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 MALAYSIA NOT BEING ‘SLOW’ IN ITS COVID-19
VACCINATION EXERCISE, SAYS KHAIRY p2
T U E S DAY, A P R I L 2 0 , 2 0 2 1 w w w. t h e e d g e m a r k e t s. c o m
ISSUE 171/2021

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 T U E S D AY A P R I L 2 0 , 2 0 2 1
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PUTRAJAYA (April 19): Malaysia has not
been ‘slow’ in carrying out its vaccination
exercise, National Covid-19 Immunisation
Programme Coordinating Minister Khairy
Jamaluddin said today.
To date, a total of 1.14 million Covid-19
vaccine doses from the total 1.56 million re-
ceived so far have been given, he said, adding
that 701,812 individuals have received their
first dose while 443,029 people have been
fully vaccinated with the required two doses.
On claims that Malaysia’s vaccination rate
was slow despite having sufficient vaccine sup-
ply, Khairy said the government understands
the people’s concerns, but they will still have
to stick to their scheduled turns and phases.
“As informed before this, everyone has to
wait [for] their turn as scheduled as how the
first phase was for the frontliners, the second
[is] for senior citizens and so forth.We have to
stick to the phases according to the respective
categories,” he said.
Khairy, who is Science, Technology and
’Risk of infectivity only 0.003% after second dose of Covid-19 vaccine’
PUTRAJAYA (April 19): The risk of Cov-
id-19 infectivity among the frontliners who
have received both doses of the vaccine
jabs is at its lowest at just 0.003%, said Co-
ordinating Minister of the National Cov-
id-19 Immunisation Programme Khairy
Jamaluddin.
He said this showed the level of effective-
ness of the Covid-19 vaccine, which means
there is a better chance to either tackle the
risk of infection and death or being admit-
ted to the intensive care unit.
“If there are nine cases, namely those
who tested positive for Covid-19 after receiv-
ing two doses of the vaccine jabs, not one of
them suffered any severe or mild symptoms.
“They only tested positive for Covid-19.
I think we can say that this vaccine is effec-
tive, with a low risk of infectivity,” he told a
joint media conference with Health Minister
Datuk Seri Dr Adham Baba on the latest de-
velopment with regard to the National Cov-
2 THEEDGE CEO MORNING BRIEF
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Selangor, Malaysia
H O M E
Malaysia not
being ‘slow’ in
its Covid-19
vaccination
exercise, says
Khairy
Bernama
Innovation Minister, told reporters this at a
joint press conference with Health Minister
Datuk Seri Dr Adham Baba on developments
concerning the programme.
Khairy said Malaysia’s vaccination pro-
gramme follows scheduled phases, similar to
the one adopted by other countries such as
Bernama
id-19 Immunisation Programme here today.
The media had previously reported that
nine healthcare workers contracted Covid-19
two weeks after receiving the second dose
of the vaccine jab, while 31 other cases, also
involving healthcare workers, were detected
less than two weeks after getting the second
dose of the Covid-19 jab.
However, Health director-general Tan
Sri Dr Noor Hisham Abdullah was quoted
as saying that all of them did not suffer any
severe symptoms.
Khairy said that so far a total 272,019
frontliners had received the second dose of
vaccine jabs which were given under phase
one of the immunisation programme.
According to Dr Adham, all the nine
healthcare workers who had received the
second dose of the vaccine jabs did not know
they were Covid-19 positive.
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the United Kingdom (UK), which uses the
age chart.
However, the UK only opens vaccination
registration once the recipients are eligible
according to their respective age group, while
in Malaysia, registration is open to all at one
go regardless of age or category.
He said to date, a total of 8.99 million indi-
viduals have registered for vaccination on the
MySejahtera application, with those aged 60
and above totalling 1.44 million, the disabled
amounting to 136,798 people, while individu-
als with chronic diseases totalled 2.03 million.
The state with the highest achievement
ratio of vaccine registrations is Putrajaya with
98%, followed by Selangor and Kuala Lum-
pur with 50%, Penang (45%) and Negeri
Sembilan (44%).
He also said Malaysia is due to receive
additional supplies of the Pfizer-BioNTech
vaccine totalling 128,700 doses on April 21,
followed by 36,270 doses on April 22 and a
further 12,870 doses on April 23.
“When we tested, they were Covid-19
positive,” he said.
On the findings of the Covid-19 2.0
vaccine acceptance survey carried out
from April 3-16, Dr Adham said 85% of
the 15,639 respondents were ready to re-
ceive the Covid-19 vaccine.
“Only 10% of the respondents said they
were not sure whether or not to receive the
vaccine, while the other five per cent did not
agree (to be vaccinated),” he said.
The survey, which was conducted on-
line by the Ministry of Health, was aimed
at identifying the people’s views regard-
ing their acceptance and rejection of the
Covid-19 vaccine, as well as the factors
that influenced their decisions.
Read also: Malaysia proposes mutual recog-
nition on vaccination certificate with Aus-
tralia, says Hishammuddin Click here
 T U E S D AY A P R I L 2 0 , 2 0 2 1
KUALA LUMPUR (April 19):The govern-
ment has announced its partnership with
Microsoft under the Bersama Malaysia ini-
tiative, which will see the hyperscaler estab-
lish its first data centre region in Malaysia.
In a statement, Prime Minister Tan Sri
Muhyiddin Yassin said the initiative will
see investments amounting to US$1 bil-
lion (RM4 billion) over the next five years.
He said Microsoft’s data centre region
will effectively consist of multiple data cen-
tres, managing data from various countries.
“As I understand it, according to Inter-
national Data Corporation, the ripple ef-
fects of the data centre region investment
today could translate to US$6.90 of revenue
generated in the local cloud ecosystem for
every US$1 of Microsoft Malaysia’s cloud
revenue by 2024.
“It is estimated that it will help create
19,000 jobs including 4,000 IT-related jobs
amongst its cloud users,” said the prime
minister.
He also welcomed the public-private
partnerships formed by Microsoft and its
Malaysia
reports 2,078
new Covid-19
infections,
including 589
from Sarawak
BY SULHI KHALID
theedgemarkets.com
KUALA LUMPUR (April 19): New
Covid-19 cases in the country dropped
slightly to 2,078, from 2,195 yesterday,
with Sarawak accounting for 589 cases.
Selangor reported 457 cases, followed
by Kelantan with 290, Kuala Lumpur
with 153, Sabah with 125, and Johor
with 115.
All but 13 of the latest infections were
locally transmitted, Health director-gen-
eral Tan Sri Dr Noor Hisham Abdullah
said in a statement.
Eight Covid-19-related deaths were
reported in the 24 hours as of noon today
— three in Sarawak, two each in Selangor
and Sabah, and one in Kuala Lumpur.
A total of 1,402 new recoveries were
reported, bringing total recoveries to
355,224, or 94.2% of all cases.
The number of active cases — which
carry transmission risks — stood at
3 THEEDGE CEO MORNING BRIEF
H O M E
PM announces
Microsoft
partnership under
US$1b Bersama
Malaysia initiative
BY AHMAD NAQIB IDRIS
theedgemarkets.com
partners, including the Malaysian Admin-
istrative Modernisation and Management
Planning Unit (MAMPU), Human Re-
sources Development Fund (HRDF), Pe-
tronas, Celcom and Grab.
These partnerships are expected to assist
in skilling up to one million Malaysians by
2023, Muhyiddin said.
The memorandums of understanding
for these partnerships will be signed today.
Malaysia’s coronavirus curve showing nascent signs of upward climb
6000
Daily new cases
5000
4000
3000
2000
1000
0
Sept 1, 2020
20,522. These included 228 patients in
intensive care, of which 93 required res-
piratory help.
The health ministry identified 14 new
infection clusters, with six from education
centres, four from community clusters,
three from workplaces, and one from a
religious centre.
The education centre clusters are Tan-
gok (Kelantan), Pulai Chondong (Kelan-
tan), Jalan Tagasan (Sabah), Jalan Medan
Aliff (Johor), Jalan Weng (Kedah) and one
from a school/educational institution in
Jalan Hospital (Kelantan).
The community clusters are Sungai
Duaan (Sarawak), Sungai Passin (Sar-
awak), Sungai Selitut (Sarawak) and Jalan
Bandar Universiti (Perak).
The workplace clusters are Jalan Ca-
haya Baru (Johor), Cyber Park (Johor)
and Jalan Sulah 16 (Selangor).
“As we cement the Microsoft partner-
ship today, I hope this is just the first green
shoots of a broader meadow of investments
in Malaysia, for Microsoft and other data
players.
“This significant investment from Micro-
soft further fortifies Malaysia’s position as
a potential regional data hub and we stand
ever ready to welcome more such partner-
ships as we work with our stakeholders to
continually improve Malaysia’s value prop-
osition in this big data space,” he said.
The partnership is in line with Malay-
sia’s MyDigital initiative and the Malaysia
Digital Economy Blueprint, which was un-
veiled in February 2021.
Under the blueprint, the government
had said that it granted conditional approv-
als to four cloud service providers (CSPs)
— hyperscalers Microsoft, Amazon, Google
and local telecommunications giant Tele-
kom Malaysia Bhd.
Muhyiddin previously said these CSPs
will invest between RM12 billion and RM15
billion over the next five years.
7-day moving average
2,078
2,137
April 19, 2021
The sole religious centre cluster is
Bayan Cenderawasih in Kedah. To date,
the ministry has identified 1,534 Covid-19
clusters, of which 1,194 have been declared
ended, leaving 340 active clusters.
The clusters that reported the highest
numbers of Covid-19 cases today were
Sungai Duan (62 cases), Kampung Domis
(55) and Jalan Sulah 16 (42).
Read also:
19 schools in Selangor’s Petaling
district to close after Covid-19 cases
detected Click here
Covid-19: Kindies, childcare centres in
Sarawak red zones to close for 14 days
Click here
 T U E S D AY A P R I L 2 0 , 2 0 2 1
Rising Covid-19 cases, slow
vaccination efforts could lead to
pullback in market — CGS-CIMB
KUALA LUMPUR (April 19): CGS-
CIMB Research said concerns over the
rising number of Covid-19 cases, as well
as slower vaccination efforts, could lead
to a pullback in the market.
In a strategy note today, it said the re-
cent increases in Covid-19 cases and the
infectivity rate have raised concerns that
movements may be restricted in selected
areas, and that the interstate travel ban
would be prolonged. This, it said, could
impact the pace of economic and corpo-
rate earnings recovery.
“Latest statistics revealed that close
to 700,000 had received one dose of the
Covid-19 vaccines, broadly meeting [the
target of] Phase 1 of the vaccination pro-
gramme. However, the key test is Phase
2, during which the government targets
to vaccinate 9.4 million individuals over
five months.
“To achieve this, we estimate the gov-
ernment will need to raise the number of
shots per day, ensure sufficient vaccine
supplies are available, and that more in-
dividuals are registered and turn up for
the vaccination.
“Any major delay in the execution of
the immunisation programme, coupled
with the increase in Covid-19 cases, could
dampen market sentiment and prompt
investors to profit-take on recovery stocks
given the potential earnings risk,” said
its analysts Ivy Ng Lee Fang and Nagu-
lan Ravi.
Total vaccinated so far in selected countries
United Kingdom 9.93 mil
United States
Germany 5.42 mil
Singapore 535,864
Indonesia 5.91 mil
India 16.48 mil
Japan 678,405
South Korea 60,585
Hong Kong 359,926
Malaysia 443,029
0 20 40 60
Number of individuals who have completed second dose of Covid-19 vaccine
Sources: Various news reports
4 THEEDGE CEO MORNING BRIEF
H O M E
BY SYAFIQAH SALIM Kuala Lumpur (38,642) and Sarawak
theedgemarkets.com (34,590), according to data released by
the Health Ministry.
Going forward, the CGS-CIMB ana-
lysts said the research house is keeping its
FBM KLCI target at 1,699 points (for-
ward price-earnings of 15.2 times).
At the closing bell today, the KLCI was
down 0.5% or 8.09 points to 1,600.29.
The research house’s top three stock
picks are Inari Amertron Bhd, Public
Bank Bhd and Telekom Malaysia Bhd
(TM).
“We like Inari as a proxy for rising de-
mand for radio frequency (RF) chips on
the back of 5G mobile network migration
and its new system-in-package capacity
expansion at P34. We expect its RF di-
Based on the latest reported data as at vision to deliver an 85% y-o-y (year-on-
April 18, the United States recorded the year) sales growth in FY21 (financial year
highest number of individuals who had 2021) ending June 30, 2021.
had their second dose of the Covid-19 “Public Bank is our top pick among
vaccine, with a total of 84.26 million peo- Malaysian banks as we believe it is the
ple being fully vaccinated. most defensive against the credit risk aris-
After the US was India (16.48 million ing from the Covid-19 outbreak. Its credit
people), followed by the United Kingdom charge-off rate of 33bps (basis points) in
(9.93 million), Indonesia (5.91 million), FY20 was among the lowest in the sec-
Germany (5.43 million), Japan (678,405), tor,” said the analysts.
Singapore (535,864), Malaysia (443,029), They said TM is CGS-CIMB’s top
Hong Kong (359,926 ) and South Ko- Malaysian telco pick due to the robust
rea (60,585). core earnings per share growth expect-
In Malaysia, Selangor registered the ed for its FY21, FY22 and FY23 by
highest number for a second dose of Cov- 15%/9%/21% y-o-y.
id-19 injections with 63,166 people, fol- “Its FY21F EV/OpFCF (forecast en-
lowed by Perak (48,822), Sabah (43,304), terprise value/operating free cash flow) is
also at a 21% discount to the Malaysian
mobile average,” the analysts added.
Inari closed one sen or 0.29% higher
Population Start date of at RM3.41 today, valuing the company
the vaccination at RM11.4 billion. Public Bank fell one
exercise
sen or 0.24% to settle at RM4.19, with
68.2 mil Dec 8, 2020 a market value of RM81.33 billion. TM,
84.26 mil 332.91 mil Dec 14, 2020 meanwhile, rose six sen or 1.02% to close
83.99 mil Dec 27, 2020 at RM5.96, giving it a market capitalisa-
tion of RM22.49 billion.
5.89 mil Dec 30, 2020
It is worth noting that Malaysia’s daily
276.36 mil Jan 13, 2021 new Covid-19 cases have stayed above
1.393 bil Jan 16, 2021 the 2,000 mark for five straight days. The
126.05 mil Feb 17, 2021 country’s daily cases crossed the 2,000-
51.3 mil Feb 26, 2021 mark last Thursday for the first time since
7.55 mil Feb 28, 2021 March 6. Today, it reported 2,078 new
32.77 mil March 2, 2021
Covid-cases.
Active cases, which carry high trans-
80 100 (mil)
mission risk, surged to 20,522 today from
17,575 last Thursday. The death toll due
to coronavirus in Malaysia now stood at
1,386.
 T U E S D AY A P R I L 2 0 , 2 0 2 1 5 THEEDGE CEO MORNING BRIEF

H O M E

Appellate court allows Grab to have

merits of challenge against proposed
RM87m fine by MyCC heard
BY HAFIZ YATIM REUTERS
theedgemarkets.com

PUTRAJAYA (April 19): A three-member

Court of Appeal bench today granted leave
to Grab Holdings Inc and its subsidiaries
GrabCar Sdn Bhd and MyTeksi Sdn Bhd
to have the merits of their judicial review
application against the proposed RM86.77
million fine by the Malaysia Competition
Commission (MyCC) heard.
Justice Datuk Hanipah Farikullah, who
led the bench, said there are merits in the
appeal based on the evidence and there
is an arguable case which can be argued
further in the substantive stage.
“This is not a frivolous and vexatious
application by the appellants. The High
Court judgement is set aside,” she said
in the unanimous decision.
Sitting with Justice Hanipah were Jus-
tices Datuk Hadhariah Syed Ismail and
Datuk Hamzah Hashim.
They directed the case be remitted to
the High Court on April 26 and for the
court to fix a hearing date.
Hanipah also ordered MyCC to pay
total costs of RM12,000 to the three com-
panies. ii) send notifications to all its drivers in also concerned over media reports in what
Grab is accused by MyCC of alleged- relation to the removal of the restrictive it calls “negative publicity” concerning the
ly “abusing its dominant position by im- clause via the short messaging system result of the proposed decision.
posing a restrictive clause on its drivers (SMS) for 12 consecutive weeks, com- Meanwhile, MyCC’s counsel Da-
which effectively prevented its drivers from mencing from the date of issuance of tuk Lim Chee Wee, who appeared with
promoting Grab’s current and potential the proposed decision. Kwan Will Sen, said the proposed decision
competitors on e-hailing platforms and Malik, who appeared with Shanti Kan- should not be treated as a final decision
in transit media advertising”. diah, Yvonne Lim, Khoo Suk Chyi and and hence, the appeal for a judicial review
However, the appellants’ counsel Datuk Nimraat Kaur, said the conditions are a by Grab should be dismissed.
Malik Imtiaz Sarwar contended that while violation of the principles of natural justice “There were cases where MyCC re-
they abide by MyCC’s power to investigate, as MyCC should not be imposing condi- scinded the earlier proposed decision after
prosecute and judge, the commission should tions which could lead to Grab being fined hearing the case, with the case of Maju
not impose conditions before the proposed RM15,000 a day, if it does not comply, Steel as one of them,” he said.
decision on the fine is imposed on them. before the proposed decision is delivered Lim also gave an undertaking that
Malik complained that before MyCC or made final. MyCC would not impose the conditions.
arrived at its proposed decision, there was “MyCC did not have the power to im- “By allowing a judicial review, it may
a RM15,000 daily penalty that could be pose a penalty that took effect upon the open the floodgates,” he warned.
imposed on Grab from the date of ser- issuance of the proposed decision,” he said. However, Malik argued that email
vice if it failed to comply with MyCC’s He said that Grab’s representatives had correspondence between his client and
directions. met MyCC to assist in its investigation, but MyCC showed they had to comply with
are concerned over biasness as according the two conditions imposed and hence,
Punitive penalty conditions imposed to the Competition Act 2010, fines and leave should be granted.
on Grab if it does not comply penalties issued would be used by MyCC Grab and its two subsidiaries sought
The directions issued by MyCC on Grab for its remuneration, expenses and also its the judicial review in the High Court in
and the two appellants are: employees. February last year following MyCC’s pro-
i) to permanently remove the restrictive Hence, it is concerned over possible posed fine. However, the application was
clause from the terms and conditions, biasness before MyCC hears its case, or dismissed as the court deemed the move
supplement terms of use and code of when the matter goes on appeal to the premature, given that the proposed deci-
conduct and; Competition Appeal Tribunal (CAT). It is sion was not yet final.
 T U E S D AY A P R I L 2 0 , 2 0 2 1
KUALA LUMPUR (April 19): Moody’s
Investors Service has assigned a senior unse-
cured rating of A3 to the proposed US dol-
lar-denominated trust certificates (sukuks)
with maturities of 10 and 30 years to be
issued by Malaysia Wakala Sukuk Bhd, a
special purpose vehicle established by the
Malaysian government.
In a statement today, Moody’s said the
A3 rating assigned to the sukuks are at the
same level as the long-term local-currency
and foreign-currency issuer ratings of the
Malaysian government, as the sukuk hold-
ers will effectively be exposed to the Malay-
sian government’s senior unsecured credit
risk, will not be exposed to the risk of per-
formance of the portfolio assets relating to
the certificates, will not have any preferen-
tial claim or recourse over the trust assets
as certificate holders cannot sell or dispose
of any trust assets except as expressly pro-
vided for under the transaction documents,
and only have rights against the Malaysian
government, ranking pari passu with other
senior unsecured obligations as provided in
the transaction documents.
It said legal opinions have also confirmed
legal, binding and enforceable obligations
for the Malaysian government.
The proceeds of the sukuks will be used
by the issuer to purchase a Wakala asset
pool consisting of vouchers representing
travel entitlements on selected public trans-
port in Malaysia.
The assets will be managed by the gov-
ernment as the agent for the provision of
Wakala services on behalf of the issuer (act-
ing as trustee for the certificate holders).
The government will collect all returns
on the portfolio assets against the relevant
KUALA LUMPUR (April 19): Boustead
Holdings Bhd is selling a 6.59-acre piece
of freehold land on Jalan Cochrane here to
Sunway Bhd for RM233.39 million.
In a bourse filing, Boustead said its whol-
ly-owned indirect subsidiary Mutiara Rini
Sdn Bhd had signed a sale and purchase
agreement with Sunway’s wholly-owned in-
direct unit Sunway Rahman Putera Sdn Bhd.
According to the group, the land is va-
cant with residential status, but has com-
mercial potential. It is around 100m from
the Cochrane MRT station and about 4km
by road to the city centre, while MyTOWN
Shopping Centre and IKEA Cheras are also
close by.
Boustead noted that it was selling the land
at a 6.1% or RM13.4 million premium over
its market value of RM220 million.The sale
will result in a gain on disposal of RM54.1
million or 2.67 sen per share.
The Lembaga Tabung Angkatan Tentera
(LTAT)-controlled conglomerate will be
6 THEEDGE CEO MORNING BRIEF
H O M E
Moody’s assigns
A3 rating to
Malaysia’s
international
sovereign sukuks
BY SURIN MURUGIAH
theedgemarkets.com
periodic distribution amounts due.
Moody’s also noted that its sukuk rat-
ings do not express an opinion on the
structure’s compliance with Shariah law.
The rating agency said Malaysia’s A3 rat-
ing is underpinned by its diversified, compet-
itive and moderately large economy, strong
medium-term growth potential compared
with peers, and ample natural resources.
It said credible and effective macroe-
conomic policymaking institutions also
Boustead sells
Jalan Cochrane
land to Sunway
for RM233m
BY ARJUNA CHANDRAN SHANKAR
theedgemarkets.com
using the proceeds from the sale to pare
down its debts, provide some working cap-
ital and defray any costs associated with
the sale.
Specifically, it will be using RM101
million to repay bank borrowings, which
is expected to result in an interest saving
from the repayment of bank borrowings
at RM4.5 million per annum.
RM112.8 million of the disposal’s pro-
foster stability and support the country’s
economic resiliency.
These conditions have generated a large
pool of domestic savings over time, which
anchors interest payments for the govern-
ment and reduces its liquidity risk and re-
liance on external financing.
Balanced against these credit strengths
are the government’s narrow revenue base
that limits fiscal flexibility and its relatively
high debt burden and weak debt afforda-
bility compared with its peers.
Moody’s said political noise also has
the potential to distract the government
from its policy priorities, particularly
longer-term reforms that may strengthen
the credit profile over time.
A change in Malaysia’s sovereign rating
will be automatically reflected in the trust
certificate ratings of the issuer.
Moody’s said downward pressure on
the rating would stem from a further weak-
ening in the government’s debt and debt
affordability metrics, a sharp rise in con-
tingent liabilities, and/or a softening of
the commitment to medium-term fiscal
consolidation that were to result in con-
tinued deterioration in the government’s
fiscal strength.
“Volatile politics that undermined the
credibility and effectiveness of institutions
and threatened the stability of capital flows
would also be credit negative.
“In the context of the longer-term un-
certainty over global trade patterns and
supply chains, weaker medium-term
growth prospects, including through
structurally lower investment, would ad-
ditionally put downward pressure on the
rating,” it said.
ceeds will be used to pay for working cap-
ital requirements, while RM19.6 million
will be used to defray expenses associated
with the sale.
“The proposed disposal also allows
BHB Group to strengthen its liquidity and
cash flow position by raising total net cash
proceeds of approximately RM213.8 mil-
lion (net of estimated expenses), which will
be utilised for repayment of bank borrow-
ings and working capital,” it said.
Following the sale, Boustead said its
gearing ratio is expected to decline to
1.36 times, from 1.39 times previously.
The group’s borrowings will also decline
to RM7.81 billion, from RM7.91 billion
as of Dec 31, 2019 (FY19).
Affin Hwang Investment Bank Bhd is
the principal adviser for the proposed dis-
posal.
Shares in Boustead finished 1.7% or a
sen lower at 58 sen, valuing it at RM1.18
billion. It saw 2.15 million shares done.
 T U E S D AY A P R I L 2 0 , 2 0 2 1
M3 Techologies (Asia) Bhd’s
Top 6 Shareholders
Name
Stake Stake
(Mil Shares) (%)
XOX Bhd 72.38 9.39
Lim Seng Boon 57.11 7.4
Voon Sze Lin 47.48 6.16
DGB Networks Sdn Bhd 25.6 3.32
Choong Yean Yaw 18.63 2.42
Voon Jye Wah 13.36 1.73
Compiled as at April 19, 2021
Sources: Bursa Malaysia/Bloomberg
M3 Technologies
shareholders
reject private
placement
BY ARJUNA CHANDRAN SHANKAR
theedgemarkets.com
KUALA LUMPUR (April 19): M3
Technologies (Asia) Bhd’s sharehold-
ers rejected the mobile solutions pro-
vider’s proposed private placement
at an extraordinary general meeting
today.
The group said seven shareholders
controlling 146.1 million shares had
rejected the resolution calling for the
placement, versus four shareholders
controlling 76.38 million shares who
voted in favour of the resolution.
In terms of percentage of voted
shares, 65.67% voted against the res-
olution, while 34.33% was in favour.
Proposed on March 15, the pri-
vate placement involved 232.15 mil-
lion shares or 30% of share capital to
raise RM9.82 million. Of that amount,
RM4.7 million was to be used for the
enhancement of the group’s i3Team-
Works, development of i3Desktop and
marketing. Another RM4.54 million
was to be used as working capital.
The group had completed another
private placement on Jan 18, placing
out 128.54 million shares or 20% of
its share base at the time.
Had the latest placement gone
through, M3 Technologies’ share cap-
ital would have increased to 1.01 bil-
lion shares, from 773.82 billion shares
currently.
M3 Technologies’ share price rose
0.5 sen or 11.11% to close at five sen
today, valuing the group at RM38.69
billion. The counter saw 25.21 mil-
lion shares traded.
7 THEEDGE CEO MORNING BRIEF
H O M E
Dataprep sees
another sharp share
price surge despite
lack of catalyst
BY AHMAD NAQIB IDRIS
theedgemarkets.com
KUALA LUMPUR (April 19): Dataprep
Holdings Bhd saw another sharp increase
in its share price today, continuing its re-
bound after touching a one-month low of
76 sen on April 14, amid high volatility.
The counter, which was barely traded
prior to February, saw a spike in trading
activity and its share price from Feb 11
onwards, despite there not being a sub-
stantial catalyst behind the stock’s surge.
Within a span of about one month,
Dataprep surged over 2,000% to touch
a 20-year high of RM3.79 on March 15,
before subsequently plunging 80% over
the following month to 76 sen.
The sudden plunge had prompted Bur-
sa Malaysia to issue a statement advising
investors to exercise caution in the trading
of Dataprep shares.
The counter had since rebounded and
closed 44 sen or 29.9% higher at RM2.00,
with some 142.4 million shares traded. Its
market capitalisation was RM1.23 billion.
Besides a proposed acquisition of a 51%
stake in multimedia hardware and compo-
nent distributor RIDAA Associates Sdn Bhd
and a memorandum of collaboration with IT
consulting and services provider company
Asia Coding Centre Sdn Bhd for provision of
integrated solution technology for Covid-19
screening announced to the bourse, there has
Group of Artroniq
shareholders
calls for EGM to
remove board
of directors
BY ARJUNA CHANDRAN SHANKAR
theedgemarkets.com
KUALA LUMPUR (April 19): A group
of Artroniq Bhd (formerly Plastrade Tech-
nology Bhd) shareholders wants to have
the company's entire board of directors
Dataprep Holdings Bhd
4
RM
3
2 RM2.00
1
0
March 30, 2020 April 19, 2021
Compiled at 6:18pm on April 19, 2021
Source: Bloomberg
not been much going on with the company.
However, some of its directors have
been accumulating shares since last month.
Independent non-executive director
Nor Adha Yahya had acquired one mil-
lion shares on March 29, after exercising
his long term incentive plan (LTIP).
Datuk Abdul Aziz Ishak had also exercised
his LTIP, acquiring 300,000 shares on March
4, as well as Mohamad Sabir Sabri, who ac-
quired another 500,000 shares via the LTIP.
Some of its employees have also been
exercising the company’s employees’ share
options scheme, with a total of 14.69 million
shares granted since early March this year.
Meanwhile, its major shareholder Tan
Sri Muhammad Ikmal Opat Abdullah —
the founder of Widad Business Group —
had disposed of a block of 11.11 million
shares on Feb 16, after acquiring the same
number of shares in October last year.
He had subsequently acquired 200,000
Dataprep shares on March 1 from the open
market, bringing his total stake in the com-
pany to 326.88 million shares or 54.24%.
removed, and appoint new ones in their
stead.
In a bourse filing, Artroniq said four
shareholders — TeeYen Chong,Yeoh Guan
Fook, Lee Pei Mei and Chew Hun Seng
— who claimed they collectively control
at least a 10% stake in the company, want
to remove non-executive chairman Steven
Wong, executive director Choy Eng Lun,
and independent and non-executive direc-
tors Tan Tian Wooi and Lam Kwan Siew
from the group’s board via an extraordi-
nary general meeting (EGM).
Artroniq said it received the notice of
intention from the four shareholders on
April 16 to remove the directors and to
call for this EGM, which is planned to be
held virtually on May 17 at 10am.
CO N TI N UES O N PAGE 8
 T U E S D AY A P R I L 2 0 , 2 0 2 1
Ministry to
implement
housing project
worth RM6b
using Kenaf
Building System
Bernama
ISKANDAR PUTERI (April 19): A
long-term housing project worth RM6
billion using the Kenaf Building System
(KBS) will be implemented in the gov-
ernment’s effort to introduce the tech-
nology nationwide.
Plantation Industries and Commodi-
ties Minister Datuk Dr Mohd Khairuddin
Aman Razali said the project, which is a
collaboration between the National Kenaf
and Tobacco Board (LKTN) and several
agencies, will require two million tonnes of
kenaf and 20,000 hectares of kenaf plants
within 10 years.
“It (this project) is now in the final
process of discussion. We will official-
ly announce this project in detail after
the discussions are finalised,” he told re-
porters after witnessing the signing of a
memorandum of understanding (MoU)
between LKTN and KPRJ Builders Sdn
Bhd (KBSB) here today.
Mohd Khairuddin said the ministry
planned to commercialise KBS technol-
ogy nationwide as it has the potential to
speed up the construction period and
even save energy consumption and con-
struction costs between 20% and 30%
compared to conventional methods.
FROM PAGE 7
They are also calling for any directors
appointed between now and the EGM to
be removed as well, said Artroniq.
At the same time, the shareholders have
put forth resolutions to appoint Rahimi Ram-
li,Tan Teck Khong, ChinYew Thong and An-
drea Huong as the company's new directors.
“The company is seeking legal advice on
the above and further announcement will be
made on the development thereof accord-
ingly, if any,” Artroniq's bourse filing read.
Artroniq makes compounds of power ca-
bles and distributes ICT products. It has
largely been loss-making for four consec-
utive years since the financial year ended
Dec 31, 2017 (FY17).
For FY20, the group widened its loss-
8 THEEDGE CEO MORNING BRIEF
H O M E
BERNAMA
He said the development of KBS tech-
nology would have a positive impact on the
environment where kenaf plants absorbed
20 tonnes of carbon dioxide (CO2) per hec-
tare and the use of the commodity-based
building material in a house could store
28 tonnes of CO2 per 1,000 square feet.
“KBS is a good thermal insulation ma-
terial that can save electricity, especially
for air conditioners for a long time, as the
main material is kenaf core which is light
and environmentally friendly.
“The important aspects of its remarka-
ble durability are being eco-friendly, lighter,
cooling the environment and faster from
the construction management standpoint
than that of conventional methods,” he said.
“The area under kenaf cultivation na-
tionwide is 2,000 hectares with Pahang
and Kelantan having the largest kenaf
cultivation while Johor has an area of
20 hectares cultivated by private small-
holders.
Under the MoU, LKTN and KBSB
will implement a pilot project based on
KBS technology, namely the construction
of 10 units of asnaf houses (each measur-
ing 660 square feet) totalling RM550,000
in Mersing.
es to RM11.83 million, from RM2.23
million the year before, even as revenue
climbed 43.3% to RM169.82 million from
RM118.5 million.
As at July 21, 2020, Artroniq’s largest
shareholders included Heng Kear Huat
with direct and indirect stakes of 22.84%
and 4.34% respectively, followed by Pua
Kong Hoi (21.19%) and Tee Han Seang
(an 8.3% indirect stake).
Heng emerged as the largest shareholder
of Plastrade in January 2020.The company
changed its name to Artroniq last November.
Shares in Atroniq closed 6% or three sen
lower at 47 sen today, giving it a market cap-
italisation of RM135.80 million.The coun-
ter, which has been traded below 20 sen
for much of the last few years, saw its share
MyJet Xpress
Airlines gets
lion’s share of
ATR application
approval in 1Q21
BY SURIN MURUGIAH
theedgemarkets.com
KUALA LUMPUR (April 19): Cargo air-
line MyJet Xpress Airlines Sdn Bhd received
the highest number of Air Traffic Rights
(ATR) applications approval in the first
quarter of the year (1Q21), said the Ma-
laysian Aviation Commission (Mavcom).
MyJet Xpress’s affiliates and partners
are Neptune Capital Inc of Malaysia,
Airmark Aviation, My Indo Airlines of
Indonesia.
In a statement today, Mavcom said My-
JET Xpress got half of the 24 ATR approvals
given out for 1Q21, followed by Malaysia
Airlines Bhd (six), AirAsia Group Bhd (four)
and Raya Airways Sdn Bhd (two).
ATR applications in the quarter record-
ed a 100% approval from the commission,
it said. Of the 24 applications, 21 were for
international routes, while the balance
were for domestic routes. ATR applications
were down 51.7% from 43 in 4Q20, but
up 33.33% from the 18 recorded in 1Q20.
No expiration of ATRs was recorded
during the quarter due to the implemen-
tation of measures by the commission to
facilitate the airlines’ administrative and
regulatory challenges during the pandemic,
and to enable them to keep their current
ATR portfolio active.
price more than doubling from 50.5 sen at
end-2020 to its all-time high of RM1.05 on
March 5, which earned it an unusual market
activity query from the bourse regulator.
In response to the UMA, Artroniq said
it had been implementing changes such as
monetising the assets of its manufacturing
business, which had ceased in the third
quarter ended Sept 30, 2020 (3QFY20),
as well as other non-core assets. It was
also exploring options to identify suita-
ble businesses and strategic acquisitions to
expand its business in the distribution of
information and communication technol-
ogy (ICT) products and related activities.
The stock price later trended down-
wards and sank to as low as 37.5 sen on
March 31, before rebounding.
T U E S D AY A P R I L 2 0 , 2 0 2 1 9 THEEDGE CEO MORNING BRIEF
 T U E S D AY A P R I L 2 0 , 2 0 2 1 10 THEEDGE CEO MORNING BRIEF

