05/05/2026

BIZ & FINANCE TUESDAY | MAY 5, 2026

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

S&P: Iran war to shape M’sia manufacturing performance KUALA LUMPUR: Malaysia’s manufacturing sector performance in the coming months will be partly shaped by how the situation in West Asia unfolds. The latest data shows that manufacturers are already taking steps to mitigate some of the impacts, said S&P Global Market Intelligence economist Maryam Baluch. In a note on the S&P Global Malaysia Manufacturing Purchasing Managers’ Index (PMI) for April 2026, she said data showed that manufacturing production rose for the second consecutive month in April, with the rate of growth the strongest since December 2021. The expansion was attributed to strategic stockpiling by both manufacturers and their clients, as the war in West Asia contributed to material shortages and rising prices. Baluch said that stockpiling efforts boosted production, partly directed towards building inventories of finished goods. Firms have also reported that their clients had a similar rationale, resulting in renewed growth in new orders in April. “Efforts by customers to build safety stocks were registered even as output price inflation hit a record high in April. “As firms looked to protect themselves against intensifying price pressures, purchasing activity increased as firms sought to raise their stocks of pre-production items,” she said. However, she noted that with supply-chain disruptions widespread, firms continued to see stocks of inputs decline. Higher energy and material costs due to the ongoing war have contributed to a marked increase in prices in April. In turn, charges were raised substantially, to the steepest rise in history. – Bernama Fraser & Neave Holdings Bhd Hold. Target price: RM33.60

THE ringgit strengthened against regional peers at the close as investors’ risk appetite improved, underpinned by growing confidence in safe passage through the Strait of Hormuz. At 6pm, the local currency also firmed to 3.9540/9575 against the US dollar from 3.9690/9740 at Thursday’s close. The local market was closed on May 1 for Labour Day. SPI Asset Management managing partner Stephen Innes said the US signal that it is preparing to safeguard energy hipments points to easing geopolitical tensions, giving risk assets room to recover. According to reports, President Donald Trump said the US would begin escorting neutral foreign vessels through the Strait of Hormuz this week, describing the move as a“humanitarian gesture” to protect countries caught in a conflict not of their making. He said the United States would use its “best efforts” to guide ships and crews through the restricted passage, adding that vessels would not return until conditions were safe for navigation. Meanwhile, Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said shipping executives remain cautious about the initiative, given limited details. “In addition, such an act could provoke Iranian forces, leading to further escalation with the US. “As such, traders are likely to watch Bank Negara Malaysia’s Monetary Policy Committee meeting, particularly its latest assessment of the Malaysian economy,” he told Bernama. At the close, the ringgit traded slipped against the Japanese yen to 2.5186/5210 from 2.4907/4942 at last Thursday’s close, depreciated versus the British pound to 5.3612/3660 from 5.3593/3661, but rose against the euro to 4.6329/6370 from 4.6417/6476 previously. Ringgit rises as risk appetite returns on Hormuz assurances

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

1 US Dollar

4.0330 2.9150 3.1600 2.9590 4.7200 2.3830 3.1600 5.4660 5.1800

3.8870 2.7970 3.0600 2.8760 4.5660 2.2950 3.0600 5.2920 4.9590

3.8770 2.7810 3.0520 2.8640 4.5460 2.2790 3.0520 5.2720 4.9440

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

110.7700

104.9700

104.7700 2.9080 59.3700 49.0600 3.8200 0.0165 2.4540 40.7100 1.1400 6.0600 105.6600 102.6800 22.4700 0.9500 40.7400 11.0600 N/A N/A

3.3510

3.1080

N/A

N/A

64.7500 51.8600 4.3300 0.0243 2.5830 44.4800 1.5000 6.6600 111.5100 108.3700 25.1000 1.3300 44.9600 12.9200 N/A

59.5700 49.2600 4.0200 0.0215 2.4640 40.9100 1.3400 6.2600 105.8600 102.8800 22.6700 1.1500 40.9400 11.4600 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

