18/07/2025

BIZ & FINANCE FRIDAY | JULY 18, 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

Penang LRT Mutiara Line’s consultant engineer named KUALA LUMPUR: Malaysia Rapid Transit Corporation Sdn Bhd (MRT Corp), formerly known as Mass Rapid Transit Corporation Sdn Bhd, has appointed MMSB Consult Sdn Bhd as the independent consultant engineer (ICE) for the Penang LRT Mutiara Line. The appointment was made through an open tender process, followed by a comprehensive evaluation. The scope of work includes a thorough review of the design, construction, testing, commissioning, operation and maintenance phases, ensuring adherence to all relevant project requirements, standards and regulations. This appointment reflects the Mutiara Line’s growing momentum as the project transitions from preparatory stages into construction readiness. Meanwhile, the Civil Main Contract Package 1, awarded to SRS Consortium Sdn Bhd (SRS) came into effect on June 23, following their fulfilment of key contractual conditions. Subsequently, SRS met several additional project implementation requirements, paving the way for the issuance of the Notice to Proceed (NTP) on July 15. With this issuance, work under Package 1 is set to accelerate. Before the issuance of the NTP, advanced activities were already underway including soil investigation, pile testing, pre-construction condition surveys, as well as instrumentation and environmental monitoring at selected locations along the alignment. The project remains on track for advance works to commence in August 2025, with key activities such as utility relocation, piling works, and site establishment. Looking ahead, large-scale civil construction is anticipated to commence in the fourth quarter of 2026. Tan Chong Motor Holdings Bhd Buy. Target price: RM1.12

Ringgit falls further on lingering US tariff uncertainty THE ringgit slipped further against the greenback yesterday on continued uncertainty about US tariffs. At 6pm, the local note dipped to 4.2465/2510 from 4.2400/2490 on Wednesday’s close. Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said market participants remained anxious about how US tariffs will impact the global economy. “US President Donald Trump has indicated that 150-plus countries will be notified about their respective tariff rates, which could be in the region of 10% to 15%. At the same time, Trump also denied news on the possible termination of the current US Federal Reserve (Fed) chairman Jerome Powell. Market participants remain anxious about how the US tariffs will (play out),” he told Bernama. At the close, the ringgit traded higher against a basket of major currencies. It was up versus the euro at 4.9217/9269 from 4.9248/9352 on Wednesday’s close but retreated against the British pound to 5.6886/6946 from 5.6786/6907 and declined against the Japanese yen to 2.8548/8580 from 2.8508/8569. The local note also trended mostly higher against Asean currencies. It inched up against the Indonesian rupiah to 259.8/260.2 from 260.3/260.9 and strengthened versus the Philippine peso to 7.41/7.43 from 7.43/7.45. The ringgit fell against the Thai baht to 13.0521/0720 from 13.0301/0630 and traded down vis-à-vis the Singapore dollar to 3.3013/3051 from 3.2999/3071. Market Strategy Stay cautious, accumulate at lower levels

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

1 US Dollar

4.3120 2.8250 3.3540 3.1430 5.0160 2.5700 3.3540 5.7830 5.4120 3.6200 60.4300 68.8900 55.4800 5.1000 0.0274 2.9110 43.1200 1.5400 7.6700 119.5100 116.1600 25.0300 1.4700 45.6900 13.8500 118.7100 N/A

4.1780 2.7110 3.2560 3.0580 4.8540 2.4750 3.2560 5.6000 5.1800 3.3820 57.8700 63.4000 52.7200 4.7900 0.0248 2.8180 39.6700 1.4400 7.2300 113.4600 110.2700 22.6000 1.3500 41.6100 12.2800 112.5500 N/A

4.1680 2.6950 3.2480 3.0460 4.8340 2.4590 3.2480 5.5800 5.1650

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

112.3500

3.1820

N/A

63.2000 52.5200 4.5900 0.0198 2.8080 39.4700 1.2400 7.0300 113.2600 110.0700 22.4000 1.1500 41.4100 11.8800 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

