Mudajaya, Parkson, AmBank, E&O, CAB Cakaran, Jiankun, Talam Transform, Halex, Masterskill, SMRT, SYF, NTPM, KFM and Icon Offshore

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KUALA LUMPUR (March 20): Based on corporate announcements and news flow today, companies that may be in focus next Monday (March 23) could be: Mudajaya Group Bhd, Parkson Holdings Bhd, AMMB Holdings Bhd, Eastern & Oriental Bhd (E&O), CAB Cakaran Corp Bhd, Jiankun International Bhd, Talam Transform Bhd, Halex Holdings Bhd, Masterskill Education Group Bhd, SMRT Holdings Bhd, SYF Resources Bhd, NTPM Holdings Bhd, Kuantan Flour Mills Bhd (KFM) and Icon Offshore Bhd.

Builder cum property developer Mudajaya Group Bhd (Mudajaya) announced today that it has uncovered irregular transactions in its books involving a former employee, which led to enlarged costs incurred on a specific project.

These irregular transactions were uncovered by the group’s internal management working group, it said in a press release today.

Information from the review suggested the issue was confined to an isolated case involving one former employee and that it is restricted to only one of the company’s projects, the statement read.

Mudajaya (fundamental: 1.15; valuation: 1.8)’s chairman Datuk Yusli Mohamed Yusoff stressed all costs relating to the particular project and to the financial results of the group have been fully accounted for, in the company’s books.

Departmental store operator Parkson Holdings Bhd has issued a statement to calm investors, after the company’s shares came under selling pressure over the last few days.

Through a statement today, the group said it is not aware of any circumstances within it that could have led to the sell-down of its shares.

Its counter plunged 19.4% or 48 sen from RM2.47 on March 13, 2015 (last Friday) to close at RM1.99 today, down 6 sen or 2.93% from yesterday’s close.

The counter is now at its lowest in five years. The current price gives it a market capitalisation of RM2.016 billion, which means it saw RM486.27 million in market value wiped out in just seven days.

Parkson (fundamental: 1.8, valuation 2.4) was also Bursa Malaysia’s 10th most actively-traded stock today, after some 42.2 million shares having changed hands.

The group reiterated it remains confident in its business fundamentals and prospects.

AMMB Holdings Bhd (AmBank) appointed Datuk Mohamed Azmi Mahmood as the acting group managing director, effective April 2, 2015.

According to AmBank’s press statement, Azmi will take over from Ashok Ramamurthy, whose contract as group managing director will end on April 1, 2015, while the banking group continues its search for a permanent replacement.

Azmi is a chartered accountant and has been a part of the banking group since 1981.

Property developer Eastern & Oriental Bhd (E&O) is partnering Japan’s Mitsui Fudosan Co Ltd (Mitsui) to jointly develop a 298-unit serviced apartment project on a piece of freehold land in Kuala Lumpur.

According to E&O's filing with Bursa Malaysia this evening, E&O’s indirect wholly-owned subsidiary Samudra Pelangi Sdn Bhd and Mitsui’s indirect wholly-owned subsidiary Mitsui Fudosan Asia Pte Ltd (MFA) entered into a shareholders' agreement to develop the 5,812 sq m land, through Patsawan Properties Sdn Bhd (Patsawan).

The land, located at the intersection of Jalan Kia Peng and Jalan Conlay where a double-storey mansion is now seated, is held by Patsawan, which is a wholly-owned subsidiary of Samudra.

Patsawan has already obtained the development order for the project, from local authorities.

Poultry firm CAB Cakaran Corp Bhd intends to diversify into electricity generation, after it signed a memorandum of understanding (MOU) with Japan-based New Chemical Trading Co Ltd and Seri Kedah Corp Sdn Bhd to establish a biomass power-generation business.

The venture will produce fertiliser as a by-product through the incineration of chicken droppings. It is also CAB Cakaran (fundamental: 0.55; valuation: 1.2)’s first step into downstream poultry farming business.

The MoU lasts for 12 months, which involves forming two joint venture companies among the three parties, CAB Cakaran told Bursa.

Property developer Jiankun International Bhd (Jiankun) is diversifying into the construction business, after receiving a proposed award to construct 28 units of factories in Sepang for RM32.9 million.

The contract was awarded by Juara Gred Development Sdn Bhd to construct the main building and external works of 28 units of three-storey semi-detached factories, for a provisional sum of RM32.9 million, according to a filing with Bursa Malaysia.

Hence, Jiankun (fundamental: 0.6; valuation: 0.6) is proposing to undertake a proposed diversification of its business, to include construction.

Based on the provision contract sum, Jiankun anticipates the group’s venture into the construction business may contribute 25% or more to its net profit in the future.

Property developer Talam Transform Bhd's wholly-owned subsidiary, Europlus Corp Bhd, has disposed of two adjacent plots of freehold land in Serendah, Selangor, to Metro Ingenious Sdn Bhd for RM106.86 million, to repay the group's debts.

