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MONDAY APRIL 13, 2015 ISSUE 1938/2015
FINANCIAL
DAILY
MAKE
BETTER
DECISIONS
www.theedgemarkets.com
6 HOME BUSINESS
HK investors
propose RM142b
concrete deck
island for Penang
7 HOME BUSINESS
Six Flags keen on
Malaysian entry
8 HOME BUSINESS
Hovid eyes
to market first
Malaysian drug
globally
18 F O C U S
New Oysterflex
bracelet reimagines
the rubber strap
23 W O R L D B U S I N E S S
Commodity giants’
S’pore trading hubs
under fire
Dr M: Set up independent
panel for 1MDB probe
14 H O M E
10.90
2
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
For breaking news updates go to
www.theedgemarkets.com
ON EDGE T V
www.theedgemarkets.com
EPF in talks
to divest UK
property assets
Expensive
homes call for
smaller public
housing units
ECB likely to continue
bond buying
Chief Draghi expected to give ‘short shrift’ — analysts
FRANKFURT: The European Central Bank’s (ECB) decision makers
will meet on Wednesday, buoyed
by the successful debut of a mass
bond-buying spree designed to
kick-start growth and will likely quash talks of it wrapping up
early.
Analysts said ECB chief Mario
Draghi is expected to give short
shrift to any suggestion of a premature end to the quantitative
easing (QE) programme, the
long-awaited and controversial
gambit launched by the central
bank last month.
Amid ongoing uncertainty
about cash-strapped Greece, the
first volley of the ECB’s US$1.2
trillion (RM4.39 trillion) scheme
offered some good news, getting
off to a solid start by meeting its
target.
That has fed speculation
that the anti-deflationary policy of buying around €60 billion
(RM232.74 billion) of public and
private bonds each month could
be stopped before its planned
September 2016 end date.
But Royal Bank of Scotland
economist Richard Barwell said
he doubted Draghi will follow
such a course as confidence in the
ECB’s future actions is so crucial
to the current markets.
“Therefore, we should expect
the driver’s determination to complete the journey to be a central
theme in the ECB’s communica-
tion strategy,” he said, ahead of the
regular policy-setting governing
council’s meeting in Frankfurt
this week.
Launched on March 9, the
strategy behind the ECB’s QE
programme is akin to those of
the US Federal Reserve and the
Bank of England to pump money
into the eurozone, with massive
purchases of debt to bring down
borrowing costs and in turn foster
easier credit.
“A success,” remarked Berenberg Bank economist Christian
Schulz after nearly €61 billion in
government and corporate debt
was purchased in the first round,
despite fears of a possible shortage of assets to buy. — AFP
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Private capital forsakes Asia
BY ANDY M U K HE RJ E E
SINGAPORE: Private capital looks to
have fled Asia to the tune of US$160
billion (RM585.6 billion) in 2014,
leaving the region’s central banks
scrambling for dollars to add to their
reserves. Those economies doing
most to reform, like India and Indonesia, seem the best at keeping
investors keen.
In 2014, the 10 large Asian economies outside Japan earned a combined surplus of US$413 billion from
trade, their biggest in five years. Normally, when money comes in, central banks add to their stockpiles
of hard-currency assets to prevent
exchange rates from rising too fast.
Last year, though, they hardly had to
lift a finger. At US$47 billion, reserve
accumulation was the weakest since
the 1997 Asian crisis.
Where did the rest go? Currency
moves will have wiped away some
of it. It is said Asian central banks
follow the global trend of having
three-fifths of their reserves denominated in US dollars, a quarter in
euros and 8% split between the yen
BY C H R IS T IN E L IM
KUALA LUMPUR: Standard Chartered Bank Malaysia sees strong
growth and demand for wealth
management products and services
in Malaysia.
Managing director and chief executive officer Mahendra Gursahani said the country is the second
largest wealth management market
for Standard Chartered in Asean.
“Our network advantage puts
us in a strong position to facilitate
trade and investment in Malaysia
with our presence in all 10 Asean
countries,” he told Bernama in an
interview recently.
He said Standard Chartered’s
footprint markets, comprising Asia,
Africa and the Middle East, are expected to account for 60% of the
global growth in high net worth
individuals’(HNWI) personal financial assets over the next three years.
It was reported that rising wealth
in Asia has spurred Standard Chartered to focus on the growth in
wealth management, targeting
HNWI for the banking group’s business division in China.
Mahendra said the bank is investing in better technology and
standardising platforms across
networks in order to improve client experience through easy and
convenient banking. — Bernama
Bank Negara: 99%
have access to
banking services
and the pound. A stronger doller
would have erased US$205 billion
of the region’s overall reserves. But
even after accounting for that, there
is still US$161 billion of the trade
surplus unaccounted for.
The simple explanation is that the
private sector has taken the money
elsewhere, and there is one likely
culprit: Asia’s fading gross domestic
product (GDP) growth. China, which
is courting a GDP increase of just 7%
this year, the lowest since 1990, accounted for a third of the estimated
outflows. South Korea and Singapore are being hit by anaemic world
trade. Elsewhere, Asia’s chronic weak
governance is worsening. Thailand
and Malaysia wed shaky leadership
with high household debt. — Reuters
Thai police detain man after Samui car bomb
BANGKOK: Thai police have detained a man suspected of involvement in a car bomb on the
resort island of Samui that wounded seven people, authorities said
yesterday.
Military officers detained the
man for questioning late Saturday
in Nonthaburi Province, on the
northern outskirts of Bangkok, in
connection to the explosion, national police spokesman Prawut
Thavornsiri told AFP.
“Authorities have brought in a
Stan Chart sees
strong growth
in wealth
management
man for questioning after finding
a threatening post on his Facebook page,” Prawut said, adding
the post appeared last Friday before the blast.
“As far as I know, he is still in
military detention for further investigation,” he said.
Security in the tourist hub has
been tightened since the car bomb
in a mall parking lot went off last
Friday, injuring six Thais and a
12-year-old Italian girl.
Extra police officers have since
been deployed as Thailand enters
the busy Songkran new year holiday period, Prawut said.
“We have sent more police to
check the airport and ferry port,”
he added.
The blast came a week after Thailand’s junta, which seized power
last May, replaced martial law with
sweeping security powers retaining
the military’s control, including the
right to arrest and detain people for
crimes such as breaching national
security. — AFP
SEMPORNA: Ninety-nine per cent
of Malaysians have access to banking services at bank branches or
through banking agents, says Bank
Negara Malaysia.
Its Director of Development Finance and Enterprise Marina Kahar
said the central bank introduced
the banking agent initiative in 2012
under the 2011-2020 Financial Sector Masterplan.
She said nationwide, 96% of
mukims with a population exceeding 2,000 now have access to basic
banking services compared to just
46% in 2011.
Banking agents nationwide perform 34 million transactions worth
RM3.5 billion, she said at the presentation of AgroAgent appointment certificates and the opening
of AgroBank’s Semporna branch by
Agriculture and Agro-based Industry Minister Datuk Seri Ismail Sabri
Yaakob here yesterday.
AgroAgents may be based at post
offices, petrol stations, chain stores
or sole proprietorships, and offer
rural residents basic services such
as cash deposits and withdrawals,
she said.
Banking transactions may also
be made at offices of area farmers’
organisations and fishermens’ associations or the nearest Agrobazaar, and are safe, fast and easy,
she added. — Bernama
4 HOME BUSINESS
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
Ewein eyes
next Tanjong
Pinang project
Company has high hopes of being chosen because
of its current relationship with CZBUCG
BY KA NG SI EW L I & CHESTER TAY
KUALA LUMPUR: Ewein Bhd,
which is developing its first property project valued at RM800 million at Bandar Tanjong Pinang,
Penang in a joint venture (JV) with
Consortium Zenith BUCG Sdn Bhd
(CZBUCG), is looking to bag the
next parcel of land the latter will
be offering for development there.
It expects the next project to be
up for grabs in the second half of
this year.
“We are now working closely
with CZBUCG to explore the potential [development] of the next
parcel of land measuring 4.29 acres
(1.73ha). It will also require the
approval of the Penang Island City
Council on the planning permission
for the proposed development,” Ewein managing director Datuk Ewe
Swee Kheng told The Edge Financial Daily in an interview last week.
He declined to reveal the details,
but that it is likely to be another
high-rise residential development.
It is understood that the second
project will have a gross development value (GDV) of RM1 billion.
On March 31, 2015, Ewein (fundamental: 1.1; valuation: 1.4),
through Ewein Zenith Sdn Bhd, a
60:40 JV between Ewein and CZBUCG, received planning permission from the Penang Island City
Council to develop luxury serviced
apartments on a 3.67-acre piece of
freehold land in Bandar Tanjong
Pinang.
Dubbed “City of Dreams”, the
project features two blocks of
38-storey towers housing a total
of 572 units, with built-ups ranging from 1,100 sq ft to 2,350 sq ft.
Ewe said the sea-fronting serviced apartments will be priced from
RM1,200 per sq ft, which is relatively
lower than Eastern & Oriental Bhd’s
high-end condominiums at Seri
Tanjung Pinang nearby which are
going for RM1,800 per sq ft.
Ewe pointed out that while Ewein Zenith was chosen to develop
the City of Dreams project, it is
not guaranteed that it will be the
chosen developer to undertake
the remaining parcels of land in
Bandar Tanjong Pinang.
“Of course, we (Ewein) have high
hopes of being chosen because of
our current relationship with CZBUCG. That’s why we must ensure
that our first project (City of Dreams)
is successful. If we do the project
well, there is no reason why the relationship cannot continue,” he said.
CZBUCG executive vice-chairman Datuk Lee Chee Hoe con-
Ewe said the group expects “exciting times” in FY16 as earnings contribution from its
property development starts rolling in.
curred, saying Ewein Zenith can
then focus on property development while CZBUCG will focus on
construction projects.
Bandar Tanjong Pinang entails
110 acres of reclaimed land in Tanjung Pinang that was given to CZBUCG by the Penang state government as compensation-in-kind for
the building of the RM6.3 billion
Penang Undersea Tunnel, which
includes three road bypasses.
Lee said Bandar Tanjong Pinang
is estimated to have a GDV of RM25
billion over the next 10 years.
According to Ewe, Bandar Tanjong Pinang will comprise a combination of residential and commercial properties, but the proportion
will depend on prevailing property
market conditions.
“We have a masterplan [for Bandar Tanjong Pinang], but it is subject to change according to market
conditions,” he added.
Ewein, which is diversifying its
revenue stream from manufacturing of precision sheet metal fabricated parts to include property
development, expects moderate
growth for the current financial
year ending Dec 31, 2015 (FY15)
as the sluggish demand from the
electronics and electrical sector
continues.
The group saw net profit for FY14
grow 110.3% to RM3.46 million
from RM1.65 million in FY13 on
higher contribution from its investment holding activities.
However, revenue fell 14.2% to
RM44.63 million from RM51.99 million due to a slowdown in orders
caused by lower demand for home
appliances electronics.
Ewe said the group expects “exciting times” come FY16 as earnings
contribution from its property development starts rolling in.
Ewein Zenith will launch the City
Of Dreams project in the middle of
this year, with construction work to
begin in the second half and completion within 48 months.
“We expect revenue contribution
from the property development
segment to outpace all other segments from FY16,” said Ewe.
He sees Ewein Zenith reaping
RM200 million in gross profit from
the City Of Dreams project over four
years starting from 2016.
“The land cost [for the 3.67-acre
parcel] was RM133 million, while
the total development cost is estimated to be more than RM400
million,” he said.
Ewe is a substantial shareholder of Ewein, with a 43.05% stake.
Ewein shares closed unchanged at
60 sen last Friday, giving it a market
capitalisation of RM126.56 million.
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.
ABN loan was subject
of debate in Dewan
Rakyat two years ago
BY T E R E N C E F E R N A N D E Z
KUALA LUMPUR: The RM450 million loan from Bank Pembangunan
to Asian Broadcasting Network (M)
Sdn Bhd (ABN) was the subject of
heated debate in Parliament two
years ago.
Deputy Finance Minister Datuk
Ahmad Maslan outlined the loan
agreement following repeated questioning by Pakatan Rakyat MPs led
by opposition leader and Permatang
Pauh MP Datuk Seri Anwar Ibrahim
and Pandan MP Rafizi Ramli.
Responding during question time
on July 16, 2013, Ahmad Maslan
said the loan is for seven years at
an interest rate of 7.8% per annum.
According to the Hansard, the
loan totalled RM450 million with
the equity portion being RM192
million. Cost of the project was
RM642 million while the debt to
equity ratio was 70:30.
“At that time only RM50 million
was withdrawn; to withdraw another
RM150 million, ABN has to complete
cable networks of 855,000 homes,”
he explained to the MPs who questioned the loan, which included Barisan Nasional’s Kinabatangan rep
Datuk Bung Mokhtar Radin.
The drawdown of the full loan
will only be allowed once 1,575,000
houses are wired.
ABN which was launched in mid2013 has around 50,000 subscribers.
He said the loan was approved
by the group credit committee on
May 18, 2012 based on three criteria: intense credit and technical analysis by consultants Frost
& Sullivan; the appointment of an
independent checking engineer to
verify the project costs and a RM1
billion collateral by ABN’s largest
shareholder Tan Sri KK Eswaran.
Ahmad Maslan said the assets
were “cash in hand, cash in the bank,
quoted and unquoted shares, landed properties and other properties.”
The Edge Financial Daily on
April 7 reported that ABN was
facing financial problems which
caused it to close its news division
and studio division, taking ABN
News off the air and its accompanying news portals offline. Over 60
staff were also retrenched.
Hansard records, meanwhile,
show that on July 11 and 13 Finance
Minister II Datuk Seri Ahmad Husni Hanadzlah was grilled over the
merits of the loan, raising fears that
if the venture fails, people’s money
would be at risk.
“Funding another cable television project is not an infrastructure
project ... it is a commercial project,”
said Rafizi on July 11, adding that as
a commercial project, ABN should
have the competitive edge to get a
loan from a commercial bank.
Anwar questioned the special
treatment accorded to KK Eswaran
as he was awarded a cable TV licence followed by a loan from a
bank that is guaranteed by the government. “This while thousands of
bumiputera entrepreneurs cannot
even approach Bank Pembangunan,” he said.
Ahmad Husni reasoned that
Bank Pembangunan had studied
the business plan where the limit
for loans to commercial entities is
RM500 million and government
agencies RM1.77 billion. He said
the bank’s credit committee appointed Frost & Sullivan to conduct
a credit and technical analysis of
the business plan.
“The consultants also appointed an independent engineer; so
procedures had been followed,”
Ahmad Husni said, refuting allegations that the bank was forced
to approve the loan following “instructions from the top”.
ABN assures partners it has never
defaulted on its debt servicing
BY T E R E N C E F E R N A N D E Z
KUALA LUMPUR: In a letter to its
business partners and associates,
the company addresses “recent
media reports alleging that ABN is
unable to service its bank borrowings and is in financial trouble”.
President and chief executive
officer Sreedhar Subramaniam
said in the letter that the company has only drawn down half
the amount, which worked out
to RM225 million.
(The Companies Commission
of Malaysia records list the loan
status as “fully released”.)
“ABN has never defaulted on its
debt servicing,” said Sreedhar in
the letter which The Edge Financial Daily was able to get a copy of.
But he then went on to say:
“While there may be payment
processing delays, we have always
endeavoured to keep up to date
for most of our essential expenses,
including salaries.
“Any suggestion that ABN has
incurred severe losses and will
not be able to meet its financial
obligations is completely untrue.
“The terms of the drawdown are
being worked out and ABN stays
committed to complete the project
and honour its obligations to all its
business partners,” the letter went.
With regard to the shutting down of its news division,
Sreedhar said the decision was
purely commercial and “reflects
ABN’s prerogative to make business decisions to meet its stakeholders’ objectives”.
In assuring its associates and
partners not to be “anxious” about
the reports, Sreedhar went on to
say that the article contained misleading statements and inaccuracies and that the company will be
taking legal action.
6 HOME BUSINESS
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
HK investors propose
concrete deck island
To avoid environmental impact from Middlebank reclamation for PTMP
BY SA NGEETHA AM ARTHALINGAM
KUALA LUMPUR: Two Hong Kong
investors have proposed to the
Penang state government to build
a concrete deck island measuring
2,500ha instead of reclaiming the
Middlebank in a land swap deal for
the RM27 billion Penang Transport
Master Plan (PTMP).
State Local Government, Traffic
Management and Flood Mitigation
committee chairman Chow Kon
Yeow told the media last month
that the 15-year PTMP would be
funded via a land swap deal.
The land swap business model, involving the 607ha Middlebank land, is similar to the funding agreement with Consortium
Zenith BUCG Sdn Bhd which received 110 acres (44.51ha) of land
after being tasked to build the RM6.3
billion Penang Undersea Tunnel.
Requesting anonymity, the
source told The Edge Financial Daily
that the foreign investors have offered a private financing initiative
solution to the PTMP by building
a concrete island platform dubbed
Menapolis (elevated water city) instead of reclaiming Middlebank
to resolve fears of environmental
impact.
It is believed that the 15-year
five-phased Menapolis project that
could house a population of 250,000
by 2030, is expected to feature electronic, electrical, industrial, commercial, residential and hospitality
developments.
It would also incorporate green
energy technology, health services,
government offices, recreational
parks, an artificial beach, as well
as security and safety services, the
source said.
This latest revelation adds a twist
to the conditions related to the deal
offered by the Penang government
if it chooses to accept the concrete
deck island proposal tagged at a
gross development value of RM142
The land value is
based on land prices
in Singapore, Japan,
Hong Kong and Japan
because of facilities
that would be made
available such as
renewable energy and
mixed development
The proposal by the Hong Kong
investors is not new to Penang as it was
once suggested but rejected by Guan
Eng. The Edge file photo
billion, the source said.
The source added that the cost
of building the decks would, however, require cross financing and
expertise, which the investors were
already privy to, including that
from the Dutch Hydraulics Institute (DHI).
The source said the Hong Kong
investors, represented here by independent strategic adviser Datuk Dr
Nik Zamri Majid, and who are also
involved in property developments
in China, had suggested that the
offshore concrete decks be built off
Gertak Sanggul near Pulau Kendi.
The source said the plan was for
the appointed project delivery partner (PDP) for the PTMP to purchase
the rights from the Hong Kong investors to develop the decks while
earning construction and development profits profits.
The contractors are expected
to earn between 20% and 25%
profit from the deck development,
while the state government would
benefit through local and foreign
investments, and upstream and
downstream industrial activities,
the source said.
“It is believed that the contractor would be able to earn profits
from the construction of the PTMP,
Menapolis, development on the
decks and from the sale of the developments,” the source said.
The proposal by the Hong Kong
investors is not new to Penang as
it was once suggested but rejected
by Chief Minister Lim Guan Eng in
January 2013, said the source, adding that this would be the biggest
concrete deck in the world.
Back then, a Kuala Lumpur-based company Al Cube Sdn
Bhd consisting of local and Hong
Kong investors proposed to build
a RM75 billion “offshore concrete
structure for industrial development” on stilts in Balik Pulau.
It was to feature electrical and
electronic, and oil and gas industries, government offices, schools,
hotels, residences, parks, and an
artificial beach, and house about
half a million people.
When contacted, Nik Zamri, who
was also its then project consultant, declined to comment on the
investors’ latest venture in Penang.
“This time, the investors who
were represented by a local alliance,
proposed the solution to land reclamation to the state during a PTMP
briefing in Komtar on March 9.
“They admitted their inability in
fulfilling the entire requirement in
the PTMP (consisting of recommendations to reduce traffic congestion)
but were certain they could solve
the issue of land reclamation,” the
source said.
The source said the investors
predicted a value of RM750 per sq ft
for the decks when completed. The
investors believed concrete decks
reduced environmental impact.
“The land value is based on land
prices in Singapore, Japan, Hong
Kong and Japan because of facilities
that would be made available such
as renewable energy and mixed development,” the source said.
However, the source said the investors were also keen on working
with the PDP to build the tramway
at an estimated cost of between
RM850 million and RM1 billion
on the island.
The source said the investors
were aware that most of the bidders
for the PTMP were “not very keen”
on building the tramway because
of the low returns.
“Thus, the investors are willing
to work with the PDP to build the
19km tramway from Weld Quay to
the Penang International Airport.
Its local alliance is believed to have
been approached by leading trams
and rail manufacturers to develop it.
“They include German Siemens
AG which would be using Chinese
technology, and plane and train
maker Canadian Bombardier Inc.
The investors might seek help from
French contractor Vinci Construction Grande Projets.
“The local alliance, who is said
to have ample experience in this
field, has spoken to the bidders to
offer the investors’ services as well
as the proposal to build the concrete decks.
“If the investors’ proposal is accepted, DHI will be tasked to conduct the environmental impact assessment,” the source added.
Proposal raises interest and reservations
BY SA NGEETHA AM ARTHALINGAM
GEORGE TOWN: A private financing initiative (PFI) solution offered
by two Hong Kong investors to
the state government to build a
2,500ha offshore concrete island
deck has raised both interest and
reservations.
Declining to be named, an expert in the land reclamation industry told The Edge Financial Daily that the RM142 billion project
proposed as an alternative to the
Middlebank reclamation would
serve the same purpose.
“The development would serve
the same purpose whether the
land is reclaimed or if it featured
concrete decks,” said the expert,
adding that the reclamation cost
would also be less than half the
decks’ gross development value.
The concrete deck island,
dubbed Menapolis (elevated water city), has been proposed by
the investors through local independent strategic adviser Datuk Dr
Nik Zamri Majid as the means to
finance the RM27 billion Penang
Transport Master Plan (PTMP).
The investors, who were among
six bidders who submitted their
proposals for the 15-year PTMP
project, were said to have highlighted the environmental advantages the sea decks would have
over reclamation.
To this, the expert questioned
the investors’ reason in taking extra
risks of building concrete decks because human lives were involved.
“When we build something
loosely anchored, it becomes more
risky than reclaimed land,” the
expert said.
Meanwhile, Raine & Horne
(Penang) director Michael Geh
told The Edge Financial Daily that
the land price, which the investors
valued at RM750 per sq ft when
completed, was dependent on the
permissible usage on the platform.
“It is difficult to say if the land
value is fair or not because we do
not know the actual permissible
usage and density allowed by the
state. That would depend on the
density level allowed by the state
government,” he said.
While Geh is unable to comment further because the project
is still at proposal stage, he said
the project’s value should also
take into account its proximity to
Gertak Sanggul, a less developed
area where the land value would
be lower. Sarawak’s
exports last
year up 7%
to RM116.67b
KUCHING: Sarawak recorded
an export value of RM116.67
billion last year compared
with RM108.4 billion the previous year — an increase of
7%.
Sarawak Matrade (Malaysia
External Trade Development
Corporation) director Leany Mokhtar said according
to figures released by the Statistics Department recently,
the state’s export value was
RM103.63 billion in 2012.
She said natural gas and
manufactured goods dominated Sarawak’s main exports,
representing 64.59% of total
exports last year, followed by
petroleum and petroleum-related products at 24.85%.
“Others included fixed
vegetable oils, fluid or solid, crude, refined or purified
(8.4%), veneers, plywood, particle boards and other woods
(4.92%), and non-ferrous metals (2.8%),” she said.
