted that the proposed sale and leaseback of Sutera Estate in Sandakan and Taiping Rubber Plantation to AHBREIT was for a cash consideration of RM189.2 million.
“We view this positively due to interest savings and the reduction in gearing for Boustead,” he said.
According to ECM Libra Capital Sdn Bhd’s (ECM Libra) head analyst Bernard Ching, Boustead would profit by RM97.7 million in net gains from this venture along with an estimated interest savings of RM9.5 million for the financial year 2011 as reported by the group.
“The 3,580 hectare going into AHBREIT will still be captured by the group under its total hectarage calculation because it still gets to participate in the profits of the estates,” Ching pointed out. “As part of the leaseback agreement, Boustead will pay AHBREIT a fixed rental payment and also a variable rental payment.
“The variable rental payment will be based on a crude palm oil (CPO) price reference and there will be a profit-share agreement between Boustead and AHBREIT for any price of CPO sold above the reference price.”
Ching noted that the along with this new agreement, a new reference price and rental rates would be determined and known by next year.
“The agreement is as such that it has neutral impact to Boustead’s earnings, even in times like these when CPO prices are high.
“After all, Boustead’s 100 per cent owned subsidiary, Boustead Plantations Bhd does have a 60 per cent stake in AHBREIT and earns distributions and profit shares from the REIT,” he concluded.
http://www.theborneopost.com/?p=74821
Latexx advances market share
Latexx advances market share
by Justin Yap. Posted on November 11, 2010, Thursday
Company to focus on premium segments to cope with temporary headwinds
HIGH-TECH PRODUCTION: Photo shows a Latexx employee working with an incubator machine.
KUCHING: Latexx Partners Bhd’s (Latexx) ability to pass on costs to customers, coupled with its strategies to focus on the premium segments has enabled it to cope with the temporary headwinds and move on to advance its market presence.
Latexx announced results for the third quarter ended September 30, 2010 (3Q10) yesterday. The group recorded revenue of RM129.88 million for 3Q10, a 60.7 per cent growth from the same quarter a year ago (3Q09). For the current quarter, the group achieved net profit of RM17.63 million.
For the current year to date, the group sales revenue for the nine months ended September 30, 2010 increased 73.1 per cent to RM390.53 million from RM225.59 million for the corresponding period last year.
“The significant increase in revenue and improve-ment in the net profit of the current year was mainly due to the increase in overall sales volume, driven by the strong demand of gloves and the group’s capacity expansion,” said its chief executive officer (CEO) and chairman Low Bok Tek when contacted by The Borneo Post.
“The stronger performance was also attributed by measures taken to improve the efficiency in operation control as well as the intensified and aggressive marketing strategy,” he added.
The balance sheet position of the group continued to strengthen in 3Q10 compared with the preceding quarter. The net cash flow from operating activities as at September 30, 2010 was RM55.6 million, 30.8 per cent higher than the previous quarter of RM42.5 million.
When asked on the market glove demand, Low explained, “It had remained healthy although the concern for H1N1 had faded. Upon normalising, the demand for gloves still grew at 10 per cent to 12 per cent annually, which indicates a remarkable upside for any industry.
“Over the years, growing hygiene awareness and increased healthcare spending have made gloves a necessity in the healthcare sector, especially, in developed economies, thus making the industry resilient even when economy is slowing down.”
Looking at its strategic market positioning with thin nitrile gloves in the non-medical sector, Latexx head of corporate services Dr Liew Lai Lai said, “The sustained high level of latex prices is still the biggest challenge faced by all glove makers. Keeping abreast with the changing industry landscape, we have since adopted a few contingency strategies to adapt itself to the environment.
“Besides continuing to place more focus on the premium product segment that is relatively more resilient, we have also started offering a range of thinner, good quality and more price competitive nitrile gloves to both the medical and non-medical sector.”
Currently, almost 90 per cent of the group’s sales were to the medical sector; hence, the group was aiming to enlarge its revenue base by venturing into the non-medical sector. Latexx projected its range of thin and value priced nitrile gloves would be able to effectively substitute the lower-end natural rubber (NR) powdered gloves in the food and industrial market segment.
