Friday 29 Mar 2024
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This article first appeared in The Edge Malaysia Weekly on April 23, 2018 - April 29, 2018

TRAFFIC in Kuala Lumpur city centre could be heavy on Monday as Public Bank Bhd’s shareholders flock downtown to attend the banking group’s annual general meeting at Shangri-La Hotel.

These shareholders should be a happy lot. The bank’s share price has been on a steady climb — hitting new highs every week since the start of the year — resulting in the local bank trading at the highest price-to-book value of over two times. Likewise, the group achieved a record net profit in the financial year ended Dec 31, 2017 (FY2017).

Cycle & Carriage Bintang Bhd’s (C&C) shareholders could be adding to the traffic volume too. Their AGM venue is less than 500m away from Public Bank’s. The luxury car dealer’s share price performance is quite a contrast to Public Bank’s. The stock drifted to a low of RM1.86 early this month — the lowest level since January 2015. Shareholders may be concerned about the company’s earnings prospects, given that C&C incurred a net loss of RM12.47 million in FY2017, despite Mercedes-Benz Malaysia Sdn Bhd’s car sales hitting a record high for four consecutive years.

Traffic at the Mid Valley Megamall could be congested too. There isn’t a mega sale there; it is because IGB Real Estate Investment Trust (REIT) is holding its AGM there. The REIT’s net property income and distributable income hit a record high of RM373.56 million and RM342.8 million respectively in FY2017. Shareholders are rewarded with a distribution per unit of 9.28 sen — the highest since listing.

On Tuesday, Lotte Chemical Titan Holding Bhd will hold its inaugural AGM — the first time the company is facing its shareholders. The turnout could be high, considering the eventful months that the petrochemical group has had since it made its debut on Bursa Malaysia last July.

The stock hit an all-time low of RM4.28 — down 34% from its initial public offering price of RM6.50 — after the company announced that a water cut has resulted in its net profit taking a plunge in the second quarter ended June 30, 2017.

The AGM will offer an opportunity for shareholders to seek clarifications on matters that had happened over the course of several months. That said, Lotte Chemical Titan’s price has regained most lost ground to close at RM6.33 last Friday.

However, Nestlé (M) Bhd’s AGM, which will also be held this week, will certainly be less tense and more cheerful, given that the group’s shareholders should be laughing all the way to the bank. Nestlé’s share price has surged above RM100 and marched to an all-time high of RM163. At one point, its year-to-date gain on market capitalisation was enough to buy out Manchester United Plc, the most expensive English football club, which is listed on the New York exchange.

Two more banks are holding their AGMs this week — RHB Bank Bhd on Wednesday and CIMB Group Holdings Bhd on Thursday. They could expect questions on their loan growth from the floor as they had missed their targets last year. Their shareholders would perhaps want to know what the banks could do to make up for the slower loan growth, in terms of earnings growth.

Among other companies that are having their shareholders’ meetings this week are Unisem Bhd, Dutch Lady Milk Industries Bhd and Telekom Malaysia Bhd.

Asean member countries’ leaders will come together this week for the 32nd Asean Summit Asean Economic Community Council Meeting in Singapore from April 25 to 28 to discuss regional and global issues. It would be interesting to see whether the leaders would discuss the mounting trade tension between the US and China.

The US will be announcing its first-quarter gross domestic product figure on Friday. Its growth pace is something that many are closely watching as it may decide the interest rate trend in the US going forward. Also, the US will be releasing its March trade balance and housing data.

Meanwhile, equity investors may have to be prepared for a volatile week as the US corporate earnings season starts. However, there is growing optimism that the corporate results would be positive and, thus, add fuel to the rally on the US market, which has rebounded from the recent low.

The UK and France will also be releasing its first-quarter GDP data. The European Central Bank and the Bank of Japan will deliver their monetary policy decisions this week.

 

 

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