Capital markets news summary for Tue 21 Feb 2023

Capital markets news summary for Tue 21 Feb 2023

WCE Holdings selling property development company to IJM for RM494m

The company – which is 26.65% owned by IJM – is the developer of the RM5.044b West Coast Expressway from Banting, Selangor to Taiping Selatan, Perak. Construction is at 82% and 4 of the 11 sections have been completed with 4 more expected by end-2023. The entire highway will be opened in 2024, delayed from the original 2019 opening. The proceeds from the sale of the company’s 40% shareholding in Radiant Pillar Sdn Bhd (RPSB) to IJM Properties will be used to fund the construction of the highway. RPSB is the developer of the 1,879-acre Bandar Rimbayu in Kuala Langat, Selangor. WCE Holdings Berhad posted a net loss of RM55.42m for 6M ended 30 Sep 2022 down from RM78.36m a year ago despite lower revenues of RM225.87m from RM235.54m. WCE closed at 38 sen while IJM closed at RM1.57.

FWD and other investors buying 70% of Gibraltar BSN

The acquisition from The Prudential Insurance Company of America will be completed by 2Q2023. Hong Kong-based FWD Group was founded by Pacific Century Group which is owned by Richard Li – the son of Hong Kong billionaire Li Ka-shing and founder of Pacific Century CyberWorks which bought Cable & Wireless HKT for USD38b in 2000. FWD has been in Malaysia since Mar 2019 offering family takaful products. The acquisition will enable the company to expand into conventional insurance. There are plans to rebrand the Gibraltar BSN business later. FWD Group which in May 2022 had delayed a Hong Kong listing that would have valued the company at USD9b, is now eyeing a 2023 listing.

MBM Resources 2022 net profit up 65%

The automotive trader and parts manufacturer registered net profit of RM281.55m from RM171.22m in 2021. Revenue was up 50.9% from RM1.52b to RM2.30b contributed by motor trading and auto parts manufacturing which benefitted from the sales tax exemption, higher vehicle supplies, improved operating conditions and production demand. The motor trading division achieved a 49.7% rise in vehicle sales volume from the record high total industry volume of 720,658. Auto parts manufacturing posted revenue of RM316.1m, up 53%. Downside risks for 2023 include moderation in the economy, high inflation rate and increased borrowing costs which may affect consumer demand. Upside will come from the rush to deliver backlog orders by Mar 2023, the introduction of new models and sales of newly-launched electric vehicles. The counter closed at RM3.79.

ECA Integrated Solution’s pioneer status extended for another 5 years

The automated test handling equipment maker and integrated assembly line original equipment manufacturer received the pioneer status from the Ministry of International Trade and Industry for a 10-year period from Nov 2017 to Nov 2027. Following the expiry of the first 5-year period in Nov 2022, the pioneer status has been extended for the balance 5 years after certain conditions were fulfilled. The status provides income tax exemption for promoted activities. The company was established in 1993 and serves manufacturing companies involved in semiconductors, automotive, e-mobility, electronic devices and energy. The tax incentives enable the company to allocate more funds towards investments, and research and development. The company was listed on the ACE Market on 23 Nov 2022. The share price closed at 98 sen up from its IPO price of 17 sen.

Princeton Digital spending USD1b on new data centres in Asia

The Singapore-based company’s plans for new data centres within Southeast Asia is to support its operations in Singapore. The company expects to see revenues of USD1b over the next 3-4 years heading towards Singapore. The new campus to be built in Batam, Indonesia has already secured 96MW of power. The region’s digital economy is expected to reach USD330b by 2025 as reported by Google, Temasek and Bain & Co as mobile and online service adoption spurs demand for cloud infrastructure and services. Apart from Southeast Asia, the company will be opening its first data centre in India with an investment of USD300m.