H O M E

SRC appeal: Najib was entrusted with

dominion over the RM4b, says Sithambaram
BY IZZUL IKRAM & EMIR ZAINUL SUHAIMI YUSUF/THE EDGE
theedgemarkets.com

PUTRAJAYA (April 19): Former prime

minister Datuk Seri Najib Razak was
entrusted with full dominion over SRC
International Sdn Bhd and was there-
fore responsible for the funds totalling
RM4 billion from Retirement Fund Inc
(KWAP), the prosecution submitted
today.
Ad hoc prosecutor Datuk V Sitham-
baram said at the Court of Appeal today
that the former premier was an agent and
a director of SRC, but pointed out that
Najib did not act in the best interest of the
shareholder of SRC, namely the Ministry
of Finance (MoF) Inc, and so by extension
the government of Malaysia.
Court of Appeal judge Justice Datuk
Abdul Karim Abdul Jalil, who led the
three-member bench, posed a question
to the prosecutor on who then had do-
minion over the rest of the funds, if only
RM42 million ended up in Najib’s per-
sonal accounts.
Sithambaram replied that as Najib
was entrusted with dominion over SRC,
therefore the RM4 billion funds were also
his responsibility as they were under his
control.
In his submission, Sithambaram said
Najib had made incremental steps towards
entrenching his position in SRC, entrust-
ing himself with full control of the com-
pany, including its assets.
“SRC was formed with the approval
of the appellant (Najib) and this in turn
allowed his entrustment with dominion
over the assets of SRC since its formation.
“These were deliberate and willful acts
of the appellant,” he added.
The SRC funds of RM4 billion origi-
nated from two separate loans from KWAP
in 2011 and 2012. The funds were ini-
tially intended to be utilised to develop
national energy projects but were instead
transferred out of the country almost im-
mediately after they were disbursed.
Apart from the RM42 million that went
into Najib’s personal accounts, the court
was previously told during this appeal that
“no one knows” what happened to the
rest of it.
The prosecution today outlined that
through the former premier’s instruc-
tions to SRC in the form of shareholder
minutes, it could be seen that Najib had
“enormous influence and an overarch-
ing position of power in SRC”.
Sithambaram said there is no evidence
to prove that this assertion is false, and
that this only fortifies the argument that
the SRC board of directors (BOD) indeed
followed Najib’s signed instructions.
He claimed that it was more evident
that Najib was acting in accordance with
his own interest and not the government
when he himself had signed all the share-
holder instructions that were subsequently
executed by the SRC BOD.
“RM42 million belonging to SRC were
credited into his personal accounts which
he then converted for his own use.
“The appellant (Najib) cannot plead
ignorance of the transactions that had tak-
en place in his accounts to avoid criminal
liability.
“The responsibility for the activities in
the personal accounts of the appellant al-
ways lies with the appellant,” he said.
Sithambaram added that evidence from
both Tan Sri Ismee Ismail and Datuk Sub-
oh Yassin, who were SRC chairman and
director respectively, coincided to show
that Najib had pushed certain articles to
be added into the memorandum and ar-
ticles of association in order to establish
dominion over SRC from its initial for-
mation.
He added that one of these said arti-
cles resulted in the appointment of the
former premier as the advisor emeritus,
prompting the SRC BOD to seek advice
and also implement any advice of the ad-
visor emeritus.
The SRC BOD were also led into fol-
lowing the “advice” from the former pre-
mier, as the memorandum and articles of
association also provided Najib with the
sole authority to hire and fire members
of the board.
Najib’s cocktail of positions provided
him enormous leverage where he could
adapt and act in accordance to a certain
position for his own gain, added the pros-
ecutor.
At the time, Najib held the positions
of prime minister, finance minister cum
corporate representative on behalf of MoF
Inc as the sole shareholder, and advisor
emeritus of SRC.
The hearing continues.
Read also:
SRC appeal: MoF officers had no access
to 1MDB former unit SRC although
MoF Inc owns it Click here
SRC appeal: Court gives two extra days for
prosecution to complete their submissions
Click here
 T U E S D AY A P R I L 2 0 , 2 0 2 1
Magna Prima to dispose of commercial
property in KL for RM56m
KUALA LUMPUR (April 19): Magna Prima
Bhd is selling a four-storey commercial
building in Kuala Lumpur for RM56
million, which the property developer
will use to help settle its debts. It said
the property, located in Mukim Batu and
with its lower ground floor designated
for a supermarket, is being sold by its
wholly-owned unit Everhall (M) Sdn Bhd
to Cowboy (KL) Sdn Bhd. “The disposal
will release resources tied up in unutilized
property and realize the property at a fair
market value whilst enhancing the group’s
working capital,” Magna Prima said in a
filing. A valuation report dated Dec 14 last
year valued the property at RM60 million.
— by Sulhi Khalid/theedgemarkets.com
AmFirst REIT’s 4Q net property income
falls 33.72%, pays 1.42 sen DPU
KUALA LUMPUR (April 19): AmFIRST
Real Estate Investment Trust (AmFIRST
REIT) saw its net property income (NPI) for
the fourth quarter ended March 31, 2021
(4QFY21) fell 33.72% to RM12.55 million
from RM18.93 million a year ago, due to
rental rebates given to tenants, lower
occupancy of Prima 9, as well as lower
monthly rental income from The Summit
Hotel. Quarterly revenue fell 18% to
RM24.56 million from RM29.95 million, its
bourse filing showed. The group declared a
final income distribution per unit (DPU) of
1.42 sen per unit for the six-month period
from Oct 1, 2020 to March 31, 2021, which
will be paid on May 28, 2021. For the full
year ended March 31, 2021 (FY21), the
group’s NPI dropped 16.61% to RM63.85
million from RM76.56 million in FY20,
while revenue fell 11.09% to RM107.3
million from RM120.68 million. — by Tan
Siew Mung/theedgemarkets.com
11 THEEDGE CEO MORNING BRIEF
H O M E
NEWS IN BRIEF
MAHB eyes RM1.3b investment to transform Subang Airport into regional hub
SEPANG (April 19): Malaysia Airports Holdings Bhd (MAHB) is eyeing total investments
of RM1.3 billion for Subang Airport’s (SZB) regeneration development that will transform
it into an aviation hub in Asia Pacific. KLIA Aeropolis Sdn Bhd head Randhill Singh said
RM300 million will be needed for common infrastructures and RM1 billion for building
lettable facilities such as hangers, factories, maintenance, repair, and operations (MRO), as
well as workshops. “It is imperative for Malaysia to consolidate its position as a hub across
these segments, namely business and commercial aviation, helicopter ecosystem, air cargo
and e-commerce logistics, centre of aviation, new technologies, aerospace manufacturing
and MRO in the region. Having one complementary ecosystem between KLIA and Subang
Airport allows us to ensure that we have the leadership position in APAC,” he told a media
briefing today. KLIA Aeropolis is MAHB’s unit tasked to undertake land development for
the airport operator’s network of airports nationwide. The five-year masterplan, which is
expected to be completed by end-2025, will be financed via MAHB’s internal funds and
partnership with industry players. — Bernama
Homeritz shut plants and office in HLT Global to buy 2.55-acre leasehold
Muar for seven days as more workers land in Kuala Langat for RM16.25m
test positive for Covid-19 KUALA LUMPUR (April 19): HLT Global
KUALA LUMPUR (April 19): After a seven- Bhd is buying a 2.55-acre leasehold land
day stoppage at one of its manufacturing in Kuala Langat, Selangor for RM16.25
plants due to Covid-19 infections, Muar- million to boost its glove-dipping production
based Homeritz Corp Bhd today announced capacity. In a bourse filing, the group said
a one-week suspension of operations across it is operating at peak production capacity
all its factories and administrative office. In and hopes the acquisition — a plot close
a bourse filing today, the furniture maker to its existing factory premises — will raise
said the temporary closure is to minimise the its capacity by about 80%. It sees strong
risk of further spreading the virus within the demand for new glove-dipping lines, it said,
community. “The board of directors of the driven by the number of new entrants into
company wishes to inform that further to the the industry in the past year, as well as the
Covid-19 full screening for all its remaining expansion plan embarked on by existing
employees at factories and office located at rubber glove makers. The group intends to
Kawasan Perindustrian Bukit Bakri, Muar, fund the cash buy, expected to be completed
Johor, there are employees who have tested by the third quarter of this year, via internal
positive for Covid-19. Following this, the funds. — by Justin Lim/theedgemarkets.com
operations of these factories as well as its
administrative office are implementing a
temporary stoppage from April 18 to 24,” the
group said. Previously, it halted operations
for one of its manufacturing facilities
from April 13 to 19 following several
cases of Covid-19 infections detected
among its factory workers. — by Justin Lim/
theedgemarkets.com
Company manager loses RM512,000 for purchase of non-existence bauxite AP
KUANTAN (April 19): A company manager lodged a police report claiming to have lost
RM512,000 after being deceived into buying an approved permit (AP) for bauxite that did
not exist. Pahang Commercial Criminal Investigation head Supt Mohd Wazir Mohd Yusof
said the victim, aged 52, claimed he and three partners befriended a man in early 2017
who claimed to be able to get them an AP for bauxite from Kuantan. On Jan 10, 2017, the
victim’s company agreed to buy the AP for RM450,000, and was asked to pay RM10,000
in legal fees. The suspect, aged 31, then asked for RM12,000 for permit renewal and
RM20,000 for bauxite royalty. “The victim claimed he also lost RM20,000 after opening a
new company, as advised by the suspect, to handle the bauxite export business, after one
of his partners disappeared,” Mohd Wazir said in a statement today. The victim lodged
the police report after feeling he had been cheated as he had yet to receive the AP after
waiting for more than three years. — Bernama
 T U E S D AY A P R I L 2 0 , 2 0 2 1
JOHOR BARU (April 19): Johor is hoping
for “positive news” from Prime Minister
Tan Sri MuhyiddinYassin’s meeting with his
Singaporean counterpart Lee Hsien Loong
scheduled for early next month, which is ex-
pected to discuss the reopening of the border
between the two countries.
Johor Menteri Besar Datuk Hasni Mo-
hammad said this is because the reopening
of the border is an ongoing agenda of the
state government and that it would ensure
that those involved in crossing the border
from Johor, like workers, receive the Cov-
id-19 vaccine.
“Therefore, we will also present to the
federal government standard operating pro-
cedures (SOPs) for crossing the border.This
will include limited movement. Although
they can cross the border, it does not mean
that they can travel all over Singapore.
“If if it is for work, it means that they have
to move from Point A to Point B. So, there
will be a mechanism that can be developed
for us to [have] control [of this],” he told a
press conference after attending a Mekar
Kickstart Programme entitled “Child and
Adolescent Crime Awareness Module”, a
collaboration between Universiti Teknolo-
gi Malaysia (UTM) and the Johor police
here today.
Also present were Johor Police Chief Da-
tuk Ayob Khan Mydin Pitchay and UTM
Vice Chancellor Prof Datuk Ts Dr Ahmad
Fauzi Ismail.
He said this when asked to comment on
the level of confidence of the state govern-
ment on reopening the border to the republic
as Covid-19 cases in the country are seen
to be increasing.
On April 12, Foreign Affairs Minister Da-
tuk Seri Hishammuddin Tun Hussein said
the reopening of the border is expected to
be on the agenda of the meeting between
Muhyiddin and Lee early next month.
KUALA TERENGGANU (April 19):
The Ministry of Domestic Trade and
Consumer Affairs (KPDNHEP) today
suggested that more approved permits
(APs) be issued for the import of chicken
to control the price increase.
Deputy Minister Datuk Rosol Wahid
said to ensure this could be implemented,
his ministry will discuss the matter with
the Ministry of Agriculture and Food In-
dustries (MAFI) soonest possible.
“If wholesalers and poultry breeders
are trying to take advantage of the situ-
ation by hiking up the price of chicken,
we can offer [APs] to interested compa-
nies. I believe this problem can be solved
by issuing more APs to import chicken.
“The issuing of APs is a good sugges-
tion and we will discuss the matter with
12 THEEDGE CEO MORNING BRIEF
H O M E
Johor hopes
“At the national level, [according to the
population ratio,] out of 100,000 people,
Malaysia-
about 450 people were found to be involved
in drug abuse, but Mersing recorded about
Singapore
1,050 people [per 100,000].
“We need to do something not only from
meeting next
the education point of view, but also other
factors that influence drug abuse and usage
month will bring
among the younger generation in Mersing,”
he said.
‘positive news’
Ayob Khan said most of those involved in
drug abuse in Mersing are fishermen.
“Most of the drugs used are syabu and
methamphetamine. For fishermen, they may
Bernama use it for strength because they are at sea for
a long time. Our concern is that it involves
Meanwhile, when asked to comment on teenagers, possibly influenced by parents,
the problem of drug abuse, Hasni said that so children also follow,” he said.
based on the latest statistics from the Nation- He said the police had always conducted
al Anti-Drug Agency (AADK), the Mers- operations to eradicate the problem and at the
ing district recorded the highest number of same time explained the importance of the
drug cases involving youths and teenagers Mekar Module developed together with UTM.
in the state. He hoped that it will help provide aware-
He said the situation is worrying and ef- ness to students of the dangers of drug use
forts should be made to address the issue. and involvement in criminal cases.
BERNAMA
Rocketing chicken
He visited the market after receiving
complaints from the public that the price
price: Ministry
of chicken had increased by between 30
and 40 sen since last week, and today it
suggests more
was being sold at RM10 per kilogramme.
Prices of other items like meat and
APs be issued
vegetables were also said to have gone
up and due to this, several traders were
asked to provide information on the pric-
es charged before further action could
Bernama be taken.
Rosol also said that until yesterday, 42
MAFI as the APs for importing chicken notices on chicken price increases had
come under the jurisdiction of MAFI, been issued to 25 wholesalers and 17
not KPDNHEP.” poultry breeders respectively.
Rosol said this when met by reporters
after surveying the prices and supply of
basic necessities at the Chabang Tiga Mar- Read also: Hike in chicken price due to
ket, Kampung Hiliran Jejawi here today. higher feed costs, says Nanta Click here
 T U E S D AY A P R I L 2 0 , 2 0 2 1
JPMorgan backs Super Soccer League
with US$4.8 bil
LONDON/MADRID/MILAN (April 19): JP-
Morgan Chase & Co is bankrolling the biggest
upheaval of European soccer since the 1950s
in a 4 billion-euro (US$4.8 billion) bet that
has already drawn heavy criticism from fans,
domestic leagues and politicians.
The US investment bank agreed to under-
write an initial 3.5-billion-euro investment to
help a group of the world’s richest soccer clubs
set up a top-tier Super League, a figure that
will total 4 billion euros after additional pay-
ments and expenses, according to a person
familiar with the matter.The investment, cur-
rently financed by JPMorgan, may be offered
to investors at a later date, the person added,
asking not to be identified as the discussions
are still private.
Six teams from England, three from Italy
and three from Spain have signed up so far to
play each other midweek in the new league
in a direct challenge to the prestigious UEFA
Champions League. Alongside 15 permanent
teams, another five would qualify to take part
each year.
The clubs have committed to remaining
part of the Super League for a set number of
years, according to people with knowledge of
the agreement.That binding agreement was a
key driver behind JPMorgan’s investment, the
people added. The financing from JPMorgan
has been set at an interest rate of between 2%
and 3%, and set over a 23-year time frame,
one of the people added.
A spokesperson for JPMorgan declined to
comment.The European Super League did not
respond in time for publication.The prospect
of the most profound shakeup to European
soccer since the precursor to the Champions
League was established in 1955, sent shares in
top teams Juventus Football Club S.p.A. and
Manchester United Plc soaring.
The move would free the clubs from games
against smaller teams that bring in lower in-
come, and would award some of them perma-
nent membership, breaking with a principle of
international soccer — that anyone can quali-
fy, or fail to qualify — for the most prestigious
competitions.
The approach has parallels with the US,
where participation in the most lucrative bas-
ketball, baseball and American football compe-
titions is guaranteed for clubs that are already
members. Annual Champions League revenue
is around 3 billion euros (US$3.6 billion), a
fifth of the income of the US National Foot-
ball League.
Quick backlash
The top clubs said they would share part of
13 THEEDGE CEO MORNING BRIEF
W O R L D
BY DAVID HELLIER, RODRIGO ORIHUELA,
DANIELE LEPIDO & FAREED SAHLOUL
Bloomberg
REUTERS
their income from the new competition with
poorer teams. That failed to placate national
leagues from England, Spain and Italy and soc-
cer governing bodies UEFA and FIFA, which
all hit back at the move, threatening the rebels
with legal action and ejection from domestic
leagues.
UEFA said it could ban Super League team
players from national teams that take part in
Euro and World Cup competitions.
Plans for a European Super League would be
very damaging for football and we support football
authorities in taking action.
They would strike at the heart of the domestic
game, and will concern fans across the country.
(1/2) — Boris Johnson (@BorisJohnson) April
18, 2021
Sent via TwitterWeb App
JPMorgan’s links to landmark deals in the
sport stretch back almost 20 years. In 2003,
it advised the American Glazer family on its
purchase of Manchester United FC. It went
on to work on the club’s initial public offering
almost a decade later. Manchester United has
signed up as a founding member of the Super
League, and its vice chairman Ed Woodward
is a former JPMorgan banker.
In recent years, the bank advised Rocco
Commisso, the Italian-American owner of Me-
diacom LLC, on his purchase of Serie A team
ACF Fiorentina, and US billionaire Dan Fried-
kin on his takeover of AS Roma. It has also
helped FC Internazionale Milano and Roma
sell bonds backed by future media revenue, and
Spain’s Real Madrid raise funds to refurbish
its iconic Santiago Bernabeu stadium.
“I’m not surprised that a bank like JPMor-
gan is gearing up its European sports activi-
ty,” said Nikhil Bahel of the sports investment
group Elysian ParkVentures. Bahel said the im-
pact of the Covid-19 pandemic has left many
teams and leagues financially exposed. “There
is a realization here in Europe that the current
financing model for these bodies needs to be
revisited.”
The US investment bank’s role is vital, as it
gives the Super League the financial cover to
put billions of euros in guaranteed broadcast
rights on the line so the clubs can attempt to
earn greater revenues via the new league.
Powerful threat
The idea that the top teams need their perfor-
mance in national competition to affirm their
status and power has come to look like an irrel-
evance, as the wealth gap with domestic peers
gradually widened. Surprise upsets in ties with
bottom-placed rivals have become rarer, help-
ing the bigger clubs’ case that such games can
be a pointless distraction.
That situation is partly one of soccer author-
ities’ own making. In recent years European
governing body UEFA changed the rules of
the Champions League to favor teams from
the big five leagues. And the English Premier
League changed the distribution of overseas
broadcast rights, also giving the big teams an
advantage.
Even if the Super League plan is thwarted
by its opponents, it represents a powerful threat
that could help the clubs win more concessions
from UEFA.
If it does go ahead, it won’t just signal the
diminishing clout of the national leagues. It
would also show how traditional media com-
panies such as Comcast Corp’s Sky and BT
Group Plc — still the industry’s paymasters —
have diminishing power to dictate the shape of
the industry.The super-clubs announced their
plan on Monday, before they’ve even held talks
with national broadcasters.
BT said the move could damage the long-
term health of UK soccer. The company is
among those with most to lose in the short
term, as it holds the current rights to Cham-
pions League broadcasts in the UK.
The breakaway clubs may have been em-
boldened by the possibility of using stream-
ing technology to partly bypass established
broadcasters and show games direct to the
newer, younger and more Asian fan base that’s
emerged in recent years.
Documents outlining the proposal earlier
this year and seen by Bloomberg showed the Su-
per League plans to allow four regular season
games to be shown live on club apps and digital
platforms.This could be a major source of in-
