15/07/2025

BIZ & FINANCE TUESDAY | JULY 15, 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

Capital A, KTMB to explore integrated travel and logistics KUALA LUMPUR: Capital A Bhd has entered into a MoU with Keretapi Tanah Melayu Bhd (KTMB) to explore strategic cooperation in areas including travel services, logistics, food and beverage, and loyalty programmes. In a filing with Bursa Malaysia, Capital A said the MoU was signed on July 13 and outlines a non-binding framework for collaboration between the two parties. “The MoU sets out the understanding between the company and KTMB to jointly undertake detailed feasibility studies to ascertain the commercial and operational viability of the potential areas of co-operation which are of mutual benefit to both parties,” Capital A said. It said that by leveraging KTMB’s rail network alongside Capital A’s assets including Teleport logistics, Santan F&B, AirAsia Move and AirAsia Rewards, the collaboration is expected to enable seamless multimodal travel, enhance cargo efficiency and improve the overall passenger experience. “Key initiatives under the partnership include potential bundled flight-train bookings, last-mile shuttle services to Senai Airport, cargo network integration between Teleport and KTMB Kargo, as well as in-train catering by Santan. “Passengers will also benefit from a loyalty points exchange between Rail Points and AirAsia Rewards, with BigPay being considered as a preferred payment platform,” it said. The company said that the MoU will not have any effect on share capital, earnings, net assets or gearing of Capital A group. – Bernama

Ringgit and regional peers end softer against US dollar THE ringgit closed easier against the US dollar yesterday, tracking the performance of its regional peers, as market sentiment remained extremely guarded while the foreign exchange market navigated a period of economic uncertainties. At 6pm, the local note weakened to 4.2505/2560 against the greenback from last Friday’s close of 4.2475/2525. Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the ringgit initially appreciated against the US dollar in the morning session to RM4.2455 but later stabilised at around RM4.25 in the afternoon. “Asian currencies were also generally weak against the US dollar. The US tariffs continue to hog the limelight as the Donald Trump administration maintained its hawkish stance towards the European Union and Mexico with 30% tariffs.” At the close, the ringgit was traded mostly higher against a basket of major currencies. It strengthened against the British pound to 5.7305/7379 from 5.7524/7592, improved against the Japanese yen to 2.8858/8897 from 2.8893/8929 but traded marginally lower versus the euro to 4.9693/9757 from 4.9679/9737. The local note also trended mostly higher against Asean currencies. The ringgit traded slightly higher vis-à-vis the Singapore dollar at 3.3184/3229 from 3.3186/3228, improved against the Indonesian rupiah to 261.5/262.0 from 261.8/262.3 previously, and strengthened versus the Philippine peso at 7.50/7.51 from 7.52/7.53. But, it dropped against the Thai baht to 13.1213/1439 from 13.0668/0886 from Friday’s close. – Bernama

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

1 US Dollar

4.1840 2.7420 3.2720 3.0660 4.8880 2.5080 3.2720 5.6490 5.2250 3.4040 58.0400 63.8500 52.7900 4.8000 0.0249 2.8450 40.2100 1.4500 7.3100 113.6600 110.4500 22.5300 1.3600 42.3800 12.3500 112.7000 N/A

