FBMKLCI
1866.11 -9.57pts (-0.51%)
Volume 3.227b Value 2.854b
1) The KLCI
experienced profit taking ahead of the long Merdeka weekend and the end of a
sluggish reporting season, while renewed concerns on Ukraine crisis added to
the negative sentiment. In the regional market, bourses were mixed with NIKKEI
-0.23%, HIS+0.0%, SHCOMP +0.97% as investors sentiment turned cautious while
Japan saw household spending worse than expected. In the local scene, CONSUMER
PRODUCTS index saw heavy losses weighed down by TCHONG -6.45%, KAREX -3.45%, QL
-2.64%, BAT -1.02%. Market breadth was negative with losers thumping gainers
660 : 251. Futures closed at 1871 (5pts premium)
2) Heavyweights : SKPETRO -2.54% RM4.22, GENM -3.01%
RM4.51, PCHEM -1.87% RM6.30, YTL +3.85% RM1.62, GENTING -1.24% RM10.06, FGV
-2.80% RM 3.82, TENAGA -0.48% RM12.38, PETDAG -2.99% RM20.10.
3) DBT : NEXGRAM 28.6mil @ RM0.13 (4.0% premium), FURNWEB
25.2mil @ RM0.75 (17.37% PUC @ 16.7% discount), SILKHLD 20mil @ RM1.05 (3.88%
PUC @ 7.14% premium), YINSON 3.0mil @ RM2.96.
4) Situational:-
FGV -2.80% RM3.82 - Felda Global Ventures Holdings Bhd is
planning a take-over offer for London-listed Asian Plantations Ltd at GBP2.20
(RM11.50) per share or RM627mil. The acquisition will enable FGV to capitalize
on APL's oil plantations in Sarawak increasing its landbank by approximately
24,622 hectares.
5) CIMB
1HFY14 Tover-6%
RM6,945m Net-17.4% RM2,016m Eps 24.56sen Div 10sen
43.5% of FY consensus RM4,636m
Yoy, Excluding RM365mil net gain from the sale of CIMB
Aviva, net profit was lower by 2.8%. CIMB Group's 1H14 operating income was
1.0% higher at RM6.945 billion. Net interest income was 6.4% higher while
non-interest income declined by 10.0%, due to a combination of lower volatility
in treasury markets, weaker equity markets and decline in Indonesia
bancassurance fees.
The Group's regional Consumer Bank PBT expanded by 1.4%
YoY with Malaysia growing by 7.6% offsetting a 34.8% decline in Indonesia.
Wholesale Banking PBT declined by 11.3% Y-o-Y to RM1.228 billion due to the
slower equity and treasury markets.
The Group's total gross loans expanded 8.5% Y-o-Y or
11.3% after adjusting for foreign exchange fluctuations. Over the same period,
total deposits grew 4.8% Y-o-Y or 7.8% higher Y-o-Y after excluding foreign
exchange fluctuations. This raised the Group's loan to deposit
("LDR") ratio to 89.7% from 86.2% previously.
The Group's gross impairment ratio improved to 3.1% as at
June 2014 from 3.6% in June 2013, with allowance coverage of 104.5% as at June
2014. The Group's cost to income ratio was marginally higher at 57.9% compared
to 57.7% previously.Net Interest Margins ("NIM") were unchanged at
2.88%. As at 30 June 2014, CIMB Group's total capital ratio stood at 14.7%
while its Common Equity Tier 1 (CET 1) capital ratio stood at 9.5%.
Non-Malaysian PBT contribution to the Group was lower at
35% in 1H14 from 39% mainly due to the 20.1% Y-o-Y decline in Indonesia's PBT
to RM741 million from the lower CIMB Niaga earnings and the Rupiah's
depreciation. Thailand's PBT contribution to the Group grew 5.2% YoY at RM125
million as the strong growth at CIMB Thai was offset by much weaker performance
at CIMB Securities (Thailand). Total PBT contribution from Singapore rose 13.2%
to RM160 million as CIMB Bank Singapore PBT grew by 58.2% YoY.
QoQ, The Group's 2Q14 operating income of RM3.407 billion
were 3.7% lower than 1Q14, as the 4.0% QoQ increase in net interest income was
offset by the 20.0% QoQ reduction in non-interest income in light of the lower
fee-based income from CIMB Niaga's Consumer business. 2Q14 net profit was 10.9%
lower QoQ at RM950 million due to higher loan impairment at CIMB Niaga.
With the impending merger deal between CIMB & MBSB
are still pending, we advocate a hold for now.
6) Market: sluggish reporting season combined with
renewed concerns on Ukraine crisis is expected to see index consolidating with
downward bias. Support at 1846pts
