NCB: THIS port operator can stand on its own, thanks to a healthy balance sheet and cash hoard of RM337mil. OSK Securities said NCB Holdings had shown a surprisingly good performance in the first quarter of financial year 2003 despite concerns over the economic slowdown. However, it is still too early to cheer as the impact of the US-Iraq war and SARS would only filter through in the second quarter of 2003. Fundamentally, the research unit said NCB's price-earnings ratio was attractive and based on its healthy net cash, could guarantee a decent dividend payout this year. IJM: PROVING its strong Indian connection, IJM last week received a letter of acceptance from Delhi Metro Rail Corp Ltd for the construction of a RM126mil elevated rail viaduct in India. This is the first tangible contract secured by IJM this year, according to Kim Eng Research, which maintains a “buy” on the construction company. However, the actual amount accruing to IJM, based on its joint-venture proportion of 50%, is only RM63mil. Given a construction period of 20 months, Kim Eng expects the impact on earnings for this year and the next to be minimal. AMFB: MANY believe that AMFB will be privatised by its parent company AMMB Holdings Bhd (AHB), notwithstanding delays to the amendments to the Banking & Financial Institutions Act 1989. Kim Eng Research said the privatisation would probably be effected via issue of new AHB shares, which was imperative if AHB wanted to have a strong investor following. It also cautioned that there was a danger of investors shunning AHB in favour of AMFB as a direct listed proxy to the commercial banking business if AmBank were injected into AMFB. BAT: KIM Eng Research said demand for cigarettes proved to be inelastic and grew by an encouraging 3% to 4.3 billion sticks in the first quarter of the year. BAT maintains its market share of 68%, with mixed performance of its various brands. The research house said the first-quarter results of the company met its expectations with an increase of 13% in pre-tax profit year-on-year. Although dividends were declared in the quarter, it said BAT was likely to sustain its attractive dividend payout, given its cash position and minimal capital expenditure. Historically, BAT has been consistently paying over 90% of its net profits as dividends. Berjaya Group: THE issue for a licence for a “gaming centre” to the group's Colmar Tropicale Resort in Bukit Tinggi, Bentong, may provide speculative interest to Berjaya Group shares in the next few weeks, according to a research house.
It was reported that as much as RM50mil would be spent to develop Malaysia's second largest gaming centre there. The licence allows the company to operate 250 electronic slot machines, making it the second biggest player in the business. Construction of the centre has begun, with operations expected to start by mid-May.