come growth for the teams that are supported
by millions of followers worldwide.
 T U E S D AY A P R I L 2 0 , 2 0 2 1
(April 19): Citigroup Inc. is pushing ahead
to set up new investment banking and trad-
ing operations in China after the lender
announced it would be exiting retail bank-
ing in the world’s second-largest economy.
The NewYork-based bank plans to sub-
mit an application for a securities license
to allow it to underwrite yuan-denominat-
ed shares and conduct trading for clients,
as well as a license for futures brokering
within the next two months, said a person
familiar with the matter, who asked not
to named because the information is con-
fidential. The aim is to get the businesses
up and running in 12 to 18 months, the
person said.
A chief executive officer will soon be
named for the business and 50 people will
be hired initially with a plan to grow to
about 100 over time, the person said. The
bulk will be external hires but it will also
transfer bankers from other mainland busi-
nesses to fill the gap, the person said. The
U.S. bank is a late entrant into China’s
securities market after the country lifted
foreign ownership restrictions and allowed
full control starting last year, as it was in
process of unwinding a venture with Ori-
ent Securities Co.
Foreign banks have aggressive plans to
expand in China — seeking to double or
even triple their staffing — as the country
Renesas says
to restore full
capacity at fire-
damaged chip
plant by end-May
BY TIM KELLY
Reuters
TOKYO (April 19): Renesas Electron-
ics Corp, a major supplier of automotive
semiconductors, said on Monday it plans
to restore lost production capacity at its
fire-damaged plant by end-May after re-
starting production on Saturday.
Renesas restarted the 300mm chip line
at its Naka plant northeast of Tokyo four
weeks after a fire caused by an electricity
overload burned an area of 600 square me-
ters (6,458 square feet), destroyed 23 ma-
chines and filled the sensitive clean room
with smoke and soot.
Half of the Naka plant line’s capacity
should be restored by the end of April, al-
though a ramp up to full production at the
14 THEEDGE CEO MORNING BRIEF
W O R L D
Citi planning new
China investment
bank within 18
months — source
BY CATHY CHAN
Bloomberg
BLOOMBERG
opens its $54 trillion financial market.They
have had limited success over the past dec-
ade with joint ventures, which in many cas-
es have been unprofitable. Goldman Sachs
Group Inc. and JPMorgan Chase & Co. are
vying to become the first Wall Street bank
to achieve full ownership of securities op-
erations on the mainland.
plant will still take around 70 days more,
Renesas Chief Executive Officer Hidetoshi
Shibata told an online press conference.
The production halt was a blow to auto-
makers around the world already struggling
to find enough chips amid surging demand
from consumer electronics makers, forcing
some such as Nissan Motor, Honda Mo-
tor to cut production as demand for cars
was rebounding from a pandemic slump.
Renesas commands nearly a third of the
global market share for microcontroller
chips used in cars.
Global Times earlier reported the com-
pany plans to apply for stock and futures
trading license in China, without giving
details.
The push for a licenses comes as Citi-
group announced plans to exit retail bank-
ing in China and other markets across Asia
and Europe, Middle East and Africa.
The bank continues to explore opportu-
nities to support clients in China, a Hong
Kong-based spokesman said, declining to
comment when asked about the license
and hiring plans.
Citigroup is expanding in wealth man-
agement and last week announced plans to
hire more than 300 relationship managers
in Hong to double its assets by 2025. In
March, it said it would hire up to 1,700
staff in the financial hub as it seeks to tap
growing links between the city and rising
affluence in southern mainland cities such
as Shenzhen.
The bank serves close to 1,000 mul-
tinationals with operations in China and
more than 350 local corporates. It has
raised more than $30 billion for domestic
Chinese clients from global capital markets
in the past 12 months, the spokesman said.
Citigroup received a domestic custody
license last year and already has licenses
to settle and underwrite bonds for clients
in China.
REUTERS
The company is also installing new fire
extinguishing equipment in the factory to
deal with any similar fires in the future,
Shibata said.
The Japanese government has called on
equipment makers to help Renesas restore
production, with industry ministry officials
asking companies at home and overseas to
provide parts and machinery to Renesas.
Read also: HSBC top staff to hot desk after
scrapping executive floor Click here
 T U E S D AY A P R I L 2 0 , 2 0 2 1
BANGKOK (April 19): Gulf Energy De-
velopment Pcl, Thailand’s biggest power
producer by market value, offered to ac-
quire Intouch Holdings Pcl that control’s
the nation’s largest mobile phone operator
for as much as 169 billion baht (US$5.4
billion).
Intouch shares surged the most in more
than two years.
The Bangkok-based company, con-
trolled by billionaire Sarath Ratanavadi,
offered to buy 2.6 billion shares, or about
81% of Intouch, that it doesn’t already
own at 65 baht each, it said in an exchange
filing. The offer price is 11% higher than
Intouch’s close on Friday. While Intouch
shares jumped 7.7% on Monday, the most
at close since January 2019, Gulf Energy
tumbled 1.5% to close at a five-month low.
Gulf Energy will also tender for 100% of
Advanced Info Service Pcl, Thailand’s big-
gest mobile phone company controlled by
Intouch, at 122.86 baht each.The Advanced
Info offering will be subject to Gulf Energy
securing at least 50% of Intouch, it said.
With the acquisition of Intouch, Gulf
Energy may be targeting rising demand
for 5G services as a new source of growth,
according to Danai Tunyaphisitchai, an an-
(April 19): Oaktree Capital Group has pro-
posed funding a A$3 billion ($2.3 billion)
buyback by Australia’s Crown Resorts Ltd
of its founder’s stake, setting up a clash
with rival Blackstone Group for the trou-
bled casino firm’s future.
Private equity giant Oaktree’s offer of
a “structured instrument” to help Crown
buy back James Packer’s 37% stake comes
just a month after Blackstone lobbed an
A$8 billion full takeover offer.
Crown did not specify what Oaktree
would receive under its proposal, which it
said it was considering, along with Black-
stone’s offer.
Billionaire Packer’s status as Crown’s
major shareholder has been under scru-
tiny since an inquiry named his influence
as a factor when it in February declared
the company unfit for a Sydney casino
licence, citing activities including money
laundering.
Oaktree’s approach to removing Packer
from the register would give Crown a way
to resolve regulator concerns without sell-
ing the whole company at a price below
pre-coronavirus levels.
Packer, who left the Crown board in
2018, has indicated he is willing to sell
up his stake and has said he supports the
board’s decision on an exit strategy. Packer
would walk away with around A$3 billion
under either proposal.
Many investors have declined to en-
15 THEEDGE CEO MORNING BRIEF
W O R L D
Thai billionaire
makes US$5.4 bil
bid for telecom
operator
BY ANUCHIT NGUYEN, YOOJUNG LEE
& MAX ZIMMERMAN
Bloomberg
alyst at Phillip Securities (Thailand) Pcl.
Still, the sell-off in Gulf Energy showed
that some investors are concerned about
possible large borrowing to finance the
takeover, he said.
Sarath, 56, Thailand’s second-richest
person, has expanded his 10-year-old en-
ergy company into deep-sea port, tollway
and telecommunication businesses as well
as power projects in Vietnam, Oman and
Germany. Acquisitions of Intouch and Ad-
vanced Info will generate long-term ben-
efits from their potential and cash flows
as Thailand’s leading telecommunication
companies, Gulf Energy said.
Oaktree and
Blackstone
in battle for
Australia’s Crown
BY BYRON KAYE
Reuters
dorse Blackstone’s approach, saying it
undervalues the company, pointing to
Crown’s higher market capitalisation in
early 2020 before the pandemic and reg-
ulatory attention hammered its shares.
Blackstone had a history of buying
casino companies and spinning off their
property assets profitably, and with Oak-
tree’s help there was “no reason Crown
couldn’t copy the strategy and do it them-
selves”, said Nathan Bell, portfolio man-
ager of Intelligent Investor, which has
Crown shares.
Angus Gluskie, managing director of
White Funds Management, which has
Crown shares, questioned the structure
of the Oaktree offer, which limits its expo-
sure but not other shareholders’.
“There is obviously a reason Oaktree
doesn’t want some element of the business
or wants to receive some uplift in the re-
Satellites, E-commerce
“Intouch has a very strong business plat-
form from mobile phones, satellites to
e-commerce that can add value to our en-
ergy and infrastructure business,” Smith
Banomyong, Gulf Energy’s chief of asset
management and investment, told report-
ers. “Digital technology is considered an-
other key infrastructure that all businesses
require now.”
Gulf Energy’s proposed acquisi-
tion of Intouch would be Thailand’s
third-biggest buyout deal, according to
data compiled by Bloomberg. Singapore
Telecommunications Ltd is the biggest
shareholder of Intouch, after acquiring
21% stake from Temasek Holdings Pte
in 2016, while Singtel also owns about
23% of Advanced Info, according to
stock exchange data.
Singtel views its stakes in Intouch and
Advanced Info as strategic investments and
the company believes in the long term out-
look of the business, it said in an exchange
filing. The company is reviewing its strate-
gic options to ensure that shareholders of
Intouch and Advanced Info get full bene-
fit of the intrinsic value of the businesses,
Singtel said.
turn that accrues to them, above and be-
yond the return of a normal shareholder,”
Gluskie said.
Shares of Crown were up 0.5% at
A$11.97 in mid-session trading on Mon-
day, in line with the broader market, but
ahead of Blackstone’s proposed purchase
price of A$11.85 per share.
Oaktree, Blackstone and a represent-
ative for Packer declined to comment on
Monday.
A government-backed inquiry into
Crown’s operations uncovered money
laundering and dealings with tour opera-
tors linked to organised crime.
The subsequent decision by the regu-
lator to withhold Crown’s Sydney gaming
licence was a major blow just ahead of the
scheduled grand opening of the company’s
A$2.2 billion waterside casino, apartment
and hotel tower.
Read also:
Meituan seeks US$10 billion to fight
Alibaba in grocery arena
“Chinese delivery giant Meituan is seeking
about US$10 billion from the sale of new
stock and convertible bonds as it doubles
down on efforts to fight the likes of Alibaba
Group Holding Ltd in newer areas such as
online groceries.”
Click here
 T U E S D AY A P R I L 2 0 , 2 0 2 1
New lithium giant emerges to feed
surging battery demand
(April 19): A planned $3.1 billion merger
of two Australian miners is set to create one
of the world’s biggest producers of lithium
products key to meeting fast-growing glob-
al demand for electric vehicle batteries.
The deal between Orocobre Ltd. and
Galaxy Resources Ltd. is the biggest min-
ing sector deal of the year so far, accord-
ing to Bloomberg data, with shares of both
companies closing at the highest in three
years in Sydney. The merger would create
the world’s fifth-biggest producer of lithi-
um chemicals, the refined form of the raw
materials that are used to make electric
vehicle batteries.
Miners to battery makers have rushed
to secure lithium supply amid expectations
the EV frenzy will create a structural deficit
as soon as this year, and prices are already
roaring back after a three-year slump. Bat-
tery demand is expected to surge tenfold by
2030, according to BloombergNEF, as the
global clean-energy transition accelerates.
The new company “is going to be a
globally relevant player in terms of lithi-
um chemical production,” said Reg Spen-
cer, head of mining research at Canaccord
Genuity Australia Ltd. He said that it could
grow to be number three producer by 2025
if all growth projects go ahead.
The A$4 billion deal values Galaxy at
about A$3.53 a share, a 2.2% discount
to Friday’s close, and has the backing of
both company boards. Orocobre’s Chief
Executive Officer Martin Perez de Solay
will head the new group.
Orocobre will offer 0.569 of its shares
for every Galaxy share and will own 54.2%
of the merged company, with Galaxy hold-
16 THEEDGE CEO MORNING BRIEF
W O R L D
BY JAMES THORNHILL formally named, will have its headquar-
Bloomberg ters in Buenos Aires, but its primary share
listing will remain in Australia.
BLOOMBERG The deal gives the companies a geo-
graphically diversified set of assets. Oro-
cobre sells lithium carbonate from its
Olaroz operation in Argentina, while Gal-
axy has a mine in Australia and growth
projects in Canada and South America.
Lithium raw materials are most com-
monly extracted at brine operations
which pump liquid from underground
reservoirs into vast evaporation ponds,
or in traditional hard rock mines. Chi-
na is the biggest player in electric ve-
hicle batteries, with the majority of the
world’s production capacity, and has a
stranglehold over processing of the re-
quired commodities.
Miners to battery The growth profile of the combined
makers have rushed group’s existing assets put it on track to
to secure lithium grab a 10% share of the lithium market
supply amid over the next five to seven years, Perez
expectations the EV de Solay said in an interview, backed by
“a strong balance sheet that will enable
frenzy will create a us not only to deliver those projects but
structural deficit as to continue to grow.” Top global lithi-
soon as this year. um producers currently include Socie-
dad Quimica y Minera de Chile SA and
Albemarle Corp.
ing 45.8%. Orocobre was advised on the Argentina risk
deal by UBS AG, while Galaxy’s advis- Canaccord’s Spencer said there were risks
er was Standard Chartered Plc. The deal in having the largest part of an operation in
is targeted for completion in mid August Argentina, given its history of geo-political
2021. and financial volatility, although Oroco-
bre’s local management team had so far
Diverse assets proven adept at navigating those risks.
The merged group, which has yet to be “From Galaxy’s perspective, we were
looking for a partner which had deep
in-country Argentinian experience and
we’ve got that in Orocobre,” said Simon
Hay, Galaxy’s CEO, who will take on the
role of president of international business
in the new organization. The merger will
help to de-risk Galaxy’s Sal de Vida growth
project in the South American country,
he said.
Read also:
Baidu expects to supply self-driving
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 T U E S D AY A P R I L 2 0 , 2 0 2 1
Danske CEO bows out over Dutch ABN
money laundering inquiry
AMSTERDAM/COPENHAGEN (April
19): Danske Bank’s chief executive officer
(CEO) Chris Vogelzang, who was hired
to help it recover from a multibillion-dol-
lar money laundering scandal, resigned on
Monday after Dutch authorities labelled him
as a suspect in a separate case at ABN Amro.
Vogelzang said he was quitting after the
Dutch prosecution service said it was in-
vestigating three former board members
at ABN. The Dutch bank also said it had
reached a €480 million (US$577 million)
settlement over systematic failures to tackle
money laundering.
“I am very surprised by the decision
by the Dutch authorities,” Vogelzang said,
adding his status as a suspect did not imply
that he would be charged.
Vogelzang joins a growing list of Euro-
pean bank CEOs to depart over the past
18 months. Italy’s UniCredit, Swiss banks
UBS and Credit Suisse, Germany’s Com-
merzbank, and Britain’s Lloyds Banking
Group have all announced leadership
changes since the start of 2020.
And Danske’s former CEO, Thomas
Borgen, stepped down in September 2018,
also over money laundering missteps.
Prosecutors in the Netherlands are inves-
tigating the failure of bank boards to catch
illicit money trails, targeting executives who
have since landed top jobs elsewhere.
While the prosecutors did not name
the three individuals, they said they had
been identified as suspects “effectively re-
sponsible” for breaking the Dutch money
laundering act.
ABN’s former CEO Gerrit Zalm, a
long-time Dutch finance minister, also
stepped down from the board of Den-
mark’s largest bank and confirmed to
Dutch broadcaster NOS that he was one
of the individuals being targeted.
The investigation into anti-money laun-
dering failures at ABN began a year after
fellow Dutch bank ING paid a record fine
of €775 million to settle a similar case.
Although the ING settlement stated
that no managers would be prosecuted, a
Dutch court in December ordered a crim-
inal investigation into the role of former
ING CEO Ralph Hamers, who is now the
top executive at Swiss bank UBS.
Hamers has said in media interviews
he always acted in good conscience during
10 years at ING and that he is confident
that the case will “turn out well”, while
UBS chairman Axel Weber said he has “full
confidence” in his ability to lead the bank.
17 THEEDGE CEO MORNING BRIEF
W O R L D
BY ANTHONY DEUTSCH &
NIKOLAJ SKYDSGAARD
Reuters
Vogelzang joins
a growing list of
European bank CEOs
to depart over the
past 18 months.
BLOOMBERG
Chris Vogelzang
“Given the special situation Danske
Bank is in and the intense scrutiny the
bank is under... I do not want speculations
about my person to get in the way of the
continued development of Danske Bank,”
Vogelzang said in a statement.
Danske is still under investigation in
several countries, including the United
States, over some €200 billion (US$246
billion) of suspicious transactions that
passed through the bank’s tiny Estonian
branch between 2007 and 2015.
DutchmanVogelzang, who took the helm
of Danske in June 2019 with a mandate to
steer it through the money laundering affair,
will be replaced by Carsten Egeriis.
“It is super unfortunate that it’s once
again money laundering that this is re-
lated to. It’s almost embarrassing,” Jyske
Bank analyst Anders Haulund Vollesen
told Reuters.
While Vogelzang has made strides in
cleaning up Danske, he would “not get to
see the fruits of his labour”, Haulund said.
Analysts viewed Danske’s choice of
Egeriis, 44, as a safe bet based on his ex-
perience within compliance and risk.
Egeriis joined Danske in 2017 as head
of risk management after working for more
than a decade within credit risk at Barclays
in London, indicating Danske “will take
no chances”, Sydbank analyst Mikkel Emil
Jensen said.
Denmark’s financial watchdog has told
Danske it expects to approve him as new
CEO.
“Danske Bank works to underline,
that there can be no doubt that anyone
there is anything but absolutely clean,” Per
Hansen, investment economist at Nord-
net, told Reuters.
Egeriis told Reuters he regretted Vog-
elzang’s exit and that he plans to pursue
his predecessor’s strategy.
Billions laundered
In the Netherlands, several inquiries have
been looking into suspected money laun-
dering, with investigators estimating some
€13 billion was laundered each year between
2004 and 2014, a sum equivalent to roughly
2% of Dutch gross domestic product.
ABN, which was bailed out during the
financial crisis and is 56%-owned by the
Dutch state, said it had agreed to pay a fine
of €300 million and €180 million as disgorge-
ment reflecting “the seriousness, scope, and
duration of the identified shortcomings”.
Prosecutors in September 2019 alleged
it failed to spot accounts involved in money
laundering, end relations with suspicious
clients, and report such transactions.
While the bank failed as a whole as a
gatekeeper, three former executives “pre-
sumably are effectively responsible for the
violation of the Anti-Money Laundering
and Counter Terrorism Financing Act”,
prosecutors said in a statement.
Although the executives are suspects,
“this does not necessarily entail that they
will be prosecuted”, they added.
Among examples cited by prosecutors
was an ABN client with the lowest risk clas-
sification, who opened 192 bank accounts
for 49 companies between 2014 and 2018.
The client committed fiscal fraud, receiv-
ing almost €200,000 from tax authorities,
which was transferred and withdrawn.
Since ING’s fine, leading Dutch banks
have invested heavily in increasing their
capacity to detect money laundering.
“This settlement marks the end of a
painful and disappointing episode for ABN
Amro,” its CEO Robert Swaak said.
ABN has dedicated more than 3,000
new employees to regulatory monitoring,
adding staff for the first time after years
of job cuts.
 T U E S D AY A P R I L 2 0 , 2 0 2 1
Historic oil glut amassed during
pandemic has almost gone
BY GRANT SMITH & JULIAN LEE
Bloomberg
(April 19): The unprecedented oil invento-
ry glut that amassed during the coronavirus
pandemic is almost gone, underpinning a
price recovery that’s rescuing producers but
vexing consumers.
Barely a fifth of the surplus that flooded
into the storage tanks of developed econ-
omies when oil demand crashed last year
remained as of February, according to the
International Energy Agency. Since then, the
lingering remnants have been whittled away
as supplies hoarded at sea plunge and a key
depot in South Africa is depleted.
The re-balancing comes as OPEC and
its allies keep vast swathes of production
off-line and a tentative economic recovery
rekindles global fuel demand. It’s propping
international crude prices near $67 a barrel,
a boon for producers yet an increasing con-
cern for motorists and governments wary
of inflation.
“Commercial oil inventories across the
OECD are already back down to their five-
year average,” said Ed Morse, head of com-
