Stocks To Watch - Sime Darby, JP Morgan’s top picks, Ayer Molek, Sunway, Berjaya Land and YGL

KUALA LUMPUR (March 26): Based on corporate announcements and a JP Morgan research report, the stocks that could stir some investor interest may include Sime Darby, JP Morgan’s top picks, Ayer Molek, Sunway, Berjaya Land and YGL.

SIME DARBY BHD [] is set to expand its healthcare division in Asia by forming a 50:50 joint venture (JV) with Australia’s Ramsay Health Care Ltd.

Sime Darby said it will inject its healthcare and education business into Sime Darby Global Healthcare Sdn Bhd, and Ramsay’s subsidiary AH Holdings Health Care Pty Ltd will also inject its Indonesian healthcare business into the same company.

“Sime Darby Global Healthcare will subsequently be renamed as Ramsay Sime Darby Health Care Sdn Bhd,” said Sime Darby in an announcement.

Sime Darby said the JV will enable Sime Darby to monetise its 50% investment in SD Healthcare, by recognising an estimated net gain on disposal of RM340 million.

The group said the JV is part of its strategy to accelerate the growth plans of its healthcare business to capture the rapidly growing opportunities in Asia.

JP Morgan, which has upgraded Malaysia equities to “overweight”, is telling investors that “now” is the time to buy nine Malaysian stocks it sees as benefiting from to the country’s growth, Economic Transformation Programme and bustling developments in Iskandar Malaysia.

Don’t wait until the general election is over, the US investment bank said in a recent report which appeared in the local media today.

JP Morgan’s nine stock picks are AMMB HOLDINGS BHD [], Axiata Group Bhd, BERJAYA SPORTS TOTO BHD [], CIMB Group Bhd, DIALOG GROUP BHD [], GAMUDA BHD [], IJM Land Bhd, KLCC PROPERTY HOLDINGS BHD [] and MEDIA PRIMA BHD [].

Seven of the nine stocks rose today, with some already roaring yesterday. These stocks may continue to rise or may succumb to profit-taking on Wednesday.

The Ayer Molek Rubber Company Bhd (AMOLEK) said Bursa Malaysia Securities has dismissed its appeal by against de-listing.

The company said Bursa has also rejected its request for an extension of time until the Federal Court’s decision in respect of AMOLEK’s claim for the return of the 711 acres piece of land in Segamat to submit its regularisation plan.

The stock exchange has ordered AMOLEK to convene a general meeting to seek shareholders’ decision on the utilisation of the company’s cash and short term investments, within three (3) months. Following this, the company’s securities shall be de-listed after two market days.

Sunway Bhd said an indirect unit, Sunway Velocity Mall Sdn Bhd, has received approval from the Securities Commission to establish a medium term note (MTN) programme for the issuance of unrated MTN of up to RM1.0 billion in value.

Sunway Bhd’s wholly-owned subsidiary Sunway City Sdn Bhd holds a 59% stake in Sunway Velocity Mall.

According to the Sunway announcement, each MTN shall have a maturity of one to 15 years, and the proceeds from the issuance of the MTNs would be utilised to finance the development of Sunway Velocity Shopping Mall and its future operating and investment activities.

BERJAYA LAND BHD [] (BLB) posted a net loss of RM17.3 million for its third quarter ended Jan 31, 2013, a sharp reversal from a net profit of RM 2.5 million achieved a year ago.

The quarter posted a loss of 35 sen per share.

Meanwhile, BLB’s revenue stood at RM1 billion for its third quarter ended Jan 31, 2013, a decline of 9.1% from RM1.1 billion in third quarter 2012.

In a filling to Bursa, BLB said that the fall in revenue was mainly due to the lower revenue netted by the gaming business operated by its unit Berjaya Sports Toto Bhd (Btoto).

Going forward, the company expects Btoto to continue consolidating the earnings from gaming and from the proposed restructuring exercise of Btoto that involves the transfer of its gaming unit to a business trust expected to be listed on the Singapore Stock Exchange.

But it said the group’s performance will face challenges in the remaining quarter of the current financial year.

Btoto’s net profit fell 23.7% to RM86.1 million for the third quarter from a year ago on lower revenue due to a higher prize pay-out during the period.

YGL CONVERGENCE BHD [] said its unit, Ygl Convergence Malaysia Sdn Bhd, has bagged a RM6.1 million project for the development and implementation of the SAP Human Resource system for MALAYAN BANKING BHD [].

The project covers Maybank’s branches and subsidiaries in Singapore, Thailand, Vietnam, Indonesia and Philippines, and will run from March 2013 to March 2014.

The project is expected to contribute positively to the earnings and net assets of Ygl Group for the financial years 2013 and 2014, the company said.