Archive for September, 2010

IRs – Integrated Resorts all the rage !

Thursday, September 23rd, 2010

Karambunai shares surge 45pc on casino report

By Lee Wei Lian

September 22, 2010

KUALA LUMPUR, Sept 22 – Shares of Karambunai Corp Berhad surged 45 per cent to 8 sen today following The Malaysian Insider report that a proposed Integrated Resort (IR) at Karambunai in Sabah could potentially include a casino.

Karambunai’s main business is operating the Nexus Karambunai resort and is linked to Hong Kong listed NagaCorp Ltd which operates a casino in Phnom Penh,Cambodia. NagaCorp’s founder and CEO Tan Sri Dr Chen Lip Keong is also president of Karambunai Corp.

At 3.15 pm, it was up nearly three sen to 8 sen with 14.5 million shares done.

The Malaysian Insider

wrote yesterday that Malaysia appears to have jumped on the IR bandwagon with the unveiling today of a proposed 500-acre “eco-nature” resort in Sabah as part of the Economic Transformation Programme.Sources told The Malaysian Insider that the option to build a casino is on the table for the Karambunai IR – alongside a mangrove centre, water theme park and waterfront properties – to ensure a higher return on investment (ROI).

Although the presentation panels for the development made no mention of any casino, they repeatedly referenced Singapore’s highly successful Marina Bay Sands as well as Resort World Manila in the Philippines and Vietnam’s Ho Tram Strip – all of which are casino-anchored IRs.

One illustration, entitled “Case for Change”, argued that Malaysia lagged behind regional competitors in tapping into the strong demand for IRs from countries like China, Indonesia and Thailand, and pointed out that Singapore had already seen a 21 per cent increase in tourist arrivals since opening Marina Bay Sands and Resort World Singapore.

The Malaysian Insider

also understands that if a casino is built as part of the Karambunai IR, international players such as The Sands might be roped in to run it rather than local operator Genting.Some analysts however said that a new casino in Sabah would face obstacles.

“We note the rumour of a casino in Sabah but believe there are still many hurdles faced by this proposal for now,” said OSK Research in a report today.

PM/FM stepping hard on the accelerator to fuel the Nation’s Economic Growth !

Monday, September 20th, 2010

The “GREEN” lights on and no holding back, generators going full steam ! Call it by whatever name and terms you like, the “Magician” pulling out from his bag of “tricks” and waving his magical wand ; the Bulls are set to run the Bursa Malaysia Market FBM KLCI to another level high breaking the previous high of ~1525 points set during Pak Lah’s time ! It seems that precedent has been set that the PM/FM of the day always bring the KLCI higher the those set earlier by his predecessors ! Some analysts even predict our FBM KLCI to hit 2600 points but without setting any time frame as he compares the Secular Bull Markets of a few successful South East Asian Markets to the Malaysian and opines that it is possible ! 

With the latest “POSITIVE” announcements and development going forward and the up coming 2011 Budget schedule to be announced on 15/10/2010, Sarawak State Election and  the General Election not far from “NOW”, what is seen from now are all gearing up towards these !  So the BULL will run and I optimistically think so ! 

With streams of good news flowing, post raya, pre Diwali and early “SEASON’s GREETING” has come a calling ! Ho ho ho and Jingles all the way !

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O&G, energy to boost gross national income by RM74.6b under National Key Economic Area

Written by Melody Song

Monday, 20 September 2010 12:38

KUALA LUMPUR: The Malaysian government hopes to see an additional US$24 billion (RM74.6 billion) contribution to gross national income (GNI) through the oil, gas and energy (OGE) sector in the next decade as one of the 12 National Key Economic Areas (NKEA), according to sources.

The three-pronged strategy led by the Performance Management and Delivery Unit (Pemandu) will be to sustain, grow and diversify the OGE sector. It is expected to generate 51,000 new jobs from entry-point projects and other business opportunities related to the sector.

In order to fund the proposed initiatives, US$100 billion of investment over the 10-year period would be required, with 76% of the funds coming from government-linked companies (GLCs), 20% from the private sector, and 4% from public investments.

