05/08/2025

BIZ & FINANCE TUESDAY | AUG 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

AmBank grants RM222.8m financing for industrial park KUALA LUMPUR: AmBank Group, through AmBank Islamic Bhd, has provided RM222.8 million in financing to Suling Hill Development Sdn Bhd to support the development of the Northern TechValley @ Butterworth-Kulim Expressway (BKE), a green-inspired, 71.06ha integrated industrial park in Seberang Perai Tengah, Penang. Suling Hill Development is 50:50 joint-venture between Northern Industrial Park Sdn Bhd, a wholly-owned subsidiary of AME Elite Consortium Bhd and Majestic Gen Sdn Bhd. In a joint statement, AmBank Group said the project is designed as a next-generation integrated industrial ecosystem, projected to have a gross development value of approximately RM1.3 billion. Ambank Group managing director of business banking Christopher Yap said this financing reflects the bank’s commitment to support Malaysia’s industrial and economic growth. Meanwhile, Suling Hill Development director Dylan Tan said this joint-venture is a significant milestone for AME as the group strategically expands its presence into the northern region. “Northern TechValley @ BKE extends AME’s proven expertise in developing and managing sustainable industrial parks to Penang. The project will deliver a future-ready ecosystem that meets modern industrial demands and supports the growth of both local and multinational businesses,” he said. The project’s prime location situated along the BKE, further enhanced by a proposed flyover link bridge developed by Suling Hill Development, provides direct access and offers seamless connectivity to Penang and Kedah. This makes it an ideal hub for high-value-added industries, including advanced manufacturing. – Bernama

Ringgit firmer against dollar on weak US jobs report THE ringgit closed stronger against the US dollar yesterday following a softer-than-expected US jobs report that significantly altered market expectations on Federal Reserve policy, said an analyst. At 6pm, the local note rose to 4.2350/2385 versus the US dollar from Friday’s close of 4.2750/2815. SPI Asset Management managing director Stephen Innes said that last Friday’s nonfarm payrolls data showed a marked slowdown in US job creation, prompting traders to sharply increase bets on monetary easing. “Market-implied expectations for Fed rate cuts this year jumped to 64 basis points, up from 33 basis points prior to the release. The probability of a September rate cut surged above 90 per cent, while October is now fully priced for the first move.” Innes said the shift triggered a widespread sell-off in the US dollar and US government bonds, boosting demand for emerging market currencies including the ringgit, as sentiment pivoted towards a more dovish Fed outlook. Meanwhile, Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the ringgit is likely to exhibit a positive trend as Bank Negara Malaysia is expected to maintain its current overnight policy rate (OPR) stance. “This would mean that the interest differentials between the Fed Fund Rate and the OPR would narrow in the months to come.” At the close, the ringgit fell against the yen to 2.8652/8677 from 2.8407/8452 at the close on Friday, depreciated versus the pound to 5.6296/6342 from 5.6208/6293, and declined against the euro to 4.8978/9018 from 4.8752/8826 previously. The ringgit improved against the Singapore dollar to 3.2878/2908 from 3.2907/2960. – Bernama

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

1 US Dollar

4.3025 2.8010 3.3380 3.1170 4.9830 2.5530 3.3410 5.7170 5.3760

4.1675 2.6890 3.2410 3.0340 4.8230 2.4590 3.2370 5.5370 5.1480 3.3550 57.7000 62.9900 52.6000 4.7000 0.0246 2.8200 39.6200 1.4400 7.1400 113.2100 110.0000 22.3200 1.3500 41.8100 12.2700 112.3000 N/A

4.1575 2.6730 3.2330 3.0220 4.8030 2.4430 3.2290 5.5170 5.1330

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

118.4200 3.5880 60.2300 68.4400 55.3400 5.0100 0.0271 2.9140 15.5000 43.0600 1.5400 7.5800 119.2600 115.8700 24.7100 1.4600 45.9000 13.8300

