16  theSun | THURSDAY AUGUST 13 2009

business

AirAsia’s core operating profit

up 328%
KUALA LUMPUR: AirAsia Berhad yesterday an-
nounced that it has recorded a core operating
profit of RM128 million for the quarter period
ended June 30, 2009, a 328% increase compared
with the same period the year before.
Group CEO Tony Fernandes said: “Revenue for
the quarter grew by 8% to RM657 million driven
by robust passenger growth and ancillary income.
The core operating profit of RM128 million was
more than quadruple the profits achieved in the
same period last year.”
He added: “Our results stand in stark contrast
to those of most legacy carriers in these troubled
economic times. While major legacy carriers are cut-
ting flights, grounding planes, retrenching staff and
reporting massive losses, AirAsia is, on the contrary,
seeing rising demand, adding more routes, increas-
ing frequency and securing higher profits.”
“Passenger numbers for the period grew by 24%
to 3.5 million, largely in response to our three-prong
strategy of lowering fares, stimulating travel with
innovative and creative marketing and capturing
market share. Despite lowering fares by an average
of 19%, we still managed to produce strong profit
growth with industry leading margins.”
AMMB set to record high
earnings for FY10
KUALA LUMPUR: AMMB Holdings Bhd, which
posted a 27% increase in net profit for the first
quarter ended June 30, 2009, is expected to con-
tinue a record positive growth for 2010, said OSK
Research yesterday.
“We are upgrading our financial year 2010
earnings forecast by 4.7% on the back of an excep-
tional strength in its first quarter result. We have
imputed a stronger investment banking income
growth contribution assumptions,” OSK Research
explained in its note released yesterday.
AMMB’s first quarter performance was above
the expectations of analysts.
On an annualised basis, its earnings were
25.3% and 19.1% above consensus and the full
year forecast of OSK Research. – Bernama
BCBH’s half-year net profit
up 7.8%
KUALA LUMPUR: Bumiputra-Commerce Hold-
ings Bhd (BCHB) reported a net profit of RM1.277
billion for the six months ended June 30, 2009,
representing a 7.8% year-on-year growth.
Earnings per share stood at 36.2 sen.
Annualised net return on equity (ROE) was
14.%, well ahead of the group’s 2009 key
performance indicator target of 12.5%, the
company said in a statement.
“We are pleased to record another quarter
that’s well ahead of targets,” said,” BCHB Group
chief executive officer Datuk Seri Nazir Razak.
He said CIMB-Niaga’s contribution in
the second quarter surged on the back of
improved net interest margins and strong
treasury income growth. – Bernama
Mah Sing to undertake RM690mil project in Cyberjaya
KUALA LUMPUR: Mah Sing Group Bhd will
develop a gated residential development
project in Cyberjaya with a gross development
value (GDV) of RM690 million.
Mah Sing via its wholly-owned subsidiary,
Myvilla Development Sdn Bhd, is acquiring
46.1ha of prime freehold land in Cyberjaya
from Cyberview Sdn Bhd and Setia Haru-
man Sdn Bhd for RM130.5 million for the
project.
Mah Sing also has the option to purchase
6.32 acres of adjacent commercial land at
RM79 per sq ft within six months from the
date of the signing of the sales and purchase
Maxis likely to relist in its
entirety, says ECM Libra
KUALA LUMPUR: Maxis is likely to relist in
its entirety to maximise its market capitalisa-
tion which may fetch up to between RM40
billion and RM50 billion, to take advantage of
rising investors’ risk appetite, says ECM Libra
Investment Research.
In an investment research note yesterday,
ECM Libra also stated that valuations are quite
attractive for Maxis to re-list now.
“Pushing the case for its re-listing are richer
market valuations as investors turn to stocks
due to very low interest rates and the belief the
global economy is on the mend,” ECM Libra
added.
ECM Libra highlighted that recent devel-
opments and market talk surrounding Maxis
Communications Bhd point to a potential
relisting before the end of the year.
The research house said, should Maxis list
in its entirety, Axiata would be the telco player
most comparable given the similarities with
both having domestic and foreign operations
in India and Indonesia.
However, Axiata, ECM Libra noted, has
additional foreign mobile operations in Sri
Lanka, Bangladesh, Cambodia and an associ-
ate in Singapore.
“Axiata is currently trading at a price earn-
ings (PE) multiple of 18.8 times its financial
year 2009 consensus Earnings price per share
(EPS),” ECM Libra said.
In comparison, ECM Libra added, in 2007
when Maxis was privatised at RM15.60 per
share, it was trading at a historical PE multiple
agreement.
“The acquisition of the Cyberjaya land is
timely as the property market is stabilising
and should recover by the middle of next year.
We need to plan and now is a good time to
move forward,” Mah Sing’s group managing
director/chief executive Tan Sri Leong Hoy
Kum told a media briefing yesterday.
On another note, Leong viewed Permodalan
Nasional Bhd’s (PNB) investment in the group
as a strategic investment that will provide
more commercial ventures.
“This (the investment) will lead us to pos-
sible opportunities for the two parties to work
of 18.6 times based on its FY06 EPS.
According to ECM Libra, this may signal
that investors are willing to pay a premium
for Axiata’s growth story and do the same for
Maxis.
ECM Libra also indicated that those willing
to take a bet on Maxis and its management
may opt to invest with the company for a more
exciting growth story.
The research house said Axiata’s stable of
higher quality but more matured foreign assets
offered more comfort for those also seeking
growth but with a correspondingly less risk.
“The relisting of Maxis will have very mini-
mal impact on Telekom Malaysia (TM) given
its constrasting business models and appeal.
“TM’s earnings growth is somewhat tepid.
But investors like TM for its high dividend
yields and stability in earnings,” ECM Libra
said.
In the research note, ECM Libra also said
while Maxis offered high growth potential, it
had less stable earnings and is unlikely to pay
generous dividends due to high capex needs.
ECM Libra also said if Maxis were to list
its domestic operations only – it thought this is
unlikely – investors would have an alternative
pure domestic mobile operator to invest in,
besides DiGi.
“We believe DiGi will not be marginalised
entirely as it will continue to attract interest as
a decent dividend yielding stock.
“Even without special dividends, we expect
DiGi to generate a dividend yield of 4.5%. With
together on commercial ventures.”
In June, Mah Sing said the group was talk-
ing to PNB, the nation’s biggest fund manager,
for projects in the Klang Valley and both are
eyeing potential land banks.
PNB acquired substantial shareholding in
Mah Sing in mid-January, controlling about
31.4 million shares or 5.1%.
PNB’s unit trust, Amanah Saham Bumiputra,
became a substantial shareholder in Mah Sing
in August last year, with 5.3% shareholding or
33.2 million shares.
As of April 7, ASB increased its shareholding
to 14.7% or 92.3 million shares. – Bernama
special dividends, yields could be as high as
8.1%,” it added.
As for the overall telecommunication sec-
tor, ECM Libra maintained its overweight
stand on the sector.
ECM Libra said there may be a potential
earnings surprise for Axiata when its second
quarter 2009 results are released towards the
end of the month.
“This may result in an upwards earnings
revision given the turnaround in the global
economy, leading to a potential re-rating of the
stock,” it explained.
The research house also suggested switch-
ing from Axiata to Maxis for those seeking the
greatest risk-return trade-off.
“If Maxis relists in its entirety, we suggest
switching from Axiata to Maxis, given that its
Indian and Indonesian operations are start-
ing from smaller bases and offer the greatest
growth potential.
“As a result, Maxis will offer the highest
potential for capital appreciation compared
with Axiata,” ECM Libra noted.
Nonetheless, investing in Maxis, ECM
Libra said, carried a higher risk than Axiata
as the formers foreign operations are not as
established on account of being very competi-
tive.
“Maxis’ foreign operations are at greater
risk should a consolidation occur in the over-
crowded markets of India and Indonesia.
“Investors seeking defensiveness should
stay with TM or DiGi,” it said. – Bernama

