KLSE NEWS 14.8.2009

AMMB Holdings Bhd (AMM MK, Buy, TP: RM4.76) has forecasted a net profit of between RM800m and RM900m in itsfinancial year ending March 31, 2010 (FY10) versus RM860m in FY09. This was despite posting a 27.3% rise in net profit toRM258.2m in its first quarter ended June 30, 2009 from RM202.9m a year earlier. The banking group expects net nonperformingloans to rise to nearly 4% at end FY10. Managing director Cheah Tek Kuang highlighted uncertainties over thestrength of the economic recovery, adding that there was also a lag effect to consider, hence “if you take a lag effect of about12 months from last October, the impact will be felt in our third or fourth quarter.” (Financial Daily)

* * * * *

Sime Darby Bhd (SIME MK, Hold, TP: RM7.70) does not expect to immediately list its plantation business – the group’skey profit driver – as part of a detailed review of its operations, according to a source with direct knowledge of the plan.However, the source said that there was definitely a review of the automobile sector as the unit is facing stiff competitionregionally. (Starbiz)

* * * * *

The owners of the upcoming two-phase Setia City Mall may consider selling it to a real estate investment trust (REIT) ifa good offer comes along. But for now, the retail entity on a 12.2ha (30.5 acre) site within the Setia Alam township willserve as a rental generation asset. The project, jointly developed by SP Setia Bhd (SPSB MK, Sell, TP: RM2.80) and LendLease Asian Retail Investment Fund 2, is expected to be completed within five years with a net lettable area of up to1.7m sq ftwith some 300 shops. “If somebody offers us a very good price, we will consult each other on whether we want to sell, or putinto a REIT. It’s a matter of pricing,” said SP Setia president Tan Sri Liew Kee Sin. (Financial Daily)

* * * * *

Fajarbaru Builder Group Bhd has proposed a private placement of up to 10% of its paid up capital to placees to beidentified and at an issue price to be fixed later. Fajarbaru said the placement shares would be issued based on a discountof not more than 10% from the five-day weighted average market price immediately preceding the price-fixing date. It will usethe proceeds for working capital. In addition, the company said it would serve to increase the capitalisation of the company andto further strengthen the balance sheet of the group. (Financial Daily)

* * * * *

Selangor Menteri Besar, Tan Sri Abdul Khalid Ibrahim said that the state expects to resolve its ongoing tussle with thestate's water asset concessionaires by the end of this month. He said that since Konsortium Abass Sdn Bhd and SyarikatPengular Air Sungai Selangor Sdn Bhd had accepted the state’s offer, it is now haggling over price with Syarikat Bekalan AirSelangor Sdn Bhd (Syabas), a 70% unit of Puncak Niaga (M) Sdn Bhd. He also said that once the price is resolved, the statewould not have any problems handling its other concessionaire Puncak Niaga (M) Sdn Bhd. (BT)

* * * * *

Domestic unemployment rate may rise to 4.5% by year-end from 3.7% last year, according to International Trade andIndustry Deputy Minister Datuk Mukhriz Tun Mahatir. He said most factories that had laid off workers had begun to take backformer employees after demand picked up. As of July 7, Mukhriz said, statistics compiled showed a cumulative figure of 38,732workers retrenched due to the economic crisis. Of the total 29,712 were permanently terminated while 9,020 acceptedvoluntary separation offers. In addition, 40,662 workers had their pay reduced while 4,112 were temporarily laid off. (Starbiz