Latexx further foresaw that the latex price in the future would be lingering on the increasing trend and it believed that the sales of its range of thin nitrile gloves would increase substantially and significantly boost the revenue and profitability of the group by 2011.
The company also has strategically positioned itself in the premium NR gloves segment, with the launching of the first-in-the world NR powder-free gloves with unquantifiable protein level.
“This premium product range is currently the most effective solution to the threats of protein allergy for glove users,” said Liew.
“Based on the initial market response that we managed to obtain at this stage, the market is responding well and we strongly believes that these value-added natural latex gloves are able to create a demand and be widely accepted by the market and industry globally,” added Low.
He also revealed that the construction of an additional production plant adjacent to existing production facilities had been completed. The commissioning of glove production lines was done in accordance to schedule.
“Nine double formers and two single formers glove production lines were commissioned and have since started operation. The commissioning of the remaining glove production lines is in progress and is expected to increase the total capacity to nine billion pieces per annum by next year,” said the chairman.
The group continued to see a strong performance in its business for the remaining quarter of the year. “The board of directors expects the demand for the products and services to improve further in the fourth quarter and the business to remain strong until end of the financial year,” Liew concluded.
http://www.theborneopost.com/?p=74376
by Justin Yap. Posted on November 11, 2010, Thursday
Company to focus on premium segments to cope with temporary headwinds
HIGH-TECH PRODUCTION: Photo shows a Latexx employee working with an incubator machine.
KUCHING: Latexx Partners Bhd’s (Latexx) ability to pass on costs to customers, coupled with its strategies to focus on the premium segments has enabled it to cope with the temporary headwinds and move on to advance its market presence.
Latexx announced results for the third quarter ended September 30, 2010 (3Q10) yesterday. The group recorded revenue of RM129.88 million for 3Q10, a 60.7 per cent growth from the same quarter a year ago (3Q09). For the current quarter, the group achieved net profit of RM17.63 million.
For the current year to date, the group sales revenue for the nine months ended September 30, 2010 increased 73.1 per cent to RM390.53 million from RM225.59 million for the corresponding period last year.
“The significant increase in revenue and improve-ment in the net profit of the current year was mainly due to the increase in overall sales volume, driven by the strong demand of gloves and the group’s capacity expansion,” said its chief executive officer (CEO) and chairman Low Bok Tek when contacted by The Borneo Post.
“The stronger performance was also attributed by measures taken to improve the efficiency in operation control as well as the intensified and aggressive marketing strategy,” he added.
The balance sheet position of the group continued to strengthen in 3Q10 compared with the preceding quarter. The net cash flow from operating activities as at September 30, 2010 was RM55.6 million, 30.8 per cent higher than the previous quarter of RM42.5 million.
When asked on the market glove demand, Low explained, “It had remained healthy although the concern for H1N1 had faded. Upon normalising, the demand for gloves still grew at 10 per cent to 12 per cent annually, which indicates a remarkable upside for any industry.
“Over the years, growing hygiene awareness and increased healthcare spending have made gloves a necessity in the healthcare sector, especially, in developed economies, thus making the industry resilient even when economy is slowing down.”
Looking at its strategic market positioning with thin nitrile gloves in the non-medical sector, Latexx head of corporate services Dr Liew Lai Lai said, “The sustained high level of latex prices is still the biggest challenge faced by all glove makers. Keeping abreast with the changing industry landscape, we have since adopted a few contingency strategies to adapt itself to the environment.
“Besides continuing to place more focus on the premium product segment that is relatively more resilient, we have also started offering a range of thinner, good quality and more price competitive nitrile gloves to both the medical and non-medical sector.”
Currently, almost 90 per cent of the group’s sales were to the medical sector; hence, the group was aiming to enlarge its revenue base by venturing into the non-medical sector. Latexx projected its range of thin and value priced nitrile gloves would be able to effectively substitute the lower-end natural rubber (NR) powdered gloves in the food and industrial market segment.
Latexx further foresaw that the latex price in the future would be lingering on the increasing trend and it believed that the sales of its range of thin nitrile gloves would increase substantially and significantly boost the revenue and profitability of the group by 2011.
The company also has strategically positioned itself in the premium NR gloves segment, with the launching of the first-in-the world NR powder-free gloves with unquantifiable protein level.
