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FBM KLCI 1745.00
2.99
KLCI FUTURES 1744.00
12.00
STI 3338.84
12.68
RM/USD 3.5620
CPO RM2367.00
24.00
OIL US$47.16
1.53
GOLD US$1248.50
PP 9974/08/2013 (032820)
PENINSULAR MALAYSIA RM1.50
FRIDAY JANUARY 16, 2015 ISSUE 1881/2015
FINANCIAL
DAILY
MAKE
BETTER
DECISIONS
www.theedgemarkets.com
IOI Properties’ Bandar Puteri
Bangi hits 70% sales
20 P R O P E RT Y
2
Europe in turmoil
5 HOME BUSINESS
Perodua eyes 6.3%
sales growth this year
5 HOME BUSINESS
Ekovest gets PM’s
Department’s nod
to privatise RM3.57b
Duke 3
6 HOME BUSINESS
Matrade: Next six
months crucial for
Malaysian trade
18 C O M M E N T
No more excuses
for Draghi
by
u
o
y
o
t
t
h
g
u
o
r
b
s
i
y
p
o
c
l
a
t
This digi
14.00
FBM KLCI 1745.00
2.99
KLCI FUTURES 1744.00
12.00
STI 3338.84
12.68
RM/USD 3.5620
CPO RM2367.00
24.00
OIL US$47.16
1.53
GOLD US$1248.50
PP 9974/08/2013 (032820)
PENINSULAR MALAYSIA RM1.50
FRIDAY JANUARY 16, 2015 ISSUE 1881/2015
FINANCIAL
DAILY
MAKE
BETTER
DECISIONS
2
Europe in turmoil
5 HOME BUSINESS
Perodua eyes 6.3%
5 HOME BUSINESS
Ekovest gets PM’s
Department’s nod
to privatise RM3.57b
Duke 3
6 HOME BUSINESS
Matrade: Next six
months crucial for
Malaysian trade
18 C O M M E N T
No more excuses
for Draghi
IOI Properties’ Bandar Puteri
20 P R O P E RT Y
14.00
2
FR I DAY JAN UARY 16 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
For breaking news updates go to
ON EDGE T V
Europe in turmoil
After SNB unexpectedly drops cap; Danes may be next
Following
aborted
three-way
bank merger,
analysts adjust
target price
Perodua
forecasts 6%
rise in car sales
this year
The Edge Communications Sdn Bhd
(266980-X)
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LONDON/ZURICH/COPENHAGEN: Global markets were thrown
into turmoil yesterday as a shock
move by Switzerland to abandon
its more than three-year-old cap on
the franc sent the currency soaring and Europe’s shares and bond
yields tumbling.
The Swiss franc jumped by almost 30% in a chaotic few minutes
after the 1.20 per euro cap in place
since late 2011 was lifted, surging
past parity to trade as high as 0.8052
francs per euro. It was trading at
1.02600 at just after 1200 GMT. The
move reversed an earlier rebound
in risk appetite following an overnight recovery in commodity prices.
Over 100 billion francs (RM359.53
billion) was wiped off the value of
Swiss stocks, their biggest daily fall
in 26 years, while the pan-European
FTSEurofirst 300 slumped 2% and
Wall Street futures turned negative.
As investors scrambled for traditional safe-haven assets, there were
new record low yields for Germany’s government bonds and gains
for the yen and gold.
“This is extremely violent and totally unexpected, the central bank
didn’t prepare the market for it,”
said Alexandre Baradez, chief market analyst at IG in France.
“It’s sparking panic across all asset
classes. It suddenly revives the risk
of central bank policy mistakes, right
when central bank action is what’s
keeping equity markets going.”
The view among traders was that
the Swiss central bank must have felt
it could no longer hold out against
the tide of money coming its way
as the European Central Bank prepares to start quantitative easing
and investors pour out of riskier
markets such as Russia. Adding to
the nervous mood, oil has also resumed its slide. Brent crude fell back
to US$47.50 as a rebound by copper
and other metals after their big falls
on Wednesday also started to wane.
The Swiss move, which also saw
interest rates cut deeper into negative territory, sent shockwaves far
and wide.
Swiss exporters including Swatch
Group AG and Richemont slumped
in Zurich trading after the central
bank’s decision to scrap its cap on
the currency.
“Today’s [yesterday] Swiss National Bank (SNB) action is a tsunami; for the export industry and for
tourism, and finally for the entire
country,” Swatch Group AG chief
executive officer Nick Hayek said
by e-mail. “Words fail me.”
Holcim, the world’s biggest cement
maker, slid as much as 21%. Watchmakers Cie, Financiere Richemont SA
and Swatch tumbled more than 9%.
The benchmark Swiss Market Index
dropped as much as 8%, the biggest
intra-day decline since October 2008.
A strong franc is a serious challenge for exporters like Swatch and
small- and mid-size companies
with factories in Switzerland, where
shop-floor workers earn some of
the highest wages in Europe. Timepieces make up more than a 10th of
the country’s total exports, led by
brands including Rolex, Swatch’s
Omega and Richemont’s Cartier.
The decision by the SNB to abandon its euro cap is fuelling speculation the Danish central bank may
come under pressure to follow suit,
according to Nordea Bank AB.
Reuters reported that the Swiss
central bank’s surprise move to let
the franc surge sent shock waves
through the banking sector in central and eastern Europe, where
widespread mortgages denominated in Swiss francs suddenly
became much harder to service.
Analysts said Poland and Hungary looked especially exposed to
the currency swing that could boost
bad loans and poses a policy headache for governments watching citizens’ purchasing power dwindle.
“The [SNB] decision, leading to
massive Swiss franc appreciation, is
extremely bad news for FX-borrowers in Central Europe, Poland and
Hungary in particular,” said Michal
Dybula, an economist at BNP Paribas in Warsaw. — Reuters/Bloomberg
Daim: I know those behind
media spotlight on me
KUALA LUMPUR: Tun Daim Zainuddin has revealed he knows those
behind the sudden spotlight on his
business empire as anti-graft officials investigate the former finance
minister’s banking business abroad.
Daim, in a statement yesterday,
said he was surprised that Umno-controlled Media Prima Bhd
would provide coverage for opposition party PKR.
“While I understand the motivation of these PKR politicians as
they know not much other than
politics and making baseless allegations, I am quite surprised with
the attention given to them by the
government-friendly media.
“TV3 which would not give two
minutes of air time to Pakatan, has
aired the PKR press conference
no less than three times. The NST
and Utusan have also carried this
news,” he said.
The Umno-controlled Media
Prima group runs four free-to-air
television stations and newspapers
in Bahasa Malaysia and English
editions. The group recently laid
off nearly 400 managers and executives in light of falling revenue
and profit. The group also controls
English language daily New Straits
Times (NST). The other Umno-run
media firm is Utusan Melayu Bhd.
Daim will cooperate with Malaysian anti-graft officials investigating
his banking business abroad, but said
pressure groups should not interfere.
In a statement to Bernama, Daim
said he was confident of the Malaysian Anti-Corruption Commission’s (MACC) capability to carry
out the probe.
“I stand ready to support and
cooperate with MACC in its investigation,” he said in the statement.
Daim was quoted by the news
report as saying that he had been
investigated on the matter twice
in 1999, and they found nothing.
Pro-Umno bloggers reported
that Daim had been attacked by
cybertroopers aligned to Prime
Minister Datuk Seri Najib Razak
for criticising Putrajaya’s handling
of the economy. Daim, along with
former prime minister Tun Dr Mahathir Mohamad, have emerged as
strong critics of Najib’s administration over his handling of the economy and national politics.
Veteran journalist Datuk A Kadir
Jasin warned a few days ago that
Media Prima should stop sniping at
Daim as it could backfire on Najib.
Najib was more vulnerable to
personal attacks than Daim and
other critics, Kadir, the retired
editor of the New Straits Times
Daim says he is surprised that Umnocontrolled Media Prima would provide
coverage for opposition party PKR. The
Malaysian Insider file photo
Press group, said in his blog.
Calls for the anti-graft authorities to investigate Daim, however,
have also been made by the opposition, with PKR’s Youth chief
Shamsul Iskandar Mohd Akin in
November last year highlighting the
lack of police action against the former minister despite the lodging of
a police report in 1999. Opposition
leader Datuk Seri Anwar Ibrahim
lodged that report 15 years ago, accusing Daim of amassing billions
of ringgit in African and Eastern
Europe banks through proxies. —
The Malaysian Insider
IN BRIEF
BlackRock’s quarterly
earnings up
NEW YORK: BlackRock Inc, the
world’s largest money manager, reported a higher than
expected fourth quarter profit
as assets under management
increased. Net income fell to
US$813 million (RM2.89 billion), or US$4.77 per share, from
US$841 million, or US$4.86 per
share, a year earlier. Excluding
a compensation programme associated with shareholder PNC
Financial Services Group Inc,
earnings were US$4.82 a share,
beating the analysts’ average
estimate of US$4.68, according
to Thomson Reuters I/B/E/S.
The New York-based company
ended the fourth quarter with
US$4.65 trillion in assets under
management, up 8% from a year
earlier. — Reuters
Opec to see market
share drop
LONDON: The collapse of oil
prices is starting to slow growth
in US output, the Organisation of
the Petroleum Producing Countires (Opec) said yesterday, although the slowdown will not
prevent demand for the group’s
oil falling in 2015 to its lowest in
a decade. In a report, Opec forecast demand for the group’s oil
will drop to 28.78 million barrels per day (bpd) in 2015, down
140,000 bpd from its previous
figure and the lowest since 2004.
Opec also trimmed the rate of
growth in non-Opec supply partly due to a slowdown in the US
shale boom. Opec lowered its
forecast of total US oil supply in
2015 by 100,000 bpd. — Reuters
‘Downgrades for oil
producers likely’
LONDON: There are likely to be
credit rating downgrades for oil
producing countries if the price
of crude doesn’t recover, rating
firm Fitch said yesterday. “If oil
prices fail to recover from current lows, it is likely that there
will be further ratings actions
on oil-producing countries,” Ed
Parker, one of Fitch’s top sovereign analysts said at a conference. “What would it take for us
to downgrade ...Russia? It would
really be more of the same — if
oil prices fail to recover from
current lows, if we see an even
deeper and longer recession
and we see more financial sector turmoil,” he said. — Reuters
HSBC could pass Lloyds
as biggest issuer of CoCos
LONDON: HSBC Holdings plc
will surpass Lloyds Banking
Group plc this year as Europe’s
biggest issuer of the riskiest bank
bonds, according to some of
region’s biggest debt investors.
HSBC will sell about US$4 billion
(RM14.24 billion) of additional
Tier-1 notes, a type of contingent
capital bond designed to absorb
losses, to bring its total to almost US$10 billion, said Laurent
Frings at Aberdeen Asset Management plc and Steve Hussey
at AllianceBernstein Holding LP.
Lloyds has about US$8.3 billion
of the CoCo bonds outstanding.
— Bloomberg
HOME BUSINESS 3
F R I DAY JA N UA RY 16 , 2015 • T HEED G E FINA NCIA L DA ILY
Market relief on aborted merger
Move to call off the exercise reflects prudence on CIMB’s part, says Fitch
BY SHA L I N I KU MA R
KUALA LUMPUR: The market responded positively yesterday to
news that discussions of the mega-merger between CIMB Group
Holdings Bhd, RHB Capital Bhd
(RHBCap) and Malaysian Building Society Bhd (MBSB) had been
called off on Wednesday.
A bank-backed analyst told The
Edge Financial Daily that while
most banking stocks saw gains, this
was most likely a spillover effect
from investors buying into CIMB’s
stock. But it remains to be seen if
this would be a rerating catalyst
for the sector.
Another analyst who declined
to be named said the rebound in
CIMB’s share price spoke for itself,
when asked if the news was positive. The banking group’s shares
rose 14.9% from a one-year low of
RM5.18 as at Jan 12, 2015.
CIMB (fundamental: 1.35; valuation: 2.1) was one of the most
actively traded stocks yesterday,
gaining 16 sen or 2.78% to close
at RM5.91 and RHBCap (funda-
mental: 1.5; valuation: 2.1) ended
at RM7.75, 1.31% or 10 sen higher,
while MBSB (fundamental: 1.2; valuation: 2.4) lost four sen or 1.85%
to close at RM2.12.
At the same time, Malayan Banking Bhd closed 2.5% or 21 sen higher at RM8.60, Hong Leong Financial Group Bhd gained four sen or
0.24% to close at RM16.58, while
BIMB Holdings Bhd rose one sen
or 0.26% to RM3.92.
In a statement yesterday, Fitch
Ratings said the move to call off
the exercise reflected prudence on
CIMB’s part, amid a “weakening
operating and economic environment resulting in slower growth
and banking sector asset quality
pressures”.
The ratings agency deemed the
merger as “ambitious”, as the process would have been lengthy and
the inclusion of MBSB into the mix
would have made the integration
even more challenging given its
different business mix to CIMB
and RHBCap.
Fitch noted that the macroeconomic outlook for Malaysia has
An analyst said the
rebound in CIMB’s
share price spoke for
itself, when asked if
the news was positive.
The Edge file photo
grown less certain amid the recent
sharp falls in the price of crude oil
as the country is a net oil exporter.
“MBSB’s focus on higher-risk
personal unsecured lending —
one of the areas most sensitive to
a weaker environment — would
have raised the risk profile of the
new entity had the merger gone
through, even though we believe
the Malaysian banks are well placed
to meet the challenges with strong
loss absorption buffers,” it added.
Affin Hwang Research analyst
Tan Ei Leen said she still sees provisioning risks for CIMB, due to
headwinds from Indonesia and
also for RHBCap due to a below
industry impaired loan cover.
She said now that the mega-merger has been called off, the
question remains as to whether
other banks would be interested
in a merger as well.
“We maintain our ‘neutral’ rating
on the Malaysian banking sector
given concerns of cascading macro
risks on the economy from 4Q14
(fourth quarter of 2014) to 2Q15,”
she said in a note.
Meanwhile, RAM Rating Services
Bhd has lifted the “positive” rating
watch on the RHB group’s banking
entities, MBSB and RHB-guaranteed debt issues.
“Concurrently, we have reinstated the stable outlook on their
ratings,” it said.
“The ‘positive’ rating outlook
on RHBCap’s debt facilities has
also been reinstated on account
of the anticipated improvement
in its gearing and double-leverage
ratios,” it added.
The Edge Research’s fundamental
score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers.
The valuation score determines if a
stock is attractively valued or not,
also based on historical numbers.
A score of 3 suggests strong fundamentals and attractive valuations.
Go to www.theedgemarkets.com for
more details on a company’s financial dashboard.
4 HOME BUSINESS
Moody’s: Lower tariffs possible
Power rates may go down to reflect lower fuel costs
KUALA LUMPUR: Moody’s expects
most private power producers in
the Asia-Pacific region, including
Malaysia, to lower their tariffs to
reflect lower fuel costs.
The rating agency said most
utilities in Australia, China, Hong
Kong, India, the Philippines, Malaysia and Singapore and private
power producers in Asia Pacific
might also maintain a minimal
reliance on oil or oil price-linked
natural gas.
Furthermore, low oil prices will
also reduce the cost of transporting coal.
In a note, Moody’s said its revised assumptions for Brent crude
average spot prices are lower to
US$55 (RM195.80) per barrel
through 2015, US$65 per barrel
in 2016 and US$75 in the medium term.
For the West Texas Intermediate (W TI) crude, it revised
downwards to US$52 per barrel
in 2015, US$62 per barrel in 2016
and US$75 in the medium term.
“State-owned power utilities
in Indonesia and South Korea,
on the other hand, rely more on
power generation fuelling from
oil or oil price-linked natural gas
than utilities in other parts of the
Asia-Pacific region.
“These utilities will have lower
input costs through at least 2015
and tariffs for end-users will likely remain largely intact,” it said.
Moody’s noted that regulators
would not likely reduce their tariffs as steeply as the drop in fuel
prices, allowing the utilities to
keep financing their high capital
spending programmes.
Another sector to benefit from
lower oil prices is aviation as passenger airlines’ financial performance would improve this year as
a result of lower fuel costs.
Conversely, suppliers of aircraft
and components could suffer as
falling prices increase the risk of
order cancellations and deferrals
down the supply chain.
Moody’s senior vice-president
Russell Solomon said oil prices
had fallen to a level that significantly reduced the operating cost
benefits airline customers would
realise from new fuel-efficient
aircraft compared to when orders
were placed, when Brent crude averaged more than US$80 a barrel.
Falling oil prices would be
modestly positive for automobile
makers as demand could potentially shift to larger, higher-margin vehicles such as sport utility
vehicles at the expense of smaller, more fuel-efficient models.
— Bernama
File pic of an oil and gas refinery in
Kemaman. Low oil prices will also
reduce the cost of transporting coal.
MOST VIEWED STORIES ON
theedgemarkets.com
SKP to rejoin SC syariah list
with US$2.3b Islamic loan
KUALA LUMPUR: SapuraKencana
Petroleum Bhd (SKP), through its
wholly-owned subsidiary SapuraKencana TMC Sdn Bhd (SKTMC),
signed a US$2.3 billion (RM8.2
billion) equivalent Islamic facility
agreement yesterday to convert a
portion of its existing conventional multi-currency facility (MCF)
borrowings into a facility based
on the syariah principle of Murabahah with 11 local, regional and
international banks.
The transaction represents the
largest Islamic facility in Malaysia
to date, according to a major bank
involved in the deal.
With the completion of this
transaction, SKP (fundamental:
1.3; valuation: 1.8) said it is now
on track to return to the Securities
Commission Malaysia’s (SC) list of
syariah-compliant securities by
meeting the debt over total assets
financial ratio benchmark.
“This is testament to SKP’s commitment to support Malaysia’s ongoing initiatives and efforts in positioning itself as an international
Islamic financial centre,” said SKP
president and group chief executive officer Tan Sri Shahril Shamsuddin.
“We have been working very
closely with our group of MCF
lenders and we are grateful for
the strong commitment and continued support from the lenders,
which have allowed us to accomplish another significant milestone”, he said.
The upstream oil and gas player
was removed from the SC’s syariah-compliant list on Nov 27 last
year. It was excluded from the list
as it did not meet one of the three
criteria, which requires that conventional debt not exceed two
thirds of a company’s total assets.
Subsequently, The Edge Finan-
cial Daily reported on Dec 1, quoting sources, that SKP planned to be
back on the list in the next review
by the SC in May this year.
“SKP’s borrowings have been
completely conventional debts as
Malaysian banks do not have large
enough US dollar Islamic products
or the limit to support SKP. This fact
has been explained to the SC by a
major lender,” a source reportedly
told the daily.
The daily also said then that the
group had been working with 14
banks and obtained approvals to
convert their required portions into
syariah-compliant debt to meet
the SC’s requirements.
The debt conversion, it reported
then, was expected to be completed before the end of its financial
year ending Jan 31, 2015.
SKP closed up five sen yesterday to RM2.44, giving it a market
capitalisation of RM14.62 billion.
Brahmal ceases to be SMRT substantial shareholder
tial shareholder of the firm on May
2, the stock closed at 33.5 sen. On
Jan 8, SMRT shares were trading at
65 sen apiece.
The counter closed 1.5 sen higher
at 64.5 sen yesterday, with a market
capitalisation of RM143.73 million.
BY KAMARUL ANWAR
KUALA LUMPUR: Brahmal Vasudevan (pic), who is the chief executive
officer and founder of private equity firm Creador Capital Group, has
ceased to be a substantial shareholder of SMRT Holdings Bhd after
selling 2.1 million shares on Jan 8
and 9, a filing with Bursa Malaysia
revealed yesterday.
Brahmal sold 1.8 million shares
in SMRT (fundamental: 1.5; valuation: 1.8) on Jan 8 and the rest on
the following day. As at Jan 8, he
held 11.6 million shares or a 5.08%
stake in SMRT.
Although SMRT’s counter has
vacillated in a wide range of 33 sen
and 75 sen since last May, Brahmal
could have made handsome gains
from the sale.
When he emerged as a substan-
Benalec rises 6.3% after Forest City
gets DoE approval
BY A H MA D N AQ IB ID R IS
KUALA LUMPUR: Shares in Benalec Holdings Bhd (fundamental: 1.65; valuation: 1.8) rose as
much as 6.25% yesterday, after
news of the controversial Forest
City project in Johor getting approval of its detailed environmental impact assessment (DEIA)
from the Department of Environment (DoE).
While the marine construction
services provider is not involved
in the Forest City project, it has
a reclamation project nearby,
covering 1,410ha at Tanjung Piai,
for the purpose of an industrial
oil and gas hub. The approval
granted to Forest City sparked
optimism about Benalec’s reclamation project in Tanjung Piai.
Benalec’s share price rose 2.5
sen or 3.91% to close at 66.5 sen
yesterday, with some 6.45 million
shares done. The counter earlier
gained as much as four sen or
6.25% to reach a high of 68 sen.
Country Garden Pacific View
Sdn Bhd (CGPV), the master developer of the Forest City project,
on Wednesday announced that
the DoE had accepted its proposed measures to mitigate environmental impacts through “integrated and workable solutions”.
CGPV’s shareholders include China’s Country Garden Holdings Co
Ltd, the sultan of Johor and the
Johor state government.
As recently as Jan 7, Benalec
said it had yet to receive the goahead from the DoE to start reclamation works for its Tanjung
Piai integrated petroleum and
petrochemical hub and maritime industrial park project. It
then clarified to Bursa Malaysia
that it had submitted the DEIA
report to the DoE in late October 2014, and was still awaiting
an official approval.
MISC calls off RM250m disposal
of logistics unit
BY C H E S T E R TAY
KUALA LUMPUR: MISC Bhd,
the shipping arm of Petroliam Nasional Bhd (Petronas), has called
off a RM250 million plan to dispose of its wholly-owned subsidiary MISC Integrated Logistics
Sdn Bhd (MILS).
In a filing with Bursa Malaysia
yesterday, MISC (fundamental:
1.6; valuation: 1.8) said the proposed disposal had been terminated as the buyer, Golden Age
Logistics Sdn Bhd (GAL) was not
able to fulfil its obligations for
completion as stipulated in the
agreement for the sale and purchase of shares dated March 21,
2014 between the two companies.
However, it did not specify
which condition was not fulfilled.
The conditions stated in the
agreement included approvals
from relevant regulatory authorities, letter of consent from MILS’
financiers or lenders, and letter
of confirmation from Petronas.
“Accordingly, MILS will remain as a wholly-owned subsidiary of MISC going forward,”
MISC said.
GAL is a wholly-owned subsidiary of Utusan Printcorp Sdn Bhd.
MISC’s share price retreated nine sen or 1.16% to close at
RM7.70 yesterday, on a trading
volume of 1.25 million shares,
bringing its market capitalisation
to RM34.77 billion.
HOME BUSINESS 5
Perodua eyes 6.3%
Driven by continued demand for its newly-launched models
BY SU L H I A ZMA N
KUALA LUMPUR: Perusahaan
Otomobil Kedua Sdn Bhd (Perodua) is targeting its total sales to
grow 6.3% to 208,000 units this year
from 195,600 units in 2014, driven
by continued demand for its newly-launched models, said president
and chief executive officer (CEO)
Datuk Aminar Rashid Salleh.
“We believe that our Axia and the
new Myvi models will boost sales
growth this year, despite operating
in a challenging environment. This,
I hope, will strengthen our share in
the already crowded market,” Aminar told reporters after announcing
Perodua’s sales performance in 2014
yesterday.
He noted that 66,400 units of its
Axia model have been booked since
Aug 15 last year, of which Perodua
has delivered 29,000 units. This saw
the group’s market share in the second half of 2014 (2H14) jump 7%,
while total bookings and total registrations increased by 23% and 7%
respectively.
“Axia has been well received
and we expect the new Myvi to get
a strong demand. The new Myvi
should generate sales of 6,000 units
monthly,” he said. Both models
should up their production volume
by 7.4% to 211,000 units this year
from 198,400 units in 2014.
Last year’s production volume
dipped 1% from 198,300 units in
2013 on parts quality issues, internal processes rationalisation and
discontinued production of its Viva
model in June 2014.