modities research at Citigroup Inc. “What’s
left of the surplus is almost entirely concen-
trated in China, which has been building a
permanent petroleum reserve.”
The process isn’t quite complete. A con-
siderable overhang appears to remain off
the coast of China’s Shandong province,
though this may have accumulated to feed
new refineries, according to consultants IHS
Markit Ltd.
Working off the remainder of the global
excess may take some more time, as OPEC+
is reviving some halted supplies and new
virus outbreaks in India and Brazil threat-
en demand.
Still, the end of the glut at least appears
to be in sight.
Oil inventories in developed economies
stood just 57 million barrels above their
2015-2019 average as of February, down
from a peak of 249 million in July, the IEA
estimates.
It’s a stark turnaround from a year ago,
when lockdowns crushed world fuel demand
by 20% and trading giant Gunvor Group
Ltd. fretted that storage space for oil would
soon run out.
Stockpile slump
In the U.S., the inventory pile-up has effec-
tively cleared already.
Total stockpiles of crude and products
18 THEEDGE CEO MORNING BRIEF
W O R L D
subsided in late February to 1.28 billion
barrels — a level seen before coronavirus
erupted — and continue to hover there, ac-
cording to the Energy Information Admin-
istration. Last week, stockpiles in the East
Coast fell to their lowest in at least 30 years.
“We’re starting to see refinery runs pick
up in the U.S., which will be good for po-
tential crude stock draws,” said Mercedes
McKay, a senior analyst at consultants FGE.
There have also been declines inside the
nation’s Strategic Petroleum Reserve, the
warren of salt caverns used to store oil for
emergency use. Traders and oil companies
were allowed to temporarily park oversupply
there by former President Trump, and in re-
cent months have quietly removed about 21
million barrels from the location, according
to people familiar with the matter.
The oil surplus that gathered on the
world’s seas is also diminishing. Ships were
turned into makeshift floating depots when
onshore facilities grew scarce last year, but
the volumes have plunged, according to IHS
Markit Ltd.
They’ve tumbled about by 27% in the
past two weeks to 50.7 million barrels, the
lowest in a year, IHS analystsYen Ling Song
and Fotios Katsoulas estimate.
A particularly vivid symbol is the drain-
ing of crude storage tanks at the logistical-
ly-critical Saldanha Bay hub on the west
coast of South Africa. It’s a popular location
for traders, allowing them the flexibility to
quickly send cargoes to different geograph-
ical markets.
Inventories at the terminal are set to fall
to 24.5 million barrels, the lowest in a year,
according to ship tracking data monitored
by Bloomberg.
For the 23-nation OPEC+ coalition led
by Saudi Arabia and Russia, the decline is a
vindication of the bold strategy they adopted
a year ago. The alliance slashed output by
10 million barrels a day last April — rough-
ly 10% of global supplies — and is now in
the process of carefully restoring some of
the halted barrels.
The Organization of Petroleum Export-
ing Countries has consistently said its key
objective is to normalize swollen inventories,
though it’s unclear whether the cartel will
open the taps once that’s achieved. In the
past, the lure of high prices has prompted
the group to keep production tight even af-
ter reaching its stockpile target.
Mixed blessing
To consuming nations the great de-stocking
is less of a blessing. Drivers in California are
already reckoning with paying almost US$4
for a gallon of gasoline, data from the AAA
auto club shows. India, a major importer,
has complained about the financial pain of
resurgent prices.
For better or worse, the re-balancing
should continue. As demand picks up fur-
ther, global inventories will decline at a rate
of 2.2 million barrels a day in the second
half, propelling Brent crude to US$74 a
barrel or even higher, Citigroup predicts.
“Gasoline sales are ripping in the U.S.,”
said Morse. “Demand across all products
will hit record levels in the third quarter,
pushed up by demand for transport fuels
and petrochemical feed-stocks.”
Read also: Banks face growing pressure to
phase out fossil-fuel lending Click here
 T U E S D AY A P R I L 2 0 , 2 0 2 1
The ‘metaverse’ bet: Crypto-rich investors
snap up virtual real estate
BY ELIZABETH HOWCROFT
Reuters
(April 19): What do you do with a $69 mil-
lion artwork that doesn’t physically exist?
That’s the question faced by the Singa-
pore-based investor calling himself Metak-
ovan, who made headlines last month when
he bought the digital artwork “Everydays:
The First 5000 Days” by the American
artist Beeple at Christie’s.
The work is a non-fungible token (NFT)
— a new type of virtual asset that has its
ownership status and authenticity verified
by blockchain. NFTs have exploded in pop-
ularity in 2021, with prices skyrocketing.
Metakovan, real name Vignesh Sundare-
san, plans to put the artwork on display in
four virtual world environments. He is work-
ing with architects to design gallery complex-
es that the public can enter via web browsers
or virtual reality technology.
But art is just one part of a new economy
of blockchain-based virtual worlds where
land, buildings, avatars and even names can
be bought and sold as NFTs, often fetching
hundreds of thousands of dollars. In these
environments, referred to as the metaverse,
people can wander around with friends, visit
virtual buildings and attend virtual events.
Metakovan’s plans are an ambitious un-
dertaking, but he says he is the world’s big-
gest NFT investor. His collection of NFTs
and other crypto assets, the Metapurse fund,
is valued at $189 million, according to Non-
Fungible.com, a site that aggregates sales
history data from NFT marketplaces.
“The current Cambrian explosion of
NFTs that you see is all about acquisition
— people want to buy up NFTs, gobble as
many of them as they can,” said Anand Ven-
kateswaran, aka Twobadour, who runs the
Metapurse fund with Metakovan.
“But it’s just the tip of the iceberg. The
real explosion will happen when they’re
able to ... experience these NFTs as they
were intended. If it’s a plot of virtual land,
you ought to move around in it, have an
immersive experience in it.”
In what will be one of the biggest names
to join the party, videogame maker Atari
told Reuters it planned to launch its own
blockchain-based virtual world and would
soon announce details.
Online environments are going to be
“very very big”, regardless of fluctua-
tions in the price of bitcoin, said Frederic
Chesnais, head of Atari’s blockchain divi-
sion and the company’s former CEO. NFT
19 THEEDGE CEO MORNING BRIEF
W O R L D
Metakovan, real name Vignesh Sundaresan, plans to put the artwork on display in four virtual world
environments. He is working with architects to design gallery complexes that the public can enter via
web browsers or virtual reality technology.
Art is just one part
of a new economy
of blockchain-based
virtual worlds where
land, buildings,
avatars and even
names can be bought
and sold as NFTs.
real estate could one day fetch millions of
dollars, he added.
Investors caution, however, that while
big money is flowing into NFTs, the mar-
ket could represent a price bubble, with the
risk of major losses if the hype dies down.
There could also be prime opportunities
for fraudsters in a market where many par-
ticipants operate under pseudonyms.
A plot of virtual land: $500k+
The NFT frenzy has heightened interest in
blockchain-based online environments.The
best known are Decentraland, Cryptovoxels,
Somnium Space and The Sandbox, where
virtual real estate prices are hitting new highs.
Decentraland has seen more than $50
million in total sales, including land, avatars,
usernames and wearables like virtual outfits.
A patch of land measuring 41,216 virtual
REUTERS
square metres sold for $572,000 on April
11, which the platform said was a record.
Another Decentraland plot sold for
$283,567 on March 21, according to Non-
Fungible.com, while Somnium Space said
an estate on its platform fetched more than
$500,000 on March 16.
Metaverse enthusiasts compare the rush
to buy virtual land to the scramble for do-
main names in the early days of the inter-
net. There are currently a few thousand
unique landowners on each of the main
blockchain-based platforms.
Their theory is that as more people con-
gregate in these environments, plots of land
in central locations will be highly sought-af-
ter because of the amount of visitor traffic.
“All of virtual land and these virtual spac-
es are basically real estate on which experi-
ences will start to centre, on which attention
will start to focus,” Twobadour said.
“That’s where all of the attention is and
that’s monetisable in a million different
ways.”
So far, it’s a relatively small number
of people driving up land prices on these
worlds.
In Decentraland there were 334 buyers
in March, sending monthly land sales vol-
umes past $4 million, from $767,400 in
February with 184 buyers and $246,134
in January with 111 buyers, according to
NonFungible.com.
CO N TI N U ES O N PAG E 20
 T U E S D AY A P R I L 2 0 , 2 0 2 1
LONDON (April 19): Britain stepped up
efforts on Monday to look at the case for a
digital pound in response to the challenge
posed by cryptocurencies such as bitcoin,
and outlined plans to make its financial
market more attractive after Brexit.
“We’re launching a new taskforce be-
tween the Treasury and the Bank of Eng-
land to coordinate exploratory work on
a potential central bank digital currency
(CBDC),” Britain’s finance minister Ri-
shi Sunak told a financial industry con-
ference.
“Alongside this we will set up a new
financial market infrastructure ‘sandbox’
for firms innovating with technologies
like distributed ledger technologies,” he
added.
The BoE said that it and the govern-
ment had not yet made a decision on
whether to introduce a CBDC in the
UK, and that it would engage widely
with stakeholders on the benefits, risks
and practicalities of doing so.
Any digital currency would be de-
signed to exist alongside physical cash
and existing bank deposits, rather than
to replace them, the central bank said.
The taskforce will monitor develop-
ments overseas to ensure the UK remains
at the forefront of global innovation on
digital currencies, it added.
FROM PAG E 19
An NFT investor called Whale Shark,
whose collection was valued at more than
$20 million by NonFungible.com in Febru-
ary, said he spent 200 of the cryptocurrency
Ether on land in Cryptovoxels and anoth-
er 200 in The Sandbox in 2018 and 2019.
Those estates cost around $60,000 each
back then but are now worth more than
$400,000 apiece, he added, speaking on
condition of anonymity.
Some virtual worlds have their own
cryptocurrencies: Decentraland’s MANA
has skyrocketed more than 3500% over the
past year, according to Coinbase.
Virtual festival, anyone?
Some early virtual land investors who
bought in early are now selling to compa-
nies, said Samuel Hamilton, community and
events lead at the Decentraland Foundation.
Atari, ahead of its plans to open its own
blockchain-based world, has licensed a retro
arcade within Decentraland and is due to
open a casino, while an area called “Crypto
Valley” is home to various crypto companies.
Decentraland has hosted a virtual fash-
ion exhibition in collaboration with Adidas,
where designs were auctioned as NFTs. It
is also attracting interest from musicians
who can perform in the space, selling tick-
20 THEEDGE CEO MORNING BRIEF
W O R L D
Britain to
look closer at
creating digital
currency
BY DAVID MILLIKEN & HUW JONES
Reuters
REUTERS
China is a front-runner to launch a
CBDC, which could help authorities
modernise financial systems, meet the
threat from cryptocurrencies and speed
up domestic and international payments.
ets and merchandise as NFTs.
“We’re going to have several well-known
global festivals all doing stages, and when
we get to that point we expect hundreds
of thousands or even millions of people,”
Hamilton said.
Last year, American rapper Travis Scott
drew an audience of 27.7 million visitors
to five concerts within Fortnite, the pop-
ular online game owned by Epic Games.
Is ‘crypto winter’ coming?
Sebastien Borget, co-founder of The
Sandbox, described the commercial ac-
tivity within virtual worlds as a new nation
forming and said the NFT-based economy
would outgrow the real-world one within
a decade.
There are, however, many in the fledg-
ling industry who warn of dangers ahead
for investors.
“I expect that there’ll be a crypto winter
in the next couple of months, the whole
NFT boom will explode and then all the
value will absolutely collapse,” said Ben
Nolan, founder of the virtual world Cryp-
tovoxels.
“Doing NFTs as an investment or as a
way to make money is really ill-advised.”
However he does see a future for virtual
worlds and NFTs.
Last week, the European Central Bank
said it was studying an electronic form of
cash to complement banknotes and coins
but any launch was still several years away.
Dark trading
Since Britain’s departure from the Europe-
an Union’s orbit on Dec. 31, the financial
sector has faced restrictions on serving EU
customers, and the British government is
seeking to make London a more attractive
global financial centre.
The government will propose removing
restrictions inherited from the EU, includ-
ing on who can trade shares in London and
the double volume cap.
This would help Britain attract more
“dark” or anonymous trading by big in-
vestors after Amsterdam toppled London
as Europe’s top share trading centre in
January.
“The consultation process aims to deliv-
er a rulebook that is fair, outcomes-based
and supports competitiveness, whilst en-
suring the UK maintains the highest reg-
ulatory standards,” Sunak said.
Britain will also propose changes to pro-
spectuses, a document companies must
publish when listing on an exchange or
issuing new shares.
The aim would be to ensure the rules
are “not overly burdensome”, Sunak said.
“Do I think most people will use virtu-
al worlds? Probably not, but I think a lot
of people will and I think NFTs are a big
part of that growth,” he said.
“Actually walking around with another
person in a virtual space and looking at
art together is a really nice way to spend
time,” he added.
Whale Shark said the vast majority of
NFTs had no commercial viability, and
expects only a small number to emerge
as winners.
But some investors such as Austral-
ia-based Mateen Soudagar, aka DCL Blog-
ger, have little interest in moving back into
real-world investments.
Soudagar says he has made millions of
dollars through cryptocurrency and NFTs,
but rather than cash out, he keeps around
75% of his money in crypto assets and
reckons many of his peers do the same.
Other than upgrading his laptop, he hasn’t
changed his lifestyle.
“If you’re a believer in the movement
then you think that the world will move
into this space,” he said. “So when you’re
putting it into fiat you’re going backwards.”
Read also: Why is Bitcoin tumbling and
what is the outlook for prices? Click here
 T U E S D AY A P R I L 2 0 , 2 0 2 1
M A R K E T S
CPO RM 3,698.00-18.00 OIL US$ 66.67-0.10 RM/USD 4.1240 RM/SGD 3.0985 RM/AUD 3.2082 RM/GBP 5.7231 RM/EUR 4.9594
Top 20 active stocks
NAME VOLUME CHANGE CLOSE YTD MARKET
(MIL) (RM) CHANGE CAP
(%) (RM MIL)
MINDA GLOBAL BHD 447.1 0.015 0.170 183.33 224.7
FOCUS DYNAMICS GROUP BHD 419.4 -0.025 0.125 -80.77 787.3
UCREST BHD 323.9 0.085 0.435 180.65 266.3
SEDANIA INNOVATOR BHD 313.4 0.245 0.400 175.86 120.9
KEY ASIC BHD 309.5 0.025 0.175 118.75 207.3
SASBADI HOLDINGS BHD 258.9 0.050 0.205 36.67 85.9
DATAPREP HOLDINGS BHD 142.4 0.460 2.000 1011.11 1234.6
BINA PURI HOLDINGS BHD 99.1 0.005 0.095 -13.64 109.1
MACPIE BHD 91.0 -0.010 0.080 -66.32 75.7
MESTRON HOLDINGS BHD 89.2 0.030 0.340 54.55 308.3
BERJAYA CORP BHD 81.3 -0.030 0.350 84.21 1750.7
DAGANG NEXCHANGE BHD 80.2 -0.010 0.800 255.56 1863.8
PUC BHD 77.4 0.030 0.125 -21.88 111.1
FINTEC GLOBAL BHD 68.6 -0.005 0.045 -43.75 155.0
SERSOL BHD 66.3 0.045 0.300 53.85 64.6
QES GROUP BHD 66.1 0.025 0.630 113.56 525.5
RUBBEREX CORP M BHD 64.6 0.000 1.470 5.00 1219.3
HB GLOBAL LTD 63.2 0.030 0.305 110.34 171.3
TRIVE PROPERTY GROUP BHD 61.2 0.000 0.085 -37.33 89.5
JAG BHD 58.6 0.045 0.475 75.93 244.5
Data as compiled on Apr 19, 2021 Source: Bloomberg
Top gainers (ranked by %)
NAME CLOSE CHANGE VOLUME YTD MARKET
(%) (‘000) CHANGE CAP
(%) (RM MIL)
SEDANIA INNOVATOR BHD 0.400 158.06 313424.8 175.86 120.9
SASBADI HOLDINGS BHD 0.205 32.26 258894.7 36.67 85.9
PUC BHD 0.125 31.58 77365.5 -21.88 111.1
DATAPREP HOLDINGS BHD 2.000 29.87 142394.7 1011.11 1234.6
COMPUGATES HOLDINGS BHD 0.025 25.00 418.7 25.00 76.7
UCREST BHD 0.435 24.29 323887.3 180.65 266.3
PERAK CORP BHD 0.470 22.08 1130.7 38.24 47.0
CENSOF HOLDINGS BHD 0.380 20.63 27290.9 43.40 209.9
SERSOL BHD 0.300 17.65 66298.7 53.85 64.6
SEALINK INTERNATIONAL BHD 0.370 17.46 50470.2 94.74 185.0
INNOPRISE PLANTATIONS BHD 1.250 16.82 3609.9 6.84 598.6
KEY ASIC BHD 0.175 16.67 309501.8 118.75 207.3
GRAND CENTRAL ENTERPRISES BHD 0.390 16.42 4.5 4.00 76.8
SC ESTATE BUILDER BHD 0.110 15.79 14215.3 83.33 114.2
KEY ALLIANCE GROUP BHD 0.040 14.29 5332.2 -20.00 94.2
NATIONWIDE EXPRESS HOLDINGS 0.235 11.90 1809.9 -38.16 29.0
GOLDEN PHAROS BHD 0.245 11.36 992.7 0.00 33.8
M3 TECHNOLOGIES ASIA BHD 0.050 11.11 25212.9 -23.08 38.6
COMPLETE LOGISTIC SERVICES BHD 1.410 11.02 5083.8 101.43 181.4
HB GLOBAL LTD 0.305 10.91 63165.2 110.34 171.3
Data as compiled on Apr 19, 2021 Source: Bloomberg
Top gainers (ranked by RM)
NAME CLOSE CHANGE VOLUME YTD MARKET
(RM) (‘000) CHANGE CAP
(%) (RM MIL)
BRITISH AMERICAN TOBACCO 14.400 0.600 1747.9 2.27 4111.6
DATAPREP HOLDINGS BHD 2.000 0.460 142394.7 1011.11 1234.6
BLD PLANTATION BHD 9.500 0.300 4.3 14.46 888.3
SEDANIA INNOVATOR BHD 0.400 0.245 313424.8 175.86 120.9
LOTTE CHEMICAL TITAN HOLDING 2.730 0.210 19475.0 -1.44 6205.2
KESM INDUSTRIES BHD 12.300 0.200 31.9 -9.43 529.1
INNOPRISE PLANTATIONS BHD 1.250 0.180 3609.9 6.84 598.6
GREATECH TECHNOLOGY BHD 6.120 0.170 3295.3 34.51 7662.2
FRASER & NEAVE HOLDINGS BHD 30.160 0.160 16.5 -5.99 11062.0
TIME DOTCOM BHD 13.860 0.140 182.4 6.11 8381.3
COMPLETE LOGISTIC SERVICES 1.410 0.140 5083.8 101.43 181.4
SUPERMAX CORP BHD 5.440 0.130 46864.0 -9.48 14240.0
CHEETAH HOLDINGS BHD 1.670 0.130 3665.6 227.45 191.8
PANASONIC MANUFACTURING 31.500 0.100 2.3 2.27 1913.5
TONG HERR RESOURCES BHD 2.790 0.100 82.2 19.74 428.3
CHIN WELL HOLDINGS BHD 1.360 0.100 796.4 21.43 391.6
UMW HOLDINGS BHD 3.390 0.100 662.8 -0.29 3960.5
ANCOM BHD 1.480 0.100 2131.5 45.10 357.8
AJINOMOTO MALAYSIA BHD 16.000 0.100 11.9 -0.12 972.8
GETS GLOBAL BHD 2.510 0.100 614.6 22.44 712.8
Data as compiled on Apr 19, 2021 Source: Bloomberg
21 THEEDGE CEO MORNING BRIEF
World equity indices
CLOSE CHANGE CHANGE CLOSE CHANGE CHANGE
(%) (%)
DOW JONES 34,200.67 164.68 0.48 INDONESIA 6,052.54 -33.72 -0.55
S&P 500 4,185.47 15.05 0.36 JAPAN 29,685.37 2.00 0.01
NASDAQ 100 14,041.91 15.72 0.11 KOREA 3,198.84 0.22 0.01
FTSE 100 7,028.80 9.27 0.13 PHILIPPINES 6,459.76 -35.05 -0.54
AUSTRALIA 7,065.64 2.18 0.03 SINGAPORE 3,212.62 10.86 0.34
CHINA 3,477.55 50.93 1.49 TAIWAN 17,263.28 104.47 0.61
HONG KONG 29,106.15 136.44 0.47 THAILAND 1,572.78 23.82 1.54
INDIA 47,788.11 -1043.92 -2.14 VIETNAM 1,260.58 21.87 1.77
Data as compiled on Apr 19, 2021 Source: Bloomberg
Top losers (ranked by %)
NAME CLOSE CHANGE VOLUME YTD MARKET
(%) (‘000) CHANGE CAP
(%) (RM MIL)
EDUSPEC HOLDINGS BHD 0.015 -25.00 2079.2 -25.00 33.4
MTOUCHE TECHNOLOGY BHD 0.020 -20.00 25797.9 -73.33 26.5
PRICEWORTH INTERNATIONAL BHD 0.020 -20.00 1531.9 -33.33 90.1
DAYA MATERIALS BHD 0.020 -20.00 15709.5 33.33 40.9
FOCUS DYNAMICS GROUP BHD 0.125 -16.67 419392.4 -80.77 787.3
VSOLAR GROUP BHD 0.025 -16.67 3488.4 -37.50 70.5
THETA EDGE BHD 0.750 -15.25 2879.5 -1.96 80.4
TALAM TRANSFORM BHD 0.030 -14.29 335.3 0.00 128.9
TIGER SYNERGY BHD 0.065 -13.33 31276.7 -45.83 95.5
MLABS SYSTEMS BHD 0.035 -12.50 2360.1 -56.25 42.1
NEXGRAM HOLDINGS BHD 0.040 -11.11 7040.7 -11.11 110.2
MNC WIRELESS BHD 0.040 -11.11 663.3 -11.11 70.4
AIRASIA X BHD 0.080 -11.11 37628.5 6.67 331.9
MACPIE BHD 0.080 -11.11 91015.0 -66.32 75.7
SCOMI ENERGY SERVICES BHD 0.090 -10.00 1355.3 -5.26 42.1
FINTEC GLOBAL BHD 0.045 -10.00 68581.9 -43.75 155.0
KERJAYA PROSPEK PROPERTY BHD 1.110 -9.76 14874.9 42.31 444.2
SENTORIA GROUP BHD 0.185 -9.76 3445.2 32.14 103.2
BERJAYA LAND BHD 0.290 -9.38 15306.4 52.63 1426.9
JADI IMAGING HOLDINGS BHD 0.105 -8.7 10403.3 0 110.5
Data as compiled on Apr 19, 2021 Source: Bloomberg
Top losers (ranked by RM)
NAME CLOSE CHANGE VOLUME YTD MARKET
(RM) (‘000) CHANGE CAP
(%) (RM MIL)
MALAYSIAN PACIFIC INDUSTRIES 39.080 -0.500 59.1 50.54 7772.9
KUALA LUMPUR KEPONG BHD 21.900 -0.260 303.1 -7.52 23620.3
PETRONAS DAGANGAN BHD 20.020 -0.240 103.7 -6.45 19888.9
CARLSBERG BREWERY MALAYSIA 22.880 -0.220 174.7 -1.55 6995.5
NESTLE MALAYSIA BHD 136.300 -0.200 9.6 -1.87 31962.4
AEON CREDIT SERVICE M BHD 12.740 -0.160 20.0 6.17 3252.6
MALAYSIA AIRPORTS HOLDINGS 6.180 -0.150 1562.4 4.39 10253.8
MISC BHD 6.680 -0.140 1707.4 -2.77 29817.8
THETA EDGE BHD 0.750 -0.135 2879.5 -1.96 80.4
UWC BHD 6.140 -0.130 2072.8 25.31 6757.9
GENTING BHD 4.760 -0.120 16333.0 8.52 18328.7
HAP SENG CONSOLIDATED BHD 8.150 -0.120 128.1 -5.23 20290.8
KERJAYA PROSPEK PROPERTY BHD 1.110 -0.120 14874.9 42.31 444.2
ORIENTAL INTEREST BHD 2.600 -0.120 10.5 35.42 402.6
7-ELEVEN MALAYSIA HOLDINGS 1.500 -0.110 292.8 10.29 1689.5
TOP GLOVE CORP BHD 5.460 -0.110 38332.2 -10.78 43702.3
IJM CORP BHD 1.910 -0.100 8309.5 10.40 6906.2
MEGA FIRST CORP BHD 7.070 -0.100 614.3 2.46 3348.9
DUTCH LADY MILK INDUSTRIES 35.380 -0.100 2.2 -5.65 2264.3
ALLIANZ MALAYSIA BHD 13.3 -0.1 90.3 -10.01 2356.3
Data as compiled on Apr 19, 2021 Source: Bloomberg
wealth
M A L AY S I A | A P R I L 1 9 , 2 0 2 1

