Malaysia must focus on growth not austerity, says AirAsia boss - Business News

KUALA LUMPUR: Malaysia's economy is currently in a good position so the government should focus on growth and not austerity, said AirAsia Group Chief Executive Officer Tan Sri Tony Fernandes.He said the government must focus on increasing its efficiency and productivity in order to grow jobs and be a driving force in ASEAN.“Focus on those industries that can bring income quick, and technology and ideas that can bring big growth (for the country),” he added in his latest post on Twitter.Fernandes said having economic growth would enable the government to handle its debt.He also believes the ringgit will strengthen to about 3.80 against the US dollar soon.Bank Negara Malaysia had announced that the Federal government debt totalled RM686.8 billion as at end-2017, equivalent to 50.8 per cent of the gross domestic product.Subsequently, Finance Minister Lim Guan Eng said the Federal government debt and liabilities amounted to RM1.08 trillion as at Dec 31, 2017.This included the RM686.8 billion in Federal government debt and RM199.1 billion of government guarantees to pay on behalf of entities, which were unable to service their debt, he said.He said the government was also committed to RM201.4 billion in lease payments for rental, maintenance and other charges for public-private partnership projects such as the construction of schools, hostels, roads, police stations and hospitals.Earlier in the Dewan Rakyat, Prime Minister Tun Dr Mahathir Mohamad said the government was considering securing a loan facility from Japan to reduce the 'high cost of money' as the interest rate on debt taken by the previous administration was too high at six per cent.He said the value of the Japanese yen was cheaper than the ringgit with one yen equalling 1 US cent, while RM1 was worth 25 US cents, and repaying Malaysia's debt in the Japanese yen meant the country would not be burdened with a high interest rate of more than six per cent.

Source:The Star

July 23, 2018 09:11 UTC

Sime Darby upbeat on MVV project - Business News

SHAH ALAM: Developer Sime Darby Property Bhd is optimistic about the prospects of its Malaysian Vision Valley (MVV) development despite the fact that the Kuala Lumpur High-Speed Rail (HSR) project has been scrapped.Sime Darby Property township COO Datuk Wan Hashimi Albakri said the developer has engaged the new government about MVV, who are also optimistic.“The project will be a game-changer and is set to be a boost to Negeri Sembilan and the Malaysian economy,” he said earlier today following a signing ceremony with the United Nations Children’s Fund (UNICEF).The HSR has been scrapped by the new Pakatan Harapan government as it was deemed to not be financially viable.Under the proposed project, the Seremban and Muar HSR stations were supposed to be located within the MVV.Hashimi said Sime Darby is in talks with developers to participate in MVV.The development will span 379,000 acres, and is focused on a variety of industries, including healthcare, education and tourism. It is located in Negri Sembilan, bordering Selangor.Meanwhile, Sime Darby Property has signed a memorandum of understanding (MoU) with UNICEF to build Malaysia’s first inclusive playground at the developer’s City of Elmina project.Sime Darby Property has set aside an initial budget of RM1mil to build the inclusive playground.Scheduled for completion in the first half of 2018, the inclusive playground in City of Elmina will enable children with and without disabilities to play together as equals, creating opportunities for inter-generational interaction within families and social cohesion of the wider community.Sime Darby Property is Malaysia’s largest property developer in terms of landbank with 20,743 acres of remaining developable land as at Dec 31, 2017.

