05/06/2025

BIZ & FINANCE THURSDAY | JUNE 5, 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

Ringgit eases against greenback after stronger US economic data THE ringgit eased against the greenback at the close yesterday after the US posted stronger economic data. At 6pm, the local note edged lower to 4.2435/2490 versus the US dollar from Tuesday’s close of 4.2425/2485. Bank Muamalat Malaysia Bhd’s chief economist, Dr. Mohd Afzanizam Abdul Rashid, said stronger-than-expected US job openings in April lifted optimism about the American economy’s resilience and helped lift the dollar. US job openings rose 191,000 to 7.391 million by the last day of April, beating a forecast of 7.1 million vacancies. “The US Institute for Supply Management (ISM) Index for the services sector is expected to rise to 52 points in May from 51.6 points in April based on consensus estimates. Having said that, the US Dollar Index (DXY) continues to hover below 100 points. Currently, the DXY index is lingering around 99.145 points, down 0.08% from the previous close,” he told Bernama. At the close, the ringgit traded mostly higher against a basket of major currencies. It rose against the Japanese yen to 2.9444/9486 from Tuesday’s close of 2.9695/9739, gained vis-à-vis the euro to 4.8300/8362 from 4.8415/8484, but depreciated against the British pound to 5.7427/7502 from 5.7337/7418 previously. The local note also traded mostly higher against its Asean peers. It appreciated against the Singapore dollar to 3.2906/2951 from 3.2967/3016 on Tuesday, advanced versus the Thai baht to 12.9679/9911 from 13.0334/0603 and edged higher vis-a vis the Philippine peso to 7.60/7.62 from 7.61/7.63.

Oasis Harvest to buy Chef Wan’s dining brands for RM30.8m KUALA LUMPUR: Bursa Malaysia-listed food and beverage (F&B) player Oasis Harvest Corporation Bhd has proposed to acquire the entire stake in Metta Food & Lifestyle Sdn Bhd for RM30.8 million. The acquisition will enhance Oasis’ presence in the domestic F&B sector with renowned dining brands such as De.Wan 1958 by Chef Wan and Cafe Chef Wan. Metta, through its establishments, is known for banquet themed dining experiences and cafes that capture diverse culinary tastes. This strategic acquisition enables Oasis to broaden its culinary offerings, benefiting from Metta’s market recognition, operational expertise, and the prestigious reputation of international celebrity chef Datuk Redzuawan Ismail, famously known as Chef Wan. Commenting on the acquisition, Oasis executive director Ch’ng Eu Vern said this acquisition perfectly aligns with the company’s strategic vision to diversify and strengthen offerings in the F&B, travel, leisure, and hospitality sectors. “Chef Wan’s prominent brands will significantly complement and expand our existing portfolio,” he said in a statement. The acquisition includes a profit guarantee from the vendors, ensuring Metta achieves a cumulative audited net profit of at least RM5.6 million over two years ending June 30, 2026, reflecting strong confidence in the long-term growth and profitability of the enlarged group. Post-acquisition, Oasis intends to streamline Metta’s operations with existing brands such as Uncle Don’s and Verona Trattoria. Leveraging Metta’s central kitchen will enhance operational efficiency, cost management, and consistent food quality across the company’s establishments.

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

1 US Dollar

4.3195 2.8050 3.3450 3.1440 4.9190 2.6000 3.3450 5.8480 5.2800 3.6060 60.4600 67.6100 55.6100 5.1200 0.0274 3.0040 43.6800 1.5500 7.8700 119.6900 116.3100 25.0500 1.4800 46.3000 13.8200 118.9200 N/A

4.1815 2.6890 3.2460 3.0560 4.7560 2.5020 3.2460 5.6560 5.0510 3.3550 57.8500 62.1500 52.7900 4.8000 0.0248 2.9050 40.1400 1.4500 7.4000 113.6200 110.4200 22.6200 1.3600 42.1300 12.2400 112.6400 N/A

4.1715 2.6730 3.2380 3.0440 4.7360 2.4860 3.2380 5.6360 5.0360

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

112.4400

3.1550

N/A

61.9500 52.5900 4.6000 0.0198 2.8950 39.9400 1.2500 7.2000 113.4200 110.2200 22.4200 1.1600 41.9300 11.8400 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