In a filing to local bourse today, Talam Transform (fundamental: 0.45; valuation: 1.2) said the initial cost of investment in the two plots of land are RM15.06 million (27.8ha) and RM28.01 million (49.02ha).

The disposal would bring it a net gain of RM48.48 million or 1.17 sen per share, increase its net assets by 1.19 sen to 0.15 sen per share, and improve its gearing ratio to 0.3 from 0.51.

Europlus Corporation and Metro Ingenious, a wholly-owned subsidiary of TA Global Bhd (fundamental: 1.05; valuation: 2.4), entered into a sales and purchase agreement over the disposal today.

The disposal is expected to be completed within seven days of the SPA signing, or one month after the expiry of the completion date.

Agrochemicals and disposable healthcare products manufacturer Halex Holdings Bhd is acquiring the remaining shares it does not own in its 25%-owned associate company Kensington Development Sdn Bhd, to diversify into property development.

In a filing with Bursa Malaysia this evening, Halex (fundamental: 1.95; valuation: 1.8) said its wholly-owned subsidiary, Halex Realty Sdn Bhd, has entered into a conditional share acquisition agreement today with British Virgin Islands-based Bestempire Ltd, to acquire the remaining 75% stake in Kensington Development for RM21 million, cash.

Under the agreement, Halex Realty will also have to settle an outstanding shareholder’s loan of RM3.69 million, given to Kensington Development by Bestempire.

Barring any unforeseen circumstances, Halex expects to complete the corporate exercise by the third quarter of 2015.

Halex said the acquisition is in line with its plan to diversify into other viable business, to enhance its profitability.

Higher education provider Masterskill Education Group Bhd's executive director and single largest shareholder Siva Kumar Jeyapalan has sold all his shares in the company to industry peer SMRT Holdings Bhd today.

In a filing today with the local bourse, the education group said Siva has disposed of his 23% stake, comprising 86.5 million shares at 60 sen apiece, for a total value of RM51.9 million.

This means SMRT (fundamental: 1.5; valuation: 1.8) completed the acquisition of 23% of the voting shares of Masterskill, via its subsidiary Strategic Ambience Sdn Bhd.

Wood-based furniture maker SYF Resources Bhd is mulling the acquisition of seven pieces of freehold agriculture land in Mukim Rompin, Negeri Sembilan, for RM14 million, after its subsidiary entered into a tenancy agreement with condition to purchase the assets.

Under the agreement, Great Platform Sdn Bhd (GPSB) — wholly-owned unit of SYF (fundamental: 1.3; valuation: 1.8) — will rent seven adjoining pieces of freehold agriculture land, measuring approximately 40 acres (16.2ha), together with factories erected thereon, at a monthly rental of RM52,500.

SYF also has the option of purchasing the assets on or before December 31 this year, at the said purchase price, according to the agreement submitted to Bursa Malaysia.

SYF said the proposed acquisition is in line with the group’s strategy to seek growth from upstream activities.

Tissue products maker NTPM Holdings Bhd saw its net profit for the third quarter ended Jan 31, 2015 (3QFY15) fall 6.48% to RM13.27 million or 1.2 sen per share, from RM14.19 million or 1.3 sen per share a year ago.

In its quarter report to Bursa Malaysia, NTPM (fundamental: 1.1; valuation: 0.9) attributed the lower net profit to the rising cost of raw material, labour, utility, financing charges and higher loss on foreign exchange.  

However, revenue for the quarter inched up by 1.68% to RM142.39 million, from RM140.03 million last year.  

Despite the lower net profit, the group has announced a first interim single-tier dividend of 7.25% or 0.73 sen per share, which shall be paid on April 16 this year.  

For the cumulative nine months (9MFY15), its net profit dipped 30.15% to RM29.47 million, from RM42.19 million in 9MFY14, even as revenue strengthened to RM412.72 million — 1.8% higher than RM405.43 million previously — mainly due to increase in sales of baby diapers.  

Flour miller Kuantan Flour Mills Bhd’s (KFM) proposed reverse takeover (RTO) exercise of water filtration systems provider NEP Holdings (M) Bhd (NEP) has been terminated, as both parties were not able to execute the definitive agreement by the agreed deadline.

Under the heads of agreement (HoA) between KFM (fundamental: 0.8, valuation: 0.6) and NEP signed in January 2015, both parties are obliged to execute a definitive agreement no later than two months from the date of the HoA or such other date as the parties may agree in writing.

KFM told Bursa today, it had decided not to seek for an extension of time to execute the definitive agreement and therefore had terminated the HoA.

Offshore support vessel (OSV) provider Icon Offshore Bhd saw its chief executive officer Dr Jamal Yusof cease to be major shareholder, after several share disposals over the past two weeks.

According to Icon Offshore (fundamental: 0.85; valuation: 1.2)’s filings with the local exchange, Dr Jamal ceased to be a major shareholder since March 9 this year. The statements however, did not indicate his stake after he sold a collective 0.34% in the company.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)