Source:The Star

July 23, 2018 08:03 UTC

Cautious start to the week as Public Bank, Petronas Gas dip - Business News

KUALA LUMPUR: Public Bank and Petronas Gas dipped early Monday, dragging the FBM KLCI into the red as Bursa Malaysia tracked the cautious key Asian markets.At 9.27am, the KLCI was down 3.87 points or 0.22% to 1,750.80. Turnover was 446.91 million shares valued at RM210.36mil. There were 176 gainers, 224 losers and 260 counters unchanged.The US dollar fell against major currencies to its lowest in more than two weeks after U.S. President Donald Trump criticised the Federal Reserve's tightening policy, while stocks slipped on fears of further trade protectionist measures, Reuters reported.Meanwhile, Japan's Nikkei stumbled 0.9%. MSCI's broadest index of Asia-Pacific shares outside Japan was up a touch.As for Bursa, Kenanga Research said technically, the index outlook is positive-bias as evidenced by positive stance on MACD and RSI indicators.“From here, we expect a short breather before continuation towards next resistance at 1,790 (R1) and 1830 (R2) further up. Meanwhile, support levels can be identified at 1,720 (S1) and 1,700 (S2),” it said.At Bursa, among the KLCI stocks, Public Bank fell 10 sen to RM23.84, Petronas Gas eight sen to RM18.28 and IOI Corp lost five sen to RM4.47.UMW shed 10 sen to RN6.09, Freight eight sen to RM1.03 and Hengyuan seven sen lower at RM6.55.MY EG Services rose five sen to RM1.29 and it was the most active with 38.6 million shares.CIMB Equities Research said the company has been working on a Sales and Service Tax (SST) system which the new government could use to reduce leakages when the SST is launched in September and also a new module for foreign workers.F&N was the top gainer, up 64 sen to RM37.96, BAT added 58 sen to RM34.28, Heineken 56 sen to RM23.40 and Nestle 40 sen higher at RM148.40.Latitude Tree extended its gains, up 26 sen to RM3.90 as analysts expected it to benefit from the US-China trade war.

Source:The Star

July 23, 2018 01:41 UTC

AmInvest Research cuts Ann Joo net profit outlook, retains hold - Business News

KUALA LUMPUR: AmInvestment Bank Research has cut its FY18-20F net profit forecasts by 11%, 13% and 31% respectively and reduce its fair value (FV) by 20% to RM2.17 from RM2.70, but maintain its hold call.It said on Monday its new FV was based on eight times revised FY20F fully diluted earnings per share (EPS) of 27.1 sen.“We use FY20F (instead of FY19F) as our valuation base year to reflect the potential earnings downturn in FY20F with the completion of major mega infrastructure projects in about two years from now,” it said.AmInvest Research said the downgrade in its FY18F earnings forecast was to reflect an expected soft 2QFY18 (April–June) as contractors held back from steel purchases on the heels of the surprise 14th general election outcome that threw various public infrastructure projects into limbo.It also lowered its outlook for sales volumes and prices in FY19-20F. It now assumes FY18-20F sales volume growth of 0% to 2.5% per annum (from 3% previously) and average steel selling prices of RM2,465-2,565/tonne (from RM2,500-2,700/tonne previously).“The key takeaway from our recent visit to the company is that Ann Joo ’s earnings will not fall off the cliff. This is because key public infrastructure projects that are spared the axe will still require a substantial amount of steel input.“More so when mega projects like the MRT2 and LRT3 are still in relatively early stages of implementation with completion of only 20%-30% and 10% respectively. These will still consume a fair bit of steel over the next 24 months at the least,” it said.AmInvest Research said also, Ann Joo sees opportunities in the export markets such as Thailand and Indonesia.It said despite the intense competition (against Russian, Chinese and Iranian players, etc), exporters like Ann Joo often times can lock in good prices for certain products (for instance, billet at US$550/tonne at present) due to short-term mismatches of demand and supply.Export sales made up 15% of Ann Joo’s total sales volume in FY17.“The fortunes of Ann Joo, a long steel player, are inevitably tied to the construction sector, of which prospects have weakened following the cutbacks on public infrastructure project on grounds of fiscal prudence.“However, Ann Joo will sustain its earnings, underpinned by ongoing construction projects and export sales. It is less vulnerable to a higher electricity tariff thanks to its investment in the hybrid blast furnace electric arc furnace (BF-EAF) technology,” it said.

Source:The Star

July 23, 2018 00:56 UTC

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