30/09/2024

BIZ & FINANCE MONDAY | SEP 30, 2024 Bursa likely to rebound this

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Citaglobal partners German firm on WTE technology

(TENAGA), notably call warrants MYEG-C6O and MYEG-C7D, and TENAGA-C2M and TENAGA-C2N. MYEG shares fell 4.8% w-o-w to RM0.900, losing all their gains in the previous week, while TENAGA shares rose a slight 0.1% w-o-w to RM14.66. To view the full list of structured warrants available on Bursa Malaysia, kindly visit malaysiawarrants.com.my . Provided for Malaysian residents information only. This commentary has not been reviewed by the Securities Commission Malaysia. It is not an offer or recommendation to trade and is not research material. Past performance is not indicative of future performance. You should make your own assessment and seek professional advice. The Warrants will not be offered to any US persons. week from rallies in China and US KUALA LUMPUR: Bursa Malaysia is expected to stage a rebound this week, driven by spillover effects from the robust rallies in both China and the US markets. UOB Kay Hian Wealth Advisors head of investment research Mohd Sedek Jantan said continuous foreign fund inflows, fueled by expectations of further rate cuts, combined with a strengthening ringgit, could bolster support for the FBM KLCI. “However, it is critical to recognise that market sentiment remains susceptible to external shocks and domestic developments. “Therefore, we anticipate the benchmark index to trade within the 1,660 to 1,680 range this week, highlighting the precarious nature of the current market environment,” he told Bernama. Mohd Sedek noted that the renewed optimism on China’s latest stimulus measures suggests a potential rebound in its economic activity, which is likely to drive demand for commodities, particularly in sectors such as oil and gas, plantation, and building materials. Moreover, China is set to release both the official and Caixin purchasing managers index (PMI) data today. He is projecting a recovery in the official manufacturing PMI, anticipating an increase to 49.3 from 49.1. This improvement could offer additional insights into the trajectory of China’s economic recovery moving forward. “In addition to these developments, we anticipate strong buying momentum on Wall Street, fueled by renewed confidence in the semiconductor and technology sectors, which is likely to positively influence local equities. “This is particularly relevant for the Bursa Malaysia technology index, which experienced losses in the previous trading week. Small-cap stocks, in particular, stand to gain from this improving sentiment,“ Mohd Sedek explained.

positions us strongly to secure contracts and explore strategic licensing collaborations with neighbouring countries, driving value for our stakeholders,” said Citiglobal executive chairman and president Tan Sri (Dr) Mohamad Norza Zakaria. “With our recent partnership with LAWI Germany, we are establishing a solid foundation in the waste management sector. Our vision is to grow this division into a key player in Southeast Asia, ultimately transforming it into a standalone, publicly listed entity within the next five years,” he added. Meanwhile, Dieter said that he looked forward to joining the Citaglobal family. “We are confident in what we bring to the table. Our track record, patents, and cutting edge technology put us in a very advantageous position to execute most WTE jobs. Together with Citaglobal, we believe our goal of reaching the next level is much closer to reality,” he added. Citaglobal Bhd’s current businesses include those of energy, telecommunications, civil engineering and construction, manufacturing and property development. The group is also a leading service provider in the oil & gas and related industries, serving a diverse range of clients that include multinational oil majors, national oil companies as well as multinational engineering and service providers. development and new growth corridors like Johor-Singapore Special Economic Zone. It would focus on spending on the digital economy and sustainable development initiatives related to energy transition and renewable energy. The stockbroking company also said the National Semiconductor Strategy, high-value added exports, and investments related to new technologies like artificial intelligence, cloud, and 5G would be included in Budget 2025. “It is expected to have measures to lower the cost of living and boost disposable income via civil servant salary increases, possible adjustment in minimum wages from RM1,500 to between RM1,700 and RM1,800, and increases in tax reliefs or rebates. “This will mitigate any negative impact from possible higher taxes on sugary food items,” it said. – Bernama

o Partnership will enable licensing of LAWI Germany’s products along with engineering services

KUALA LUMPUR: Citaglobal Bhd has entered into a binding term sheet with German Waste to-Energy (WTE) technology & engineering company LAWI Engineering GmbH (LAWI Germany) for exclusive discussions and collaboration to offer LAWI Germany’s technical and engineering solutions which consist of its patented combustion system, boiler engineering and design – LAWI EtaComb, LAWI EtaPlant and LAWI EtaLogic to waste management projects identified and targeted by Citaglobal and its affiliated entities. Founded in 1996, LAWI Germany is a technology and engineering player in the design and construction of high-efficient systems for the thermal utilisation of solid waste. The company is owned by sole shareholder and founder Dieter Langer, a German national. Its expertise lies in renewable power plant technology, particularly in WTE. LAWI Germany has completed more than 50 power plant projects with a 100% success rate over the last three decades in Southeast Asia, Korea, and Europe. The exclusive collaboration between