112.1000 3.1550 57.7000 62.7900 52.4000

4.5000 0.0196 2.8100

N/A

39.4200 1.2400 6.9400 113.0100 109.8000 22.1200 1.1500 41.6100 11.8700

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

Ranhill Utilities Bhd Buy. Target price: RM1.70

Axis REIT Buy. Target price: RM2.23

Inari Amertron Bhd Buy. Target price: RM2.45

AUG 4, 2025: RM1.35

AUG 4, 2025: RM2.06

AUG 4, 2025: RM1.99

Source: Bloomberg, RHB Research

Source: Bloomberg, RHB Research

Source: Bloomberg, RHB Research

INARI (25.5%) and Sanan Optoelectronics (Sanan, 74.5%) will jointly acquire 100% of Netherlands-based company Lumileds for a total enterprise value of US$239m (RM1.03bn). We are neutral on this development over the short term, but positive over the medium term as this will enable INRI to diversify its revenue stream, boost its exposure to key growth areas, ramp up vertical integration, expand manufacturing capabilities, and improve ROE through strategic cash deployment. Lumileds is among the top original equipment manufacturers for aftermarket automotive lighting and accessories, camera flashes for mobile devices, MicroLEDs, and light sources for general illumination, horticulture, and human-centric lighting. The acquisition includes its 11 subsidiaries across Asia and Europe. In FY24 and 1Q25, it recorded revenue of US$589m and US$141m, with net losses of US$67m and US$17m. It has a share capital of US$468m. Sanan is a compound semiconductor player engaged in R&D and manufacturing of sapphire substrates, epitaxy, chips, and devices. It serves markets in LED and integrated circuits or ICs in microwave radio frequencies (RF), optical communication and power electronics segments. It is listed on the Shanghai Stock Exchange, and recorded an annual revenue of CNY16.1bn (FY24) and a market cap of CNY60bn. The acquisition gives INRI the potential to become the preferred OSAT vendor for Lumileds/Sanan under the China Plus One strategy. It also opens captive business opportunities over the longer term, leveraging Sanan’s expertise in advanced packaging, SiC, GaN, and LED technologies. Keep BUY and RM2.45 TP. – RHB Research, Aug 4

RANHILL Utilities’ subsidiary, Ranhill SAJ (RSAJ, 80%-owned) announced a set of new water tariffs effective 1 Aug for all types of users, including a new tariff category for data centres (DCs). The adjustment is necessary to replace ageing pipes, expand capacity, and support water treatment plant projects such as Layang 2 Phase 2 (160 million litres per day (MLD)), Semanggar (50 MLD) and Semanggar 3 (120 MLD). Based on details furnished by RSAJ, the upward revision in water tariffs for Johor ranges RM0.20-0.35/cu m, reflecting a 8 11% increase for residential bands 3 and domestic bulk meters. Meanwhile, tariffs for non-domestic users rose by 3-51%, with the non-domestic band 2 users seeing the highest increase of 51% to RM5.30/cu m, from RM3.50/cu m. New tariffs for DCs are slightly higher than non-domestic band 2 users, at RM5.33/cu m (Figure 1). This is still lower than Singapore’s non-domestic industrial water prices of SGD1.75/cu m or RM5.80/ cu m (including waterborne tax of SGD1.09). Post-tariff hike, we estimate the new blended water tariff in FY26F (Jun) to be RM2.88/cu m from RM2.56/cu m (a 13% increase) for an 11-month period, since the new tariffs took effect on 1 Aug. Nonetheless, we expect the blended water tariff rise at a higher quantum of 20% YoY to RM3.14/cu m in FY27, from RM2.62/cu m prior to the tariff hike. As a result, our earnings estimates for FY26 and FY27 are increased by 15.3% and 23.4%. We also revise our water consumption growth assumption for RSAJ to 4% (from 3.5%) from FY30 onwards, as we envisage robust demand from completed DCs and the Johor-Singapore Special Economic Zone. Maintain BUY, TP rises to RM1.70. – RHB Research, Aug 4

AXIS REIT has entered into a conditional sale and purchase agreement to acquire a logistics warehouse in Port Klang for RM80m. We remain positive on the stock - it is a proxy to the resilient and growing industrial property segment. With ample debt headroom, a more favourable interest rate environment, and a solid track record in executing yield-accretive acquisitions, we believe this REIT is well positioned to continue expanding its industrial portfolio. AXRB is acquiring the property from TS Worldwide Warehousing for RM80m, which will be fully funded via borrowings. This will raise the REIT’s gearing to 34.3% , from 32.7% in 2Q25 - which still puts it comfortably below the 50% threshold, with an estimated debt headroom of RM823m post acquisition. The transaction is expected to be completed by 4Q26. Built in 2014, the asset comprises a single-storey detached warehouse with an annexed double-storey office and a 1.5-storey detached warehouse, offering a total NLA of 259k sq ft. It sits on a leasehold industrial land parcel of approximately 10.2 acres. Strategically located in Telok Gong, Port Klang, the site benefits from excellent connectivity via the Pulau Indah Highway, Shah Alam Expressway (KESAS), and the West Coast Expressway. The property is fully leased to Tuck Sun Logistics (occupancy: 100%) on a 6-year term (3+3 years) at a monthly rental of RM425.8k. We are mildly positive on the acquisition. While relatively small in scale (1.5% of AXRB’s total assets), the acquisition supports the REIT’s ongoing strategy of delivering consistent inorganic growth. The purchase price implies a decent gross yield of 6.4% - which is reasonable, since the asset is fully leased under a 6-year term. Still BUY and RM2.23 TP. – RHB Research, Aug 4