Coastal Contracts Bhd Buy. Target price: RM1.97

Johor Plantation Group Bhd Hold. Target price: RM1.92

May 4, 2026: RM30.02

May 4, 2026: RM1.86

May 4, 2026: RM1.14

Source: Bloomberg, TA Research

Source: Bloomberg, TA Research

COASTAL Contracts Bhd announced that it has secured a 90-day liftboat charter contract in the Middle East, with on-hire expected to commence by May 5, 2026. The contract is valued at approximately RM7.2 million, comprising a firm period of 40 days worth RM3.2 million and an optional extension of up to 50 days (structured as five 10-day options) valued at RM4 million. The contract is expected to contribute to earnings over the charter duration. We view this contract as mildly positive, as it supports fleet utilisation but with only marginal uplift to earnings. Management indicated that the contract was secured with a new charterer following the expiry of its previous contract in end-April, indicating successful redeployment with minimal downtime. Based on the disclosed contract value, the implied bareboat charter rate is approximately RM80,000/day, slightly lower than the roughly RM83,000/day achieved previously. However, this is partly mitigated by a longer charter period, which helps sustain overall revenue contribution. Overall, the contract win is in line with our FY26 utilisation assumptions. We maintain our forecasts unchanged, as the announcement is broadly in line with our expectations and does not materially alter earnings assumptions. We maintain our target price of RM1.97 per share based on sum-of-parts (SOP) valuation. Maintain Buy. – TA Research, May 4

F&N’S 2QFY26 results came in below expectations, with 1HFY26 core earnings of RM226.6mn accounting for 43% and 40% of ours and consensus’ full-year estimates, respectively. The shortfall was mainly due to weaker-than-expected sales and margins. 2QFY26 core profit declined 27.2% YoY to RM103.9mn, mainly due to weaker performance from F&B Indochina, higher operational costs from the dairy farming project during its pre-commercial stage, and a higher effective tax rate of 35.1%. Following the weaker 2Q results, 1HFY26 core earnings fell 23.7% YoY. An interim dividend of 30.0sen/share was declared, payable on 3 June 2026. Following revisions to our FY26–28 sales and margin assumptions, we lowered our FY26–28 earnings forecasts by 8.5%–9.4%. Due to ongoing geopolitical tensions, fertiliser, feed, packaging, and energy costs have trended higher, exerting near term margin pressure on the dairy farming project and overall operations, as evidenced by weaker margins in 2Q. However, we expect improving sales traction in 2H to partly mitigate overall cost pressures. Indochina’s sales performance should be supported by the normalisation of economic activity in Thailand, as well as the commencement of operations at its new dairy farm in Cambodia, which should help restore supply continuity. Following the earnings revision, we lowered our TP to RM33.60. We downgraded our recommendation from BUY to HOLD, as unresolved geopolitical tensions may continue to exert cost pressures and weigh on near-term profitability. – TA Research, May 4

Source: Bloomberg, Phillip Capital Research

WE remain positive on JPG’s medium-term prospects, underpinned by its transition from a pure upstream planter into a more integrated plantation player. While the group continues to benefit from resilient CPO prices and strong cost discipline, particularly on fertiliser, we see 2026E as a year of consolidation, with softer production and margin normalisation. Its Integrated Sustainable Oil Palm Complex (iSPOC) and biomethane initiatives are expected to progressively enhance downstream integration, improve value capture and broaden earnings streams. However, these growth drivers are largely back-end loaded, with more meaningful contributions likely to materialise from 2027E onwards. We forecast 2026E earnings to decline by 13% YoY to RM300m, reflecting weaker production in 1H26 and margin normalisation from a high base in 2025. FFB production is projected to remain broadly flat at 1.1m MT, weighed by weather disruptions, aggressive replanting activities and lagged biological effects. That said, production is expected to gradually recover from 2H26, consistent with seasonal trends. To mitigate lower internal crop, management has stepped up external FFB purchases to sustain mill utilisation, though this comes with slightly lower margins. We raise our 2026-28E EPS forecasts by 10-26%, factoring in higher CPO price and production assumptions, as well as lower operating cost assumptions. Key risks include production volatility, palm product price swings, cost inflation, regulatory uncertainties, geopolitical risk and broader macroeconomic uncertainties. Maintain HOLD with higher TP at RM1.92. – Phillip Capital Research, May 4