4.1740 2.7260 3.2640 3.0540 4.8680 2.4920 3.2640 5.6290 5.2100

4.580 2.941 3.444 3.179 5.060 2.777 3.444 5.931 5.465

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

112.5000

118.5500

3.2040

N/ N/ N/

N/A

63.6500 52.5900 4.6000 0.0199 2.8350 40.0100 1.2500 7.1100 113.4600 110.2500 22.3300 1.1600 42.1800 11.9500 N/A

55.680

N/

0.030 3.150 14.870 44.610 2.430 7.7700 115.410 33.290 N/

100 Qatar Riyal 100 Saudi Riyal

100 South Africa Rand 100 Sri Lanka Rupee 100 Swedish Krona

1.520

N/

100 Thai Baht

13.8400

Source: Malayan Banking Bhd/Bernama

Malaysian Economy Weak mining output drags IPI; Manufacturing remains key pillar

Syarikat Takaful Malaysia Keluarga Bhd Neutral. Target price: RM3.70

Econpile Holdings Bhd Buy. Target price: RM0.48

JULY 14, 2025: RM0.395

JULY 14, 2025: RM3.44

Source: Bloomberg

Source: Bloomberg, DOSM, TA Securities

ECONPILE Holdings announced its second job win for FY26 (June) and third win within a 2-week timeframe. ECON secured a RM98 million contract from Eastmont to undertake bored piling works for Blocks C and D, basement construction for Block C, and pile cap works for Block D within a proposed industrial development in Kapar, Klang. The is ECON’s largest contract win since Oct 2023. Given that the majority of ECON’s contracts pertain to property development works, the latest win indicates the group’s comeback in the industrial space. Said project is expected to be completed within 13 months from July. The last time ECON clinched a job related to an industrial building was in April 2022 – a RM23 million contract from CJ Synergy Solutions for a 5-storey industrial building in Section 20, Petaling Jaya. We estimate ECON’s latest outstanding orderbook at RM570 million, while FY26-YTD new job wins stand at RM125 million (note: It is only the first month of this FY) vs our full-year job win target of RM600 millionThe last time its outstanding orderbook stood above the RM500 million mark was in Q3’22 (or end Q1’22) at RM550 million. The group’s tenderbook stands at RM1 billion, comprising private and public sector jobs. Potential rerating catalysts include faster-than-expected approval for the Sungai Klang Link project (worth RM300-500 million for piling works). Profitability wise, we expect GP margins for this latest job to be between 5% and 8%. Downside risks: Slower-than-expected roll-out of mega infrastructure projects and volatile material prices. BUY with RM0.48 TP. – RHB Research, July 14

Source: Bloomberg

MALAYSIA’S Industrial Production Index (IPI) registered a marginal growth of 0.3% YoY in May 2025, easing from the 2.7% YoY expansion in the previous month and below market expectations of 2.1% YoY. The moderation was primarily driven by a sharper contraction in the Mining sector, alongside subdued growth in the manufacturing segment. Mining output continued to weaken amid lower crude oil and natural gas production, while manufacturing activity was dampened by softer demand from both export markets and domestic-oriented industries. On a MoM basis, the IPI, however, rose by 1.1% in May, reversing the 8% decrease recorded in April. The manufacturing component, which makes up a substantial 65.9% share of the IPI, increased at a softer rate of 2.8% YoY during the month (3.8% MoM). Despite the softer growth, the sector remained supported by continued expansion in both domestic- and export-oriented industries, albeit at a more measured pace. The manufacturing sector recorded a sales value growth of 2.4% YoY in May 2025, reaching RM158.7 billion. The growth in sales value within the manufacturing sector was mainly contributed by the food, beverages & tobacco sub-sector, sustained the strong expansion with a 13% increase in May 2025 (April 25: 10.8% YoY). Meanwhile, the mining sector decreased further by 10.2% YoY in May 2025, as compared with the 6.3% YoY decline recorded in the prior month. The contraction was primarily driven by a decrease in natural gas production growth, which declined by 16.6% YoY (April 25: -10% YoY). – TA Research, July 14

THE expanded sales & services tax (SST) now includes bancassurance and bancatakaful commissions, effective Sept 1. We think the impact could be material to Syarikat Takaful Malaysia Keluarga, given its strong bancatakaful franchise. Bancassurance commissions will be taxable at 8% (from 0%) under the expanded SST scope effective Sept 1 (Phase 2 implementation). The bancatakaful channel contributes to almost half of STMB’s gross contributions, and primarily drives its credit related takaful sales. While management has yet to provide official guidance on its expected earnings impact, we estimate the additional SST payable by STMB to amount at least RM20 million per annum on a full-year basis. This is on top of potential SST incurred on sales incentives fees and upfront fees for bancatakaful agreement renewals. Management thinks it has limited capacity to pass on the additional tax to its policyholders at this juncture, given the increased scrutiny on insurance and takaful premiums due to the ongoing medical premium inflation situation. While STMB will absorb the SST impact in the immediate term, the group thinks there is scope for potential repricing of new creditrelated takaful certificates further out – especially if public sentiment on insurers improves – though no timeline was provided. In the meantime, STMB, alongside other insurers and takaful operators, are in the midst of discussions with the Inland Revenue Board and Finance Ministry to negotiate down the new SST for bancassurance commissions and related expenses. NEUTRAL with RM3.70 TP. – RHB Research, July 14