“This premium product range is currently the most effective solution to the threats of protein allergy for glove users,” said Liew.
“Based on the initial market response that we managed to obtain at this stage, the market is responding well and we strongly believes that these value-added natural latex gloves are able to create a demand and be widely accepted by the market and industry globally,” added Low.
He also revealed that the construction of an additional production plant adjacent to existing production facilities had been completed. The commissioning of glove production lines was done in accordance to schedule.
“Nine double formers and two single formers glove production lines were commissioned and have since started operation. The commissioning of the remaining glove production lines is in progress and is expected to increase the total capacity to nine billion pieces per annum by next year,” said the chairman.
The group continued to see a strong performance in its business for the remaining quarter of the year. “The board of directors expects the demand for the products and services to improve further in the fourth quarter and the business to remain strong until end of the financial year,” Liew concluded.
http://www.theborneopost.com/?p=74376
Supermax to increase nitrile glove mix to about 30 per cent
Supermax to increase nitrile glove mix to about 30 per cent
Posted on November 11, 2010, Thursday
KUCHING: Supermax Corporation Bhd (Supermax) plans to increase the nitrile glove mix to about 30 per cent by gradually converting its existing natural rubber powder-free production lines to nitrile lines.
Currently, Supermax produces a mix of 80 per cent natural rubber gloves and 20 per cent nitrile.
OSK Research Sdn Bhd (OSK Research) understood that about 70 per cent of all its lines were convertible, except for the remaining 30 per cent, which were dedicated for the production of natural rubber powder gloves.
The research house pointed out that this change in product mix was in tandem with the more stable demand for nitrile gloves.
OSK Research understood that management also intended to increase its current production of about 20,000 pairs per annum (p.a) to 2.5 million p.a by end-2011.
This was in line with its plan to gradually tweak its product mix towards higher margin gloves.
As mentioned before, management expected to increase its total capacity by 3.1 billion pieces of gloves by end-2010 and another 4.1 billion at end-2011, bringing its annual capacity to 21.7 billion pieces by end-2011.
The research house noted that management anticipated latex prices to peak at about RM8.50 per kilogramme (kg) at end-2010 followed by a fall in the first quarter of the financial year 2011 (1QFY11) despite the fact that rubber trees would be undergoing their winter season.
This was because management believed the current price run-up was fuelled by speculation rather than being due to actual shortage.
OSK Research’s target price for the company was RM7.84 per share based on a price earnings ratio of 13 times financial year 2011 (FY11) earnings per share (EPS).
Going forward to FY11, management expected a net profit growth of about 20 per cent, contributed by higher associate contribution, the establishment of more regional distribution centres and the production of higher margin examination gloves.
http://www.theborneopost.com/?p=74547
Posted on November 11, 2010, Thursday
KUCHING: Supermax Corporation Bhd (Supermax) plans to increase the nitrile glove mix to about 30 per cent by gradually converting its existing natural rubber powder-free production lines to nitrile lines.
Currently, Supermax produces a mix of 80 per cent natural rubber gloves and 20 per cent nitrile.
OSK Research Sdn Bhd (OSK Research) understood that about 70 per cent of all its lines were convertible, except for the remaining 30 per cent, which were dedicated for the production of natural rubber powder gloves.
The research house pointed out that this change in product mix was in tandem with the more stable demand for nitrile gloves.
OSK Research understood that management also intended to increase its current production of about 20,000 pairs per annum (p.a) to 2.5 million p.a by end-2011.
This was in line with its plan to gradually tweak its product mix towards higher margin gloves.
As mentioned before, management expected to increase its total capacity by 3.1 billion pieces of gloves by end-2010 and another 4.1 billion at end-2011, bringing its annual capacity to 21.7 billion pieces by end-2011.
The research house noted that management anticipated latex prices to peak at about RM8.50 per kilogramme (kg) at end-2010 followed by a fall in the first quarter of the financial year 2011 (1QFY11) despite the fact that rubber trees would be undergoing their winter season.
This was because management believed the current price run-up was fuelled by speculation rather than being due to actual shortage.
OSK Research’s target price for the company was RM7.84 per share based on a price earnings ratio of 13 times financial year 2011 (FY11) earnings per share (EPS).