2021
Presented by

Resilience
in adversity
 W2
APRIL 19
2021
Foreword
A
the Covid-19 pandemic heightened and what started as a health
crisis quickly snowballed into an economic one, the worst of times
seemed inevitable.
But in a year of multiple black swans, the fund management in-
dustry has shown great resilience, thanks to global monetary easing
which brought about a big turnaround in equity markets. More im-
Winners list
EDITORIAL
EDITOR-IN-CHIEF
AZAM ARIS
MANAGING EDITOR
ANNA TAING
EDITORS
KUEK SER KWANG ZHE,
JENNIFER JACOBS
ASSISTANT EDITOR
PATHMA SUBRAMANIAM
SENIOR WRITERS
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WRITERS
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OOI INN LEONG
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t the start of 2020, when global markets were not looking
too good, the thinking then among many fund managers
was that it would be tough to bring in returns that matched
those of previous years.
Indeed, when the global markets crashed in March as
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Equity Malaysia Income (Islamic)
Equity Malaysia Income (Provident)
Mixed Asset MYR Balanced - Malaysia
(Malaysia)
Mixed Asset MYR Balanced - Malaysia (Islamic)
Mixed Asset MYR Balanced - Malaysia
(Provident)
Mixed Asset MYR Balanced - Global (Malaysia)
Mixed Asset MYR Balanced - Global (Provident)
Mixed Asset MYR Conservative (Malaysia)
Mixed Asset MYR Conservative (Islamic)
Mixed Asset MYR Conservative (Provident)
Mixed Asset MYR Flexible (Malaysia)
Mixed Asset MYR Flexible (Islamic)
Mixed Asset MYR Flexible (Provident)
FUND AWARD WINNERS
DURATION: 5 YEARS
AWARD
Bond MYR (Malaysia)
Bond MYR (Islamic)
Bond MYR (Provident)
COMPANY
AmFunds Management Bhd
Public Mutual Bhd
Kenanga Investors Bhd
Hong Leong Asset Management Bhd
Public Mutual Bhd
Public Mutual Bhd
Kenanga Investors Bhd
FUND
AmanahRaya Unit Trust
AmanahRaya Syariah Trust
AmDynamic Bond
Areca equityTrust
Hong Leong Dana Makmur
Hong Leong Dana Makmur
Public Emerging Opportunities
Public Islamic Opportunities
Kenanga OA Inv-Kenanga Growth
Opportunities
Public Strategic Growth
United ASEAN Discovery
KAF Jade
PB Islamic Asia Strategic Sector
Pheim Asia Ex-Japan
Public Islamic Asia Leaders Equity
Hong Leong Asia-Pacific Dividend
PB Global Equity
Public Islamic Global Equity
Areca Dividend Income
Public Islamic Savings
AmDividend Income
Public Growth Balanced
Kenanga SyariahEXTRA
Kenanga SyariahEXTRA
Public Strategic Balanced
Affin Hwang Select Balanced
United Income Plus
Public Ehsan Mixed Asset Conservative
Public Ehsan Mixed Asset Conservative
Public Tactical Allocation
Public Islamic Asia Tactical Allocation
RHB Thematic Growth
FUND
AmanahRaya Unit Trust
AmanahRaya Syariah Trust
AmDynamic Bond
Presented by
portantly, a major factor was the quick thinking and decisive meas-
ures by fund managers to manage the risks and ride the volatilty.
So, what was expected to be a washout year turned out to be an
extraordinary one for our fund managers. For the Refinitiv Lipper
Fund Awards 2021 in collaboration with The Edge, most of the win-
ning funds outperformed, with Public Mutual standing out again
as the biggest winner.
What of this year? There is certainly optimism that 2021 will be
a year of recovery, but be that as it may, challenges remain as we are
not quite out of the woods yet.
To all the winners, we say, “Congratulations”. — By Anna Taing
Equity Malaysia (Malaysia) Areca equityTrust
Equity Malaysia (Islamic) Hong Leong Dana Makmur
Equity Malaysia (Provident) AmMalaysia Equity
Equity Malaysia Small & Mid-Cap (Malaysia) Public Strategic SmallCap
Equity Malaysia Small & Mid-Cap (Islamic) Public Islamic Opportunities
Equity Malaysia Small & Mid-Cap (Provident) Maybank Malaysia SmallCap
Equity Malaysia Diversified (Provident) Hong Leong Growth
Equity Asia-Pacific (Malaysia) PB China Pacific Equity
Equity Asia-Pacific (Provident) PB Islamic Asia Strategic Sector
Equity Asia-Pacific ex-Japan (Malaysia) Pheim Asia Ex-Japan
Equity Asia-Pacific ex-Japan (Islamic) Public Islamic Asia Leaders Equity
Equity Asia-Pacific ex-Japan (Provident) Hong Leong Asia-Pacific Dividend
Equity Global (Malaysia) PB Global Equity
Equity Malaysia Income (Islamic) Public Islamic Savings
Equity Malaysia Income (Provident) Hong Leong Dividend
Mixed Asset MYR Balanced - Malaysia Public Growth Balanced
(Malaysia)
Mixed Asset MYR Balanced - Malaysia (Islamic) Kenanga SyariahEXTRA
Mixed Asset MYR Balanced - Malaysia Kenanga SyariahEXTRA
(Provident)
Mixed Asset MYR Balanced - Global (Malaysia) United Bond & Equity Strategic Trust
Mixed Asset MYR Balanced - Global (Provident) Affin Hwang Select Balanced
Mixed Asset MYR Conservative (Malaysia) PB Mixed Asset Conservative
Mixed Asset MYR Conservative (Islamic) Public Ehsan Mixed Asset Conservative
Mixed Asset MYR Conservative (Provident) Public Ehsan Mixed Asset Conservative
Mixed Asset MYR Flexible (Malaysia) Public Tactical Allocation
Mixed Asset MYR Flexible (Islamic) Public Islamic Asia Tactical Allocation
Mixed Asset MYR Flexible (Provident) Public Islamic Asia Tactical Allocation
FUND AWARD WINNERS
DURATION: 10 YEARS
AWARD FUND
Bond MYR (Malaysia) KAF Bond
Bond MYR (Islamic) PB Islamic Bond
Bond MYR (Provident) Maybank Malaysia Income
Equity Malaysia (Malaysia) Areca equityTrust
Equity Malaysia (Islamic) Affin Hwang Aiiman Growth
Equity Malaysia (Provident) AmMalaysia Equity
Equity Malaysia Small & Mid-Cap (Provident) KAF Vision
Equity Malaysia Income (Islamic) Manulife Investment Al-Fauzan
Equity Malaysia Income (Provident) AmDividend Income
Equity Malaysia Diversified (Provident) Affin Hwang Select Opportunity
Equity Asia-Pacific (Malaysia) PB China Pacific Equity
Equity Asia-Pacific ex-Japan (Malaysia) Pheim Asia Ex-Japan
Equity Asia-Pacific ex-Japan (Islamic) Public Islamic Asia Leaders Equity
Equity Asia-Pacific ex-Japan (Provident) Principal Asia Titans
Mixed Asset MYR Balanced - Malaysia Dana Makmur Pheim
(Islamic)
Mixed Asset MYR Balanced - Malaysia Dana Makmur Pheim
(Provident)
Mixed Asset MYR Conservative (Provident) Eastspring Investments Dana al-Islah
Mixed Asset MYR Flexible (Malaysia) InterPac Dynamic Equity
Mixed Asset MYR Flexible (Islamic) Eastspring Investments Dana Dinamik
Mixed Asset MYR Flexible (Provident) Manulife Investment-HW Flexi
Mixed Asset MYR Balanced - Global (Malaysia) Pheim Emerging Companies Balanced
 W4 Presented by

APRIL 19
2021

Public Mutual biggest winner

with 34 awards

P
B Y PAT H M A S U B R A M A N I A M

ublic Mutual Bhd dominated the

Refinitiv Lipper Fund Awards 2021,
bagging three group and 31 indi-
vidual awards — the greatest num-
ber of awards won by a fund man-
agement company — retaining
its winning streak for three years running.
The fund house clinched the Best Equity
Malaysia, Best Mixed Assets Malaysia and
Best Mixed Assets Malaysia (Islamic) group
awards, despite stormy market conditions
and global economic volatility caused chief-
ly by the Covid-19 pandemic.
Its CEO Yeoh Kim Hong attributes the
stellar performance to the funds’ holdings
of fundamentally sound companies with
positive long-term growth prospects that
displayed resilience during the pandem-
ic-led downturn.
The companies in their portfolios had
subsequently staged a strong rebound in
2020, following buying interest in quality
companies as sentiment improved, she says.
“The group award for an asset class is
conferred on the fund house with the best
overall ranking as derived from its eligi-
ble funds’ standings within their respec-
tive fund categories. Under the Best Equity
(Malaysia) group award, Public Mutual had
seven domestic and 13 foreign conventional
equity funds evaluated across the categories
of Equity — Malaysia, Asean, Asia-Pacific
ex-Japan, Asia-Pacific and Global.
“Under the Best Mixed Assets (Malaysia)
group award, we had four domestic funds
and seven foreign funds evaluated against
their peer funds, while we had three do-
mestic funds and one regional fund eval-
uated for the Best Mixed Assets (Malaysia Other funds, such as the Public Ehsan
FUND PB China Pacific Equity
Islamic) group award. Mixed Asset Conservative fund and the
“The performances of our funds in these
AWARD Equity Asia Pacific — Public Islamic Asia Tactical Allocation
three group categories were lifted by their Malaysia (5 and 10 years) fund, also benefited from holdings in the
investments in technology, e-commerce and FUND SIZE RM221.76 million technology, healthcare and e-commerce
healthcare stocks, which benefited from the Our equity funds RETURNS FOR PERIODS 3 years 35.64 sectors.
ENDED DEC 31, 2020 (%)
accelerated adoption of digital solutions, had to weather 5 years 86.87 The pandemic has accelerated the adop-
owing to social distancing measures and the sharp 10 years 166.09 tion of technology solutions for both cor-
increased demand for medical care and correction in the porations and consumers to accommodate
personal protective equipment amid the equity markets the movement restrictions and physical
Covid-19 pandemic.”
FUND PB Global Equity distancing measures globally.
at the start of the
The firm’s overarching philosophy of pandemic as well AWARD Equity Global — Malaysia As such, the firm rebalanced its equity
fundamental-based investing has ensured as the subsequent (3 and 5 years) investments accordingly into the domestic
that their funds deliver consistent returns FUND SIZE RM139.33 million and foreign technology, e-commerce and in-
periods of
over the long term, Yeoh says. ternet sectors, which are poised to benefit
This strategy saw to it that three of its elevated volatility RETURNS FOR PERIODS 3 years 37.09 from these structural changes, says Yeoh.
ENDED DEC 31, 2020 (%)
funds — PB China Pacific Equity, Public throughout the “In addition, our funds have increased
5 years 67.85
Tactical Allocation and Public Islamic Asia year.” exposure to selected healthcare stocks to
Leaders — won Lipper fund awards for five > Yeoh 10 years NA capitalise on the increased demand for
consecutive years. healthcare services, medical equipment and
PB China Pacific Equity fund’s perfor- personal protective equipment such as rub-
mance was underpinned by its holdings of FUND PB Islamic Asia Strategic ber gloves. The technology and healthcare
selected China internet and Taiwan tech- Sector sectors outperformed strongly relative to
nology stocks that benefit from the long- AWARD Equity Asia Pacific — the broader markets in the past year.
term structural growth of the internet and Provident (3 and 5 years) “As lockdown restrictions gradually eased
e-commerce, 5G and data centre segments. FUND SIZE RM51.27 million and prospects for a recovery in economic
The Public Tactical Allocation fund was RETURNS FOR PERIODS 3 years 40.64
activities improved amid positive news on
tactically positioned in selected US tech- ENDED DEC 31, 2020 (%) Covid-19 vaccines in 4Q2020, our funds were
5 years 80.88
nology software and healthcare companies, subsequently repositioned into selected re-
10 years 133.07
which benefited from the country’s accom- covery plays in the financial, basic materials,
modative monetary and fiscal policies as industrial, services, leisure and consumer
well as the sectors’ long-term structural FUND PB Islamic Bond sectors, which were anticipated to benefit
growth prospects. AWARD Bond MYR — Islamic from the restarting of business activities
The performance of the Public Islamic Asia (10 years) and a rebound in consumer spending.”
Leaders fund, on the other hand, was under- FUND SIZE RM1.51 billion These strategies enabled Public Mutual’s
pinned by its focus on regional market leaders RETURNS FOR PERIODS 3 years 19.72
fund managers to navigate the challenging
in the technology and e-commerce sectors, ENDED DEC 31, 2020 (%) market conditions in 2020 and outperform
5 years 32.40
particularly investments in electric vehicle their peers over the period.
supply chains, which are capitalising on the 10 years 71.10 On the fixed income front, the PB Islam-
increased focus on clean energy. CO N T I N U E S O N PAG E W 6
 W6 Presented by

APRIL 19
2021

‘Hold a diversified portfolio for the long term’

F R O M PAG E W 4
asset funds, which invest in a portfolio of tained a long portfolio duration for most of
ic Bond fund won the 10-year award in the both equities and bonds, exhibited lower 2020 on expectations of interest rate cuts as
Bond MYR–Malaysia Islamic category with volatility of returns compared with the eq- central banks globally reduced policy rates
a return of 71.1% over the review period. uity funds, which are generally positioned to mitigate the adverse economic impact
“The fund adopted a longer-duration in growth industries such as e-commerce, brought about by the Covid-19 pandemic.
portfolio to capitalise on falling bond yields internet and technology. This allowed our funds to capitalise on the
in the first half of 2020. It also focused its “The performance of these funds was lower bond yields in 2020.
investments on sukuk issued by the Malay- underpinned by contributions from their “The funds also focused their invest-
sian government as well as infrastructure bond/sukuk portfolios, as yields were com- ments on bonds with sound credit fun-
sukuk with sound credit fundamentals,” pressed in the first half of last year. damentals and resilient business models,
explains Yeoh. “Our bond funds, which are mainly in- which enabled us to avoid adverse credit
The fund house’s balanced and mixed vested in the Malaysian bond market, main- events amid slowing global and domestic
growth,” she says.
While there were opportunities aplenty,
there were nerve-wracking challenges to
FUND PB Mixed Asset FUND Public Islamic Global Equity contend with, Yeoh adds. “Our equity funds
Conservative AWARD Equity Global — Islamic had to weather the sharp correction in the
AWARD Mixed Asset MYR (3 years) equity markets at the start of the pandemic
Conservative (5 years) FUND SIZE RM344.43 million as well as the subsequent periods of elevat-
FUND SIZE RM80.59 million ed volatility throughout the year.
RETURNS FOR PERIODS 3 years 48.82 By adhering to
ENDED DEC 31, 2020 (%) “Nevertheless, by adhering to our funda-
RETURNS FOR PERIODS 3 years 19.84 5 years NA our fundamental
ENDED DEC 31, 2020 (%) mental investment approach of selecting
5 years 33.50 10 years NA investment stocks that have resilient earnings, strong
10 years NA approach of financial positions and proven manage-
selecting stocks ment records, our funds were able to nav-
FUND Public Islamic Opportunities
FUND Public Ehsan Mixed Asset that have resilient igate such challenging periods,” she says.
Conservative AWARD Equity Malaysia Small & earnings, strong On the fixed income front, the most chal-
AWARD Mixed Asset MYR Mid Cap — Islamic financial positions lenging situation faced by fund managers
Conservative — Islamic (3 and 5 years) and proven in 2020 was the uncertainties pertaining
(3 and 5 years) FUND SIZE RM1.02 billion to the Covid-19 outbreak.
management
Mixed Asset MYR RETURNS FOR PERIODS 3 years 33.81 “Thus, our strategy was to avoid bond/
ENDED DEC 31, 2020 (%) records, our sukuk issuers that could be adversely af-
Conservative — Provident 5 years 50.66 funds were able
(3 and 5 years) 10 years 164.61 fected by the contraction in economic ac-
to navigate such tivities while seeking to preserve credit
FUND SIZE RM346.35 million
challenging quality by focusing on issuers in sectors
RETURNS FOR PERIODS 3 years 27.04
ENDED DEC 31, 2020 (%) FUND Public Islamic Savings periods.” such as finance, telecommunications and
5 years 42.61
AWARD Equity Malaysia Income — > Yeoh utilities,” Yeoh explains.
10 years NA In view of continued global policy re-
Islamic (3 and 5 years)
FUND SIZE RM350.50 million sponses as well as the progressive rollout
FUND Public Emerging of vaccinations worldwide, she says gradual
RETURNS FOR PERIODS 3 years 17.72
Opportunities ENDED DEC 31, 2020 (%) recovery in the global economy and firmer
5 years 29.78
AWARD Equity Malaysia Small & financial markets are expected.
10 years NA “Against this backdrop, we may revisit
Mid Cap (3 years)
selected sectors and markets that are poised
FUND SIZE RM110.54 million
to benefit from the reopening of economic
RETURNS FOR PERIODS 3 years 53.95 FUND Public Strategic Balanced
ENDED DEC 31, 2020 (%) sectors and rebalance our equity exposure
5 years NA AWARD Mixed Asset MYR Balanced
accordingly.”
10 years NA - Global (3 years)
The equity funds are expected to con-
FUND SIZE RM35.43 mil tinue to focus on stocks that demonstrate
RETURNS FOR PERIODS 3 years 29.24 long-term sustainable growth, as they will
FUND Public Growth Balanced ENDED DEC 31, 2020 (%)
5 years NA be better positioned to weather the ups and
AWARD Mixed Asset MYR Balanced
(3 and 5 years)
10 years NA downs of the markets and provide consist-
ent returns over the long term.
FUND SIZE RM13.41 million
“Given the prospect of intermittent rises
RETURNS FOR PERIODS 3 years 25.16 FUND Public Strategic Growth
ENDED DEC 31, 2020 (%) in global bond yields in 2021 as market par-
5 years 42.02 AWARD Equity Malaysia Diversified ticipants gauge whether global economic
10 years NA — Provident (3 years) growth and inflation could accelerate more
FUND SIZE RM186.58 mil quickly than anticipated this year, our bond
FUND Public Islamic Asia Leaders
RETURNS FOR PERIODS 3 years 39.73 funds will maintain a defensive positioning
ENDED DEC 31, 2020 (%)
Equity 5 years 58.22 and focus on quality issuers at better pric-
AWARD Equity Asia Pacific ex Japan 10 years NA ing, while rebalancing on an ongoing basis
— Islamic (3, 5 and 10 years)
to capitalise on opportunities arising from
shifts in yield curves,” she says.
FUND Public Strategic SmallCap Considering the persisting volatility,
FUND SIZE RM2.03 billion
AWARD Equity Malaysia Small & Mid Yeoh recommends that investors maintain
RETURNS FOR PERIODS 3 years 43.99 a well-diversified portfolio consisting of
ENDED DEC 31, 2020 (%) Cap (5 years)
5 years 79.94 domestic, regional and global equity funds
FUND SIZE RM526.55 million
10 years 128.92 as well as fixed income funds.
RETURNS FOR PERIODS 3 years 11.67
ENDED DEC 31, 2020 (%)
5 years 20.70
“It is crucial that investors adopt Ring-
FUND Public Islamic Asia Tactical
git Cost Averaging, which will help them
10 years NA
Allocation
remain disciplined in investing for their
long-term financial goals and remove the
AWARD Mixed Asset MYR Flexible
FUND Public Tactical Allocation emotional component when investing dur-
— Islamic (3 and 5 years)
Mixed Asset MYR Flexible
ing market highs and lows.
Mixed Asset MYR Flexible AWARD
(3 and 5 years)
“As the market goes through cycles and
— Provident (5 years)
is subject to short-term volatility, inves-
FUND SIZE RM1.33 billion FUND SIZE RM633.73 million
tors are advised to hold their unit trust
RETURNS FOR PERIODS 3 years 38.63 RETURNS FOR PERIODS 3 years 40.28 investments over the long-term period of
ENDED DEC 31, 2020 (%) ENDED DEC 31, 2020 (%)
5 years 71.29 5 years 78.01 five years or more to allow time for their
10 years NA 10 years NA investments to grow,” says Yeoh. E
 W8
APRIL 19
2021
AmInvest overcomes pandemic hurdles
en route to group victory
A
B Y O L I V E R C H R I S T OP H E R G O M E Z
m F u n d s M a n a ge m e nt B h d
(AmInvest) emerged as a group
winner at the Refinitiv Lipper
Fund Awards 2021. In fact, the
fund management firm, helmed
by CEO Goh Wee Peng and chief
investment officer (CIO) Wong Yew Joe, bet-
tered its 2020 performance despite a year
of Covid-19-enforced lockdowns.
AmInvest won in the Best Bond Group
(Provident) category and took home a further
six individual awards (an improvement on
the one group and three individual awards
from last year). The group’s improved per-
formance came at a time when the economy
and markets were rocked by the pandemic
and the lockdowns.
According to Goh, while the pandemic
was not the first crisis the firm had faced,
this time around, AmInvest offices were
empty and lacked the usual rush to study,
formulate and implement strategies to
manage the market volatility, with most
of the team having to work from home.
“While selling pressure was strong, the
commitment of massive stimulus measures
by governments around the world main-
tained some [degree] of stability in March
2020,” she says.
“Our general investment stance was al-
ready moderately defensive on the back of
the bleak economic outlook in 2020. We were
also mindful, however, that an overly pes-
simistic investment stance would risk our
missing out on any swift market recovery.
“In addition to managing a more balanced
risk exposure, we were closely monitoring
the redemption patterns of the mutual
funds, as we had expected the volatility to
spur investors to redeem the investments.
“In hindsight, however, redemptions were
more manageable than expected, which
reflected investors’ sense that there was
more value in the market after the initial
selling pressure.”
For his part, Wong recounts that the
early divergence in the economic data and
market direction was a reflection that in-
vestors were eager to look beyond 2020,
even though the immediate risks (global
lockdowns and economic shutdowns) pre-
sented a bleak outlook.
Wong and his team had also anticipated
support in the form of massive fiscal and
monetary stimulus, which provided liquid-
ity to the markets. “We viewed the selling
pressure in most asset classes during the
second quarter of 2020 to have substantially
priced in the downside risk,” he explains.
At that point, it was a matter of looking
for signs that the pandemic would eventu-
ally wear out — something that Wong ad-
mits took some faith on his part. But one
year on, from the first Movement Control
Order (MCO), Wong and his team have been
vindicated.
Speaking on the firm’s overall fixed in-
come performance, Wong says he and his
team held fast to their convictions through-
out 2020 and remained consistent in their
approach to be selective on credit exposure.
“We engaged in active and tactical trad-
ing strategies based on prevailing market
valuations and outlook to generate alpha,”
he says. AmDynamic Bond picked up two
individual awards in the three- and five-
year returns categories for ringgit-denom-
inated bonds.
Presented by
still in play, he is hopeful the vaccination
drive will be successful.
“Newly elected US President Joe Biden
also brings the expectation of a return to
What we need to some predictability to the country’s in-
do is keep a level ternational relationships. In any event,
head and maintain improvements are expected to be gradual.
“Our funds generally adopt concerted
rationality when
strategies, and we expect the equity markets
[black swan] to continue their recovery, while the bond
events do strike.” market will still be supported by continued
> Goh accommodative monetary policies until
economic normalcy is achieved.”
Meanwhile, Goh says the pandemic high-
lighted the need for the investment com-
munity to be able to identify black swan
events, although, to be fair, the precise tim-
ing of these events is almost impossible to
determine. “What we need to do is keep a
level head and maintain rationality when
these events do strike,” she adds.
Like Wong, Goh is closely monitoring the
FUND AmDynamic Bond
AWARD Bond MYR - Provident
(3 and 5 years)
FUND SIZE RM186.08 million
We engaged FUND MANAGER Kho Hock Khoon
RETURNS FOR PERIODS 3 years 24.73
in active and ENDED DEC 31, 2020 (%)
5 years 36.75
tactical trading
strategies based 10 years 80.63
on prevailing
market valuations FUND AmMalaysia Equity
and outlook to AWARD Equity Malaysia - Provident
generate alpha.” (5 and 10 years)
> Wong FUND SIZE RM8.33 million
FUND MANAGER Wong Yew Joe
RETURNS FOR PERIODS 3 years 43.80
ENDED DEC 31, 2020 (%)
5 years 63.02
10 years 148.55
FUND AmDividend Income
AWARD Equity Malaysia Income -
Provident (3 and 10 years)
Despite the selling pressure on bonds FUND SIZE RM19.99 million
in 2Q2020, which spooked most bond fund FUND MANAGER Andrew Seah Saik Weng
managers, Wong and his team were com- RETURNS FOR PERIODS 3 years 24.61
mitted to maintaining a high portfolio ENDED DEC 31, 2020 (%)
5 years 35.48
duration and took some material trad-
10 years 106.6
ing positions in long-tenure government
bonds that boosted alpha returns through-
out the year. country’s trajectory towards herd immu-
The two other funds — AmMalaysia Eq- nity and, to that end, cites the availability
uity and AmDividend Income — won two and efficacy of vaccines to be paramount.
individual awards each. “These funds ben- She says: “Looking at the pace of inoc-
efited from active trading positions in rub- ulation in many countries and the confi-
ber gloves, a sector winner from 2020. In dence in the vaccines’ efficacies based on
addition, the portfolio stability was under- test results, we are more confident of a
pinned by a selection of dividend-yielding global recovery in the latter part of 2021,
and less volatile stocks in the larger and and perhaps slightly later for our own lo-
mid-cap segments,” Wong says. cal economy.
He attributes this year’s strong perfor- “The biggest risks right now have to
mance to the firm’s overarching investment do with just how long the vaccines’ effec-
philosophy. “We adopt a combination of tiveness will last, and the extent to which
top-down (macroeconomic views, trends multiple inoculations will be necessary to
and themes) and bottom-up (sector, stock achieve herd immunity.”
and credit selection, and relative valuation) Meanwhile, Goh expects investors to
approaches. continue to shift into riskier asset classes
“With these views, we deployed high such as equities, in line with the econom-
conviction structural and tactical strategies. ic recovery theme for this year. Global in-
For fixed income funds, the fund manager terest rate policies are expected to remain
continuously adds value by actively man- accommodative, and steep yield curves are
aging duration and yield curve positions.” likely to benefit the banking sector, she
Looking ahead, Wong anticipates the says. “We also think the technology sector,
broad economic recovery to be an anchor despite its rich valuations, will continue to
investment theme for this year. While the show upside potential, especially those at
downside risk of delayed herd immunity is the forefront of technology.” E
APRIL 19, 2021 W9
SEPT 29
2009
W10
APRIL 19
2021
Kenanga Investors wins two group awards
K
B Y TA N Z H A I Y U N
enanga Investors Bhd won two group
awards and five individual awards at
the Refinitiv Lipper Fund Awards 2021,
outperforming its record last year
and emerging as the winner with the
third highest number of total awards
this year (tied with AmFunds Management Bhd).
Kenanga won the group awards for Best
Equity Malaysia (Islamic) and Best Mixed As-
set Malaysia (Provident). Under the individual
awards, it clinched the Best Mixed Asset MYR
Balanced (Islamic) and Best Mixed Asset MYR
Balanced (Provident) awards for the three- and
five-year categories. Kenanga also won the Best
Equity Malaysia Small & Mid Cap (Provident)
for the three-year category.
This success can be attributed to the fund
house’s commitment to improvement and
sustainability, says CEO and executive director
Ismitz Matthew De Alwis.
“In 2020, we experienced one of the most
volatile market conditions ever; it is testament
to our capabilities as an asset and wealth man-
ager to receive recognition for our performance
last year,” he says.
“The firm’s investment strategy of bottom-up
stock picking,coupled with a stringent risk man-
agement framework, guided us as we navigated
the complexities of the investment universe.
This enabled us to produce superior returns to
the index in the medium to long term.”
Despite the volatility in the market, there
was no change to the fund house’s investment
philosophy or strategy last year.
“We follow a comprehensive research pro-
cess, from understanding industry dynamics
to individual company business models and
drivers of return on equity,” says chief invest-
ment officer Lee Sook Yee.The fund house also
practises dynamic asset allocation according
to market conditions.
“While timing the market is notoriously
difficult, we aim to practise good risk manage-
ment by judiciously scaling back exposure when
risk abounds and further downside is likely,
and increasing exposure when conditions are
favourable. Notwithstanding, our stock-pick-
ing approach is still the main driver of alpha.”
The two winning funds — Kenanga Syariah-
EXTRA and Kenanga OA Inv-Kenanga Growth
Opportunities — benefited from the fund house’s
bottom-up stock selection in small- and mid-
cap counters, she adds. Many of these coun-
ters exhibited strong, market-beating earnings
growth in the past few years, including in 2020.
A key call that the investment team made last
year was to overweight the tech and healthcare
sectors.As Kenanga is benchmark agnostic, the
heavier positioning in these two sectors and un-
derweight in other sectors like financials and
consumer led to the outperformance, says Lee.
“Despite the demand shock arising from the
pandemic in the first part of the year, structural
trends such as 5G, electric vehicles, artificial in-
telligence, Internet of Things (IoT) and e-com-
merce continued to gain traction and, in some
cases, were even accelerated by the pandemic.”
The outperformance is also due to the selec-
tion of key companies best positioned to grow
within each theme, she adds. Additionally, an
overweight in rubber glove companies contrib-
uted to the performance.
Despite the stellar performance, navigating
2020 was challenging due to the volatile market.
“The financial market was ironically ‘bless-
ed’ by the central banks’ liquidity management
and monetary injection, much of which have
found their way to the stock markets, boosting
record-high trading volume and stock price re-
flation,” says De Alwis.
“However, the reflation story was not with-
out extreme volatility, both during the sell-off
in March and the equally sharp rebound in
subsequent months.As such, the key challenge
was to refrain from panic selling while still ad-
hering to good risk management principles in The firm’s
reducing exposure to stocks that were funda- investment
mentally impaired.” strategy of
In the first half of 2020, the fund house held bottom-up stock
a higher-than-usual portion of cash. Unprece- picking, coupled
dented levels of fiscal and monetary stimulus in with a stringent
the second half of the year prompted the fund
risk management
house to rebalance and increase investments.
“Throughout this time, trading activity and framework, guided
fund turnover were higher than [in] normal us as we navigated
years, as the fund [managers] sought to take ad- the complexities
vantage of the extreme market volatility.Overall, of the investment
our investment levels have stayed fairly high on universe. This
average during the year in sectors that continued enabled us to
to enjoy earnings expansion, thus minimising produce superior
the low-yielding ‘cash drag’,” says Lee. returns to the
index in the
BRIGHTER DAYS AHEAD medium to long
Given the global economic recovery expected
term.”
this year, Kenanga will adopt a balanced ap-
proach with a barbell strategy, centred on the > Matthew De
two themes of recovery and structural growth, Alwis
observes De Alwis.
To benefit from the economic recovery, the
fund house has increased exposure to cyclical
sectors such as consumer discretionary, finan-
cials, energy and commodities. Meanwhile, the
structural growth trends include 5G proliferation,
automation,IoT,renewable energy and trade di-
version,which are expected to accelerate,he adds.
“Therefore, we will continue to invest in
technology, electronics manufacturing ser-
vices and the renewable energy space, which
Presented by
provide the best exposure to these structural
growth themes.”
Last year was an exciting one for Kenanga as
the fund house launched its first exchange-traded
funds (ETFs) through leveraged and inverse ETFs.
“Throughout the year, the ETFs have helped
clients optimise and diversify their portfolios to
better reflect their outlook for domestic markets
with a greater degree of flexibility while being
cost efficient,” says De Alwis.
The fund house also launched the third
tranche of the Kenanga AUD Alternative In-
come Fund Series, which allows its clients to
diversify their investments in the Aussie dollar.
“We launched several debts and equity wrap-
pers, which have proven to be popular among
our high-net-worth clients during the current
low interest rate and volatile environment,”
says De Alwis.
In February this year, Kenanga acquired
i-VCAP Management Sdn Bhd,a shariah-compli-
ant investment management services provider
primarily focused on Islamic ETFs.
This acquisition reflects Kenanga’s interest
in Islamic investment products, especially in
relation to sustainable and responsible invest-
ments. An area of significant potential is the
development of waqf, an Islamic philanthrop-
ic-based vehicle for social development, public
good and wealth distribution, says De Alwis.
“There will be efforts to increase the level of
sustainable waqf assets through fund manage-
ment or capital raising in sectors such as health-
care, education and community development.”
In line with the Securities Commission’s Is-
lamic Fund and Wealth Management Blueprint
and the waqf featured-fund framework,the fund
house launched a waqf-themed fund in April.
“The fund will provide opportunities for all
Malaysians to invest with professional fund
managers while contributing to societal and
community development throughout the coun-
try,” says De Alwis.
FUND Kenanga SyariahEXTRA
AWARD Mixed asset MYR Balanced
– Islamic (3 and 5 years)
Mixed asset MYR Balanced
– Provident (3 and 5 years)
FUND SIZE RM120.65 million
FUND MANAGER Low Pei Yee
RETURNS FOR PERIODS 3 years 40.29
ENDED DEC 31, 2020 (%)
5 years 62.78
10 years 119.79
FUND Kenanga OA Inv-Kenanga
Growth Opportunities
AWARD Equity Malaysia Small & Mid
Cap — Provident (3 years)
FUND SIZE RM336.26 million
FUND MANAGER Low Pei Yee
RETURNS FOR PERIODS 3 years 50.81
ENDED DEC 31, 2020 (%)
5 years 63.62
10 years 156.80
Another upcoming venture is the launch of a
new multi-functional digital platform to address
the needs of Kenanga’s clients, advisers, opera-
tions and reconciliation teams through a variety
of financial and investment services, he adds.
“We are planning to utilise this digital plat-
form as a gateway accessible from multiple de-
vices for multiple products such as unit trusts,
financial planning, private retirement schemes
and actively managed portfolios. This digital
initiative is another piece in our over-arch-
ing customer experience agenda by allowing
straight-through processing to save on res-
ources,” says De Alwis. E
W12 Presented by