Citaglobal and LAWI Germany will enable the parties to monetise the licensing of LAWI Germany’s technology/products to potential partners, besides providing the usual suite of engineering services. Citaglobal has recently set up a new waste management division for waste management and related businesses of the group, which is a spin off from the collaboration between Citaglobal and Shanghai SUS Environment Co Ltd group (SUS). In mid-July this year, Citaglobal had entered into a joint development framework agreement with SUS Holding Ltd, an indirect wholly owned subsidiary of SUS, a China government-linked entity, to develop WTE projects in Pahang and biomass project in Malaysia. The exclusive collaboration and potential investment in LAWI Germany will be under this waste management division. “The opportunities in waste management and WTE are significant, particularly with a reputable technology partner like LAWI Germany at the core of our group’s waste management division. This collaboration

RM403.7 billion expected for Budget 2025: TA Securities KUALA LUMPUR: An allocation of RM403.7 billion is expected for Budget 2025, comprising RM305.7 billion and RM97.9 billion for operating and development expenditures, respectively, according to TA Securities Holdings Bhd. The rise in government revenue was due to a 4.2% and an 11.7% rise in direct and indirect taxes, respectively, as the economy continues to grow at a faster pace, businesses prosper and incomes rise.

In a report, it said stronger revenue growth versus spending would lead to a lower fiscal deficit of RM76.4 billion, or 3.7% in 2025, versus its forecast of 4.2% in 2024, and is on target to achieve the government’s 3.5% in 2026. “This will be supported by economic expansion, which we forecast to grow at a faster clip of 5% in 2025. “It would be driven by the services and manufacturing sectors, and supported by a stable labour market, wage increases, and private investments,” it said. TA Securities also predicted that government revenue will increase by 5.7% to RM325.3 billion in Budget 2025 versus RM307.6 billion in 2024.

“No new taxes are expected next year apart from the 15% global minimum tax and the already delayed high-value goods tax, besides enforcing phase-by-phase the e-invoicing implementation due to enter the final stage in 2025, and the broadening of the sales and services tax. “This would compensate for a possible lower dividend payout by Petronas due to the foregone revenue from its East Malaysia operations. Meanwhile, TA Securities anticipated that Budget 2025 would address key measures and potential beneficiaries in certain fields such as big-ticket public infrastructure projects like the mass rapid transit 3 and high-speed rail, equitable

WARRANTS WATCH Top 99SMART warrants by volume traded Warrant Volume Issuer Exercise Expiry date name (mil) price (RM) 99SMART-CB 207.5 Maybank 2.29 30 Apr 2025 99SMART-CE 77.5 Macquarie 2.58 30 Apr 2025 99SMART-CC 67.0 Kenanga 1.88 28 Jul 2025 99SMART-CA 34.7 Maybank 1.99 30 Apr 2025 99SMART-CD 33.8 Kenanga 2.18 28 Jul 2025 Structured warrants surge as HSI hits best weekly gain since 1998

week at 20,632.3, 13% higher w-o-w, notching its best weekly gain since 1998. The rally was boosted by positive sentiments following the unveiling of Chinese stimulus measures to boost the economy. Both the HSI call and put warrants were actively traded, namely call warrants HSI-CYN, HSI-CYG and HSI-CXI, and put warrants HSI-HW8, HSI-HWP and HSI-HWJ. Investors keen to gain leveraged exposure to the HSI without leaving the Bursa may consider structured warrants. Due to their gearing effect, these warrants have moved in larger percentages than the movements in the underlying HSI futures. For instance, with the HSI’s rise, call warrant HSI-CXI which tracks the movements in the underlying, saw its bid price more than triple w-o-w from RM0.250 to RM0.890. On the other

FOLLOWING the shorter trading week in the week of Sept 16, last week’s structured warrants market was a lot more active, with total turnover coming in at RM747.2 million for the week, 85.4% higher than the previous week and averaging at RM149.4 million traded per day. This is supported by the 153.4% boost in turnover for warrants over the Hang Seng Index (HSI), alongside smaller 20.5% and 9.6% increases in the turnover for Hong Kong and Malaysia stock warrants, respectively. Last week, the Hong Kong market continued its bullish run after gaining more than 5% week-on-week (w-o-w) in the previous week. Following a flat start on Monday, the index surged over four consecutive days to end the

hand, many put warrants over the HSI have declined in price, causing close to half of the HSI puts currently listed on Bursa to be priced below RM0.020. Back home, warrants over 99 Speed Mart (99SMART) remain actively traded. Following their 4.3% w-o-w rise in the previous week, 99SMART shares surged 10.2% w-o-w to close at RM2.16 last week, 30.9% above its initial public offering (IPO)

price of RM1.65. Top warrants over this name include 99SMART-CB, 99SMART-CC and 99SMART-CE. As noted last week, 99SMART-CE remains sold out; investors may consider other warrants over this underlying such as 99SMART-CF, which is currently on tight spreads. Meanwhile, investors continued to actively trade warrants over MY E.G. Services (MYEG) and Tenaga Nasional