Going forward to FY11, management expected a net profit growth of about 20 per cent, contributed by higher associate contribution, the establishment of more regional distribution centres and the production of higher margin examination gloves.
http://www.theborneopost.com/?p=74547
Investing with the big picture in mind
Investing with the big picture in mind
Posted on November 6, 2010, Saturday
YOU don’t have to be an expert to get started, but it helps to know the basics before you set a plan for investing. Since the whole idea of investing can be overwhelming and intimidating for anyone who has never done it, try taking small steps.
Here are some basic Do’s
•Do:
•Get some financial education.
•Invest some time, then money.
•Read books and newspapers.
Attend seminars.
Get together with other like-minded people to learn about investment choices including the stock market, property or even a business.
You might also consider hiring a professional, like a financial planner to go through your current financial situation and goals, and work out a detailed financial plan for you. Besides giving you a professional perspective of your financial health, a good financial planner will know the kind of products in the market that will suit you.
But professional help doesn’t come cheap. So the best option would be to get a recommendation from neutral or independent sources such as the Financial Planning Association of Malaysia (FPAM) or the Securities Commission Malaysia before settling on a planner.
Always remember the three important principles of investing:
1. Investment Goals
What is the purpose of your investment? Is it to achieve high dividend yields or a consistent income yield? Once you’ve determined your short-term and long-term objectives, you can identify suitable investments, the level of risk you can tolerate, and what your expectations are.
2. Know your risk tolerance
High returns come with equally high risk. Realise your ability and willingness to lose some or all of your original investment in exchange for greater potential returns.
If you’re an aggressive investor, or one with a high-risk tolerance, a well-diversified equity fund should take up the majority of your portfolio. If you can take on only a moderate degree of risk, then perhaps a hybrid investment plan such as a 50:50 investment portfolio in a moderate risk fund with significant cash savings in a bank account is your calling.
3. Time horizon
Decide on how long you intend to invest and what stage of your life you’re at. If you are saving up for your daughter’s education in which you will need it in the near future such as within five years, then, you would likely to take on less risk because of a shorter time horizon. Also, maintain at least six month’s income in an easily accessible deposit account or put your money in liquid investments such as unit trust funds. This will allow you to have access to your money in the event of emergencies.
Here are two examples* to give you a general idea:
Scenario 1:
Sharon decides to start investing a sum of RM500 monthly, in an investment vehicle that will yield her an average of eight per cent per annum over the next 30 years till retirement. At the end of 30 years, the total sum of her investment would have amounted to RM750,000.
Scenario 2:
If Sharon decides to start investing five years later, a sum of RM500 monthly, in a similar investment vehicle that will yield her an average of eight per cent per annum over a period of 25 years till retirement, her total nest egg would have only amounted to RM478,000 due to the loss of an additional five years in compounded growth.
* Source: Investment Calculator from HwangDBS Investment Management corporate website www.hdbsim.com.my/tools/general-investment
This article is brought to you by HwangDBS Investment Management, your Asian Financial Specialists; we believe you deserve to live the life you want.
http://www.theborneopost.com/?p=73323
Posted on November 6, 2010, Saturday
YOU don’t have to be an expert to get started, but it helps to know the basics before you set a plan for investing. Since the whole idea of investing can be overwhelming and intimidating for anyone who has never done it, try taking small steps.
Here are some basic Do’s
•Do:
•Get some financial education.
•Invest some time, then money.
•Read books and newspapers.
Attend seminars.
Get together with other like-minded people to learn about investment choices including the stock market, property or even a business.
You might also consider hiring a professional, like a financial planner to go through your current financial situation and goals, and work out a detailed financial plan for you. Besides giving you a professional perspective of your financial health, a good financial planner will know the kind of products in the market that will suit you.
But professional help doesn’t come cheap. So the best option would be to get a recommendation from neutral or independent sources such as the Financial Planning Association of Malaysia (FPAM) or the Securities Commission Malaysia before settling on a planner.
Always remember the three important principles of investing:
1. Investment Goals
What is the purpose of your investment? Is it to achieve high dividend yields or a consistent income yield? Once you’ve determined your short-term and long-term objectives, you can identify suitable investments, the level of risk you can tolerate, and what your expectations are.