On its performance, Aminar noted that Perodua’s sales were flat at
195,600 units last year from 196,100
units in 2013, partly due to flooding
in some states. The flat sales caused
Hong Leong Islamic Bank unveils
new branch concept
BY GHO C H EE Y UAN
KUALA LUMPUR: Hong Leong Islamic Bank (HLISB) has
launched a new concept branch
in Cyberjaya that offers banking
without boundaries in an effort
to strengthen its digital banking
platform in response to evolving
consumer habits in this age of
mobile connectivity.
In a statement yesterday,
HLISB said the branch, which
began operations on Nov 3 last
year, is the first of three compact branches being opened
in high pedestrian traffic locations in 2015.
“Strategically positioned in
Malaysia’s high-tech Multimedia Super Corridor (MSC), the
new branch utilises sophisticated and state of the art infrastructure and IT systems to
showcase HLISB’s digitisation
initiatives,” it said.
HLISB said it is focusing on
highly-frequented areas, such
as malls where customers can
enjoy 12-hour/seven-days a
week operations, as the preferred locations for HLISB concept branches.
It said that with over 60% of
Malaysians now being smartphone users, there is a growing
need to simplify products and
services to be more relevant to
today’s customers.
“We understand in this digital
age that our customers are looking for convenience and variety,
and have spent much time looking at the changing behaviours of
consumers to determine how to
respond to their needs as a digital institution with a high street
presence,” said HLISB managing
director and chief executive officer (CEO) Raja Teh Maimunah.
“We know that we must provide new ways for customers to
do banking, in particular today’s
tech-savvy customers who want
services to be faster and with
less intervention,” she added.
At HLISB concept branches,
customers are introduced to the
convenience of the Hong Leong
Connect service and are welcomed by a renewed banking
experience via the use of various digital and electronic mediums, including touchscreen
computers, tablets, and video
conferencing facilities.
The concept branches also
deliver advice and handle customer complaints, enquiries
and service requests remotely
via video conferencing.
Also present at the launch
was Science, Technology and
Innovation Deputy Minister
Datuk Dr Abu Bakar Mohamad Diah and Hong Leong Bank
Bhd managing director and CEO
Tan Kong Khoon.
Correction
In Wednesday’s article titled “UOB: Ringgit to fall 15% to 20% vs
US dollar” published in The Edge Financial Daily, it should be read
as the expectations that the US dollar could strengthen against a
trade-weighted index and not as reported. The error is regretted.
its market share to slip to 29.4% from
29.9% in 2013. Segmentally, Perodua
sold 82,400 Myvi units, 55,300 Alza
units, 29,100 Axia units, and 28,800
Viva units in 2014.
Aminar said Perodua has allocated a capital expenditure of RM632.1
million from RM1.32 billion in 2014
to improve production facilities.
On foreign exchange (forex) fluctuations, Aminar said it has no significant impact on Perodua as the
group has minimal forex exposure
and imports.
“We are not exposed to the US
dollar, but we do have exposure to
the yen, as some components are
imported from Japan. With high
local content, which is more than
85%, forex volatility is irrelevant to
us,” he said.
As for exports, Aminar said Perodua will not be aggressive in selling its vehicles overseas — at least
From left : Perodua executive director Zainal Abidin Ahmad, Aminar, chairman Tan Sri
Asmat Kamaludin and Perodua Auto Corp Sdn Bhd president Yasumitsu Morita at the
launch of the New Perodua Myvi facelift. Photo by Suhaimi Yusuf
for the next two years — as it faces
after-sales support challenges and
trade regulation issues in certain
geographical markets.
“We won’t be focusing on exports
in the second phase of our transformation plan, which begins this year
until 2019. We plan to retain our
strong foothold in the domestic market,” he said, adding that Perodua’s
export volume will continue to remain at around 5,000 units per year.
On whether Perodua will introduce a car allowance rebate system
— also known as “cash for clunkers”
— Aminar said the group is still in
talks with the government.
“There are still unclear answers
as to who will bear the cost, the age
of the cars, and the effectiveness of
the scrappage mechanism. I fully
support this idea [cash-for-clunkers]
but only if there is a clear direction
and proper mechanism in place,”
he added.
Malaysia Automotive Institute
CEO Mohamad Madani Sahari revealed on Monday that the government was in the final stages of
discussion with car manufacturers
to re-introduce the rebate system,
potentially from March onwards.
The government in 2009 introduced the scheme for Perusahaan
Otomobil Nasional Sdn Bhd and
Perodua at a cash rebate of RM5,000
per vehicle to avoid a crippling
plunge in sales.
Ekovest gets PM’s Department’s
nod to privatise RM3.57b Duke 3
BY Y I M I E YO NG
KUALA LUMPUR: Ekovest Bhd,
controlled by tycoon Tan Sri Lim
Kang Hoo and Datuk Haris Onn
Hussein, the brother of Defence
Minister Datuk Seri Hishammuddin Hussein, has received the green
light from the Prime Minister’s Department’s Public Private Partnership Unit (PPPU) on its proposed
privatisation of the RM3.57 billion Duta-Ulu Kelang Expressway
Phase-3 (Duke Phase-3).
Ekovest (fundamental: 2.4; valuation: 0.9) said its wholly-owned
subsidiary, Konsortium Lebuhraya
Utara-Timur (KL) Sdn Bhd (Kesturi), has received a letter from the
PPPU, approving in principle the
proposed privatisation of the Duke
Phase-3 on Jan 14. The proposed privatisation of
Duke Phase-3 is subject to further
negotiation to finalise its technical
and financial terms and conditions, it said in a filing with Bursa
Malaysia yesterday. “We expect
to sign the (definitive) agreement
(with the government) within five
to six months. After that we have a
year’s time to engage with banks
for financing. Construction will
start once we have secured financing from the bank,” Ekovest managing director Datuk Lim Keng
Cheng told The Edge Financial
Daily yesterday.
He said construction of the highway may begin in June next year,
with completion in four years.
The proposed alignment of Duke
Phase-3, measuring 35km, will traverse north to south of Kuala Lumpur and will serve areas such as
Universiti Tunku Abdul Rahman,
Wangsa Maju, Setiawangsa, Ampang, the Tun Razak Exchange and
the Bandar Malaysia Development
Corridor, and Kerinchi.
A special purpose vehicle under Nuzen Corp Sdn Bhd, the immediate holding company of Kesturi and a wholly-owned subsidiary
of Ekovest, will be incorporated
to undertake the Duke Phase-3,
according to the statement. “The
project cost of the Duke Phase-3 is
estimated to be RM3.57 billion,”it
added.
Pavilion REIT’s annual distribution rises 8.2%
BY M E E NA LAK S HANA
KUALA LUMPUR: Pavilion Real
Estate Investment Trust’s (Pavilion REIT) annual distribution per
unit for the full year ended Dec 31,
2014 (FY14), improved by 0.6 sen or
8.2% to 7.96 sen. This translates to a
distribution yield of 5.5%, based on
the REIT’s closing price of RM1.46
as at the end of last year.
In a statement yesterday, Pavilion REIT Management Sdn
Bhd said Pavilion REIT’s (fundamental: 2.8) distributable income of
4.12 sen for the second half of 2014
(2HFY14) is expected to be payable
on Feb 27. The REIT closed 1 sen
lower at RM1.46 yesterday, with a
market capitalisation of RM4.43 billion. According to the REIT, which
owns the Pavilion Kuala Lumpur
shopping mall in downtown Bukit
Bintang, its gross revenue increased
by 7.1% to RM402.1 million in FY14
compared with FY13. .
“Although 2015 is expected to
remain challenging for the retail
sector due to weak consumer sentiment from impending GST implementation, weakening of the
ringgit and inflationary pressures,
the manager will continue to engage with its stakeholders to con-
tinue to attract shoppers, manage
its operational cost effectively, and
seek investment prospects to ensure the best achievable return for
unitholders,” said Pavilion REIT
Management.
6 HOME BUSINESS
Matrade: Next six
months crucial for
Malaysian trade
Must remain resilient in view of the uncertain global outlook
‘The new 30-storey Menara Hap Seng 2 is set to become yet another distinctive landmark
in Kuala Lumpur, after its award winning Menara Hap Seng,said Khor at the Menara Hap
Seng 2’s Appreciation Night.
SAM FONG
BY MEENA L A KSHANA
KUALA LUMPUR: The next six
months will be crucial for Malaysian trade as it has to remain resilient in view of the uncertain global economic outlook and slower
growth expected in the global economy this year.
Malaysian External Trade Development Corp (Matrade) chief
executive officer Datuk Dr Wong
Lai Sum (pic) said yesterday that
the various 2015 economic outlooks from international organisations and local bodies indicate
there are a lot of uncertainties in
the global economy, and that some
moderation is expected to affect
world demand, which will impact
Malaysia.
“What we need to do now is to
sustain our presence in markets, to
sustain market shares,” she told the
media after speaking on Matrade’s
promotional activities this year.
“There will be some form of
moderation. I do believe so. It is
something we have to watch [over]
the next six months to see what
happens.
“Every other country is also
carefully watching [out for that],
whether oil producing or non-oil
producing countries,” she said.
Despite the more than 50%
plunge in crude oil prices since
June last year, the World Bank lowered its global growth forecast for
this year on Tuesday to 3% and for
next year to 3.3%, due to discouraging economic prospects in the
eurozone, some emerging economies and Japan.
The World Bank had earlier in
June 2014 targeted global gross domestic product (GDP) to grow by
3.4% this year and 3.3% next year.
Brent crude was trading at near
six-year lows of US$48.55 (RM172.83)
per barrel yesterday, raising fears that
US shale companies may be put out
of work in view of high loans taken
to fund the shale drilling and exploration business. The plunge in crude oil prices has
also placed pressure on economies
reliant on oil revenue, such as Iran,
Russia, Venezuela and Malaysia. In
Malaysia, the sharp oil decline caused
the ringgit to plummet to a fresh 5½year low on Wednesday at RM3.6020
against the greenback, before rebounding to RM3.5640 yesterday.
Both the World Bank and the Malaysian Rating Corp Bhd had projected that Malaysia’s GDP growth is
likely to decelerate to 4.7% this year.
On the lower ringgit, Wong said
the effects would be mixed for trade.
“Some say the lower ringgit stimu-
lates exports but actually, the impact
of the ringgit on Malaysian industries
and exports is a mixed one.
“It depends very much on the
sectors. Some sectors have primarily
traded in the US dollar, especially the
electronics sector, where they buy in
dollars and sell in dollars. Naturally, the impact is not very significant
for them.
“For industries with resources
based in Malaysia, when they export, they get more ringgit. So for
them it is absolutely positive. But
for industries that are dependent on
imported components and content,
their inputs will be more expensive,”
she said.
She said now is an opportune
time for companies to explore alternative sources for content, feedstock and components that are
made in Malaysia, as they would be
more cost effective for production.
On the impact of decreasing oil
prices, Wong said the situation is
similar to that of the depreciating
ringgit, in that companies that rely
on petroleum as feedstock stand to
gain from the low oil prices, such
as the plastics and petrochemical
industries.
Matrade will embark on 116 export promotion programmes in 46
countries across Asia, Europe, the
Middle East and the US this year,
with an emphasis on the Asean
region.
Among the events are the Kuala
Lumpur International Aerospace
and Defence Business Convention on April 27 to April 29 this
year and the Asian Oil, Gas and
Petrochemical Engineering Exhibition in June.
Hap Seng Land launches Grade
A commercial office in KL
BY G H O C H E E Y UA N
KUALA LUMPUR: Hap Seng Consolidated Bhd’s (fundamental score:
1.5; valuation score: 2.1) unit Hap
Send Land Sdn Bhd recently unveiled its second commercial office development in Peninsular
Malaysia — a 30-storey Grade A
office building here, which has a
gross development value (GDV)
of RM380 million.
“Menara Hap Seng 2, adjoining
the existing Menara Hap Seng [in
Jalan P Ramlee), is built in compliance with the Green Building Index
(GBI), hence ensuring the efficient
use of resources. This ultimately will
translate into operational savings
and enhanced workplace productivity,” said Hap Seng Consolidated
in a statement.
Menara Hap Seng 2 is built on
1.2 acres (0.485ha) of freehold land.
It offers 326,000 sq ft of net lettable area, comprising office spaces
ranging from 1,200 sq ft to 13,755
sq ft in size.
“Today’s [last Friday] unveiling goes beyond building spaces.
We are not here only to facilitate
a Grade A operating environment
designed for our tenants’ long-term
business continuity and connectivity, we intend to establish ourselves
as a reputable property player,” said
Hap Seng Land chief operating officer David Khor.
Menara Hap Seng 2’s green
building effort includes its energy
conservation features. It also implements sustainable technologies
such as using energy-efficient light
fittings and centralised air conditioning with variable air volume.
“These features present a tremendous value proposition to our
target market — both local and multinational companies — seeking a
premium office space in a prestigious new address,” Khor said.
“In fact, even before its completion, we were able to secure multinational tenants. This, I believe,
can be attributed to our strategic
location, our value proposition to
our tenants as well as our status
as a GBI-certified Grade A office
building,” he said.
Shares of Hap Seng Consolidated closed five sen or 1.21% lower
yesterday at RM4.09 with 1.57 million units traded, giving it a market
capitalisation of RM8.86 billion.
Go to www.theedgemarkets.com for
more details on a company’s financial dashboard. GW Plastics shareholders to get last dividend before RTO
BY Y EN N E FOO
KUALA LUMPUR: Shareholders of
GW Plastics Holdings Bhd (fundamental score: 1.2; valuation score:
0.3) will be rewarded with a final
dividend before the company completes the reverse takeover exercise
(RTO) by property developer MCT
Consortium Bhd (MCT) in the second quarter of 2015 (2Q15).
“We still have some cash, which
we will distribute by way of dividends
to existing shareholders. It is to ensure that existing shareholders are
taken care of. We have not fixed the
date yet but it will be done before the
completion of the [RTO] exercise,”
GW Plastics chief executive officer
Lim Kok Boon told newsmen after
the company’s extraordinary general
meeting (EGM) yesterday.
Lim said the amount to be distributed is yet to be determined. As
at Sept 30, 2014, the former plastics
manufacturer’s net cash position
was RM5.31 million.
Upon the completion of the RTO,
GW Plastics will emerge as a property
development firm and be renamed
MCT Bhd.
Lim assured existing shareholders
that they will not get the short end
of the stick in the RTO bargain as
the board will keep the interests of
its shareholders as the cornerstone
in the deal.
“We have explained to them [minority shareholders] ... this exercise
will add value to their shares,” said Lim.
GW Plastics fell into Practice Note
17 (PN17) status in January last year
following the disposal of its core assets — Great Wall Plastic Industries
Bhd and GW Packaging Sdn Bhd —
to Scientex Bhd for RM283.2 million
in 2012.
At the beginning of 2014, news
broke that GW Plastics had proposed to acquire the entire shares
of property development firm MCT
Consortium Bhd through a RTO for
RM1.21 billion.
The proposed RTO by MCT will
see GW issue 1.08 billion new GW
Plastics shares as well as RM135.16
million worth of 30-month zero coupon irredeemable convertible unsecured loan stocks.
Under GW Plastics’ regularisation
plan and the RTO exercise, existing
GW Plastics shareholders will gain
three free shares for every two new
shares they hold.
Lim said the regularisation plan
also provides for a restricted offer
for sale on a disproportionate basis
to ensure that it favours minority
shareholders.
“When we consolidated our [issued and paid-up capital of 235.6
million ordinary] shares of one sen
each to [2.36 million ordinary shares
of] RM1 each, minority shareholders
ended up with a very small amount
of shares.
“So, for the restricted offer for sale,
we have actually done it in a way
where we have a non-proportionate
allocation. Minority shareholders
will get a relatively bigger portion
and this will favour them,” Lim said.
He said GW Plastics is on track
to complete its corporate revamp
under the RTO and that there are no
“major roadblocks” after GW Plastics
shareholders gave their approval at
the EGM yesterday.
Lim said the company will now
have to make applications to relevant authorities for the issuance of
its new shares. Meanwhile, MCT
will have to undergo an internal
reorganisation.
“It is now mostly procedural. The
moment the transaction is completed
and the new shares are listed, we are
technically no longer a PN17 company. That will happen some time
in 2Q15,” said Lim.
HOME BUSINESS 7
Pos Malaysia eyes
courier market
share growth
E-Poslaju service will benefit businesses, especially SMEs
BY SU PRI YA SU REN DRAN
KUALA LUMPUR: Pos Malaysia Bhd
(fundamental score: 2.5; valuation
score: 0.9) is looking to increase its
market share in the courier division
with E-Poslaju, its online courier
service application.
Group chief executive officer
Datuk Iskandar Mizal Mahmood
said the national courier’s current
market share in courier services is
about 27.6% to 30%.
For now, however, Pos Malaysia has no specific growth target
numbers as it just started doing
focus group studies on the new
online service.
“Once we get the response from
the focus group, which includes
customers of Pos Malaysia, we will
roll out E-Poslaju,” he told reporters at the launch of the group’s new
corporate identity by Communications and Multimedia Minister
Datuk Seri Ahmad Shabery Cheek
yesterday.
Iskandar said the new service
will benefit businesses, especially
small to medium enterprises, as it
eliminates the need for traditional
form filling.
Pos Malaysia’s courier services
made up about 30% of its revenue
for the first half of its financial year
ending March 31, 2015 (1HFY15).
The mail services segment was its
main revenue contributor, at 45%.
For 1HFY15, the national courier reported revenue of RM740.46
million, which was 10% higher than
1HFY14, but its net profit dropped
as much as 27.2% to RM61.1 million
in 1HFY15 compared with RM83.94
million in the same period a year
ago mainly due to higher operating
expenses such as staff costs and
transport charges.
Earlier, Pos Malaysia said its new
Scomi bags RM300m worth of
contracts in last three months
BY G H O C H E E Y UA N
KUALA LUMPUR: Scomi Energy Services Bhd’s (SESB) (fundamental score: 2.35; valuation score: 2.4) oilfield services division
has bagged RM300 million worth of contracts in the last three
months to provide drilling fluids and drilling waste management services in Australia, Pakistan, India as well as West Africa.
“The clients for these contracts consist of both national and
international oil companies,” it said in a statement yesterday.
Th is brings the value of contracts secured by SESB in the last
three months to RM475 million.
“The significant amount of contracts won in the last three
months provides us with a major boost to kick-start the new
year. Our decision to adopt an asset-light strategy focusing on
growing core business, expanding product lines and building
integration capability has been well rewarded as evidenced by
our continuous success in winning new contracts,” said SESB
chief executive officer Shah Hakim Zain.
“Our strategy, which has been put in place well before the
oil price crisis set in, has improved our resilience in the current
tough market conditions. It has allowed us to remain competitive amid the uncertainty in the oil and gas sector.
“Consequently, we are able to remain active in the market by
continuing to put in competitive bids for new contracts,” he said.
The group has also been actively introducing graphene-enhanced products and applications that include drilling and completion fluids, production chemicals, enhanced oil recovery solutions, water treatment and well enhancement and stimulation.
“These products have proven to be beneficial to our customers
while having the advantage of being ‘green’,” said Shah Hakim.
Scomi Energy shares were up 0.83% to close at 60.5 sen yesterday, giving it a market capitalisation of RM1.4 billion.
Eversendai completes keel laying
for self-propelled jack-ups
BY A H MA D N AQ IB ID R IS
(From left) DRB-Hicom Bhd Chief Operating Officer of Property and Services Datuk
Mohammed Razeek Md Hussain, Ahmad Shabery and Iskandar at the launching of the
new Pos Malaysia logo. Photo by Shahrin Yahya
Once we get the
response from the
focus group, which
includes customers of
Pos Malaysia, we will
roll out E-Poslaju.
logo embodies the spirit of a modern, forward-thinking organisation.
“The ‘fast forward’ arrow in our
new logo reinforces the brand’s progressive and innovative qualities,
and denotes its digital engagement
in the 21st century,” said Iskandar.
Pos Malaysia’s shares closed
down 7 sen to RM4.40 yesterday,
giving it a market capitalisation of
RM2.39 billion.
The Edge Research’s fundamental score
reflects a company’s profitability and
balance sheet strength, calculated
based on historical numbers. The valuation score determines if a stock is
attractively valued or not, also based
on historical numbers. A score of 3
suggests strong fundamentals and
attractive valuations. Go to www.
theedgemarkets.com for more details
on a company’s financial dashboard.
KUALA LUMPUR: Construction and engineering group Eversendai Corp Bhd’s (fundamental score: 0.75; valuation score: 1.2)
unit Eversendai Offshore RMC FZE has completed the keel laying
for both units of GustoMSC NG-2500X self-propelled jack-ups,
awarded by Vahana Offshore (S) Pte Ltd.
In a statement yesterday, Eversendai said the keel laying
signifies the commencing of the construction of the vessels,
respectively named Aryan and Arjun, which are expected to be
delivered in 2016.
“Our vessels are largely built in a series of pre-fabricated, complete hull sections rather than being built around a single keel.
“The event recognised as the keel laying is the fi rst joining of
modular components, or the lowering of the fi rst module into
place in the building dock,” it said.
The keel laying ceremony was held at Eversendai Offshore’s
waterfront yard facility in RAK Maritime City, Ras Al Khaimah,
the United Arab Emirates.
Eversendai executive chairman and managing director Tan
Sri AK Nathan said the milestone substantiates the group’s decision to venture into the oil and gas (O&G), petrochemical and
process plant construction sectors.
He noted that the group is looking forward to expand its presence in the O&G industry.
“We anticipate our foray into this sector to be a significant
contributor to Eversendai group’s earnings in time to come,”
he added.
KESM to increase auto microchip testing
BY GHO CHEE Y UAN
KUALA LUMPUR: KESM Industries Bhd (fundamental score: 2.35;
valuation score: 2.4) will increase
testing services for microchips used
in autonomous or self-driving vehicles, capitalising on encouraging
prospects of the global auto electronics segment.
Executive chairman and chief
executive officer Samuel Lim Syn
Soo (pic) said the group expects
automotive microchip demand
to pick up. He said self-driving
cars are expected to hit the world
market within the next decade.
“As such, demand for microchips is expected to grow significantly over the next few years,” he
told reporters after KESM’s annual
and extraordinary general meetings
yesterday.
KESM has three semiconductor
testing plants, which are located
in Selangor, Penang and Tianjin,
China.
Lim said the three plants are
currently 70% to 80% utilised.
On capital expenditure
(capex), Lim said KESM will invest more money in its business
to maintain its competitiveness.
“I can’t provide you with an exact figure, but the average capex
for the past five years was about
RM60 million, and it will be more
this financial year,” he said.
He said KESM’s capex for the
current financial year ending July 31,
2015, might exceed the RM60 million average over the last five years.
From a broader viewpoint, Lim
said the global semiconductor market has been positive, after recording a compound annual growth rate
of 13% over the past three years.
He expects the trend to contin-
ue, although demand growth for
microchips used in mobile devices and personal computers was
expected to be flattish.
On the weakening ringgit against
the US dollar, Lim said KESM
conducts its business in the local
currency, hence, it is not highly
exposed to foreign exchange fluctuation.
According to notes accompanying KESM’s latest financials,
its borrowings as at Oct 31, 2014
amounted to RM65.74 million. Of
that amount, RM12.43 million is
denominated in US dollars.
8 ST O C KS W I T H M O M E N T U M
JCY International Bhd
WITH the ringgit’s recent depreciation, investors are looking at companies or sectors
with export exposure, as they will gain from
the weak ringgit in terms of margins or export competitiveness.
One such company that has recently attracted investors’ interest is JCY International, which manufactures hard disk drive
(HDD) components with factories in Johor,
Thailand, Penang and China. Its shares have
seen a 48.6% increase in just one month —
from 46.1 sen on 16 December 2014 to 68.5
sen yesterday.
JCY has long fallen out of favour with investors, following a series of disappointing
results that showed the challenges faced by
hard disk drive (HDD) component manufacturers. These include competition for HDD
from solid state drives, as well as squeezed
margins due to cost-down pressure by their
multinational customers and the previously
strong ringgit.
With 78% of its sales denominated in foreign currencies, further ringgit weakness may
be positive for the company, as is already
evident in its latest results.
Revenue for JCY has ranged from RM 1.6
billion to RM2.2 billion over the last 4 years.
