Stockwatch

CAHB: THE financial group missed the deadline end of last month to release its annual financial results but was able to deliver a good set of earnings figures. Commerce Asset-Holding pre-tax profit rose 45% to RM747.6mil while net profit surged 63% to RM558.5mil for the financial year ended Dec 31 last year. Lower loan loss provisions lifted last year’s earnings, despite higher-than-expected overheads in the fourth quarter. However, analysts expect overheads to fall because most expenses incurred were non-recurring. The group’s share buyback scheme will continue to support its share price. It has bought back 30.352 million shares to date. 

IOI Corp: IOI Corp share price dropped like a rock to a 13-month low of RM4.70 last Friday. Selling was initially triggered by rising concerns over the impending downcycle in crude palm oil prices. The drop in share price intensified after the group proposed to buy 21,722ha of plantation land in Sabah from major shareholder Tan Sri Lee Shin Cheng and his family at about RM32,000 per ha. The price is higher than its unit Palmco Holdings Bhd paid for Unilever plc’s plantations in De- cember last year. The acquisition should enhance earnings but investors are unhappy with the price tag and timing of the proposed related-party transaction. 

Celcom: A LARGE majority of Celcom shareholders voted in favour of the proposed merger with Telekom Cellular Sdn Bhd last Thursday. Celcom share price climbed to a 10-month high of RM2.68, but that of Telekom Malaysia dipped further. Have all the obstacles been removed? The merger is now awaiting approval of Telekom shareholders who are voting next Monday. Deutsche Telekom, an 8% Celcom shareholder, voted against the merger at the EGM. It claimed veto rights over the merger under a deal with Celcom’s previous management. The German telco has vowed to fight on and pursued arbitration in Paris.  

UDA Goldings: SHAREHOLDERS are unlikely to resist the proposed sale of the 41% stake in West Country Sdn Bhd to Magnum Corp Bhd at today’s EGM because the deal will boost UDA Holdings’ cash pile to about RM280mil. At the EGM, shareholders may, however, raise questions on the emergence of new major shareholder Malaysian Resources Corp Bhd (MRCB) in the property group. MRCB intends to acquire Landas Utama Sdn Bhd (LUSB), which owns nearly a 25% stake in UDA, via cash payment of RM88mil and taking over LUSB’s RM132mil debt. Minorities may ponder if debt-laden MRCB can enhance the prospects of cash-rich UDA. 

Proton: THE MALAYSIAN Automotive As- sociation (MAA) said February vehicle sales were dragged down by lower sales of national cars. Proton car sales in February slid nearly 26% to 11,236 units from 15,146 a year ago. Month-on-month, the fall was sharper at 38% from 18,023 units a month ago. The weaker sales numbers reinforce analysts’ expectations of lower earnings in the fourth financial quarter ending March 31. Growing competition from affordably priced non-national cars and a possible delay in the launching of new models have sparked concern over the earnings prospects of the national carmaker. 

IOI Corp: IOI Corp share price dropped like a rock to a 13-month low of RM4.70 last Friday. Selling was initially triggered by rising concerns over the impending downcycle in crude palm oil prices. The drop in share price intensified after the group proposed to buy 21,722ha of plantation land in Sabah from major shareholder Tan Sri Lee Shin Cheng and his family at about RM32,000 per ha. The price is higher than its unit Palmco Holdings Bhd paid for Unilever plc’s plantations in De- cember last year. The acquisition should enhance earnings but investors are unhappy with the price tag and timing of the proposed related-party transaction. 

Celcom: A LARGE majority of Celcom shareholders voted in favour of the proposed merger with Telekom Cellular Sdn Bhd last Thursday. Celcom share price climbed to a 10-month high of RM2.68, but that of Telekom Malaysia dipped further. Have all the obstacles been removed? The merger is now awaiting approval of Telekom shareholders who are voting next Monday. Deutsche Telekom, an 8% Celcom shareholder, voted against the merger at the EGM. It claimed veto rights over the merger under a deal with Celcom’s previous management. The German telco has vowed to fight on and pursued arbitration in Paris.  

UDA Goldings: SHAREHOLDERS are unlikely to resist the proposed sale of the 41% stake in West Country Sdn Bhd to Magnum Corp Bhd at today’s EGM because the deal will boost UDA Holdings’ cash pile to about RM280mil. At the EGM, shareholders may, however, raise questions on the emergence of new major shareholder Malaysian Resources Corp Bhd (MRCB) in the property group. MRCB intends to acquire Landas Utama Sdn Bhd (LUSB), which owns nearly a 25% stake in UDA, via cash payment of RM88mil and taking over LUSB’s RM132mil debt. Minorities may ponder if debt-laden MRCB can enhance the prospects of cash-rich UDA. 

Proton: THE MALAYSIAN Automotive As- sociation (MAA) said February vehicle sales were dragged down by lower sales of national cars. Proton car sales in February slid nearly 26% to 11,236 units from 15,146 a year ago. Month-on-month, the fall was sharper at 38% from 18,023 units a month ago. The weaker sales numbers reinforce analysts’ expectations of lower earnings in the fourth financial quarter ending March 31. Growing competition from affordably priced non-national cars and a possible delay in the launching of new models have sparked concern over the earnings prospects of the national carmaker.