2. Know your risk tolerance
High returns come with equally high risk. Realise your ability and willingness to lose some or all of your original investment in exchange for greater potential returns.
If you’re an aggressive investor, or one with a high-risk tolerance, a well-diversified equity fund should take up the majority of your portfolio. If you can take on only a moderate degree of risk, then perhaps a hybrid investment plan such as a 50:50 investment portfolio in a moderate risk fund with significant cash savings in a bank account is your calling.
3. Time horizon
Decide on how long you intend to invest and what stage of your life you’re at. If you are saving up for your daughter’s education in which you will need it in the near future such as within five years, then, you would likely to take on less risk because of a shorter time horizon. Also, maintain at least six month’s income in an easily accessible deposit account or put your money in liquid investments such as unit trust funds. This will allow you to have access to your money in the event of emergencies.
Here are two examples* to give you a general idea:
Scenario 1:
Sharon decides to start investing a sum of RM500 monthly, in an investment vehicle that will yield her an average of eight per cent per annum over the next 30 years till retirement. At the end of 30 years, the total sum of her investment would have amounted to RM750,000.
Scenario 2:
If Sharon decides to start investing five years later, a sum of RM500 monthly, in a similar investment vehicle that will yield her an average of eight per cent per annum over a period of 25 years till retirement, her total nest egg would have only amounted to RM478,000 due to the loss of an additional five years in compounded growth.
* Source: Investment Calculator from HwangDBS Investment Management corporate website www.hdbsim.com.my/tools/general-investment
This article is brought to you by HwangDBS Investment Management, your Asian Financial Specialists; we believe you deserve to live the life you want.
http://www.theborneopost.com/?p=73323
QL is estimated to need about RM 250 million per annum for FY 2011 to FY 2012 to finance its expansion plans
QL Resources to increase production capacity
Posted on November 5, 2010, Friday
KUCHING: QL Resources Bhd’s (QL Resources) recent proposal to undertake a private placement, share split and issuance of free warrants was aimed at increasing its production capacity in its existing poultry farms in Malaysia.
According to Kenanga Investment Bank Bhd (Kenanga Research), the proposed placement of 20,827,920 shares of RM0.50 each to third-party investors was expected to be completed prior to the proposed share split and free warrants issue, to be completed by the first quarter of 2011.
Assuming a five per cent discount from the five-day weighted average market price of RM5.26, the proposed placement was expected to raise gross proceeds of up to approximately RM104 million.
The research house stated that about 70 per cent of the proceeds from the private placement would go to increasing its production capacity in existing poultry farms in the country apart from developing poultry farms in Indonesia and Vietnam.
In addition, the proceeds would be utilised for QL Resources’ plantation development and oil mill construction in its 20,000-hectare plantation in Indonesia apart from development of its biomass renewable energy projects in Tawau, Sabah.
The group’s proposed share split would entail the subdivision of one existing ordinary share of RM0.50 into two shares held by entitled shareholders to increase affordability of its shares and encourage retail participation.
With regards to the group’s proposed free warrants, the research firm said it would be issued free to existing shareholders on the basis of one free warrant for every 20 existing QL Resources shares after the private placement and share split.
RHB Research Institute Sdn Bhd (RHB Research) in its research report said that it had previously highlighted the group to do a corporate exercise to raise capital as it had estimated a need for about RM250 million per annum for the financial years 2011 to 2012 (FY11 to FY12) to finance its expansion plans.
The research firm sustained a positive view on this move, stating that it would enable the group to lower its net gearing at 54 per cent by the third quarter of FY2011 against a current approximation of 60 per cent.
Posted on November 5, 2010, Friday
KUCHING: QL Resources Bhd’s (QL Resources) recent proposal to undertake a private placement, share split and issuance of free warrants was aimed at increasing its production capacity in its existing poultry farms in Malaysia.
According to Kenanga Investment Bank Bhd (Kenanga Research), the proposed placement of 20,827,920 shares of RM0.50 each to third-party investors was expected to be completed prior to the proposed share split and free warrants issue, to be completed by the first quarter of 2011.
Assuming a five per cent discount from the five-day weighted average market price of RM5.26, the proposed placement was expected to raise gross proceeds of up to approximately RM104 million.
