FBMKLCI
1722.44 -7.09pts (-0.41%) Volume 1.761b Value RM1.688b
1) The KLCI closed at its day low inline with the weaker
US market overnight after the earnings season continue to be lacklustre.
Regions however were mostly stronger led by SHCOMP +2.43% which advanced for
the 6th straight session as banking and brokerage stocks outperformed, HSCEI
+0.85%, HSI +0.46%, NIKKEI +0.44%. Local PROPERTY +0.93%index gained the most
grounds boosted by ECOWLD +5.40%, MKH +12.66%, SUNWAY +1.70%, SPSETIA +0.94%.
Market breadth was positive as gainers
beat loser by 491 : 317. Futures closed at 1719 (3.4pts discount).
2) Heavyweights : PCHEM -2.12% RM6.44, GENTING -1.78%
RM8.25, SIME -1.05% RM8.44, CIMB -0.90% RM5.50, IOICORP -1.16% RM4.25, PPB
-1.69% RM15.04, DIGI -0.74% RM5.31, BAT -1.40% RM64.78.
3) DBT: OCK 1.35mil @ RM0.75 (14% discount), BARAKAH 1mil
@ RM0.955, TGOFF 1mil @ RM0.40
4) Situational:-
TALIWRKS +13.96% RM3.51 - Public utilities company
Taliworks Corp Bhd has proposed a share split whereby every two of its existing
ordinary 50.0 sen shares will be subdivided into five 20.0 sen shares.
Taliworks is also proposing to issue up to 241.9m free warrants on a
one-for-five basis after the proposed share split. It said that the higher
volume of shares would enhance the marketability and trading liquidity of its
shares while the lower price per share would make them more affordable and
appealing to a wider group of public shareholders and/or investors.
GLBHD -4.44% RM1.72 - Golden Land Bhd is proposing to
undertake a cash distribution of about RM190.3m. This is following the
completion of its disposal of stakes in four companies and land to Pontian United
Plantations Bhd. On June 8, 2015, Golden Land announced the disposal of equity
interests in Yapidmas Plantation Sdn Bhd, Sri Kehuma Sdn Bhd, Ladang Kluang Sdn
Bhd and Tanah Emas Oil Palm Processing
Sdn Bhd, and a 836.1-hectare oil palm plantation land in Beluran, Sabah, to
Pontian United Plantations for RM655.0m.
5)DESTINI : announced that Destini Armada Sdn Bhd, a
wholly-owned subsidiary had on 23 July 2015, entered into a conditional share
sale agreement with Destination Marine Services Sdn Bhd ("DMS" or the
vendor ) for the proposed acquisition of the entire issued and paid up share
capital of Everyday Success Sdn Bhd, a wholly-owned subsidiary company of DMS,
for an indicative purchase consideration of RM90m to be satisfied via a combination
of cash payment of RM15m and the remaining RM75m to be satisfied via the issuance of
107,142,857 ordinary shares of RM0.10 each at the issue price of RM0.70 per
Destini Share. DMS had, on 15 June 2015, received and accepted a letter of
acceptance from the Agensi Penguatkuasaan Maritim Malaysia ("APMM")
for the supply, delivery, testing and commissioning of six (6) patrol vessels
to APMM for a contract period of thirty five months at a contract value of
RM381.3m. DMS, APMM and Everyday Success shall execute a novation agreement for
the purpose of effecting the novation to Everyday Success of all the rights and
liabilities of DMS under the contract awarded by APMM to DMS in relation to the
Project. Pursuant to the SSA, the Vendor agrees, undertakes and guarantees that
the aggregate PAT of Everyday Success for the 2 FY ending 31 December 2015 and
31 December 2016 ("Profit Guarantee Period") shall not be less than
RM25m; +ve. Destini is currently involved in the marine safety and survival
business activities via its subsidiary company, Vanguard Composite Engineering
Pte Ltd which manufactures life boats and davits systems and the Techno Fibre
group, which provides maintenance, repair and overhaul ("MRO")
services on life boats, davits systems and other lifesaving equipment.
Vanguard's factory in Nantong, China has a capacity to build about 150 boats
per year. Due to the increase in demand, Vanguard plans to set up another
facility in Malaysia. DMS has existing facilities to accommodate this
requirement. DMS is a manufacturer of paramilitary boats of various types and
sizes of vessels. It also specialises in building small-medium size vessels,
including but not limited to ferries, barges, tugs, offshore support vessels,
yachts, fishing vessels and patrol crafts with vessels sizes of up to 45 metres
in length. The Proposed Acquisition represents a gateway for Destini to further
increase its range of products and expand its supply of vessel segment in terms
of product complexity, technology, technical knowledge and expertise by
venturing into the supply, testing and commissioning of paramilitary boats and
its related MRO services. The Proposed Acquisition is expected to be earnings
accretive based on the Profit Guarantee and contribute positively to the future
earnings of the enlarged Destini Group.
6) Market : Near-term technical reads on the KLCI remain
neutral, suggesting the local bourse could be due for a consolidation phase. We
maintain our view that the index could continue its sideways trading between
1690 - 1745 points for the week.