APRIL 19
2021

Hong Leong Asset Management

bags eight awards

H
B Y VA N E SSA G O M E S

ong Leong Asset Management Bhd

(HLAM) continued its winning streak,
taking home eight awards at the Ref-
initiv Lipper Fund Awards 2021.It won
the Best Equity Group (Provident)
award for the second year running.
Hong Leong Dana Makmur won the Best
Equity Malaysia (Islamic) awards for the three-
and five-year categories and Best Equity Malay-
sia (Provident) award for the three-year cate-
gory. Hong Leong Asia-Pacific Dividend Fund
bagged the Best Equity Asia-Pacific ex-Japan
(Provident) awards in the three-year and five-
year categories.
Hong Leong Growth walked away with the
Best Equity Malaysia Diversified (Provident)
award in the five-year category while Hong Leong
Dividend won the Best Equity Malaysia Income
(Provident) award in the five-year category.
HLAM CEO Hoo See Kheng says over the past
years,the company’s funds have performed well
despite the many uncertainties and challenging
macro events. He believes that being consistent
in their investment approach and strategy was
the key to attaining long-term and sustainable
fund returns that met clients’ expectations.
“A competent and highly motivated invest-
ment team is also critical in ensuring that the
investment process is well executed to deliver
the desired fund performance,” he says. environment that tends to lead to very diver- FUND Hong Leong Dana Makmur
Last year was certainly an unprecedented gent prospects among different industries and AWARD Equity Malaysia — Islamic
and eventful period. All asset classes experi- sectors,” he says. (3 and 5 years)
enced a correction when global economies Hoo adds that the team found itself in Equity Malaysia —
were forced to enter into a lockdown.The world We stuck closely uncharted waters last year with very little Provident (3 years)
saw negative oil prices, Covid-19 outbreaks, the historical context to refer to. “However, we FUND SIZE RM19.40 million
to our belief that
rise in retail investors’ participation in global are of the view that when a company’s fun- RETURNS FOR PERIODS 3 years 55.00
equity markets and the unexpected change of a bottom-up damentals and outlook remain intact, the ENDED DEC 31, 2020 (%)
stock picking 5 years 82.71
government in Malaysia. stock price will eventually reflect the compa-
strategy is the 10 years 149.86
“Against a challenging investment landscape ny’s intrinsic value. We also maintained our
that was very dynamic and evolving almost on ideal investment discipline in assessing the valuation of the
a monthly basis,we battened down the hatches approach and company at all times, carefully weighing the FUND Hong Leong Asia-Pacific
and made even greater efforts to look for invest- were constantly potential upside against the downside risks Dividend
ment opportunities and identify companies that on the lookout for before investing in it. AWARD Equity Asia Pacific ex Japan
were possibly mispriced by investors. opportunities. “Again, we stuck closely to our belief that a — Provident (3 and 5 years)
“Despite the logistical difficulties caused by > Hoo bottom-up stock picking strategy is the ideal FUND SIZE RM46.24 million
the lockdown,we persevered to establish regular investment approach and were constantly on RETURNS FOR PERIODS 3 years 63.26
engagement with the management of various the lookout for opportunities. ENDED DEC 31, 2020 (%)
5 years 98.00
companies, an exercise which was more rele- “As such, the funds were well invested
vant due to the rapidly changing economic and throughout the whole year, even during the 10 years 94.64
geopolitical climate,” says Hoo. sharp decline in March. We took advantage of
“As the Covid-19-related recession and the the severe price dislocations to establish posi- FUND Hong Leong Dividend
economic recovery that followed had vastly tions in well-managed companies that were AWARD Equity Malaysia Income —
divergent impacts across different sectors and trading at very attractive valuations,” he says. Provident (5 years)
companies, we believe that a thorough under- For instance, the firm invested in select- FUND SIZE RM112.06 million
standing of the company’s fundamentals and ed export stocks, particularly companies in RETURNS FOR PERIODS 3 years 35.39
a precise appraisal of the company’s outlook the technology and manufacturing sectors, to ENDED DEC 31, 2020 (%)
5 years 79.37
were critical in driving HLAM’s fund outper- capitalise on the shift in consumers’ spend-
10 years 151.07
formance,” he adds. ing habits. These stocks benefited the firm’s
The stellar fund performance is a testament award-winning funds last year.
to HLAM’s belief that a bottom-up stock-pick- As for 2021, Hoo says the firm is positive on FUND Hong Leong Growth
ing strategy is the ideal investment approach the outlook for equities. The current vaccine AWARD Equity Malaysia Diversified
for the local market. This strategy has stood rollout has proven to be very effective against — Provident (5 years)
the test of time and will continue to be highly Covid-19 and he expects life to gradually return FUND SIZE RM200.54 million
effective in creating sustainable performances to pre-pandemic times. RETURNS FOR PERIODS 3 years 33.26
for the funds, says Hoo. “The generous fiscal stimulus and accommo- ENDED DEC 31, 2020 (%)
5 years 65.27
“Although we acknowledged that much of dative monetary policies by the central bank is
10 years 113.32
what happened in 2020 was highly unusual,we expected to continue to support equity valua-
did not see the need to change our investment tions. For our funds,we prefer the export sector
approach, which has served us well in the past. as we expect it to benefit from the improving risks to look out for, but the likelihood is low at
“In fact, using the same active fund man- external demand.” the moment,” he says.
agement and high conviction approach has Recent global economic data points to a ro- Over the next 12 months,Hoo expects interest
proven to be very effective for us. We intensi- bust economic recovery, says Hoo. “We believe rates to stay low domestically and globally. He
fied our research efforts to capitalise on some the risk to the economic recovery is a resurgence believes that savers would seek out investment
of the buying opportunities that were present of the pandemic, although the likelihood ap- opportunities that can give better returns than
in the midst of extreme volatility. pears low at the moment due to the rollout of the current deposit rates. “Investment products
“We believe having a deep understanding the vaccine,which is showing promising results. such as unit trusts with consistent and proven
of the company and knowledge of its business “Higher-than-expected inflation leading to performance track records would continue to
outlook is critical, particularly in an economic tighter monetary conditions is also one of the do well in the coming year.” E
W14
APRIL 19
2021
The first half of last
year was one of the
most unique investment
experiences we have
had. Malaysian investors
were faced with one of
the fastest collapses in
asset prices, economic
activity as well as a
change in government,
with unknown policy
directions. We had a
health, economic and
political crisis all at the
same time.” > Gan
We were able to cut our
losses and limit our funds
to double-digit losses in
general. It gave us a solid
enough base to mount a
strong comeback later that
year.” > Chue
The lesson learnt here,
really, is that a deep and
sharp pullback in the
equity market triggered
by a crisis is usually a
great opportunity to
invest. The crisis will
pass, and the market
will eventually rebound
as investors are always
forward looking.” > Lee
RESILIENCE
in a year of black swan events
A
B Y T H E W E A LT H T E A M
 
year of triple black
swan events is how
Gan Eng Peng, sen-
ior director at Affin
Hwang Asset Man-
agement Bhd, depicts
2020.They were the Covid-19 pan-
demic,the collapse of the Pakatan
Harapan government and crude
oil prices falling into negative ter-
ritory — the first time in history.
“The first half of last year was
one of the most unique invest-
ment experiences we have ever
had. Malaysian investors were
faced with one of the fastest col-
lapses in asset prices, economic
activity as well as a change in
government,with unknown pol-
icy directions. We had a health,
economic and political crisis all
at the same time,” says Gan.
Local markets were in turmoil
while fund managers’ eyes were
glued to the screen.At least, that
was the case for Chue Kwok Yan,
chief investment officer (CIO)
at KAF Investment Funds Bhd.
“We were stuck in front of the
computer screen.When we were
away from our desks, our eyes
were glued to the phone. Battery
life on our mobile devices was
impaired over that period. And
probably the life expectancy of
our team members shortened
too,” he quips.
Working from home com-
pounded the challenges that
Chue and his team were facing.
They struggled to replicate the
smooth communication they
had when working together in
the same office. “It was an emo-
tional and stressful period — an
experience difficult to put into
words,” he says.
CEOs and CIOs of other fund
houses that manage billions in
investors’ money express the
same experience, though in
varying intensities, in their
email responses to Wealth. But
witnessing a crisis unfold was
definitely not fun, even for an
experienced fund manager who
has gone through various up and
down cycles.
“Experiencing market turmoil
is never pleasant,” says Kenanga
Investors Bhd CIO Lee Sook Yee.
“We had been through previ-
ous crises like the 1997/98 Asian
financial crisis and the global
financial crisis a decade later.
“There was also the European
sovereign debt crisis in 2009, the
US taper tantrum in 2013 and the
global trade spats in 2018. The
list goes on.
“But this crisis was different.
What surprised us last year was
the speed and ferocity of both
the selldown and the subsequent
rebound.”
A keyword in Lee’s response,
however, is “rebound”. Markets
quickly clawed back ground in
the second half of last year, and
so did the performance of var-
ious funds that had been well
positioned during the market
meltdown.
In the case of Kenanga Inves-
tors, most of its equity funds fell
by 18% to 33% last year compared
with 2019. But these funds were
up 9% to 43% at year end, which
more than recouped their loss-
es in the first half of the year,
says Lee.
Many of the other winners at
the Refinitiv Lipper Fund Awards
2021 staged a comeback in the
second half of 2020 and ended
the year with positive returns.
More importantly, these funds
generated impressive returns
over the longer period of three,
five and 10 years.
The question then, is how did
they do it? What are the crucial
lessons fund managers learnt
from these unprecedented events.
The toughest decision:
Cut losses, reserve cash
The market last year was a tale
of two halves as funds that had
invested in mainly the glove and
semiconductor sectors performed
better than their peers.But other
real challenges lay in their deci-
sions to cut losses, reserve cash
and rebalance their portfolios.
KAF’s Chue recalls how hard
it was to cut losses and raise cash
last year.The award-winning KAF
Vision Fund,which mainly invests
in local small and mid-cap com-
panies,was up 54.3% at end-2020.
But it suffered a loss of more than
20% at one point.
“We were able to cut our loss-
es and limit our funds to dou-
ble-digit losses in general.It gave
us a solid enough base to mount a
strong comeback later that year,”
he explains.
Various award-winning fund
managers mention that raising
cash and cutting losses earlier
on was the key to their outper-
formance in 2020. Danny Wong,
CEO of Areca Capital Sdn Bhd,
raised cash in February last year
and reduced the equity market
exposure of its funds to about
50%,which is way below the nor-
mal level.
RHB Asset Management Sdn
Bhd did the same. And it was a
tough call, says CEO Eliza Ong.
“The decision to reduce equity
exposure significantly is very un-
common to equity funds. Never-
theless, it had to be swiftly done
in these unprecedented circum-
stances to protect asset values.”
The decision to cut losses was
also based on instinct that comes
with extensive experience, says
Affin Hwang’s Gan. “When we
were faced with an unknown fu-
ture, we followed our basic in-
stinct of preserving clients’ cap-
ital.We knew we were going into
the fastest and deepest recession
Presente
Pres
Presented
ted
d by
in recent history. But this would
mean selling into the downward
trend at depressed prices.
“In hindsight,we made some
mistakes.But that was a prudent
decision. Cutting losses, some-
times at a deep level, were coun-
ter-intuitive to our wealth gener-
ation goal.But because of that,we
more than made up for the losses
incurred during the early part of
the year by subsequently turning
to a risk-on mode.”
After all, making losses was
almost unavoidable as various
events took place at great speed
last year. “Events were happen-
ing faster than what the market
could digest.And the usual tools
of looking at markets did not
work,” says Gan.
For Kenanga Investors CEO
Ismitz Matthew De Alwis, the
imminent challenge was not just
to sell, but to hold on to stocks
before selling them at the right
time.“We made some tough calls
to not panic sell during the sharp
drop at the beginning of last year.
When the market is in turmoil,
the hardest thing to do, some-
times, is to not do anything and
stick to your strategy,” he says.
The next challenge was then
to add on to those stocks that the
fund house still held a convic-
tion in during the market crash,
he adds.
Dr Tan Chong Koay, found-
er and chief strategist of Pheim
Asset Management Sdn Bhd,
concurs with De Alwis’ second
point. Bargain-hunting during
a depressed market is wise, but
hard to execute.
“Buying shares in a major
crash takes a lot of courage as
we would be acting against the
majority of investors.We cannot
 W15
Presente
Pres
Presented
ente
t d by
by

APRIL 19
2021

ESG investing on the rise

S
everal trends have accelerated and
emerged stronger since the Covid-19
pandemic wreaked havoc on the world.
Environmental, social and governance
(ESG) investing is one of them.
Ahmad Najib Nazlan, executive director
and CEO of Maybank Asset Management
Sdn Bhd, says ESG-related data were very
helpful last year in helping the firm discover
companies that are resilient in facing economic
and market adversity. “Companies with high
ESG scores have experienced lower cuts in
earnings growth compared with those with
lower scores. Furthermore, we found that in the
long run, high ESG-ranked companies tend to
outperform conventional companies at lower
volatility.”
As at Dec 31, 2020, the MSCI World Socially
Responsible Investing (SRI) Index generated
10.4% per annum, while the MSCI All Country
World Index (ACWI) was lower at 9.7%. The
volatility of the former at 13.4% was also lower
than the latter at 14.2%.
Dr Tan Chong Koay, founder and chief
strategist of Pheim Asset Management Sdn
Bhd, says the rise of ESG is due to a growing
awareness of environmental issues among the
public. “The extreme weather phenomena that
affected many parts of the globe in recent
years have drawn more attention to the need
for us to do more to protect the environment.
We increasingly realise that we must all do our
part in engaging in and promoting sustainable
practices to preserve the earth for future
generations.”
The election of Joe Biden as US president
has been another boost for the ESG investing
trend, says Tan. “Biden won the 2020 US
presidential election partly on the Green New
Deal campaign platform. The election win has
given him and other governments the political
will to push the ESG agenda forward after a
lull over the last four years. This agenda has
existed since the Obama administration,” he
adds.
“It has also given the ESG investing trend
fresh impetus in the investment space today.”
However, the trend has its own set of
challenges. Yeoh Kim Hong — CEO of Public
Mutual Bhd, the biggest winner at the Refinitiv
Lipper Fund Awards 2021 — says the differing
quality of ESG information disclosed by
companies is one of them. This is despite
an increased level of disclosure made by
companies.
“The inclusion of environmental and social
considerations when undertaking investment
decisions is still a challenge for us. And it is
expected to be a gradual process,” she says.
Ismitz Matthew De Alwis, CEO of Kenanga
Investors Bhd, agrees. “The first problem
we encounter is ensuring the quality and
accuracy of information. Financial data of listed
companies are checked by auditing firms. But
non-financial data are not endorsed by third
parties in many cases. The rules of disclosures
vary. And the conversion and standardisation
of disclosure guidelines still need to be
developed,” he says.
Moreover, it is hard to analyse and evaluate “Ideally, we want to sell
vast amounts of ESG data even when they are shares at their highest
available. There is also a lack of standardisation point, when they are
of reported data by companies and quick overvalued. This is not an
accessibility to this data by fund houses, says easy call. But having good
De Alwis. research and extensive
“We will continue to work towards investment experience
observing ESG data standards locally and certainly helps.” > Tan
internationally. There are no fixed rules on how
fund managers must include ESG factors into
their investment decisions. But we selectively
consider methodologies such as norms-based
screening, negative screening and positive or
best-in-class screening, among others, in our
investment processes,” he says. E

be sure that we would be buying
shares at the lowest price, and
prices can go lower.This may lead
us to underperform, at least tem-
porarily,” says Tan.
Another significant chal-
lenge for Pheim was when cli-
ents rushed in,wanting to redeem
their capital when the market
was in a free fall. Fund managers
would have to sell shares for cash
to meet these redemptions, even
if they felt that they should hold
on to those shares or buy more.
“We were lucky that many of
our clients followed our advice not
ot
to redeem when the market wass
depressed,” says Tan.
In fact, many award-winningg
fund houses have thanked their irr
clients for trusting them duringg
the market meltdown.Just as Are- e-
ca’s Wong rightly sums it up.
“Even if a fund has ample cash h
holdings,the fund manager’s abil- l-
ity to use the cash is restrained iiff
there is a huge amount of outflows
wss
due to client redemptions.An in- n-
formed client base that believess
in the fund manager’s ability iss
important,” he says.
Key lessons from 2020
Take profit with discipline and d Banking Bhd as the company with
do not be too greedy — this wass
a key lesson for Pheim’s Tan in n on Bursa Malaysia.
2020. While he invested in glove vee
stocks last year, he sold some ooff
them during the latter part of thee
year to lock in healthy profits. Inn
hindsight,he made the right move. e.
“Ideally,we want to sell sharess
at their highest point,when theyy
are overvalued.This is not an easyy
call,but having good research and d
extensive investment experiencee
certainly helps,” says Tan.
For instance,Pheim sold somee
of its positions in Supermax Corp p
Bhd at RM21.55 per share.The stockk
Dec 31,2020
120
116.26
114.34
100 102.42
80
MSCI All Country
S&P 500 Index World Index FBM KLCI
60
Jan Feb Mar Apr May June July Aug Sep Oct Nov Dec 31
2020
peaked at RM23.76 before losingg Covid-19 pandemic, is different nt
almost half its value by the end d from a typical economic or finan- n-
of last year. cial crisis where [the share prices]
s]
“This is despite brokers beingg of all sectors benefit from fiscal pol-
oll-
very bullish on the stock, with h icies introduced by the governmentnt
some saying that it would go be- e- and interest rate cuts,” she says..
yond RM30. We received manyy “Unlike previous crises like the
he
comments from our stakeholders rs Asian financial crisis and global al
and brokers asking why we want- t- financial crisis, certain sectors rs
ed to sell Supermax shares at such h may look cheap in terms of their ir
a time. However, we were proven n valuations after prices collapsed ed
right when its share price fell near-
r- last year, but it may not be the he
ly 50% from its peak,” says Tan. right time for investors to enter er
Meanwhile,a similar scenarioo stocks in those sectors yet. In- n-
played out at Top Glove Corp Bhd, d, vestors would have to wait until tiil
which almost overtook Malayan n there is a clear sign that the virus
us
h can be stopped from spreading ng
the largest market capitalisation n further or effective vaccines are re
widely available.
“A similar situation can be seenn “On the other hand, certain n Investments Bhd, says, “Do not
in Top Glove. Some brokers said d sectors that are expected to ben- n-
that in a bull-case scenario, its ts efit from the pandemic have con- n--
n stocks are sold down to very cheap
share price could go up to RM70 or or tinued to perform strongly. [In- n-
even RM100.This was far higher er stead of a synchronised recovery rryy
than its peak of RM29.30.This is a in all sectors], certain sectors in n
classic case of people being overlyy the economy may recover more re
optimistic,” says Tan. slowly than others.”
Meanwhile, the crucial lesson n Kenanga Investors’ Lee con- n-
RHB Asset Management’s Ongg curs with Ong’s view. The key ey
learnt is that each crisis is differ-
r- lesson is to spot the right oppor- rr--
ent and that investors should stayy tunities and stay invested in the he
calm to spot the right opportuni- i- market. “Investors should keep ep p
ties. “A health crisis, such as thee their cool and remain invested ed
ed
throughout the crisis, though
with a certain rebalancing of the
portfolio and rejigging of strate-
gy,” she says.
Governments and central
banks globally took unprecedent-
ed measures to rescue their econ-
omies and markets, resulting in
abundant liquidity, which sped Unlike previous crises
up the global stock market recov- like the Asian financial
ery after March last year. While crisis and global financial
investors were shocked by the crisis, certain sectors
sharp pullback in markets, they may look cheap in terms
were equally surprised by the swift
of their valuations after
recovery that followed. p
prices collapsed last year,
“Many investors were reluc- but it may not be the right
b
tant to put their money to work ttime for investors to enter
during the early stage of the mar- stocks in these sectors
ket recovery. Instead, they pre- until the virus can be
ferred to hang on for a deeper stopped from spreading
plunge,” says Lee. further.” > Ong
“The deeper correction,howev-
er, did not materialise.And most
investors realised later that mar-
kets were looking towards a re-
covery instead.
“The lesson learnt here,really,
is that a deep and sharp pullback
in the equity market triggered by
a crisis is usually a great opportu-
nity to invest.The crisis will pass
and the market will eventually
rebound as investors are always
forward looking.”
Juliana Ramli, equity fund
manager at Eastspring Al-Wara’
be fearful to bargain hunt when
levels. Instead, we continued to
focus on our investment process Even if a fund has ample
and followed through with a dis- cash holdings, the fund
ciplined,medium-term approach. manager’s ability to use
“Teamwork and open com- the cash is restrained if
munication between team there is a huge amount
members are equally impor- of outflows due to client
tant to provide the necessary redemptions. An informed
support during stressful times. client base that believes in
And the ability to adapt to sud- the fund manager’s ability
den changes is key.” E is important.” > Wong
W16 Presented by

