04/06/2025

BIZ & FINANCE WEDNESDAY | JUNE 4, 2025

20

MARKETS/FROM THE BROKERS

SUNBIZ presents extracts of a selection of commentaries and research reports received from stockbrokers on counters that could be of interest to investors.

DISCLAIMER: The information is extracted from stockbrokers’ commentaries and research reports and do not represent the views or opinions of Sun Media Corporation Sdn Bhd. It is not a solicitation, recommendation or an offer to buy or sell the equities featured. Sun Media Corporation shall not be liable or responsible for any consequences resulting from usage of the information.

[ Compiled by SunBiz Team

AirAsia expands Kota Kinabalu routes with Taipei-Fukuoka flight KOTA KINABALU: AirAsia Malaysia will strengthen the connectivity from its second-largest hub Kota Kinabalu with the launch of a brand new fifth-freedom route to Fukuoka, Japan, via Taipei. Starting from Aug 15, AirAsia will operate the additional route connecting Kota Kinabalu to Fukuoka via a short stopover in Taipei with daily flights. Taipei is one of AirAsia’s key virtual hubs within its extensive network. The new route provides more flexibility for Malaysians looking to explore more destinations in Japan, offering an alternative to fly from Kuala Lumpur to Fukuoka via Don Mueang (Thailand), operated by Thai AirAsia. CEO Datuk Captain Fareh Mazputra said: “We are excited to launch this new fifth-freedom flight from Taipei to Fukuoka, marking another significant milestone as we continue to explore new opportunities from our Kota Kinabalu hub. Since reinstating the Kota Kinabalu-Taipei route three years ago, we have flown more than 130,000 guests, and the numbers continue to grow. This launch aligns with our vision of connecting people across Asia, enhancing regional connectivity and boosting tourism opportunities. In celebration of the launch, AirAsia is offering special promotional fares for flights from Kota Kinabalu to Fukuoka starting from just RM609 all-in one way whereas flights from Fukuoka to Kota Kinabalu are also available from ¥21,390 (RM636) all-in one way. Guests can book their flights from now until June 8, 2025 for travelling between Aug 15, 2025 and March 29, 2026, available on the AirAsia MOVE app and airasia.com.

Ringgit slightly higher against dollar amid cautious sentiment THE ringgit closed higher against the US dollar yesterday, as traders remain cautious ahead of US President Donald Trump and China’s President Xi Jinping’s expected meeting this week, said an analyst. At 6 pm, the local note inched higher to 4.2425/2485 versus the greenback from last Friday’s close of 4.2530/2605. SPI Asset Management managing partner Stephen Innes said traders are slipping into a wait-and-see approach ahead of the Trump-Xi meeting, which could be a key factor in market risk for the rest of the week. “Given that the US is the world’s leading importer and China its largest exporter, their relationship could shift market sentiment in favour of the dollar, easing concerns about supply chain disruptions and imported inflation. “This dynamic leaves emerging currencies like the ringgit in a reactive position, caught between two economic superpowers whose trade decisions heavily influence global pricing trends,” he told Bernama. At the close, the ringgit traded lower against a basket of major currencies. It slipped against the Japanese yen to 2.9695/9739 from Friday’s close of 2.9531/9585, eased vis-a-vis the euro to 4.8415/8484 from 4.8169/8254, and depreciated against the British pound to 5.7337/7418 from 5.7284/7385 previously. The local note traded mixed against its Asean peers. It was slightly higher versus the Indonesian rupiah at 260.1/260.6 compared to 260.4/261.1 on Friday, and gained against the Philippine peso to 7.61/7.63 from 7.62/7.64 previously.

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

1 US Dollar

4.3070 2.8110 3.3480 3.1340 4.9340 2.6140 3.3480 5.8400 5.3080 3.5950 60.1900 67.7900 55.4500 5.1300 0.0274 3.0230 43.8700 1.5500 7.8500 119.3900 115.9900 24.9800 1.4800 46.5900 13.8300 118.5800 N/A

4.1710 2.6960 3.2480 3.0480 4.7710 2.5170 3.2480 5.6520 5.0790 3.3460 57.6100 62.3500 52.6600 4.8100 0.0248 2.9240 40.3300 1.4600 7.3900 113.3300 110.1100 22.5500 1.3600 42.4100 12.2600 112.3600 N/A

4.1610 2.6800 3.2400 3.0360 4.7510 2.5010 3.2400 5.6320 5.0640

1 Australian Dollar 1 Brunei Dollar 1 Canadian Dollar 1 New Zealand Dollar 1 Singapore Dollar 1 Sterling Pound 1 Swiss Franc 100 UAE Dirham 100 Bangladesh Taka 100 Chinese Renminbi 100 Danish Krone 100 Hongkong Dollar 100 Indian Rupee 100 Indonesian Rupiah 100 Japanese Yen 100 New Taiwan Dollar 100 Norwegian Krone 100 Pakistan Rupee 100 Philippine Peso 1 Euro