She said Japan remained
Sarawak’s major export destination, accounting for 45.52%
of Sarawak’s export value,
followed by Peninsular Malaysia (18.56%), South Korea
(12.45%), Taiwan (9.87%) and
China (7.9%).
On Sarawak’s cross-border
trade with Kalimantan Barat,
Indonesia, Leany said Sirikin
and Tebedu were the two main
border points. — Bernama
Melaka medical
centre gearing
for expansion
BY C H R IS T IN E L IM
KUALA LUMPUR: Mahkota
Medical Centre Melaka, the
largest private hospital in
southern Peninsular Malaysia, is investing about RM200
million to build a new 500-bed
hospital block.
Chief executive officer Stanley Lam said the new block,
on a parcel of land adjacent to
the existing 270-bed hospital
building, will be ready in two
to four years.
Lam said the hospital,
owned by Health Management International Ltd (HMI),
a company listed on the Singapore Exchange, has more than
300,000 patients annually, with
more than 30 of them foreigners, mainly from Indonesia.
“Every year our patient
numbers increase by more than
6%. There has been an increase
in medical tourism in Malaysia, which can provide equally
good medical treatment at a
fraction of the cost when compared with Singapore,” he said.
The centre, with its niche
in the middle-income group,
has seen a steady increase in
annual revenue of more than
10%. — Bernama
HOME BUSINESS 7
M ON DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY
Six Flags keen on Malaysian entry
It is seeking partner to establish brand here
BY VA SA NTHA GA N ESAN
KUALA LUMPUR: United Statesbased theme park owner and operator Six Flags Entertainment Corp
— known for having some of the
wildest and fastest roller coaster rides
in the world today — plans to enter
the Malaysian market and is seeking
a partner to establish the brand here,
said government matchmaker Malaysia Property Incorporated (MPI).
MPI, whose main function is to
bring in foreign investment into Malaysia’s real estate, had in its latest
Property Quotient Issue 3, 2015,
highlighted Six Flags’ interest in
having a presence in Malaysia.
Six Flags, said to be the world’s
largest regional theme park company with a revenue of US$1.2 billion
(RM4.39 billion), offers world-class
coasters, family rides, animal encounters and water parks.
The business is listed on the New
York Stock Exchange.
“We are matchmaking them,” MPI
general manager Veena Loh said
when contacted by The Edge Financial Daily. She added that MPI was
Loh says Six Flags explored the
possibility of investing here several years
ago, but the venture did not materialise.
Photo by Abdul Ghani Ismail
approached by a Six Flags representative less than a month ago.
According to Loh, Six Flags explored the possibility of investing
here several years ago, but the venture did not materialise.
“They are now looking at a franchise format and for this partner
to run [the] Six Flags [franchise
here] for them,” she added.
MPI, a Malaysian government
initiative under the purview of the
Economic Planning Unit of the Prime
Minister’s Department, serves as a
bridge between foreign investors and
real estate investment opportunities
in Malaysia. It is calling out to any developer or entrepreneur who may be
interested in this Six Flags’ venture.
The article pointed out four potential states most suitable for a Six
Flags’ amusement park — Penang,
Johor (Iskandar Malaysia), Melaka
and Selangor (Sepang).
All these states have high local
and foreign tourist arrivals. Johor,
for example, is expected to have
the highest concentration of theme
parks and amusement parks.
Malaysia is quickly becoming a
popular theme park and amusement park destination in the region
— with the potential of emerging as
the theme park capital of Southeast
Asia, a position comparable to that
of Orlando in Florida, the US.
Last November, The Edge weekly said it had managed to identify
that Malaysia will have at least 50
theme parks by 2020.
The highest concentration of
theme parks will be in Johor with
15, followed by Selangor with 10.
Established theme park operators have started to bring in foreign licensed intellectual properties
(IPs) in recent years to be able to
compete better.
Sunway Bhd (fundamental: 1.5;
valuation: 1.8), for example, has
tied up with US cable television network Nickelodeon to introduce the
Nickelodeon Lost Lagoon, while the
Genting group will, in 2016, have its
Resort World Genting 20th Century
Fox World, a movie-inspired outdoor
theme park.
Australia-based Sanderson Group
International, together with Perak
Corp Bhd (fundamental: 1.9; valuation: 2), have also tied up with
DreamWorks for the development
of an animation theme park in Ipoh,
which is set to open its doors to the
public by the end of this year.
Khazanah Nasional Bhd’s
Themed Attractions and Resorts
Sdn Bhd (TAR) got the ball rolling
when it brought in Merlin Enter-
tainments Group’s Legoland Resort,
which has both a theme park and
a water park in Johor.
TAR has also established the first
Sanrio Hello Kitty Town outside Japan in Nusajaya, together with the
Little Big Club. Next on TAR’s list
is the opening of the Ocean Splash
Water Park and Ocean Quest Marine Park in Desaru, Johor.
Six Flags has 18 parks in the US,
Mexico and Canada. The first Six
Flags outside the US is expected to
open its doors in Dubai, the United
Arab Emirates, in 2017. Its founder,
Angus Wynne, opened the first Six
Flags in Texas in 1961.
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.
TG AgroSolutions eyes
expansion of its operations
BY JEFFREY TA N
KUALA LUMPUR: Malaysia-based
agriculture and plantation firm TG
AgroSolutions Ltd plans to expand
its operations and generate higher
earnings growth after a successful
listing on the National Stock Exchange of Australia (NSX) in February.
The company specialises in cultivating and supplying high-quality
rubber and oil palm seedlings via its
wholly-owned subsidiary TG Agro
Seedlings Sdn Bhd (TGS).
TG AgroSolutions chief executive
officer Datuk Yap Foot Loy said the
firm’s decision to list outside Malaysia was to tap into the international
investor market.
“We want to access the international investor market. The NSX is
one of the top 10 stock exchanges
in the world. It is a good platform
for us to raise funds in the future,”
he told The Edge Financial Daily in
an interview.
He added that the foreign listing
provides more funding options to
TG AgroSolutions, which could be
in “more favourable terms” for the
company.
TG AgroSolutions was listed on
the NSX on Feb 16 via the compliance listing approach.
As defined by the NSX, the compliance listing does not permit a
company to raise any capital in three
months before and after the listing
application.
“We did a compliance listing
where we fulfilled all the condi-
tions attached as a listed company. So, there is no fundraising in
this exercise,” said Yap, who has a
23.81% stake in TG AgroSolutions.
At the end of its first trading day,
TG AgroSolutions closed at A$0.48
(RM1.35), giving it a market capitalisation of A$120.96 million.
According to Yap, the firm is planning to set up two new nurseries
covering 30 to 40 acres (12.14ha to
16.19ha) of land in Peninsular Malaysia — one on the East Coast and
the other on the West Coast.
The expansion is expected to incur a capital expenditure of about
RM2 million to RM3 million, which
will be financed by internally-generated funds.
It will increase the firm’s total
number of nurseries to six from the
current four. Hence, it is expected to
bump up supply of rubber and oil
palm seedlings by an additional five
million units per year at the start.
Currently, TG AgroSolutions has
a capacity to produce not less than
10 million seedlings per year.
“[From the new nurseries], we
expect to go for oil palm first. We
plan to produce 30,000 oil palm
seedlings per month. So, it will be
be 360,000 oil palm seedlings per
year,” said Yap.
Yap said he wants the company
to balance the production of rubber and oil palm seedlings more
equally. At the moment, rubber
seedlings comprise 80% of its total
production.
“By the end of the year, it should
be 50:50. We intend to produce oil
palm seedlings at a minimum of
80,000 to 100,000 units per month,
starting in April,” he remarked.
Yap said the two new nurseries
will be set up via joint ventures with
other companies, but he did not
name the parties involved, which
TG AgroSolutions is currently in
talks with.
In the long term, Yap said the
firm will look to acquire ownership
of land that it intends to operate on,
but he declined to specify where.
The company currently operates
its four nurseries on 130 acres of
leased land.
Yap said TG AgroSolutions will
also enhance its logistics capabilities
by acquiring five new trucks worth
a total of RM1.2 million, which will
deliver seedlings to its customers.
With the expansion plans in
place, Yap is confident that the firm
can achieve a profit-after-tax (PAT)
growth of at least 25% this year.
“It should be better than 2014.
[It will] definitely [be] double-digit growth. We expect to grow by at
least 25%,” he said.
Yap is confident that the firm will
perform reasonably well against
competition, emphasising that it has
the experience, quality and competency to fend off rivals.
Some of TG AgroSolutions’ prominent customers include Sarawak
Plantation Bhd’s wholly-owned
subsidiary Sarawak Plantation Agriculture Sdn Bhd. Others include
Risda Semaian, Jabatan Pertanian
Sarawak, Lagenda Aktif Sdn Bhd and
Solid Oil Palm Plantations Sdn Bhd.
Honey (left) and Ooi. Honey’s appointment follows an earlier senior appointment
which saw Ooi join the team as general manager, strategy and platforms, in the fourth
quarter of last year.
New leadership team of
Maxus Malaysia
BY Y IMIE YO N G
KUALA LUMPUR: Global media
agency Maxus Global has appointed Glynn Honey as the managing director of Maxus Malaysia, replacing
Lorraine Capel who left the agency
in the third quarter of last year.
In a statement dated April 8,
Maxus Global said the appointment
follows an earlier senior appointment which saw Eileen Ooi join the
team as general manager, strategy
and platforms in the fourth quarter
of last year.
The statement said Honey is a “digital native” who joins Maxus Malaysia
after leading digital marketing businesses in the United Kingdom and
Australia. It said he had spent his entire
23-year marketing career in digital.
“His career highlights include
working on one of the first-ever
websites to incorporate graphic
images in the UK, launching global
online banking brand Rabo Bank
in Australia, helping Subaru to sell
the first-ever car online in Australia, and working with Google on
the globally-awarded ‘Build with
Chrome’,” the statement added.
It also said Honey joined Maxus
after successfully leading Mark, M&C
Saatchi in Australia.
Meanwhile, Ooi is the former
head of strategy of Carat Malaysia,
with previous experience at Mindshare and Starcom.
Maxus Global is part of GroupM,
the world’s largest media investment
management group that serves as
the parent company of all WPP media agencies.
Maxus, the newest of GroupM
agencies, was set up in 2008 to take
advantage of opportunities created
in the digital age and to help its clients to “lean into change”.
8 HOME BUSINESS
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
Hovid seeks to market first
Malaysian drug globally
If pharmaceutical product passes the US Food and Drug Administration’s trials
BY JON AT HA N GAN
KUALA LUMPUR: Ipoh-based Hovid
Bhd may soon be the first Malaysian
company with a pharmaceutical
product that can be marketed globally, if one of its products — touted
as one that can reduce the risk of a
mini stroke — passes the US Food
and Drug Administration’s trials
this year, according to the company’s managing director and chief
executive officer David Ho Sue San.
Ho said about one in three people
who suffer from a transient ischemic attack (TIA), also known as mini-stroke, will eventually have a major
episode — with half of them occurring within a year after the first TIA.
“The studies on our drug should
finish this year and if that proves to
be positive, our company will initiate an IND (investigational new
drug) filing. That would make it the
first Malaysian pharma product in
the world,” said Ho, but did not reveal a specific time frame for that.
The product, named Tocovid
Suprabio, contains a compound
extracted from palm oil named tocotrienol, a little known but potent
part of the vitamin E family which
Ho claims can protect brain cells
and prevent risks of stroke.
Tocovid SupraBio has been sold
locally as a health supplement for
15 years, for which Hovid is increasingly known for, besides its Ho Yan
Hor Herbal Tea.
The company is also studying
the effects of the drug on diabetic patients to see whether it can
slow down the risk of diabetic
neuropathy, said Ho.
Diabetic neuropathy is nerve
damage which occurs in individuals as a result of diabetes, which
damages nerve fibres throughout
the body.
While that is ongoing, business-wise, Ho said Hovid (fundamental 2.1; valuation 1.2) will be
focusing on three key initiatives
this year, namely improve its manufacturing facilities in Ipoh, set up
a research and development (R&D)
facility in Penang, and establish
a centralised logistic warehouse
in Perak.
Chief financial officer Andrew
Goh said the three initiatives —
to cost some RM70 million — will
be mostly financed by borrowings
(80%), while the remainder (20%)
will be borne by internally generated funds.
Ho said the improvement of its
manufacturing facilities in Ipoh will
be split into two phases where the
company will focus on improving
its physical packaging in the first
phase and its capsule facility in
the second.
He said the improvement will
double Hovid’s existing production
capacity and aid in exports where
higher manufacturing standards are
required. Ho estimates the improvements to be concluded by this year.
He estimates a contribution of
20%-30% to its top and bottom line
from its improved manufacturing
facilities for the company’s next
financial year.
For the financial year ended
June 30, 2014 (FY14), Hovid reported a net profit of RM18 million, down 11% from RM20.33 it
Ho said Hovid will be focusing on
three key initiatives this year. The Edge
file photo
saw in the previous year — due to
higher operational expenses and
unscheduled repairs and maintenance and lower sales mix margin — even though its revenue
rose 6% to RM183.54 million from
RM172.51 million.
On the company’s R&D facility,
Ho said the new facility will help
the company conduct more clinical
trials and bio-equivalent studies on
its existing products.
Ho explains that in laymen terms
bio-equivalence equates to the rate
of absorption when compared to a
certified drug.
“The new facility will help
us conduct clinical trials as it is
equipped with hospital beds and
staff. This will give us faster development time for our products.”
On the company’s centralised
logistic warehouse, Ho said the fully automated facility will help the
company reduce wastage of inventory and streamline its distribution.
Being an exporter of pharmaceutical products to over 50 countries,
the company is also a beneficiary
of the weakening ringgit.
About 60% of its business come
from exports while the remainder is
made up by local customers.
CIMB’s pharmaceutical analyst Saw Xiao Jun said in his note
to clients dated March 26 that he
expects Hovid’s new capacity for
its Ipoh facility to be operational
by the middle of this year.
“The first phase of its new tablet and capsule plant is on track
to commence operations by mid2015, and may take 4-5 months to
ramp up production. The second
phase of the same plant is expected to start by early-2016,” said Saw
in his note.
Hovid shares closed at 49.5 sen
last Friday, up 2.5 sen or 5.32%, with
a market capitalisation of RM362.86
million.
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.
Xidelang
targets doubledigit revenue
growth in FY15
BY C H E S T E R TAY
PUTRAJAYA: Sports and casual shoe
manufacturer Xidelang Holdings
Ltd is eyeing double-digit growth
in revenue for its financial year
ending Dec 31, 2015 (FY15).
“We have established a few collaborations with certain international brands, which will see them
placing more orders with us,” the
China-based group’s managing director cum chief executive officer
Mark Ding Peng Peng told reporters after an extraordinary general
meeting (EGM) last Friday.
These brands include Spain’s
Zara and America’s Brooks as well
as Sketchers.
When pressed for more details,
Ding declined to reveal more, citing
non-disclosure agreements.
According to Ding, Xidelang
(fundamental: 1.3; valuation: 1.8)
will be one of the manufacturers for
these brands. Xidelang has seen its
earnings fall for four consecutive
financial quarters last year.
The group registered a net profit
of RM28.21 million for FY14, less
than half the RM58.93 million it
made in FY13, while revenue contracted 18% to RM301.54 million
from RM367.62 million previously.
Meanwhile, Ding noted that
the group’s traditional sales model
is incurring more costs, thus the
management is venturing into electronic commerce (e-commerce)
“Traditionally, we were focused
on our retail outlets. By the second
half of 2015, we hope to sell our
products online, to adapt to the
new market condition,” he said.
However, Ding said the idea of going online is still a nascent one.
Meanwhile, China remains its
main target market. “We will still be
distributing our products in China
even after we embark on e-commerce,” he stressed.
LCTH plans to spend RM65m capital expenditure
BY JEFFREY TA N
KUALA LUMPUR: Precision plastic injection mould manufacturer
LCTH Corp Bhd has plans to spend
up to RM65 million in capital expenditure this year as it aims to
secure more manufacturing orders.
The Johor-based firm, whose
customers include Hewlett Packard (HP), Bose Corp, International
Business Machines (IBM) and Dyson Ltd, is looking to obtain more
orders from its existing customers
as well as new ones.
“We are trying to get more projects from them (existing customers). We are also looking for new
customers,” LCTH’s managing director Hew Lien Lee told The Edge
Financial Daily.
LCTH (fundamental: 2.5; valuation: 1.2) currently operates two
manufacturing plants with one
new plant in Johor and the other
in Penang.
Incorporated in 2003, LCTH has
two wholly-owned subsidiaries —
Penang-based Fu Hao Manufacturing (M) Sdn Bhd and Johor-based
Classic Advantage Sdn Bhd. The
two subsidiaries are engaged in the
manufacturing and sub-assembly
of precision plastic parts and components as well as fabrication of
precision moulds and dies.
The company also has a 40% stake
in Berry Plastic Malaysia Sdn Bhd,
which is principally involved in the
manufacturing and assembly of precision plastic moulded products for
electrical, electronics, healthcare,
food and petroleum industries.
In a phone interview, Hew said
the company is in talks with the
Penang state government to buy
land for manufacturing expansion,
though discussions are still at a
preliminary stage.
According to Hew, the move
to buy the land is necessary as
the Fu Hao plant is already op-
erating at peak capacity.
Assuming the state government
approves the land buy, the total investment cost could amount to RM30
million to RM40 million, inclusive of
building the plant, said Hew.
In Johor, Hew said LCTH still
has surrounding land to build another plant.
“We still have land in excess of
three acres (1.214ha) to utilise,” he
said, noting that this gives it the
advantage to build immediately if
demand increases. A new plant can
cost it RM15 million-RM20 million.
Hew is optimistic the firm may
source more orders this year from
multinational companies (MNCs)
as some are relocating here from
China due to escalating costs there.
“We still see some growth in
Penang because of more MNCs setting up plants there. Just last year,
Bose held its opening ceremony [at
its plant] in Batu Kawan. HP also intends to move some of its businesses
to Johor from China. We will try to
capitalise on that move,” he added.
Hew said LCTH intends to
buy new injection moulding and
tooling machineries as part of the
company’s renewal process, which
could amount to RM3 million to
RM5 million.
“Whenever we make money,
we will try to renew both injection moulding and tool-making
machines just to stay ahead of the
competition,” he said.
With the significant capex spend
it is looking at, it is fortunate that
LCTH is flush with cash. As at Dec
31, 2014, the company net cash
stood at RM73.8 million.
“The reason why we have survived all this while is because we
have a healthy cash flow,” said Hew.
For the quarter ended Dec 31,
2014 (4QFY14), LCTH’s net profit went up more than 10 times to
RM5.95 million from RM438,000
a year ago, mainly due to its fo-
cus on higher margin projects
with lower costs as a result of the
right-sizing exercises.
For the full FY14, however, its
net profit slipped 18% to RM12.9
million from RM15.8 million in the
previous year — due mainly to the
one off gain on disposal of property,
plant and equipment in year FY13.
Excluding this one-off gain in
the year 2013, the group achieved
better performance in terms of profitability in FY14 compared with
FY13, the company noted in its
latest results filing.
LCTH closed down half sen to
42 sen last Friday — which is still
up a whopping 86.7% compared
with 22.5 sen on Dec 15 last year.
The latest price gives it a market
capitalisation of RM151.2 million.
On the share price hike, Hew
said: “The investing public is reacting to our improved financial
results. I believe shareholders are
happy to see the share price gain.”
ST O C KS W I T H M O M E N T U M 9
M O N DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY
This column is an analysis done by Asia Analytica Sdn Bhd on the fundamentals of stocks with momentum that were picked up using proprietary algorithm by
Anticipatory Analytics Sdn Bhd and that first appeared at www.theedgemarkets.com. Please exercise your own judgment or seek professional advice for your specific
investment needs. We are not responsible for your investment decisions. Our shareholders, directors and employees may have positions in any of the stocks mentioned.
FRONTKEN CORPORATION BHD (-ve)
FRONTKEN (Fundamental: 1.8/3, Valuation: 1.1/3) was the most actively traded
stock last Friday with more than 177 million
shares changing hands. It closed up 2.5 sen
or 13.2% to 3-year high of 21.5 sen.
Frontken provides surface and mechanical engineering services to a wide range of
heavy industries such as oil & gas, power
generation and semiconductor.
For 2014, revenue saw a significant 62.6%
increase to RM309.8 million. Domestic market accounted for about half of total revenue,
FRONTKEN CORPORATION BHD
with the balance coming from, mainly, Taiwan and Singapore.
Net profit surged to RM18.8 million, a
reversal from net loss of RM2.3 million in
2013, due to stronger demand from the semiconductor industry and progressive income
recognition from a hydrocarbon project in
Tanjung Bin, Johor.
Frontken has a net cash position of
RM28.8 million. The stock is trading at a
trailing 12-month P/E of 10.6 times and 0.96
times book value of 24 sen.
Valuation score*
1.10
1.80
Fundamental score**
10.61
TTM P/E (x)
TTM PEG (x)
0.96
P/NAV (x)
TTM Dividend yield (%)
199.21
Market capitalisation (mil)
Shares outstanding (ex-treasury) mil 1,048.47
1.24
Beta
0.10-0.20
12-month price range
*Valuation score - Composite measure of historical return & valuation
**Fundamental score - 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
HO WAH GENTING BHD (-ve)
HO Wah Genting Bhd (HWGB) (Fundamental: 0.35/3, Valuation: 0.3/3) is mainly
involved in manufacturing and trading of
wires and cables, moulded power supply
cord sets and cable assemblies for electrical
and electronic devices.
Its share price has risen steadily this year,
after falling to a 3-year low of 11.5 sen in
mid-December 2014. The stock gained 17.9%
last week on rising volume to close at 16.5 sen.
HWGB has been in the red since 2011.
Revenue for 2014 declined 16.5% y-y to
HO WAH GENTING BHD
RM191.4 million on lower demand for wires
and cables. Pre-tax losses was slightly lower
at RM22.8 million, from RM25.8 million in
2013, due to lower impairments on securities investments.
The company is hopeful that a stronger
housing market in the US, its primary market, will result in better performance going
forward, although competition is expected
to remain intense.
Gearing is high at 57.8% as end-2014 while
interest cover is negative.
Valuation score*
0.30
0.35
Fundamental score**
TTM P/E (x)
TTM PEG (x)
1.75
P/NAV (x)
TTM Dividend yield (%)
96.18
Market capitalisation (mil)
601.15
Shares outstanding (ex-treasury) mil
1.47
Beta
0.12-0.21
12-month price range
*Valuation score - Composite measure of historical return & valuation
**Fundamental score - 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
VISDYNAMICS HOLDINGS BHD (-ve)
FRONTKEN CORPORATION BHD
(ALL FIGURES IN MYR MIL)
Financials
Turnover
EBITDA
Interest expense
Pre-tax profit
Net profit - owners of company
Fixed assets - PPE
Total assets
Shareholders' fund
Gross borrowings
Net debt/(cash)
FRONTKEN CORPORATION BHD
RATIOS
DPS (MYR)
Net asset per share (MYR)
ROE (%)
Turnover growth (%)
Net profit growth (%)
Net margin (%)
ROA (%)
Current ratio (x)
Gearing (%)
Interest cover (x)
HO WAH GENTING BHD
(ALL FIGURES IN MYR MIL)
Financials
Turnover
EBITDA
Interest expense
Pre-tax profit
Net profit - owners of company
Fixed assets - PPE
Total assets
Shareholders' fund
Gross borrowings
Net debt/(cash)
HO WAH GENTING BHD
RATIOS
DPS (MYR)
Net asset per share (MYR)
ROE (%)
Turnover growth (%)
Net profit growth (%)
Net margin (%)
ROA (%)
Current ratio (x)
Gearing (%)
Interest cover (x)
VISDYNAMICS HOLDINGS BHD
(ALL FIGURES IN MYR MIL)
VISDYNAMICS (VIS) (Fundamental: 2.5/3,
Valuation: 0.3/3) traded as high as 31 sen
last Friday, before closing down 1.7% at
29.5 sen.
