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sapura energy 'buy', v.s. industry 'buy', spritzer 'neutral', pestech 'outperform' - pet resin

by:Cailong     2019-08-19
sapura energy \'buy\', v.s. industry \'buy\', spritzer \'neutral\', pestech \'outperform\'  -  pet resin
SAPURA energy by AmInvestment BankBuy BHD (maintained)Fair value: rm0.
55 PERMODALAN Nasional Bhd (PNB)
Will become the largest shareholder of Sapura with a stake of up to 40% (
From the current 12%)
Upon completion of the group's question of reaveable rights of up to RM4bil.
This involves a stake in 5-30 Sen. for-
The three foundations of each 10 Equity interest shares subscribed for in the new Islamic redeemable preferred stock (RCPS)
Per RCPS 41 sen, assigned by ratio of two RCPSto-five shares.
As this exceeds the mandatory acquisition threshold of 33%, PNB is applying for an exemption for a full acquisition of the remaining shares.
PNB has issued a letter of commitment to Sapura to subscribe for its rights and the excess shares and warrants not held by other shareholders, up to no more than 40% of the group's equity.
This could mean that PNB will account for 57% of the allotment.
PNB will also subscribe to the entire RM1bil RCPS product.
Assuming that the five ends of the rcp are fully converted-
Shares of PNB may rise further to 48% during the year.
However, AmInvestment Bank understands that Sapura intends to redeem it in full before the RCPS expires.
Through Sapura Technology Sdn Bhd, President and CEO Tan Sri shahrill shamdin also promised minimum rights to subscribe for RM300mil.
Maybank Investment Bank and Credit Suisse promise to subscribe for the remaining RM1bil equity shares not subscribed by PNB or shahrill, which means that the proposed exercise of rights is a "completed transaction"V. S.
Industry BHDBy UOB KayHianBuy (maintained)
Target price: rm1.
Industry (VSI)
Fourth quarter of the financial year 2018 (4Q18)
The performance was slightly higher than expected, and the core net profit of FY18 was rm159.
4mil, accounting for 107% of UOB KayHian and consen' full-year forecasts.
Core net profit does not include rm8.
6mil is related to the disposal of Qingdao electronics by its 43. 5%-
Writing with VS International Group
Related and property impairment losses in Vietnam (FY17: RM16.
Special items for 1mil).
The better performance is due-than-
Expected profit margins due to high sales of major customers increasing operating leverage.
Expected stronger first quarteron-
Quarterly increase in box sales
Thanks to the Black Friday event and the holiday season, products have been built for its main customers, in addition, it is expected that one of its main customers will launch new products in 2018. VSI’s run-
The rise in share prices may be due to potential new investments from one of its major customers.
Prime Minister Tun Mahathir Mohamad mentioned that major customers expressed interest in bringing new investments to Malaysia and improving the capacity of Malaysian engineers.
He added that the government will revise the "restrictive" policy so that key customers are more keen to invest in Malaysia.
"We believe that these investments may be related to the home appliance sector as key customers have invested heavily in building facilities for their other sectors in their home country," said Ubud Kayan.
BHD sparkling wine by MIDF ResearchNeutral (maintain)
Target price: rm2
27 spritzers fiscal year for the first half of 2018 (1H18)
Revenue grew by 32. 7% year-on-year (y-o-y)to RM13. 5mil.
This is due to the increase in local bottled water sales and the reduction in advertising and promotion costs in China.
For 2H18, MIDF Research expects revenue to be weak mainly due to rising sales costs.
Nevertheless, the reduction in operating losses in China will partially ease the situation and continue to maintain strong domestic performance.
About 70% of the sales Cost of Spritzer is on the packaging.
PET resin costs about 50% of packaging costs.
The price of PET Resin has risen 24%, according to research institutes. o-
Y or RM1, 000/ton, is consistent with the rising trend of oil prices and the weakening of ringgit.
Due to the above factors, management expects the price of its products to rise by 5%.
"We expect the operating losses of Chinese operations to be further reduced in fiscal 18 and further reduced from RM10mil in fiscal 17.
"Please note that the loss is reduced to RM2mil at 1H18.
"The operational losses recorded by FY17 are mainly affected by expensive advertising strategies," said MIDF Research . ".
Previously, the group focused on leasing space to display products in retail stores.
Since then, management has adjusted its marketing strategy to engage directly with consumers.
Although prices are expected to rise, MIDF Research believes sales growth remains at a single-digit high.
This is based on the expectation that Spritzer's competitors will also raise prices in response to higher PET resin costs.
Pestech international bhd from Kenanga research is better than the target price: rm1.
All of 95 pestechs-
State-owned subsidiary Pestech Technology Sdn Bhd accepted the bid letter from Syarikat Pembenaan Yeoh Tiong Lay Sdn Bhd under SIPP
Ytl jv for turnkey EPC and maintenance of electrified system for Gemas-
Johor Baru electric double
Tracking on fixed sub
Contract price RM399mil.
It will take 26 months for the project to be completed by April 2021.
Pestech's stock price has been down for more than two years, and it has finally won the much-anticipated project, which became complicated in the early days of ge14.
Since this announcement is only for the electrified part, Kenanga Research has learned that The Signal and Communication part of the value of the horse coin has not yet been announced.
Pestech and its partner Ansaldo should have better project opportunities as there are no other companies in the region that can do the signal part.
This is Pestech's second contract in FY19, with a total of 457mil, and the current total of orders exceeds RM2bil, which will keep them busy until 2021.
In the short term, double
The Signal and Communication work of rail transit is still its primary goal, while the East Coast Railway and KL-Singapore High-
The high-speed rail is two major local electrified projects that Pestech can participate in the bidding.
"We continue to love the role this niche utility infrastructure plays for its revenue growth story.
"In fact, after the stock price has been sluggish in the past two years and the earnings are still strong, its valuation is no longer too high," Kenanga Research said . ".
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