News Bits | 8 Oct 2012

Highlights of the day

§  Economics (External Trade): August 2012: Weak European demand pulls Malaysian exports down [download report]

August exports for Malaysia declined steeply by 4.5% y-o-y as European demand continued to soften and possibly also due to Hari Raya holidays. Imports grew relatively weak at 2.8% y-o-y compared to 9.5% growth in July. While the weak import growth somewhat mirrored the export contraction, it suggests that domestic demand might have taken a hit. Total trade decreased by 1.3% y-o-y but net exports grew to RM7.1bn from a decade-low of RM3.6bn in July. Nevertheless, August 2012 net export was still significantly lower than year ago. We project September exports to drop further by 1.3% y-o-y and imports to grow by 3.9% with net exports of RM7.0bn.

 

§  MISC (Quick Bits): Divestment of Gemusut-Kakap Semi FPS (Maintain HOLD, TP: RM5.01) [download report]

To further strengthen its financial stability following its recent exit from the liner business, MISC has proposed to monetize its prized asset netting a whopping cash proceeds of USD1,732m (RM5,295m). MISC has completed the disposal of the Gumusut-Kakap Semi-FPS for USD2,038m (RM6,229m) via receiving USD1,426m (RM4,360m) cash and the remaining balance in shares of GKL. Thereafter, MISC has proposed to divest a 50% stake Gumusut-Kakap Semi-Floating Production System (L) Limited to E&P Venture Solutions Co Sdn Bhd for USD305.7m (RM934m) cash. This exercise would free-up MISC’s cashflow in the currently difficult shipping industry but MISC will have to forego 50% of its earnings from this divestment. Maintain Hold with a target price of RM5.01 based on 1.0x FY13 P/BV.

Other reports

§  Newz Bits [download report]

 

Other Malaysian news

§  Maybank: May be able to raise RM2.64bn via shares placement

§  Sunway: On track for RM1.3bn sales

§  SapuraKencana: Buys 38% of Quippo Prakash

§  KPJ: To grow its foreign patients segment

§  DiGi: Telenor bets on DiGi

§  AirAsia: Keeps options open on KLIA2 switch

§  Southern Steel: JV with Bekaert to strengthen presence in Asean

§  Tambun Indah: To launch RM1bn worth of properties

§  Alliance: Investment bank is not for sale

§  Plantation: CPO tax cut decision likely by year-end

§  Telecommunications: Myanmar telecom race

§  Timber: Challenging year for sector

 

Global news

§  US: Jobless rate declines to 7.8%; 114,000 jobs added

§  US: Deficit ends fourth fiscal year above US$1trn

§  US: Consumer credit bounces back in August

§  Japan: BoJ holds off on expanding asset-buying programme

§  South Korea: Government won't weaken Won to spur exports

 

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