|
SECTOR RESEARCH
|
|
|
|
|
|
|
|
2017 Outlook
by Chee
Ting Ong
|
|
|
|
|
|
|
|
|
|
|
There is opportunity for a trade in 1Q17, as CPO price
will stay lofty at ~MYR3,000/t during the low crop months. But we
will turn cautious once yield recovery happens from 2Q17. Our 12M
fundamental view for the sector remains a NEUTRAL. 2017’s outlook will
largely be a mirror image of 2016 with a year of two halves. We
prefer Indonesia planters over Malaysia given their cheaper
valuations and faster yield recovery. Our BUYs in the region are
BPLANT, SOP, BAL, AALI, LSIP, and TBLA.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NEWS
|
|
|
Outside Malaysia:
U.S: Manufacturing in December expands at fastest pace in
two years, reflecting firmer output and the biggest pickup in orders
growth since August 2009. The Institute for Supply Management said that
its index increased to 54.7, the fourth straight advance, from 53.2 a
month earlier. The ISM’s measure of orders surged 7.2 points, while its
gauge of prices paid for materials climbed to the highest level since
June 2011. The jump in bookings, including the strongest pace of export
orders since May 2014, will help keep factories on solid footing early
this year as business confidence improves. Plant managers responded to
the brighter outlook by adding to staff at the fastest pace since the
middle of 2015, according to the ISM’s report. (Source: Bloomberg)
Germany: Unemployment extended its decline in December
amid signs that growth in Europe’s largest economy accelerated at the end
of last year. The number of people out of work fell by a seasonally
adjusted 17,000 to 2.638 million, data from the Federal Labor Agency in
Nuremberg showed. The jobless rate remained unchanged at 6%, matching the
lowest level since reunification. (Source: Bloomberg)
U.K: Manufacturing grew at the fastest pace in 2 1/2 years
in December, helped by the pound’s depreciation since the vote to leave
the European Union. After dipping sharply in the wake of the Brexit
referendum -- dropping below the key 50 level in July -- the IHS Markit
Purchasing Managers Index has since recovered strongly and was at 56.1
last month. That’s up from 53.6 in November and marks the highest reading
since June 2014. A measure of new orders also rose. (Source: Bloomberg)
China: PBOC injects markets with record MLF funds amid
outflow pressure. China has made unprecedented injections into the
financial system through one lending tool amid acceleration in capital
flowing out of the world’s second- largest economy. The balance in the
Medium-term Lending Facility increased CNY 721.5b (USD 104b) in December,
People’s Bank of China data showed. That was the biggest jump since the
central bank started publishing information about the liquidity tool in
September 2014. The total outstanding for those operations was CNY
3.46tr, also a record, PBOC data show. Capital outflow pressures have
intensified as the yuan posted its steepest annual drop in more than two
decades. The central bank is stepping up its push to maintain sufficient
funding in the market while also transitioning to a more neutral monetary
policy and putting more focus on reducing risks from high debt levels.
(Source: Bloomberg)
Australia: House values increased at the fastest pace in
seven years in 2016, as record-low interest rates helped fuel demand for
property despite warnings such price increases may be unsustainable. The
average dwelling value in the nation’s eight state and mainland territory
capitals rose 10.9% last year, compared to 7.8% in 2015, data from
CoreLogic Inc.showed. That’s the biggest increase since 2009. (Source:
Bloomberg)
|
|
|
|
|
|
|
Other News:
Vivocom: Wins job worth MYR71.3m. Its subsidiary Vivocom
Enterprise S/B (VESB) has won two contracts worth a combined MYR71.3m for
construction works. VESB has bagged a MYR19.3m contract from Oriental
Mace S/B to construct a factory, warehouse and office buildings in Bandar
Baru Enstek, Seremban, Negeri Sembilan. This project will be completed
within 15 months from the date of commencement. VESB also won a MYR52m
contract from Udaran S/B to construct a mixed development comprising
two-storey terrace houses and commercial buildings in Marang, Terengganu.
This project will be completed within 24 months from the date of
commencement. (Source: The Edge Financial Daily)
Favelle Favco: Secures MYR64m orders. The group has
secured MYR64m worth of orders in December 2016 to supply tower cranes to
ALE UK Holdings, Marr Contracting Pty Ltd, TES Inc and Stride High Pty
Ltd. Favelle Favco said the four orders to supply tower cranes were
bagged via its wholly-owned subsidiaries Kroll Cranes A/S, Favelle Favco
Cranes Pty Ltd and Favelle Favco Cranes (USA) Inc. The tower cranes will
be delivered during the second and third quarter of 2017. (Source: The
Edge Financial Daily)
Gunung Capital: To provide bus transport for armed forces’
children. Its unit GPB Corp S/B has clinched a three-year contract worth
up to MYR43.9m to provide school bus services for children of the
Malaysian Armed Forces personnel nationwide. The duration of the contract
is from Jan 1, 2017, to Nov 30, 2019. Gunung Capital estimated that a
total of 233 44-seater buses and 85 25-seater buses would be required to
fulfill its obligations under the deal. (Source: The Star)
Wah Seong: In JV to sell building material online. The
group has tied up with Hong Kong firm Lesso Home Service Holdings Ltd to
sell products and services via an online platform facilitated by the
latter. Its wholly-owned unit Syn Tai Hung Trading S/B (STHT) has inked a
joint venture (JV) and shareholders' agreement to effect the tie-up with
Lesso today, which will see the two companies combining their
capabilities and expertise via a JV company to become an integrated sales
and service centre. The proposed new JVco will be 49%-held by STHT and
51% by Lesso. (Source: The Edge Financial Daily)
Petronas: Among 29 firms shortlisted to bid for Iran
projects. Iran has published a list of 29 major companies from Europe and
Asia approved to bid for oil and gas projects after the lifting of
sanctions over its nuclear programme. Among those from Asia were China’s
CNPC and Sinopec International, the Japanese Mitsubishi Corporation and
Japan Petroleum Exploration, Malaysia’s Petroliam Nasional Bhd
(Petronas), and South Korea’s Korea Gas Corporation and Posco Daewoo. The
National Iranian Oil Co is to offer tenders for exploration and
production projects at oil and gas fields in the country, the oil
ministry’s news service Shana reported yesterday. (Source: The Sun Daily)
|
|
|
|
|
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.