However, margins have see-sawed year on
year, ranging from a loss in FY2013 to a high of
19.06% before ending at 6.4% in FYSept2014.
The company attributes its turnaround to
better demand and the ringgit’s weakness.
JCY has also managed to increase its net
cash holdings tremendously in just 2 years,
starting from about RM600,000 in 2012 to
RM 178.3 mil in FY2014. Dividend yield for
FY 2014 was 6.79% with a historical payout
once every 2 years.
The stock is trading at a trailing 12-month
P/E of 11.42 times and 1.21 times book. The
Edge Research rates JCY a Fundamental
score of 1.8 out of 3 and a Valuation score
of 1.2 out of 3.
Valuation factor *
1.20
Fundamental factor **
1.80
Trailing 12m P/E (x)
11.42
Trailing 12m PEG (x)
0.00
P/NAV (x)
1.21
Trailing 12M Dividend yield (%)
6.29
Market capitalisation (RM mil)
1371.59
Shares outstanding (ex-treasury) mil 2031.98
Beta
1.25
12-month price range
0.46 - 0.74
*Valuation factor — Composite measure of historical return & valuation
**Fundamental factor — Composite measure of balance sheet strength &
profitability
Note: A score of 3.0 is the best to have and 0.0 is the worst to have
JCY INTERNATIONAL BHD
(ALL FIGURES IN RM MIL)
Income statement
Turnover
EBITDA
Depreciation and amortisation
EBIT
Associates
Interest income
Interest expense
Extraordinary gain/(loss)
Pre-tax profit/(loss)
Net profit/(loss) - owners of company
Balance sheet
Fixed assets - PPE
Biological assets
Intangibles & goodwill
Cash and equivalents
Total current assets
ST borrowings
Total current liabilities
Total assets
Shareholders’ fund
Long term borrowings
JCY INTERNATIONAL BHD
RATIOS
DPS (RM)
Net asset per share (RM)
ROE (%)
ROA (%)
Turnover growth (%)
Net profit growth (%)
Net margin (%)
Current ratio (x)
Gearing (%)
Interest cover (x)
FY11
30/9/2011
FY12
30/9/2012
FY13
30/9/2013
LATEST 4QFY14
30/9/2014
1671.0
116.1
98.6
17.5
0.8
4.5
13.8
13.5
2241.0
532.8
102.0
430.7
1.1
3.1
428.8
427.3
1599.0
52.3
107.5
(55.2)
1.0
1.0
(55.2)
(61.6)
462.9
53.2
24.9
28.3
0.1
0.1
28.2
26.7
702.3
19.0
92.7
658.2
224.7
483.0
906.8
885.3
-
743.8
129.8
879.8
129.1
481.0
1156.0
1129.0
-
698.5
177.2
705.6
54.9
310.3
1102.0
1073.0
-
635.5
260.8
888.2
82.5
366.5
1163.0
1132.0
-
FY11
30/9/2011
FY12
30/9/2012
FY13
30/9/2013
ROLLING 12-MTH
0.43
1.53
1.43
(17.81)
(92.25)
0.80
1.36
14.91
26.05
0.09
0.55
42.43
41.43
34.11
3,073.15
19.06
1.82
173.53
0.53
(5.60)
(5.46)
(28.67)
(3.86)
2.27
54.38
0.04
0.56
10.95
10.68
17.15
6.42
2.42
236.85
I N V E ST I N G I D E A S 9
I N S I D E R A S I A’S S TO C K O F T H E D AY
WILLOWGLEN MSC BHD
(ALL FIGURES IN RM MIL)
Willowglen MSC Bhd
WE like Willowglen for its growth prospects, asset-light business model that is
highly scalable and strong cash from operations. With some 83% of revenue derived
from Singapore, the company will also
benefit from the strengthening Singapore dollar.
Willowglen is a leading provider of Supervisory Control and Data Acquisition
(SCADA) solutions, a system used to monitor and control industrial processes and
facilities in various industries such as
power plants, transportation, oil and gas,
water and wastewater, and municipal and
building service.
It is well established in Singapore where
major clients include the Housing and
Development Board of Singapore (HDB),
Singapore Power and Public Utilities Board
of Singapore. Domestic clients include
Prasarana Malaysia and Petronas Gas.
Turnover grew at a CAGR of 23.4% from
RM54.5 million in 2010 to RM102.6 million
in 2013, underpinned by strong growth in
its Singapore operations. Whilst Willowglen
reported lower y-y earnings in 9M2014,
this was due, primarily, to upfront spending to cater to future growth. As such, we
expect earnings to pick up smartly going
forward.
In November 2014, Willowglen secured
a new two-year contract worth RM14.2
million from Singapore Power. With growing need for public safety and protection
of assets, it stands to benefit from the development of infrastructure facilities and
high-rise buildings in both Singapore and
Malaysia.
The Edge Research rates it a Fundamental Score of 2.55 out of 3. It has a sturdy
balance sheet — net cash stood at RM55.9
million or 23 sen per share as at end-Sept
2014, up from RM37.7 million in FY2010 —
and EBITDA margin of over 21%. In 2013,
ROE was a high 24.5%.
Annual dividends ranged from 2 to 3
sen per share since 2009.
The stock is trading at a trailing
12-month P/E of 9.8 times and 1.9 times
book.
Insider Asia will feature a new stock pick on every alternate day.
T O N G ’S
MOMENTUM
P O RT F O L I O
STOCKS on the local bourse closed in
positive territory on Thursday, recovering
its early morning losses, and more. The
FBM KLCI index added a marginal 0.17%
to close at 1,745 points. Market breadth
was positive, with gainers outperforming
losers 1.75 to 1.
The surge in oil prices overnight proved
temporary, falling back to trade at around
$47.55 and $47.30 for WTI and Brent, respectively. The spread between both benchmarks has narrowed to only $25 cents per
barrel from US$4 at the beginning of the
year. Notably, the Brent, a global benchmark is now trading lower than the US
market-driven WTI.
Global markets close mixed. Overnight,
Wall Street fell for the fourth consecutive
day while Europe and Asian markets are up.
I continue to be cautious on the outlook
for Malaysian equities and have therefore
kept my portfolio unchanged with a high
cash holding level. Some of the Stocks with
Momentum continue to offer trading opportunities, but one has to be nimble given
current volatile market conditions. Those
with a longer-term horizon should look at
my value investing portfolio, published in
The Edge weekly, which buys from InsiderAsia’s stock picks.
Currently, I am only holding Willowglen,
which went up 3 sen to close at 78.5 sen.
Income Statement
Turnover
EBITDA
Depreciation and amortisation
EBIT
Associates
Interest income
Interest expense
Extraordinary gain/(loss)
Pre-tax profit/(loss)
Net profit/(loss) - owners of company
Balance sheet
Fixed assets - PPE
Biological assets
Intangibles & goodwill
Cash and equivalents
Total current assets
ST borrowings
Total current liabilities
Total assets
Shareholders’ fund
Long term borrowings
WILLOWGLEN MSC BHD
RATIOS
DPS (RM)
Net asset per share (RM)
ROE (%)
ROA (%)
Turnover growth (%)
Net profit growth (%)
Net margin (%)
Current ratio (x)
Gearing (%)
Interest cover (x)
QUANTITY
BOUGHT PRICE
RM
9,000
0.789
FY11
31/12/2011
FY12
31/12/2012
FY13
31/12/2013
LATEST 3QFY14
30/9/2014
52.2
10.1
0.6
9.5
0.8
0.0
10.2
8.5
83.4
18.3
0.7
17.6
0.6
0.0
18.2
15.4
102.6
23.4
0.8
22.7
0.5
23.1
19.4
23.9
4.9
0.3
4.6
0.1
4.7
3.8
4.8
35.1
58.9
5.7
62.5
62.1
-
5.2
30.7
74.5
11.7
72.6
72.3
-
7.1
43.0
95.6
18.0
86.5
85.9
-
8.1
1.3
55.9
96.1
14.4
93.0
92.5
-
FY11
31/12/2011
FY12
31/12/2012
FY13
31/12/2013
ROLLING 12-MTH
0.03
0.25
13.82
13.71
(4.24)
(8.74)
16.30
10.25
402.32
0.03
0.29
22.88
22.77
59.94
80.75
18.43
6.38
1,016.33
0.02
0.35
24.47
24.34
22.99
25.90
18.86
5.29
-
0.02
0.38
22.19
22.07
4.02
(3.79)
17.63
6.68
-
CURRENT VALUE
RM
GAIN / LOSS
RM
% GAIN / LOSS
7,065.0
(39.3)
(0.6%)
BOUGHT VALUE CURRENT PRICE
RM
RM
Shares held:
Willowglen MSC Bhd
Total
7,104.3
0.785
--------------7,104.3
--------------- --------------7,065.0
(39.3)
--------------7,104.3
--------------- --------------7,065.0
(39.3)
Shares bought:
No shares were bought today.
Total shares held
(0.6%)
Shares sold:
No shares were sold today.
Cash balance
94,369.9
Realised profits / (losses)
1,474.3
Total Portfolio Returns
Annualised returns for portfolio
100,000.00
101,434.9
1,434.9
Portfolio Beta
Risk adjusted returns for portfolio
1.4%
2.7%
1.166
2.3%
Performance Comparison
FBM KLCI
FBM KLCI Emas
At portfolio start
1,892.7
13,163.7
Current
1,745.0
12,016.5
Change
(7.8%)
(8.7%)
Relative portfolio outperformance
9.2%
10.1%
This is a personal portfolio for information purposes only and does not constitute a recommendation or solicitation or expression of views to influence readers to buy/sell any stocks.
Portfolio started on 8 July 2014 with RM100,000.
10 B R O K E R S’ C A L L / T E C H N I C A L S
A shaky start to 2015
BY LEE CHENG HOOI
A
merican stock markets plunged on
Wednesday as the
disappointing December retail sales
figures, softer copper prices and further signs of stagnating global growth sent investors
running for cover into government
bonds. The SP500 Index tumbled
11.76 points to close at 2,011.27
points while the Dow plunged
186.59 points to end at 17,427.09.
In Malaysia, the FBM KLCI index gyrated in a wild range of 32.18
points for the week with lower volumes of 1.36 billion to 1.93 billion
traded. The index closed at 1,745.00
on Jan 15, up 2.99 points from the
previous day as blue chip stocks like
CIMB Group Holdings Bhd, Malayan Banking Bhd, RHB Capital Bhd,
SapuraKencana Petroleum Bhd and
Sime Darby Bhd caused the index
to inch up on some local nibbling
activities. The ringgit remained a
touch firmer against the US dollar at
RM3.5650 as Brent crude oil settled
to US$47.25 (RM168) per barrel.
The index rose on a rally from
the 801.27 low (October 2008) to
the previous 1,826.22 all-time high
(May 2013) and it represents an extended Elliott Wave “Flat” rebound
in a “Pseudo-Bull” rise completed. The next few months’ index
price movements since May 2013
had key swings of 1,723.74 (low),
1,811.65 (high), 1,660.39 (low),
1,805.15 (high), 1,759.66 (low),
1,882.20 (high), 1,769.80 (low),
1,838.69 (high), 1,802.88 (low),
1,896.23 (high), 1,837.28 (low),
1,879.62 (high), 1,766.22 (low),
and 1,858.09 (high).
The index appears to be in a se-
vere downtrend since the 1,896.23
high of July 2014. An intermediate
low was seen at 1,671.82 on Dec 17.
As expected, the 2014 year-end window dressing short-term rebound
phase was pyrrhic in nature and
stalled at 1,770.52 (Dec 30). The
FBM KLCI index then traded between that 1,770.52 high and the
recent 1,706.18 low.
All the index’s daily signals have
turned positive (except Oscillator) recently. As such, the index’s
weaker support levels are seen at
the 1,671, 1,706 and 1,738 levels
while the resistance areas of 1,745,
1,770 and 1,858 will cap any index
rebound.
The FBM KLCI’s 18 and 40 simple moving averages (SMAs) depict
a neutral trend for its daily chart.
However, the 50 and 200 SMAs have
also issued a “Dead Cross” and the
index prices remain below these
two longer-term SMAs.
Due to the volatile tone for the
FBM KLCI index, we are recommending a chart “sell” on Tambun
Resources Bhd. Tambun released
their third quarter financial year
2014 (3QFY14) results at the end of
November 2014 and will announce
their 4QFY14 results in February
2015. Further to the 3QFY14 results announcement, revenue rose
by 20.3% year-on-year while profit
before tax increased by 11.5%. The
better profitability was attributed to the property development
segment as a result of increase in
billings and higher take-up rates as
well as better percentage of project
completions.
Overall, the positive fundamental for Tambun appears to have
been factored into the share price.
Despite the higher profitability, investors continued to sell the stock
recently. The weaker investor sentiment can be seen across the prop-
erty sector as many property analysts expect property transaction
volumes to decline.
A check of the Bloomberg consensus reveals that four research
houses have coverage on Tambun, with two houses having “buy”
calls and another two “hold” calls.
This stock currently trades at a low
price-earnings ratio of 6.3 times
while its price-to-book value ratio
of 1.84 times indicates that its share
price is trading at a steep premium
to its book value. Return on equity
is rather high at 30% while its pretax margin stands at 31.3%.
Tambun’s chart trend on the daily and weekly time frames is very
firmly down. Its share price made
a large decline since its major daily
Wave-5 all-time high of RM2.62 in
September 2014. Since that RM2.62
high, Tambun fell to its December
2014 recent low of RM1.40.
As prices broke below its recent
key critical support levels of RM2
and RM1.77, look to sell Tambun
on any rebounds to its resistance
areas as the moving averages depict
very firm short- to medium-term
downtrends for this stock.
The daily and weekly indicators
(like the CCI, DMI and Oscillator)
have issued sell signals and now
depict very firm indications of Tambun’s eventual move towards much
lower levels. It would attract firm
selling activities at the resistance
levels of RM1.58, RM1.77 and RM2.
We expect Tambun to witness weak
buying interest at its support levels
of RM1.40, RM1.47 and RM1.55. Its
downside targets are located at 99
sen, 85 sen and 52 sen.
Lee Cheng Hooi is the regional
chartist at Maybank Kim Eng.
The views expressed in the article are the opinions of the writer
and should not be construed as
investment advice. Please exercise
your own judgment or seek professional advice for your investment
decisions. Technical report appears
every Wednesday and Friday.
Property sales may soften
HARIS HASSAN
Property sector
Maintain neutral on the property sector: Against a backdrop of
a softening and challenging economic environment, and tougher
and more stringent credit approval standards, we are maintainting
our “neutral” stance on the property sector.
With strong unbilled sales, revenues will likely remain robust. However, developers’ margins would
come under pressure in light of the
weak property market sentiment
and rising development costs after
the implementation of the goods
and services tax (GST) in April.
We expect property sales in the
first quarter 2015 to remain encouraging on the back of purchases ahead of the implementation of
GST. Thereafter, we believe property
sales may soften.
The softer gross domestic product (GDP) growth of 5% in 2015 estimation, from 5.8% in 2014 does
not help either. Even the World
Property sector
STOCK
SP Setia
IOIPG
Sunway
IJMLand
UOA Dev
Tropicana
RATING
SH PR
(RM)
TP
(RM)
Sell
Hold
Buy
Buy
Hold
Buy
3.40
2.16
3.29
3.40
2.14
1.04
2.79
2.34
3.60
4.13
2.22
1.83
MKT CAP
(RM MIL)
YEAR
END
8,630
Oct
6,996 June
5,671 Dec
5,300 Mar
3,062 Dec
1,423 Dec
CORE PER (X)
CY14 CY15
20.2
13.2
11.4
13.4
12.2
4.6
EPS GROWTH (%) P/RNAV P/BV
ROE (%)
CY14
CY15
(X)
(X) CY14 CY15
17.5 (4.7)
15.5
9.1 12.8
45.3
11.1 (9.7)
2.4
12.8 14.8
4.6
8.5 (31.9)
42.6
5.2 30.8 (10.7)
0.7
0.5
0.7
0.8
0.7
0.3
1.5
0.6
1.0
1.6
1.2
0.5
7.9
5.6
9.1
11.6
9.5
11.7
8.4
7.5
8.7
11.3
12.7
10.0
DIV YIELD (%)
FY14
FY15
2.9
3.7
3.0
2.1
4.0
6.7
4.1
3.9
3.0
2.2
5.6
6.7
Source: Affin Hwang estimates
A general view of a piece of property
belonging to IJM Land Bhd’s. The
Granview project is in Puchong South,
Selangor. Photo by Haris Hassan
Bank has lowered Malaysia’s 2015
GDP to 4.7% (from an earlier estimate of 4.9%) on the expectations
of a slower export growth, lower
investments in the oil and gas industry as well as a more moderate
private consumption, post implementation of GST.
Backed by strong unbilled sales,
we believe developers’ revenues
would remain encouraging. With a
more challenging economic environment as well as more stringent
credit approvals, developers would
likely focus on launching more a
affordable homes product. This,
in turn could impact overall margins, given the shift towards lower
margin products.
In addition, we believe margins
could be under pressure due to
competition, rising development
costs (impact from GST) and weak
property market sentiments that
will affect product pricing as well
as take-up rates.
We are maintaining our “neutral” stance on the property sector. While we are cautious on the
property outlook, we believe that
downside risk to share price is limited. For exposure to the property
sector, we like Sunway Bhd (buy;
target price: RM3.60) for its stra-
tegic property land bank, extensive experience in the construction
sector, and inexpensive valuation
of 0.7 times price to revalued net
asset value.
Among the possible upside surprise are stronger-than-expected
property sales ahead of GST implementation; unexpected relaxation
in property cooling measures, and
higher-than-expected valuation
for any upcoming property initial
public offer. — Affinhwang Capital, Jan 15
12 B R O K E R S’ C A L L
Puncak Niaga, Air Selangor
agree to Feb 9 extension
Puncak Niaga Holdings Bhd
(Jan 15, RM2.75)
Maintain hold with a target price
of RM2.78: Puncak Niaga Holdings
and Pengurusan Air Selangor Sdn
Bhd (Air Selangor) yesterday agreed
to an extension until Feb 9 for the
fulfilment of conditions precedent
in the disposal of water of assets for
RM1.55 billion.
Puncak Niaga executive chairman Tan Sri Rozali Ismail told the
press that there were terms and
conditions yet to be met under
the sales and purchase agreement
(SPA) signed between both parties
on Nov 11, 2014.
We are not perturbed by this as
we believe that some of the terms
and conditions would need time to
be fulfilled. In our checks with the
management, we understand that
these are mainly procedural issues
and would not derail the completion of the disposals.
As such, we believe the water deal
will eventually be completed given
the commitment by all parties and
Puncak Niaga Holdings Bhd
FYE DEC 31 (RM MIL)
Revenue
Core net profit
FD Core EPS (sen)
FD Core EPS growth (%)
Consensus net profit
DPS (sen)
PER (x)
EV/Ebitda (x)
Dividend yield (%)
ROE (%)
Net gearing (%)
2012
2013
2014F
2015F
2016F
3,743.9
238.1
57.9
(465.2)
5.0
4.8
5.3
1.5
61.1
957.8
1,146.7
200.5
38.4
(33.6)
7.2
7.2
17.6
85.3
1,195.2
221.4
43.2
12.4
227.6
6.4
6.6
11.7
69.9
1,536.6
278.6
53.9
24.8
382.0
5.2
5.1
13.0
54.0
1,566.3
306.6
59.1
9.7
447.0
4.7
4.4
12.6
37.6
Source: Company, AmResearch estimates
the necessity to ensure a sustainable
water supply to the Klang Valley.
To recap, the conditions stated
in the SPA include unconditional
approvals by the Federal government; unconditional approvals of
Acqua SPV Bhd and the respective
trustees of bonds issued by Puncak
and Syarikat Bekalan Air Selangor
Sdn Bhd or better known as Syabas;
execution of the agreement between
the Selangor state and Air Selangor for the transfer of water assets,
as well as the master agreement,
and lease agreement between Air
Selangor and Pengurusan Aset Air
Bhd (PAAB) for the leaseback of water supply assets; and the receipt of
disposal consideration from PAAB
to Air Selangor.
We believe that, if all things go
well, the disposals should be completed by the first quarter of 2015
with dividends to be paid by June.
Note that the group will distribute
RM534.3 million (or RM1 per share)
as cash dividends to shareholders
within three months from the completion of the disposals.
The company intends to use
about RM1 billion of the proceeds
to expand into the oil and gas business and venture into oil palm
plantation. We note that there is a
possibility of Puncak Niaga being
classified as a cash company and
trigger a Practice Note 17 when the
disposals are completed.
We maintain “hold” on Puncak
Niaga until we see further clarity
of the group’s future plans beyond
the dividend windfall. Puncak
Niaga shareholders had approved
the disposals at an extraordinary
general meeting on Jan 7, 2015.
— AmResearch, Jan 15
Cautious stance on banks’ earnings outlook
Banking sector
Maintain underweight on banking
sector: After a tough year in 2014,
the operating environment does
not look any easier for Malaysian
banks in 2015. Apart from sliding
lending yields, banks will have to
contend with the good and services
tax’s negative impact on business
and consumer sentiments, keen
competition for deposits, slowing
residential mortgages, and guidelines for Islamic deposits.
All the above underpin our cautious stance on the earnings outlook for banks. We retain our “underweight” on the sector, keeping
Malayan Banking Bhd (Maybank)
as our top pick.
The Kuala Lumpur Financial
Index fell by 7.4% in 2014, underperforming the KLCI by 1.8%.
This primarily reflects the negative outlook for banks. The sector’s financial performance was
disappointing, with nine months
2014 net profit up a mere 2.8%
year-on-year.
We are forecasting 10.4% net
profi t growth in 2015, supported by an expansion of 8.6% in
net interest income and 10.5% in
non-interest income. There could
be downside risk to our forecast
arising from wider-than-expected
margin erosion and unexpectedly
weak non-interest income growth.
In 2015, banks will have to grapple with new earnings threats:
i) a potential slowdown in the
growth of residential mortgages;
ii) implementation GST which will
dent business and consumer sentiments; and iii) compliance with
the new guidelines for Islamic de-
Banks’ net profit and y-o-y % growth
RM mil
Net profit
y-o-y growth
%
30,000
50
25,000
40
20,000
30
15,000
20
10,000
10
5,000
0
(10)
0
’08
’09
’10
’11
’12
’13
’14
’15
’16
Source: CIMB, Company reports
posits, which will further tighten
banks’ liquidity.
We see limited prospects for an
improvement in loan growth in
2015 given the anticipated slowdown in the growth of residential
mortgages. As such, we are forecasting stable loan momentum
of 9% to 10% in 2015, on par with
the level in 2014.
We reiterate our “underweight”
stance on Malaysian banks in view
of the negative earnings outlook
in 2015.
We have “reduce” calls on three
banks: Public Bank Bhd. In our
view is overvalued, at a calendar
year 2015 price-earnings ratio of
13.6 times vs the sector average of
11.2 times. The pricey valuation is
not justified given our projection
of single-digit earnings per share
(EPS) growth in financial year 2015
(FY15) to FY16) and a below-sector dividend yield of 3.3%.
Other potential derating catalysts are continuous margin contraction, which will constrict its
topline growth, the weak expansion of its business in Hong Kong
due to intense industry competition, succession uncertainties as
Tan Sri Teh Hong Piow, the founder and controlling shareholder of
the group, is already in his 80s,
and a drop in return on equity
following its rights issue last year.
Affin Holdings Bhd. We are cautious about the earnings prospects
for Affin Holdings, as reflected in
our projected EPS drop of 28.8%
for FY14. Though EPS is expected
to recover in FY15, growth is projected to be only 2.9%. Potential
earnings risks include an upturn
in credit costs, below-industry
loan growth and weak margins.
Furthermore, the acquisition of
HwangDBS Investment Bank Bhd
is expected to dilute its EPS by an
estimated 15% to 16%.
Hong Leong Bank Bhd is known
for its prudent management but
our major concern for the group
is its slow topline expansion. Its
loan growth of 6% to 8% has been
below the industry’s pace in the
past 10 quarters (2½ years).
Although management is gunning for 9% to 10% loan growth
which is closer to the industry’s
rate, the key challenge in achieving
this is the expected industry-wide
moderation in residential mortgages, which make up the biggest
portion of its loan base.