The research house stated that about 70 per cent of the proceeds from the private placement would go to increasing its production capacity in existing poultry farms in the country apart from developing poultry farms in Indonesia and Vietnam.
In addition, the proceeds would be utilised for QL Resources’ plantation development and oil mill construction in its 20,000-hectare plantation in Indonesia apart from development of its biomass renewable energy projects in Tawau, Sabah.
The group’s proposed share split would entail the subdivision of one existing ordinary share of RM0.50 into two shares held by entitled shareholders to increase affordability of its shares and encourage retail participation.
With regards to the group’s proposed free warrants, the research firm said it would be issued free to existing shareholders on the basis of one free warrant for every 20 existing QL Resources shares after the private placement and share split.
RHB Research Institute Sdn Bhd (RHB Research) in its research report said that it had previously highlighted the group to do a corporate exercise to raise capital as it had estimated a need for about RM250 million per annum for the financial years 2011 to 2012 (FY11 to FY12) to finance its expansion plans.
The research firm sustained a positive view on this move, stating that it would enable the group to lower its net gearing at 54 per cent by the third quarter of FY2011 against a current approximation of 60 per cent.
Budget 2011 boost for Economic Transformation Programme
Budget 2011 boost for Economic Transformation Programme
Posted on October 17, 2010, Sunday
PUTRAJAYA: Pemandu has received the necessary allocations to carry out the implementation of its Government Transformation Programme (GTP) and Economic Transformation Programme (ETP) initiative in 2011.
“The budget allocations clearly demonstrated the Government’s commitment to ETP. This will enable us to put up the eight per cent public funding required to catalyse the 92 per cent private sector investment.
“As the ETP is co-created by the private sector from the ground up through a 1,000-person workshop and 500-person nine-week lab, we now need the private sector to deliver on its promise,” said Senator Datuk Sri Idris Jala, Minister in the Prime Minister’s Department and chief executive officer of Pemandu.
“The estimated growths of 10.2 per cent and 6.3 per cent for private sector investments and private consumption respectively are aligned with the ETP’s strategy for a private sector-led and a more private consumption-driven economic expansion,” he added.
The ETP initiatives covered in the 2011 Budget include:
http://www.theborneopost.com/?p=69175
Posted on October 17, 2010, Sunday
PUTRAJAYA: Pemandu has received the necessary allocations to carry out the implementation of its Government Transformation Programme (GTP) and Economic Transformation Programme (ETP) initiative in 2011.
“The budget allocations clearly demonstrated the Government’s commitment to ETP. This will enable us to put up the eight per cent public funding required to catalyse the 92 per cent private sector investment.
“As the ETP is co-created by the private sector from the ground up through a 1,000-person workshop and 500-person nine-week lab, we now need the private sector to deliver on its promise,” said Senator Datuk Sri Idris Jala, Minister in the Prime Minister’s Department and chief executive officer of Pemandu.
“The estimated growths of 10.2 per cent and 6.3 per cent for private sector investments and private consumption respectively are aligned with the ETP’s strategy for a private sector-led and a more private consumption-driven economic expansion,” he added.
The ETP initiatives covered in the 2011 Budget include:
- the Mass Rapid Transit (MRT) in Greater Kuala Lumpur/Klang Valley
- measures to revitalise the domestic capital market
- the launch of a Private Pension Fund
- RM857 million allocation for local Electrical and Electronics sector
- RM146 million allocation for the Oil, Gas and Energy industry
- RM3.8 billion allocation to increase productivity and generate higher returns in the agriculture sector
- RM85 million allocation for infrastructure facilities to facilitate construction of hotels and resorts in remote areas, and RM100 million allocation to further support the tourism industry
- the RM3 billion eco-nature resort in Sabah
- the abolishment of existing import duty of between five to 30 per cent on approximately 300 goods
- RM297 million allocation to support palm oil replanting activities
- RM127m allocation to support domestic oleo derivatives companies and RM23.3m to expand downstream palm oil industries
- The set-up of the Wage Consultation Council to determine the rate and mechanism of the minimum wage policy
- Allocation for Wholesale and Retail sector activities such as Tukar, Pakar and automotive workshop transformation.
http://www.theborneopost.com/?p=69175
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