MNI Holdings expects to turnaround


Stockwatch by Yvonne Chong

THE most “complete” insurance company with licenses to operate life and general insurance as well as takaful is on a restructuring exercise that is expected to turn it around from a loss of RM38.1mil last year. Its general premium jumped by 42.9% to RM146.9mil for the first quarter ended June 30, and growth in its life business is expected to accelerate from the second quarter. The surplus from its takaful business, meanwhile, is on the rise. The proposed disposal of non-profitable non-core businesses will also save MNI about RM15mil to RM19mil losses yearly. 

MALAKOFF  

 

THE independent power producer expects to complete the acquisition of a 90% stake in SKS Power and 100% in Prai Power by the end of the month. The purchase of a 40% stake in Kapar Power Plant for RM4.2bil, meanwhile, is slated for completion by year-end. The acquisitions would eventually boost the group’s electricity generating capacity to some 4,700MW from the current 1,500MW. With the buys, Malakoff has forecast a 21% market share of the power generation sector in peninsular Malaysia by 2007. It is also eyeing to acquire the remaining 25% interest it does not already own in Segari Energy from Tenaga. 

SOUTHERN ACIDS  

TRADING on this low-profile oleochemicals manufacturer shot through the roof following an announcement last Wednesday of a special dividend of 35 sen per share, the largest in the company's history, which the company hoped would entice holders of its 32 million warrants to convert them into shares. Some 1.28 million shares were traded last Thursday, compared with the norm of less than 100,000 this year, and share price likewise increased significantly. 

Although still primarily in the oleochemical business, Southern Acids also recently increased its exposure upstream by acquiring more palm oil plantations in Indonesia last month. 

PPB OIL PALM 

SENTIMENT on the palm oil sector has been rather bullish, with the price of crude palm oil (CPO) rising steadily and expected to remain between RM1,600 and RM1,700 a tonne until the first quarter of next year. Shares of this Sarawak-based plantation group, which is involved in upstream and downstream plantation activities, have been trading at an undemanding PE of 9.6x versus the industry average of 12x. Analysts expect it to play catch up in the coming months. 

MTD 

MTD Capital is expected to clinch a few sizeable projects in the next few months, and its improved balance sheet better positions it to bid for future privatised projects. It remains the frontrunner for the East Coast Expressway phase 2 project worth RM1.3bil, given its strong cost advantage as the main contractor in phase 1; and the proposed Pandan Corridor toll may be revived. Subsidiary MTD InfraPerdana is set to sign a supplementary concession agreement for KL-Karak Highway by year-end, easing associated uncertainties.  

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