According to sources, some of the key milestones are to import liquefied natural gases (LNG) by 2012 as a fuel substitute and to create new industries, to reduce the energy bill by 15% by 2014 and to have in place a regional oil storage and trading hub with a capacity of 10 million tonnes by 2017.

(Stocks to watch : DIALOG, RAMUNIA, FRONTKEN, KNM,KENCANA,SIME ENG & etc )

The deepwater oil terminal is proposed to be built in Pengerang, Johor, to complement Singapore’s terminal and storage facility whose expansion is restricted by limited land. It is envisaged that the downstream project would be based on the Amsterdam-Rotterdam-Antwerp (ARA) area in Europe.

The proposed terminal, to be funded via private investments, would have the potential for the development of downstream industries including a refinery and oil-based petrochemical complex as well as a regasification terminal. It is expected to add US$500 million to overall GNI and create an additional 800 jobs by 2020.

By 2020, the lab envisages the country having two gigawatt (GW) nuclear power, one GW of solar power and five GW of hydro power. It is understood that to have nuclear power by 2021, the government needs to take action immediately.

(Stocks to watch : ZELAN, WCT, YTLPWR & other Power Specialists Counters you may think of )

Sarawak is seen to be the key area to drive industrial growth, with hydro plants expected to contribute about US$1.8 billion in GNI by 2020. Meanwhile, solar power is also seen as a good alternative for capacity build-up post 2015 due to falling costs.

Another of the OGE lab’s aims is to make Malaysia the main Asian hub for oil field services by increasing the presence of major oilfield services players, creating regional fabrication leaders and by encouraging joint ventures with world-class companies.

These moves come on the back of slower compound annual growth rate (CAGR) of oil production over the last decade and smaller average size of new discoveries following the increase in exploration activities.

(KNM, SAPCRES, HANDAL, and other Oil rig building Stocks )

It is understood that “aggressive” plans and measures comprising exploration, enhanced oil recovery and small fields are in place to make up for depleting reserves to sustain present oil production levels of 550 thousand to 600 thousand barrels per day (kbd) to sustain GNI at levels of around US$18.6 billion.

According to statistics, Asia’s appetite for crude oil is expected to grow at 420 thousand barrels per day (kbd) per year. At present, consumption levels for the continent are 21.6 million barrels per day and this figure is expected to grow to 23.7 million barrels per day in 2015.

Some of the key players in the initiative include the Ministry of Energy, Green Technology and Water, the Ministry of International Trade and Industry (Miti), Petroliam Nasional Bhd (Petronas), the Malaysian Nuclear Agency and the Malaysian Industrial Development Authority (Mida).

The 12 NKEAs under the Government Transformation Plan (GTP) are oil, gas and energy, palm oil, financial services and capital markets, wholesale, retail and distribution, tourism, telecommunications, education, electrical and electronics, business services, health services, agriculture and the urban revitalisation of Greater Kuala Lumpur.

(All stocks related to such mentioned Sectors are worth to look at )

Earlier this month, Second Fnance Minister Datuk Seri Ahmad Husni Hanadzlah had earlier said that the full report on the New Economic Model (NEM) transformation would be made public next month.

He had also said that 92% of the investments were expected to come from the private sector, including GLCs.

This article appeared in The Edge Financial Daily, September 20, 2010.

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September 20, 2010 20:22 PM

Malaysia-Singapore To Settle KTM Land Development Charges In Arbitration Court

By Zakaria Abdul Wahab

SINGAPORE, Sept 20 (Bernama) – Malaysia and Singapore have agreed to bring the outstanding issue on the development charges payable on Keretapi Tanah Melayu Berhad (KTMB) land in the city-state that will be jointly developed by both countries, to the international court for arbitration.

According to a joint statement issued after Malaysian Prime Minister Datuk Seri Najib Tun Razak met his Singapore counterpart Lee Hsien Loong at the Istana here Monday, both leaders agreed to settle the issue amicably through arbitration under the auspices of the Permanent Court of Arbitration.

The statement said both countries had different views relating to the charges payable on the three parcels of Points of Agreement (POA) land in Tanjong Pagar, Kranji and Woodlands.