Another potential drag on earnings growth is the expected upward reversal in the credit cost
cycle as its credit charge-off rate
was low (below 10 basis points
[bps]) in the past six quarters (even
a net write-back in the first quarter
FY14 [1QFY14] and the 1QFY15)
compared with a more sustainable level of 20bps to 30bps, in
our view.
Maybank is still an “add” and
our top pick among Malaysian
banks for its size and well-diversified business portfolio. Its geographical diversification, with
exposure to underpenetrated markets like Indonesia and the Philippines, is a boon. In Indonesia,
Bank Internasional Indonesia is
poised to benefit from the expected improvement in the operating
environment in 2015 following
Joko Widodo’s victory in the presidential election.
Other potential catalysts would
come from its continuous drive to
regionalise its operations, which
would help the group to achieve
better operating efficiencies and
cross-selling among countries in
the longer term, and the gain in
market share for its investment
banking business in the region.—
CIMB Research, Jan 15
Positive view
reaffirmed on
OCK Group with
new CEO and
updated plans
OCK Group Bhd
(Jan 15, 82.5 sen)
Maintain buy with a target
price (TP) of RM1.06: A recent
meeting with OCK Group’s new
chief executive officer (CEO) and
updates on its plans reaffirm
our positive view on the company. Investors are advised to buy
on current weakness. Maintain
a TP of RM1.06 (18.5 times financial year 2015 [FY15] forecast earnings per share [EPS],
26.2% upside), which is supported by a commendable two-year
EPS compound average growth
rate of 52%. The recent Main
Board transfer and impending
announcement of its Myanmar
venture are rerating catalysts.
We view positively the recent appointment of Dr Yap Wai
Khee as OCK’s new CEO given
his vast experience in overseeing telco assets in emerging markets under the Axiata
Group Bhd and strengthening
management execution.
Prior to taking up the position, Yap was the chief strategy officer of Robi Axiata Ltd
in Bangladesh.We believe his
insights, given that he was also
previously the CEO of Cambodia’s Mfone Co Ltd and Axiata’s head of strategy, will be
especially useful as OCK expands into new markets like
Myanmar. OCK founder and
managing director Sam Ooi will
continue to be in the driver’s
seat, spearheading the group’s
domestic and regional strategy.
We understand from the
management that the 70:30 joint
venture with a local partner to
penetrate into the lucrative tower business has been finalised
and should be concluded by the
second quarter of 2015.
OCK is set to benefit from
the explosive growth in tower
demand with Telenor Group
slated to award th remaining
3,000 sites over the next three
to five years.
The outlook for the tower
business in Myanmar remains
bright with OCK also vying for
tower maintenance contracts
to add to the 15,000 sites it currently manages in Malaysia and
Indonesia for Tier-1 telcos. We
believe this will provide a steady
stream of recurring revenue for
the group in the longer term.
OCK ought to benefit from
the next round of the feed-in
tariff (FiT) quota — 32mw — due
to be released by the Sustainable
Energy Development Authority
(Seda) at end-January. We note
that Seda will need to add 351mw
to the current allocation on top
of the projected remaining releases of 474mw to meet with the
government’s renewable energy
(RE) target of 2,080mw by 2020.
The management is hopeful
that Seda will raise the RE allocation for solar by then. It currently
stands at 64% of the allocated
RE mix. — RHB Research, Jan 15
H O M E 13
KL tourism plan aims to
draw 16 million visitors
Also targets to create 71,000 jobs through 47 initiatives by 2025
KUALA LUMPUR: The Kuala Lumpur Tourism Master Plan 2015-2025
aims to attract 16 million tourists
with RM79 billion in tourism receipts by 2025.
The plan consists of 47
game-changing initiatives that will
also create 71,000 jobs.
Federal Territories Minister Datuk Seri Tengku Adnan Tengku Mansor and Kuala Lumpur Mayor Datuk
Seri Ahmad Phesal Talib unveiled
the plan here yesterday.
The plan, developed by Kuala
Lumpur City Hall (DBKL) in collaboration with Roland Berger Strat-
Bill on militancy
to be tabled in
Parliament in
March
egy Consultants and the Federal
Territories Ministry, focuses on
nine tourism segments, namely
culture, heritage and places of interest, shopping, entertainment,
nature and adventure, luxury travel,
sports, business and MICE (meetings, incentives, conferences and
exhibitions), medical and wellness,
and education.
The city received RM19 billion
in tourism receipts in 2013.
Tengku Adnan in his speech
urged the key industry players to
come forward to share their needs
and ideas to strengthen the tour-
guidance to our fledging tourism
industry. It is a blueprint to grow
the industry, an articulate 10-year
strategic agenda and action plan
which was prepared by experts from
both the public and private sectors.
“We also want to encourage the
visitors to spend more on the attractions and to stay longer.”
He said the average length of
stay per visitor and average spending per visitor were expected to increase respectively from 3.1 nights
in 2013 to 5.5 nights in 2025 and
from RM682 per night in 2013 to
RM900 in 2025.— Bernama
Ex-leaders claim fraud in
forming branches
BY LOW HAN SHAU N
PUTRAJAYA: A bill to tackle
the threat of militant activities including the so-called
Islamic State militant group
will be tabled in Parliament
in March, said Minister in the
Prime Minister’s Department,
Nancy Shukri.
She said the move was made
following the tabling of the
White Paper “Towards Tackling the Threat of the IS Group”
by Prime Minister Datuk Seri
Najib Razak last year.
“In addition, amendments to
the existing laws such as the Security Offences (Special Measures) Act 2012 (Sosma) and the
Sedition Act (1948) will also be
tabled at the Parliament session
beginning March 9,” she told
reporters after attending the
monthly assembly of the Legal
Affairs Division (BHEUU) here
yesterday.
Nancy said the bill was necessary so that the government
had stronger powers to face any
threat at any time. She said the
government took a serious view
of the threats by militants by
taking action against civil servants involved in such activities.
“I hope we will all be wary
and keep away from elements
that can jeopardise the harmony
and peace that we are enjoying
currently,” she said. Commenting on the amendments to the
Sedition Act and Sosma, Nancy
said they were still at the discussion stage and had not been
scrutinised yet.
On another development,
Nancy said the Integrated Insolvency System developed by
BHEUU was created internally
for the Bankruptcy Module and
Accounting Module. — Bernama
ism industry. He also noted the
higher employment rate of foreign
workers in the services sector, who
outnumbered locals.
“When I walk in Petaling Street,
which is supposed to be Chinatown, what is it [I see] now? You
ask yourself,” he said.
Meanwhile, Ahmad Phesal said
the master plan provided a strategic
framework to position Kuala Lumpur as an emerging tourist destination in Asia, offering unique, branded and value-for-money products to
domestic and international visitors.
“The master plan is about giving
KUALA LUMPUR: As MIC’s internal
battle rages over the need for fresh
party elections to avoid deregistration, two former party leaders have
claimed that there was fraud in the
setting up of party branches in divisions aligned with MIC president
Datuk Seri G Palanivel.
Ex-MIC Youth chief Datuk S A
Vigneswaran and former treasurer-general Datuk R Ramanan
went to the Registrar of Societies (RoS) office in Putrajaya yes-
terday with what they said was
evidence of the alleged fraud.
The divisions involved are Ulu
Selangor, Sepang, Kuala Langat,
Petaling Jaya Selatan, Seremban,
Serdang and Subang.
“I’m here to expose evidence of
the fraudulent materials. Let them
who are involved face the music,”
Vigneswaran said.
Vigneswaran and Ramanan also
accused Palanivel of using back
channels to settle MIC’s problems
with the RoS, alleging that the president was holding a private meeting
with the registrar in a hotel.
MIC faces deregistration over
complaints of irregularities in its
party election held in 2013.
Palanivel has been accused of
delaying fresh polls in order to maintain his hold on the party, triggering
an open battle within the party with
some calling for his resignation.
“If you look properly, the divisions that are having problems now
— who are they under? Most of them
are Palanivel’s supporters and are
under his wife,” said Ramanan. —
The Malaysian Insider
Australia won’t repatriate Sirul, says report
KUALA LUMPUR: Corporal Sirul
Azhar Umar, who was sentenced
to death for the murder of Mongolian Altantuya Shaariibuu, is likely to escape the gallows, after an
Australian daily quoted officials as
saying that extraditing him to face
the death penalty would violate the
country’s laws.
The Sydney Morning Herald,
quoting a spokesman for the Attorney-General’s Department, said
Australian laws do not allow extradition in cases where the penalty
is the death sentence, The Malaysian Insider reported. Sirul is one of
two former police commandos sentenced to death for the 2006 murder.
On Tuesday, the Federal Court
allowed an appeal by the prosecution, and sentenced Sirul and Chief
Inspector Azilah Hadri to death,
overturning their acquittal by the
Court of Appeal in August 2013.
Sirul, who did not turn up at the
Federal Court, had reportedly gone
to Australia last October.
Bernama had quoted a source as
denying that Sirul had escaped, say-
The first published photos of Sirul (left) and Azilah were obtained from the police.
ing he did not have enough money
to return to Malaysia.
Bukit Aman CID director Datuk
Mohmad Salleh had earlier told
Bernama that police would liaise
with their Australian counterpart,
and would also seek Interpol’s help
should Sirul flee Australia.
“We will definitely seek the cooperation of the international police,”
he had said.
Malaysiakini reported that it has
obtained copies of Sirul’s and Azilah’s photographs, courtesy of the
Bukit Aman police headquarters.
From the start of the trial right
up to the conclusion of the final
appeal at the Federal Court, Azilah
and Sirul had arrived at and exited
the various court buildings with
their faces covered with hooded
jackets.
Home Ministry
will act on
writings that
can cause
disharmony
PUTRAJAYA: The Home Ministry would act if the writings
by individuals could create disharmony in society or a negative situation in the country,
said Minister Datuk Seri Dr
Ahmad Zahid Hamidi (pic).
He said the ministry would
be at the forefront of efforts to
prevent such a situation from
occurring.
“But if that happens and we
take action, don’t accuse us of
being cruel as we are upholding the law to prevent chaos in
the country ... that is the duty of
the ministry and its agencies,”
he said in his new year message
at the ministry’s monthly assembly here yesterday.
Ahmad Zahid said some
writings deliberately contained
lies and baseless accusations
to create disharmony and such
a situation was favoured by
certain quarters, more so if the
accusations involved the Home
Ministry.
SUHAIMI YUSUF
“People in the ministry will
read and study the words used
in the writings and it will act if
the news reports or writings
could create an adverse situation in the country.
“We don’t want this country
to be in turmoil and the ministry is at the forefront in preventing this from happening.”
Ahmad Zahid advised the
ministry’s personnel to be
steadfast and not to be afraid
in carrying out their task of
maintaining peace and harmony in the country, although
they were often wrongly accused and portrayed negatively
in some writings.
He said in the era of a borderless world, the ministry
and its agencies’ staff should
recognise the emergence of
the “spinning” culture, where
accusing and defaming others was an enjoyment for the
perpetrators.
“Not everyone is happy with
our work, not all feel protected
and often only bad things are
written about our work. But we
must remember that criticism
and baseless accusations come
with the job.”
He said such accusations
might be made with the support or on the instigation of
certain quarters to divert attention from the actions taken
by the ministry. — Bernama
14 H O M E
Divers battle against nature in hunt for AirAsia debris
SURABAYA: Clinging desperately to
underwater ropes, an Indonesian
search leader said his divers appeared
to be “flying like Superman” as they
scoured the seabed in the gruelling
quest to recover bodies and wreckage from crashed Indonesia AirAsia
flight QZ8501 (pic).
“The current is so strong that it
could rip open our masks or drag us
into a whirlpool,” said Totok Subagio,
in charge of a group that this week
found the plane’s two black box flight
recorders, after a lengthy, difficult
search, AFP reported.
Trained to swim to depths of 45m,
the Indonesian navy’s finest frogmen
were drafted in to scour the seabed
for wreckage of the Airbus 320-200
that went down in a storm last month
en route to Singapore. But in the Karimata Strait between Indonesia’s
Sumatra island and Borneo island,
they have had to contend with rough
seas, powerful underwater currents,
and weather that changes from bright
and sunny one moment to cloudy
and rainy the next.
Grainy images from specialist
Singaporean search equipment on
Wednesday showed the plane body
resting on the seabed, with part of the
Malaysia-based airline’s slogan “Now
Everyone Can Fly” painted on the
red-and-white exterior clearly visible.
Divers now face the grim task of
examining the main body of the aircraft in the hope of finding more of
the 162 victims who were on board
the plane, believed trapped inside
the fuselage. Almost three weeks into
the search, just 50 bodies have so far
been retrieved.
Ferdy Hendarto, head of the navy’s local underwater rescue division,
described how divers would descend
along ropes attached to buoys on the
sea’s surface marking the locations of
the plane’s wreckage.The currents
are so strong they can be dragged
sideways and at times appear to be
“flying like Superman”, he said.
The search has been tough even
for veteran divers, with some suffering
nosebleeds after spending too long
at depths of 30m.
In the hunt for the plane’s two
black boxes, divers equipped with devices able to detect the “ping” signals
emitted by the devices would inch
along the seabed, dropping weighted
markers in areas where they picked
up the signals. Digging at the sandy
sea floor where the boxes were believed buried, diver Rajab Suwarno
succeeded in locating both the recorders, which contain a wealth of
data crucial for determining what
caused the crash.
One of the boxes — which are actually orange in colour and designed
to survive underwater — was trapped
Eight killed as tour bus
plunges into ditch
Most of other passengers injured
TAPAH: Eight people were killed,
seven of them burnt to death, when
a tour bus caught fire after it crashed
into a ditch along the North-South
Expressway near the Tapah toll plaza
early yesterday, police said.
Tapah police chief Superintendent Somsak Din Keliaw said the
seven who were burnt to death were
passengers while the driver died of a
serious rib injury while being rushed
to hospital.
He also said that most of the other
passengers were injured in the accident that happened at 1.15am at
Km326.3 on the south-bound stretch
of the highway after the bus, which
was carrying 30 passengers from Kuala Kurau to Genting Highlands, skidded and crashed into the ditch to the
left when trying to avoid hitting a tyre
Firemen and
rescue personnel
at the scene of
the bus crash
near the Tapah
toll plaza along
the North-South
Expressway, early
yesterday. Photo
by Bomba Twitter
pic
on the road.
Somsak named the dead passengers as women Lim Soo Lan, 59, Aw
Ah Poh, 56, Ong Ah Yook, 58, and
Sin Ah Huat, 54, and men Tan Ah
Ba, 65, Tan Chan Ming, 69, and Tan
Ah Baa, 64. He identified the driver
as M Jayagunasgaran, 40.
The bodies of the passengers were
sent to the Tapah Hospital while the
body of Jayagunasgaran was sent to
the Raja Permaisuri Bainun Hospital in Ipoh.
Somsak said the injured were
treated as outpatients at the Tapah
Hospital before being sent for further treatment at the Raja Permaisuri
Bainun Hospital and private hospitals in Ipoh.
“It is believed that the accident
happened after the bus driver tried
to avoid hitting a tyre on the road,
causing the bus to crash into the ditch
on the left and catch fire,” he said.
The bus, belonging to LBS Travel
and Tours, was ferrying the 30 passengers from Kuala Kurau to Genting
Highlands, he said.
Perak Health, Public Transport,
Non-Muslim Affairs, National Integration and Chinese New Villages
Committee chairman and Chendering state assemblyman Datuk Dr
Mah Hang Soon visited the injured
at the Tapah Hospital. — Bernama
under the remains of the aircraft,
making it more difficult to retrieve.
He described finding one of the
boxes: “That morning the sunlight
was penetrating the water, it was very
clear. We moved some small debris
aside and dug in the white sand —
and, thank God, we found it.”
In a related development, PT Indonesia AirAsia has admitted that
it committed administrative negligence” when it requested for a change
in its four-times-a-week Surabaya
to Singapore flight schedule, the Jakarta Post reported. According to
Indonesia AirAsia president director
Sunu Widyatmoko, the company had
only verbally informed the transportation ministry about operating the
route on Sundays. “I admitted that
administrative negligence occurred
when requesting the change in flight
schedule, as the verbal information
failed to reach the ministry,” Sunu
said. — Agencies
Blogger ordered
to pay damages
for defamation
PUTRAJAYA: A lawyer won his
defamation suit against a blogger who was ordered by the
Court of Appeal here yesterday
to pay damages to him.
A three-member panel comprising Court of Appeal judges
Datuk Abdul Aziz Abdul Rahim,
Datuk Tengku Maimun Tuan
Mat and Datuk Abang Iskandar
Abang Hashim found that three
articles posted on the website
www.papagomo.blogspot.com
were defamatory to Datuk Sukri
Mohamed.
The court allowed Sukri’s
appeal to overturn the High
Court’s dismissal of his civil
suit against Wan Muhammad
Azri Wan Deris, 31.
Abdul Aziz, who chaired
the panel, ordered the case to
be remitted back to the High
Court in Kota Baru, Kelantan
for assessment of damages. In
his decision, he said the High
Court had failed to consider the
evidence of witnesses who had
identified Wan Muhammad
Azri as the blogger, “papagomo”.— Bernama
Taiwan donates more to flood relief efforts
BY HA L I M YA ACO B
KUALA LUMPUR: Taiwan yesterday
made a US$100,000 (RM356,000)
donation in support of various flood
recovery efforts made by the people and government of Malaysia.
Jeffery Kau, the acting head of
mission and representative at the
Taipei Economic and Cultural Office in Malaysia expressed his sincerest condolences and sympathies
to the victims and families of the
victims of last month’s floods during the cheque presentation ceremony here.
At the press conference, Kau said
when his office first heard of the ter-
rible news of the floods, considered
to be among the worst in the history, they contacted several Malaysia
agencies and asked them if there was
anything “we could do to assist the
rescue and relief efforts”. “We also
immediately donated RM10,000 to
related NGOs (non-governmental
organisations) to aide their rescue
and relief works. Later my office assisted the expert flood-relief teams
dispatched from Taiwan, which comprised 31 rescue experts, to go to the
worst-hit areas in Malaysia to assist
the rescue efforts.”
“In the meantime, the Malaysia
chapters of Taiwan Buddhist Tzu
Chi Foundation and Fo Guang Shan
(Buddha’s Light Mountain) also dispatched rescue workers to worst-hit
areas to assist in rescue and relief
works.”
The Taipei Economic and Cultural Office in Malaysia then donated
RM5,000 to Fo Guang Shan and Buddhist Tzu Chi Foundation respectively for purchasing relief goods.
Minister in the Prime Minister’s
Department Datuk Seri Dr Shahidan
Kassim, the Prime Minister’s Special
Envoy to East Asia Datuk Seri Tiong
King Sing were on hand to witness
the donation.
Tiong said the Taiwan Buddhist
Tzu Chi Foundation had also donated more than 30 tonnes of instant
(From left) Taipei Investors’ Association in Malaysia honorary president Datuk Dr Ting
Chung Cheng, Kuala Lumpur branch president Chang Yuang Chuan, Chiang, National
Security Council deputy-secretary Ogu Salim Omar, Shahidan, Tiong and Kau at the
cheque presentation ceremony in Kuala Lumpur yesterday.
rice and 1,008 rollaway beds as relief supplies.
Shahidan said he has solid proof
of illegal logging and land-clearing
activities in Gua Musang, one of the
causes for the heavy floods in Kelan-
tan recently. In addition, the Taipei
Investors’ Association in Malaysia
made a RM50,000 donation to the
Malaysian government for flood relief work. Its president Datuk Allen
Chiang made the donation.
16 H O M E
Muhyiddin: No ruling on wearing of baju kurung
BY JAMILAH KAMARUDIN
PUTRAJAYA: Schools have been
warned not to come up with rules
that are not in line with the Education Ministry’s directives, following
a case in Kuala Lumpur in which
a non-Muslim student was barred
from attending class because she
was wearing a baju kurung.
Education Minister Tan Sri Muhyiddin Yassin said that no rules
have been issued to any school
administration barring non-Muslim students from wearing the baju
kurung.
“Schools, don’t enforce rules
that are not orders or regulations
that can cause other problems,”
the deputy prime minister told a
press conference in Kuala Lumpur
yesterday.
According to reports, the Sarawakian student was told by the
authorities of a school in Cheras
that she would have to wear a pinafore instead of a baju kurung as
she is a non-Muslim.
The Form Three student was
sent home for failing to comply
with the school ruling that only
Muslims are allowed to wear the
traditional Malay costume.
Muhyiddin said there is nothing
wrong with non-Muslims wearing
the baju kurung as the traditional
Malay dress for women is by now
regarded as a national dress.
He urged the school concerned,
SMK Seri Mutiara in Cheras, to rectify its dress code to avoid turning
the problem into a racial one.
“I don’t think it is right. The ministry will ask the school to correct
this because a matter like this has
now become construed as a racial
problem.
“We don’t want to make it racial.
‘Single-stream schools
not the key to unity’
Malaysians should focus on achieving unity in diversity, says academic
Shamsul: When you talk about
unity in uniformity in Malaysia, it is
impossible because we don’t have the
same ethnicity.
BY A NI SA H SHU KRY
KUALA LUMPUR: Malaysians asking for a single-stream school system should give up on the idea as
the country will never be united
in uniformity, a prominent social
anthropologist told a forum on
Wednesday.
Datuk Dr Shamsul Amri Baharuddin, the founding director of the
Institute of Ethnic Studies, Universiti Kebangsaan Malaysia (UKM),
said Malaysians should instead
focus on achieving unity in diversity because espousing uniformity would only sabotage efforts to
pursue unity.
“When you talk about unity in
uniformity in Malaysia, it is impossible because we don’t have
the same ethnicity, [for instance]
not everyone is Muslim. We don’t
have that. We begin with unity in
diversity.
“But the dream that we still hold,
or some people in this country are
holding on to, is that we [should] have
unity in uniformity. But that can’t
happen ... these are the people who
feel that one school [stream] only is
needed in this country,” he told reporters after speaking at a forum on
human development at UKM Bangi.
Shamsul pointed out that multiple school streams existed during
the British rule of the country and
this has never changed.
He said this shows that Malaysian society has been grounded on
the “unity in diversity” model since
the colonial era, and it has become
the backbone for social cohesion
since Merdeka.
“We have never changed the
structure. How can we [work towards] unity in uniformity when
the structure is not unity in uniformity? I think this is something
people don’t realise because it is
too philosophical.
“It can also become emotional
because people want to be emotional as they want to win votes or
win support,” he said.
However, Shamsul said that even
after 40 years, Malaysia is not actually united, whether in diversity
or uniformity, and he doubts unity will be achieved within the next
20 years.
“We have achieved cohesion,
where we agree to disagree. But
we have not reached unity. We are
moving towards it.
“Unity is when people feel that
they belong together, where they
have a shared history,” said Shamsul.
Several right-wing groups and
Umno leaders have in the past
called for vernacular schools to
be abolished, saying they hinder
national unity.
In November, a coalition of over
300 Malay non-governmental organisations, including Perkasa, said
the current school system creates
“racial, religious and cultural polarisation and threatens national
unity”.
The groups urged Putrajaya to
use the threat of deregistration on
any “radical” education groups that
fight for vernacular schools. — The
Malaysian Insider
Schoolbus fares up 10% to 20% despite cheaper fuel
KUALA LUMPUR: Hikes in schoolbus fares of between 10% and 20%
will kick in immediately despite the
drop in pump prices for diesel fuel,
a local daily reported yesterday.
It quoted the Federation of Malaysian Schoolbus Operators Associations as saying the hike is necessary
to cope with rising maintenance
costs for their vehicles.
Federation president Amali Munif Rahmat said the last increase
was five years ago, and that the drop
in fuel prices did not benefit them
as operating costs had gone up by
100%.
Calling it a “do or die situation”,
Amali said some operators are turning to illegal transporters to save on
licence fees and insurance costs.
“The cost of operating a schoolbus has shot up by 100%. Compare
that to the savings in diesel cost,” he
told the daily.
Since 2009, under the Commercial Vehicle Licensing Board’s fare
scheme, schoolbus services in urban
areas charge RM27.43 for the first
kilometre and RM2.05 for every subsequent km. The fare is lower in rural
areas, RM20.62 for the first km and
RM2.02 for every subsequent km.