112.1600

3.1460

N/A

62.1500 52.4600 4.6100 0.0198 2.9140 40.1300 1.2600 7.1900 113.1300 109.9100 22.3500 1.1600 42.2100 11.8600 N/A

100 Qatar Riyal 100 Saudi Riyal

100 South Africa Rand 100 Sri Lanka Rupee 100 Swedish Krona

100 Thai Baht

Source: Malayan Banking Bhd/Bernama

Mah Sing Bhd Buy. Target price: RM1.83

SKP Resources Bhd Buy. Target price: RM1.25

Banks Neutral

June 3, 2025: RM0.99

June 3, 2025: RM1.07

Source: Bloomberg

Source: Company data, RHB

Source: Bloomberg

SKP Resources’ FY25 earnings met expectations thanks to volume recovery of Customer X. SKP’s earnings prospects will be largely anchored by Customer’s X stable demand whilst the commencement of new production lines should progressively drive growth. The company recorded a net profit of RM119 million (+23% YoY) – accounting for 100% and 98% of our and consensus’ forecasts. That said, we took the opportunity to revisit our volume and margin assumptions after obtaining the latest management guidance and this resulted in 9% and 5% cuts in our FY26-27 earnings. YoY, FY25 revenue surged 19% to RM2.2 billion, primarily aided by a volume recovery of Customer X from inventory adjustments in the prior year. Meanwhile, FY25 GPM slipped 0.9ppts, dragged by FX adjustments, higher wages, and start-up costs in relation to new production lines. That said, effective opex management has mitigated the impact, and correspondingly, FY25 net profit jumped 23% YoY to RM119 million. QoQ, Q4’25 revenue and net profit climbed 15% and 18% in reflection of better seasonal demand and tight cost discipline. We understand that the demand from Customer X has stayed stable notwithstanding the market turbulence stemming from the US tariff policy. As this should underpin the immediate-term earnings prospects, hence we expect Q1’26 sales to remain robust. Meanwhile, two new production lines started in Dec 2024 and SKP is ramping up the efficiency level to reach optimal output volumes. In addition, it is eyeing to secure more orders from one of the new customers – potentially doubling the job value to RM200 million pa. BUY with RM1.25 TP. – RHB Research, June 3

Q1’25 earnings were mainly driven by ongoing projects. Its manufacturing segment’s (plastics and gloves) operating loss narrowed to RM1.34 million (vs -RM3.84 million in Q4’24). Moving forward, the company will start marketing its in-house R&D glove product called Kinoko, which features better sweat absorption and moisturising effects (it expects to obtain US Food & Drug Administration or USFDA approval on this soon), which should help to drive sales volumes in 2H’25. Q1’25 property sales amounted to RM606 million vs RM560 million in Q4’24. MSGB’s 5M’25 sales have already hit RM1.01 billion, mainly driven by a few successful launches, including the maiden launch of M Legasi in Semenyih, M Nova in Kepong, as well as M Tiara and Meridin East in Iskandar Malaysia. These projects achieved >90% take-up rates. For FY25, it has lined RM3.3bn in new projects to be rolled out, while 5M’25 launches already reached RM1.18 billion. For the remaining months, new phases in M Legasi, Meridin East, Tiara 2 & Tiara Hills, and M Grand Minori will enter the market – so it should be able to hit its RM2.65bn sales target by end-2025. The collaborative agreement for the first 17.55-acre plot with Bridge Data Centre (BDC) lapsed on May 30, MSGB turned down BDC’s request for an extension. Meanwhile, the second collaborative agreement for the 35.68-acre site (200MW capacity) is still in effect, and set to expire on Oct 28. As the exclusivity period for the first plot is now over, management indicated that the company can start marketing the land to interested data centre off-takers and operators again. BUY with RM1.83 TP. – RHB Research, June 3

SYSTEM loans grew 5.1% YoY (flat MoM) in Apr 2025. Loans to the household segment continue to lead the charge, expanding by 5.9% YoY (flat MoM). This increase was led by loans for cars (+7.2% YoY) and mortgages (+6.5% YoY). Business loans grew at a more modest 4% YoY (-1% MoM) compared with +4.3 YoY in March (vs Dec 2024: +4.8%). Nevertheless, the segments recording higher loan growth included the finance (+15.5% YoY) and transport (+10% Yo Y) sectors. On an annualised basis, system loan growth was at a muted 3.1%. As such, we trim our system loan growth target for 2025, to 4.5-5% from 5%. In contrast to system loans growth, loan applications are up 7% YTD, mainly thanks to the business segment, while loan approvals are up 5% YTD. Loan disbursements, however, lagged behind with a 1% decrease YTD, which could indicate a step-up in disbursements later down the line. System deposits grew 3.8% YoY (flat MoM) in April 2025. CASA growth (+4.5% YoY) continued to outpace the pick-up in fixed deposits (+2.5% YoY). This led to a higher CASA ratio of 31.2% YoY (Apr 2024: 30.8%). LDR remained high at 87.4%, but marked a slight decline from the recent high of 88.1% in Jan 2025, while the liquidity coverage ratio remained healthy at 155.8%. System GILs declined by 8% YoY (+1% MoM), with improvements recorded across most segments, except for the finance (+3% YoY) and utilities (+23% YoY) sectors. The system GIL ratio dropped to 1.43% (April 2024: 1.63%, Dec 2024: 1.44%) alongside broader declines in both the household and business GILs. Similarly, LLC has declined to 91% (April 2024: 91.8%, Dec 2024: 92%). – RHB Research, June 3