The three parcels of land are expected to be developed by a 60-40 joint-venture company, M-S Pte Ltd, to be set up between Malaysia’s Khazanah Nasional Berhad and Singapore’s Temasek Holdings Ltd.

Najib and Lee had further agreed to accept the arbitration award as final and binding.

It is understood that the development charges, which applied to any business which wants to develop any land in Singapore, will be significant if the three parcels of land are going to be developed.

The contention now is that based on the POA entered into, by both countries in 1990, the clause on who should pay the development charges was not clear enough.

Singapore interpreted that the company should pay for the development charges but Malaysia said there should be no cost at all.

However, Najib and Lee agreed that the arbitration would proceed on its own track, and should not affect the implementation of the POA and the other bilateral initiatives agreed upon, in their first meeting here on May 24, this year.

In that meeting, Malaysia agreed to move the Keretapi Tanah Melayu Berhad (KTMB) Tanjong Pagar station to the Woodlands Train Checkpoint by July 1, next year, and the three parcels of land would be vested in M-S Pte Ltd for joint development and swapped with several pieces of land in Marina South and Ophir-Rochor.

Speaking at a joint press conference later with Lee, Najib said the issue was not a major problem but it was important for they wanted an agreement (POA) that would survive the test of time.

Najib said they wanted to make it a legally and politically correct agreement that would be accepted by both peoples of Malaysia and Singapore and their future generations.

Najib said: This agreement signifies the final chapter in the long-standing arrangement which started 20 years ago.

We both are delighted and as well as relieved in a sense that we can put this behind us and move forward.”

The prime minister pointed out that Singapore and Lee had shown deep commitment in addressing the POA which was of mutual benefit to both sides, resulting in the old version of the POA further enhanced.

On June 22, this year, in follow-up talks with Najib in Putrajaya, Lee conveyed Singapore s offer on the land swap.

Following that meeting, Lee sent a revised land swap offer to Najib on June 28.

Najib accepted the offer on Sept 17, and Lee replied two days later, confirming his agreement in which the Singapore Government should vest four land parcels in Marina South and two land parcels in Ophir-Rochor in M-S Pte Ltd, in lieu of the POA lands.

Both leaders said the discussion on the details of the implementation of the POA by the Joint Implementation Team would be concluded by this Dec 31.

They also reiterated their commitment to the matters set out in the May 24 meeting, including the 50-50 joint-venture company between Khazanah and Temasek to undertake the development of the iconic wellness township project in Iskandar Malaysia and the joint development of a rapid transit system link between Johor Bharu and Singapore.

– Bernama

(Stocks to watch : Iskandar related Construction and Properties Counters like UEMLand, MRCB, TEBRAU, BJASSETS, DIJACOR, PJDev, DBhd , MPCorp, LBS, Plenitude, Glomac, DAiman, Mahsing, SPSetia, Crescendo, HuaYang, and etc)

 

A “GEM” unveiled ?

Monday, September 13th, 2010
 

With EPF, Malaysia Government Link Companies, Banks, Funds and Private Companies investing abroad to widen their earning base, so investors too need to think, grow and invest globally ! Here’s a counter that has a good chance to grow like that of it’s sister company in Singapore for those who have missed earlier at your own risk !   

 
Genting HK: a turnaround story 
GENTING HK

GENTING HK

 

 

SOMETIMES the headlines don’t tell the whole story. A case in point is the recent results of Genting Hong Kong.

 

The company recently reported a first-half net profit of US$12 million, reversing a loss of US$34.5 million during the same period last year (though Genting HK was a different animal then). But after stripping out US$14.4 million in one-off gains, Genting HK turned in a core net loss of US$3 million for the first six months of this year, a figure which fell far short of analysts’ estimates of some US$96 million.

 

But what the market appears to have missed is the fact that this company made a huge turnaround during its second quarter.

 

Genting HK, once known as Star Cruises, is a three-pronged US$1.9 billion market-cap gaming entity comprising Star Cruises in Asia, Norwegian Cruise Line (NCL) in the US, and Resorts World Manila (RWM) in the Philippines.