The company proposed a private placement last month. Proceeds from the placement, involving up to 10 million new shares
of RM0.10 each or 9.9% of existing share
capital, are intended for working capital
and future expansion plans. The issue price
is yet to be determined.
Based in Malacca, VIS provides equipment
VISDYNAMICS HOLDINGS BHD
solutions to the semiconductor assembly and
test industry. The company derives most of
its sales from North Asia.
Balance sheet is solid with net cash of
RM2.1 million or 2.1 sen per share. But VIS
was loss-making in FYOct2012-FY2013 on
falling sales, although it recovered some in
FY2014 to book a net profit of RM1.24 million.
The stock is trading at a relatively high
trailing 12-month P/E of 22.5 times and 1.66
times book value. No dividend was paid
since April 2011.
Valuation score*
0.30
2.50
Fundamental score**
22.53
TTM P/E (x)
TTM PEG (x)
P/NAV (x)
1.66
TTM Dividend yield (%)
30.21
Market capitalisation (mil)
100.70
Shares outstanding (ex-treasury) mil
0.93
Beta
0.19-0.77
12-month price range
*Valuation score - Composite measure of historical return & valuation
**Fundamental score - 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
Financials
Turnover
EBITDA
Interest expense
Pre-tax profit
Net profit - owners of company
Fixed assets - PPE
Total assets
Shareholders' fund
Gross borrowings
Net debt/(cash)
VISDYNAMICS HOLDINGS BHD
RATIOS
DPS (MYR)
Net asset per share (MYR)
ROE (%)
Turnover growth (%)
Net profit growth (%)
Net margin (%)
ROA (%)
Current ratio (x)
Gearing (%)
Interest cover (x)
FY11
FY12
FY13
FY2014Q4
31/12/2011
31/12/2012
31/12/2013
31/12/2014
198.12
24.62
2.80
3.00
2.48
180.97
262.78
179.27
68.63
42.27
181.03
26.50
2.87
3.24
3.82
153.53
245.10
184.89
61.23
19.77
190.61
27.24
1.45
5.91
(2.32)
144.05
243.71
186.30
32.45
(4.66)
105.05
14.74
0.35
9.91
7.16
135.55
267.68
206.81
35.12
(28.82)
FY11
FY12
31/12/2011
31/12/2012
31/12/2013
0.18
1.40
35.05
(79.28)
1.25
0.94
1.69
23.58
8.78
0.18
2.10
(8.62)
53.78
2.11
1.50
1.88
10.69
9.23
0.18
(1.25)
5.29
(1.22)
(0.95)
2.23
18.77
FY13 ROLLING 12-MTH
0.20
9.84
62.55
6.06
7.56
2.08
36.21
FY11
FY12
FY13
FY2014Q4
31/12/2011
31/12/2012
31/12/2013
31/12/2014
246.66
(0.95)
5.70
(10.72)
(6.52)
62.64
99.43
93.83
73.49
53.40
243.57
(22.34)
5.04
(34.14)
(32.52)
58.08
82.95
86.91
69.74
46.81
229.20
(12.77)
4.69
(25.82)
(24.43)
58.70
72.93
76.56
73.26
43.45
39.17
(8.57)
1.12
(11.42)
(10.86)
58.72
72.39
55.00
43.66
31.81
FY11
FY12
31/12/2011
31/12/2012
31/12/2013
0.19
(6.85)
2.55
(2.64)
(6.13)
0.88
56.91
(0.17)
0.16
(35.98)
(1.25)
(13.35)
(35.66)
0.89
53.86
(4.43)
0.13
(29.89)
(5.90)
(10.66)
(31.35)
0.86
56.74
(2.72)
FY13 ROLLING 12-MTH
0.06
(32.10)
(16.43)
(11.10)
(26.58)
1.04
57.82
(2.82)
FY12
FY13
FY14
FY2015Q1
31/10/2012
31/10/2013
31/10/2014
31/1/2015
9.75
0.09
0.06
(0.44)
(0.44)
5.48
18.80
18.66
1.76
(4.02)
3.62
(2.00)
0.03
(2.40)
(2.40)
5.11
16.27
16.27
0.37
(1.84)
16.12
1.73
0.05
1.24
1.24
4.74
17.51
17.51
2.52
(1.35)
3.27
0.75
0.02
0.68
0.68
4.84
18.19
18.19
1.53
(2.14)
FY12
FY13
31/10/2012
31/10/2013
31/10/2014
0.19
(2.32)
(37.73)
(4.50)
(2.28)
4.00
1.43
0.16
(13.71)
(62.82)
(66.11)
(13.66)
5.09
(60.28)
0.17
7.35
344.78
7.70
7.35
2.54
34.35
FY14 ROLLING 12-MTH
0.18
7.89
115.70
8.58
7.88
3.32
24.35
1 0 I N V E ST I N G I D E A S
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
Note: This report is brought to you by Asia Analytica Sdn Bhd, a licensed investment adviser. Please exercise your own
judgment or seek professional advice for your specific investment needs. We are not responsible for your investment
decisions. Our shareholders, directors and employees may have positions in any of the stocks mentioned.
I N S I D E R A S I A’S S TO C K O F T H E D AY
KOSSAN RUBBER INDUSTRIES BHD
(ALL FIGURES IN MYR MIL)
KOSSAN RUBBER INDUSTRIES BHD
SHARES for the four biggest glove makers
have far outperformed the broader market
in the year-to-date. This we believe is due, in
no small part, to the precipitous drop in the
ringgit against the US dollar — glove makers
are, primarily, exporters.
The current environment of low commodity
prices would also favour the industry. Low
oil and rubber prices translate into cheaper
selling prices — which will, in turn, be the
perfect time to encourage greater adoption/
consumption. This is particularly true in
developing countries, including China, where
per capita consumption is still very low — and
where usage is more price-sensitive.
Since Kossan (Fundamental: 2.1/3, Valuation: 0.5/3) was first featured by InsiderAsia,
on October 15, 2014, its shares have gained
31.6% to close at RM5.71 yesterday.
The stock is not cheap, trading at trailing P/E
of 25 times against the broader market average
KOSSAN RUBBER INDUSTRIES BHD
of 16 times. By comparison, Top Glove and
Supermax are trading at 14-17 times although
Hartalega is priced at nearly 33 times.
Nevertheless, we expect earnings growth
to far outpace that of the broader market.
Kossan boosted annual production capacity
by 38% to 22 billion pieces at end-2014 and
plans to raise this further this year, on the
back of strong orders for its glove products.
Furthermore, the company started shifting
towards nitrile gloves, which offer better
margins compared to natural rubber gloves, in
2013. It aims to hit nitrile to natural rubber mix
of 70:30 this year, compared to 57:43 last year.
Its return on equity (ROE) — with modest
gearing — of 19.8% is one of the highest in the
industry. Utilization is consistently high, above
85%. By comparison, ROE for Top Glove and
Supermax stood at 14% and 11%, respectively,
while Hartalega, which manufactures mainly
nitrile gloves, has a high ROE of over 21%.
Valuation score*
0.50
2.10
Fundamental score**
25.31
TTM P/E (x)
11.42
TTM PEG (x)
4.52
P/NAV (x)
1.23
TTM Dividend yield (%)
3,638.57
Market capitalisation (mil)
Shares outstanding (ex-treasury) mil 639.47
0.45
Beta
3.57-5.85
12-month price range
*Valuation score - Composite measure of historical return & valuation
**Fundamental score - 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
Income Statement
Turnover
EBITDA
Depreciation
EBIT
Associates
Interest income
Interest expense
Extraordinary gain/(loss)
Pre-tax profit
Net profit - 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
KOSSAN RUBBER INDUSTRIES BHD
RATIOS
DPS (MYR)
Net asset per share (MYR)
ROE (%)
Turnover growth (%)
Net profit growth (%)
Net margin (%)
ROA (%)
Current ratio (x)
Gearing (%)
Interest cover (x)
FY11
FY12
FY13
FY2014Q4
31/12/2011
31/12/2012
31/12/2013
31/12/2014
1,089.97
159.08
40.91
118.17
1.59
7.47
112.29
89.19
1,234.00
188.89
45.10
143.79
1.07
6.41
138.45
102.16
1,307.29
235.31
50.98
184.33
2.69
6.88
180.13
136.42
360.96
65.49
14.70
50.79
0.47
2.04
49.21
37.93
473.24
4.93
51.62
374.40
124.94
245.92
606.80
531.16
18.20
514.37
4.93
99.85
470.51
151.98
284.45
705.49
604.60
35.68
600.54
4.93
100.60
500.44
112.17
278.73
827.29
704.94
37.86
724.53
4.93
71.70
550.89
122.01
329.49
950.98
804.82
40.05
FY11
FY12
31/12/2011
31/12/2012
31/12/2013
FY13 ROLLING 12-MTH
0.07
1.66
18.32
4.12
(21.33)
8.18
16.05
1.52
17.23
21.31
0.12
1.89
17.99
13.21
14.54
8.28
15.57
1.65
14.52
29.48
0.07
1.10
20.84
5.94
33.53
10.44
17.80
1.80
7.01
34.18
0.07
1.26
19.80
(0.80)
2.22
11.06
16.96
1.67
11.23
30.48
B R O K E R S’ C A L L 11
M ON DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY
MAHB’s Turkey
business better
than expected
Mobile HyppTV for DiGi subscribers
DiGi.Com Bhd
FYE DEC (RM MIL)
Revenue
Operating profit
Pre-tax profit
Net profit
EPS (sen)
PER (x)
DPS (sen)
Dividend yield
2013A
6,733.4
2,141.5
2,140.2
1,705.9
21.9
28.8
21.3
3.4
2014A
2015F
2016F
2017F CAGR (%)
7,018.5 7,260.2 7,510.5 7,722.9
2,658.6 2,787.0 2,886.0 2,952.6
2,645.2 2,766.4 2,867.6 2,936.7
2,031.1 2,088.6 2,179.4 2,231.9
26.1
26.9
28.0
28.7
24.1
23.4
22.5
22.0
26.0
26.9
28.0
28.7
4.1
4.3
4.4
4.6
2.8
6.6
6.5
5.5
5.5
Source: Company, PublicInvest Research estimates
Malaysia Airports Holdings Bhd
(April 10, RM6.99)
Maintain hold with a higher target
price (TP) of RM7.45 from RM7.22:
This is the first of a two-part series
on Malaysia Airports Holdings Bhd
(MAHB)’s businesses in Malaysia
and Turkey.
Unfortunately, our “hold” call is
intact as the outlook for Malaysia is
weak, though Turkey is doing better
than expected.
We recommend to switch to Westports Holdings Bhd.
Even so, we raise our discounted cash flow (DCF)-based TP to
RM7.45, as we raise the value of both
the Malaysia and Turkey businesses,
due to lower discount rates.
We raise our financial year 2015
forecast (FY15F) as we incorporate
an additional 40% contribution from
Turkey, but cut FY16 core earnings
per share (EPS) as we adopt MAHB’s
depreciation practice until 2034, instead of 2069.
Our DCF still discounts cashflow
to 2069, assuming the KLIA concession is extended.
In our first instalment, we take
a closer look at Istanbul Sabiha
Gökçen (ISG), which is doing better than expected.
Although ISG suffered a core net
loss of €33 million (RM128.24 million) in FY14, it was ahead of our
€41 million loss forecast.
FY15 looks brighter for ISG with
passenger traffic growth forecast
at 20%, against our old 7% forecast.
We believe our new passenger
traffic growth forecast is achievable,
after reviewing the latest guidance
from the two airlines that use ISG,
i.e. Pegasus Airlines and Turkish
Malaysia Airports Holdings Bhd
FYE DEC (RM MIL)
Revenue
Operating Ebitda
Net profit
Core EPS (RM)
Core EPS growth (%)
FD Core PER (x)
DPS (RM)
Dividend yield (%)
EV/Ebitda (x)
P/FCFE (x)
Net gearing (%)
P/BV (x)
ROE (%)
% change in core EPS
estimates
CIMB/consensus EPS (x)
2013A
2014A
2015F
2016F
2017F
4,099
811
389.2
0.25
(13.9)
27.87
0.11
1.59
15.50
na
73.7
1.94
7.17
3,344
846
748.6
0.13
(46.4)
49.72
0.05
0.78
17.08
na
57.7
1.37
3.20
3,902
1,434
173.6
0.11
(18.3)
60.31
0.07
1.03
10.47
235.0
39.0
1.31
2.22
4,262
1,578
167.4
0.14
23.9
51.82
0.07
1.00
9.09
8.2
31.3
1.30
2.52
4,480
1,756
249.0
0.22
66.2
34.48
0.08
1.13
6.58
7.8
22.2
1.06
3.42
9.1
0.72
(32.0)
0.46
0.77
Source: CIMB, Company reports
Airlines, and examining the airlines
forward seat capacity plans.
Hence, we expect ISG to turn a
core net profit of €12.6 million in
FY15, up from the previous loss forecast of €30 million.
The second runway is critical for
the Istanbul Sabiha Gokcen International airport (SAW) to take advantage of the congestion at the Istanbul
Ataturk airport, because SAW’s single
runway is saturated during the peak
morning and evening slots.
Sadly, a delay in the completion of
the second runway from early-2016
to mid-2017 will shorten the golden
period for SAW that lies between the
completion of its second runway and
the expected commissioning of Istanbul’s third airport in early 2019.
This is a golden period of growth
for SAW because airlines have nowhere else to go until the third airport is ready, but this duration of
time is now expected to be 1½ years.
We valued ISG in mid-2014 at
€620 million. Our revised valuation
is €667 million, mainly due to accretion from using a lower cost of equity,
but largely offset by lower cash flow
from the delay in the completion of
the second runway, and a reduction
in our assumption of the growth of
duty-free revenue per pax.
In conclusion, MAHB’s purchase
of 40% of ISG from GMR Infrastructure Ltd in April 2014 was 23% less
than our base-case valuation, but
its recent 40% purchase from Limak Holdings AS was 4.6% overpriced. — CIMB Investment Bank
Bhd, April 9
Sunway to acquire premium
wholesale hardware firms
Sunway Bhd
(April 10, RM3.76)
Maintain buy with a target price
(TP) of RM3.76: Sunway is proposing to acquire Winstar Trading Sdn
Bhd (Winstar) and PND Hardware &
Trading Pte Ltd (PND) for RM130.9
million and S$2.6 million (RM6.96
million), respectively.
The acquisitions will be completed in three tranches whereby Sunway will first acquire a 60% stake,
expected to be completed by the
second quarter of 2015 (2Q15) in the
companies, followed by an additional
20% stake each by 2Q17 and 2Q18.
There is a profit guarantee for financial years 2015 (FY15) to FY17
of RM15 million per annum and
S$250,000 per annum for Winstar
and PND, respectively, implying good
prospects for the hardware trading
business.
This translates into 8.7 times
price-earnings ratio (PER) for Winstar
and 10.4 times for PND. Given that
both companies are market leaders
with over 30 years of experience in
the wholesale hardware market with
extensive distribution networks and
customer bases, the acquisitions will
complement Sunway’s trading and
manufacturing division.
We maintain our earnings forecast
for now as Sunway’s 60% stake in
Winstar and PND will only increase
our FY16 earnings by 1.6%.
The listing of Sunway Construction Group Bhd by June this year
remains the next re-rating catalyst
for the group, given the potential
9% yield (special cash dividend and
free Sunway Construction shares).
Nevertheless, our rating is under review as the share price has
rallied 14% since our last update in
February, and is now close to our
TP. — Alliance DBS Research Sdn
Bhd, April 10
DiGi.Com Bhd
(April 10, RM6.25)
Maintain neutral with a target
price (TP) of RM5.90: According
to news reports, DiGi.Com Bhd
(DiGi) will collaborate with Telekom Malaysia Bhd (TM) to offer
TM’s Internet Protocol television
(IPTV) services (HyppTV) for
DiGi subscribers.
Under the collaboration,
TM will provide entertainment,
sports and video on demand on
its HyppTV to DiGi’s subscribers
through the mobile application,
HyppTV Everywhere.
The mobile service is due to
be launched today. While we are
positive on DiGi tapping into additional digital content to stimulate mobile data usage, we believe
the new service will have negligible financial impact (less than
1% on top line) on DiGi.
HyppTV Everywhere is a mobile (on-the-go) version of TM’s
HyppTV’s service which will enable users to view the IPTV channels via smartphones, tablets and
notebooks.
Previously, HyppTV was only
offered to UniFi and Streamyx,
but TM has offered the service
since January to any user who
downloads the HyppTV Everywhere app (either android or
iOS).
The HyppTV Everywhere has
two major components: broadcast live TV (free channels such as
Channel News Asia and Bloomberg TV, and premium channels
such as Warner TV and Cinema
World), and Video on Demand
(channels such as Cinema World
HD On Demand and HyppSports
HD On Demand).
Currently, non-HyppTV subscribers can choose three channels from RM15.90 a month or
purchase premium channels on
an a la carte basis.
We b e l i e v e d e d i c a t e d
DiGi-HyppTV Everywhere packages will be offered to DiGi subscribers to differentiate from what
is currently being offered.
While we are positive that additional digital content offered by
HyppTV Everywhere will be helpful for DiGi to increase data usage
by its subscribers, we believe the
take-up rate of paid subscription
of HyppTV Everywhere by DiGi
subscribers will be rather limited as there are plenty of free or
competing alternatives available
on the Internet.
The collaboration is a good
start for DiGi to increase its digital
content offering without incurring substantial costs, as well as
to drive data usage by its mobile
data subscribers.
We reiterate our “neutral” call
on DiGi with an unchanged discounted cash flow (DCF)-derived
TP of RM5.90. — Public Investment Bank Bhd, April 10.
Sunway Bhd
FYE DEC (RM MIL)
Revenue
Ebitda
Pre-tax profit
Net profit
Net pft (pre ex)
EPS (sen)
EPS pre ex (sen)
EPS gth (%)
EPS gth pre ex (%)
Diluted EPS (sen)
Net DPS (sen)
BV per share (sen)
PER (x)
PER pre ex (x)
P/Cash flow (x)
EV/Ebitda (x)
Net div yield (%)
P/Book value (x)
Net debt/Equity (x)
ROAE (%)
2014A
2015F
2016F
2017F
4,842
962
969
743
592
43.1
34.3
(50)
22
37.0
10.3
344.9
8.7
11.0
8.4
9.0
2.7
1.1
0.3
13.2
5,361
949
719
569
569
33.0
33.0
(23)
(4)
28.3
9.9
368.0
11.4
11.4
8.6
9.0
2.6
1.0
0.2
9.3
5,943
1,000
753
597
597
34.6
34.6
5
5
29.7
10.4
392.3
10.9
10.9
10.2
8.5
2.8
1.0
0.2
9.1
5,236
969
717
552
552
32.0
32.0
(7)
(7)
27.5
9.6
414.7
11.7
11.7
11.1
8.8
2.6
0.9
0.2
7.9
Source: Company, AllianceDBS, Bloomberg Finance L P
12 B R O K E R S’ C A L L
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
Unimech affected by
margin compression
Unimech Group Bhd
(April 10, RM1.41)
Maintain sell with unchanged target price (TP) of RM1.45: Unimech
Group Bhd’s (Unimech) share price
had declined by 21% since the peak
of RM1.78 in October 2014.
We believe the weakening of the
share price was due to persistent
margin compression as observed in
the quarterly financial results and
uncertainty in the outlook of the oil
and gas as well as plantation sectors.
We see no immediate rerating
catalyst at this juncture and margin compression remains a major
concern.
Therefore, we reiterate our “sell”
recommendation for Unimech with
an unchanged TP based on calendar year 2016 (CY16) price-earnings
ratio (PER) of 10 times.
On an annual basis, Unimech’s
margin started to narrow noticeably
in financial year 2014 (FY14) despite
an increase in revenue.
We believe the group may lose
control over the pricing power for
some of its products in FY14.
Furthermore, higher finance cost
and depreciation have exacerbated
the situation.
The group’s margin had been
resilient at around 19% to 20% in
the FY09 to FY13 period, which had
Unimech Group Bhd
FYE DEC 31 (RM MIL)
Revenue
Ebitda
Ebitda margin (%)
Pre-tax profit
Net profit
Core net profit
Diluted EPS (sen)
Diluted EPS growth (%)
PER (x)
Net DPS (sen)
Div yield (%)
ROE (%)
FY13
FY14
FY15E
2016F
2017F
227.2
45.2
19.9
32.5
20.6
20.7
17.1
(6.0)
8.3
6.0
4.3
10.6
238.0
42.0
17.7
25.9
15.5
15.3
10.2
(40.0)
13.8
4.5
3.2
7.0
249.1
55.5
22.3
35.0
19.9
19.9
12.8
24.6
11.1
5.5
3.9
8.6
264.7
60.2
22.8
39.0
23.0
23.0
14.5
13.5
9.7
6.8
4.8
9.4
285.7
62.6
21.9
40.5
23.9
23.9
15.0
3.5
9.4
7.1
5.0
9.2
Source: TA Securities
previously served as an investment
merit.
We note that margin has deteriorated since then, especially over the
last two quarters of FY14.
The group recently disposed of a
40% stake in a subsidiary, All Torque
Control Pte Ltd (ATC), for S$35,000
(RM93,742).
We understand that Unimech will
register a loss on disposal as the selling price is less than the book value.
Note that ATC has an unaudited
shareholders’ fund of S$97,700 as at
Dec 31, 2014.
Management guided that ATC
is actually a dormant entity and
doesn’t generate profit as initially
planned.
The subsidiary is involved in the
marketing and supplying of pneumatic actuators for remote control
valves for use in oil and gas, refinery, petrochemical, food industry,
machine maker, power plant, water
treatment plant, oil rig or platform
and general trading.
Unimech’s official policy is to
pay up to 30% of its net profit as
dividends. In FY14, the payout ratio
worked out to 34%, compared with
35% in FY13.
Nonetheless, its dividend per
share (DPS) was lower at 4.5 sen in
FY14 versus six sen in FY13.
Management guided that the
capital expenditure (capex) requirement for FY15 will be lower
by about RM10 million compared
with RM26.9 million in FY14.
This suggests upside to dividends
going forward. Our analysis indicates that after taking into account
the capex requirement, working
capital, finance cost and depreciation, Unimech will easily meet the
30% payout target without incurring
any additional borrowing.
We expect the group to pay DPS
of 5.5 sen and 6.8 sen in FY15 and
FY16, respectively. That translates
into dividend yields of 3.9% and
4.8% in FY15 and FY16.
We value the stock based on 10
times CY16 diluted earnings per
share of 14.5 sen.
Unimech appears to be fairly
valued at the current price.
The softening outlook for plantation and oil and gas sectors will
prompt companies to trim capex
budget and reduce the demand for
valve products.