Amali said the financial aid provided by the government to replace
old schoolbuses is not enough, adding that the Japan-assembled buses
cost at least RM300,000.
He said government assistance
only covers half the amount, adding that securing financing for new
buses is difficult for operators because they either have existing loans
to service or do not earn enough to
pay the monthly instalments.
He urged the government to consider subsidising schoolbus fares,
as most children come from lower
income households.
The report quoted schoolbus operator Abdullah Mat Zin, 57, from
Teluk Mas Melaka, who said he increased his fare by only a few ringgit
this year, but some parents chose to
go with illegal operators.
Federation secretary Md Saad
Mohamad said those who opt for
illegal operators are putting their
children at risk.
There are approximately 17,500
schoolbus operators nationwide,
while the federation reportedly represents about 10,000 members in
37 associations. — The Malaysian
Insider
Schoolbus operators say they cannot
afford to replace their old vehicles as
they cannot meet monthly instalments
despite government aid. Photo by The
Malaysian Insider file pic
It may just be a misunderstanding or a decision made that is not
in line with the ministry’s stand,”
Muhyiddin said.
The Form 3 student, Britney
Nicole, is a Lun Bawang native
from Sarawak and was reportedly
barred from entering the school
because she had broken its dress
code that said only Muslim girls
can wear the baju kurung. — The
Malaysian Insider
In a Kedah
madrasah,
students told
to follow slain
jihadist
KUALA LUMPUR: A new video
by the New York Times (NYT)
has tracked the life of slain Malaysian jihadist Mohd Lotfi Ariffin, who died last September
fighting alongside militants in
Syria. The Jihadist in Our Family
features the religious teacher and
former PAS member’s journey
from his hometown in Kedah,
where he had opened a madrasah with his brother Mohd Zainol
Ariffin, to Syria where he joined
dozens of other Malaysians in
the rebellion against President
Bashar al-Assad.
In the nine-minute video,
Mohd Zainol, 53 was shown telling his students to follow in the
footsteps of his slain brother, who
had also taught at the school.
“People wonder why our religious teacher, who seemed so
gentle, was willing to wage jihad
for Allah in Syria. That he was
willing to leave his children and
wife,” he said in the video. “As
students, we should follow the
path of our teacher Mohd Lotfi.”
Lotfi, the former Kedah PAS
Youth information chief, courted
controversy last June when he
disclosed his involvement in the
Syrian civil war. He was sacked
from PAS after it said it did not
condone or encourage members
to join armed movements.
The NYT noted that the father
of six was also active on social
media in documenting his journey — “posting photographs and
videos from Syria, some lighthearted travelogues and other
posts depicting the gruesomeness of the war there”.
Students and followers at the
madrasah, the NYT observed,
seemed taken in by Mohd Zainol’s
sermon. “If we want to go to heaven, we must die an honorouble
death,” student Yusran Budiman
told the NYT. “One of the easiest
ways is to die a martyr. Personally,
I would like to die a martyr.”
Principal assistant director of
the Counter Terrorism Division
of the Special Branch at Bukit
Aman, SAC Datuk Ayub Khan
Mydin Pitchay, told the NYT that
Lotfi’s “charisma” was one factor
why his followers were drawn to
go to Syria to join him. At least
six Malaysians were reported to
have died in Syria and Iraq with
Isis. — The Malaysian Insider
18 C O M M E N T
No more excuses for Draghi
Possible legal obstacle to QE cleared by EU Court of Justice
BY THE ED I TORS
F
or months, European
Central Bank (ECB)
president Mario Draghi
has hinted that he’s
ready to announce a
full-blown programme
of quantitative easing (QE). Yesterday, the EU Court of Justice’s (ECJ)
advocate general cleared away a
possible legal obstacle. With prices in the euro area now falling, any
further delay would be inexcusable.
The eurozone has gone from
bad to worse, and it is dragging the
world economy down with it. The
World Bank just slashed its 2015
growth forecast for the euro area to
1.1%, down from June’s estimate of
1.8%. The forecast for global growth
was cut to 3% from 3.4%. Europe’s
economies desperately need an
injection of demand, and the ECB
can deliver that with QE.
Yesterday’s legal finding said
that ECB purchases of sovereign
debt are permissible. It referred to
an existing ECB programme called
Outright Monetary Transactions
— which isn’t quite QE but which
does involve purchases of government bonds. The court won’t rule
for another four to six months, but
it’s likely to follow the advocate
general’s guidance. That’s good
enough for Draghi to act now.
See related story on Page 19
Many in Europe, especially in
Germany, remain opposed. They
see QE as a ruse by which the richer
members of the currency bloc will
end up paying for the fiscal misadventures of their neighbours. They
point out that Europe’s single-currency treaty forbids “monetary
financing of the member states”.
Hans-Werner Sinn, head of Ger-
Sinn this week accused the
ECB of scaremongering
about deflation.
many’s highly regarded Ifo economic institute, this week accused
the ECB of scaremongering about
deflation to justify bailing out the
weaker economies.
These reservations are understandable, but when the treaty was
drawn up, nobody envisioned a recession as severe as the one Europe
now finds itself trapped in. This is
an economic emergency, and exceptional measures are needed.
The US Federal Reserve has
shown that QE can provide needed
monetary stimulus when interest
rates cannot be cut any further. No
plausible alternative presents itself.
The new legal finding isn’t as
permissive as it should have been.
It opposes bond buying in the so-
called primary market, restricting
the programme to secondary-market purchases of existing securities.
That’s a pity, because it narrows the ECB’s options. The finding, again needlessly, warns about
price distortions resulting from the
ECB’s holding on to bonds until
they mature. But its main point —
that monetary policy should be for
the ECB rather than the courts to
design — is wise.
There’s a risk that, despite this
green light, the ECB will still act
too cautiously. The ECB’s balance
sheet has grown by about 10% since
the bank started purchasing asset-backed securities in October,
and stands at €2.2 trillion (RM9.18
trillion).
The Fed’s balance sheet recently
topped US$4.5 trillion (RM16.02
trillion). Draghi has talked about
the need for an expansion of €1
trillion; the options studied by policymakers earlier this month were
limited to half that amount.
The next ECB meeting is on Jan
22. Markets expect Draghi to act.
Anything short of an open-ended
commitment to buy government
debt in impressive quantities will
disappoint investors and worsen
the euro area’s plight. — Bloomberg View
Diversification, a bet on human ingenuity
BY JAMES SAFT
TO diversify investments is to bet
on, rather than against, human
ingenuity.
Diversification is a bet on human
ingenuity, but made in a humble
way which wants to capture a fair
share of ingenuity in aggregate rather than a huge share of advances
in particular.
Investment guru Dylan Grice
once said that investing in commodities was a bet against human
ingenuity. His point, most recently illustrated by the plunge in the
energy markets, was that investors were wrong to expect a real
risk premium from an asset class
whose prices should be expected
to decline in real terms over the
long term.
Human beings figure out a better
way to create commodities more
cheaply or to obtain more of them
than previously thought possible,
fracking being but one example.
That caps price gains and makes it
hard to profit over the longer term.
Better, under the circumstances,
to try to capture the benefit of that
ingenuity, usually by investing in
equities, which give holders unlimited upside to benefit from a
better, cheaper drilling apparatus,
cell phone or mousetrap.
There are basically two approaches to this strategy: to be discerning, or to be humble.
The first way, historically far
more popular and definitely far
more fun, is to try to discern which
technologies will displace which
business models and then invest
accordingly.
There is much to be said for this,
after all.
A well-diversified
portfolio is
positioned to
benefit from those
innovations in
aggregate, earning
a modest but less
volatile return.
First, if you get in early and correctly you can make a fortune. Figure out that America is going to
want to drink individual cups of
coffee made with little capsules (an
idea I found hilarious at first) and
you might be an early investor in
Keurig, now part of Keurig Green
Mountain, the wonder stock of the
most recent decade. Everybody,
well almost, has an uncle who almost bought McDonald’s at 30 US
cents in the 1960s.
This is also, besides potentially
greatly enriching, a lot of fun. It
is immensely satisfying to be the
stock picker who figures out how
the future is going to break.
This makes us feel that, rather
than simply being rentiers exchanging our capital for a return, we too
are innovators improving the lot of
mankind with our capsule coffee.
Scientists, almost.
I am convinced that much of
the mysterious appeal of active
fund management and its bad twin,
hedge funds, is that they make the
client feel clever.
The irony here is that though
you may have decided that you
want to bet on human ingenuity,
as a stock or fund manager picker
you’ve decided that the way to do
that is to rely on the judgement of
one person: you.
You can use all the gate keepers you want, but ultimately you
are choosing to delegate the
technology picking to someone
else. Why you might believe that
you are well suited to make this
choice, other than the fact that
you happen to have assets, I cannot say.
The alternative is to accept that,
on the evidence, people are good
at innovating and that these inno-
vations will increase output and
living standards.
But just as ingenuity makes fortunes, so it destroys them, eating
the lunch and profit margins of
those businesses whose operating
models are displaced.
A well-diversified portfolio is
positioned to benefit from those
innovations in aggregate, earning
a modest but less volatile return.
It isn’t necessary to work out
that the Erie Canal will kill the businesses of some eastern farmers or
millers, or that the railroads, less
than a generation later, will do the
same to the Erie Canal and some
of its beneficiaries.
Given that the Internet is so revolutionary, the stock picking way
is particularly tempting, but if the
innovation is more groundbreaking,
more lunches are going to be eaten.
WhatsApp looks like a revolu-
tion, and so it may be, but it is very
hard to gauge both how sustainable
and profitable it will be and whose
profits it will eat. Better instead to
take a modest premium from a
more efficient, better connected
world.
Diversification works two ways:
giving you exposure to innovation
while making sure you don’t get too
badly hurt by its collateral damage.
That’s even before we consider
the ways in which diversification,
one of the only free lunches of the
investment world, allows for better
risk-adjusted returns.
Have faith in the future, but be
humble enough to understand you
have little specific idea what that
means. — Reuters
James Saft is a Reuters columnist.
The opinions expressed are his own.
F E AT U R E 1 9
India’s rate cut is first
of several this year
European court
opinion gives
QE a helping
hand, with
conditions
BY N E IL UN MAC K
Headroom seen for a shift in monetary policy stance
BY A N DY MU KHERJE E
R
aghuram Rajan’s first
rate cut is just one of
the several that investors will expect from
India’s central bank
governor this year.
The quarter-percentage-point decrease won’t revive a sluggish economy overnight. But the unscheduled
decision announced on Jan 15 is not
a one-off. As Rajan said in his statement, he now has the “headroom for
a shift in the monetary policy stance.”
Falling energy prices are a big
help. The Reserve Bank of India’s
(RBI) target of 6% inflation by January 2016 is already in the bag, and
unlikely to slip out again. What’s
skidding, though, is growth: industrial production is stagnant.
the RBI’s credibility as an inflation
hawk. Consumer prices rose just
5% in December, a far cry from
the double-digit inflation the former International Monetary Fund
chief economist inherited when he
took up the job in September 2013.
Back then, investors were punishing India for its high inflation,
wayward government spending,
and wide current-account deficit.
Rajan raised the policy rate and
squeezed domestic demand to
wring out inflation. He also gave a
clear message to the new government in New Delhi that monetary
rewards would depend on stricter
budgetary discipline.
Rajan has already reestablished the
All those goals have been met.
RBI’s credibility as an inflation hawk.
The government is keeping a tight
lid on public expenditure, and has
Keeping the policy rate at 8% would broken away from the past practice
have been ill-advised.
of paying farmers overly generIt would also have achieved lit- ous prices for staples. Rural wage
tle. Rajan has already reestablished growth — a big driver of inflation in
India — has turned sharply lower.
Finally, the risks to India’s financial stability from lowering rates are
currently low. Long-term interest
rates in advanced nations are falling. A repeat of the mid-2013 “taper
tantrum”, when the country saw
large capital outflows, is unlikely
even if short-term US rates rise
later this year.
See related story on Page 22
If anything, lower borrowing costs
will allow Indian companies to revive some of the large infrastructure
projects they have abandoned. That
would also help the banking system.
Rajan has put the ball in the government’s court. Investors will now
want to see a strong reform push
in the upcoming federal budget,
followed by more rewards from
the central bank — in the form of
more rate cuts. — Reuters
Experiment looks less like McDonald’s
THE Corner, a new cafe in Sydney’s
trendy inner west, looks a lot like
its peers — white frontage, rustic
wooden seating, potted plants on
the counter, quinoa on the menu
and servers wearing hemp aprons.
But look a little closer at the
black name sign over the door and
a visitor will see “McCafe, established 2014” scrawled in small type.
Owner McDonald’s Corp’s is saying little about the unique cafe and
a series of other “learning labs” it is
opening in Australia. They include
a typical McDonald’s restaurant
on the outskirts of Sydney that,
in addition to its usual fare, offers
“build your own” burgers and table service.
But market experts say they indicate McDonald’s is seriously worried about tough competition from
so-called fast-casual chains around
the world that offer healthier food
choices and more sophisticated service such as private equity-owned
Nandos, Shake Shack Inc and local
chains Grill’d and Mad Mex. The
fast-casual segment is outgrowing
the fast-food sector.
“McDonald’s globally are going through a transition,” said Rohan Miller, a business academic at
Sydney University, who produces
studies on the fast-food market for
commercial groups.
“This is clearly a soft launch being quietly managed and I imagine
there’ll be some tweaking to the
concept as they get more experienced.”
McDonald’s would only say it
had no plans to roll out The Corner nationally, but acknowledged
some of the food and concepts it is
People standing at the counter of The Corner cafe in Sydney in this handout picture
made available to Reuters on Jan 13. Photo by Reuters
trialling may be adopted elsewhere.
“While we don’t have plans at
this stage to roll out The Corner
concept nationally, it will be used
to gauge customer feedback to enhance the offering in our McCafé’s
around the country,” Chris Grant,
corporate communications manager for McDonald’s Australia, said
in an email. “Products and concepts that our customers love may
be included in other restaurants.”
Offerings at The Corner include
Moroccan roast chicken breast and
chipotle pulled pork and personalised salads of brown rice, lentil and
eggplant. Tea and coffee orders are
delivered, using crockery, direct to
your table.
At the more traditionally styled
Castle Hill McDonald’s outlet, in the
outer suburbs, “build your own”
burgers are presented on wooden
boards and fries in a basket. They
are offered alongside menu sta-
ples such as Big Macs and Quarter
Pounders.
McDonald’s has around 930 restaurants in Australia, from which it
serves around 1.7 million customers a day — a sizeable chunk of the
23.5 million population.
McDonald’s arch rival, Yum
Brands Inc, is also branching out.
The owner of the KFC brand has
applied for a licence to serve beer
and cider at a Sydney store, following two pilot projects in Canada
last year.
McDonald’s is Australia’s most
popular fast-food restaurant, or
Quick Service Restaurant (QSR),
followed by Subway and KFC.
Around 42% of Australians visit
an outlet each month, Enhanced
Media Metrics Australia says.
Still, moves toward healthier
eating are slowing revenues for
fast-food burger shops in Australia. Annualised growth of 1.2% to
US$4.1 billion (RM14.59 billion)
over the five years to 2014/15 includes a 0.1% decline in the final
year, according to business research
group IBISWorld.
And globally, the fast-casual sector which includes Chipotle Mexican Grill Inc and Panera Bread Co,
is growing more rapidly, led by the
United States, where sales growth
of 13.2% in 2012 outpaced 4.6% for
quick-service outlets, according
to research and consulting firm
Technomic.
McDonald’s does not break out
financial results per country, but
Global Media Relations director
Becca Hary said Australia was a
positive contributor in November 2014.
Global sales at restaurants open
at least 13 months, however, were
down 3.3% in the third quarter, and
fell 1% for the first nine months of
2014. Expectations for the company’s fourth-quarter results, due
later this month, are low.
That’s a sharp contrast with
Shake Shack, which earlier this
month filed for an initial public offering as it plans to expand its locations beyond its New York base. Investors and analysts are bullish on
its prospects, saying there is room
for more fast-casual restaurants
that offer higher-quality burgers,
a variety of toppings and, in some
cases, beer and wine.
“The changes afoot from consumers are very apparent,” said
Retail Doctor’s Walker. “There’s a
growing market that doesn’t want
to eat in plastic chairs at plastic
tables in a plastic environment.”
— Reuters
THE European Court of Justice
(ECJ) is giving quantitative
easing (QE) a helping hand. Its
advocate general has blessed
the principle of European Central Bank (ECB) government
bond-buying, with few conditions attached. That provides
cover for the central bank’s
quantitative easing plans —
and will do little to soothe German opposition to the ECB’s
policies.
The European court opinion on the legality of Mario
Draghi’s 2012 crisis-prevention
tool, the outright monetary
transactions, looks like an odd
relic. The Outright Monetary
Transactions (OMT), a plan
to buy the sovereign debt of
countries locked out of markets once they sign up to a
bailout, has never even been
used, and is unlikely to be if
the ECB does follow suit on its
plan to deploy more massive
systematic bond-buying.
Yet the ruling of the ECJ,
which often follows its advocate general, will matter because it will help set the legal
framework for the eventual
ECB quantitative easing programme.
The legal dispute, triggered
by a lawsuit of German academics opposed to the ECB’s
policies, comes down to two
questions: whether the ECB
would be exceeding its monetary policy mandate by buying
government debt, and whether
it would break European rules
against funding governments
by exposing itself to potential
losses.
The opinion basically approves Mario Draghi’s plans,
subject to some mild restrictions. It leaves the ECB the
flexibility it needs. The central
bank could, for example, be
treated as other bondholders in a restructuring. More
broadly, the opinion steers
clear of intruding too closely
on monetary policy.
The move reduces one potential risk for the ECB. But it’s
not a green light. If the ECJ follows the ECB’s advocate general’s line, the German constitutional court would find itself
in an odd situation.
In its February 2014 ruling,
the Karlsruhe judges made
clear they thought the ECB was
acting outside its remit. If they
don’t agree with the ECJ’s legal
reasoning, they could in theory instruct the German Bundesbank not to cooperate with
the bond-buying programme.
Even avoiding that extreme
outcome, the ECJ’s preliminary opinion will do nothing
to assuage German fears that
monetary policy in the eurozone is running out of control.
— Reuters
2 0 P R O P E RT Y
IOI Prop’s Bandar Puteri
Catering to the growing demand for affordable housing
BY L I M KI A N WEI
BANGI: Phase 1 of IOI Properties Group Bhd’s
RM4 billion Bandar Puteri Bangi township
has achieved a take-up rate of 70% since its
launch last weekend.
The first phase comprises Almyra Residence serviced apartments, The Terresse
terraced houses and Kubica Square shop-offices.
“[The residential properties within the
township] will cater [to] the growing demand
for affordable housing [following] the recent
spike in property prices within the Klang
Valley. [It] will fulfil the needs of first-time
homebuyers, young professionals, singles,
early nesters, upgraders and investors within
the Kajang-Bangi-Semenyih area,” said the
senior central marketing executive of IOI
Properties Ling May Yuen.
The freehold mixed-use township development covers 370 acres (150ha) and
is adjacent to the Putra Mahkota toll. It is
expected to be completed over the next 8
to 10 years.
According to the senior sales and marketing manager of IOI Properties Mohd Ezuddin
Samian, the development is strategically located between Kuala Lumpur and Seremban
and is 30 minutes away from both cities. The
township is accessible via the North South
Expressway (NSE) and the Kajang Seremban
Highway (Lekas).
Almyra Residence features 669 units of
apartments spread across four blocks. Each
block will have 25 to 30 storeys. There will
be three types of apartments — three bedrooms two bathrooms; three bedrooms
three bathrooms; and four bedrooms three
bathrooms — with built-ups between 969
sq ft and 1,217 sq ft. The units have a ceiling
height of 3.3m. Prices range from RM360,800
to RM707,800 and completion is scheduled
for November 2017.
The Terresse comprises 111 units of 2-storey terraced houses with a built-up of 2,510
sq ft. Prices range from RM728,800 to RM1.35
million. The terraced houses are expected
to be completed by November 2016.
Kubica Square comprises 116 units of
The township is located 30 minutes
away from Kuala Lumpur and
Seremban. Photo by IOI Properties
3- and 4-storey shop-offices. With built-ups
ranging between 5,237 sq ft and 17,465 sq
ft, units are priced between RM1.526 million and RM4.85 million. The shop-offices
will have 1,045 public parking bays and are
expected to be completed within 2½ years.
The township will offer amenities such
as the ecoOasis Clubhouse and arenaOasis
Parkland, which are expected to be ready
in three years. Other amenities include the
Bangi Gateway Shopping Complex, universities, commercial hubs, government agencies and hospitals. A Tesco hypermarket is
also expected to be opened in the area in
approximately two years.
Ling told The Edge Financial Daily in an
email in December last year that the group
has approximately 1,000 acres of land in
Ayer Keroh, Melaka. It is to be built into a
township in the future which will comprise
commercial and residential developments
with common facilities and amenities at a
development cost of RM4 billion.
Ezuddin said the group’s project in
Sepang, known as Bandar Puteri Warisan,
is expected to have two phases of its development completed within two years. This
mixed-use development is located 5km
from klia2 and 1km from the Salak Tinggi
Express Rail Link.
AUCTION
Property type: 2-bedroom serviced apartment
Address: D-07-13, Block D, Pacific Place Commercial Centre, Jalan PJU 1A/4, Ara Damansara,
Property type: Shop unit
47301 Petaling Jaya, Selangor
Address: 7 Jalan AU 1A/4E, Taman Keramat Tenure: Leasehold
Permai, 54200 Kuala Lumpur
Reserve price: RM459,000
Tenure: Leasehold
Transacted price: RM480,000
Built-up: 864 sq ft
Transacted price: RM580,000
Auctioneer: Ehsan Auctioneers Sdn Bhd
Built-up: 1,380 sq ft
Contact: (03) 2161 6649
Contact: (03) 2161 6649
Contact: (03) 2161 6649
Property type: Shop office unit
Address: 27 Jalan PS 8, Prima Selayang, 68100
Batu Caves, Selangor
Tenure: Leasehold
Reserve price: RM1.55 million
Transacted price: RM1.6 million
Land area: 1,916 sq ft
Contact: (03) 2161 6649
Auction date: Jan 29
Property type: 2-storey semi-detached house
Address: 292 Jalan Kemuning 10, Taman Kemuning, 70450 Senawang, Seremban, Negeri Sembilan
Tenure: Freehold
Land area: 3,713.45 sq ft
Auctioneer: Property Auction House Sdn Bhd
Contact: (03) 2070 2226
Sold
Up for bid
Property type: Corner office unit
Address: Suite C-20-3, Level 20, Block C, Megan Avenue II, 12 Jalan Yap Kwan Seng, 50450
Kuala Lumpur
Tenure: Freehold
Reserve price: RM1.08 million
Built-up: 3,520 sq ft
Property type: 2-storey semi-detached house
Address: 6 Jalan Alam Suria 16/28, Section
16, 42300 Bandar Puncak Alam, Selangor
Tenure: Leasehold
Land size: 1,916 sq ft
Contact: (03) 2161 6649
India office
market to enjoy
better occupancy
rate despite
challenges ahead
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BY Z AT IL H US N A WA N FAUZ I
INDIA: The occupancy rate of the office
market in India is projected to “considerably increase” in 2015 and 2016 compared
with 2012 and 2013, despite challenges
ahead, according to Jones Lang LaSalle
India’s (JLL India) recent India Office Real
Estate Market Review 2014.
“We expect only 22 million sq ft of office space to be ready at the right locations
against the demand forecast of 30 million
to 32 million sq ft in 2015. Therefore, rental
and capital values will continue to grow,”
said chief operation officer Ramesh Nair.
“Investment volumes are expected to go
up in 2015, driven by low-risk, cross-border capital. Overall, the investment market
will do better in 2015, with a substantial
weight of capital targeting office real estate
(especially Grade A and trophy assets).”
Ramesh attributes the lower vacancy
levels in the office market to efforts and
market research undertaken by the new
Indian government targeting reforms in the
right industry such as real estate, mining,
manufacturing, and infrastructure, which
indirectly triggers growth for a multitude
of ancillary and supporting industries.