APRIL 19
2021

Affin Hwang bags four awards

A
B Y VA N E SSA G O M E S
ffin Hwang Asset Management Bhd
(AHAM) won four awards at the Re-
finitiv Lipper Fund Awards 2021. For
the fourth year running, its Affin
Hwang Select Opportunity Fund won
the award for Best Equity Malaysia
Diversified (Provident) in the 10-year category.
Other funds in the limelight were the Affin
Hwang Aiiman Growth Fund for Best Equity
Malaysia (Islamic) in the 10-year category and
Affin Hwang Select Balanced Fund for Best
Mixed Asset MYR Balanced — Global (Provident)
in the three- and five-year categories.
Gan Eng Peng, senior director of equity at
AHAM, says it is an honour to be recognised by
the industry standard. He attributes the success
of the Select Opportunity fund to the quality
and cohesion of its enlarged investment team,
which was critical to navigating a modern in-
vestment climate.
He says the fund’s portfolio significantly
shrank in terms of the number of positions and
sector exposure to reflect the narrow breadth
of the market run. Contrarian strategies did
not work, he adds, as the winning positions
kept surging.
“We had one of the biggest tactical asset al-
location changes in 2020 since the credit crisis.
Major portfolio changes were made as econom-
ically sensitive and political stocks were out of
favour, while healthcare and technology were
the major performance drivers,” says Gan.
“Our cash levels ranged from near zero to growth stocks. These are companies that offer
over 30% to reflect the changing market condi- structural growth potential, strong business
tions. We believe the rapid decision-making in moats and a healthy balance sheet,” he says.
portfolio repositioning was critical to market “What also helped us was our focus on fun-
We had one outperformance.” damentals and not letting periods of extreme
Looking at the current economic climate, market sentiment cloud our judgement,which
of the biggest
he says the firm believes monetary conditions was not easy. But we viewed it as opportunities
tactical asset will again be a key driver of asset prices in 2021, for mispricing to occur. This allowed us to po-
allocation followed by domestic politics. sition and lock in returns at attractive prices.”
changes in Touching on the Affin Hwang Aiiman Growth Looking ahead, Akmal says the firm will
2020 since the Fund, Akmal Hassan, managing director of maintain its investment strategy in 2021, fo-
credit crisis. AIIMAN Asset Management Sdn Bhd, says the cusing on three main themes: Covid-19 recov-
Majoror portfolio fund did most of its rebalancing in ery plays, trade divergence beneficiaries and
nges
changes 1Q2020 and 4Q2020, where the first technology stocks. As the economy gradually
were e made … rebalancing involved increasing reopens with vaccination gaining traction, the
lthcare an
healthcare nd
and its cash positions before the sell- market will factor in greater optimism into beat-
hnology
technology down to protect the fund and pro- en-down sectors, such as consumer and retail,
vide ammunition to capitalise financial and commodities, he says.
were e the majoor
major
on opportunities. The second re- He notes that the growing presence of and
formance
performance balancing was done to accommo- reliance on technology is a structural trend
ers..“
drivers..“ date post-pandemic beneficiaries whose adoption has been accelerated by the
an
> Gan once it became clearer that pandemic.Thus, he believes that the sector will
there was light at the continue to be an important part of the firm’s
end of the tunnel. portfolios over the long term.
“The fund took a Meanwhile,David Loh,senior portfolio man-
barbell approach, ager at AHAM, says the Affin Hwang Select Bal-
with significant po- anced Fund’s equity allocation was highly agile
sitions in defensive last year due to the many unpredictable events
companies to an- such as the collapse of the Pakatan Harapan
chor the portfo- government and the Covid-19 outbreak.
lio.This was then “We went into capital protection mode early
balanced by posi- on by raising cash levels to above 20%, in antic-
tions in what we ipation of a major market correction,” he says,
deem as quality adding that it started deploying cash again

Pheim Asset Management garners six awards

P
B Y IRIANI AMIRUDIN portunities. They can earn good returns by par- FUND Pheim Asia Ex Japan
ticipating in the market when most shares are AWARD Equity Asia Pacific ex Japan
heim Asset Management Sdn Bhd took being offered at big discounts. Our experience — Malaysia
home six awards at this year’s Refini- and track record speak for themselves. We have (3, 5 and 10 years)
tiv Lipper Fund Awards. For the sixth been able to do well during many crises,” he says. FUND SIZE RM10.30 million
consecutive year,Dana Makmur Pheim We believe in With cash in hand, the fund house picked FUND MANAGER Pheim Asset Management
swept the award for Best Mixed Asset up many stocks at attractive valuations from
trimming our Sdn Bhd
MYR Balanced (Islamic) in the 10-year March to May, which led to the outperformance
category.The fund also took home the award for equity exposure of Pheim’s funds last year. RETURNS FOR PERIODS 3 years 22.48
ENDED DEC 31, 2020 (%)
Best Mixed Asset MYR Balanced (Provident) in near market “The decision by our investment team to buy 5 years 44.01
the 10-year category. peaks to preserve glove company shares early [was the right move]. 10 years 49.65
The Pheim Asia Ex-Japan fund grabbed the capital. This For instance, the shares of Supermax went up
awards for Best Equity Asia-Pacific ex-Japan in philosophy works by more than 1,000% in less than three months, FUND Pheim Emerging
the three-, five- and 10-year categories,whereas well in the volatile outperforming giant conglomerates such as Am-
Companies
the Pheim Emerging Companies Balanced fund Asian market in azon.com, Microsoft,Apple and Tesla,” says Tan.
Balanced
won the Best Mixed Asset MYR Balanced-Global the long run.“ In anticipation of an economic recovery world-
in the 10-year category. wide in 2021, the US markets have been breaking
AWARD Mixed Asset MYR Balanced
> Tan - Global (10 years)
Dr Tan Chong Koay,founder and chief strate- new highs. While this bodes well for investors,
gist of Pheim,says these achievements are mainlyy Tan believes there is a need to be cautious in view FUND SIZE RM17.90 million
due to its investment philosophy hy of never being of heightened
heighte volatility inflicted by the Covid-19 FUND MANAGER Pheim Asset Management
fully invested at all times. pandemic and the resurfacing of the US-China Sdn Bhd
“We believe in trimming ourr equity exposure trade and political tensions. RETURNS FOR PERIODS 3 years 20.61
ENDED DEC 31, 2020 (%)
near market peaks to preserve capital.This phi- Tan an
and his team will leverage an active asset 5 years 33.92
losophy works well in the volatileile Asian market allocation strategy to manoeuvre market uncer- 10 years 77.00
in the long run.When the market ket continued to tainties. T The fund will also combine value and
break new highs around January ry 2020,we raised growth in investing strategies by investing in com-
cash and reduced equity exposure, re,as we thought panies tha
that have healthy growth rates and good FUND Dana Makmur Pheim
the valuations were too high and nd risky,” he says. management and are undervalued.
managem AWARDS Mixed Asset MYR Balanced
When the Dow Jones Industrial trial Average col- Pheim is positioning itself appropriately - Malaysia — Islamic
lapsed in March last year,however,
ver,the per- through sector rotation, Tan says. This will al- (10 years)
formance of Pheim’s funds stilll took a low the fund house to identify and invest Mixed Asset MYR Balanced
hit and was at its historical low..It
It was in ccompanies that have temporarily been - Malaysia — Provident
a challenging period for Tan and nd his affected by the pandemic, and are thus (10 years)
team, but they knew that it woulduld be expected to recover strongly.
ex FUND SIZE RM205.20 million
temporary. Other key risks that investors should FUND MANAGER Pheim Asset Management
Tan is thankful for the trust of its beware of include high government debt
be Sdn Bhd
investors,as they did not redeem their levels worldwide, the threat of rising
le RETURNS FOR PERIODS 3 years 25.46
capital when markets were depressed.
essed. inflation as well as heightened social
in ENDED DEC 31, 2020 (%)
5 years 51.24
“We are doing our best to educate
ucate inequality that can increase political
in
10 years 143.08
investors that crises can presentt op- rrisk, says Tan. E
Presented by
W17
APRIL 19
2021

when the risk-reward ratio looked favourable to maintain a loose monetary and fiscal policy FUND Affin Hwang Aiiman Growth
after the FBM KLCI plunged below 1,300 points. stance to ensure a sustainable economic re- AWARD Equity Malaysia - Islamic
“We were able to pick up many quality names bound from the trough last year as downside (10 years)
at distressed valuations. This rebalancing pro- risks remain. FUND SIZE (AS AT RM330.40 million
We went into cess was repeated throughout the year due to “In the near term,rising yields will inevitably DEC 31, 2020)

the constant change in the lockdown stance to weigh on ringgit bonds. We remain focused on FUND MANAGER Akmal Hassan
capital protection Lee Pak Seng
combat Covid-19.” credit quality and have a shorter duration posi-
mode early on by On the fund’s fixed-income strategy,Ahmad tioning for the fixed-income portion to protect RETURNS FOR PERIODS 3 years 28.00
raising cash levels Raziq Ab Rahman, senior portfolio manager at our holdings from rising yields,” he says. E
ENDED DEC 31, 2020 (%)
5 years 46.30
to above 20%, in AHAM, says the fund’s allocation was main- 10 years 129.00
anticipation of tained at around 40% throughout last year.The
a major market firm took a more defensive stance during the
start of the pandemic by shortening duration
FUND Affin Hwang Select
correction … We
and then gradually increasing duration Balanced
were able to
once it became clear that Bank Negara AWARD Mixed Asset MYR Balanced
pick up
Malaysia would cut interest rates. - Global — Provident
many In the near term, rising (3 and 5 years)
quality Looking ahead,Loh says the dissipat-
yields will inevitably FUND SIZE (AS AT RM272.30 million
ing risk of strict lockdowns, thanks to
names at weigh on ringgit bonds. DEC 31, 2020)
the gradual rollout of vaccines, coupled FUND MANAGER David Loh
distressed with the unprecedented scale of stim- We remain focused on
valuations.“ Ahmad Raziq Ab Rahman
ulus measures, should drive a synchro- credit quality and have
> Loh RETURNS FOR PERIODS 3 years 26.30
nised global recovery. This bodes well a shorter duration ENDED DEC 31, 2020 (%)
5 years 49.70
for corporate earnings, which positioning for the
are a key driver for equity 10 years 113.00
fixed-income
markets. portion to
On fixed income, Ah- protect our FUND Affin Hwang Select
mad Raziq says the out- holdings Opportunity
look for global growth from AWARD Equity Malaysia Diversified
and inflation is being - Provident (10 years)
rising
reshaped by the vac- FUND SIZE RM585.10 million
cine rollouts and fiscal yields..“
> Raziq FUND MANAGER Gan Eng Peng
stimulus. Central banks RETURNS FOR PERIODS 3 years 7.00
and governments around ENDED DEC 31, 2020 (%)
the world are expected 5 years 39.10
10 years 129.00

A purpose-built ecosystem that delivers

better, more consistent returns.

2021 WINNER
MALAYSIA
Bond MYR Malaysia (Provident), 10 Years
Maybank Malaysia Income Fund

Equity Malaysia Small and Mid Cap (Provident), 5 years

Maybank Malaysia SmallCap Fund

To find out more about our funds, please visit maybank-am.com.my or call +603-2297 7888.
Disclaimer: This print advertisement has been prepared solely for informational purposes and does not constitute (1) an offer to buy or sell or a solicitation of an offer to buy or sell any security or financial instrument
mentioned in this document and (2) any professional investment advice. Investors are advised to request, read and understand the respective fund's prospectus before deciding to invest. Investors should seek financial
or any relevant professional advice regarding the suitability of investing in any securities or investments based on their own particular circumstances and not on the basis of any recommendation in this presentation.
Investors should note that income from such investments, if any, may fluctuate and that each investment’s price/value may rise or fall. Past performance is not an indication of future performance.

Investors should be aware of the risks involved when investing in any investments. Please seek clarification on potential risks that may arise prior to any decision made to invest in any investments.

The Securities Commission Malaysia takes no responsibility for the contents of this print advertisement and expressly disclaims any liability whatsoever arising from this print advertisement.

Humanising Financial Services.

W18 Presented by

APRIL 19
2021

Areca continues winning streak

F
FUN
FUNDD A
Areca
reca Dividend Incom Income
ome
A
AWARD
WARD Eq
Equity
quity
ty M
Malaysia
alay
al aysi
sia Incomeme
years)
(3 years))
FU
FUN
FUND
UNND SIZE
SIZE
IZ
ZE RM53
RM
RM53.02
53.02
02 mil
million
illilion
on
FUND
D MANAGER
M N GE
MANAGER
ER D
Dan
Danny
annyy Wo
Wong

A
B Y K U E K S E R K WA N G Z H E global financial crisis,2011 European sovereign debt RETURN
RETURNS
RNSS FOR
FOR PERIODS 3 years 72.64
END
NDED DEC 31, 2020 (%)
ENDED
crisis and 2014-2016 commodity price shocks.The 5 yearrs
years NA
reca Capital Sdn Bhd bagged four firm adjusted its funds’ equity exposure during 10 years
years NA
awards at the Refinitiv Lipper Fund these periods to way below its average level of 50%.
Awards 2021. This was the fourth “We then saw a very steep selldown in March We ddecided
ecided to o FUND Areca equityTrust
time in a row that the fund house last year, during which the price of every asset rreact
eactt sw
swif
i tly to
swiftly AWARD Equity Malaysia
was taking home the awards for class just fell off the cliff. In hindsight, raising the conditions. We (3, 5 and 10 years)
Best Equity Malaysia in the three-, cash earlier was one of the right calls we made. temporarily raised our FUND SIZE RM267.77 million
five- and 10-year categories. It also achieved “We only started to deploy cash after prices cash level when the
a first by clinching the award for Best Equity fell drastically and we raised our invested cash
FUND MANAGER Danny Wong,
pandemic had not yet co-managed with UOB
Malaysia Income in the three-year category. level to about 90%.We also picked the right sec-
Areca equityTrust provided investors with a tors that turned out to be the winners last year, raised alarm bells in Asset Management
return of 33.84% over one year. In the last three including technology and healthcare,” he says. the broader investing RETURNS FOR PERIODS 3 years 68.72
ENDED DEC 31, 2020 (%)
and five years,it generated a return of 68.72% and Technology plays an important p part
art in community.” y 5 years 141.83
141.83%, respectively. Areca Dividend Income, managing clients’ expectations, leading ding to > Wong g 10 years 298.92
launched in February 2017, recorded a return of the outperformance of its funds.
72.64% for the three-year category.The defining Wong says some investors tend to want to The fund house’s investment philosophy is
factor that contributed to Areca Capital’s out- redeem their units and withdraw cash sh from based on the premise that the price movements
performance is its agile investment approach their funds when markets are down. But ut Areca of financia
financial assets are driven by a combina-
and accurate anticipation of market conditions. Capital relied on technology to quickly ly reach tion of liquidity,
liqu risk appetite and the intrinsic
Danny Wong, CEO of Areca Capital, says the out to its clients, providing them with market value of th
the underlying assets. In addition, it
firm started to sell down its equity holdings in nvested.
updates and convincing them to stay invested. seeks to optimise
opt its investment results based
January last year and raised its cash position “Even if fund managers reduced exposure osure to on the in
interplay of these factors.
before the Covid-19 pandemic wreaked havoc the market by selling down and raising cashsh levels, Areca Capital also pursues an
on global economies and markets, much ear- they could be restrained by how much cash ash they active investment strategy that
lier than some of its peers. have when clients start redeeming their eir units, emphasises the appropriate asset
“We decided to react swiftly to the conditions. thus creating continuous outflows from m funds. allocation for fast-changing mar-
We temporarily raised our cash level when the “This is where technology came in n useful. ket conditions and market cycles.
pandemic had not yet raised alarm bells in the We quickly issued updates to our investorstors via “Moving forward,we will con-
broader investing community,” he explains. WhatsApp,Zoom webinars and phone calls. lls.We tinue to apply the same investing
Wong says that was not the first time the firm also issued video recordings to our investors
stors formula that we have been using.
had acted decisively to cut market exposure by within the first day or two when the market sell- We have gone through crises, and
W
raising cash levels. Areca Capital had done the off started.This way,we managed to convince
nce o investment approach has been
our
same in other uncertain times, such as the 2008 them to keep their money with our funds.” s.” proven to work well,” states Wong. E
pro

KAF Investment Funds bags three awards

K
B Y CHUI YEE MUN FUND KAF BondG through the highly challenging period last year.
AWARD Bond MYRG(10 years) “Talent is the firm’s most valuable asset.And
AF Investment Funds Bhd (KAF) FUND SIZE RM266.07 million we believe in the diversity of our people,who, in
emerged as a winner at this year’s Re- FUND MANAGER Zarina Muhammad turn, bring to the table different views and in-
finitiv Lipper Fund Awards with three We had to discard RETURNS FOR PERIODS 3 years 18.53 sights from their various experiences and back-
winning funds. our previous ENDED DEC 31, 2020 (%) grounds.This is critical during periods of uncer-
5 years 32.23
KAF Bond won the Best Bond MYR views and biases, tainty,when we are required to adapt quickly to
10 years 118.16
(Malaysia) award in the 10-year cate- as the pandemic a fast-changing environment,” he says.
gory,while KAF Jade won the award for the Best As a result,the firm decided to hold more cash
caused some
Equity Asia Pacific (Malaysia) in the three-year FUND KAF Jade as it reacted to the pandemic.It started to invest
category. KAF Vision won the award for the Best abrupt changes more aggressively and traded more actively in the
AWARD Equity Asia Pacific —
Equity Malaysia Small & Mid Cap (Provident) in to business Malaysia (3 years) market. “We were getting better by reacting to
the 10-year category. fundamentals. FUND SIZE RM20.27 million the ebb and flow of markets. It was like dancing
Chue Kwok Yan, chief investment officer at We evaluated FUND MANAGER Tan Gan Leong to the tune of the pandemic,” says Chue.
KAF, attributes the firm’s win to a shift in mind- anew quickly and RETURNS FOR PERIODS 3 years 41.34 As a result, its three award-winning funds
set when facing the market meltdown last year spotted plenty ENDED DEC 31, 2020 (%) ended last year with returns ranging from 6% to
5 years 75.65
triggered by the Covid-19 pandemic. of mispricing 60% despite suffering a drop of more than 20%
10 years 83.92
“Last year was awash with challenging sit- opportunities.” at the beginning of last year.
uations. Market values were shrinking fast and > Chue Chue has a positive outlook on the global
sharp drops in prices caught everyone by surprise. FUND KAF Vision economy and markets this year on the back of
We knew we had to do something ething and reacted AWARD Equity Malaysia Small & Mid loose monetary policy adopted by central banks
to market conditions to safeguarduard our portfolios. Cap - Provident (10 years) globally.Fiscal support provided by governments
But we were always one step p behind. FUND SIZE RM64.52 million is also expected to be strong.
“However, our mentality changed when we FUND MANAGER Tan Gan Leong “The low interest rate environment should
started to see the market selldown
down as an oppor-r RETURNS FOR PER
PERIODS 3 years 36.63
prompt return-sensitive investors to seek high-
tunity instead of adversity. Thathat was when we ENDED DEC 31, 202
2020 (%) er performance. We think the asset manage-
5 years 49.37
could better anticipate the market,” says Chue. ment industry should be able to benefit from
It is only human to turn defensive
ensive when things 10 years 218.47 this with a growth in overall assets under
go wrong suddenly.A mindset change is therefore management,” he says.
critical during crises. “It allowed
wed us to extricate growth prospe
prospects, given favourable econom- The rollout of the Covid-19 vaccine is another
ourselves from the uncomfortabletable decisions ic conditions.
conditio But the pandemic upended boost to market performance. “The recovery is
that had to be made to turn around that pplan. already taking hold globally and locally, in tan-
the portfolio performance,” he says. ““We had to discard our previous dem with inoculations,even though this will be
Nimble and adaptable aree two views and biases, as the pandemic
view an ongoing process. Globally, funds are already
keywords that also contributed ed to caused some abrupt changes to busi-
cau rotating into assets that would benefit from the
the firm’s outperformance. Chue hue ness fundamentals. We evaluated
ne reopening of economies.The local market is no
and his team were expecting ng a anew quickly and spotted plenty of
an different,” he says.
relatively uneventful 2020.They hey mispricing opportunities,” he says.
m “The key risk, at least for us, is the muta-
were positioning themselvess to Chue also leveraged the tion of the virus, rendering existing vaccines
invest in companies with better tter sstrength of his team to ride ineffective.” E
Presented by
W19
APRIL 19
2021

UOB takes home three awards

FUND United Asean Discovery
AWARD Equity Asean – Malaysia
(3 years)
FUND SIZE RM40.74 million
RETURNS FOR PERIODS 3 years 62.26
ENDED DEC 31, 2020 (%)

A
B Y PAT H M A S U B R A M A N I A M “When governments signalled that they were 5 years 81.69
undertaking unprecedented fiscal and monetary 10 years NA
n unwavering bottom-up,fundamen- policies, the funds took advantage of the equity
tals-driven and structured team-based market weakness to accumulate and were able FUND United Income Plus
approach helped UOB Asset Manage- We aare
re flexi
exible
ibl
b e in to benefit from the swift rebound that followed.” AWARD Mixed Asset MYR
ment (M) Bhd win three awards at the recognising
recognisining
g th
that
a Sticking to their conviction was the “biggest Conservative (3 years)
Refinitiv Lipper Fund Awards 2021. different styles challenge” in the face of hostile market condi- FUND SIZE RM79.39 million
The awards are the Best Mixed Asset may work better tions, she says. “Always do your homework and RETURNS FOR PERIODS 3 years 20.58
MYR Conservative (won by United Income Plus at different times. know the company that you have invested in. If ENDED DEC 31, 2020 (%)
5 years 28.20
Fund) and Best Equity Asean (Malaysia) (won by This flexibility the market turns hostile, you can count on the
United Asean Discovery Fund) in the three-year strength of the businesses that you have invested 10 years NA
allows us to pick
category, and Best Mixed Asset MYR Balanced — in. In some cases,we believe that the company’s
Global (Malaysia) in the five-year category (won an optimal style competitive position has been enhanced.” FUND United Bond & Equity
by United Bond & Equity Strategic Trust). in achieving Lim says the funds benefited from the sharp rise Strategic Trust
CEO Lim Suet Ling says security selection has h investment
the i in the stock prices of glove manufacturers,which AWARD Mixed Asset MYR Balanced
been a significant contributor to the funds’ out- objective for our saw supernormal profits during the pandemic. – Global (5 years)
performance historically and was a key factor in clients.” But the performance of the funds was attributed FUND SIZE RM10.45 million
the awards. “We are flexible in recognising that > Lim to much more than just the glove manufacturers. RETURNS FOR PERIODS 3 years 22.40
different styles may work better at different times. “One of the big contributors to the funds’ perfor- ENDED DEC 31, 2020 (%)
5 years 39.60
This flexibility allows us to pick an optimal style in mance in recent years has been the positioning in
10 years NA
achieving the investment objective for our clients. the technology sector.The Covid-19 pandemic did
“For example, in the second half of 2020, we two main things for the technology sector — first,
started rotating from a growth-biased style to a it accelerated the digitalisation trend and second, “Apart from strong demand for products,these
more balanced approach to include value.The investors flocked to the technology sector as it was companies have also benefited from trade diver-
positive news on Covid-19 vaccines towards relatively resilient amid a global recession.” sion as a result of the US-China trade tensions.”
the end of last year triggered a rotation from The funds’ earlier positioning in technology In the light of the current economic uncer-
growth to value.The funds benefited from the resulted in significant outperformance,she adds. tainties, the fund house will continue to use the
positioning in some value sectors such as “For United Income Plus Fund,we have exposure bottom-up approach to investing and contin-
healthcare and healthcare services.” to many of the leading technology names in the ue to focus on finding opportunities to invest
Despite the selldown in equity markets world. For United Bond & Equity Strategic Trust, in quality businesses irrespective of economic
globally in March 2020 amid pandemic we have exposure to global semiconductor and conditions, says Lim.
fears, the team held on to their many leading technology names. For the United “Besides looking at security selection to un-
convictions as they believed that busi- Asean Discovery Fund,we have exposure derpin outperformance,we will also manage the
nesses would be able to withstand the to manufacturers in the tech- asset allocation actively to optimise the funds’
shock from the pandemic, says Lim. nology supply chain. returns,” she says. E
W20 Presented by

APRIL 19
2021

From left: AmanahRaya Investment Management senior From left: Eastspring Investments Bhd CEO Raymond Tang with Eastspring Al-Wara’ Investments
portfolio manager Ivan Koo Von Siong, portfolio manager Bhd equities fund manager Juliana Ramli, fixed income fund manager Mohd Umar Mohd Marzuki,
Syakirah Karim, credit analyst Adib Asilah Acryl Sani and head of investments Tan Ming Han, CEO Khadijah Sairah Ibrahim and senior fixed income fund
managing director and CEO Roszali Ramlee manager Chow Kim Seng

From left: AmFunds Management Bhd (AmInvest) head of fixed income Raymond Lew Wei Chien, CIO Wong Yew Joe, CEO Goh Wee Peng, head of equities Andrew Seah
Saik Weng and senior vice-president of fixed income Kho Hock Khoon

Public Mutual Bhd CEO Yeoh Kim Hong (on yellow stool) and the team. Two key figures in this 2019 photo are CIO Lum Ming Jang (seated, on Yeoh’s right) and head of
equity Chiang Kang Pey (seated, on Yeoh’s left)
Presented by
W21
APRIL 19
2021

Inter-Pacific Asset Management Sdn Bhd CEO Datuk Dr Nazri Khan Adam Khan (centre) and the team