Downside to the stock price is
buffered by the attractive dividend
yield. — TA Securities Holdings Bhd,
April 10
KNM unveils RM204m contracts for FY15
KNM Group Bhd
(April 10, 63.5 sen)
Maintain buy with a target price
(TP) of 88 sen: KNM Group Bhd
(KNM) announced contracts with
a total value of RM204 million for
year to date in financial year 2015
(FY15).
The contract details are: Refinery and Petrochemical Integrated
Development (Rapid) subcontractor contract from Toyo Engineering (Package 5) for RM120 million;
Rapid subcontractor contract from
Technicas (Package 3) for RM54.6
million; and Turkmengas petrochemical complex project for RM29
million.
Contracts’ period are for between 12 and 18 months.
Total contract win from Rapidcurrently is around RM1.2 billion.
We maintain our earnings forecasts
as we have already factored in a
total of RM2.2 billion in Rapid-related contracts or RM540 million
per annum based on a contract
duration of four years.
We believe our earnings forecast in FY15 is fairly achievable as
we only factored in RM270 million
revenue from Rapid and we only
expect Rapid-related contracts
to contribute in the second half
of 2015.
We are positive on the contract
wins. KNM being among the largest
process equipment manufacturer
KNM Group Bhd
FYE DEC (RM MIL)
Revenue
Ebitda
Patami
EPS (sen)
PER (x)
BV/share
P/BV (x)
ROA (%)
ROE (%)
2013A
2014A
2015E
2016E
1,984
199
23
2
31.1
1.40
0.45
0.6
1.1
1,865
277
46
3
22.6
1.35
0.47
1.1
2.1
2,419
288
122
7
8.5
1.42
0.44
2.8
5.2
2,514
297
132
8
7.8
1.50
0.42
2.9
5.4
Source: HLIB
should be one of the main beneficiaries of the Rapid project.
With the Rapid project proceeding, we expect to see a continuous
contract newsflow. We understand
that KNM has a good chance to
secure more subcontractor jobs
from some refinery packages in
the near term.
In addition, KNM has also sub-
mitted bids for subcontractor jobs
for the other packages of refinery
plant and engineering, procurement, construction and commissioning contract for tank farms and
other associated facilities.
The recent joint venture (JV)
with Korea-based Hansol Corporation (40:60) will be bidding for
some biomass projects in Malaysia.
The contract size is ranging from
RM100 million to RM300 million.
We understand there are numerous tenders for biomass projects.
Together with United Kingdom’s
EnergyPark Peterborough biomass
project, we expect to see significant
contribution of income from the
recurring renewable energy division in the future.
Catalysts are the announcement
of more Rapid contract wins; financial closing of EnergyPark Peterborough; additional contribution
from renewable energy business
in Thailand and/or from JV with
Hansol Corp.
Risks are fluctuation in oil price;
project execution ability and delay
in contracts award.
We maintain our “buy” call with
unchanged TP based on unchanged
11 times FY16 price-earnings ratio.
Our TP has not factored in value
from EnergyPark Peterborough and
Thailand’s renewable energy business yet. — Hong Leong Investment
Bank Bhd, April 10
Setting up
of commission
to boost
growth of
sector
Aviation Sector
Maintain positive: Parliament
passed a new bill, the Malaysian
Aviation Commission Bill 2015,
which paves the way for the setting up of the Malaysian Aviation
Commission (MAC).
While the Ministry of Transportation (Mot) and the Department of Civil Aviation (DCA) are
already overseeing the aviation
industry we believe the addition of the MAC would provide
a more structured path to boost
the growth of the sector.
The MAC focuses on the economic aspects of the aviation
industry, which is different from
the DCA’s role which covers air
traffic management, airworthiness, flight operations, aviation
security, etc. The MoT focuses on ensuring all rules in air
transport or aviation are in accordance with the International
Civil Aviation Organisation and
implementing infrastructural
projects to meet demands of air
transport.The MAC will take over
from the MoT (via the DCA) for
the issuance and renewal of air
service licences (scheduled services) and permits (non-scheduled services).
In addition, the MAC will also
be responsible for administering,
allocating and managing air traffic rights and slot allocations. We
believe the MAC would better
position Malaysia to take advantage of the implementation
of the Association of Southeast
Asian Nations Open Sky policy.
Furthermore, on the back of
a tragic year for the Malaysian
aviation industry, we believe
the commission could also improve consumer confidence in
the aviation sector.
The new bill entails several clauses aimed at promoting
healthy competition among airlines such as preventing agreements between enterprises
which restrict or distort competition (collusion); abuse of a
dominant position by an enterprise (anti-monopoly); mergers
that diminish competition (antitrust); and reviewing the aviation service market for actions
which prevent, restrict or distort
competition.
The MAC could regulate air
fares or excessive capacity expansion to prevent instances
of fare dumping, price wars and
overcapacity issues as seen in recent years. This would bode well
for airline players in the form
of higher yields and better load
factors. We are positive that the
protection of consumer rights
is highlighted.
Within our coverage, we have
“buy” calls on AirAsia Bhd (target price or TP: RM3.70) and
AirAsia X Bhd (ex-rights TP: 49
sen) while we are “neutral” on
Malaysia Airports Holdings Bhd
(MAHB) (TP: RM7.53). — MIDF
Amanah Investment Bank Bhd,
April 10
14 H O M E
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
Dr M: Set up independent
panel for 1MDB probe
Former PM unhappy over Najib’s response to the issue
Dr Mahathir: Who is this Jho Low,
who has suddenly become so very
important? Photo by Patrick Goh
KUALA LUMPUR: Unhappy over
the lack of answers given by Datuk
Seri Najib Razak on the 1Malaysia
Development Bhd (1MDB) issue,
Tun Dr Mahathir Mohamad said the
government needs to set up a “totally independent commission” to
investigate the debt-ridden government-owned investment company.
The former prime minister said
the Auditor-General’s office might
not do a thorough investigation or
forensic [audit], and sought to know
when the probe will be concluded.
He said it took the courts five
years to clear him of a defamation
suit, and something like the 1MDB
probe would drag on a long time.
Dr Mahathir also demanded to
know where the 1MDB funds had
gone, and who Low Taek Jho, the
businessman commonly known as
Jho Low, was after more video clips
of [Dr M]’s recent recorded interview
with bloggers were uploaded on a
blog named Din Turtle yesterday.
“Who is this Jho Low, who has
suddenly become so very important?
Dia tak ada jawatan dalam kerajaan
(he has no government position), dia
bukan (he is not a) civil servant ...
suddenly he has such power ... and
people tell me, although I cannot say
it is proven, that he conducts himself
as if he is the government.
“Tak berani (you don’t dare to
do it), I will ring up the PM ... That
was what they said. Whether it is
true or not, I don’t know-lah. That
is the story,” he said.
One clip showed Dr Mahathir
saying that “if Barisan Nasional
(BN) loses the next general election, the country will see a lot of
people paying a big price” in his
comments related to 1MDB.
“It is very difficult now to do anything. At least a few billion dollars
(ringgit) would be lost. I fear that
when the opposition wants us to
lose, and they will have no sympathy, they will dig.
“And when they do, people may
be charged in court and found
guilty. So if BN loses, this country
will see a lot of people paying a
big price.”
Dr Mahathir said the time for
Najib to resign was now when the
coalition still had two years to work
and recover.
“If he doesn’t go now, [and] this
PAC (Public Accounts Committee)
and others investigate for two [or]
three years until the general election and he is still there and we lose,
I think there will be a lot of trouble
for everyone.
“Those who cover up will have
to pay a price,” he said.
Dr Mahathir has been bashing
Najib and his administration in
recent months for the 1MDB scandal, continuing the 1Malaysia People’s Aid (BR1M) and the murder
of Mongolian translator Altantuya
Shaariibuu, and called for the prime
minister’s resignation.
Last Thursday, Najib gave a special interview on TV3 to address the
issues raised by Dr Mahathir, but in
doing so he raised more questions.
In an earlier video clip on Din
Turtle on Saturday, Dr Mahathir
said: “We asked about 1MDB, and
he said the matter has been referred
to the Auditor-General. That is not
an answer.” — The Malaysian Insider
‘Umno today is
about money’
KUALA LUMPUR: As Tun Dr Mahathir Mohamad comes under fire
from the party he led for 22 years,
the former president lambasted
his critics, saying that Umno now
“is about money”.
Under the current leadership,
Umno is filled with rent-seeking
leaders who are loyal only to money, Dr Mahathir said in a video
uploaded on the blog Din Turtle
on Saturday.
The former prime minister’s latest tirade comes as he is criticised by
Umno members for causing a rift in
the party with his constant attacks
against Datuk Seri Najib Razak.
“The Umno now is about money. The leaders of Umno are loyal
because they get contracts.
“The ones who receive posts receive money,” Dr Mahathir said in
response to the claim that his criticism was dividing Umno members.
Although Dr Mahathir claimed
that Najib would bring Umno down,
some in Umno had countered that
it was his constant attacks against
the prime minister that were weakening Umno.
“Umno is already split. The
Umno that I led was quite powerful. If you looked at the assembly
(then), the spirit was there.
“The Umno now is about money,”
Dr Mahathir said in response to a
question that his calls for Najib to
resign were splitting Umno between
pro-Najib and pro-Mahathir camps.
Dr Mahathir has become the
face of a movement within the
party to oust Najib, who remains
a powerful leader and one who is
able to command the support of
almost all of the party’s grassroots
leaders at the division level.
Dr Mahathir has called for Najib to
resign over his fiscal policy missteps
such as the 1Malaysia People’s Aid
scheme (BR1M) and 1Malaysia Development Bhd’s RM42 billion debt.
He also said that if Najib did
not resign, Umno and the Barisan
Nasional coalition would lose the
next general election.
He and Umno veterans such as
former finance minister Tun Daim
Zainuddin claimed that all the support Najib was getting in Umno was
insincere. In the three-minute clip,
Dr Mahathir repeated his reasons
he thought Najib should resign.
“The New Economic Policy
(NEP), the Malays being disappointed. It’s very deep (the reasons). They come and see me, ordinary people,” Dr Mahathir said,
adding that they complained about
Najib’s administration.
“[They say] scholarships are
hard to get. In the past, you could
get them.”
He also defended his right to criticise Najib, saying that when it came
to national and Malay issues, he
had the right to talk about them as
he considered himself Malay, even
though this had been disputed.
“About the country and the Malays, I am here, I am a Malay. Although some people say I am not.
Legally, I am Malay. I’ve struggled
for this. It is the right of people to
reject what I say but it is my right
to criticise.”
Dr Mahathir was later seen in
the video nodding his head to the
question on whether as a Malay
leader, Najib has failed. — The Malaysian Insider
Lee (centre) says the bureau will be organising a trip to Baram, Sarawak in May to support the Baram people in their struggle against
the construction of the 1,200mw dam. Photo by The Malaysian Insider / Afif Abd Halim
PKR lends support to Baram Dam blockade
MIRI: For over a year now, people
from 30 villages near the proposed
Baram Dam project in Sarawak had
taken turns to stand guard at two
barricades in their fight against the
mega project.
Yesterday marked the 536th day
the Baram people have stationed
themselves at the two barricades —
the Long Lama about 142km from
Miri city, and Long Keseh about
50km further inland.
PKR environmental bureau chief
Lee Chean Chung said the party
would lend its support to the Baram people in their struggle to protect their homes from destruction.
“Our bureau will be organising
a trip to Baram from May 10 to 17
to [lend] support and solidarity to
the Baram people in their struggle against the construction of the
1,200mw dam,” he said.
Lee, who is also the Semambu
assembly member, said the project
would displace some 20,000 people
into resettlement areas.
He said the dam when completed, will flood 400 sq km of rainforest, destroy the Baram people’s centuries-old longhouses, the graves
of their ancestors, padi fields and
orchards.
“The Baram Dam is not a standalone issue. It is only one of 12 proposed by the state government to
generate power needed to fire its
ambitious plan to propel Sarawak
into an industrialised and developed state by 2030,” he said.
Lee said PKR recognised that
Sarawakians had long fought for
their environmental rights and
justice.
Land grabs, forced displacement
of natives, deforestation and institutionalised marginalisation of
vulnerable residents had been a
long-standing issue in the state,
he said.
“It cannot be improved by merely changing the chief minister and
top officials.
“A thorough institutional reform,
democratisation and change of
mindset are required regarding the
role of government and the meaning of development.
“Therefore, apart from giving
moral support, the solidarity trip
will also have sharing and empowerment programmes to help us
learn from each other about the
struggles for environmental justice,” he said.
Lee will share experiences from
the Stop Lynas Campaign in Kuantan, while other group members
share their expertise.
He said interested individuals
or non-governmental organisations are invited to join the trip
and contribute their support for
the struggle. — The Malaysian
Insider
H O M E 15
M O N DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY
Six schools to
receive RM1.2m
for new halls
BUKIT MERTAJAM: Six schools
in the Permatang Pauh parliamentary constituency will get
halls after receiving an allocation of RM200,000 each from
the federal government.
The construction of the open
halls is expected to be completed
in three months.
Deputy Prime Minister Tan
Sri Muhyiddin Yassin yesterday handed over project plans
of the open halls to the six
schools involved: Sekolah Kebangsaan (SK) Seberang Jaya
2, Sekolah Menengah Kebangsaan (SMK) Pauh Jaya, SK Bukit
Indera Muda, SK Permatang Tok
Kandu, SK Seri Penanti and SK
Mengkuang.
He officiated at the opening
of SMK Samagagah’s open hall
and aid presentation to 15 needy
persons here during his one-day
working visit to Penang.
Meanwhile, Umno Permatang Pauh division chief Datuk
Mohd Zaidi Mohd Said said 11
schools in the area had been
identified to get new open halls.
He said SMK Samagagah was
among five schools that already
had new open halls being built
for RM200,000 each. — Bernama
BN to field clean candidate for
Permatang Pauh by-election
Muhyiddin: Umno division has unofficially submitted several names
BUKIT MERTAJAM: Barisan Nasional (BN) will consider all factors
— especially a clean record and the
acceptance of local residents — in
determining the candidate for the
Permatang Pauh parliamentary
by-election, said Deputy Prime
Minister Tan Sri Muhyiddin Yassin.
He said the Umno division
has unofficially submitted several names as candidates for the
by-election and a decision will be
made by the party’s top leadership soon.
“We consider all factors. What’s
important is the acceptance of Permatang Pauh voters. [The candidate] must have a good track record,
not involved in any scandal, highly
qualified and close to the locals.
“Ideally, they (the candidates)
should be locals with good track
records,” he told a press conference
after chairing a meeting with state
Umno and BN leaders yesterday.
Also present was Umno secre-
Muhyiddin: We
consider all
factors. What’s
important is the
acceptance of
Permatang Pauh
voters. Photo by
The Malaysian
Insider
tary-general Datuk Seri Tengku
Adnan Tengku Mansor.
The deputy prime minister said
Umno Permatang Pauh and the
state Umno had also expressed their
commitment to give full support to
the candidate decided by the top
leadership.
Muhyiddin, who is the director
of the Permatang Pauh and Romp-
in by-elections, said he would be
assisted by Umno vice-presidents
Datuk Seri Dr Ahmad Zahid Hamidi in Permatang Pauh and Datuk Seri Hishammuddin Hussein
in Rompin.
Another Umno vice-president,
Datuk Seri Mohd Shafie Apdal, had
been appointed as the coordinator
of both by-elections, he said.
“We will set up a strong strategy
for the by-election. We know we are
the underdog in the constituency
which is said to be a PKR stronghold, but nothing is impossible ...
BN’s hopes are to win,” he said.
The Permatang Pauh seat has
been declared vacant after its incumbent, Datuk Seri Anwar Ibrahim, was disqualified as a Member
of Parliament on March 16, after
the Pardons Board rejected a petition for a royal pardon sought by
the opposition leader’s family over
his conviction for sodomising his
former aide, Mohd Saiful Bukhari
Azlan.
The Election Commission set
April 25 as the nomination day,
early voting on May 3 and the polling day on May 7.
In the 2013 general election, Anwar retained the Permatang Pauh
seat after defeating BN candidate
Dr Mazlan Ismail with a majority
of 11,721 votes. — Bernama
16 H O M E
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
Unity council to
push for communal
relations laws
Legislations are to tackle discrimination and set up a
harmony commission
BY SHERI DA N MAHAV ERA
KUALA LUMPUR: New laws to manage communal relations which are
supposed to replace the Sedition
Act are still relevant even as the
government decides to keep the
colonial-era law, said a member
of the National Unity Consultative
Council (NUCC) which crafted the
new legislation.
Datuk Saifuddin Abdullah said
these laws were supposed to tackle discrimination and set up a new
commission to deal with ethnic and
religious tensions — two elements
not in the amended Sedition Act.
“There were three aims of the
new laws to replace the Sedition Act.
The first aim was to criminalise hate
speech. This was to directly replace
the Sedition Act.
“But there are two other aims: to
deal with discrimination and to set
up a national harmony commission.
“The bills for these two other
aims can still be pursued and we
are moving forward with them,”
said Saifuddin.
The NUCC was formed in 2013 to
find new ways to bridge Malaysia’s
ethnic and religious divides.
One of its tasks was to propose
new laws which can replace the
Sedition Act but at the same time,
make hate speech a crime.
Another NUCC member, Datuk
Mujahid Yusof Rawa doubts whether
Putrajaya would go ahead with the
other two proposed laws since all
Saifuddin: There were three aims of the
new laws to replace the Sedition Act.
Photo by The Malaysian Insider
three were meant to be in a package.
“They can still incorporate elements from the other two bills but
I do not know. We are disappointed
because the administration chose
to maintain the Sedition Act.”
Saifuddin’s comments follow
Putrajaya’s U-turn to keep the Sedition Act despite pledging in 2012
to repeal it.
Last Friday, the Dewan Rakyat
passed several controversial amendments aimed at “strengthening”
the act which human rights groups
and opposition politicians claimed
would stifle free speech.
Mujahid said the racial and religious hate crimes bill, which the
NUCC proposed and which was
supposed to replace the Sedition
Act, would have been a better law.
“The new law would have set a
higher burden of proof to prove that
someone was out to create hostility
between different communities.
“To prove that something is hate
speech, you have to prove intent,”
said Mujahid, who is also Parit Buntar Member of Parliament and a
member of the NUCC’s committee
which proposed the new laws.
Saifuddin, a former minister, said
the new laws would be submitted
to Putrajaya in the NUCC’s report
by the middle of the year.
The law to deal with discrimination would make it illegal to discriminate individuals based on gender,
ethnicity, religion, descent, place of
birth and disability, he said.
Another law would establish a
communal harmony and reconciliation commission, which can act
as a mediator in cases of communal friction.
“This can be fights between
neighbours, road rage or even child
custody battles between inter-faith
couples,” said Saifuddin, adding that
the body would be similar to the Malaysian Human Rights Commission
or Suhakam.
The commission could compel
community leaders to appear before the body to tone down public
rhetoric and seek to resolve disputes,
said Saifuddin, who is also Global
Movement of Moderates Foundation
chairman. — The Malaysian Insider
Non-traditional security threats
can jeopardise sovereignty
KUALA LUMPUR: The Asean community, especially Malaysians, must
understand that non-traditional security threats, if not effectively tackled, can jeopardise national security
and sovereignty.
Universiti Teknologi Malaysia
(UTM) geostrategist Dr Azmi Hassan
said it is important for people in this
region to understand what is meant
by non-traditional security threat as
they are unaware that it is rampant
in their societies.
“Non-traditional security threats
are something which are rarely
given attention to by society, but
if it happens, it can threaten the
nation or the surrounding areas,
and even create conflicts in relations between nations.
“In the Asean context, such as in
human trafficking, it is not a problem of national security, but it can
threaten the sovereignty and relations between two countries,” he
said in an interview recently.
Azmi said the intrusions in Lahad
Datu, Sabah in 2013 were an example
how non-traditional security threats
became bloody incidents.
“About 20 years ago, the presence
of foreigners was not a security threat
but now this could disrupt security,
resulting in us having to form the
Eastern Sabah Security Command.”
He said the increase in the number of Malaysians and other nationalities involved in the Islamic State
militant group, as they were influenced by ideologies which were
supposedly based on religion, was
proof of how non-traditional security threats could be prone to extremism. “We can categorise IS as
a non-traditional threat, as it is not
a formal group, nation or organisation,” he said.
Azmi added this was why it was
important for Asean to be united to
resolve the issue, including sharing
intelligence information.
Meanwhile, Universiti Utara Malaysia’s Dean of the College of Law,
Government and International Studies associate professor Dr Ahmad
Marthada Mohamed said Malaysia
as chairman of Asean 2015 has an
advantage as it is known for unity
and harmony in a multiracial society. — Bernama
Sedition Act changes intended to
choke free flow of information
BY V A N B A L AG A N
KUALA LUMPUR: Putrajaya is attempting to regulate news portals
and other social media users that
are critical of the establishment
through amendments to the Sedition Act that were approved by
the Dewan Rakyat last Thursday,
lawyers said.
They said the changes were not
only intended to check on news
articles or commentaries deemed
seditious, but also to curb feedback from readers.
The lawyers said provisions
in the law could be used to remove any information that, in the
opinion of the establishment, was
against government leaders and
organisations.
Civil rights lawyer Syahredzan
Johan said the amendments were
targeted against news portals and
Internet users like bloggers, and
social media users who provided
alternative views and comments.
He said the amendment that
gave powers to the court to prohibit the circulation of seditious
publications was a serious attack
against free speech and expression
in a democratic society.
Vague words such as “likely”
and “appears” were relied upon
to allow the public prosecutor to
convince the courts to remove
publications deemed seditious
in the electronic media, he noted.
“The threshold of what is seditious is low and this is sufficient
for the court to allow applications
by government lawyers.”
New provisions in the law state,
among others, that publications
that are likely to lead to bodily
injury or damage to property or
appear to be promoting ill will,
hostility, hatred between different
races on grounds of religion are
seditious in tendency.
Syahredzan said in such cases,
the court could order the removal
of the said material and ban the
person making or circulating the
prohibited publication from using
any electronic devices.
Further, the court could order
an officer authorised under the
Communications and Multimedia Act to remove online seditious
materials put up by persons who
could not be identified.
“This is a major arsenal that
the government can utilise and
I foresee that news portals will
be asked to remove critical comments from its readers and subscribers,” he added.
Lawyer Eric Paulsen said the
amendments were used as a mask
to impose Internet censorship because the government was unable
to come to terms with the Internet
and social media era.
“Unlike newspapers which are
licensed, the authorities do not
have control over how information
is disseminated by the alternative
media which are gaining popularity,” said Paulsen, the executive
director of Lawyers for Liberty.
The government, he said, was
going to the other extreme by using excessive means to try to control what could and could not be
published.
The Institute of Journalists Malaysia (IOJ) also expressed con-
Syahredzan: The threshold of what
is seditious is low. Photo by The
Malaysian Insider
cern that the amendment did not
specify an expiry date for prohibition orders obtained from the
court.
“The inability to access tools of
the trade will mean online journalists’ careers are at risk and
threatens the existence of legitimate news portals,” it said in a
statement.
It said the prohibition on
“propagating” seditious speech
or their publication also meant
that online news portals could
not share allegedly seditious remarks on social media, and Rich
Site Summary feeds would cease
to exist, further silencing discussion of policies and issues which
are of national interest.
