MY Morning Wrap | Sime Darby Property's Q1 Net Profit Doubles on Record High Revenue

Moomoo News MY joined discussion · May 23, 2024 08:39

Good morning mooers! Here are things you need to know about today's market:

●US Stocks Close Lower on Fed's 'No-Rush' Approach to Rate Cuts, Nvidia's Bullish Sales Forecast

●Bursa Malaysia Nears Bull Market Phase as Investors Continue to Buy Blue Chips

●Malaysia's Commercial Vehicle Industry on the Rise: A Recap of the Malaysia Commercial Vehicle Expo 2024

●Stocks to watch: Sime Darby Property, Sunway

-moomoo News MY

MY Morning Wrap | Sime Darby Property's Q1 Net Profit Doubles on Record High Revenue

Wall Street Summary

US Stocks Close Lower on Fed's 'No-Rush' Approach to Rate Cuts, Nvidia's Bullish Sales Forecast

On Wednesday, US stocks closed lower after the latest Federal Reserve minutes suggested a 'no-rush' approach to rate cuts this year. The tech-heavy $Nasdaq Composite Index (.IXIC.US)$ fell 0.18%, while the $Dow Jones Industrial Average (.DJI.US)$ closed 0.51% lower, and the $S&P 500 Index (.SPX.US)$ was down 0.27%. However, after the market closed, Nvidia gave a bullish sales forecast, which could potentially boost tech stocks in the coming days.

Breaking News

Bursa Malaysia Nears Bull Market Phase as Investors Continue to Buy Blue Chips

Bursa Malaysia is edging closer to a bull market phase, supported by a sustained inflow of foreign funds and investments by local investors. Despite the old adage of "sell in May and go away," major indices such as the Dow and Nasdaq are at historic highs. The benchmark FBM KLCI rose 100 points in a little over a month to close at 1,622 points, underpinned by persistent accumulation of blue chips. Many analysts believe buying interest can sustain as most of the blue chips are still reasonably valued, with the broader index within the 15 times price earnings (PE) multiple, lower than its historical range of 16 to 16.5 times. Investors are closely watching the first quarter of financial year 2024 earnings reporting period for further leads to take fresh positions, particularly in sectors like technology, industrial production, consumer, and logistics, where lacklustre 1Q24 earnings are expected due to seasonality impact. The underlying economic outlook for Malaysia is also brighter, with macroeconomic indicators improving and moderating inflationary pressures in the US seeing global investors buy into emerging markets like Bursa Malaysia.

Malaysia's Commercial Vehicle Industry on the Rise: A Recap of the Malaysia Commercial Vehicle Expo 2024

The commercial vehicle industry in Malaysia is growing in importance and dynamism as the country's logistics infrastructure improves, freight volumes increase, and e-commerce experiences structural growth. This trend was reflected in the recent Malaysia Commercial Vehicle Expo (MCVE) 2024, which saw a turnout of about 4,000 visitors exploring the latest range of commercial trucks, buses, services, and components. The expo also provided relevant government agencies, professional societies, and associations with the opportunity to conduct seminars and provide updates on their products and services, enriching the event. MCVE 2024 played a pivotal role in steering the future of innovative transport solutions, with several brands utilizing the event to launch new vehicles and services. The expo also highlighted environmentally friendly technologies, including electric and hybrid vehicles, underlining the industry's shift toward sustainable practices.

Stocks to Watch

$SIMEPROP (5288.MY)$: Sime Darby Property Bhd (KL:SIMEPROP) has reported that its net profit for the first quarter ended March 31, 2024, has doubled year-on-year, as the property developer saw its quarterly revenue hit a record high on higher sales and successful project executions. The group's net profit for 1QFY2024 jumped 103.7% to RM123.58 million from RM60.67 million in 1QFY2023, while revenue rose 42.81% to RM978.69 million from RM685.33 million. The strong performance was attributed to higher sales from existing projects, the launch of new projects, and successful project executions. Sime Darby Property has also noted that it expects the property market to remain resilient, supported by low-interest rates and the government's various initiatives to stimulate the sector's growth.

$SUNWAY (5211.MY)$: Sunway Bhd (KL:SUNWAY) has reported a 21.6% year-on-year increase in its net profit for the first quarter ended March 31, 2024, driven mainly by stronger performance from the property development and healthcare segments. The conglomerate's net profit for 1QFY2024 rose to RM172.23 million or 2.27 sen per share, up from RM141.64 million or 1.98 sen per share a year ago, fuelled by higher sales and progress billings from new and ongoing local development projects. Quarterly revenue grew 12.28% to RM1.42 billion from RM1.26 billion in 1QFY2023. Sunway Bhd attributed the strong performance to higher contributions from its property development, healthcare, and quarry segments. The company also noted that it is optimistic about its outlook for the rest of the year, given the positive developments in the domestic economy and the potential easing of pandemic-related restrictions.

$PETDAG (5681.MY)$: Petronas Dagangan Bhd (KL:PETDAG) has reported a 25% year-on-year decline in its net profit for the first quarter ended March 31, 2024, due mainly to higher product cost and operating expenditure. The company's net profit for 1QFY2024 fell to RM226.04 million from RM301.84 million in the same period last year. However, revenue for the quarter rose to RM9.39 billion from RM8.65 billion a year earlier. PetDag has declared an interim dividend of 18 sen per share, amounting to RM178.82 million for the latest quarter. The company noted that it expects the fuel retail market to remain challenging due to the ongoing pandemic and the volatility of global oil prices.

