Shares of NFOs recover in early trade

KUALA LUMPUR: Shares of number forecasting operators (NFOs) recovered this morning after being hit by Putrajaya’s announcement that the number of special draws will be reduced to eight per year on Monday.

As of 10.10 am, Sports Toto Bhd rose three sen to RM1.63 with 588,600 shares traded while its peer Magnum Bhd gained one sen to RM1.30 with 2.29 million units changing hands.

At the close of yesterday’s trading session, Magnum shares dipped seven sen to a one-year low of of RM1.29, with 6.2 million shares changing hand while Sports Toto also fell seven sen to a one-year low of RM1.60 with 2.95 million shares traded.

After a special Cabinet meeting on Monday, Prime Minister Datuk Seri Anwar Ibrahim told the press that the number of special draws by NFOs will be reverted to just eight per year, from the present 22, as part of the government’s move to carry out its duties transparently.

Previously under the Pakatan Harapan administration, the NFOs were only allowed eight special draws but this was raised to 22 in 2021.

In a research note today, Public Investment Bank said in terms of earnings impact on Sports Toto, it was expected to be minimal as this special draw reduction only lowered the investment bank's assumption of total draws by about 3.0 per cent to 164 draws.

"Although this could still affect sentiment on NFO stocks, we maintain our ‘outperform’ call on Sports Toto given an improving earnings outlook and attractive dividend yield,” it added. - Bernama

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