The situation is further exacerbated by the heavy penalty for
first-time offenders who contravene a prohibition order, as they
face a maximum fine of RM5,000
or a jail term of up to three years.
“This latest curtailment of freedom of expression further restricts
public discourse and will create
a void in Malaysian social media
and a deafening silence in news
forums,” said the IoJ.
Constitutional lawyer Nizam
Bashir said that, via the new Section 10A of the Sedition Act, the
court could order an authorised
officer to remove articles and comments that were deemed seditious.
However, he said amendments
to the sedition law appeared inconsistent with Section 3 (3) of the
Communications and Multimedia
Act, which guarantees no censorship of the Internet, specifically if
the authorised officer is attached
to the MCMC.
Universiti Sains Malaysia Communication Studies Faculty senior
lecturer Assoc Prof Mohamad Md
Yusoff said the government should
consider compelling all Facebook
users to register their accounts
with the Malaysian Communications and Multimedia Commission .
He said the move was better
compared with blocking access
to the social network websites to
prevent abuse by users.
However, DAP secretary-general Lim Guan Eng threatened
that his party would organise
nationwide protests to oppose
any attempt to ban or close down
Facebook, citing the right for freedom of expression and Putrajaya’s
pledge not to censor the Internet.
There are 15 million Malaysian Facebook accounts. — The
Malaysian Insider
H O M E B U S I N E S S 17
M ON DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY
WEEK
IN FOCUS
Photos by Chu Juck Seng,
Patrick Goh, Shahrin Yahya,
Suhaimi Yusuf & Sam Fong
1
(From left) MCT Bhd non-independent deputy executive
chairman Tan Sri Barry Goh, independent non-executive chairman Tan Sri Abi Musa Asa’ari
Mohamed Nor and Bursa Malaysia Bhd chief executive officer Datuk Tajuddin Atan at the
company’s listing ceremony in
Kuala Lumpur on April 6.
2
JOINT PROJECT ... (From left) Deputy Science, Technology and Innovation Minister Datuk Dr Abu Bakar Mohamad Diah, NanoMalaysia Bhd chief executive officer (CEO)
Dr Rezal Khairi Ahmad and Nanopac Innovation Ltd CEO Datuk Dr Cheng Kok Leong at the groundbreaking ceremony for Nano Valley and Nano Solar Factory in Behrang, Perak on
April 5. The setting up of Nano Valley is the world’s first-ever nanotechnology-based solar research factory.
(Seated, from left) K&N Kenanga
Holdings Bhd senior executive
director Bruce Kho, group managing director Datuk Chay Wai
Leong, Tokai Tokyo Financial
Holdings Inc president and chief
executive officer Tateaki Ishida
and Tokai Tokyo Securities Co
Ltd adviser to the chairman Datuk Akira Okabe with members
of their teams (standing) at the
signing of a business cooperation
agreement between K&N Kenanga and Tokai Tokyo Financial in
Kuala Lumpur on April 9.
3
(From left) UEM Sunrise Bhd
acting chief marketing officer
Zadil Hanief Mohamad Zaidi,
chief financial officer Azhar Othman, Iskandar Regional Development Authority chief executive Datuk Ismail Ibrahim and
Cahaya Jauhar Sdn Bhd chief
operating officer Mohd Auzir
Mohd Tahir at the unveiling of
the Gerbang Nusajaya project
at Puteri Harbour in Nusajaya,
Johor on April 8.
4
1
International Alternative Investment Review (IAIR) group
president Guido Giommi (left)
presenting Mah Sing Group Bhd
executive director Datuk Steven
Ng with the best company for
leadership property development award (real estate category) at the IAIR awards ceremony
in Hong Kong on March 10.
2
5
(From left) Malayan Banking
Bhd (Maybank) president and
chief executive officer Datuk Abdul Farid Alias, chairman Tan
Sri Megat Zaharuddin Megat
Mohd and group chief financial
officer Mohamed Rafique Merican at a press conference after
Maybank’s 55th annual general
meeting in Kuala Lumpur on
April 7.
3
5
4
6
6
(From left) RAM Holdings Bhd
chairman Tan Sri Siti Norma
Yaakob, Minister in the Prime
Minister’s Department Datuk
Seri Abdul Wahid Omar, Standard Chartered Saadiq Bhd chief
executive officer (CEO) Adhha
Abdullah and RAM group CEO
and executive director Datuk
Seri Dr K Govindan at the 12th
Annual RAM League Awards.
Standard Chartered Bank Malaysia Bhd clinched two awards
in recognition of its outstanding
accomplishments in the Malaysian bond market in Kuala Lumpur on March 27. Abdul Wahid
presented the awards.
18 FO CU S
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
T
New Oysterflex
bracelet reimagines
the rubber strap
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BY STEPHEN PULVIRENT
R
olex doesn’t do anything halfway. When the curtains went
up at Baselworld 2015, we were
as surprised as everyone else to
see a strange rubber strap on the
new Everose gold Yacht-Master sitting in the Rolex booth window. Precious-metal sport watches are nothing new
for Rolex, but a rubber strap seems almost
too cool and under the radar for the brand.
We should have known it was no ordinary
rubber strap, though. It’s the new Oysterflex
bracelet, and it deserves a closer look.
Most rubber straps are about as simple
an affair as a watch strap can be: two pieces
of injection-moulded rubber, one with holes
and the other with a buckle at the end. They’re
flexible, they don’t get smelly or absorb sweat,
and they lend some fake deep-sea diving
credibility to those of us who spend most of
our watch-wearing days above the surface.
There’s really little need to innovate or add
anything here, but of course Rolex found
ways to make this basic accessory even better.
Every Rolex employee I’ve spoken with
(along with the pile of marketing material out
there) is careful to refer to the Oysterflex as a
bracelet and not a strap. Typically, metal links
qualify as a bracelet, while a leather, rubber,
or fabric band would be called a strap. The
Oysterflex is not an injection-moulded rubber strap, but instead a two-piece titanium
bracelet with a rubber coating.
Yes, that’s both as prosaic and as complicated as it sounds.
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03
04
01. It was most surprising to see a strange rubber strap on the new Everose gold YachtMaster at Baselworld 2015.
01
02. Using a gold Oysterlock clasp is overkill but feels totally appropriate here.
The foundation of the Oysterflex is a pair
of titanium blades, one on each side of the
watch. These are coated in black elastomer
(a substance similar to what you’ll find on the
Apple Watch) and anchored to the Yacht-Master’s case. Underneath each half is a patented
longitudinal cushion system, which is basically
a collection of strange rubber flaps with a funny name. They’re supposed to “stabilise” the
watch, but more on that later. The solid Everose
gold Oysterlock clasp holding the two pieces
together seems like overkill, but anything else
in this context might feel like a letdown.
On the wrist the Oysterflex does have the
same rigidity that you’d expect from a metal
bracelet but without that cold, silky feeling
03. The Oysterflex bracelet is a far cry from your typical rubber strap.
04. The patented cushioning system is strange-looking but effective. Photos by Bloomberg
when you first put it on. I don’t know if I feel
like those pads stabilise the watch (whatever
that means), but they do allow some air to
circulate between the rubber and your skin.
A few hours into a hot day this will become
your favourite feature, I promise. I thought I’d
find the gold clasp annoying and heavy, but it
actually balances out the watch nicely, making the whole package feel more complete.
There are no two ways about it: The Oysterflex bracelet is one of the most overengi-
neered, overly complicated, and probably
unnecessary watch accessories ever. But
that’s kind of why it’s so awesome. Someone
at Rolex headquarters decided a rubber strap
might be an interesting idea to think about,
and then followed that out to its logical conclusion, giving us a titanium and rubber hybrid that has a patented cushioning system
and a solid gold clasp.
That’s a kind of thinking I can get behind.
— Bloomberg
An astronaut’s 18K gold Omega chronograph
BY STEPH EN PU LV IR ENT
THE Omega Speedmaster beat out the Rolex
Daytona and a handful of other chronographs to be Nasa’s official choice for
mid-century astronauts. That’s right. Watches. In. Space. Today, many people call the
Speedy the Moonwatch because of this. (In
Apollo 13, you can see Tom Hanks dramatically fiddling with his to time the events that
would bring everyone back home safely.)
The watches that actually made it beyond
the stratosphere were more modest steel
chronos, but this solid 18K gold Speedy Pro
was presented to Apollo 12 astronaut Alan
Bean once he was back on earth. And now
it’s hitting the block.
Designed in 1969 to commemorate the
first moon landing, only 1,014 watches of
this model were ever produced — and this
gold Speedmaster Professional is of an even
rarer subset, one of 30 given to President
Richard Nixon, Vice President Spiro Ag
new, and the Apollo 12 astronauts. It’s No
26, to be exact, and belonged to Bean, who
MO
01. This 18k gold Omega Speedmaster belonged to an
actual astronaut, though it didn’t go to space.
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02. ‘To mark man’s conquest of space with time,
through time, on time’. The engraved caseback
commemorates when the gift was given. Photos by
Bloomberg
01
02
became the fourth person to walk on the
moon and later took another trip to space
in the early 1970s. The caseback engraving
explicitly says that this watch marks “man’s
conquest of space with time, through time,
on time”.
Seriously, it just doesn’t get any cooler
than that.
The watch itself is quite similar to the
steel Speedmasters that went to the moon.
Inside is the caliber 861 movement, a slightly less expensive and robust version of the
caliber 321 that sat inside Buzz Aldrin’s
watch, but it still has the same familiar
dial layout and pump-style pushers. The
tachymeter bezel is black, but the 18K gold
gives the optical illusion of it having a deep
burgundy colour, amplified by the blockier hour markers. At 42mm, the watch was
absolutely massive for the time, making it
particularly well-suited to being strapped
over a spacesuit for easy reading on the fly.
With an estimate price of between
US$40,000 (RM146,400) and US$60,000,
this 18K gold Omega Speedmaster is lot 141
in Bonhams’ Space History Sale on April
21. — Bloomberg
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21
FO CU S 19
M O N DAY A PR I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY
The beauty and logic of the million-dollar car
BY HANNAH ELLIOTT
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SEEN Furious 7 yet? You should. Among the
film’s hard bodies and the muscled engines,
there’s a sexy little number that stands head
and haunches above the rest: It’s called the
Lykan HyperSport. The car is a US$3.4 million
(RM12.44 million) beast with a top speed of
240mph (386kph) and the face of a raptor. The
huge audiences who saw the movie recently
won’t soon forget it — even if they’ll likely
never see the vehicle in real life.
The Lykan is the first supercar made by a
company (W Motors) based in the Middle
East (formed in Beirut, with headquarters in
Dubai). It’s also among the most expensive
production cars ever to go on sale. But it’s not
the only land rocket to come out lately that
costs more than a million dollars. Far from it.
Over the past decade we’ve seen almost
every automaker (that calls itself a true “luxury” brand, at least) produce a contraption
with a seven-digit price tag. Sometimes, they
get there only by making a one-off with diamond-rimmed headlights and titanium bones,
but they get there.
The brands make these cars because people buy them. The past few years have seen
an explosion of royals and tycoons around
the globe who buy the entire fleet of Aston
Martins and Lamborghinis to support their
proclivities. Bloomberg has discovered more
than three dozen new billionaires in the
world since January alone, and more than
300 since 2012. They buy the cars in Los Angeles, Doha, Moscow, Sao Paulo and Shanghai. Some, like hotel tycoon Steve Wynn, buy
them to bolster their business interests just
as much as their personal life.
For them, it’s not that big a deal.
“The fact of the matter is there are a lot of
rich people around the world, and I mean
super rich — hundreds of millions of dollars
to billions of dollars of net worth,” says Jack
Nerad, executive market analyst for Kelley
Blue Book. “When you’re talking about these
types of people, a million-dollar car isn’t really
much of a stretch at all.”
It’s also lucrative for the carmakers, despite
the extra work required to specialise in a given
automobile. Margins on a standard Ferrari or
Lamborghini hover around 15%, and when the
price tag on a particular car reaches into seven
figures, that amount can increase significantly.
If you have to set up a separate assembly
line, it can become expensive to produce an
automobile, Nerad says. “But with million-dollar cars, there’s still money to be made.”
The basic rule is that it takes US$1 billion to
develop and produce a normal mass-market
car. But developing one that’s not accessible
to the public can cost less than that because
resource needs are narrowed. Plus, it’s easier
to recoup the expense when price tags are in
the millions rather than, say, US$30,000. That’s
true even if a company sells only 300 cars.
Lamborghini made three Venenos to celebrate its 50th birthday -— and the supercar is
fittingly named after one of the most famous, most aggressive Spanish fighting bulls. Each
has a V12 engine and 740 horsepower, with a top speed of 221mph and a paint job recalling the
Italian flag. Price: US$4 million. Photos by Bloomberg
The Lamborghini Sesto Elemento V10 coupe premiered at the 2010
Paris Motor Show. It has a six-speed semi-automatic transmission
and a 0mph to 60mph sprint of 2.5 seconds. Fast, yes -— but it comes
without a radio or air conditioning. Price: US$2.2 million.
The Porsche 918 Spyder hybrid will hit 60mph in 2.6
seconds and has a top speed of 210mph. It comes
with a V8 engine paired with lithium ion electric
batteries. Base models start at US$845,000, but
upgrades push the cost up much higher.
The Koenigsegg Regera hybrid is the company’s latest
model. It has a twin-turbo V8 engine paired with three
electric motors for a total combined output that’s the
equivalent of 1,489 horsepower. Top speed is 249mph;
only 80 will be made. Price: US$1.9 million.
The Lykan HyperSport premiered at the
International Dubai Motor Show in 2013. Top speed
is 239mph, with a 0 to 60 sprint time of 2.8 seconds.
The car is rumoured to have diamond and titanium
accents in its headlights. Price: US$3.4 million.
These super expensive cars fall into different categories. Some, like the Bugatti
Veyron and Lyons Motor Car’s LM2, are truly
unique and made in minuscule production
numbers. Others are special editions of existing models.
Let’s look at how a Rolls-Royce gets to a
million dollars. A base-level Phantom starts
at about US$400,000. Then you add custom
treatment, which most of them receive: That’s
special wood, paint, and leather that can hike
the price by hundreds of thousands of dollars.
Getting the full-armoured treatment on a sedan
can cost almost half a million dollars alone.
And at that point the real heavyweight treatment starts: true bespoke, one-of-one work
that adds precious gem and pearl accents,
hand-stitching, bullet-proofing, theatre systems and elite engine tuning.
That last stage is where a standard Phantom
crosses the million-dollar threshold.
“The trend is growing, and it’s driven by
bespoke cars like our Serenity,” says Gerry
Spahn, Rolls-Royce’s head of communications,
referring to the US$1.5 million Phantom it introduced last month in Geneva.
You can probably get speed or strength
or comfort in such an expensive car, but
not all three.
Then there’s what automakers call a “halo
car”. That’s when a brand that makes several
different lines comes out with a concept car or
ultra high-end superstar that serves a purpose
beyond its own price tag. In fact, the indirect
monetary benefits of making a halo hypercar
are usually more important than direct profit.
High-profile products can make the entire
brand shine like a backlit Hope Diamond -—
the brilliance associated with the crown jewel
car inevitably rubs off onto the less expensive
offerings in the fleet. If the cachet is compelling enough, it will deliver cash.
Finally, some automakers don’t want to
persuade a broader market to buy their cars.
Ultra-niche supercar companies such as Koenigsegg, Zenvo, and the aforementioned Lykan
make limited runs of cars whose price tags can
soar into the multimillions. They’re selling
only to the super rich, and in those cases the
exclusivity is a big part of the draw: You can’t
drive these cars except on a track, but that’s
okay, because no one else can drive them at all.
These efforts are often a gamble — high
risk, and not always high rewards. Zenvo, in
Denmark, will make only 15 of its US$952,000
ST1 supercars. They’re betting that the top
speed of 233mph and 1,104 horsepower will
help them sell through the line, at which point
the owners estimate they’ll break even. But
before the Geneva Motor Show this year, the
company had delivered only two and received
orders for five more. Then it’ll be a few years
before Zenvo can roll a new model off the
production floor — a time period when bigger
automakers can accomplish all kinds of feats.
Or consider the US$2 million Pagani Zonda,
which has a certain flair but has endured persistent criticisms about its high maintenance
costs and propensity to break down under even
the slightest inclement conditions.
“Exotic cars are fairly unpractical,” says
Cars.com’s Mays, in the understatement of the
week. “You need a whole garage of things to
drive when you own one of these — things that
are a bit more rugged. With something like a
Pagani, you need real roads and, ultimately,
racetracks to stretch its legs.”
Of course, if you’re wealthy enough to afford something like the Pagani, you’re wealthy
enough to afford the racetrack that goes with
it. — Bloomberg
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The Maybach Exelero was introduced in 2004 and even then was notable
for its extremely high price and famous reputed owner (the rapper
Birdman; it also appeared in the Jay Z music video Lost One). Top speed is
218mph, and it can hit 60mph in 4.4 seconds. Price: US$8 million.
The Lyons Motor Car LM2 Streamliner. Price: US$1.3 million
(estimated). Photos by Lyons Motor via Bloomberg
The Aston Martin One-77 was unveiled in Paris in 2008 as the
British automaker’s most expensive offering to date. It has a V12,
750-horsepower engine, and only 77 were made. Price: US$1.7 million.
22 C O M M E N T
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
Britain in political turbulence
Broadcast debate proves meltdown of two-party system
BY JOHN LLOYD
L
ast week in Britain, four
men and three women
faced the cameras in a
broadcast debate that
not only marked the
start of a crucial election campaign but also served as
proof of the meltdown of what had
been one of the world’s most stable
two-party political systems.
The plethora of parties vying for
representation in the mother of Parliaments may bring about the mother
of all political turbulence. The candidates are plunging Britain into an uneasy time that will only become more
intense after the May 7 vote. There
is no avoiding it, with one exception
— the men representing parties that
have existed for a century — the Labour Party, led by Ed Miliband, and
the Conservative Party, led by Prime
Minster David Cameron.
The Liberal Democratic Party, led
by Deputy Prime Minister Nick Clegg,
is the heir to the 19th-century Liberals. The exception is Nigel Farage,
leader of the United Kingdom Independence Party founded 12 years ago.
The women are the real radicals.
Nicola Sturgeon, new leader of the
Scottish National Party, is a Scot;
Leanne Wood of Plaid Cymru, the
party of Wales, is a Welsh; and Na-
talie Bennett of the Green Party is,
surprisingly, an Australian.
The first two want to break up
Britain by taking Scotland or Wales
out of the union. Bennett wants “a
radical transformation of society
for the benefit of all”, which would
mean low or no growth.
All are hostile to “austerity”, the
economic policy followed throughout Europe that focuses on reducing
national budget deficits through a
mixture of public-sector cuts and
tax increases.
The three main party leaders
represent the great forces of the
20th century, a century in which
Britain started out as the motherland of the largest empire the world
had seen — and ended with Britain
still rich and of some importance
but no more geographically than
two islands off the west coast of
Europe, one of which is also occupied by another state, Ireland.
The Liberal Party governed before
World War I and faded rapidly thereafter. Since then, the Conservatives
and Labour managed the transition
from grandeur to normalcy.
The forces they represented
(never exclusively) — the professional, commercial and employing
classes versus organised labour and
the intelligentsia, broadly defined
— were never in danger of rebelling
against each other.
In the past few decades, all
classes demanded of both these
Cameron emphasises, banking on Miliband’s relative unpopularity, that only one of the
two can become the prime minister. Photo by Reuters
parties roughly the same things —
increased consumption, continuously-socialised medicine, education and social care, more-or-less
free markets, free press and free
speech, and a secular state.
Britain, like other states, thinks it
is special. So it is. At the same time, it
is very much like the other peaceful,
rich states of Western Europe.
The other four people who faced
the cameras challenged much of
that. For Sturgeon and Wood, the
20th century was a loss of external
imperial rule and a strengthening of
internal imperialism over the other
nations of Britain.
“London rule” is the common
bogeyman. It conjures up an image
of a capital divorced from the reality
of Welsh valleys or Scottish lowlands,
both scarred by the 19th-century in-
dustries that had fuelled the empire.
Farage of the UK Independent
Party has two main arguments. One,
there are too many immigrants in
Britain and their number must be
sharply reduced to roughly 30,000
to 50,000 a year. Two, Britain must
leave the European Union.
Farage has many fans across
Britain, especially outside London.
Though his party has faded since
winning the largest vote in the 2014
European Parliament elections, it
may take some seats in the May vote,
which will defy the British bias that
the first past the post-electoral system
presents for all new parties.
Meanwhile, Cameron and
Miliband see each other as major
enemies. Cameron emphasises,
banking on Miliband’s relative unpopularity, that only one of the two
can become the prime minister.
However, both are conscious —
more than any of their predecessors
in the past 100 years — that the
basic offerings of their parties are
peeling and flaking off. Consider
this: the Conservatives’ full name
is the Conservative and Unionist
Party. In contrast, the insurgents,
especially in Scotland, have the
wind at their backs.
Labour, as its name proclaims,
should be hostile to an austerity policy
that hits the poor and working classes
hardest, but it can’t afford to be seen
as reckless or insouciant about debt,
or destructive to the relatively healthy
economic growth that the Conservatives have managed to encourage.
Clegg has struggled to convince
his followers that his small party’s
participation in the government
over the past five years has made
the country more liberal or, indeed,
more democratic. However, the great
causes of the Liberals have long been
absorbed into left and right policies.
Cameron, Miliband and Clegg
are in the same moderate boat. They
face four who see radicalism as their
best trick. All seven are trying to navigate currents already treacherous
for parliamentary rule, including
social media and the Internet, the
rise of new powers like China and
India, and the decline of the environment carved into the measured
decorousness of the old representative democracies. — Reuters
American leadership in a multipolar world
BY PAOL A SU B ACCHI
GIVING up the spotlight is never
easy. The United States, like many
ageing celebrities, is struggling to
share the stage with new faces, especially China. Upcoming meetings
of the International Monetary Fund
(IMF) and the World Bank — two
institutions dominated by the US
and its Western allies — provide an
ideal opportunity to change that.
The US must come to terms
with the reality that the world has
changed. The longer the US remains
in a state of denial, the more damage
it will do to its interests and global
influence, which remain substantial,
if more constrained than before.
The world no longer adheres to
the static Cold War order, with two
blocs locked in open but guarded
confrontation. Nor does it work
according to the Pax Americana
that dominated in the decade after
the Soviet Union’s collapse, when
the US briefly emerged as the sole
superpower.
Today’s world is underpinned by
a multipolar order, which emerged
from the rise of developing economies — most notably China — as
major actors in trade and finance.
The US — not to mention the other
Group of Seven countries — now
must compete and cooperate not
only with China, but also with India,
Brazil and others through expanded
forums like the Group of 20.
To this end, the US must show
leadership and adaptability. It cannot
refuse to support China’s efforts to
expand its role in global governance.
Nor should it issue harsh rebukes to
its allies when they do not follow suit,
as it did when the United Kingdom
announced its intention to join the
new China-led Asian Infrastructure
Investment Bank (AIIB).
The US seems to be stuck in the
Bretton Woods system, the rule-based
order — underpinned by the IMF and
the World Bank, with the US dollar at
its heart — that emerged after World
War II. The Bretton Woods system institutionalised America’s geopolitical
supremacy, leaving the old imperial
power — the UK — to step aside, a
step that it took graciously — if a little
desperately — given its grave postwar economic situation.