Gamuda Bhd Buy. Target price: RM5.86

JULY 17, 2025: RM5.15

JULY 17, 2025: RM0.76

Source: Bloomberg

Source: Bloomberg

ON July 10, TCM sold 3.2-acre plots along Jalan Putra to Avaland for RM148.8 million following the first land sale to Avaland in Petaling Jaya earlier this month for RM49 million. The total gain on disposal for these lands is expected to be between RM15 million and RM18 million with both deals transacted between RM518 psf and RM1,067 psf. Management said the plots sold were used for non-manufacturing purposes. According to its latest annual report, based on Top 10 largest properties, TCM owns c.14 acres of nonmanufacturing land (e.g. showrooms, storage, and service centres) across Selangor, Kuala Lumpur, and Johor – these were recently revalued in 2022. Assuming market values of RM250-1,050 psf, we estimate these lands could be worth RM220 million, roughly 40% of TCM’s market cap. More importantly, the group does not disclose its exhaustive list of assets. Hence, there may be other smaller properties that might not be used for its automotive business but are suitable for redevelopment, e.g. the recent land disposal was not included in the Top 10 largest properties, implying more assets to be potentially realised. TCM still retains its traditional automotive model of owing the distribution network, which includes showrooms/properties vis-à-vis the current agency distribution model. Given that Nissan’s market share has fallen from 6% of TIV in 2010 to 1% in 2024, there may be incentives for TCM to resize its business model by selling some of their showrooms. The group currently operates 50-60 branches, of which 20-30% are based in Kuala Lumpur. BUY with RM1.12 TP. – RHB Research, July 17

ON July 16, Gamuda together with the Perak State Development Corporation (PKNPk) – in a 50:50 JV – accepted a letter of appointment from the Perak state government for the development and operation of water treatment and distribution infrastructure in Kerian (northern Perak). Recall that in February, both parties initially signed an exclusive arrangement to develop infrastructure to address critical water shortage in northern Perak. The aforementioned infrastructure forms part of the broader Northern Perak Water Supply Scheme (NPWSS) which has an estimated total development value of RM5 billion, a strategic initiative by the Perak and federal governments to address long standing water shortages for irrigation, domestic, and industrial use in the region. Aside from the development and operation of water treatment and distribution infrastructure in Kerian, the JV will also undertake the supply of treated water to the Kerian Integrated Green Industrial Park (KIGIP) and the sale of excess treated water to Penang. These will be executed by the JV on a privatisation basis with a minimum 40-year operation period. GAM via the JV would be able to recognise 50% of the recurring income from NPWSS at the developer level. Additionally, the JV – which is the project owner of NPWSS – may appoint GAM as the turnkey contractor. This is not something new to GAM as the Ulu Padas Hydroelectric Project in Sabah includes the company as a developer (effective 45% stake in a JV with Sabah Energy Corporation and Kerjaya Kagum Hitech JV) and as the total development contractor. BUY with RM5.86 TP. – RHB Research, July 17

Source: RHB Research, Bloomberg

TRUMP-INDUCED risks to global trade and the ensuing impact on the US and global economies continues to roil investor sentiment, capping the upside for domestic equities. This comes on the back of second- and third-order effects of tariffs that could impact corporate earnings. The 2H’25 global macroeconomic outlook remains clouded by uncertainties. Trade and monetary policy decisions will be the main determinant of how the economic environment evolves. RHB Economics maintains its US GDP growth at 1.5% YoY for 2025, but with two (vs three previously) US Federal Reserve (US Fed) rate cuts. Its forecast for China’s GDP growth remains at 4.5%, with downside risks dragged by rising debt and a moderating property market. Meanwhile, Malaysia’s 2025 GDP growth projection has been lowered to 4.2% (from 4.5%), reflecting increased external risks and uncertainties. Local investors seeking comfort from US equity markets breaching record highs should have a reality check. We believe US financial markets are suffering from a disconnect with the real economy. The US’ new isolationist tendency, its high-risk domestic agenda (OBBB) and muddled foreign policy priorities centred around a China containment strategy will remain a persistent source of stress for emerging economies, even as the US attempts to compel Asean countries to pick a side. – RHB Research, July 17