DiGi banks on music

to grow youth market
Jordan feels KUALA LUMPUR: DiGi Telecommunications Sdn Bhd, in a strategic move
‘robbed’ to capture a bigger share of the youth segment, yesterday introduced the
after DiGi Music Unlimited’s web and mobile music service.
Head of Products and Segment Marketing Albern Murty said the new
Schumacher service provided DiGi a compelling platform to make greater inroads into
U-turn the youth market.
pg 28 “With over 50% of the Malaysian population made up of youths, this
segment is an important and growing market for DiGi,” he told reporters
here after launching DiGi Music Unlimited.
Murty said DiGi, which enjoyed a 27% market share, was planning to
capture one third of the youth segment market.
“We have built a strong affinity with this segment over the years and we
look to create even more relevance by leveraging off the appeal of music
which is a big part of their lives,” Murty said.
He added that DiGi Music Unlimited was about providing customers
a holistic social music experience that would shape the future of music
consumption in this country.
“It is a perfect example of delivering our value proposition of relevance
through music, ease of use through accessibility via mobile phone and
personal computer, all for RM5 per month.
Murty said DiGi Music Unlimited customers would pay no data charges
for browsing and downloads when they visit the website nor would they
be charged for sharing playlists and tracks with friends via Short Message
Service (SMS), e-mail and social networks.
DiGi’s revenue in the last five years more than doubled to approximately
RM4.8 billion and DiGi’s customer base as of June 30, 2009 stood at 7.2
million.
DiGI is a wholly-owned subsidiary of DiGi.Com Bhd, which is listed on
Bursa Malaysia Securities Bhd. – Bernama