Padini Holdings Bhd Buy. Target price: RM2.85

QL Resources Bhd Hold. Target price: RM4.25

CapitaLand Malaysia Trust Buy. Target price: RM0.76

June 4, 2025: RM2.09

June 4, 2025: RM4.37

June 4, 2025: RM0.635

Source: Maybank Investment Bank

Source: Maybank Investment Bank

Source: Maybank Investment Bank

QLG indicated that capacity expansion plans within its MPM segment is on track. The relevant approvals from the local government are still in the process of being obtained for the expansion of its surimi processing plant in Hutan Melintang, Perak (currently operating at full capacity), while its Indonesia surimi processing plant (PT Hasil Laut) has gradually grown utilisation to 30% as at end-Q4’25. Into FY26, we believe that MPM’s PBT margins should remain steady at 17%, similar to FY25’s 17.4%. Export sales accounted for 20% of MPM sales. Recall that the egg subsidies in Malaysia will be removed from Aug 1 onwards (subsidies were halved to 5sen/egg, effective May 1). Post-subsidy removal, we believe that Grade C egg ASPs may increase by 3sen to 4sen/egg – short of the 10sen/egg subsidy amount, due to a relatively balanced egg industry supply at present. That said, QLG is planning to grow its higher margin ‘branded’ egg sales in order to cushion the negative margin impact on ILF in the near-term. We understand that 20% of QLG’s egg sales are in the ‘branded’ category, which were not subjected to price controls. The total egg subsidy payments in FY25 amounted to RM139 million. In terms of its palm oil business, QLG still owns 400 acres of palm oil land and one CPO mill in Tawau, Sabah. Given that management has already found a suitable buyer for its palm oil land, we believe that its palm oil business divestment could be fully completed by end-FY26. Elsewhere, QLG’s CVS contribution may remain lacklustre in FY26 as weak consumer sentiment drags sales whilst higher store operating costs suppress PBT margins. HOLD with RM4.25 TP. – Maybank Investment Bank, June 4

AT PAD’S Q3’25 results briefing, management shared that SSSG grew +6% YoY (9M’25: +1% YoY) on the back of higher festive driven sales volume from CNY and Hari Raya Aidilfitri. Gross profit margins also lifted to 41% (Q3’24: 35%) predominantly due to product mix improvements where sales from higher active-wear and new IP-related products aided margins. We understand that the positive impact from the appreciation in RM vs CNY is likely to materialise in subsequent quarters (Q4’25 and beyond) given that the group is still in the process of running down its higher cost of inventory - where PAD typically keeps c.4 to 6 months of inventory. Recall that >50% of PAD’s products are sourced from China with just 11% sourced locally. With this, we are comforted that favourable FX movements could buffer any adverse earnings impact expected in a seasonally weak sales quarter in Q4’25. We make no change to our earnings estimates. PAD is well positioned to benefit from both consumer down-trading trends or increases in consumer disposable income due to its mass market appeal and low price point products. In the event that the US-China trade war escalates, we believe that PAD may also stand to gain from better negotiating power with its suppliers in China. There are several risk factors for our earnings estimates, target price and rating for PAD. Changes in sales volume, selling prices and operating expenses may lead to lower earnings for PAD. Increasing competition and weak consumer sentiment are additional earnings risk factors. BUY with RM2.85 TP. – Maybank Investment Bank, June 4

CLMT has proposed a private placement of up to 435.4m new units to raise RM250 million. The proposed placement includes potential allotments to key unitholders holding >5% and >10% of CLMT shares that will require approvals to comply with listing requirements. An EGM date will be announced soon. The RM250 million placement proceeds will be used to repay part of its borrowings (RM246.1 million) and placement related expenses (RM3.9 million). The exercise is expected to complete by Q3’25. CLMT’s net gearing is expected to rise to 44.1% post asset acquisitions based on existing borrowings (Q1’25 net gearing: 41%). Post placement, its net gearing is expected to reduce to 39.6%. Proceeds from the placement will partly refinance borrowings for ~RM400 million of completed and pending logistics/industrial acquisitions, including Glenmarie Distribution Centre (retrofitting completed Jan 2025), and upcoming assets in Elmina Business Park, Nusajaya Tech Park and Senai Airport City, to complete in 2H’25. These are expected to contribute ~RM20 million in gross rental income annually (~4% of FY26 revenue). Post-acquisition, CLMT’s industrial and logistics exposure will rise from 2.8% to 7.9% of assets under management, expected to contribute 9% of FY26 NPI. We expect its retail assets to remain resilient with mid to high single digit range rental reversion and steady occupancy for its ex-Klang Valley malls. Despite short-term dilution, longer-term earnings visibility, diversification and improved gearing, support our positive view. BUY with RM0.76 TP. – Maybank Investment Bank, June 4