Over the years, however, the Bretton Woods system, with its mix of liberal multilateralism and market-oriented economic policies, has come
to symbolise the Anglo-American
dominance of the global economy
that much of the world now criticises,
especially since the global financial
crisis. In particular, the Washington
Consensus — the set of free-market
principles that influences policies of
the IMF, the World Bank, the US and
the UK — has generated considerable
resentment, especially after the Asian
financial crisis in the 1990s.
Against this backdrop, it is hardly
surprising that China uses its growing
global influence to help engineer a
new economic order — one in which
the US dollar does not reign supreme.
Zhou Xiaochuan, the governor of China’s central bank — the People’s Bank
of China — has repeatedly called
for a shift towards an international
monetary system that allows the use
of multiple currencies for payments
and investments. Such an approach
would reduce the risk and impact of
liquidity crises, while decoupling the
international monetary system from
“economic conditions and sovereign
interests of any single country”.
Of course, China believes that its
own currency — the yuan — should
eventually play a central role in this
new monetary system, so that it reflects China’s role not only as a leading
engine of global economic growth,
but also as the world’s largest creditor.
Indeed, together with other systemically important economies — the US,
the UK, Japan and the eurozone —
China drives trends that, for better or
worse, extend far beyond its borders.
Since 2009, China’s leadership has
been pursuing a set of policies that
encourage the use of the yuan in regional trade and reduce its dependence on the US dollar in international
payments. However, expanding the
yuan’s role in the international monetary system is just the first step towards institutionalising a multipolar
world order. China has also spearheaded the establishment of new
multilateral institutions, with the
AIIB following on the heels of the
New Development Bank — created
with other major emerging economies, including Brazil, Russia, India
and South Africa.
By taking these steps, China’s leaders have called attention to the inadequacy of the existing international
monetary system — and its institutional framework — in today’s complex, multipolar world economy. In
particular, China’s agenda highlights
questions about America’s capacity to
provide the needed liquidity to support international trade and finance.
To be sure, the US is right to
wonder whether the new order —
that China hopes to build — will
be as open and rule-based as the
American-led order, the one that
gave China the market access it
needed to achieve its spectacular
economic rise. However, the answer
to that question can be found only
by engaging China on the issue of
global governance reform — not
by denying that change is needed.
As the US stubbornly pursues
a policy of containment towards
China — exemplified in its fight
against the AIIB’s establishment, its
relentless accusations of currency
manipulation and its refusal to ratify IMF reforms that would increase
China’s influence — it risks losing its ability to shape what comes
next. The result could be a world of
fragmented blocs, an outcome that
would undermine not only global
prosperity, but also cooperation
on shared challenges.
Spring Meetings of the IMF and
the World Bank offer an important opportunity to signal a new
approach towards China. There is
no signal more credible than US
support for the yuan’s addition to
the basket of currencies that the
IMF uses to value its international
reserve assets — the Special Drawing Rights. America will be in the
spotlight once again, but how will
it perform? — Project Syndicate
Paola Subacchi is the research director of international economics
at Chatham House and a professor of economics at the University
of Bologna.
W O R L D B U S I N E S S 23
M ON DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY
Hong Kong stock boomlet tests China’s capital dam
BY JOHN FOL EY
BEIJING: If the man-made dam that
separates China’s financial markets
from the rest of the world were removed, which way would the money flow? The sudden boom in Hong
Kong’s stock market, driven by mainland Chinese money and the promise of more to come, should leave no
doubt. The answer is out — and at
considerable speed.
Hong Kong’s benchmark stock index rose as much as 6.4% on April 9,
a day after Chinese investors maxed
out their quota on a cross-border
investment scheme launched five
months ago. The rush is hard to
square with actual events. True, China’s regulators on March 27 said the
mutual fund industry, with 4.4 trillion yuan (RM2.6 trillion) of assets at
the end of 2014 according to Z-Ben
Advisors, can now participate in the
Shanghai-Hong Kong Stock Connect.
But it’s unlikely many have. Tweaking paperwork could take weeks. A
new fund product requires around
20 days to get ready, Z-Ben estimates.
Perhaps investors have just got
wise to the gulf between Shanghai
and Hong Kong stocks. Shares in
Shanghai Electric Group, one of the
more popular trades, used to cost
69% less in Hong Kong two weeks
ago; now the gap is 47%. But that
is not new. And the stocks aren’t
yet interchangeable — though the
Hong Kong exchange is considering
a way to create something like substitutability, people familiar with the
situation say.
Most likely, the cause of the rally is simple speculation on the wall
of money bursting to get out of the
mainland, some of it fuelled by leaked
funds already sloshing around in
Hong Kong. That makes it problem-
IN BRIEF
atic. The previous slow start to the
Connect scheme was reassuring for
regulators on both sides who wanted to avoid the perception they are
promoting market manias. The latest surge may actually slow progress
towards further opening up.
For now the dam is secure, at least
as far as the Connect scheme goes.
But predicting what happens when
it is eventually dismantled must be
keeping China’s planners awake at
night. Pressure is building, and in
the People’s Republic where there’s
a will, there is always a workaround.
— Reuters
Commodity giants’ S’pore
trading hubs under fire
But companies deny any improper transfer pricing
BY RAC H EL A RMST RONG
SINGAPORE: The Singapore trading
hubs of the world’s largest commodity companies are coming under scrutiny from the governments
of some resource-producing countries who say they suspect they are
using units in the Southeast Asian
financial centre to avoid tax.
Some of the world’s largest oil,
mining and soft commodity companies book billions of dollars of revenue in the tiny island state every
year, where tax rates can be very
low, which is perfectly legal unless
they deliberately underprice group
China-led AIIB
will be lean,
clean and green
BEIJING: The China-led Asian
Infrastructure Investment Bank
(AIIB) will be lean, clean and
green, its interim chief said,
playing down concerns about
transparency and standards
governing the institution.
The US$50 billion (RM183
billion) bank, expected to start
operations by the end of the
year, is attracting a growing list
of countries, from Britain to India to New Zealand.
The AIIB is seen as a potential
rival to established lenders the
World Bank and Asian Development Bank, which are dominated
by the United States and Japan.
“Lean is cost effective; clean,
this bank will have zero-tolerance on corruption; green
means it’s going to promote
the economy,” China’s Xinhua
news agency quoted Jin Liqun,
secretary-general of the bank’s
multilateral interim secretariat,
telling a forum in Singapore on
Saturday. — Reuters
transactions so as to shift profit
there from units in other countries.
The companies deny any improper transfer pricing and say they are
in Singapore to be closer to Asian
clients, to local expertise and trade
routes, as the region accounts for
a growing share of their business.
The world’s two largest miners,
BHP Billiton and Rio Tinto, between them booked close to US$50
billion (RM183 billion) in revenue
in Singapore in 2013, according
to documents from the country’s
corporate registry, and posted a
combined net profit of more than
US$2 billion.
They mostly conduct trading
operations there, a high-volume,
low-margin business that involves
buying up commodities from their
global operations and selling them
to clients. They also look after logistics and risk management.
The companies say their Singaporean operations were not set up to cut
tax but to serve their clients better.
Australia and Indonesia’s tax
authorities say they are investigating whether arrangements like
these simply shift profits away from
where the commodities are extracted. Most jurisdictions require such
arrangements to have a commer-
cial purpose beyond saving tax,
and the group transactions should
be conducted at arms-length pricing. Australia and Indonesia both
rely heavily on mining exports and
count global miners among their
biggest taxpayers.
Australia’s tax office has said it
is conducting audits of 15 marketing hubs in Singapore and Switzerland that it says it expects will
raise an extra US$1 billion. It has
not identified the companies involved, although BHP and Rio told
an Australian Senate hearing last
Friday that their Singapore units
were being audited. — Reuters
Experts: India, France jet deal
may fuel trade partnership
BY ABHAYA SR I VAS TAVA
NEW DELHI: India’s multi-billion-dollar deal to buy 36 fighter
jets from France will cement strategic political ties between the two
countries at a time when both are
looking to kick-start their economies,
experts say.
Indian Prime Minister Narendra
Modi, in his first trip to France, said
last Friday he had ordered the 36
“ready-to-fly” Rafale jets as part of
a push to modernise his country’s
ageing warplane fleet.
The announcement put to rest
intense speculation over the fate of
the contract, which was first signed
in 2012 but had been bogged down
by questions of cost and New Delhi’s
insistence on assembling a portion of
the high-tech planes in India.
It also comes as Modi is seeking
to curry up interest from investors
during his maiden trip to Europe,
where he is seeking to rewrite India’s reputation as a tricky place
The Rafale fighter jet
Length: 15.27 m
Wing span: 10.80 m
Empty weight: 10 tonnes
Maximum speed: Mach 1.8 (2,170 kph)
Service ceiling: +16,700 m
Uses:
interceptions,
attacks on land and sea
targets,
nuclear strikes,
reconnaissance
Propulsion:
2 SNECMA M88-2 engines
to do business.
“Such major deals are never purely commercial, they are a part of a
larger government strategy,” Mrinal
Sumant, a retired army major general
and procurement specialist, told AFP.
“It’s a decision based on the
geopolitical and strategic interests
SINGAPORE: The investment
outlook for both equity and
fixed-income asset classes
continues to be positive, according to a report by UOB
Asset Management (UOBAM),
The Straits Times reported.
“Improving global economic growth in 2015, combined
with low inflation and supportive monetary policies,
will lead to a year of moderate performance distributed
broadly and similarly across
most regions,” it said. UOBAM
noted that there is still “very
low inflation” last Friday, with
policies such as quantitative
easing programmes being implemented across the world
to stimulate money supply
and global liquidity. — The
Straits Times
Tee International
third-quarter net profit
plunges 76.5%
SINGAPORE: Tee International, a mainboard-listed engineering and property firm, reported last week a
76.5% plunge in third quarter net profit, to S$133,000
(RM356,227), The Straits Times
reported. Revenue for the three
months to Feb 28 rose 15.5%
to S$43.1 million, from a year
earlier, owing to higher revenue for ongoing engineering projects. Cost of sales also
increased by 19.2% to S$37.3
million. Gross profit fell 3.8% to
S$5.8 million. Other operating
income fell 10.6% to S$995,000,
owing to lower interest income
from associated companies. —
The Straits Times
China super-rice grower
blames weather, fungus
for harvest failure
BEIJING: China’s super-rice
grower, Yuan Longping HighTech Agriculture Co Ltd,
blamed abnormal weather and
disease for large crop failures
in the rice growing province
of Anhui last year. Rice blast
fungus caused a reduction in
yields or no harvests in many
areas in the province, said an
executive with the company
founded by Yuan Longping,
an agricultural scientist who is
sometimes referred to by Chinese media as “the father of
hybrid rice”. — Reuters
Pakistan to raise
more than US$1b via
Habib Bank sale
Flight autonomy:
3 hours
Range: 1,850 km
Source: Dassault
‘Positive’ outlook for
equity and fixed-income
asset classes
Photo: Karim Sahib
of the two countries.”
India, which has long been the
world’s largest buyer of defence
equipment, is in the midst of a
multibillion dollar upgrade of its
Soviet-era military hardware in the
face of antagonistic neighbours Pakistan and China. — AFP
KARACHI: Pakistan will
raise more than US$1 billion
(RM3.66 billion) by selling its
entire stake in Habib Bank Limited, a government official said
on Saturday, a deal that will
be the country’s biggest privatisation so far. The government will sell its 42.5% stake in
Pakistan’s biggest bank at 168
rupees (RM6.05) per share after a successful book-building
exercise last week, Mohammad Zubair, the chairman of
the privatisation commission,
said. — Reuters
24 W O R L D B U S I N E S S
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
‘Greece’s list of reforms wanted by April 20’
FRANKFURT: The European Union
has given Greece until April 20 to present a list of reforms which, if found
acceptable, would unlock the final
tranche of aid funds promised under
a multibillion euro bailout, a German
newspaper reported yesterday.
Eurogroup ministers have set the
Greek Church
offers up
property to help
Athens raise
funds for debt
ATHENS: The head of Greece’s
Orthodox Church said on Saturday it was willing to put property
it owns up for development to
help raise money to repay the
country’s debt.
The Orthodox Church is a
powerful institution in Greece
and owns more land than anyone except the state, including
prime real estate in Athens.
“Come, let’s develop [the
property] for Greece,” Archbishop Ieronymos of Athens told
Greek TV in an interview during the Greek Orthodox Easter
holiday.
Asked if the Church would
consider selling off property,
he said: “No, I would say let’s
work together and [the state can]
use the revenues to repay all its
debts ... but the plots of land will
remain Greek, in Greek hands.”
He did not say what kinds
of business developments he
had in mind.
It is unclear how much property the Church owns as its structure is decentralised and Greece
has no central land registry.
Greece has teetered on the
verge of bankruptcy since its
debt crisis broke out in 2009 and
has depended on rescue loans
totalling €240 billion (RM930.97
billion) from the European Union and International Monetary
Fund to stay afloat.
While an integral part of Greek
society, critics say the Church
owns too many assets, pays too
little in taxes and has failed to contribute its fair share as ordinary
Greeks’ bills have soared during
the economic crisis. — Reuters
deadline in order to have sufficient
time to examine Athens’ proposal
ahead of a meeting on April 24,
the Frankfurter Allgemeine Zeitung reported, quoting unnamed
representatives in the negotiations.
Negotiators from Greece and the
EU have struggled to make head-
way over the final payout of €7.2
billion (RM27.9 billion) as Athens
has refused to consider cutting civil
servants’ pensions.
Alexis Tsipras’s government,
which was elected on an anti-austerity ticket, is reticent about accepting further cuts in public spending.
Rather, it is looking at raising national revenues through improving
tax compliance.
Last Thursday, the Greek government also began examining a draft
bill aimed at rehiring around 4,000
civil servants who were retrenched
due to austerity reforms. — AFP
New economic
order, says USDA
US will just barely remain global leader, China’s GDP to double
BY JEANNA S M I ALE K
WASHINGTON: Get ready for a new
economic order. In the world 15 years
from now, the United States will be far
less dominant, several emerging markets will catapult into prominence,
and some of the largest European
economies will be slipping behind.
That’s according to the US Department of Agriculture’s (USDA) latest
macroeconomic projections that go
out to 2030, displayed in the chart as
shown. The US will just barely remain
the global leader, with US$24.8 trillion
(RM90.77 trillion) in annual output.
The gray bar represents the US$16.8
trillion gross domestic product projected for 2015, and the green bar
shows how much bigger the economy is expected to be 15 years from
now. The country, worth 25% of the
world economy in 2006 and 23% in
2015, will see its share decline to 20%.
China’s gross domestic product
will grow to more than twice its size
today, helping the Asian powerhouse
to almost entirely close its gap with
the US
India, ranked eighth for 2015, will
climb past Brazil, the United Kingdom, France, Germany and Japan to
take third place in the world ranking. The country will have the largest workforce in the world within
the next 15 years, the International
Monetary Fund notes, and among
the youngest.
Other nations won’t be so lucky,
particularly among developed
MADRID: Royal Dutch Shell sat
out previous waves of energy consolidation. Now the Anglo-Dutch
major has struck the first mega
deal of the latest oil rout. Paying
US$70 billion (RM256.2 billion)
for smaller, gas-focused rival BG
looks like a smart and opportunistic way to boost growth.
Shell admits eyeing BG for
years. The deal looks well-timed:
a series of profit warnings and
management changes made BG
vulnerable, with new chief executive Helge Lund only taking over
in February.
At first glance, though, this
looks better value for BG shareholders. A fat 50% premium
equates to a total mark-up of
nearly US$23 billion. That outstrips planned annual savings of
US$2.5 billion: taxed at BG’s 37%
rate and capitalised at 10 times,
these would have a net present
value of closer to US$16 billion.
However, there may be plenty
of extra savings that Shell has not
Wal-Mart says Walton
family to sell shares
to keep lid on stake
BENTONVILLE (United States):
Wal-Mart Stores Inc said the
Walton family was putting 6%
of the retailer’s outstanding
shares in a newly formed trust
for possible sale to offset expected increases in its stake
due to stock buybacks and to
help fund charitable contributions. The amount of stock
set to go into the trust is worth
US$15.6 billion (RM57.1 billion) at the current price. The
Walton family, which founded
the company, owned 50.86%
of Wal-Mart’s stock as of Dec
31. In a statement, the company said it had been informed
by the family that it planned
to sell shares “from time to
time” to ensure its stake does
not increase as a result of the
company’s stock repurchase
programme, and to finance investments in charity. — Reuters
Canada’s Bombardier
looks to raise cash from
rail business — sources
economies. Japan, which was a
roaring economy until its asset bubble burst in the early 1990s, has
already slogged through decades
of stagnation and will likely continue to see very little growth over
the next 15 years. That will push
Japan down a spot in the rankings
by 2030, according to the USDA
estimates.
Japan is “an important lesson
in how quickly you can downshift
your status of what a structure of an
economy delivers,” said Bruce Kasman, JPMorgan’s chief economist.
France will slide three spots,
while Italy drops two.
In the overall ranking, Jamaica
will surrender the most ground,
bumping down 13 places to 136.
Countries with the biggest advances
— like Uganda, which will climb 18
spots to rank 91 — are concentrated
in Africa, Asia and the Middle East.
The USDA is not the only — and
hardly the most widely-followed —
ranking of global economic growth,
though it does offer the advantage
of particularly long-term outlooks.
— Bloomberg
Shell could win from bold US$70b swoop on BG
BY FI ON A MA H A RG-BRAVO
IN BRIEF
quantified yet. And BG’s depressed
share price might overstate the real
premium — the stock has plunged
28% in the last nine months.
Moreover, the strategic argument is compelling. BG will boost
Shell in two complementary areas:
Brazilian deepwater assets and liquid natural gas. Shell, which has
a lacklustre reserve replacement
ratio compared to peers, will see
production lifted by 20%.
As ever with mega deals, much
depends on execution and keeping costs down. Given BG’s recent
troubles, this may not be straightforward, although the company’s
capital commitments are falling as
it completes large projects.
There is also an in-built optimism behind Shell’s move. BG
will add to cash from operations in
2016 and will be strongly accretive
to earnings per share from 2018,
Shell says. But it is assuming that
by then Brent crude has recovered
to US$90 a barrel, some 50% higher than today’s price. If it doesn’t,
Shell will need to find a sharper
axe. — Reuters
LONDON: Bombardier Inc is
exploring a possible sale of
all or part of its railway business, which bankers value at
up to US$5 billion (RM18.3
bilion), among options to pay
for huge cost overruns in its
aircraft business, sources familiar with the matter said. The
Canadian company is working
with banks on strategic options
for its transportation arm including a possible initial public
offering , three sources said last
Friday. A merger with peers
such as Germany’s Siemens or
France’s Alstom could also be
considered, one of the sources said, pointing to a tie-up
between China’s biggest train
makers CNR and CSR Corp last
year that put pressure on rivals
to gain scale. — Reuters
Spotify said to seek
financing to value music
site at US$8b
NEW YORK: Spotify Ltd is in the
process of raising new financing that would value the largest
subscription music-streaming
service at about US$8 billion
(RM29.28 billion), according to
people familiar with the matter.
That valuation is double what
the company was worth when
it raised money in November
2013. The latest round totals
about US$400 million, according to one of the individuals,
and comes from a group that
includes Goldman Sachs Group
and an Abu Dhabi sovereign
wealth fund, the Wall Street
Journal reported last Friday.
— Bloomberg
Toyota to build plant in
China — reports
TOKYO: Toyota is planning to
build a new plant in northern
China as the world’s top automaker ramps up investment after
a two-year freeze, reports said on
Saturday. Proposals for the plant
in Tianjin should be finalised by
the summer, Jiji Press and Kyodo
News agency reported. — AFP
W O R L D 25
M O N DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY
Police: Man shoots, kills self near US Capitol
BY ST EPH EN D OCKERY
WASHINGTON: A man holding a
protest sign shot and killed himself on Saturday near the steps of
the US Capitol at the height of
tourism season in Washington,
triggering a brief lockdown of the
congressional building.
Police said the man had a “so-
Iran cannot
be trusted,
Netanyahu
warns
JERUSALEM: Israeli Prime Minister Benjamin Netanyahu kept
up his assault on the framework
nuclear deal between world
powers and Iran, warning late
Saturday that the Islamic republic could not be trusted.
It was the latest attack on the
emerging deal under which Iran
would curtail its nuclear activities in exchange for relief from
punishing economic sanctions.
Following marathon talks in
the Swiss city of Lausanne, the
negotiators agreed on a framework deal on April 2, which Israel has repeatedly denounced
as an “historic mistake”.
“To my regret, all of the
things I warned about vis-avis the framework agreement
that was put together in Lausanne are coming true before our
eyes,” Netanyahu said.
“This framework gives the
leading terrorist state in the
world a certain path to nuclear bombs,” he warned.
“How can such a country be
trusted?”
The emerging deal, which is
to be finalised by June 30, would
leave Iran with “significant nuclear capabilities,” he said.
“It is not dismantling them,
it is preserving them. We also
see that the inspection is not
serious... as of now, there is no
monitoring,” he added.
“We see that the sanctions
are being lifted, immediately,
according to Iran’s demand,
and this is without Iran having
changed its policy of aggression
everywhere.” — AFP
cial justice” protest sign with him
when he produced a weapon and
shot himself on the western side
of the building in the afternoon.
US Capitol Police chief Kim
Dine said no shots were fired by
police.
His force investigated a backpack and case the man had with
him before reopening the legisla-
tive building and its visitor centre.
Dine said the shooting was
not terrorism-related, declining
to comment further on the man’s
identity or his motive pending an
investigation.
The FBI, Secret Service and
local police are investigating the
shooting.
“We potentially know who he
is but obviously we have to secure that and verify it,” Dine said.
Washington is in the middle of
one of its peak tourism seasons
as visitors flock to view the city’s
famous cherry blossoms.
The shooting took place just
after 1.00pm (1700 GMT) and
the lockdown ended nearly three
hours later. — AFP
Obama back in
Washington
Describes meeting with Castro as ‘candid and fruitful’
PANAMA CITY: US President Barack Obama arrived home late Saturday, just hours after unprecedented face-to-face talks with Cuban
President Raul Castro and a first
meeting with Venezuelan President
Nicolas Maduro.
Obama characterised his meeting with Castro — the first sitdown
between leaders of both nations
since 1956 — as “candid and fruitful,” while the White House said
the US leader voiced support for a
peaceful dialogue between Venezuela’s government and the opposition during brief talks with Maduro.
The historic talks in Panama, on
the sidelines of the Summit of the
Americas, came after Obama and
Castro announced in December
that they would move to normalise ties between the United States
and communist Cuba after more
than a half-century of animosity.
Obama faced stinging criticism
on his return to the US capital, with
Senator Ted Cruz, a Cuban-American Republican candidate in the
2016 presidential race, accusing
him of “caving to a communist dictator in our own hemisphere”.
On another note, Obama said
Hillary Clinton would make a fine
US president, he told reporters on
Saturday, on the eve of the expected launch of her candidacy for the
Democratic Party’s nod in 2016.
SUMMERVILLE (United States):
Hundreds mourned on Saturday
at the funeral of an unarmed black
suspect gunned down in a “disgraceful” shooting by a white officer, an episode that has raised
questions about race and excessive
force in the United States.