“With the renewed confidence, the
Indian economy is operating at a speed
where current year 2014 and 2015 growth
is expected at not below 5.5% year-onyear (y-o-y) ... Inflation has ceased to pose
challenges to growth, which is positive. All
this led to the Indian office market having
the second best year ever other than 2011
in terms of absorption and the lowest vacancy levels since late 2009,” Ramesh said.
Pan-India office space vacancy dropped
from 18.5% as at end-2013 to 16.9% as at
end-2014. Mumbai, Chennai and Pune
were responsible for this steep fall in vacancy during the year. “While limited supply was helpful in reducing vacancy in
Mumbai and Chennai, Pune benefited
from moderate supply and healthy growth
in absorption. Despite a significant rise in
supply in Bangalore, a healthier absorption
resulted in reduced vacancy. The current
vacancy levels in Mumbai are the lowest
seen over the last 36 months.” The report
says demand for office space increased
by close to 30 million sq ft in 2014, a three
million jump in net absorption compared
with the previous year. The absorption
rate for Bangalore rose 72% y-o-y in net
absorption in 2014, followed by National
Capital Region (NCR)-Delhi (48%), Hyderabad (41%) and Pune (13%) while Kolkata (-55%), Chennai (-43%) and Mumbai
(-21%) saw a fall in net absorption.
The improved economic outlook in
the United States, strengthening domestic capital markets and the government’s
bold efforts to boost the manufacturing
sectors are among the reasons these sectors outperformed the others in terms of
leasing, said Ramesh.
According to the report, the total stock
of Grade A office space across major Indian cities grew 8% y-o-y with an additional
supply measuring below 30 million sq ft.
“Bangalore saw the biggest addition ... in
absolute area terms, followed by NCR-Delhi. Mumbai, Pune and Hyderabad saw
moderate increases ... Chennai and Kolkata added very little supply ... during the
year,” said Ramesh. Pune, Bangalore, and
Kolkata saw the highest rental increases of
8.6%, 5.2% and 4.2%, respectively. Rentals
in other markets remained stable.
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P R O P E RT Y 2 1
HOT DEALS
Newpark will be
the first ecofriendly real estate
development
in central
Johor. Photo by
Majupadu
How much is your property worth?
Which and what property has just been
sold, and for how much? What interesting
buys are now on the market? Check out
the following Hot Deals of the week.
Go to www.theedgemarkets.com for more.
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Majupadu previews Newpark in Kluang
BY ZAT I L H U SNA WAN FAUZI
KLUANG: Majupadu Development Sdn Bhd,
a Kluang-based property developer, has announced the development of Newpark, the
first eco-friendly real estate development in
central Johor.
“Newpark represents an opportunity to
upgrade Kluang. Newpark will be the largest
master-planned commercial project in Kluang,”
said Majupadu founder and managing director
Tey Ah Kau in a press release.
“The location is very strategic, surrounded by
large, mature housing estates, the Federal Building, the future Inland Revenue Board building
and Intan (Institute Tadbiran Awam Negara).
Access is just 10 minutes from the North-South
Expressway, five minutes to Kluang Mall, and
within a 45-minute drive Newpark will serve a
catchment area of over 700,000 people in the
Kluang and Batu Pahat districts. Within one
hour’s drive is Johor Baru and within two hours
is Singapore,” the statement said.
The 247-acre (100ha) Newpark will include a master-planned commercial zone
which is more than 90 acres in size, located
about 10 minutes’ drive from the NorthSouth Expressway, which can be accessed
via the main road of Jalan Batu Pahat. Majupadu collaborated with Singapore-based
Pomeroy Studio to create a sustainable and
eco-friendly concept for Newpark.
The first phase is scheduled to start in 2015
and will comprise a hotel and convention
centre, high-rise residences, a hypermarket,
an education hub and the city commercial
boulevard shop office area. The timing of the
launches for each component is still in the
planning phase, said the company.
The company also plans to widen Jalan Batu
Pahat to eight lanes from the current four lanes
with a 30m-wide entrance.
“Central to Newpark is the investment in sustainable design and eco-friendly technologies
which will benefit residents and businesses,”
said Majupadu executive director Tey Fui Kien.
“Optimisation of light, ventilation, grey and
rainwater harvesting methodologies and exploration of solar energy will be among some
of the features designed to optimise energy and
water usage in Newpark. It will be Majupadu’s
flagship development for sustainable living in
Kluang,” said Fui Kien.
“We have been able to implement key passive design principles which form the core
of our design process to create sustainable,
eco-friendly and liveable built environments.
Urban greenery and sky gardens form a fundamental part of the design, helping to reduce
ambient temperatures and thus cooling costs.
Intelligent positioning of the buildings helps
to increase natural ventilation while optimis-
ing natural light, further reducing energy use
while improving the overall experience for visitors and guests. These design elements create
minimal impact on the environment yet significantly improve the overall experience for
the delegates, guests and visitors who will use
the complex,” said Pomeroy Studio founding
principal Professor Jason Pomeroy.
Fui Kien said prices and other details are
being finalised.
“We see immense scope for development
in Kluang and have identified certain gaps in
the market. Currently, we continue our discussions with prospective partners for key components such as the hotel, the hypermarket
and the education hub. We will take the time
to review the details and ensure that we bring
in the right partners and the right approach
to the project.
“Majupadu has a strong track record in
Kluang and we have the local knowledge. We
want to bring in operators who can achieve
our vision of uplifting the lifestyle of Kluang
residents. We look forward to harnessing
their expertise with our local market knowledge to deliver the right product and service
mix for Kluang folk. This is our approach in
Kluang Mall and for Newpark. We are constantly talking to prospective partners who
wish to bring new concepts into the market,”
said Fui Kien.
Kasuka Group to launch RM80m Seremban Gateway
BY L I M KI A N WEI
KUALA LUMPUR: Kasuka Group will launch
Seremban’s first street mall — Seremban Gateway — at end-2015. The mall has an estimated
development cost of RM80 million.
“Seremban Gateway will be a landmark for
Seremban when it opens for business in December 2015 as it is located between Seremban
town and Seremban 2. The street mall is conceptualised as a meeting place and food and
beverage (F&B) hub for tourists and travellers,”
Kasuka Group executive director Paul Yap Poh
Lim told The Edge Financial Daily.
The mall comprises 43 retail lots and 200
parking bays. It is located in Jalan Sungai Ujong
in Seremban, which is accessible via the NorthSouth Expressway (NSE).
“Seremban Gateway is planned as a onestop home-furnishing centre. It is well positioned to serve the home-furnishing needs of
41,628 units of incoming residential properties
and 39,714 units of planned residential properties in Seremban [according to the National
Property Information Centre’s Property Stock
3Q2014] as well as owners of 165,789 existing
units of residential properties in Seremban
who wish to upgrade and refurnish their residences,” said Yap.
The mall has a net lettable area (NLA) of
The mall
has a net
lettable area
of 120,000 sq
ft. Photo by
Kasuka
120,000 sq ft and approximately 200,000 sq ft
of gross built-up area. The rental rate for the
lots ranges between RM1.50 and RM10 per sq
ft (psf), while the built-ups range from 1,697 sq
ft to 12,034 sq ft.
Its facilities and services include 24-hour
security, fibre-optic networks, three passenger
lifts and one service lift. The nearby amenities
include KPJ Seremban Specialist Hospital, East
West College, Negeri Sembilan Museum and
the Seremban Komuter station.
The developer intends to allocate 45% of
the mall for home furnishing, 30% for F&B and
25% for convenience and services. It will retain
all the retail shops for recurring rental income
and to ensure that the selection of tenants complement each other. To date, Coffee Bean is the
first confirmed tenant.
Among the group’s future developments
are 23 units of semi-detached shop offices in
G Business Park Seremban with a gross development value of RM40 million. They are priced
at about RM1.7 million and have built-ups of
between 5,907 sq ft and 6,740 sq ft.
Next in the pipeline are two commercial developments, one located near the Seremban toll
at Jalan Labu and the other in Persiaran Senawang Satu (near the Giant hypermarket and
upcoming Mydin hypermarket). The developments are still in the preliminary planning stage.
2-storey terrace in Taman Seri Austin,
Johor
Built-up: 1,893 sq ft; 4 bedrooms; 4
bathrooms; Freehold; RM510,000
This unit is partially furnished with kitchen cabinets and cooking hood. It’s located
within the gated and guarded community of
Taman Seri Austin. The township is about 25
minutes’ drive to Johor Baru and 15 minutes
to Sunway College, Hospital Sultan Ismail
and KFCH International School.
Contact: Heston Lai of Real Estate Finders
(013) 799 0228
On the market
2-storey terrace in Anggerik Doritis,
Shah Alam, Selangor
Built-up: 2,100 sq ft; 4 bedrooms and
3 bathrooms; Freehold; RM730,000
This intermediate unit is within a guarded
and gated community. The unit has been
renovated with an extended kitchen, new
floor tiles and plastered ceiling. It is also
partially furnished with kitchen cabinets,
built-in wardrobes and air-conditioning
units in all rooms.
Contact: Sherlyn Khor of CBD Properties
(USJ) Sdn Bhd (012) 305 5070
WHAT’S
HAPPENING &
WHERE
Launch of Smithfield Square, London N8
Date: Jan 24 and 25
Venue: The Straits, Level 2, Westin Hotel,
Kuala Lumpur
Time: 10am–7pm
Contact: Jazmine (012) 304 6887
JLL Property Services (Malaysia) Bhd brings
Berkeley Group’s Smithfield Square apartments to Malaysia. The project is coming up
in North London.
IOI Properties showcase
Date: Jan 23 to 25
Venue: IOI City Mall, Putrajaya
Time: 10am–10pm
Contact: Call (03) 8947 8899 or log on
to http://www.ioiproperties.com.my/
showcase2015/
IOI Properties Group Bhd will unveil its
EZY Home Package featuring booking fees
of RM3,000 and deferred payments for up
to 36 months.
Launch of Bayu Suria semi-detached
houses in Shah Alam 2, Selangor
Date: Jan 24
Venue: Bayu Suria show house, Persiaran
Puncak Alam 6, 42300 Bandar Puncak
Alam, Selangor
Time: 10am–5pm
Contact: (03) 3393 3103
IJM Land Bhd is launching the final phase
of its Bayu Suria semi-detached houses in
Shah Alam 2.
22 W O R L D B U S I N E S S
BlackBerry, Samsung
deny talks about deal
One question is whether the Canadian govt would approve sale to foreigners
BY GERRI T D E VYNCK
& JU NGA H L EE
TORONTO: BlackBerry Ltd and
Samsung Electronics Co denied
reports that they are in talks about
Samsung potentially acquiring the
Canadian smartphone maker.
Reuters, citing an unnamed person and documents, reported that
Samsung had recently approached
BlackBerry with an initial offer price
of US$13.35 (RM47.53) to US$15.49
a share, valuing the company at as
much as US$7.5 billion. Reuters
also said executives from the two
companies met last week to discuss
a transaction.
The report is “groundless,” Samsung said in an email.
BlackBerry said it’s “aware of
certain press reports published
today (yesterday) with respect to a
possible offer by Samsung to purchase BlackBerry,” according to a
statement. “BlackBerry has not engaged in discussions with Samsung
with respect to any possible offer
to purchase BlackBerry.”
BlackBerry gets offers all the
India makes
surprise interest
rate cut to 7.75%
MUMBAI: India’s central bank
cut interest rates by 25 basis
points yesterday, the first time
in almost two years, in a surprise announcement to boost
the flagging economy after inflation eased.
The Reserve Bank of India
(RBI) reduced the benchmark
repo rate — the level at which it
lends to commercial banks —
to 7.75% ahead of next month’s
policy meeting.
RBI governor Raghuram Rajan said the bank was confident
of cutting rates because local
food and global oil prices have
brought stubborn inflation under control in recent months.
“These developments have
provided headroom for a shift
in the monetary policy stance,”
Rajan said in a statement.
The RBI has been under
pressure from government and
business leaders to reduce rates
to increase lending and help
kick-start the economy, which
has been struggling through
the worst slowdown since the
1980s.
Prime Minister Narendra
Modi promised to reform and
revive Asia’s third-largest economy by attracting more foreign
investors and bolstering manufacturing. — AFP
Filepic of BlackBerry chief
executive John Chen at the launch
of the new Blackberry Classic
smartphone in New York. Reuters
reported that Samsung had
recently approached BlackBerry
with an initial offer price of
US$13.35 to US$15.49 a share.
Photo by Reuters
time, according to a person close
to the company, who asked not to
be identified. Investors would want
a much higher takeover price than
what Reuters reported, the person
said. The reported purchase price
would be at least a 37% premium
to BlackBerry’s closing price on
Tuesday.
One question is whether the
Canadian government would approve the sale of BlackBerry to a
foreign company. Canada reviews
foreign takeovers valued at more
than C$354 million (RM1.05 billion)
to determine if the deal represents
a “net benefit” to the country. The
government can also review deals
based on national security considerations. — Bloomberg
SINGAPORE: Gold demand will rebound in 2015 as bullion consumption in Asia increases and investors
return to exchange-traded products
backed by the metal, according to
HSBC Securities (USA) Inc.
Global demand may rise 15% to
4,127 tonnes this year, analysts James
Steel and Howard Wen wrote in a
report on Wednesday. Consumption reached a record 4,582.3 tonnes
in 2011, when prices climbed to a
peak of US$1,921.17 (RM6,839.36)
an ounce, according to data from
the World Gold Council.
Gold last year posted the first
back-to-back annual drop since
2000 as assets in bullion-backed
exchange traded products (ETP)
contracted, the dollar advanced and
US equities surged. An economic
slowdown in China and import
restrictions in India also hurt gold
purchases by the world’s largest
consumers in 2014. Rising Asian
demand for gold may help bullion
prices to recover after testing new
lows this year, Barclays plc said in
a report this week.
Assets in gold-backed ETPs
will probably expand 50 tonnes
this year, according to HSBC. The
holdings contracted 164.4 tonnes
last year after plummeting 869.1
tonnes in 2013 as prices retreated,
data compiled by Bloomberg show.
— Bloomberg
Shire gambles AbbVie break fee on risky US$5b deal
BY NEIL UNM AC K
LONDON: Shire is gambling its
AbbVie break fee on a risky merger
and acquisition. The Dublin-based
pharma group has agreed to buy US
peer NPS to expand in lucrative rare
drugs. The 51% premium is covered
almost entirely by compensation
from the collapse of Shire’s sale to
larger American rival AbbVie last
year. That doesn’t much mitigate
the risk of doing a deal ahead of a
key regulatory ruling.
It’s no surprise to see Shire chief
executive Flemming Ornskov back on
the acquisition trail. NPS had been
tipped as a target back before AbbVie
launched a successful bid for Shire itself, only to be wrong-footed by a US
clampdown on tax-driven mergers.
Uniqlo pledges to improve
work conditions after
mistreatment claims
TOKYO: Japanese clothing giant
Uniqlo yesterday pledged to improve working conditions at its
Chinese suppliers and beef up
monitoring, following claims
that the companies were putting
employees at risk. The chain’s
parent company Fast Retailing
said it was ushering in changes
after the Hong Kong-based Students and Scholars Against Corporate Misbehaviour (Sacom)
published a study this week that
said factory conditions were unsafe and workers were mistreated. “Respecting human rights
and ensuring appropriate working conditions for the workers
of our production partners are
top priorities and in this we are
completely aligned with Sacom,”
said the firm. — AFP
More executive units
launched compared with
private condos
Gold demand seen expanding 15%
BY GLENYS S I M
IN BRIEF
The strategic logic of buying NPS is
hard to fault. The deal cements Shire’s
position as a specialist in rare-disease
drugs, which target illnesses affecting less than 200,000 patients and so
benefit from generous patents or tax
incentives. Shire gets access to Gattex, for short-bowel syndrome, and
Natpara, for hypothyroidism.
The financial wisdom isn’t so clear.
Given the niche focus, cost synergies
are scant. Shire says it could cut 25% to
35% of 2017 costs, or US$100 million
(RM356 million) based on Deutsche
Bank estimates. Taxed and capitalised, those would cover only half the
premium. There are possible revenue
synergies too if Shire can crank up
sales of Gattex and develop Natpara.
The snag is Shire is playing its chips
just days before the US Food and Drug
Administration decides whether to
approve Natpara. An advisory panel
last year voted eight to five to recommend the drug, but worried about its
side effects. The risk is that Natpara
isn’t approved after all, or safety concerns could limit its potential.
Moving today may have helped
Shire avoid a bidding war, or paying
even more when uncertainty eases.
And by reinforcing its position in the
highly valued rare-disease sector,
Shire may defend its premium rating,
currently 18 times next year’s forecast
earnings. Yet with US healthcare providers increasingly focused on costs,
and some rare-disease treatments
costing over US$400,000 per year, the
bet assumes that this area of medicine
will escape the broader trends in the
pharmaceutical industry. — Reuters
SINGAPORE: Developers
launched more executive condominiums (EC) than private
apartments in December amid
the traditional lull in buying
during the holiday season, The
Straits Times reported. They
put up 747 EC units for sale, far
higher than the 53 private condo
units launched, data from the
Urban Redevelopment Authority showed yesterday. But that
did not stir up enough interest
as buyers were still more active
in the private market, taking up
230 apartments compared with
176 EC units. December’s EC
scorecard also paled considerably in comparison with November, when 1,758 units were
launched and 855 sold.
Billionaire Carlos Slim
doubles holdings in
New York Times
NEW YORK: Billionaire Carlos
Slim became the largest investor
in the New York Times Co after
exercising options to acquire
15.9 million shares in the newspaper company. Slim bought
the shares for almost US$6.36
(RM22.70) each, about half of
Times Co’s US$12.28 closing
price, Times Co said yesterday
in a statement. That boosted his
stake to 16.8% of the company’s
Class A shares. The world’s second-richest person gained the
options after he lent the paper
US$250 million in January 2009
to help it get through the financial crisis. — Bloomberg
Best practices on having
more women, diverse
boards introduced
SINGAPORE: Companies hoping to put together more diverse
boards, particularly with more
women directors, can look to a
newly issued set of best practices for advice, The Straits Times
reported. The Diversity Action
Committee, which was formed
last year to boost female representation on company boards,
teamed up with five executive
search firms to come up with
the suggested road map, which
was unveiled yesterday.
24 W O R L D B U S I N E S S
Further slide on glut fears
Increased US output bolsters concerns that global oil oversupply will persist
BY B EN SHA RPL E S
MELBOURNE: Oil resumed its decline after the biggest gain since
June 2012 as US crude production
increased, bolstering speculation a
global supply glut that spurred last
year’s price collapse may persist.
Futures dropped as much as 1.8%
in New York. US output surged to
9.19 million barrels a day last week,
the fastest pace in weekly records
dating back to January 1983, the
Energy Information Administration (EIA) reported on Wednesday.
Crude may fall below a six-month
forecast of US$39 (RM138.84) a barrel and rallies could be thwarted by
the speed at which lost shale production can recover, according to
Goldman Sachs Group Inc.
Oil slumped almost 50% last year,
the most since the 2008 financial
crisis, as the Organization of the
Petroleum Exporting Countries re-
China bank
lending up
in 2014
SHANGHAI: China’s bank lending
rose to US$1.6 trillion (RM5.7 trillion)
in 2014, the central bank said yesterday, as the government sought to loosen credit to spur faltering growth in
the world’s second-largest economy.
Domestic banks made new loans
of 9.78 trillion yuan (RM5.64 trillion)
last year, the People’s Bank of China
(PBoC) said in a statement.
The figure represented year-onyear growth of 10% from 8.89 trillion
yuan in 2013, data showed, but fell
short of a reported 10 trillion yuan
annual target.
Chinese authorities encouraged
banks to lend more in the last two
months of 2014 in an attempt to
reach the mark, media reports said,
and in November the government
also cut interest rates for the first
time in over two years.
But banks only extended 697.3
billion yuan in new loans for December, the PBoC said, down from
852.7 billion yuan in November.
“The slowdown of the new loan
extension in December suggests
that China’s commercial banks are
still concerned about the credit
risks,” ANZ banking group said in
a research report.
Total social financing, a broader
measure of credit in the economy,
was 16.46 trillion yuan for all of last
year, down by 859.80 billion yuan
from 2013, in a reflection of concerns about credit risk and tighter control over informal “shadow
banking” activities, analysts said.
ANZ expects more monetary
easing this year, including cuts in
banks’ reserve requirements, to
combat slowing growth. Reserve
requirements are funds that banks
must put aside, as required by the
central bank. — AFP
sisted cutting output even amid
the US shale boom, exacerbating a
surplus estimated by Kuwait at 1.8
million barrels a day. Prices rose on
Wednesday as a relative strength index rebounded after more than two
weeks below 30, a level that typically
signals the market is oversold.
“You tend to arrive at points every
now and then in major trends like
this where you just see a little bit of
short covering and profit taking,” Ric
Spooner, a chief strategist at CMC
Markets in Sydney, said by phone
yesterday. “Supply is still the general theme.”
Oil is leading this week’s slide in
commodities after a decade-long
bull market led companies to boost
production and a stronger dollar diminished their allure to investors.
The Bloomberg Commodity Index
of 22 energy, agriculture and metal
products decreased to the lowest
level since November 2002 on Tues-
day, extending a 17% loss last year.
West Texas Intermediate (WTI)
for February delivery declined as
much as 88 cents to US$47.60 a
barrel in electronic trading on the
New York Mercantile Exchange and
was at US$47.64 at 3.34pm Singapore time yesterday. The contract
advanced US$2.59, or 5.6%, to
US$48.48 on Wednesday. The volume of all futures traded was about
10 times the 100-day average.
Brent for February settlement,
which expires yesterday, dropped
as much as US$1.14, or 2.3%, to
US$47.55 a barrel on the London-based ICE Futures Europe exchange. The more-active March future was US$1.05 lower at US$48.81.
Brent traded below WTI earlier
this week for the first time since July
2013, indicating that Saudi Arabia’s
strategy of curbing American shale
output growth is working, according
to Societe Generale SA. The Euro-
pean benchmark crude was at a
discount of eight cents yesterday.
US crude production accelerated
by 60,000 barrels a day in the week
ended last Friday, the EIA reported
on Wednesday. Stockpiles expanded by 5.39 million barrels to 387.8
million, more than 9% above the
five-year average for this time of
year, according to the Energy Department’s statistical arm. Inventories at Cushing, Oklahoma, the
delivery point for New York-traded
futures, climbed for a sixth week.
WTI will fall to US$40 a barrel by the end of the first quarter
while Brent may decrease to US$42
amid the “war” for market share,
according to Australia & New Zealand Banking Group. For the year,
futures are projected at US$48 and
US$50, respectively, analysts including Mark Pervan in Melbourne
said in an emailed report yesterday.
— Bloomberg
Price floor may be long way down
BY EDWAR D HADAS
LONDON: The oil market these days
offers producers lessons in three basic ideas of market economics. They
are all painful.
The first is about the nature of oligopoly. When producers limit their
combined supply, they can set the
price at almost any level. But the
higher the price, the more fragile
the cartel tends to be. Three years of
oil at around US$110 (RM391.60) a
barrel were enough to create a rift.
The main reason was that the government of Saudi Arabia, a low-cost
supplier, resented cutting back output while more expensive producers
went full out. Last June, the Saudis
stopped trying to support the price.
Without a cartel, the fall has been
rapid, from US$115 to US$46 for a
barrel of Brent crude.
A post-cartel market will find a
balance of supply and demand at
some price. This is where the second
idea, the difference between full and
marginal cost, comes in. Little production will become uneconomical
until the price drops, and stays below,
US$30 a barrel.
However much it costs to drill a
well, its owner will keep producing
until it costs less to shut it down than
to run it. For oil, most of the expense
is upfront, in exploring, drilling and
building pipelines. The operating
break-even price is typically very
low and frantic cost cuts will reduce
it further.
What about demand? Prices
might stabilise at a higher level if
lower prices encouraged more consumption. But the third economic
idea, price inelasticity, suggests this
won’t happen. The price at the well
head has little effect on how much
oil is used, even if governments do
not raise taxes on cheaper oil, as the
Chinese just did.
