How the budget affects listed firms

HI-TECH HEALTHCARE - Malaysia healthcare was rated Number One by the International Living’s Annual Global Retirement Index 2015 based on its excellent yet affordable quality, as seen here at KPJ Damansara Operating Theatre. - - Pic by Malaysia Healthcare Travel Council

Budget 2020 spelt out incentives cutting across various sectors of the economy, from health to infrastructure, and from digital payment systems to real estate.

Below we list some of the project and the listed companies which could potentially be involved.

> KLANG LOGISTICS CORRIDOR Government to spend RM8.3bil for the Serendah-Port Klang Rail Bypass as well as a dedicated privatised highway for commercial vehicles connecting Northport and Westport. Beneficiaries are likely to be Westports Holdings Bhd, MMC Corp Bhd, Gamuda Bhd, Sunway Construction Bhd, Muhibbah Engineering (M) Bhd and Gabungan AQRS Bhd.

> DEVELOPMENT OF PULAU CAREY Sime Darby Bhd is the biggest land owner there. Previously there were reports of a major port to be built there.

> NATIONAL FIBERISATION AND CONNECTIVITY PLAN (NFCP) Government to spend RM21.6bil to improve coverage of high speed digital connectivity nationwide. MCMC to finance at least half of the required investment with corresponding investments by the private sector telecommunications players via matching grant mechanism. Expected beneficiaries are telecommunication players such as Telekom Malaysia Bhd, Maxis Bhd, Bhd and Axiata Group Bhd.>

ADOPTION OF DIGITALISATION MEASURES FOR SMES Government will provide a 50% matching grant amounting to RM500mil over five years to boost digital payment systems. Potential beneficiaries are payment system providers GHL Systems Bhd, Revenue Group Bhd, and Managepay Systems Bhd.

> THE E-WALLET INITIATIVE There are some 45 companies providing e-wallet services. But the bigger non-bank players such as Green Packet Bhd and Axiata Group Bhd are expected to move aggressively to capitalise on the digital stimulus incentive. In relation to this, the government is offering RM30 for those above 18 and earning less than RM100,000 annually to spur the usage of e-wallets. Khazanah Nasional to implement this digital stimulus.

> HEALTHCARE TOURISM Government to allocate RM25mil to strengthen Malaysia’s position as the preferred destination for health tourism in Asean for oncology, cardiology and fertility treatment.

The likely beneficiaries are private hospital operators: KPJ Healthcare Bhd, IHH Healthcare Bhd, TMC Life Sciences Bhd, and Sunway Bhd.

> UPGRADING OF MEDICAL EQUIPMENT The government to spend RM227mil on this.

There is also an initiative to encourage local medical equipment producers to supply to public clinics and hospitals.

Among the existing suppliers and manufacturers are BCM Alliance Bhd, Supercomnet Technologies Bhd, Dufu Technology Corp Bhd and UWC Bhd.

> IN-VITRO FERTILISATION (IVF) PROCEDURE The Employees Provident Fund (EPF) will introduce a new category of withdrawals, allowing for fertility treatments like IVF procedure. The leading healthcare provider in this area is TMC Life Sciences Bhd.

> CABINET APPROVED THE TAKEOVER OF FOUR HIGHWAYS IN KLANG VALLEY The shareholders of the highways are Gamuda Bhd, Litrak Bhd and KPS Bhd.


> STIFFER PENALTIES FOR ILLEGAL GAMBLING Illegal operators to be fined RM1mil and mandatory jail for 12 months while gamblers will be fined RM100,000 and face custodial sentence of six months.

Also, the government is reducing the number of special draws by the number forecast operators (NFO). Still, the stiffer penalties should mitigate this for Magnum Bhd and Berjaya Sports Toto Bhd which are bound to draw more betters.

> BANDAR MALAYSIA PROJECT The government is to proceed with the development of the mammoth property development project. It ends uncertainties on the project that was awarded to a joint venture of Iskandar Waterfront Holdings (IWH) and China Railway Engineering Corp. IWH is controlled by Tan Sri Lim Kang Hoo, who is a major shareholder of Iskandar Waterfront City Bhd and Ekovest Bhd.

> CENTRALISED PROCUREMENT OF MEDICINE FOR MINISTRY OF HEALTH, MINISTRY OF DEFENCE AND UNIVERSITY HOSPITALS The centralised tender system is expected to see keen competition among players. Among the companies in pharmaceutical products are Pharmaniaga Bhd, CCM Duopharma Biotech Bhd, Hovid Bhd, Y.S.P Southeast Asia Bhd and Kotra Industries Bhd.

> RM4.85BIL FOR MAINTENANCE OF STATE ROADSLeading road care maintenance companies are Protasco Bhd and UEM Edgenta Bhd.

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