 

The interesting bits about the company emerged during a briefing provided by management a day after the Aug 28 results.

 

During the briefing, the company’s management said gaming turnover numbers had exceeded all expectations during the second quarter, and hinted that the numbers in July and August continued to take off. Analysts and some of the more privileged investors were told that on some days, wins at its Manila casino could match any other casino in the world, based on return on capital invested.

 


 

The best daily win last month exceeded US$7 million, the equivalent of S$10 million. This should be a familiar number to anyone who recently followed the results unveiled by Genting Singapore’s Resorts World Sentosa, which reported over S$900 million in revenue for the quarter, or S$300 million a month, which translates to S$10 million in takings per day.

 

The interesting thing is that RWM achieved this with minimal marketing effort and without the huge capital outlays of the Singapore casinos.

 

The casino, which is still in its early stages of development, currently operates 199 tables and 1,200 slot machines. This is expected to increase by 50 per cent when it opens its third gaming floor in the final quarter of this year. But RWM has also identified a second site, and has a gaming licence allowing it to operate some 2,000 tables and 7,000 slot machines over the two sites.

 

In comparison, RWS and Marina Bay Sands each have about 500 tables and 1,300 slot machines.

 

There is a nice parallel here with Genting Singapore which, after a somewhat undistinguished start marked by a huge writedown of its London gaming assets, took off during its second quarter to post S$396 million in earnings to end-June.

 

But Genting HK has several advantages over its Singapore cousin and Malaysian parent.

 

For one thing, the captive Philippines market is young and huge, with its population of almost 100 million. And as the only luxury casino in the country, it faces minimal competition.

 

Meanwhile, reports emerged yesterday about the Genting group entering into in discussions with the Philippines government on the possible purchase of the latter’s state-owned gaming assets. These assets, held under state-controlled PagCor, comprise over 40 small casinos which raked in almost S$900 million in income during 2008. If this latest deal does happen, it could significantly enlarge Genting HK’s gaming portfolio and revenues.

 

Meanwhile, through its Star Cruises, which has been plying the Hong Kong-Taiwan route since May 2009, Genting HK is laying the foundations for its involvement in Taiwan’s ambitious integrated resort project. The Taipei government has reportedly already appointed consultants to look into this.

 

Numbers are important and do tell a story.

 

But sometimes, looking beyond just historical earnings data, and listening to guidance provided by management, can provide more colour and clarity about the outlook and prospects for a company. In the case of Genting HK, the picture appears a lot more colourful and exciting than its first-half earnings numbers suggested.

-half earnings numbers suggested.

 

 

0803 GMT [Dow Jones]

 

Genting Hong Kong (S21.SG), Genting Singapore (G13.SG) most sought-after stocks in

 

Singapore, together accounting for about one-third of market”s total volume. Genting Hong

 

Kong +11.4% at US$0.49, extending 54.4% gain so far this month, on continued optimism

 

over earnings prospects given cruise operator”s 50%-owned gaming investment Resorts

 

World Manila. Just when interest in sister firm Genting Singapore starting to soften in

 

recent sessions after strong rally in past months (stock up by milder 8.3% since beginning

 

September), shares +6.6% at new multi-year high of S$1.95. “There were a few kind

 

reports on Genting Singapore today,” says trader at local brokerage, referring to CLSA”s

 

target price upgrade to S$3.00 from S$2.00 to factor in better earnings visibility, plus

 

Daiwa”s initiation at Outperform with S$2.06 target. Huge volume on both stocks indicates

 

strong momentum, which could last in coming days despite technical indicators showing

 

both severely overbought. (frankie.ho@dowjones.com)

 

 

 

Will we see a new high for the FBM KLCI before year end ?
Will the FBM KLCI refresh its rally to the immediate hurdle of 1,450, followed by the all-time high level at 1,524.69 ??
 

My 2 cents opinion : An Optimistic “AYE” !



FBM KLCI todate

FBM KLCI todate

  

 

 

 

 

 

 

Hari Raya Greetings !

Friday, September 10th, 2010

  

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