The Saudis probably do not want
to see how low oil can go. Rather,
they presumably want to reestablish
a cartel on more favourable terms
for themselves. If that were to happen, the price of crude could quickly
double from whatever level it has
plumbed. But if agreement cannot
be reached, the wait for prices to rebound could be very long. — Reuters
Xiaomi challenges Apple with flagship Mi Note
BY PAUL CARS TE N
BEIJING: China’s Xiaomi Inc staked
its claim to Apple Inc’s crown yesterday as the world’s third-biggest
smartphone maker and most valuable tech start-up unveiled the
flagship Mi Note, its challenger to
Apple’s iPhone 6 Plus.
Chief executive Lei Jun introduced the Mi Note in Beijing with
a breakdown of the large-screen
phone’s technical features, with
multiple comparisons to Apple’s
equivalent. At 2,299 yuan (RM1,325)
for a model with 16 gigabytes of
memory, the Mi Note will retail
for almost two-thirds less than the
iPhone 6 Plus.
Just three years after Xiaomi sold
its first smartphone, a US$1.1 billion
(RM3.92 billon) round of fundraising announced in December valued the firm at US$45 billion. The
IN BRIEF
Mexico invites new bids
for bullet train
MEXICO CITY: Mexico’s government reopened the bidding
process for a bullet train project
on Wednesday, two months after
a Chinese-led consortium’s winning tender was controversially
cancelled. The transport ministry published the preliminary
terms to enter the contest to build
Mexico’s first high-speed railway,
linking Mexico City to the central
manufacturing hub of Queretaro.
China Railway Construction Corporation and Mexican partners
had been awarded the US$3.75
billion (RM13.35 billion) contract
in November, but President Enrique Pena Nieto abruptly cancelled the deal three days later,
citing concerns over transparency in the process. — AFP
Japan’s Skymark hit by
collapsed deal report
TOKYO: Shares in Japanese
budget airline Skymark plunged
yesterday after a report said talks
about a capital injection deal
with bigger rival All Nippon Airways (ANA) had collapsed. The
company’s Tokyo-listed shares
dropped as much as 15.38% in
early trading before recovering
some losses to close 6.92% lower
at ¥363 (RM11). Investors were
spooked by a report in the Asahi
newspaper that said a possible
agreement over ANA investing
in Skymark had fallen apart, and
that the money-losing carrier
would try to climb out of the
red on its own. Skymark, which
flies domestic routes in Japan,
rejected the report. — AFP
Alibaba falls below US$100
in post-holiday slump
NEW YORK: Alibaba Group
Holding Ltd, China’s biggest
e-commerce company, fell for
a fourth day in New York, extending a retreat from its November high as the peak shopping season ended and investors
await quarterly results expected
next month. The shares slid 1.2%
to US$99.58 (RM354.50), falling below US$100 for the first
time since October. JD.com Inc,
China’s second-largest online
shopping platform, and E-Commerce China Dangdang Inc also
posted four-day declines. Online sports-lottery operator 500.
com Ltd retreated after surging
27% in the previous two days.
— Bloomberg
S Korea slashes 2015
economic growth forecast
Lei showing Mi Notes at the launch in front of an audience of thousands in Beijing
yesterday. Photo by Reuters
privately held company has risen
to become the world’s No 3 smartphone maker and is challenging
Apple and Samsung Electronics Co
Ltd as well as domestic rivals such
as Huawei Technologies Co Ltd.
“The Mi Note is shorter, thinner
and lighter than the iPhone,” Lei
told his audience of thousands.
Xiaomi weathered a decline in
overall smartphone sales in China last year to see revenue more
than double to 74.3 billion yuan
from 2013. The company sold more
than 61 million handsets in 2014.
— Reuters
SEOUL: South Korea’s central
bank yesterday slashed its 2015
economic growth forecast and
kept its benchmark interest rate
unchanged at a record low amid
growing concerns of deflation.
Bank of Korea governor Lee
Ju-yeol put the new estimate for
Asia’s fourth-largest economy at
3.4% growth this year, compared
to an earlier forecast of 3.9%. The
bank decision to leave its key rate
unchanged at 2% was widely expected, although some analysts
had predicted a cut of 25 basis
points to boost tepid domestic
consumption and ease deflation
concerns. — AFP
26 WORLD
IS-inspired US man arrested
over plot to attack Capitol
Washington Post says he does not appear to have formal backing from overseas
WASHINGTON: A US man was arrested on Wednesday for allegedly
plotting an attack on Congress inspired by Islamic State (IS) jihadists,
according to the Justice Department
and the Federal Bureau of Investigations (FBI).
Christopher Cornell, 20, was
taken into custody after he purchased two semi-automatic weapons and 600 rounds of ammunition in the US state of Ohio,
‘Reborn’ Charlie
Hebdo buries
its best-known
cartoonists
BY RI C H A RD CARTER
PARIS: Two of Charlie Hebdo’s best-known cartoonists
were buried yesterday, as
the “reborn” satirical magazine flew off the shelves but
sparked fury in some parts of
the Muslim world for depicting the prophet Mohammed.
Georges Wolinski, 80, and
Bernard “Tignous” Verlhac,
57, were laid to rest in private family funerals after they
were gunned down by two Islamist brothers in last week’s
attack claimed by al-Qaeda.
After the shooting at the
magazine, which killed 12
people, the French battled to
get their hands on the “survivors’ issue” which sold out
on Wednesday before more
copies of an eventual print
run of five million hit newsstands.
Debate was
mounting in France
over where freedom
of expression
begins and ends.
“Charlie Hebdo is alive and
will live on,” Hollande said on
Wednesday. “You can murder men and women, but you
can never kill their ideas,” he
said, declaring the previously
struggling weekly “reborn”.
The Charlie Hebdo assault
was followed by an attack on
a kosher supermarket in Paris
by a gunman claiming to have
coordinated his actions with
the Islamist brothers, Said
and Cherif Kouachi.
Meanwhile, debate was
mounting in France over
where freedom of expression begins and ends. — AFP
according to a criminal complaint.
The Justice Department said he
was charged “with attempting to
kill officers and employees of the
United States” and possession of
a firearm to carry out violent acts.
According to the complaint,
Cornell had opened a Twitter account under the pseudonym Raheel
Mahrus Ubaydah, where he posted
messages supporting IS militants.
The Washington Post said he
does not appear to have any formal backing from overseas.
Rather, according to an affidavit in support of the criminal
complaint, he indicated that by
conducting an attack he would be
“fulfilling the directives” of violent
jihadists.
He is accused of sending messages to an informant from the FBI
outlining his plans.
“I believe that we should just
wage jihad under our own orders
and plan attacks and everything,”
he told the informant, according
to the complaint.
He also said he planned to
launch several attacks and wanted
to target US officials in Washington.
“He considered the members
of Congress as enemies and that
he intended to conduct on attack
on the US Capitol,” the complaint
said. — AFP
PM: Turkey will not allow Prophet
Mohammed to be insulted
ANKARA: Turkey will not allow
Prophet Mohammed to be insulted, Prime Minister Ahmet Davutoglu said yesterday, describing
the publication of cartoons of the
prophet as an open provocation.
“Freedom of the press does not
mean freedom to insult,” Davutoglu
told reporters in Ankara a day after
leading Turkish daily Cumhuriyet
and Turkish Internet sites published
cartoons featuring the prophet from
the special Charlie Hebdo issue.
The newspaper produced a
special four-page pull-out of cartoons and articles drawn from
the French satirical magazine on
Wednesday in solidarity with the
12 people gunned down in an attack on its offices in Paris.
“We do not allow any insult
to the prophet in this country,”
Davutoglu said. “As the government, we cannot put side by side
the freedom of press and the lowness to insult.”
Davutoglu said people were sensitive about their religion in the predominantly Muslim Turkey and could
not be expected to show patience towards insults to the Muslim prophet.
BEIJING: A year ago, China’s thirst
for milk was the great white hope for
dairy companies. Now the froth has
started to subside. A profit warning
from Hong Kong-listed infant formula maker Yashili shows the dangers
of investing based on broad consumer trends.
At first glance, the halving of Yashili’s shares in just over a year doesn’t
square with the consumer reality.
Food scares and an expanding middle class have driven China’s consumers to prefer foreign powdered
milk. The overall market is set to double in the four years to 2017, accord-
Murdoch stirs tweetstorm
with Muslim comments
WASHINGTON: Media tycoon Rupert Murdoch sought
to backtrack Wednesday from
a Twitter storm stemming from
comments about Muslims following the Paris attacks. “Certainly did not mean all Muslims
responsible for Paris attack.
But Muslim community must
debate and confront extremism,” Murdoch said in a tweet
that followed a barrage of criticisms of a comment made last
week. The 83-year-old media
baron’s comments about the
bloody assault on French magazine Charlie Hebdo stirred up
taunts and angry replies, many
using the hashtag #RupertsFault.
The Australia-born head of News
Corp drew fire for his Jan 9 tweet
which said, “Maybe most Muslims peaceful, but until they recognise and destroy their growing
jihadist cancer they must be held
responsible.” — AFP
Pollution soars in Chinese
capital amid winter smog
BEIJING: Pollution levels
soared in Beijing on Thursday
to readings more than 20 times
WHO recommended limits, as
an annual bout of intense smog
returned to haunt the Chinese
capital despite government
vows to address the plague.
Levels of PM2.5 particulates
— the smallest and most dangerous, with a diameter small
enough to deeply penetrate
the lungs — were recorded at
568 micrograms per cubic metre by the US embassy during
the afternoon. An even worse
reading of 631 was recorded at
a municipal monitoring station
in the east of the city. — AFP
Boko Haram ‘killed
woman in labour’ in attack
Riot police officers guarding outside the offices of daily newspaper Cumhuriyet in
Ankara on Wednesday after it published a four-page spread of Charlie Hebdo cartoons.
Photo by Reuters
“If some print cartoons that insult the prophet — and this is the
situation and there is a sensitivity in
Turkey — it is a provocation ... it is an
open provocation,” said Davutoglu.
“We are determined to protect
the honour of the prophet the
same way as we are determined
in our stance against terrorism in
Paris,” he said. — AFP
Milk slump sends warning on China consumer froth
BY JOHN FO LE Y
IN BRIEF
ing to Euromonitor. Yashili’s appeal,
and one reason French dairy group
Danone has bought a 25% stake in
the company, was that it sources
its raw material overseas, so it can
charge a premium. State pledges to
consolidate the milk market should if
anything help support Yashili’s value.
The trouble is that markets and
suppliers got ahead of themselves.
Imports of whole powdered milk in
China are likely to fall 12% in 2015,
according to the US Department of
Agriculture. The price of the stuff has
sunk by over 50% over the past year.
Customers are as thirsty as ever, but
suppliers now need to work through
their inventories, and worry about
increasing domestic production.
Yashili’s profits are set to fall 40%
this year. Babies still need milk, but
producers forgot that what’s rational for one company is the opposite
when all join in.
Too-great expectations have set in
elsewhere too. Li Ning, a sportswear
brand, is still reeling from stuffing retailers with stock they now can’t sell.
It also warned on profits last week.
Auto manufacturers are having to
compensate car dealers who filled
showrooms in the expectation that
auto sales would keep climbing rapidly. For them, estimated 7% demand
growth in 2015 is a disappointment,
and a financial headache. — Reuters
LAGOS (Nigeria): Boko Haram
fighters killed a woman as she
was in labour during what is
feared to be the deadliest attack in the militants’ six-year
insurgency, Amnesty International claimed yesterday. The
human rights group said one
witness to the assault on Baga,
on the shores of Lake Chad in
northeast Nigeria, told them
the woman was shot by indiscriminate fire that also cut down
small children. “Half of the baby
boy (was) out and she died like
this,” the unnamed witness was
quoted as saying. — AFP
China approves new
polio vaccine
SHANGHAI: China has approved a new polio vaccine,
the first of its kind to be produced in the country, a month
after local authorities gave the
green light for a home-grown
Ebola vaccine amid Beijing’s
push to become a world leader
in producing innovative drugs.
The development drew praise
from the World Health Organization yesterday who said the
vaccine, which will be given to
Chinese children as part of routine disease prevention, would
help the global fight against the
polio virus. — Reuters
W O R L D 27
China enlists citizens to
patrol border with N Korea
In the wake of two reported killings of Chinese citizens — state media
BY SU I - L EE WEE
& MEGHA RA JAGOPALAN
BEIJING: China is sending civilian
militias to help secure the border it
shares with North Korea, state media
said, in the wake of two reported killings of Chinese citizens by North Koreans that could strain ties between
Pyongyang and its sole major ally.
The China Defence News said
on Wednesday the government
had established a civilian-military
defence system in the Yanbian prefecture of Jilin province. Yanbian
shares a border of about 500km
with North Korea.
“China and North Korea are both
keeping guard on the border...,” the
newspaper said. “The situation is
more complicated and relying on
just one party would make it difficult to achieve effective control.”
The government has also “guided the establishment of militia
patrols” to guard border villages.
Every 10 neighbouring households
would have their own border security group and there would be
24-hour video surveillance, the
newspaper said.
Last week, China said it had
lodged a protest with North Korea
after media reported that a North
Korean army deserter had killed
four people during a robbery in
the Chinese border city of Helong
late last month.
State media has raised questions
about the China and North Korea
relationship, saying that the Chinese government “should not be
too accommodating”.
The issue of border security has
become “very serious”, said Zhang
Liangui, a North Korea expert at
China’s Central Party School. “The
fact that North Koreans are running
over the border to China shows
that North Korea’s regulation of the
border is seriously problematic,”
he said. “They have neglected it.”
While it is too early to determine
if there will be a long-term impact on
diplomatic ties, the situation raised
tension near the border, he said.
“For those Chinese citizens living near the border, there is widespread anxiety right now, the impact
of the situation is very serious,” he
said. “To say that this will have no
impact on relations with North Korea just doesn’t match with reality.”
— Reuters
S Korea orders lockdown to fight disease
SEOUL: South Korea yesterday
announced a 36-hour lockdown
over the weekend on poultry and
livestock farms across the country
to curb the spread of two highly
contagious animal diseases — footand-mouth and bird flu.
The agriculture ministry said
the movement of animals, people
US cabbie gets
US$1,000 tip
for two-minute
drive
NEW YORK: A quick chat and
a two-minute drive is all it took
for an American cab driver to
be tipped nearly US$1,000
(RM3,560).
Oumar Maiga, a night-shift
driver from Philadelphia, was
so stunned he waited a month
for the credit card transaction
to clear, convinced the mystery benefactor might claim
a mix-up.
His boss, Freedom Taxi owner Everett Abitbol, said it was
the largest tip he had ever seen
for such a small fare: US$4.31
for a brief, late-night pick-up in
downtown Philadelphia.
Maiga picked up the anonymous passenger and the two
struck up a conversation.The
two exchanged pleasantries
about the driver’s busy schedule in the run-up to Christmas
and the customer said he knew
being a cabbie was a tough job,
Abitbol told AFP.
“He said, ‘Hey, I’m going
to take care of you’ and when
our driver looked down he said
‘Sir, I think you made a mistake’ but he said ‘that’s what I
want to give you, I know what
I did’.”— AFP
and vehicles at thousands of farms
would be banned from 6am (2100
GMT) tomorrow for disinfection.
A series of outbreaks of footand-mouth in recent months have
resulted in the slaughter of around
25,000 pigs, and concern has grown
as cases have spread to farms close
to the capital Seoul.
The first cases were detected in
July, only two months after South
Korea was declared free of the disease at a meeting of the World Organisation for Animal Health in
Paris, France.
Last week, the agriculture ministry confirmed a case of foot-andmouth in a cow, the first involving
cattle in nearly four years.
In 2011 a devastating foot-andmouth outbreak hit the entire Korean
peninsula and resulted in the culling
of nearly 3.5 million cattle, pigs, and
other animals in South Korea alone.
The Seoul government estimated the
cost of that outbreak at US$2.6 billion
(RM9.27 billion). — AFP
Want more holidays? Move country
SINGAPORE: In the pursuit of a
more successful life and work balance (and more time to travel),
Wego, the leading travel search site
in the Asia-Pacific and Middle East,
reveals which countries around the
world have the most public holidays.
“There’s no better remedy for
the post-holiday blues and start of
a new year than to look ahead and
plan your next holiday,” said Joachim
Holte, Wego chief marketing officer.
“Depending on where you live however, some of us have a lot more days
off to play with than others!”
“India has the most number of
public holidays at around 21 days
each year, even more depending on
which state you live in,” he observed.
“In the Asia/Pacific region, the Philippines follows with 18, 17 for China
and Hong Kong, Thailand receives
16, 15 in Malaysia and Vietnam,
14 for Indonesia, 13 in Taiwan and
South Korea, 11 in Singapore, and
10 in Australia and New Zealand.”
“China is not only one of the
fastest growing travel segments in
the world, their government makes
it easy for workers to take longer
breaks. Should the year’s public holidays fall on a weekend the government swaps the official dates with
weekdays, maximising time off,” said
Holte. “So this year, the total of 17
public holidays equates to 28 days
off. Similarly the Taiwanese total of
13 public holidays results in 29 days
IN BRIEF
Turkish PM compares
Netanyahu with ‘Paris
terrorists’
ANKARA: Turkish Prime Minister Ahmet Davutoglu yesterday said Israeli Prime Minister
Benjamin Netanyahu had committed crimes against humanity
comparable to those behind the
Paris attacks that left 17 dead.
“Netanyahu has committed
crimes against humanity the
same like those terrorists who
carried out the Paris massacre,”
he told reporters in televised
comments. His comments risk
ratcheting up a new row in the
increasingly tense relationship
between the two countries after
Turkish President Recep Tayyip
Erdogan blasted Netanyahu for
“daring” to attend the weekend’s
anti-terror solidarity march in
Paris after the attacks.Netanyahu spat back on Wednesday that
Erdogan’s “shameful remarks
must be repudiated by the international community.” — AFP
Police: Two suspected
rebels killed in Indian
Kashmir gun battle
SRINAGAR (India): Two suspected rebels were killed yesterday in a fierce gun fight with
government troops in a forested area of the disputed Indian
Kashmir region, police said.
Clashes erupted when police
and army officers launched a
hunt for the militants after receiving “specific information”
they were in the Gadar forest
near the main city of Srinagar.
“They came under fire triggering a gun fight. Two militants
have been killed so far,” a top
police officer told AFP on condition of anonymity as he was
not authorised to speak to media. He said two or three more
militants were still fighting the
government forces. — AFP
US sends five
Guantanamo prisoners
to Oman, Estonia
off inclusive of weekends.”
Europeans don’t fare too badly
with Sweden and Lithuania offering the most at 15 (the latter with
an additional 28 days of paid leave),
followed by 14 in Slovakia, 13 in Austria, Belgium and Norway, and 12 in
Finland and Russia. Spain and the
United Kingdom are not so holiday
minded, with only eight. In the United Arab Emirates (UAE), another fast
developing travel market, you can
expect 11 public holidays in 2015.
“Mexico has the lowest in the
world with only seven public holidays each year although the government permits a few more ‘optional’
public holidays, at the employer’s
discretion.”
“Some countries however provide
a little more in the way of statutory
holiday leave which can top up public holidays nicely,” Holte continued.
“The Philippine public holiday count
of 18 is increased with an additional
five days mandatory holiday leave,
and while Australian workers receive
around 10 public holidays depending on which state you live in, annual
holiday leave entitlement totals an
additional 20 working days.”
“Travel is like a reward for all those
hard working days we spend at the
office but the amount of paid leave
is what restricts us from making the
most of those opportunities,” added
Holte. “Combining public holidays
with your annual leave is the best way
to maximise time off, take trips and
preserve a healthy life/work balance.”
WASHINGTON: The United
States has transferred five men
from its Guantanamo Bay prison,
the Pentagon said on Wednesday, in a renewed push by President Barack Obama toward closing the controversial jail. Four of
the inmates were sent to Oman,
while one was sent to Estonia, according to Pentagon statements.
Officials said “a comprehensive
review” of the cases was conducted by several US agencies
before the men were moved and
that all were “unanimously approved for transfer”. The transfer
leaves 122 inmates at the remote
prison, which is located at a US
naval base in southeastern Cuba.
— AFP
Pope Francis arrives
in the Philippines
MANILA: Pope Francis arrived
in the Philippines yesterday for
the second leg of an Asian tour
that organisers believe could see
a world-record crowd turn out
for a papal mass. Francis landed
at Manila’s international airport
from Sri Lanka, and was due to
be greeted by Philippine President Benigno Aquino. — AFP
28
live it!
FR I
WELLBEING . THE ARTS . WINE+DINE . STYLE+DESIGN . LEISURE
Personal
ASSISTANT
COMPI L ED BY MAE CHAN
WORK. LIFE. BALANCE
MAKE a sweet visit back to the 1970s
and early 1980s with a musical tribute to
The Carpenters at the Theatre Lounge
Café, Plaza Damas 3, Kuala Lumpur,
this weekend. While enjoying a drink or
two, take a trip down memory lane with
evergreen hits such as Rainy Days and
Mondays, Solitaire, Top of the World and
Sing. Sung by vocalist Samantha de Lune,
who, though young in age, has been making
the rounds on the live gig scene. She will
be accompanied by musical director Nish
Tham, with guest appearances by veterans
Ida Mariana and Nell Ng. Yesterday Once
More will start tonight at 9pm, playing
three shows till Sunday. There will be a
RM65 cover charge. For reservations and
enquiries, call (03) 6730 7982.
IT’S set to be an
all-star evening
at Zouk, Kuala
Lumpur, tomorrow
night where Chris
Blackhall, one of the
top-ranked DJs by
the world’s leading
dance publication, DJmag, will be spinning
at Loud. A benchmark for industry standard
in measuring the popularity of the biggest
names on the international scene, DJmag is
much more than just a publication, having
presented recent Allstars gigs in Ibiza, Brazil,
and the United States featuring names like
Calvin Harris, Afrojack, Derrick Carter and
Metro Area. Ticket entry is RM25 before
11pm, which includes one drink, going up to
RM35 after 11pm. A bottle purchase entry
costs RM351 for five pax for the whole night.
For reservations, call (03) 2171 1997 (noon6pm) or (016) 3323 191 (after 6pm). Entrants
must be 21 years old and above.
WHY not
celebrate the
start of 2015
all the way till
Jan 31 with
some delicious
bubbly? Prego
at The Westin
Kuala Lumpur is
offering a Moët
So Bubbly lunch
menu, with a choice of two- or three-course
set lunch that comes with a glass of Moet
NV champagne. Enjoy a menu that ranges
from seared sea scallop salad and goose
liver with jam on brioche bread to saffron
risotto with prawn and sea bass with main
lobster sauce asparagus — just to name
a few — and wash it all down with that
glass of crisp bubbly. The two-course
lunch is priced at RM110++ and the threecourse at RM130++. The special menu is
only available until the end of this month
between noon and 2.30pm. For reservations
and enquiries, call (03) 2773 8338.
On to the
OSCARS
Hollywood set for Academy Award nominations
H
ollywood was counting
down the hours before
the unveiling early yesterday of nominees for
this year’s Oscars, the
climax of Tinseltown’s
awards season.
Coming-of-age drama Boyhood and
dark comedy Birdman were expected
to be among the front runners for coveted Best Picture honours.
The Imitation Game, Selma, The
Theory of Everything and The Grand
Budapest Hotel should also be in the
hunt for Oscars gold.
The nominated films, actors and
filmmakers was to be revealed at a predawn ceremony in Beverly Hills, firing
the starting gun on the home stretch of
the annual awards race.
On the Best Actor front, likely nominees included Michael Keaton (Birdman) and two British hopefuls — Benedict Cumberbatch (The Imitation Game)
and Golden Globe winner Eddie Redmayne (The Theory of Everything).
For Best Actress, Globe winner Julianne Moore (Still Alice), Reese Witherspoon (Wild) and Britain’s Rosamund
Pike (Gone Girl) were among expected
contenders, according to awards website Gold Derby.
The Oscar nominees — chosen by
the 6,000-plus members of the Academy of Motion Picture Arts and Sciences — were to be revealed shortly after
01 5.30am (1330 GMT) yesterday.
The 87th Oscars will be held on Feb
22 at the Dolby Theatre in downtown
Hollywood. Voting starts on Feb 6 and
closes on Feb 17.
This year’s crop of hotly-tipped movies is heavy on true stories: four of the
five films nominated for the best drama
award at last weekend’s Golden Globes
— many of which could figure on the
Oscars Best Picture shortlist — were
based on real-life events.
