TENAGA, LITRAK,AXIATA,SIME DARBY, AIR ASIA

The government has decided that the average electricity tariff will be retained at 31.31sen per kWh until the end of the year. The government had decided that the existing gas price of RM10.70/MMBtu be retained. In line with this decision, the average electricity rate will be retained at 31.31sen/kWh until the end of the year 2009. Tenaga Nasional Bhd (TNB MK, Buy,
TP: RM9.90) said they stood by the government’s decision to keep the tariff rates and gas price. (Financial Daily)
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Litrak (LTK MK, Hold, TP: RM2.22) the concessionaire of the Damansara-Puchong Expressway (LDP) has assured roadusers that the highway’s Puchong Jaya Interchange is safe for the public to use. The statement was made as many roadusers were alarmed by cracks that have appeared at the base of the bridge. The group stated that the cracks were no threat to safety and that it had discovered the cracks during an annual inspection programme conducted last year. It also
stated that repair works had started in March. The group engineering department senior manager Francisco Anthony Dass stated that the cracks were most probably due to shrinkage and were only hairline cracks. (The Star)

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Luxemborg-based Millicom International Cellular, which owns Cambodia’s number one mobile operator Mobitel, expects to complete the sale of its Asian mobile assets by the first quarter of 2010. Axiata Group Bhd (AXIATA MK, Buy, TP: RM3.12) is believed to be among parties that have submitted non-binding bids for Millicom’s assets. Milicom is looking to sell 58.4% of Cambodia’s Mobitel, 100% of Celtel Sri Lanka (Tigo) as well as 74.1% stake in Millicom Laos Co Ltd. (Financial Daily)

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Hyundai-Sime Darby Motors Sdn Bhd (HSDM), a unit of Sime Darby Bhd (SIME MK, Buy, TP: RM7.70) targets to maintain car sales of 7,000 units this year despite sluggish economic condition via several promotional packages. These include an interest rate of 1.99%, compared with 3% previously, for a five year loan as well as the Hyundai Assurance programme that helps car buyers to cope with their liabilities in the event they lose their jobs within one year of buying a Hyundai car, HSDM head of marketing Kelvin Chuah said. (Financial Daily)

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A merger between AirAsia X and AirAsia Bhd (AIRA MK, Buy, TP:RM1.90) makes business sense and the combined balance sheet would make sourcing for future funding much easier, said AirAsia X chief executive officer Azran Osman- Rani. AirAsia is said to need the growth from AirAsia X and the merger would allow it to tap growth opportunities in the longhaul
markets. Azran said that AirAsia X had a net profit of RM18m in 1Q09 with a positive net cashflow. He also said that a share swap was likely but AirAsia had an option to increase it stake from 16% to 30% and with that it could equity account its venture in AirAsia X. (StarBiz)
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