Walter Scott, a 50-year-old father
of four, was shot five times in North
Charleston, South Carolina after fleeing a routine traffic stop while a bystander caught the event on video.
Scott’s body arrived at Word
Ministries Christian Center, where
Obama beat Clinton — who is
vying to be the first woman president of the United States — for their
party’s nomination in 2008 after a
gruelling campaign.
“She was a formidable candidate
in 2008. She was a great supporter
of mine in the general election. She
was an outstanding secretary of
state. She is my friend,” Obama said
at the regional summit in Panama.
Several US media reports, citing
sources in Clinton’s campaign team,
said the 67-year-old was to announce
her candidacy for the Democratic
nomination yesterday. — AFP
NAIROBI: One Kenyan student
died and more than 100 others
were injured after an exploding
electricity transformer caused a
stampede yesterday, in a sign of
high tensions a week after gunmen stormed another university campus, officials said. The
student who died was among
others who jumped from as
high as five floors up, fearing
the University of Nairobi’s Kikuyu campus had come under
attack, university vice-chancellor Peter Mbithi told Reuters. Gunmen from the al- Qaeda-aligned group al-Shabaab
stormed Garissa University
College, about 200km from
the Somali border, killing 148
people on April 2. — Reuters
Malta referendum
extends spring bird
hunting exception
VALLETTA: Hunters on the
Mediterranean island of Malta have won a referendum to
let them continue to hunt migrating birds in spring, a centuries-old tradition not allowed
anywhere else in the European Union. The referendum on
Saturday was called by environmentalists who wanted to
end an EU exception that allows
hunters to shoot turtle doves
and quail for 20 days between
April and May, a time when the
birds fly north to breed after
wintering in Africa. Prime Minister Joseph Muscat, who had
backed the hunters, said yesterday they had won about 51%
of the vote. — Reuters
GRENOBLE (France): A seven-year-old British boy died
when he fell from a cliff after
straying off piste in the French
Alps, emergency services said
on Saturday. The boy, who had
been on a family skiing holiday in the resort of Flaine in
France’s Haute Savoie region, is
believed to have taken a wrong
turn last Friday after asking his
mother if he could make the
last descent of the day alone.
“He fell 50 to 100 metres,” an
emergency services spokesperson said. It was not clear
whether the boy was skiing at
the time of the accident or was
on foot. — AFP
Shark kills 13-year-old
boy off island of
La Reunion
Judy Scott being escorted in for
the funeral of her son Walter at
Word Ministries Christian Center on
Saturday in Summerville.
Photo by Reuters
family, friends, politicians and law
enforcement officers gathered to
bury him.
His family declined to speak to
reporters, but their lawyer Chris
Stewart said that the family would
not “be put in corners based on
colour, based on creed.”
“Their son is going to be remembered for changing the way we look
Kenyan student dies,
more than 100 injured in
stampede
British boy, 7, killed in
French Alps skiing
accident
Hundreds mourn at funeral of black man killed by US cop
BY JI M WAT SON
IN BRIEF
at each other, because next time another side to the story,” he said.
something does happen to an inAn overflow crowd of more than
dividual, be he African American, 100 people gathered under an awnyou will now think maybe there’s ing outside in drizzling rain. — AFP
LES AIGRETTES (France): A
13-year-old boy was attacked
and killed by a shark yesterday
off the French Indian Ocean island of La Reunion, authorities
said, the seventh such deadly
attack since 2011. The shark
tore off the boy’s limbs and
part of his stomach as he was
swimming in an off-limits section of the ocean off the west
coast of the island. It was the
16th shark attack on the island
since 2011 and the seventh loss
of life. — AFP
26 WORLD
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
Russian navy evacuates over 300 from Yemen
MOSCOW: A Russian navy ship
has evacuated 308 people of various nationalities from war-torn
Yemen, a defence ministry official
said yesterday.
The evacuees were en route
to Djibouti and included 45 Russians, 18 Americans, five British nationals, 159 Yemenis and
citizens of former Soviet states
and the Middle East.
“All evacuated persons are safely on board the Russian ship which
will deliver them to Djibouti by
morning,” ministry spokesman
Igor Konashenkov told Russian
agencies.
Russia has been evacuating its
own and other citizens by air from
the capital Sanaa and by sea from
Aden since its consulate was hit
on March 29.
A coalition led by Saudi Arabia
began a push last month against the
Houthi Shiite rebels backed by Iran.
On Saturday the Russian foreign
ministry announced that it will
attempt to evacuate more people
through today, but that continuing
air strikes prevented planes from
entering Yemeni airspace.
Another attempt was to be
made yesterday, according to the
Russian embassy in Yemen.
Russian media cited a source at
the Sanaa airport as saying that the
Saudi-led coalition carrying out
the air strikes prohibited planes
from flying over the conflict-torn
country. — AFP
Bangladesh
tightens
security after
hanging of
Islamist
China orders media
giant Sina to ‘improve
censorship’
BEIJING: China’s government
has threatened to shut down
Sina, one of the country’s
most popular news websites
unless it “improves censorship”, state media reported,
in a rare public glimpse into
controls over the press. The
online portal “distorted news
facts, violated morality and
engaged in media hype”, the
official Xinhua news agency on Saturday cited the Cyberspace Administration of
China (CAC) as saying. The
CAC will “seriously” punish
Sina, with possible measures
including “a complete shut
down of its Internet news services”, Xinhua added. — AFP
Justin Timberlake
and wife Biel welcome
baby boy
BY SHA FI Q U L ALAM
DHAKA: Bangladesh tightened
security nationwide yesterday
after a senior Islamist was
hanged for war crimes during
the 1971 independence conflict, a move that triggered
anger among his opposition
supporters.
Police said extra officers
were deployed in the capital
and other major cities hours
after Mohammad Kamaruzzaman, the third most senior
leader of the Jamaat-e-Islami
party, was executed in a Dhaka
prison late on Saturday.
“We’re alert against any bid
to create anarchy or violence,”
a police spokesman told AFP,
saying police and paramilitary officers were patrolling
key places to prevent his supporters rallying.
Kamaruzzaman was convicted in 2013 by a controversial war crimes tribunal of
carrying out a massacre in a
village as head of a pro-Pakistan militia.
Jamaat, the largest Islamist
party, called a nationwide
“prayer day” for yesterday
and a strike today in protest
at Kamaruzzaman’s “heinous
killing”. The party branded it
an act of “revenge and preplanned murder” by the secular government.
The 62-year-old’s hanging is
expected to deepen a monthslong political crisis that has
seen the Islamists and the
main opposition party launch
nationwide protests to try to
topple Prime Minister Sheikh
Hasina.
But the execution is unlikely
to trigger the widespread deadly violence that was unleashed
after the only other execution
for wartime atrocities, also of
an Islamist, was carried out
in 2013.
Hundreds of Jamaat activists
were killed that year when the
party held a series of nationwide protests against trials of its
leaders by the tribunal, which
was established by Hasina’s
government.
Security forces have since
rounded up thousands of Jamaat supporters in a massive
crackdown on the unrest. — AFP
IN BRIEF
People standing on the rubble of a house
destroyed by an air strike, in Amran
province, northwest of Yemen’s capital
Sanaa yesterday. Photo by Reuters
Coalition air strike,
clashes kill 27 in Yemen
As fighting flares in 15 of the country’s 22 provinces
SANAA: A Saudi-led air strike hit
a base in central Yemen killing 15
rebels yesterday as 12 people died
in overnight fighting in main southern city Aden, medical and security
sources said.
The predawn strike hit Camp 22
in al-Dhahra in the south of Taez
province and also wounded eight
Houthi Shiite rebels or allied troops,
a medic at al-Thawra hospital said.
The base belongs to the elite Republican Guard which remained loyal to former president Ali Abdullah
Saleh after he was forced from power
in 2012 following a year of nationwide
protests against his three-decade rule.
Saleh has allied his followers with
the Houthi rebels, who overran the
capital Sanaa in September, in their
battle against forces loyal to fugitive
President Abedrabbo Mansour Hadi.
The Saudi-led coalition said on
Saturday that it had conducted 1,200
air strikes since March 26 and neutralised the air and missile capabilities of the rebels and their allies.
The air campaign, which has
been accompanied by a naval blockade, was launched as the rebels
closed in on Hadi’s refuge in Aden.
The president escaped to neighbouring Saudi Arabia as the rebels
and their allies entered the port
city sparking fierce fighting with
his loyalists.
Four civilians were shot dead
in the city’s Mualla and Dar Saad
districts on Saturday, a medic at the
Ba-Suhaib military hospital said.
A Hadi loyalist blamed rebel
snipers for the deaths.
In the west of Aden, five rebels
and three loyalist militiamen were
killed in clashes that flared as the
rebels tried to advance towards the
city’s oil refinery, sources on both
sides said.
Since the air campaign began,
fighting has flared in 15 of Yemen’s
22 provinces.
These include Aden, Daleh, Lahj,
Abyan and Shabwa in the formerly
independent south, where locally
recruited militia have remained
loyal to Hadi.
Taez, Ibb, Baida, Hudeida, Raymah, Amran, Hajja, Saada, Jawf and
Marib have seen clashes between
the rebels and tribes loyal to Hadi, or
with Saudi troops across the border.
Meanwhile, al-Qaeda militants
have taken advantage of the security
vacuum to seize control of Mukalla,
the capital of Hadramawt province
in the southeast. — AFP
Two dead in attack on S Korea embassy in Libya
SEOUL: Unidentified gunmen attacked South Korea’s embassy in the
Libyan capital Tripoli yesterday and
killed two security guards, Seoul’s
foreign ministry said.
The group fired dozens of rounds at
the embassy compound from a passing vehicle, leaving two Libyan guards
dead and another injured, it said.
Three South Koreans working
in the embassy — including two
diplomats — were unhurt, a ministry official told AFP on condition
of anonymity.
“We do not know whether the
attack targeted the embassy or the
Libyan [security] officers,” the official said, adding the ministry was
considering evacuating all its staffers from the country.
Militias which fought to topple
Moamer Kadhafi’s regime in 2011
often carry out kidnappings or attacks targeting foreign diplomats
in the Libyan capital.
The country has been awash
with weapons since the end of the
uprising that killed Kadhafi and
has been gripped by increasing
lawlessness. — AFP
LOS ANGELES: Singer Justin
Timberlake and his actress
wife Jessica Biel welcomed
their first child into the world
on Saturday, a boy named Silas Randall. Timberlake, 34,
was “ecstatic”, People magazine said, adding that mother and baby were doing well.
“My amazing son and his
beautiful wife have given us
the most precious gift in the
world!” Timberlake’s mother,
Lynn Harless, wrote on Facebook. “Silas Randall Timberlake! Named after my father
and my son! Life is beautiful and we couldn’t be happier! God bless you all and
thanks for all the congrats!”
— AFP
Police: Woman left
quadriplegic son in
woods in Philadelphia
PHILADELPHIA: A mother
abandoned her quadriplegic son in a wooded area of a
Philadelphia park for nearly
a week so she could visit her
boyfriend in Maryland, police
said. The 21-year-old disabled
man was found by a passer-by
at night last Friday lying on
leaves and covered by blankets with his wheelchair and
Bible nearby, said Philadelphia police Lieutenant John
Walker. Police said the man
who was abandoned in the
woods is unable to talk and
suffers from cerebral palsy.
— Reuters
Death sentences for
Brotherhood head
and 13 others
CAIRO: A Cairo court on Saturday confirmed death sentences for Muslim Brotherhood leader Mohamed Badie
and 13 others over Islamist
protest violence, while the
jailing of a US-Egyptian citizen for life was slammed by
the White House. Two of the
14 defendants sentenced to
death have fled the country
and will immediately face a
retrial if apprehended. Judge
Mohamed Nagy Shehata also
handed life terms to 23 detained defendants. — AFP
W O R L D 27
M O N DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY
NPC member: China
to curb Hong Kong visits
Will restrict residents to one per week from unlimited number of daily trips
BY JAMES POMFRET
& M I C H EL L E C H EN
HONG KONG: China will limit visits by residents of the city of Shenzhen to neighbouring Hong Kong,
a politician and media said yesterday, following recent tension in the
former British colony over growing
numbers of mainland visitors.
Hong Kong has seen a groundswell of discontent over the number of mainland Chinese visiting
Pope describes
Armenians’
mass murder as
‘genocide’
the crowded city where frustration
with what many residents see as attempts by Beijing to restrict democracy erupted in protests last year.
Shenzhen authorities would
soon restrict residents to one Hong
Kong visit a week, from an unlimited number of daily trips, said Michael Tien, a Hong Kong member
of China’s parliament, the National
People’s Congress (NPC).
“It will definitely happen,” Tien
told Reuters. “I’ve heard from very
reliable government sources.”
Hong Kong returned to Chinese
rule in 1997 under a “one country, two systems” formula that ensured it autonomy. Visitors from the
mainland need permission to visit.
Media said the curbs could come
into effect as early as today. Shenzhen is just a short train ride from
Hong Kong.
On the website where residents
of Shenzhen apply for Hong Kong
visas, the option for multiple visits
a year could not be selected yesterday.
There was no immediate response or confirmation from the
Shenzhen government.
The Hong Kong government said
any announcement would come
from mainland authorities. But it
acknowledged, in a statement, that
it had proposed concrete measures
to adjust visas that allow Shenzhen
residents multiple entries to Hong
Kong. — Reuters
Poles apart? Dancers say their
performance is sporting not sexy
BY TOM HANCO C K
BY EL L A I D E
VATICAN CITY: Pope Francis used the word “genocide”
yesterday to describe the 1915
mass murder of Armenians in
a move likely to severely strain
diplomatic ties with Turkey.
“In the past century, our human family has lived through
three massive and unprecedented tragedies,” he said during a
solemn mass in Saint Peter’s Basilica to mark the centenary of the
Ottoman killings of Armenians.
“The first, which is widely considered ‘the first genocide of the 20th century’, struck
your own Armenian people,”
he said, quoting a statement
signed by Pope John Paul II
and the Armenian patriarch
in 2001. — AFP
BEIJING: Erotic display or serious
sport? At the World Pole Dancing
Championships finals in Beijing yesterday, competitors in skintight suits
insisted that their challenging discipline deserves Olympic recognition.
The limber and lithe contestants from more than 10 countries
on four continents hope they can
shed the sport’s association with
seedy strip clubs and win respect
as skilled athletes.
“Pole dancing requires technical
content as much as gymnastics and
acrobatics, and the level of difficulty is higher,” Ke Hong, a member
of the Chinese team — one of the
strongest in the sport — told AFP
ahead of the competition.
He is one of over 50 contenders
including more than a dozen men
at the championships. They force
IN BRIEF
Australia to deny benefits
to parents refusing to
vaccinate children
SYDNEY: Australian Prime
Minister Tony Abbott said yesterday his nation will adopt
a “no jab, no pay” policy to
block parents who refuse to
vaccinate their children from
accessing some government
benefits. The policy change
comes amid a debate over
immunisation for children,
with some parents believing vaccines against deadly
diseases are dangerous. The
anti-vaccination movement
has coincided with the resurgence of measles, a preventable disease, in some European countries as well as in
parts of the United States.
China to ‘blacklist’ its
unruly tourists — report
BEIJING: China will create
a “blacklist” of its tourists
who behave badly overseas,
state-media reported, after several embarrassing
incidents involving Chinese travelling abroad. The
country’s National Tourism
Administration will keep a
database of travellers who
commit offences, with their
names passed onto police,
customs officials and even
banks, the official Xinhua
news agency reported Saturday. — AFP
Security officials: Five
Egyptian soldiers killed
in Sinai bombing
A competitor warming up before the semi-finals of the 2015 World Pole Dance
Championships in Tianjin on Saturday. Photo by AFP
themselves onto the pole for as many
as eight hours a day to perfect their
gravity-defying spins and poses.
“It hurts every day,” he added.
“The very first week, I thought about
giving up.”
The scale of the competition
reflects the growing appeal of pole
dancing as a fitness aid over the last
decade — with thousands of clubs
estimated to have opened worldwide, including more than 500 in
the United States alone.
Competitors making the journey
to China this year include the British
current World champions ‘Bendy’
Kate Czepulkowski and Sam Willis,
the event’s organisers said. — AFP
CAIRO: Five Egyptian soldiers
were killed and three others
wounded in a bomb attack
on their armoured vehicle
in the Sinai region yesterday,
security officials said. Security officials said the roadside
bomb was planted in an area
of the northern Sinai peninsula that is a stronghold of
Ansar Beit al-Maqdis, which
has pledged allegiance to the
Islamic State group.— AFP
28
live it!
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
MO
WELLBEING . THE ARTS . WINE+DINE . STYLE+DESIGN . LEISURE
Personal
ASSISTANT
COMPI L ED BY S U ANN QUAH
WORK. LIFE. BALANCE
LEARN about the colourful history of
Kuala Lumpur in a play presented by
the Kuala Lumpur City Hall. Set in 1880
against a flourishing tin mining industry,
MUD: Our Story of Kuala Lumpur is the
tale of three friends trying to make it big in
the city despite their cultural differences.
The play is a wonderful mosaic of stories
and personalities that make up the
building blocks of what KL is made of
today. Directed by Tiara Jacquelina and
Amsalan Doraisingam, written by Ghafir
Akbar and Chedd Eddie Yusoff, MUD is
a must-watch play for both Malaysians
and foreigners wanting to learn more
about the history of Kuala Lumpur. The
play is currently showing at Panggung
Bandaraya, Jalan Raja, Kuala Lumpur.
Showtime is 3pm and 8.30pm daily and
tickets are priced at RM60 and RM45 (with
MyKad), and can be purchased over the
counter at the Panggung Bandaraya Box
Office, Jalan Raja, 50350 Kuala Lumpur.
gum
tab
som
wo
bet
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ten
Money vs
MORALITY
A local production of David Mamet’s Speed The Plow tackles the
proverbial chasm between art and commercial gain
BY ANANDHI G O P I NATH
S
THERE is nothing like indulging in a
hearty homemade pie and basking in
its glorious aroma of beef, seafood,
chicken and mushroom. Head over to
traditional English-styled Bentley’s Pub
at Intercontinental Hotel KL where they
will be serving pies and tarts baked fresh
daily for lunch and dinner all through
the month. Savour delicious peppered
Angus beef and onion pie, seafood pot pie,
chicken and mushroom pie, as well as their
vegetarian option of curry and sweet potato
pie, all priced from RM26. These pies are
served from 12pm to midnight at Bentley’s
Pub, Intercontinental Hotel, 165 Jalan
Ampang, Kuala Lumpur. For reservations or
inquiries, call (03) 2782 6268.
econds after walking into Pentas 2 and taking my seat, I already knew I was going to like
Speed The Plow. Apart from
the refreshing and simply delightful menu of 50s music
playing in the background, the set that
greeted the audience was remarkable
— realistic and detailed; it was in complete defiance of the bare and Spartan
styles favoured by a lot of contemporary
theatre these days.
Written by American playwright David
Mamet, Speed the Plow’s plot follows two
movie executives as they discover that a
famous Hollywood star may be willing
to headline their new project, despite
usually being attached to a rival studio.
Flushed with the glow of looming success, Bobby Gould (who has just been
promoted) and Charlie Fox make a bet
over which one of them will score with
the attractive new temporary secretary
who has begun working in the office.
However, it turns out that the young
woman in question, Karen, has her own
idealistic views of what works in Holly-
wood, not to mention a determination
and willingness to do whatever it takes
to get her own way.
As I was early, I had a chance to absorb some of the more minute details of
the set — an Oscar statue taking pride
of place in one corner, furniture covered with a plastic covering to protect
it from the dust from new renovations,
movie posters on the floor waiting to be
framed. I couldn’t be completely sure
from where I was sitting, but it did look
like the framed photograph on a side
table was of the Dalai Lama and Gavin
Yap, who plays Bob — something that reaffirmed the newly promoted producer’s
brash personality.
The overall effect is of a gritty movie
producer’s office in the 1960s, in a time
when men could smoke cigarettes indoors and women wore pretty clothes and
answered phones. The play was written
in 1988, when the subject of women’s
rights and representation was still blurry,
which reflects the way Mamet addresses
the subject as well — I can’t be sure if the
misogyny expressed by the characters is
meant to criticise misogyny itself or is a
direct reflection of the author’s own is-
sues with women.
Speed The Plow begins with Bob striding on stage, delivering an opening soliloquy that is a reminder of what a good
actor he is and how well he throws himself
into a role — he is a glib, overly confident,
slightly sleazy and terribly intense movie
producer. Charlie, played by comedian
and actor Douglas Lim, is jumpy, nervous, more effusive and slightly less refined than his friend Bobby.
Within minutes, the intensity of the
play and the incredible chemistry between Yap and Lim becomes evident.
Although Yap is the much stronger actor,
Lim gets increasingly into the role as the
play progresses and does a wonderful job
of making Charlie’s character extremely
likable — you can’t help but warm to his
passionate intensity and ability to see
through Karen’s pretensions.
Amelia Henderson does a remarkable
job of playing Karen, and the build-up
from ditzy secretary to smart and sassy
manipulating femme fatale was a joy to
watch. As she is handed a book that Bobby says is a courtesy read and will never
make a good movie, she later comes to
his home and presents a compelling ar-
the
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etple
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live it! 29
M O N DAY A PR I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY
WELLBEING . THE ARTS . WINE+DINE . STYLE+DESIGN . LEISURE
The final showdown between Karen (Amelia Henderson),
Charlie Fox (Douglas Lim) and Bobby Gould (Gavin Yap).
TELEVISION & MEDIA
CO MPIL E D BY S U A N N Q UA H
Bringing definition to the next level
idsood
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ent,
vie
ian
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bent.
tor,
the
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ely
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obver
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ar-
gument why he should reject the offer already on the
table for this one, and of course, have her involved
somehow. As flawlessly as she delivered her lines, it
would have been nice to see a little more chemistry
between her and Yap — Karen and Bobby do spend
the night, after all and there was very little sexual
tension to allude to that fact.
The next day, Bobby and Charlie battle it out as
they decide which movie should be the one that will
be made. The ensuing duel is hilarious as Bobby waxes lyrical about what he now believes in because of
Karen’s influence, and Charlie puts it in context by
saying “Hey, I believe in the Yellow Pages, Bob, but
I don’t want to film it.”
Mamet’s text needs actors who can make his very
musical, percussive dialogue crackle as it should in
order to unleash the full, abrasive force required. To
that end, Loosley has cast the play brilliantly as the
three actors have internalised the text very well and
their delivery doesn’t seem rehearsed at all — and
that’s quite a remarkable feat.
Speed The Plow is very fast-paced and it can almost be an effort keep abreast of what is going on —
whether that’s what Mamet intended or something
Loosley crafted is not clear. The actors speak in rapid succession and the storyline moves very quickly,
and as a result the ending is not as climactic as I had
hoped. However, the play is notably short and when
the actors make their final bow, you’re left feeling
like you really want a little more.
Mamet meant for Speed The Plow to be a satirical
take on the clash between art and commerce in the
movie world — do you talk down to the audience
or try and enrich them? Do you treat them like ticket-buying minions or like intelligent thinking people? Is money or morality the priority? To that end,
the text itself doesn’t address this very well — the
stronger message is how easily your decisions can
be reversed, and what it sometimes takes to get you
back on track.