$AFFIN (5185.MY)$: Affin Bank Bhd (KL:AFFIN), the financial services arm of the Armed Forces Fund Board (LTAT), has reported a 26% year-on-year decline in its net profit for the first quarter ended March 31, 2024, due to lower net interest income and other income. The bank's net profit for 1QFY2024 stood at RM110.21 million, compared with RM148.98 million a year earlier. Net interest income fell 6.6% year-on-year to RM361.98 million, while non-interest income surged 34% to RM142.56 million. Affin Bank attributed the decline in net interest income to lower lending volumes and the decline in interest rates, while the increase in non-interest income was driven by higher fee income from its wealth management and bancassurance services. The bank also noted that it remains cautious about the outlook for the rest of the year, given the ongoing challenges posed by the pandemic.

$KOSSAN (7153.MY)$: Kossan Rubber Industries Bhd (KL:KOSSAN) has posted its third consecutive quarter of profits in the first quarter ended March 31, 2024, thanks to higher sales volume and lower natural gas prices. The company's net profit for 1QFY2024 was RM31.45 million, compared to a net loss of RM24.25 million in 1QFY2023. Revenue for the quarter climbed 14.4% year-on-year to RM451.63 million from RM394.71 million. Kossan Rubber attributed the positive performance to higher sales volume in its gloves division, which was driven by increased demand due to the ongoing pandemic. The company also benefited from lower natural gas prices, which helped to reduce production costs. Kossan Rubber noted that it expects demand for gloves to remain strong, given the ongoing need for personal protective equipment amid the pandemic.

$HONGSENG (0041.MY)$: Hong Seng Consolidated Bhd (KL:HONGSENG) has revived its plan to expand its glove business with an alternate, albeit smaller, site for a synthetic rubber manufacturing plant in Kedah Rubber City. The diversified group's prior sublease for a 102.6-acre industrial land for 60 years for RM44.69 million is to be mutually terminated, subject to the group subleasing an alternate land measuring 10.42 acres from the Northern Corridor Implementation Authority (NCIA) for 60 years for RM4.59 million. Hong Seng had previously suspended its plan to expand its glove business due to delays in obtaining the necessary approvals from the government. However, after talks with the NCIA, the company is now looking to proceed with its expansion plans. The company noted that it believes the demand for gloves will remain strong, given the ongoing pandemic, and that it is optimistic about the outlook for the glove industry.

$BIMB (5258.MY)$: Bank Islam Malaysia Bhd (KL:BIMB), the country's largest full-fledged Islamic bank, has reported a 9.4% year-on-year increase in its net profit for the first quarter ended March 31, 2024, mainly driven by higher net fund-based income and lower net allowances for impairment on financing. The bank's net profit for 1QFY2024 stood at RM129.17 million, or 5.70 sen per share, compared with RM118.09 million, or 5.33 sen per share, a year ago, as quarterly revenue inched up 3.7% to RM1.14 billion from RM1.10 billion previously. Bank Islam Malaysia attributed the positive performance to higher financing and deposit volumes, as well as lower impairment allowances. The bank also noted that it remains optimistic about the outlook for the rest of the year, given the gradual recovery of the domestic economy and the ongoing support provided by the government and regulatory authorities.

$HIBISCS (5199.MY)$: Hibiscus Petroleum Bhd (KL:HIBISCS) has reported a 42.37% year-on-year increase in its net profit for the third quarter ended March 31, 2024, driven by strong oil and condensate prices of over US$90 (RM421.68) per barrel. The company's net profit for 3QFY2024 climbed to RM101.81 million from RM71.51 million a year ago, while revenue jumped more than 15% year-on-year to RM603.5 million from RM523.34 million. For the quarter under review, the company declared a dividend of two sen per share, payable on July 19, raising the total dividend for the nine months ended March 31, 2024 (9MFY2024) to six sen per share. Hibiscus Petroleum noted that it continues to focus on maintaining production levels and reducing costs, in order to maximize its profitability and cash flow. The company also highlighted its ongoing efforts to expand its portfolio of assets, both in Malaysia and abroad.

$LBS (5789.MY)$: LBS Bina Group Bhd (KL:LBS) has reported a marginal 0.11% year-on-year increase in its net profit for the first quarter ended March 31, 2024, helped by increased contribution from its property development business. The company's net profit for 1QFY2024 rose to RM30.53 million from RM30.5 million a year earlier, while quarterly revenue was down 11.11% to RM342.09 million from RM384.86 million in 1QFY2023, amid lower contributions from both the property development, construction and trading segments. The latest quarterly revenue is the group's lowest since 3QFY2021, when it posted RM253.96 million. LBS Bina Group attributed the decline in revenue to the impact of the ongoing pandemic on its operations, as well as the delay in the launch of new projects. The company noted that it remains cautiously optimistic about the outlook for the rest of the year, given the ongoing challenges posed by the pandemic and the uncertain economic environment.

Source: Dow Jones Newswires, Bursa Malaysia, The Malaysian Reserve, The Star, The EDGE

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