Stocks to watch: Dialog, Gamuda, GentingM, Glomac, Sunwayst

Stocks on Bursa Malaysia may extend gains on Wednesday, Sept 22 after the government unveiled an ambitious multi-pronged plan to drive the economy while it had also identified investments worth US$444 billion over 10 years.

The strategy included a new mass transit system (MRT) to relieve congestion in Kuala Lumpur, to building a huge oil storage facility next to Singapore to form a regional oil products trading hub.

The government had identified investments worth US$444 billion over 10 years, of which 60% would come from the private sector, 32% from government-linked companies and 8% from government.

Stocks to watch include DIALOG GROUP BHD [], with its expertise in building terminals for oil storage, while GAMUDA BHD [] and IJM Corp Bhd could be in focus with their expertise in infrastructure projects.

The MRT will create spin-off projects for other players in the building material industries like Kimlun which makes claddings for tunnels for Singapore’s MRT.

On Wall Street, U.S. stocks ended flat to lower in an erratic session on Tuesday, Sept 21 after the Federal Reserve inched closer to further steps to spur the economy.

Stocks initially popped higher but gave back those gains quickly. Investors had hoped that with recent improvements in economic data, the Fed would issue a more upbeat outlook or clarify the measures it would take to stimulate demand.

The central bank nudged the door wider to pumping more money into the economy but kept overnight interest rates unchanged near zero, as expected.

The Dow Jones industrial average was up 7.41 points, or 0.07 percent, at 10,761.03. The Standard & Poor's 500 Index was down 2.93 points, or 0.26 percent, at 1,139.78. The Nasdaq Composite Index was down 6.48 points, or 0.28 percent, at 2,349.35.

At Bursa Malaysia, property stocks could come under focus after the government said lower loan to value ratio for property purchases was only applicable to speculative real estate deals.

Genting Malaysia Bhd’s acquisition of the casino business in the United Kingdom from Genting Singapore plc will be reduced to £351.5 million from £340.0 million.

Genting Malaysia said on Tuesday, Sept 21 the lower acquisition cost was due to the lower net debt position at £74.4 million as at June 20 compared with the net debt amount of £85.9 million as at May 31.

The purchase consideration will be revised by the net debt difference from £340.0 million to £351.5 million to reflect the reduction in net debt.

CIMB Group Holdings Bhd is seeking for an extension of six months up to April 6, 2011 for it to complete the proposed dual listing in Thailand.

CIMB submitted an application for the extension to the Securities Commission “and is currently pending the decision of the SC”.

GLOMAC BHD [] posted a strong set of results, with net profit up 88% to RM15.55 million in the first quarter ended July 31, 2010 versus RM8.34 million a year ago and the property developer expects its unbilled sales of RM585 million to sustain its earnings growth.

Revenue surged 114% to RM126.31 million from RM58.98 million while pre-tax profit rose 79% to RM29.5 million in the quarter. Earnings per share were 5.32 sen versus 2.99 sen.

Glomac said the RM15.55 million net profit was close to 40% of the full year profit after tax of RM40.9 million achieved in the group’s financial year ended April 30, 2010. Its net asset per share was RM1.94

InsiderAsia reports Green Packet (98 sen) is preparing for a fresh wave of sales and marketing activities, redoubling its efforts to gain new subscribers. P1, the company's WiMAX business unit, targets to grow its subscriber base to 280,000 by the end of the year from 196,000 at end-June 2010.

Handal Resoources Bhd has proposed a renounceable rights issue of 60 million new shares of 50 sen each.

It also planned to offer 60 million new free detachable warrants on the basis of two rights shares and two free warrants for every three existing Handal shares held.

It also proposed a bonus issue of 20 million shares on the basis of one bonus share for every three rights shares fully subscribed.

SUNWAY HOLDINGS BHD [] proposes to issue commercial papers and/or medium term notes of up to RM500 million in nominal value pursuant to a CP/MTN Programme.

HELP International said it is currently in preliminary discussion to tie up with a Singapore education provider to offer joint programmes in the Singapore market.

“As part of this collaboration, there is a right of option to invest into the Singapore entity. However, the company has yet to reach a concrete conclusion in relation to the abovementioned preliminary discussion,” it said.

HELP also said as part of the company's initiatives to embark on its internationalisation plan, HELP has been considering various fund raising options as to progressively raise capital for its business expansion.


by Joseph Chin
The Edge Malaysia