20/08/2025

BIZ & FINANCE WEDNESDAY | AUG 20, 2025

/thesuntelegram FOLLOW / Malaysian Paper

ON TELEGRAM m RAM

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

Chin Hin partners HK-listed Kingdee on digital solutions KUALA LUMPUR: Building materials manufacturer and trader Chin Hin Group Bhd has entered into a strategic customer cooperation agreement with Hong Kong-listed Kingdee International Software Group Co Ltd for a shared digital transformation journey. The partnership with the digital management solutions provider aligns with Chin Hin Group’s broader regional vision to set the benchmark for the adoption of digital and artificial intelligence (AI)-driven enterprise solutions across Southeast Asia. In a statement yesterday, Chin Hin Group managing director Chiau Haw Choon said that with Kingdee as a strategic partner and its next-generation ecosystem platform as the foundation of the group’s enterprise resource management (ERM), it is ready to lead boldly into the GenAI era. Shenzhen, China-based Kingdee, with more than 30 years of expertise and a global customer base exceeding 7.4 million enterprises and organisations, has established itself as a pioneer in cloud-native enterprise management software. Meanwhile, Kingdee Group president Jason Zhang said it looks forward to combining Kingdee’s rapid development with Chin Hin Group’s operational excellence, and to jointly developing AI enabled capabilities in Kingdee Cosmic AI Service Cloud, making the project Kingdee’s overseas flagship reference. “The new platform will seamlessly integrate Chin Hin Group’s entire value chain – from building materials, construction engineering, to property development and home living – onto a single, reliable, and intelligent backbone of finance, procurement and supply chain that cohesively links with respective industry leading front-end operational modules,” the statement said. – Bernama

Ringgit holds firm against US dollar on trade rebound THE ringgit appreciated against major currencies and held firm versus the US dollar at the close yesterday as Malaysia posted a stronger trade performance, returning to positive growth in July. According to the Ministry of Investment, Trade and Industry (Miti), the country’s trade performance rebounded by 3.8% year-on-year to RM265.92 billion in July, the highest monthly trade value ever. At 6pm, the local note made a marginal retreat to 4.2215/2255 against the greenback from Tuesday’s close of 4.2200/2240. Miti said exports in July jumped 6.8% to RM140.45 billion, the highest monthly value since September 2022, while imports edged up by 0.6% to RM125.47 billion. Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the latest export print suggests Malaysia’s external sector is still “fairly decent” despite having to contend with US tariffs. “Hence, the case for a strong ringgit going forward remains intact,” he told Bernama. At the close, the ringgit settled mostly higher against a basket of major currencies. It strengthened versus the Japanese yen to 2.8572/8601 from Monday’s close of 2.8632/866, gained against the British pound to 5.7066/7120 from 5.7139/7193, but dropped vis-à-vis the euro to 4.9307/9354 from 4.9290/9336. The ringgit traded higher against other Asean currencies. It gained versus the Singapore dollar to 3.2901/2935 from 3.2902/2936 at Monday’s close and strengthened against the Thai baht to 12.9848/13.0027 from 12.9942/13.0121. The ringgit also gained vis-à-vis the Philippine peso to 7.39/7.40 from 7.40/7.42 previously and edged up against the Indonesian rupiah to 259.8/260.2 from 260.4/260.9.

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

1 US Dollar

4.2975 2.8050 3.3440 3.1100 5.0160 2.5550 3.3440 5.7980 5.3470

4.1605 2.6910 3.2410 3.0230 4.8520 2.4610 3.2410 5.6160 5.1190 3.3580 57.6000 63.3700 52.7000 4.6900 0.0249 2.8090 39.7200 1.4400 7.1900 113.0600 109.8100 22.7500 1.3500 42.1900 12.2200 112.1100 N/A

4.1505 2.6750 3.2330 3.0110 4.8320 2.4450 3.2330 5.5960 5.1040

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

118.2800 3.6070 60.1600 68.8800 55.4800 5.0000 0.0275 2.9140 15.3000 43.1900 1.5400 7.6500 119.1000 115.6800 25.1900 1.4600 46.3300 13.7900

111.9100

3.1580

N/A

63.1700 52.5000 4.4900 0.0199 2.7990 39.5200 1.2400 6.9900 112.8600 109.6100 22.5500 1.1500 41.9900 11.8200 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

