Capital markets news summary for Mon 20 Feb 2023

Capital markets news summary for Mon 20 Feb 2023

CPO futures to trade lower this week

The active month of May 2023 crossed RM4,000 per tonne – the first time since 9 Jan –driven by Indonesia’s policy of suspending the unutilised export permits to safeguard the domestic supply of cooking oil during ramadhan. The strong trading last week boosted CPO prices to a 5-week high of RM4,131 per tonne for May 2023 – RM199 higher than a week ago – amid a weaker ringgit, stronger soybean oil prices and signs of demand rebounding. Traders may be encouraged towards profit-taking with CPO prices likely to trade RM3,900-RM4,000 per tonne this week, although trading will be based on production and export figures for the first 20 days in Feb to be released soon. Weekly volume grew from 235,346 lots to 282,503 lots. Physical CPO price for February South was RM4,080 per tonne, up RM180.

TPG, KWAP and EPF to buy Asia Pacific University

US-based private equity firm TPG Inc with USD135b in assets under management will be investing via The Rise Fund, a multi-sector global impact investment platform. The 3 parties signed a definitive agreement to purchase a controlling shareholding in the university from KV Asia – a Singapore-based private equity firm with a portfolio of investments in Malaysian, Indonesian and Singaporean assets. This is The Rise Fund’s 2nd education investment in Malaysia after International Medical University announced in Jun 2022. The fund’s other tertiary education assets in its portfolio include InStride and the Center for Education and Access in the US. No mention was made on the size and amount involved.

Asian Supply Base to build O&G crew change terminal in Labuan

The Sabah-owned company based in Labuan obtained an exemption order from the Sabah Home Affairs and Research Office (SHARO) on 22 Apr 2022 granting Asian Supply Base the right to assist its clients in obtaining approval from the SHARO and the Sabah Immigration Department (SID) to enter and exit oil platforms in Sabah’s waters. The crew are not allowed to disembark from their vessels. Discussions with the SHARO and the SID are ongoing for immigration and customs staff to be stationed at the terminal to facilitate crew changes at the jetty. Currently, contractors must divert their crew to Kota Kinabalu port to obtain immigration clearance before departing for the oil rigs.

KPJ’s net profit surged 214%

The healthcare company recorded net profit of RM171.99m in 2022 compared with RM54.79m in 2021. Revenue was up from RM2.59b to RM2.92b. The transition to Covid endemicity and reopening of borders boosted hospital activities with patient visits rising from 780,221 to 820,734 and bed occupancy rate improving from 46% to 64%. The results show that the company has exceeded pre-pandemic levels. Despite the global economic slowdown and inflationary pressures, the company looks to benefit from the turnaround in health tourism. KPJ closed at RM1.06.

Elna PCB is building a new RM1b plant in Penang

The printed circuit board (PCB) manufacturer with origins in Japan started construction in Seberang Perai Tengah in Dec 2022. The new plant – whose ground-breaking ceremony was performed on 18 Feb – has 10,289 square metres of space to produce PCBs for automotive, server, networking, laptop, desktop and consumer electronic products. Construction will be completed by Dec 2023 and production to begin in 2024. The plant will hire 1,000 people in engineering, manufacturing and quality management. Elna PCB has been in Malaysia since 1995 and became a member of Taiwan’s PSA Group in Apr 2018.