Watch Speed The Plow not for its aim to discuss
the money versus morality argument, as Mamet
hasn’t done a very remarkable job in highlighting
it. This play is worth a watch for the effort that has
gone into its production and the way it has put some
truly brilliant acting and directing on stage. Gritty,
real and totally in your face.
Speed The Plow is playing till April 15 at Pentas 2, KLPac, Jalan Strachan, KL. Tickets are priced at RM68;
call (03) 4047 9000 or visit www.ticketpro.com.my
to purchase.
OUT with the old “High Definition”,
and in with the brand new “Ultra High
Definition” (UHD). As if watching
movies and TV shows in HD isn’t good
enough, we can now watch them in
UHD, featured in Samsung’s newly
unveiled SUHD TV. Designed to elevate our viewing experiences, this
television features a SUHD remastering engine which optimises all
content being played to match the
colour and brightness for the SUHD
TV, and a stylish curved design for a
more immersive viewing experience.
See more and feel more with
the TV’s stunning contrast, striking
brightness and spectacular colour
packed into its UHD detail. Samsung
has managed to achieve this through
the use of nano-crystal technology
that transmits a spectrum of colours
depending on their size, and subsequently produces the highest colour
purity and light efficiency available
in the market today.
Ever looking towards the future,
Samsung has also partnered with
leaders in the filmmaking industry to promote and secure a steady
growth of comprehensive UHD ecosystems. In order to establish premium UHD quality standards, they
have announced the UHD alliance
PICK OF THE DAY
WITH the release of Samsung’s newest addition to their flagship
Galaxy line, Montblanc has released a collection of fine leather
covers for the brand new Samsung Galaxy S6. This new collection
is the latest iteration of Montblanc’s partnership with the global
leader in mobile technology, following the introduction of the
first ever Montblanc ScreenWriters last year. The Pix and the eStarWalker, electronic writing instruments with their inventive
e-refill concept were created for the Galaxy Note line in addition
to a new generation of smart leather covers encapsulating an ID
chip allowing their owners to access exclusive Montblanc digital content. This year, Montblanc presents a hard shell cover
and a flip side cover, available in black soft grain leather and
Montblanc extreme leather which is renowned for withstanding
the toughest conditions. The Montblanc soft grain & extreme
leather flip covers (S6) are priced at RM750, the softgrain & extreme leather hard-shell covers (S6) at RM410, the Montblanc
extreme leather hard-shell cover (S6 Edge) at RM430 and the
Montblanc leather flip cover (S6 Edge) at RM815.
— a coalition of companies united to
set the bar for next generation video
entertainment. Amongst the things
that they are currently working on are
innovations in video technologies,
higher resolutions, higher dynamic range, a wider colour gamut and
immersive 3D audio.
In addition to the technological
advances that Samsung has managed
to cram into these new television
sets, it has also designed them to
be modern and minimalist — styles
that are in trend today. Mounted on
a wall, the SUHD sets are intended
to replicate the look of an art piece
instead of a piece of equipment.
The Samsung SUHD TVs come in
three series: the JS9500, JS9000 and
the JS8000 which range from 55 to
58 inches in length. The retail prices
for each are: RM39,999, RM24,999
and RM9999 respectively, inclusive
of 6% GST.
30
live it!
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
WELLBEING . THE ARTS . WINE+DINE . STYLE+DESIGN . LEISURE
Zen TODAY
We cannot solve our problems with the same thinking
we used when we created them. — Albert Einstein
CANNES
this year
Speculations over who’s going to be walking on the
Red Carpet at the French Riviera next month
W
ith the Cannes Film Festival set to open in just
over a month’s time,
speculation is swirling over which films
— and which top directors and actors — could be getting their
moment under the French Riviera sun.
Woody Allen is seen as more than likely to
be walking the red carpet with his new flick,
Irrational Man, starring Joaquin Phoenix.
Cate Blanchett might also be along for
her movie Carol. And fellow Oscar-winner
Matthew McConaughey could appear for
The Sea of Trees the latest film by director
Gus Van Sant, which also stars Naomi Watts.
Cannes’ organisers jealously guard their
selections for the competition line-up and
the out-of-competition programme until a
month before the film fest opens.
This year, the movies to be shown at
Cannes will be announced on April 16, and
the festival will run from May 13 to 24.
A cocktail of cinema
The organisers have a dizzying task in choosing which movies make the cut, wading
through some 1,800 films to winnow them
down to short lists.
The director of the festival, Thierry Fremaux, said last week that “there is no more
than a third of the selection definitively
decided”.
He added that he and his selection committee “watch the movies right to the end”.
Cannes mixes international arthouse cinema, Hollywood blockbusters, extravagant
parties, industry wheeling and dealing, and
eye-catching publicity stunts in a potent
cocktail that has made it the pre-eminent
global showcase for movies.
So far the only movie confirmed to be
screened is Mad Max: Fury Road. The dystopian sci-fi movie, the fourth in the high-action Mad Max franchise and the first to star
British actor Tom Hardy in the title role, will
be shown out of competition on May 14 just
before its worldwide release.
Fury Road co-stars Charlize Theron, who
is expected to saunter up the red-carpeted
steps. She could put on another dress and
put in another appearance for The Last Face,
a film she is in that is directed by Sean Penn
and also stars Javier Bardem.
Harry Potter actress Emma Watson and
Boyhood star Ethan Hawke might be along
if Regression, by Spanish director Alejandro
Amenabar (who made The Others, The Sea
Inside) is selected.
Then there’s Colin Farrell and Rachel
Weisz in the The Lobster, a sci-fi tale financed
with Irish money and directed by Greece’s
Yorgos Lanthimos. Or Jesse Eisenberg, Gabriel Byrne and Isabelle Huppert in Louder Than Bombs by Norwegian filmmaker
Joachim Trier.
A filepic of Fremaux holding an umbrella as he stands on the red carpet at the 2014 Cannes Film Festival. He
said last week that ‘there is no more than a third of the selection definitively decided’ for this year. Photo by
Reuters
Asia anticipation
Italy’s flag could flutter over Mia Madre, the
most recent picture by Nanni Moretti who
won Cannes’ top prize the Palme d’Or in
2001, or maybe La Giovinezza by Paolo Sorrentino, whose Grande Bellezza (The Great
Beauty) won a foreign picture Oscar last year.
Asia, as always, is expected to be well represented.
Thailand’s Apichatpong Weerasethakul
has just completed a romance, Love in Khon
Kaen, which might screen. Taiwan’s Hou
Hsiao-hsien, a competition veteran, has a
good chance with martial arts picture The
Assassin.
Finally, of course, Cannes always has a
soft spot for French productions.
While directors Jacques Audiard or Arnaud Desplechin might screen their latest
films, much attention is being thrown on The
Little Prince, a big-budget French animation
directed by US filmmaker Mark Osborne
that adapts the famous novel by Antoine de
Saint-Exupery. — AFP
S P O RT S 3 1
M ON DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY
Formula One: Rosberg
slams Hamilton’s tactics
Fragile truce between feuding Mercedes drivers unravelling fast
BY A L A STA I R H I MME R
SHANGHAI: Nico Rosberg accused
Lewis Hamilton of putting himself
before the team yesterday as the
fragile truce between the feuding
Mercedes rivals unravelled spectacularly in China.
World champion Hamilton won
from pole for a record fourth victory
at Shanghai but Rosberg ripped into
the Briton after the race, accusing
Hamilton of deliberately holding
him up as Sebastian Vettel’s Ferrari closed in.
“He compromised my race,”
fumed Rosberg, who finished second after demanding over the radio that Hamilton be ordered to
speed up. “By driving slower than
was necessary at the beginning of
stints meant Sebastian was very
close to me.”
Hamilton rejected Rosberg’s
claims after dominating from start
to finish.
Hamilton (right) celebrating his victory in front of team mate driver Rosberg after the
Chinese F1 Grand Prix. Photo by Reuters
“It’s not my job to look after
Nico’s race,” he shrugged. “My
job is to control my race. I didn’t
do anything intentionally to slow
any of the cars up. I just focused
on myself.”
Rosberg angrily fired back: “It’s
now interesting to hear from you,
Lewis, that you were just thinking
about yourself.”
Niki Lauda, the Mercedes team’s
non-executive chairman, did not
share Rosberg’s view that Hamilton had driven selfishly.
“These guys are egocentric people,” he said. “This is the only way to
win — they’re all the same. Lewis
was better this weekend.”
“Lewis had pole position and
controlled the race from the beginning to the end,” he added. “There’s
nothing more to say. Therefore, I
think there’s no need to quarrel.”
The pair, whose rivalry dates
back to karting as teenagers, bickered constantly last season. An ugly
public spat boiled over when Rosberg drove into Hamilton in Belgium, for which the German was
disciplined by Mercedes.
Signs of friction had already reemerged this season, with Rosberg
forced to deny suggestions he deliberately slowed Hamilton by getting in his way during qualifying in
Malaysia two weeks ago.
Asked if he wanted to respond
to Rosberg’s charge, Hamilton
laughed “not really”, before repeating: “My job is to manage the car
and bring the car home as healthy
and fast as possible.” — AFP
Khairy hopes for good outcome for Chong Wei
KUCHING: Youth and Sports Minister Khairy Jamaluddin yesterday
expressed hope that there will be a
good outcome for Malaysian badminton ace Datuk Lee Chong Wei’s
doping case.
“He (Chong Wei) called me after the hearing and told me that
the Badminton World Federation
(BWF) had given him and his lawyers the opportunity to explain.
“Chong Wei also said that he
was satisfied with the procedure
throughout the hearing.
“We have done our best. We have
prepared well for the case and I
think Chong Wei’s lawyers, led by
Mike Morgan, have presented the
Spieth stumbles but stays in
front at Masters
BY JI M SL ATER
AUGUSTA: Jordan Spieth stumbled under the weight of leading
the Masters, but salvaged par with
a clutch closing 10-foot putt to set
a 54-hole record and maintain a
four-stroke lead.
The 21-year-old Texan’s dramatic finish to a two-under par
70 third round on Saturday at
Augusta National gave him a 54hole Masters record of 16-under
200 and partly eased the sting of
a double bogey at 17.
“It was really big. It was huge.
It was one of the bigger putts I’ve
ever hit,” Spieth said. “I was very
frustrated.”
Speith, who settled for second
last year in his Masters debut after
leading on the front nine yesterday, made four birdies in five holes
to reach 18-under and led by six
with two holes to play.
But a poor tee shot led to his
setback at 17 and an approach
well right of the green at 18 forced
an aggressive chip that Spieth admitted would likely fail four times
out of five.
“It was huge just to see one go
in after the disappointment there
on 17, where I probably should
have just hit 3-wood off the tee,”
Spieth said.
Spieth, who set a 36-hole Masters record of 14-under 130, lost
only one stroke off his halfway
lead, but finds 2013 US Open winner Justin Rose alongside him in
the final pairing after a closing run
of five birdies in six holes and fivetime major winner Phil Mickelson
only five shots back after matching
Rose with a 67 Saturday.
“They are going to bring their
game and I’ve got to have a relatively stress-free round going, I
mean give myself some tap-in pars
and not have to make so many
putts,” Spieth said. — AFP
best defence possible for him.
“All we could do now is to wait for
the outcome of the hearing,” Khairy
told reporters after the launch of Fit
Malaysia by Sarawak Chief Minister
Tan Sri Adenan Satem at Padang
Merdeka yesterday.
It was reported that the hearing
process lasted about eight hours in
Amsterdam on Saturday and the
verdict is expected within three
weeks.
Chong Wei, 32, was temporarily
suspended by the BWF after he was
tested positive for dexamethasone
at the World Championships in
Copenhagen, in August last year.
— Bernama
Grand National glory for
Many Clouds
BY I AN C HADBAND
LIVERPOOL: Jockey Leighton Aspell and owner Trevor Hemmings
celebrated Grand National history on Saturday as the Oliver Sherwood-trained Many Clouds courageously triumphed in the 168th
edition of Aintree’s famous steeplechase.
Aspell could hardly believe it as he
became the first jockey for 61 years to
win the National on different horses
in two successive years following his
victory on Pineau De Re last year.
The 79-year-old Hemmings, one of
Britain’s biggest leisure tycoons and
owner of Preston North End Football Club, was equally astonished
as Many Clouds became his third
different National winner, equalling
a century-old record.
The 25-1 shot took up the running
with four fences remaining but horse
and jockey had to dig deep to hold
off runner-up Saint Are (25-1) as they
prevailed by one-and-three-quarter
lengths after nearly four and a half
miles of racing.
There was to be no fairytale farewell for the sport’s greatest jockey
Tony McCoy in his record 20th and
final ride in the race before his retirement when, following a promising outing on Shutthefrontdoor,
he faded from second to fifth after
the final fence.
Aspell’s story had its own touch
of fantasy as the 38-year-old, who
retired in 2007 only to come back 18
months later when it dawned how
much he missed it, became the first
jockey since Red Rum’s pilot Brian
Fletcher in 1974 to win two years
in a row.
He was also the first since Bryan
Marshall in 1953 on Early Mist and
1954 on Royal Tan to triumph in consecutive years on different horses.
Hemmings, owner of Hedgehunter (2005) and Ballabriggs (2011), became the first owner since Charles
Assheton-Smith in 1913 to win with
three different horses. — Reuters
IN BRIEF
Drive M7 SIC team suffer
technical glitch in Moto3
qualifying
KUALA LUMPUR: Unfortunate
circumstances hampered the
Drive M7 Racing team in the
qualifying session of the Red
Bull US Motorcycle Grand Prix
held at the Circuit of Americas, Texas, on Saturday. Malaysian Moto3 rider Zulfahmi
Khairuddin looked set to claim
a top 15 grid position when an
unfortunate technical issue
caused a premature end to
his session. The 23-year-old
rider met the chequered flag
in 28th place after speeding to
a best lap of 2 minutes 17.941
seconds, 2.597 behind Danny
Kent of Leopard Racing team
who secured pole position
with a time of 2:15.344s. —
Bernama
Hafizh Syahrin qualifies at
15th position in Moto2 race
KUALA LUMPUR: Malaysian
Moto2 rider Hafizh Syahrin Abdullah has done a great job to
qualify at 15th position despite
riding alone on track in the Red
Bull US Motorcycle Grand Prix
held at the Circuit of Americas,
Texas, on Saturday. The Petronas Raceline rider worked extra
hard alone on the track without
any tow from the faster riders to
clock his best lap of 2 minutes
10.894 seconds, 1.006 seconds
off poleman, Xavier Simeon
from Federal Oil Gresini Moto2
team. The Belgium rider secured the pole with a new lap
record of 2:09.888s in lap 16.
— Bernama
Button handed time penalty
for Maldonado’s collision
SHANGHAI: McLaren’s Jenson
Button was handed a time penalty that cost him 13th place in
yesterday’s Chinese Grand Prix
after accepting responsibility
for a collision with Lotus driver
Pastor Maldonado. The 2009
Formula One world champion,
who dropped to 14th as a result
of the extra five seconds added
to his time, also picked up two
penalty points for the turn one
collision. “I thought there was
room on the inside,” the Briton
said of the incident that led to
Maldonado’s retirement for the
third race in a row. “Just a misjudgement, I guess.” — Reuters
Najib congratulates
1Malaysia Cup champions
KUALA LUMPUR: Prime Minister Datuk Seri Najib Tun Razak
congratulated Ipoh Friday’s
Football Club for winning the
1Malaysia Cup yesterday. “I
hope this win will be spur them
to success as professional players and [they] will benefit from
the Real Madrid Foundation
Campus Experience,” he said
in his Facebook page yesterday. The 1Malaysia Cup football
tournament was organised to
promote the development of
local football players and to
turn them into professional
players. — Bernama
3 2 S P O RT S
M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY
City’s season in ‘the
garbage’, says Pellegrini
Ahead of Manchester derby at Old Trafford
LONDON: Manchester City manager Manuel Pellegrini delivered a
damning verdict on his club’s season ahead of the Manchester derby
at Old Trafford yesterday, saying
they had thrown their campaign
“into the garbage”.
Since the turn of the year, reigning Premier League champions City
Hamburg
players fight at
half-time
BERLIN: Relegation-threatened Hamburg confirmed yesterday that their players came
to half-time blows during their
latest defeat amid jokes that
even Cristiano Ronaldo could
not help the Bundesliga strugglers avoid a historic drop.
Their 2-0 home defeat to
Wolfsburg on Saturday left
Hamburg 17th in the table and
four points from safety with six
games left.
They finished with 10 men
after Swiss defender Johan
Djourou was sent off late for
a second yellow card against
Wolfsburg.
Hamburg’s media director
confirmed reports that Djourou
and midfielder Valon Behrami
came to blows in the Hamburg
dressing room during the halftime break.
“It’s true, there was an incident and those involved will be
fined,” Hamburg’s Joern Wolf
told SID, an AFP subsidiary.
Hamburg have failed to
score in the last 494 minutes
of Bundesliga football and
have netted just 16 times in
their 28 league games this season, leading to jokes even Real
Madrid goal-machine Ronaldo could not save them from
relegation.
“My brother said that even
Cristiano Ronaldo could come
— and he wouldn’t be able to
help either,” quipped Hamburg’s Croatia striker Ivica Olic.
Olic rejoined Hamburg from
Wolfsburg in January’s winter
break, but is still waiting for
his first goal since his return.
Hamburg have lost 15
games, the most in the Bundesliga this season.
They are the only team in
Germany’s top flight to have
never been relegated but a historic drop to the second division looks imminent having
stayed up last season only after winning a two-legged play
off. — AFP
have been eliminated from both the
FA Cup and the Champions League.
Meanwhile, their hopes of retaining the English top-flight title have all
but scuppered by losses to the likes of
Arsenal, Liverpool and, more damningly, Burnley and Crystal Palace.
Now they will kick off away to
Manchester United in fourth place
— a point behind their local rivals
and at least nine adrift of table-toppers Chelsea, who faced strugglers
QPR earlier yesterday.
“It has not been a good season,”
Pellegrini, quoted in several British newspapers, said yesterday.
“It was not so bad until the end of
2014, when we were top of the ta-
ble and also had the FA Cup and
Champions League.
“But in the last three months we
have thrown it into the garbage,”
the under-pressure Chilean added.
“I think always for the fans it is
important to finish as near to the
top of the table as you can and that’s
what we must do.” — AFP
‘Perfect run’ only way for
Arsenal to win title, says Wenger
BY JAMES MCMATH
BURNLEY: Arsene Wenger has
said his Arsenal side need a “perfect run” to have any chance of
catching Premier League leaders
Chelsea.
Saturday’s 1-0 win away to
Burnley made it eight league wins
in a row for the Gunners for the
first time since the ‘Invincibles’
season of 2003/04.
Chelsea were four points in
front with two games in hand
ahead of their match away to relegation-threatened Queens Park
Rangers yesterday and the title is
now theirs to lose.
But London rivals Arsenal have
emerged as their closest challenges due to a superb run of form.
However, cautious Arsenal manager Wenger said after
his side’s latest triumph at Turf
Moor, “Nothing has changed, we
need a perfect run and we need a
non-perfect run from them (Chelsea) but we can’t master that, we
can only master our own position.”
“We want to keep winning because we have to look behind
us as well at Manchester United
and Manchester City,” the veteran
French boss added.
“I think we have won 15 of last
17 so we are consistent.”
“When you look at the number
of players we had out for months
at the start of the season, we got
our squad back since January and
that makes a difference.”
“Let’s focus on the next game
and give absolutely everything
to finish in a strong way.”
Aaron Ramsey’s ninth club
goal of the season was enough
to give Arsenal maximum
points against a determined
Burnley team, who missed the
chance to move out of the relegation zone.
Burnley have taken points off
Manchester City, Chelsea and Tottenham Hotspur this season
with performances full
of spirit and they made
Arsenal work hard for
the victory, without
seriously threatening
to equalise.
Wenger said: “I’m
pleased with the
performance because it was a fighting performance
and many people
question us on that
side.” — AFP
Wenger: Nothing
has changed, we
need a perfect
run and we need
a non-perfect run
from them (Chelsea).
Photo by Reuters
The row is just the
latest controversy
to hit Indonesian
football.
third parties”, in an April 10 letter
posted on the sports ministry’s
website yesterday.
The row is just the latest controversy to hit Indonesian football,
Koeman expects last
day drama in battle
for Europe
SOUTHAMPTON: Southampton manager Ronald Koeman
believes the battle to finish fifth
in the Premier League will go
to the final day of the season.
Koeman conceded defeat in
his side’s efforts to break into
the top four after the recent
defeat against Everton, but
Saints’ 2-0 home win over relegation-threatened Hull on Saturday moved them up to fifth,
two points above Liverpool and
Tottenham in the battle for a
berth in next season’s Europa
League. Liverpool will have
the opportunity to leapfrog
Southampton when they face
Newcastle today, but Koeman
insists the three-way contest
will go all the way to the wire.
— AFP
Ancelotti: Real fired up
for Atletico revenge
MADRID: Real Madrid coach
Carlo Ancelotti has said his
side will be out to avenge the
humiliation of their 4-0 defeat
to Atletico Madrid in February
when the sides meet in the
Champions League quarter-final tomorrow. Los Blancos beat
Atletico 4-1 after extra time to
win their 10th European Cup
in last season’s final, but the La
Liga champions have turned
the tide in the Spanish capital this season with four wins
and two draws in six previous
meetings this campaign. The
most recent of those matches
was the most embarrassing
for Real as Atletico outplayed
Ancelotti’s men from first minute to last to seal their biggest
win in a Madrid derby for 28
years. — AFP
PSG retain League Cup,
next up Barcelona
FIFA warns Indonesia govt over domestic league
JAKARTA: FIFA has warned the Indonesian government not to interfere in the running of the country’s
domestic league, the sports ministry said yesterday as it rejected
the accusation.
FIFA secretary-general Jerome
Valcke told sports minister Imam
Nahrawi to allow the Football Association of Indonesia, known by
its Indonesian acronym PSSI, to
manage its affairs “independently and without influence of any
IN BRIEF
which has been beset by problems
in recent years including the cases
of two foreign players who died
after they fell ill but were unable
to pay for treatment because they
hadn’t been paid for months.
The football association has also
been in hot water with FIFA and
the Asian Football Confederation
in recent years over poor management, corruption allegations, leadership tussles and poor security at
major matches. — AFP
PARIS: Zlatan Ibrahimovic inspired holders Paris Saint-Germain (PSG) to the first of a potential four trophies this season
with a 4-0 win over 10-man
Bastia in the League Cup final
on Saturday. In a repeat of the
1995 final, a first-half brace by
the Swedish star, completed by
Edinson Cavani’s second-half
double, kept Ligue 1 leaders
PSG in the hunt for an unprecedented quadruple. The win
teed up Laurent Blanc’s side
nicely for Wednesday’s visit to
Barcelona in the Champions
League quarter-final first leg
with Auxerre awaiting them
in next month’s French Cup
final. — AFP
Deila says Celtic’s title
race far from over
GLASGOW: Celtic manager
Ronny Deila says the race for
the Scottish Premiership title
is far from over after Saturday’s
disappointing 1-1 draw away to
Inverness Caledonian Thistle.
The Hoops have an eight-point
lead at the top of the table as
they chase the fourth successive league title, but this will
be reduced to five if Aberdeen
were to defeat Kilmarnock.
— AFP
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