Among the historical figures given
big-screen treatment are astrophysicist Stephen Hawking (The Theory of
Everything), British mathematician
Alan Turing (The Imitation Game) and
Martin Luther King Jr (Selma).
For Best Director, Richard Linklater
— who made Boyhood with the same set
of actors over 12 years — is a clear front
runner along with Alejandro Gonzalez
Inarritu (Birdman) and Wes Anderson
(The Grand Budapest Hotel).
Best Supporting Actor tips include
Globes winner JK Simmons for jazz
drumming pic Whiplash, Ethan Hawke
for Boyhood and Edward Norton for
Birdman, while among Best Supporting Actress likely nominees are Patricia
Arquette (Boyhood) and Emma Stone
(Birdman).
Meryl Streep, who has won three
Oscars and received a record 18 nominations, could also extend that lead
with a nod for her turn as the witch in
the fairytale musical Into the Woods.
The eagerly-awaited Academy
Aw
an
Bo
Go
be
for
act
on
ab
eac
led
du
live it! 29
02
Awards — also known as the Oscars —
announcement came just four days after
Boyhood emerged triumphant from the
Golden Globes, winning best film and
best director honours, along with a prize
for Arquette.
Birdman — about a washed-up film
actor (Keaton) trying to revive his career
on stage — and The Theory of Everything,
about Hawking’s descent into disability,
each took home two awards.
The Globes — for which Birdman had
led nominations with seven nods — produced a few surprises, which injected
Feb
wn
nd
ovthe
ma
bes
the
ere
ven
ysiy of
an
nd
ter
set
ont
lez
on
ude
azz
wke
for
ortcia
ne
ree
mad
h in
s.
my
03
some drama into the race to the Oscars.
“My first caution to Globes winners:
don’t get over-confident,” said Variety
awards editor Tim Gray, warning that the
Globes are often a poor predictor of Oscars glory.
Possibly the biggest surprise of the
Globes ceremony came when Anderson’s
stylish crime caper The Grand Budapest
Hotel took home the prize for best comedy/musical film over Birdman.
“The Grand Budapest triumph throws
something of a curveball into the Oscar
race,” wrote the Los Angeles Times. — AFP
04
01.
Ethan Hawke is said to be in the running
for the Best Supporting Actor award at
the Oscars. Photos by AFP
02.
Will ‘Birdman’ star Michael Keaton snag a
nomination for Best Actor?
03.
Reese Witherspoon is tipped for a
nomination for Best Actress for her role
in ‘Wild’.
04. Multiple Oscar winner Meryl Streep is tipped
to be in the running for the Best Supporting
Actress for Disney’s ‘Into the Woods’.
05.
Starring alongisde Keaton in ‘Birdman’
is Emma Stone, who may be in the
running for the Best Supporting Actress.
PICK OF THE DAY
DANISH shoe manufacturer and retailing giant Ecco keeps things earthy and simplistic
with their AW14 season — now available in Malaysia. The ladies’ collection includes the
futuristic Cleo Boot with premium metallic colours, urban high-pile lining and stylish zipper detailing for a practical yet modern look. Another unique style is the Sculptured 45W
design, contemporary wedge-heeled boots with a clean asymmetrical profile and a statement Green Gables colour that exudes chic. Other pieces in the collection include peeptoe leather heels, loafers and mid-cut boots. The men’s collection features the sturdy and
minimalistic Ecco Darren and Faxon designs, the former stylish and lightweight outdoor
boots with Hydromax-treated leather that repels water, while the latter an understated design that emphasises comfort. Urban leather sneakers and classic dress shoes complete the
collection. Available now at Ecco outlets and selected Parkson and Isetan stores, footwear
in the collection is priced from RM539 to RM789.
05
30
live it!
Zen TODAY
Wealth stays with us a little moment if at all: only our
characters are steadfast, not our gold. — Euripides
LOOKING EAST
PHOTOS FROM WEIBO
Fallen STARS
Jaycee Chan, the latest celebrity brought
down by drug abuse
BY L K TA N
L
ast week’s sentencing of Jaycee
Chan, son of Hong Kong martial
arts superstar Jackie Chan, to six
months in jail and a 2,000 yuan
(RM1,153) fine for drug offences, is the latest evidence of the
increasing prevalence of drug abuse in the
Asian show-business circuit. The reasons cited for substance abuse include “lack of love”,
“mounting pressure” and “depression”. Here
is a look at some recent high-profile cases:
Jaycee Chan, 32
In August 2014, Jaycee was arrested in Beijing
with Taiwanese actor Kai Ko (Ko Chen-tung)
and some 117.7g of marijuana was found in
his home. He has admitted to providing a
venue for drug users four times since 2012.
Ko and Jaycee tested positive for marijuana.
Jaycee was sentenced to six months in
jail last Friday, with the term commencing
from his first day in detention. He will be
released in less than a month — on Feb 13.
It was reported that he was accorded
leniency because of a three-page letter to
his mother, former Taiwanese actress Lin
Feng-jiao, while in prison.
The letter, however, brought to light
his father’s “insufficient love” for him,
and the significant stress Jaycee felt being
born into a celebrity family and living in
the shadow of a megastar.
Li’s performances and endorsement deals were
He admitted struggling to find his own banned after reportedly being blacklisted by the
footing amidst the prospect of a “blank fu- Chinese authorities for drug abuse.
ture”, despite his affluent background.
It is well known that Lin raised Jaycee — Beijing before returning to Taipei.
introduced to drugs by the wrong crowd of
In October, the Taiwan authorities defriends — in the United States and he only ferred their prosecution on the grounds that
saw his busy father occasionally.
Ko had shown remorse and was truthful
about his offences. They granted his request
Kai Ko Chen-tung, 24
to undergo voluntary drug rehabilitation at
Taiwanese actor Ko was set for a successful a Taipei hospital at his own cost.
career after his debut film You Are the Apple
In late 2014, it was reported that Ko risked
of My Eye won him the Best New Actor prize losing 20-odd endorsement deals worth
at 2011’s Golden Horse Awards.
NT$50 million (RM5.6 million) across ChiHowever, his meteoric rise stalled when na and Taiwan.
the news of him and Jaycee being caught
doing drugs shocked the entertainment Li Daimo, 25
world. Ko served a 14-day detention in Another celebrity caught in China’s crackdown on drug abuse among entertainers
is Li Daimo, who gained fame in The Voice
of China.
In March last year, Beijing police arrested the singer and five others, at a Sanlintun
home. The group tested positive for amphetamines and admitted to committing the act
at Li’s home.
A native of Heilongjiang province, Li was
among the first batch of reality-TV celebrities to emerge from the hit show. He has
admitted to taking drugs since 2012 due to
the “immense pressure” of being a celebrity.
He was sentenced to nine months in prison
Jaycee Chan was sentenced to six months in jail and
and fined 2,000 yuan.
also fined last week.
4.98
Hsiao, linked to three drug cases, was reported to
have attempted suicide after a career plunge.
Suzanne Hsiao, 38
Taiwanese actress and singer Hsiao is one
of the most obvious examples of destructive
drug abuse.
Debuting as a fresh-faced beauty at 21,
Hsiao has been arrested thrice since 2006 for
various drug offences. The first offence sent
her to a rehabilitation centre for 49 days. She
was tested positive for cocaine and ketamine.
In the most recent incident, she was granted a conditional release in July 2012, after
spending more than 440 days at the Taipei
Women’s Detention Centre.
Hsiao was a rising star on first entering
the entertainment industry in 1997. She was
groomed by Singapore music gurus Lee Si
Song and Lee Wei Song, who also nurtured
songbird Stefanie Sun Yanzi.
Since her first run-in with the law, Hsiao has
mostly stayed in the limelight only as tabloid
fodder. Despite an announced comeback at a
press conference in Beijing in April 2014, with
the subsequent release of a single, reports later
surfaced in July that she had attempted suicide.
Hsiao was spotted sitting on a window
ledge on the seventh storey of an apartment
after locking herself in her bedroom and was
about to jump when firefighters arrived and
foiled her attempt.
128.98
S P O RT S 3 1
Kvitova to play Pliskova in
all Czech final in Sydney
Two-time Wimbledon champ ends Pironkova’s incredible run
SYDNEY: Two-time Wimbledon
champion Petra Kvitova will play in
the final of the Sydney International
after ending Tsvetana Pironkova’s
incredible run at the tournament
yesterday. The Czech second seed
proved too strong for the plucky Bulgarian defending champion, winning
their semi-final 7-5, 6-1.
Kvitova ended Pironkova’s quest
for a 15th straight win at the Sydney
tournament after the Bulgarian came
through the qualifying rounds to win
the tournament in 2014 and again had
to qualify for the main draw this year.
After a stiff contest in the opening
set the world No 4 finished off Pironkova with the loss of just one game
South Africa,
West Indies seek
World Cup form
BY COL I N B RY DEN
DURBAN: South Africa and
the West Indies square up in
five one-day internationals,
starting today, in their final
competitive matches before
the World Cup starts in Australia and New Zealand next
month.
South Africa will be fielding
their World Cup squad, with
the exception of injured wicketkeeper Quinton de Kock, who
has been replaced for the series
by veteran Morne van Wyk.
The West Indies announced
their one-day squad for South
Africa late last year and the
World Cup squad, announced
last week, shows three changes.
Darren Bravo, Sunil Narine and Kemar Roach will be
playing in the World Cup but
are not in South Africa. Three
players named for the South African series, Carlos Brathwaite,
Narsingh Deonarine and Leon
Johnson, will not be going to
the World Cup.
Outclassed in a Test series,
the West Indies dominated the
first two Twenty20 internationals before losing the third with a
weakened team. They are likely
to be competitive against South
Africa, although the hosts will
start favourites with star players De Villiers, Hashim Amla,
Dale Steyn and Morne Morkel
back in action after missing the
Twenty20 games.
Like South Africa, the West
Indies selected a different captain for each format on the tour.
All-rounder Jason Holder will
lead the one-day side and will
also be in charge for the World
Cup. — AFP
in the second set. Kvitova set up an
all-Czech final with Karolina Pliskova, who was a straight sets winner
in the other semi-final over German
fifth seed Angelique Kerber.
After a slow start that included
losing her opening service game,
Kvitova went to a new level and looks
in good shape for next week’s Australian Open in Melbourne.
A sapping schedule finally caught
up with Kerber. World No 22 Pliskova
enjoyed a comfortable 6-3, 6-2 win
over last year’s finalist. It had been
a tough few days for the German
fifth seed and world No 9 who had
to endure three three-set matches,
including a WTA record late local
time finish at 3.10am on Wednesday after rain delays disrupted the
tournament schedule.
Kerber had little more to offer and
was dispatched in just 55 minutes
by Pliskova.
“I have been playing the whole
week really well,” Pliskova said. “I
won some good matches. Last week
as well in Brisbane I had few good
matches, so I’m feeling good and
happy to play well before Melbourne.”
— AFP
Only a handful of tie-break
points separated the two with neither player’s serve broken during
the match.
The 2009 US Open winner ran
out of steam against the world No
66, who made it six straight wins
in the tournament after three victories in qualifying.
Kukushkin will now play another Argentine fifth seed Leonardo Mayer, who got past French
fourth seed Julien Benneteau, 6-3,
7-6 (7/4).
“It was a tough match,” the former US Open champion said. “I
think he deserve to win because
he played better than me in the
tie-break.
“The match was close. I served
well, but my wrist hurts a little
bit more than yesterday, and I
couldn’t hit harder than my last
match.”
Del Potro was satisfied with
his week’s work and some important match practice ahead of
next week’s Australian Open in
Melbourne.
“I’m happy just to be playing
tennis again against these players.
It will be more interesting for me
and I will be improving faster than
training at home with my coach.”
It was a significant win for Kukushkin, who looms as a potential
roadblock for a seeded player at
the Australian Open. — AFP
Dhoni keeps silence on shock Test retirement
MELBOURNE: Mahendra Singh
Dhoni (pic) would not elaborate
yesterday about his sudden retirement from Test cricket, ahead of
leading India in the one-day international tri-series against Australia
and England.
The 33-year-old stunned the
cricket world — and a completely
unaware India team — when he
announced his immediate Test retirement after the drawn third Test
against Australia in Melbourne late
last month.
He had not mentioned it during
his post-Test media conference,
only for Indian authorities to drop
the bombshell via social media
shortly afterwards.
India’s World Cup-winning
captain again had nothing to say
on the subject as he launched the
Indian one-day team’s new uniform yesterday ahead of their first
tri-series game against Australia in
Melbourne on Sunday.
Dhoni, who remains India’s ODI
and T20 captain, stood next to new
Test skipper Virat Kohli and six
other-teammates on stage with the
closest he came to addressing the
issue when he was asked about his
German skater Pechstein
earns key court win over ISU
BERLIN: A German court yesterday allowed a lawsuit by fivetime Olympic champion Claudia Pechstein seeking damages
from the International Skating
Union (ISU) over a doping ban
to be heard, handing her a key
win in her ongoing battle with
the ISU. It is the first time a German civil court has allowed a
case to be heard after the world’s
top sports court, the Court of
Arbitration for Sport (CAS), has
ruled against it, setting a precedent for potential similar cases. “The ISU took everything
from me but I keep on fighting,”
Pechstein told reporters. “I now
have the chance in a proper
court, a German court. There I
am confident because the ISU
must now prove that I doped.
There will never be a positive
test from me.” — Reuters
Morgan closes door on
Pietersen return
Kvitova after winning her semi-final
match against Pironkova at the Sydney
International tennis tournament
yesterday. Photo by Reuters
Kukushkin ends Del Potro’s
winning comeback in Sydney
SYDNEY: Juan Martin del Potro’s
winning comeback after 10 months
out through injury was ended by
qualifier Mikhail Kukushkin at the
Sydney International yesterday.
The Argentine defending champion, who spent much of last year
recovering from wrist surgery, was
knocked out in two tie-breaker
sets by the Kazakhstan qualifier,
7-6 (7/5), 7-6 (7/3) in just under
two hours.
Del Potro, who beat Sergiy Stakhovsky and top seed Fabio Fognini
to reach the quarter-finals after he
was awarded a wildcard into the
tournament, fought to the end,
but found Kukushkin too strong
on the day.
IN BRIEF
time off since that Test.
“It has been good, a few days
off,” he said.
And that was it. There were a
few prepared comments about the
uniform, but no questions were
allowed from the assembled journalists.
The microphone was handed to
Kohli, one of the few Indian players
to enhance his reputation during
the 2-0 Test series loss to Australia.
“It’s been a very eventful month
and a half since we came to Adelaide,” Kohli said. “I’ve enjoyed
every day of it. It’s been challenging
at times, but that’s where international cricket is.”
Dhoni, who is one of the world’s
highest earning sportsmen, was India’s most successful Test captain,
winning 27 of the 60 Tests he led
the national side in, with 18 losses
and 15 draws. — AFP
SYDNEY: Eoin Morgan said yesterday unwanted Kevin Pietersen
is not part of his plans as England’s one-day captain and he
is happy with his group of players ahead of next month’s World
Cup in Australia and New Zealand. Morgan, who took over the
England captaincy from Alastair
Cook last month, moved to end
speculation surrounding the future of the maverick batsman,
sacked by England last February.
Pietersen renewed speculation
during a television interview this
week with former Australia captain Ricky Ponting during a Big
Bash League match when he
claimed Morgan wanted to have
him back in England’s 50-over
team. — AFP
Hockenheim to host German
GP, says Ecclestone
LONDON: Hockenheim will host
this year’s German Grand Prix
instead of alternating with the
Nuerburgring, Formula One’s
commercial supremo Bernie Ecclestone told Reuters yesterday.
“It’s going to be at Hockenheim ...
It can’t be Nuerburgring because
there’s nobody there,” said the
84-year-old Briton. Hockenheim
hosted last year’s German race
under an agreement to alternate
with the Nuerburgring, which
is under new ownership. The
2015 calendar does not currently specify a venue for the July 29
race, however. — Reuters
Anderson battles into semis
at Auckland Open
AUCKL AND: South Africa’s Kevin Anderson scored a
gutsy win over American Steve Johnson yesterday to make
the semi-finals of an Auckland
Open tournament blown wide
open by high-profile withdrawals. Anderson downed Johnson
6-4, 7-6 (10/8) to give himself an
excellent chance of claiming his
third career ATP title in a severely weakened field. The world No
16 is the only remaining player
in the top 20 and the only one
to win an ATP title, with none
of his rivals even making a final
on the tour before. — AFP
3 2 S P O RT S
Simeone junior keen to
make his own name
Making waves in under-20 Argentina team
BUENOS AIRES: Giovanni Simeone
wants to be known for his skills and
not as the son of Atletico Madrid
coach Diego Simeone after impressing in a two-goal performance
for Argentina’s under-20 side.
Argentina crushed Ecuador 5-2
in their opening match of the South
American under-20 championship
in Uruguay on Wednesday with
striker Simeone helping himself
to a brace of goals.
“I had a hard time trying to make
my teammates understand I’m not
a different [sort of ] person, I haven’t come here because I’m the
son of [someone famous],” the Madrid-born 19-year-old told the Argentine sports daily Ole.
“I’m trying to show my skills
Iran ride wave
of support into
Asian Cup
last eight
BY N I CK MU LV ENNEY
SYDNEY: Iran stormed into the
Asian Cup quarter-finals on
a wave of passionate support
with a 1-0 win over Qatar in
their second Group C match
at Stadium Australia yesterday.
Striker Sardar Azmoun
scored the only goal in the
52nd minute to send the vast
majority of the 22,672 crowd
home happy and the threetime champions into the last
eight for the sixth straight
Asian Cup.
Qatar, who had come into
the tournament with high
hopes after winning the Gulf
Cup at the end of last year,
failed to get a shot of note on
target and will now go home
after their final group match
against Bahrain on Monday.
Iran finished the first half
strongest and Sardar had already had a chance to break
the deadlock in the 46th minute but poked the ball wide of
goal with his left foot after Qatar goalkeeper Qasem Burhan
had failed to deal with a corner.
The 20-year-old made no
mistake six minutes later when,
receiving the ball on the edge
of the box , he turned defender Almahdi Ali Mukhtar and
slipped the ball into the net.
The stadium exploded with
noise and Sardar, the only
change from the side that beat
Bahrain 2-0 in their tournament opener on Sunday, raced
to the corner to be embraced
by a mob of fans. — Reuters
and personality,” added Simeone,
who has already had first division
experience with River Plate, where
he made his league debut in August 2013.
Argentina are looking to qualify for the world under-20 championship they have won a record
six times.
The top four teams in the tournament that ends on Feb 7 will
go through to the May 30 to June
20 world championship in New
Zealand.
The winners will also qualify for the Rio 2016 Olympic
Games, unless hosts Brazil are
champions, in which case the runners-up will go through with them.
— Reuters
Argentina’s Simeone celebrating after scoring a goal past Ecuador’s goalkeeper
Edison Recalde during their Group A soccer match for the South American Under-20
Championship in Colonia on Wednesday. Photo by Reuters
Barca’s quest for silverware this
season has been disrupted in recent weeks by off-field problems,
with reports swirling about a rift
between Luis Enrique and Messi.
Messi is apparently unhappy
with the coach’s management style
and tactics and is said to be seeking
an exit from the club he joined at
the age of 13.
Barca president Josep Bartomeu,
who this month sacked sporting
director Andoni Zubizarreta and
called early elections for later this
year amid criticism of his running
of the club, played down the reports
late on Wednesday.
“I have contact with him [Messi]
and he is happy, with a lot of ambition and desire to win,” Bartomeu
told Catalan radio.
“He told me he wants to end his
career at Barca and his commitment is absolute,” Bartomeu added.
“There is no debate about his
future, he already said he wants
to stay and he has a contract here
[until 2019].”
Asked about Messi’s relationship with Luis Enrique, Bartomeu
said: “We are closing this debate
because it does not exist. I will
not characterise his [the coach’s]
relationship with the dressing
room, I am a discreet person.”—
Reuters
UAE score record-breaking goal in 14 seconds
REUTERS
BY P ETER HU TC HI S O N
CANBERRA: United Arab Emirates
striker Ali Mabkhout (pic) scored
after 14 seconds yesterday — the
fastest goal in Asian Cup history
— to propel his side towards a 2-1
win over Bahrain.
The Group C victory in Canberra marked the first time UAE had
won their opening two matches
at the tournament and set them
on the way to qualifying for the
quarter-finals.
Omar Abdulrahman clipped a
superb ball over the top of Bahrain’s defence and Mabkhout
calmly controlled it with his right
foot before slotting past goalkeeper
Sayed Abbas with his left.
It was Mabkhout’s third goal
of the Asian Cup after a double
in UAE’s opening 4-1 win against
United sack scout over
Facebook posts
LONDON: Manchester United
have sacked one of their European scouts over claims he
posted racially offensive comments on Facebook. According to a report in Britain’s The
Guardian newspaper, Denmark-based Torben Aakjaer
published anti-immigration
posts on the social media website, although it appears these
have now been removed. United suspended Aakjaer after
the allegations became public and, late on Wednesday,
the English football giants announced they had sacked the
Dane. “We have terminated
our association with him [Aakjaer],” a United spokesman
said. — AFP
Queiroz hails ‘brilliant’
Azmoun strike
Messi, Neymar rested for
Cup game at Elche
BARCELONA: Barcelona coach Luis
Enrique decided to rest Lionel Messi, Neymar and most of his regulars
for the King’s Cup last 16, second
leg match at Elche late yesterday.
Barca have a 5-0 lead from last
week’s first leg at the Nou Camp
and Luis Enrique has called up
six players from the B team for the
return game.
Playmaker Xavi and defender
Thomas Vermaelen missed the
match due to injury, while centre
back Gerard Pique and midfielder
Ivan Rakitic are the only players
included who started Sunday’s 3-1
La Liga win at home to Atletico
Madrid.
IN BRIEF
Qatar on Sunday, making him the
tournament’s top scorer.
Quick goals have been scored
at the competition before, notably
China’s Xie Yuxin in 1992 and Ku-
waiti Fat’hi Kameil in 1976 which
both came in the first minute, but
organisers said Mabkhout’s was
the quickest ever.
“I’m so happy about that,” the
forward said.
Midfield wizard Abdulrahman
was named man of the match and
was equally delighted about his
good friend’s strike.
“I’m very close to Mabkhout
and I’m delighted he’s scored three
already,” said Abdulrahman.
Iran defeated Qatar 1-0 later
yesterday, confirming UAE’s progression to the knock-out stages.
UAE enjoyed more of the ball
in the opening stages, but Bahrain
gradually came into the match after the shock of conceding so early
and always looked dangerous up
front through Nigerian-born striker Jaycee Okwunwanne. — AFP
SYDNEY: Iran coach Carlos
Queiroz hailed Sardar Azmoun’s “brilliant” winner
against UAE in the Asian
Cup and said it was worthy
of some of the best strikers he
had worked with. The former
Real Madrid, and Portugal
boss and Manchester United
assistant has coached some
of the best in the business
but he was unstinting in his
praise for the 20-year-old. “It
was a brilliant goal. It was a
special movement of the centre forward, a great turn at the
level of some of the best centre forwards I have worked
with in my life,” Queiroz said.
— AFP
Townsend calls for
Soldado support
LONDON: Tottenham Hotspur winger Andros Townsend
has called on the club’s players to help Roberto Soldado
end his barren spell in front
of goal after the striker produced a contender for miss
of the season on Wednesday.
Spurs came from 2-0 down
to knock Premier League rivals Burnley out of the FA Cup
with a 4-2 third-round replay
win at White Hart Lane. But
despite all the goals, many
fans left Spurs’ north London headquarters wondering
how Soldado had hit the bar
from close range in the first
half. — AFP
Morrison cleared of
assault charges
LONDON: An English court
yesterday cleared West Ham
United midfielder Ravel Morrison of charges of assaulting his former girlfriend and
her mother. The 21-year-old
was accused of hitting Reah
Mansoor, 19, and her mother, Parveen Mansoor, 39, after an evening at a nightclub
in his home city of Manchester on July 24. Morrison was
to stand trial at Manchester
Crown Court this month but
the charges were dropped by
the prosecution yesterday
and the player, who was not
in court, was found not guilty.
— AFP

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