28/08/2025

BIZ & FINANCE THURSDAY | AUG 28, 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

AWC posts record FY25 revenue, RM25m net profit SUBANG JAYA: Main market-listed engineering services group AWC Bhd yesterday announced its fourth quarter (Q4’25) and full year financial results for the period ended June 30, 2025 (FY25). For the financial year under review, the group registered a revenue of RM414.1 million, an increase of 3.8% year-over-year (YoY) from RM398.8 million. This was owing to higher order fulfilment and project deliverables within the rail division. AWC’s profit after tax, zakat and non-controlling interest (net profit) jumped 26.1% YoY to RM24.9 million, up from RM19.7 million in the previous year. The larger-than-proportionate growth was chiefly attributed to the full year consolidation of the environment division’s earnings. FY24 net profit included a reversal of impairment on contract assets amounting RM3.2 million. The group remains focus on the execution of the projects in hand while seizing the exciting opportunities ahead. As of June 30, 2025, their total outstanding order book stands at RM597 million, which provides them healthy earnings visibility for the coming years. For the current quarter under review, the group recorded revenue of RM104.4 million, an increase of 2.4% YoY from RM102 million in Q4’24. However, the improvement was not reflected at the bottom-line due to unfavourable sales mix. Q4’25 net profit stood at RM6.7 million vis-à-vis RM7 million last year. On dividends, the group has proposed a dividend of 0.5 sen per share, bringing total dividends for FY25 to 1.25 sen per share. This translates to a dividend payout ratio of 16.4% based on FY25 earnings per share of 7.6 sen.

Ringgit weakens ahead of US inflation data release THE ringgit extended its loss to end lower against the greenback yesterday ahead of key US inflation data. The US Personal Consumption Expenditures (PCE) inflation print will be released this Friday, which could surprise on the upside, said an analyst. At 6pm, the local note slid to 4.2335/2365 versus the US dollar from Tuesday’s close of 4.2160/2210. Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said that if the US inflation data this Friday surprised on the upside, it might compromise the possibility of an interest rate cut in September. “Hence, that could contribute to the strength of the US dollar,” he told Bernama. Additionally, he said inflation could be elevated in the US as it has doubled tariffs on many imports from India to 50%. Mohd Afzanizam noted that the US Dollar Index (DXY) was higher by 0.38% to 98.603 points despite concerns over the independence of the US Federal Reserve. At the close, the ringgit settled mostly lower against a basket of major currencies. It rose versus the euro to 4.9058/9093 from 4.9087/9145 at Tuesday’s close, but fell vis-à-vis the Japanese yen to 2.8591/8611 from 2.8571/8607, and weakened against the British pound to 5.6890/6930 from 5.6827/6895. It also traded mostly lower against other Asean currencies. The local note weakened versus the Singapore dollar to 3.2843/2869 from 3.2786/2828 on Tuesday, declined against the Thai baht to 13.0330/0474 from 12.9707/9917, and slid against the Philippine peso to 7.40/7.41 from 7.38/7.40 previously.

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

1 US Dollar

4.2830 2.7950 3.3300 3.0930 4.9860 2.5160 3.3300 5.7740 5.3580 3.5700 60.2300 68.4800 55.5000 4.9600 0.0272 2.9120 43.3600 1.5400 7.6300 118.6800 115.3000 25.1500 1.4500 46.1900 13.7900 117.8600 N/A

4.1470 2.6820 3.2260 3.0070 4.8250 2.4230 3.2260 5.5910 5.1320 3.3470 57.6700 63.0100 52.7400 4.6600 0.0246 2.8070 39.8900 1.4400 7.1800 112.6600 109.4600 22.7100 1.3400 42.0200 12.2200 111.7500 N/A

4.1370 2.6660 3.2180 2.9950 4.8050 2.4070 3.2180 5.5710 5.1170

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

111.5500

3.1470

N/A

62.8100 52.5400 4.4600 0.0196 2.7970 39.6900 1.2400 6.9800 112.4600 109.2600 22.5100 1.1400 41.8200 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