Press Metal Aluminium Holdings Bhd Buy. Target price: RM6.26

99 Speed Mart Retail Holdings Bhd Buy. Target price: RM2.81

Ranhill Utilities Bhd Buy. Target price: RM1.70

AUG 19, 2025: RM1.40

AUG 19, 2025: RM5.61

AUG 19, 2025: RM2.45

Source: Bloomberg

FOR Q6’25 (or Q2’25), the PAT for the water segment increased by 34% YoY vs Q2’24 due to higher water revenue from subsidiary Ranhill SAJ, if the government grant is considered to have been offset against higher lease rental in relation to Operating Period 5. Meanwhile, the consultancy and services segment recorded a net loss of RM31.7 million for Q6’25 (Q2’24: net loss of RM6.8 million) due to cost overruns related to certain projects. The power segment booked a net loss of RM3.9 million in Q6’25 vs a RM22.9 million PAT in Q2’24 – this was due to maintenance and finance costs related to Ranhill Sabah Energy I and Ranhill Sabah Energy II, which offset the energy payment revenue and finance income from both power plants. We envision Johor’s water demand to be strong in the coming years, backed by industrial investments like DCs and manufacturing plants that could be part of the Johor Bahru Singapore Special Economic Zone. According to DC Byte’s Market Spotlight Report released in July, Johor has a live DC IT capacity of 487MW. Meanwhile, DCs with 324MW are now under construction, followed by another 1,473MW that is committed capacity. We envisage 300MW in additional DC capacity coming online annually over the next six years. A catalyst for RAHH could be the National Non-Revenue Water Programme, which could be implemented over 2025-2030, with a RM2.5 billion allocation. RAHH may benefit from this via its subsidiary Ranhill Technologies (under the consultancy and services arm), which has clinched water projects beyond Johor – namely the RM61.5 million job to replace old pipes in Kelantan covering a total length of 103km, which was secured in March 2022. BUY with RM1.70 TP. – RHB Research, Aug 19

Source: Bloomberg

Source: Bloomberg

WE expect core PAT to grow QoQ to RM480-520 million, albeit below our estimates – mainly driven by the alumina price easing to US$350/tonne (-34% QoQ). This takes its alumina-to aluminium cost ratio to 14%, below the 3-year historical average of 18%. However, this may be offset by the lower Q2’25 LME price of US$2,446/tonne (-7% QoQ) and Main Japanese Port or MJP premium of US$127/tonne (-38% QoQ). YoY, we expect to see somewhat mixed earnings (-6% to +2% YoY), as lower alumina costs (-19% YoY) would be offset by softer LME (-3% YoY) and higher carbon anode prices (+28% YoY). While the recent 90-day delay in the US tariff escalation against China does not directly impact PMAH, it should alleviate near-term downside risks to China’s economy and industrial demand. Since China consumes 55-60% of the world’s aluminium, the delay should lend support to LME prices moving forward. Note: PMAH’s exposure to the US affected just 3% of its FY24 revenue. The tariff delay may result in a stronger RM, which is a slight negative, in our view, as over 90% of PMAH products are exported. Based on our sensitivity analysis, a 2% appreciation in the RM could lower earnings by an estimated 5%, assuming no hedging is done. For the rest of 2025, we expect aluminium prices to be relatively stable, supported by subsiding geopolitical uncertainties. BUY with RM6.26 TP. – RHB Research, Aug 19

99 Speed Mart Retail Holdings’ 1H’25 results outperformed expectations on stronger-than-expected profit margin. Net profit of RM296 million (+15% YoY) accounted for 51% of our and consensus full-year estimates. That said, we anticipate a stronger earnings momentum in 2H’25 in view of the robust margin and extension of operation hours effective July, which has received encouraging response. Post results, we raise FY25-27 earnings by 3%, 3%, and 2%. Correspondingly, our DCF-derived TP rises to RM2.81 (including a 0% ESG premium/discount) after we roll over the valuation base year. This implies 36x FY26F P/E which is in line with the valuation ascribed to large-cap consumer staple counters under our coverage. YoY, 1H’25 revenue grew 10% to RM5.3 billion, underpinned by 248 net new stores and SSSG of +3.7%. 99SMART recorded increased transaction volumes on the back of a pick-up in consumer purchasing power post the minimum wage hike. Meanwhile, other operating income surged 14% YoY to RM430 million, suggesting stronger bargaining power in tandem with its robust network expansion. Correspondingly, net profit jumped 15% to RM296 million. QoQ, Q2’25 revenue and net profit grew 4% and 7% respectively supported by continuous new store additions (+61 outlets) and higher other operating income (+10%). 99SMART is well-positioned to benefit from the rising disposable income of the lower income groups as well as the downtrading consumption trends as a result of elevated inflationary pressures. BUY with RM2.81 TP. – RHB Research, Aug 19