Malayan Banking Bhd Buy. Target price: RM10.90

UOA Development Bhd Buy. Target price: RM2.08

Leong Hup International Bhd Buy. Target price: RM0.98

Aug 27, 2025: RM9.79

Aug 27, 2025: RM1.76

Aug 27, 2025: RM0.615

Source: Bloomberg

Source: Bloomberg

Source: Bloomberg

WHILE UOAD’s revenue continued to be driven by existing projects (Bamboo Hills, Aster Hill, the medical centre in Bangsar South and remaining units at Laurel Residence), the sequential growth in earnings was largely attributed to the cost savings recognised. These stemmed from the completion of Laurel Residence early this year. As a result, EBIT margin widened to 75% for the quarter, from 53% in Q1’25. Net cash stood at RM1.91 billion. Property sales eased in 2Q25 to RM148 million, compared with RM265 million in Q1’25. Of its total 1H’25 sales of RM413 million, Bamboo Hills Residences contributed RM267.3 million, followed by Laurel Residence (RM53.6 million), Aster Hill (RM42.1 million), and Duo Tower (RM39.9 million). The take-up rate for Bamboo Hills (Blocks A, B and C) now stands at 59% (Block C was launched in April), while sales at Aster Hill improved slightly to 69% from 67% in the previous quarter. UOAD plans to launch its maiden project in JB, once it obtains the advertising permit and developer’s licence (APDL) – hopefully by the year-end. This project is very near to the Rapid Transit system or RTS station, and the company plans to build a link bridge that connects to the transport terminal. We understand that UOAD has already started the preview for this project, and buyer interest has been quite encouraging. The indicative ASP of RM1,200-1,250 psf is very much in line with the current market rates for new high-rise projects in the vicinity. Meanwhile, UOA Business Park Phase 2 office (GDV: RM130 million) will be launched this year, but this will be an investment property (to be rented out before the en bloc sale). BUY with RM2.08 TP. – RHB Research, Aug 27

Q2’25 results were in line with net profit of RM2.6 billion (+2% QoQ, +4% YoY) bringing 1H’25 earnings to RM5.2 billion (+4% YoY) – at 50% of our and consensus FY25F PATMI. 1H’25 reported ROE of 11.5% is tracking well MAY’s Ż 11.3% target (FY24: 11.1%), while group and bank CET-1 ratios stayed solid at 14.7% and 13.5%. An interim cash DPS of 30 sen (Q2’24: 29 sen) was declared, translating to a payout ratio of 69.5% (1H’24: 70%). QoQ PATMI growth was led by higher associate contribution and a lower tax rate, as operating income was flat while Q2’25 YoY earnings growth was underpinned by stronger non-II thanks to treasury activities and insurance. Q2 NIM fell 4bps QoQ (-6bps YoY) mainly due to Singapore (lower benchmark rate) and, to a lesser extent, Indonesia, while Malaysia NIM improved. Loan growth was muted (flat QoQ; +1% YoY) due to its overseas book, with Indonesia trimming its SOE exposure due to thin NIMs, as well as the derisking of its Greater China corporate portfolio, and FX impact. Domestic loans rose 7% YoY (+1% QoQ) thanks to community financial services. Deposits rose 6% YoY (+1% QoQ) on healthy CASA expansion and hence, the overall balance sheet looks liquid with the reported LDR at 90%. GIL ticked up 2% QoQ (+3% YoY) with the QoQ rise from judgemental triggers for its commercial segment and a Hong Kong corporate account classified as impaired. By purpose, auto and mortgage GILs were higher, cushioned by lower GILs from construction and others. Due to the muted loan growth, Q2’25 credit cost was under control at 25bps. This was despite the addition of RM200 million in management overlays, bringing its overlay stock to RM2 billion. BUY with RM10.90 TP. – RHB Research, Aug 27

YOY, 1H’25 revenue declined by 9% to RM4.3 billion, mainly due to a 17% drop in feedmill sales in reflection of lower commodity prices. In addition, the Indonesian market saw a decline of 16% due to challenging market conditions there, which led to lower ASPs. Meanwhile, 1H’25 EBITDA eased 4% YoY to RM518 million as the robust growth in Malaysia, Vietnam and the Philippines markets were offset by the plunge in the Indonesia segment’s contribution (-67%). QoQ, Q2’25 revenue and EBITDA fell 4% and 1% from the underwhelming Indonesia segment’s performance, as demand slowed down post Lebaran. Essentially, we believe LHIB’s earnings and margins should normalise from the exceptional FY24 base, which was aided by the sharp depreciation of the USD and low ETR. This is considering the lower tax credits moving forward, on top of the cyclical and volatile nature of the poultry industry, particularly in Indonesia. That said, we believe the overall fundamental of the poultry industry has improved, with the pandemic and commodity supercycles phasing out the smaller and weaker players. This has led to an industry consolidation, which is favourable for large industry players like LHIB. This, on top of its sturdier balance sheet (net gearing fell to 0.43x in Q2’25 from 1.1x in FY22), leads us to believe that LHIB is well-positioned to capture more market share and improve on its efficiency level via capacity expansion. BUY with RM0.98 TP. – RHB Research, Aug 27