From left: Kenanga Investors Bhd executive director and CEO Ismitz Matthew De Alwis,
portfolio manager Syarifah Hidayatul Akmal Syed Mustaffa, CIO Lee Sook Yee, portfolio Principal Asset Management CEO Munirah Khairuddin (left) and
manager Low Pei Yee and head of equities Christopher Kok Keng Fai CIO Patrick Chang

Pheim Asset Management founder and chief strategist Dr Tan Chong Koay (in batik shirt) and the team
W22 Presented by

APRIL 19
2021

Principal Asset Management wins one award

P
B Y O L I V E R C H R I S T OP H E R G O M E Z

rincipal Asset Management Bhd

(formerly known as CIMB-Principal
Asset Management Bhd) took home
an individual fund award at the Ref-
initiv Lipper Fund Awards 2021.
The fund management firm rode
through an unprecedented year of Covid-19-en-
forced economic lockdowns to bag an award
in the Equity Asia Pacific ex-Japan (Provident)
universe in the 10-year returns category for its
Principal Asia Titans fund. It returned just shy
of 140% during the period under review.
CEO Munirah Khairuddin attributes Princi-
pal’s success to its fund management process,
coupled with its global expertise and capabil-
ities. “Our team’s local and regional market
understanding also created real value for our
clients,” she says.
One of the most prominent fund manage-
ment firms in the world, US-based Principal
has had a presence in Malaysia for some years
now. One advantage in having a regional team, One of the more notable calls we made was to invest
according to Munirah, is being able to leverage
into new economy sectors such as e-commerce
on each other’s deep local insights to facili-
tate channel checks and stock reads through a companies. With the lockdown restrictions in place,
cross-fertilisation of ideas, coupled with Princi- we deduced it would accelerate the trend for people
pal’s own fundamental, momentum and value to use digital means for personal shopping.”
(FMV) model. > Munirah
Despite the market crash in the first half
of 2020, the clincher for Principal came about
because of its trust in the long-term process, as
well as the strategies and processes that Mu- Ultimately, it was faith in the processes, business continuity,” says Munirah.
nirah and her team had in place up to that point. as well as the strength to hold fast through “One of the challenges we faced, just like
“Our investment philosophy is simple.We be- even unforeseen global disasters, that allowed other companies, was trying to operate safely
lieve consistent alpha is generated when we achieve Principal to thrive even as the entire economy and economically at the time. Thankfully, we
thought leadership through early identification of ground to a halt. were able to do so via technology and various
long-term growth prospects of companies. “The pandemic has caused widespread digital platforms.”
“We focus on both absolute and total returns, concern and economic hardship for consum- The firm then engaged in continuous dia-
rigorous research,independent thinking,paired ers, businesses and communities throughout logue with its customers through a combination
with decisive action, as well as a focus on low the world. In March last year, we spent the of educational content, webinars, relationship
volatility and high alpha, all of which are un- bulk of our time responding to the effects calls as well as social media activity, as a means
constrained by benchmark [indices].” of the pandemic on our own workforce and to build their confidence and reassure them

RHB’s fund wins first Refinitiv Lipper award

R
B Y TA N Z H A I Y U N The pandemic presented a challenging mar- the lack of companies that could offer growth
ket for the fund house to navigate last year, de- in earnings,” she adds.
HB Asset Management Sdn Bhd’s spite the recovery that occurred following the Cash flow issues in companies due to col-
RHB Thematic Growth Fund won sharp dip in March 2020. lapsed demand and uncertainties
the award for Best Mixed Asset MYR “Markets have recovered well from the lows in the economy contributed to
Asset allocation
Flexible (Provident) in the three-year in March 2020 despite the severe impact of RHB Asset Management’s de-
category at the Refinitiv Lipper Fund Covid-19 on the global markets. Equity markets contributed cision to not be fully invested
Awards 2021. It was the first Refini- throughout the world have continued to climb to the fund’s in the market last year.
tiv Lipper award for the fund, which invests in higher, aided by stimulus packages announced performance as Additionally, the fund
securities of Malaysian companies that bene- by various governments and aggressive cuts in the fund was not house avoided under-
fit from evolving domestic and global trends. interest rates by central banks,” says Ong. fully invested weighted sectors that
Eliza Ong, CEO of RHB Asset Management, “It was challenging to make fundamental in 2020 due had been negatively im-
attributes the success to good sector selection. investment decisions at that point, as most to the lack of pacted by Covid-19.This
“We took the view early on that the demand in valuations had peaked while earnings visibility companies minimised the neg-
the healthcare sector, especially for exporters, remained weak. The possibility of more down- that could ative impact from
would rise exponentially and lead to higher side risks as well as ongoing external concerns offer these sectors.The
selling prices of their products and hence, prof- like trade tensions remained.” fund house also
growth in
itability for these companies. Against this backdrop, the RHB Thematic actively traded
“The fund took an overweight view of this Growth Fund successfully generated a return earnings.” and rebalanced
sector in as early as March 2020. The Covid-19 of 49.44% by end-2020. This was possible be- > Ong its portfolio by
pandemic that led to lockdowns in many parts cause the fund house focused on stocks with increasing the
of the world further fuelled demand in the earnings growth, as it believed that only sectors weightage of
healthcare and related sectors,which delivered that could deliver growth could outperform the healthcare-re-
strong earnings growth.” market, says Ong. lated sectors and
The fund house capitalised on the mispricing “Growth investments outperformed val- decreasing that of
between price and valuation by combining ue investments significantly in the first nine sectors with neg-
bottom-up stock picks with top-down consid- months of 2020 as earnings from healthcare-re- ative earnings or
erations, says Ong, adding that this strategy lated sectors beat expectations.Asset allocation those that had cash
allowed the fund to generate consistent and also contributed to the fund’s performance as flow issues.
superior returns over the medium to long term. the fund was not fully invested in 2020 due to Moving forward,
Presented by
FUND Principal Asia Titans
AWARD Equity Asia Pacific ex Japan
– Provident (10 years)
FUND SIZE (AS AT RM90.50 million
FEB 28, 2021)
FUND MANAGER Jeffrey Chong
RETURNS FOR PERIODS 3 years 27.69
ENDED DEC 31, 2020 (%)
5 years 74.99
10 years 139.22
through the challenging times of 2020.
“Of course, being active managers, Principal
could not have come out on top without some
quick thinking and shrewd foresight right at
the start of the pandemic.
“One of the more notable calls we made was
to invest into new economy sectors such as
e-commerce companies.With the lockdown re-
strictions in place,we deduced it would acceler-
ate the trend for people to use digital means for
personal shopping, where, previously, it would
have taken much more time to break out of tra-
ditional shopping habits, in malls, for example.
“The opportunity was there for most e-com-
merce companies to incentivise customers to
shop online while stuck at home. As a result,
these companies were able to capture market
share much faster than expected.”
Perhaps unsurprisingly, as at February 2021,
the fund’s top holdings included Tencent Hold-
ings Ltd, SEA Ltd and Alibaba Group Holding
Ltd. There were also semiconductor and tech-
nology companies such as Taiwan Semicon-
ductor Manufacturing Co Ltd and Samsung
Electronics Co Ltd.
Munirah is hopeful that the economy will
recover and, with it, the fortunes of Principal
and its investors will continue to improve.
“Our winning fund is likely to invest more
broadly relative to last year.The fund will be less
concentrated.We expect more companies to do
well, as we anticipate a synchronised global re-
covery is likely to follow,” she concludes. E least five equity, five bond and three mixed-asset portfolios
FUND RHB Thematic Growth
AWARD Mixed Asset MYR Flexible –
Provident (3 years)
FUND SIZE RM69.91 million
FUND MANAGER Mike Lai Teck Voon
RETURNS FOR PERIODS 3 years 41.90
ENDED DEC 31, 2020 (%)
5 years 64.26
10 years 132.48
RHB Asset Management believes that an eco-
nomic recovery is underway.The rollout of Cov-
id-19 vaccines and easing of movement restric-
tions will contribute to an improved economy
by the second half of 2021, Ong observes.
“We deployed [funds] into cyclical stocks and
value stocks by the fourth quarter of 2020 and
continued to do so in the beginning of 2021.”
The fund house may change its investing
style going forward, she adds. “Although the
growth investing style outperformed value
investing due to the scarcity of sectors that
could offer earnings growth in 2020,we believe
that the cyclical and value investment styles
will outperform growth investing in 2021 or
post-Covid-19.”
The fund house believes that growth outper-
formance has peaked. Sectors with low price-to-
book ratios and strong earnings revisions will
be its preferred picks for 2021. E For a detailed explanation, please read the Lipper Leaders methodology document at http://lipperalpha.refinitiv.com/lipper/our-methodology/
Awards methodology
The awards methodology and guidelines for the
Refinitiv Lipper Fund Awards are provided below:
GENERAL METHODOLOGY
Criteria (cumulative)
• Funds registered for sale in the respective country as at
the end of the calendar year of the respective evaluation
year.
• At least 36 months of performance history as at the end
of the calendar year of the respective evaluation year.
• Lipper Global Classifications with at least 10 distinct
portfolios based on the primary share class definition,
excluding residual classifications, institutional and
other non-retail funds; private, closed-end,
exchange-traded, insurance and linked funds.
• Asset classes: equity, bond, mixed-asset, commodity
and alternatives. Absolute return funds screen over all
asset types except real estate.
Fund classification awards
The currency for the calculation corresponds to the currency
of the country for which the awards are calculated and relies
on monthly data. Classification averages are calculated with
all eligible share classes for each eligible classification.
The calculation periods extend over 36, 60 and 120
months. The highest Lipper Leader for Consistent Return
(Effective Return) value within each eligible classification
determines the fund classification winner over three, five
or 10 years. For a detailed explanation, please review the
Lipper Leader methodology document.
Asset class group awards
Asset class group awards will be given to the best large and
small groups separately. Large fund family groups with at
least five equity, five bond or three mixed-asset portfolios
SPECIFIC METHODOLOGY ISSUES
Asia
• Because of the small market size, the Asian countries will
not make a distinction between large and small groups for
the single asset class and overall group awards.
• To be eligible for an asset class group award, the groups
will need to have at least three distinct portfolios in one
of the asset classes: equity, bond or mixed-asset.
• To be eligible for an overall group award, the groups
will need to have at least three equity, three bond and
three mixed-asset funds.
• Classification awards will be handed out to
classifications with at least five distinct portfolios.
• Malaysia: The regular universe excludes the Employees
Provident Fund-approved and Islamic funds. Separate
classification and group awards will be handed out to
Islamic and EPF-approved funds within classifications
meeting the aforementioned criteria.
W23
APRIL 19
2021
in the respective asset classes are eligible for a group
award. Small fund family groups will need to have at least
three distinct portfolios in one of the asset classes – equity,
bond or mixed-asset.
The lowest average decile rank of the three years’
Consistent Return measure of the eligible funds per asset
class and group will determine the asset class group
award winner over the three-year period. In cases of
identical results, the lower average percentile rank will
determine the winner.
Overall group award
An overall group award will be given to the best large and
small group separately. Large fund family groups with at
are eligible for an overall group award. Small fund family
groups will need to have at least three equity, three bond
and three mixed-asset portfolios.
An overall group award will be given to the group with
the lowest average decile ranking of its respective asset
class results based on the methodology described above.
In cases of identical results, the lower average percentile
rank will determine the winner. No asset class and/or
overall group awards are handed out if there are fewer
than three competing companies.
Asset class and overall group awards are given to
the company that is responsible for establishing the
fund by appointing the fund management company, and
promoting and/or distributing the fund, the brand of the
fund and the product range. This company is also referred
to as the promoter or sponsor company.
Global Islamic
• All Islamic funds globally within Lipper Global
Classifications with at least five distinct mutual
funds over the respective time frame.
• Calculation currency is the US dollar.
• No distinction between large and small groups for
the single asset class and overall group awards.
• To be eligible for an asset class group award, the
groups will need to have at least three distinct
portfolios in one of the asset classes: equity, bond
or mixed-asset.
• To be eligible for an overall group award, the
groups will need to have at least three equity,
three bond and three mixed-asset funds.
• The calculation periods are until the end of
November of the respective evaluation year.
W24
APRIL 19
2021
Manulife Investment
Management bags two awards
M
B Y JOTHAM LIM
anulife Investment Manage-
ment (M) Bhd nabbed two fund
awards at the Refinitiv Lipper
Fund Awards 2021.
Manulife Investment-HW
Flexi won the award for Best
Mixed Asset MYR Flexible (Provident) in the
10-year category,which saw a return of 143.96%,
while Manulife Investment Al-Fauzan took
home the award for Best Equity Malaysia In-
come (Islamic) in the 10-year category, with
a return of 80.64%.
CEO Jason Chong attributes the funds’
success to a dynamic investment team that
is active in sharing ideas and quick in deci-
sion-making, which allowed them to adapt
to rapidly shifting market conditions. “We
work as a team, and no idea is too small or
too big,” he says.
“One advantage in having a regional team
is that we leverage each other’s deep local in-
sights for channel checks and sector or stock
read-throughs. A climate of transparency
and trust in the regional team allows for a
cross-fertilisation of ideas.”
Chong describes 2020 as a tumultuous year
in which they witnessed not only extreme
swings in share prices but also investor sen-
timent and emotions as well. Remaining calm
Two awards for Maybank Asset Management
M
B Y JOTHAM LIM
aybank Asset Management Sdn
Bhd once again landed a win-
ning spot at the Refinitiv Lip-
per Fund Awards 2021, with two
fund awards this year.
Maybank Malaysia Income
(MMI) took home the award for Best Bond
MYR (Provident) in the 10-year category, with
a return of 116.77% over the period. Maybank
Malaysia SmallCap (MMSC) won the award
for Best Equity Malaysia Small and Mid-Cap
(Provident) in the five-year category, with a
return of 76.61% over the period.
CEO Ahmad Najib Nazlan says making con-
trarian calls in its investment strategy enabled
both MMI and MMSC to outperform their in-
dustry peers. “For MMI, we turned defensive
in January 2020 and decided to have higher
levels of cash to allow us to be agile in case of
any market events due to the uncertainties
surrounding the Covid-19 pandemic. Due to
that stance, during the sell-off in March, we
were able to add positions and benefit from
the wild swings.
“For MMSC, we had a very strong convic-
tion in the healthcare sector after news of the
virus broke out in China heading into 2020.
That conviction was vital as it contributed very
positively to the portfolio. Those healthcare
names were small-cap stocks when we invest-
ed, but have now increased their market cap.”
Ahmad Najib points to the investment
team’s agility, teamwork and leadership as
being key contributors to the success of the
two funds. He says that from the onset of the
pandemic and lockdowns, the team mobilised
daily virtual meetings to discuss and plan
Presented by
and rational was a challenge in a panicked “Companies with sound balance sheets
market, particularly when dealing with mul- and strong management are likely to with-
tiple uncertainties due to the far-reaching stand the challenging economic conditions
impact of the pandemic, he says. of last year. One example would be the tele-
To address this issue, the team had to be One advantage in communications sector, and even alternative
disciplined in adhering to their investment having g a regional
g industries such as the glove sector, which
fundamentals and not let periods of extreme team is that we are enjoying stro
strong earnings that
market sentiments affect their investment leverage each could potenti
potentially translate into
decisions. “When it became clearer that the better dividend
divid payouts later,”
other’s deep
pandemic was turning into a black swan says Chon
Chong.
event, we decided to drastically adjust our local insights forr Moving into 2021, he
Movin
strategy — first by prioritising the return of channel
h l checks
h ks highlights a shift in invest-
capital,” says Chong. and sector or ment focus — from prioritis-
“This involved locking in gains in holdings stock read- ing companies
compan with earnings
that had priced in earnings growth. In addi- throughs.” certainty las
last year to prioritis-
tion to that, the cash would allow us to pick > Chong ing those with
wit strong earnings
and choose fundamentally strong companies growth momentum. “We
at beaten-down prices and valuations.” will look
lo for stocks that
For Manulife Investment-HW Flexi, Chong offer strong earnings
points out that the rebalancing exercises were recovery and growth
reco
concentrated in the first and fourth quarters in the light of an an-
of last year. 1Q2020 involved increasing its ticipated economic
ti
cash position before the market selldown to recovery, resump-
re
protect the fund’s position while providing tion
t of economic
ammunition to capitalise on bargain-hunt- activities and po-
ing opportunities. tential reopening
In 4Q2020, the team rebalanced the port- of borders. Un-
folio to support post-pandemic beneficiaries der such circum-
once it became clear that there was light at stances, compa-
the end of the tunnel when it came to the nies that did not
pandemic. fare well in 2020
their fund management strategies, which He says that due to the decision to position
allowed them to look at opportunities in dis- MMI to be nimble and agile early on, the in-
located markets. vestment team managed their liquidity well
“Due to our proactive engagements, we and kept cash at a minimum during the sell-
were able to turn ‘defensive’ early on. When off — opting to capture new opportunities in
the markets were dislocated, we were ready Due to our the bond market instead.
to go on the offensive and capitalise on those proactive As for MMSC, Ahmad Najib explains that
opportunities at attractive valuations,” he adds. engagements, the team conducted several rebalancing ex-
However, Ahmad Najib highlights that we were able to ercises towards the second half of 2020, as
it was challenging to make contrarian calls turn ‘defensive’ the market shifted away from the health-
and persist with that view while managing early on.When care sector. However, since the fund got into
investors’ expectations. He says that when the markets the sector early, the team was able to raise a
the team decided to position MMI defensive- were dislocated, significant amount of cash and took
ly, investors were concerned about a laggard we were ready profit from that strategy.
performance. to go on the Moving forward, he expects
“Moving into 2020, the market was ex- a global growth recovery this
offensive and
pecting GDP performance to be better at 4.8% year. But he foresees a vola-
compared with 4.7% in 2019 on a potential capitalise tile market, with fiscal poli-
meaningful resolution to the US-China trade on those cies playing an increasingly
war. Hence, having a defensive call may have opportunities critical role in supporting
dragged our performance compared with our at attractive growth.
peers,” he adds. valuations.” “For MMI, given the cur-
However, as it turned out, 2020 saw a con- > Ahmad Najib rent volatile situation in the
traction in GDP. bond markets, we will be
“Similarly with MMSC, when we decid- positioned defen-
ed to increase positions in healthcare and sively in the
technology, investors questioned our stance near term
as they were unsure about our view. Despite by reduc-
the immense pressure from our investors, ing our
we maintained our call,” says Ahmad Najib. ‘govvies’,
“We continued to engage with and com-
municate our strategies to our investors and
provided clarity and justifications for our
calls. When the sell-off happened, it was chal-
lenging to stick to our conviction. But we did
not panic and instead, focused on the funda-
mentals as well as the long-term objectives of
the funds. As a result, we were able to deliver
better returns to our investors.”
Presented by
W25
APRIL 19
2021

AmanahRaya Investment
Management wins four awards

A
FUND Manulife Investment-HW B Y IRIANI AMIRUDIN
Flexi FUND AmanahRaya Unit Trust
AWARD Mixed Asset MYR Flexible manahRaya Investment Man- AWARD Bond MYR (3 and 5 years)
– Provident (10 years) agement Sdn Bhd (ARIM) FUND SIZE RM112.00 million
FUND SIZE RM349.45 million took home four fund awards FUND MANAGER Ivan Koo Von Siong
FUND MANAGER Affin Hwang Asset at this year’s Refinitiv Lip-
Management Bhd per Fund Awards. Amanah- RETURNS FOR THE 3 years 23.82
PERIODS ENDED
RETURNS FOR PERIODS 3 years 24.84 Raya Unit Trust snagged the DEC 31, 2020 (%) 5 years 35.46
ENDED DEC 31, 2020(%) awards for Best Bond (MYR) in the three-
5 years 54.10 10 years 65.50
and five-year categories while Amanah-
10 years 143.96
Raya Syariah Trust won the awards for
Best Bond MYR (Islamic) in the three- FUND AmanahRaya Syariah Trust
FUND Manulife Investment and five-year categories. AWARD Bond MYR - Islamic
Al-Fauzan Managing director and CEO Roszali (3 and 5 years)
AWARD Equity Malaysia Income – Ramlee attributes the achievements to FUND SIZE RM912.00 million
Islamic (10 years) the team’s investment strategy, which FUND MANAGER Ivan Koo Von Siong
FUND SIZE RM429.15 million is a blend of both active and passive ap- RETURNS FOR THE 3 years 26.93
proaches. “Our fixed-income investment PERIODS ENDED
FUND MANAGER Manulife Investment DEC 31, 2020 (%) 5 years 39.43
team has the belief that the market is
Management (M) Bhd 10 years 69.79
not always efficient. We pursue active
RETURNS FOR PERIODS 3 years 5.51 strategies in market segments where we
ENDED DEC 31, 2020(%)
5 years 15.35 hold a strong alpha conviction. Howev- Roszali says that moving forward,
10 years 80.64 er, passive strategies are adopted when fixed-income investors should brace for
there is an absence of such a strong lower returns this year. “The market will
are likely to emerge as winners,” he says. conviction,” he says. likely undergo a recovery in the next 12
“Apart from positioning in such ‘econom- Asset allocation is another key to months, with interest rates normalis-
Our asset
ic reopening’ stocks, we continue to look for ARIM’s outperformance. “It is impor- ing, but a full recovery may take slight-
opportunities to invest in stocks that will tant to diversify our investments amid allocation ly longer.”
benefit from long-term structural investment market volatility. Our asset allocation decisions consider The fund house may reduce its portfo-
themes such as digitalisation, climate change decisions consider prevailing market prevailing market lio durations and be slightly overweight
and globalisation.” E conditions to avoid underperformance. conditions to avoid in cash, he adds. “The wider fiscal defi-
And they capture various opportunities underperformance. cit of the Malaysian government and
during market up cycles,” says Roszali. And they oversupply of government bonds are key
Fundamental analysis conducted by capture various risks that fixed-income investors should
ARIM’s investment team is equally vital opportunities keep in mind.” E

to the firm’s win, he adds. Such anal- during market up

ysis covers macroeconomics, interest cycles.”
rate view, sector analysis and credit
> Roszali
evaluation, which all play an essential
part in producing superior investment
outcomes.
FUND Maybank Malaysia Income Roszali is particularly proud of the
AWARD Bond MYR – Provident firm’s active investment approach that
(10 years) played out well in last year’s market
FUND SIZE RM80.83 million turmoil. For instance, he and his team
FUND MANAGER Maybank Asset actively rebalanced their investment
Management Sdn Bhd portfolios last year according to their
RETURNS FOR PERIODS 3 years 17.24 outlook for interest rates. As a result,
ENDED DEC 31, 2020 (%)
5 years 26.57
they extended the investment portfolio
duration and overweight sukuk holdings
10 years 116.77
prior to the central bank’s interest rate
cuts last year.
FUND Maybank Malaysia “Our fund manager and credit team
SmallCap actively discussed and managed the
AWARD Equity Malaysia Small & Mid portfolio over time. And the portfolio’s
Cap – Provident (5 years) turnover ratio of two of our award-win-
FUND SIZE RM23.99 million ning funds were 2.56 times and 2.79
FUND MANAGER Maybank Asset times last year. We believe our active
Management Sdn Bhd investment approach contributed to
RETURNS FOR PERIODS 3 years 40.20 our outperformance,” he says.
ENDED DEC 31, 2020 (%) In March last year, the AmanahRaya
5 years 76.61
Syariah Trust fund suffered about 2% to
10 years 137.75
3% downside, but it took less than four
weeks to recover the losses. The fund’s
or government-guaranteed bond holdings. returns also ended up higher at the end
We will also cut our duration and be very of the year, says Roszali.
mindful of adding longer-duration positions. “Like our peers, our fund suffered
In the longer term, we are still positive on during the market sell-off in March last
Malaysian fixed income and will be nimble, year. But we were one of the first to re-
depending on the market conditions,” says cover when the market turned around,”
Ahmad Najib. he adds.
“For MMSC, within the same thesis of ex- In terms of the increasing impor-
pected global growth recovery, we have taken tance of the environmental, social and
some profit from our high conviction ideas corporate governance (ESG) factor in
last year and increased our position in some investing, AmanahRaya is currently
recovery themes. And we will be positioned a developing its strategies for the firm’s
bit more defensively in this current volatili- fixed-income and equity investments.
ty to ensure we have more agility to capture Nevertheless, the firm has already in-
potential opportunities that arise from new cluded several ESG-compliant sukuk in
ideas in 2021.” E its portfolios.
W26 Presented by

APRIL 19
2021

Eastspring Investments takes home two awards

E
B Y CHUI YEE MUN sector,” says fixed income fund manager Chow FUND Eastspring Investments
Kim Seng. Dana Dinamik
astspring Investments Bhd bagged two Despite extremely challenging market con- AWARD Mixed Asset MYR Flexible
awards at the Refinitiv Lipper Fund ditions last year, Dana Dinamik and Dana — Islamic (10 years)
Awards 2021. Eastspring Investments al-Islah generated returns of 14.77% and 12.05% FUND SIZE RM167.36 million
Dana Dinamik won the award for Best Prices may respectively. Over a 10-year period, they pro- FUND MANAGER Juliana Ramli
Mixed Asset MYR Flexible (Islamic) in overshoot vided investors with returns of 129.51% and Chow Kim Seng
the 10-year category while Eastspring sometimes 58.44% respectively. RETURNS FOR THE 3 years 14.56
Investments Dana al-Islah won the award for Juliana attributes the fund house’s overall PERIODS ENDED
and become DEC 31, 2020 (%) 5 years 30.74
Best Mixed Asset MYR Conservative (Provident), expensive. We success to its disciplined and research-driven 10 years 129.51
also in the 10-year category. were disciplined in investment approach. “We derive intrinsic
Juliana Ramli, equity fund manager of East- value based on valuation, growth and cash
taking profit and FUND Eastspring Investments
spring Al-Wara’ Investments Bhd, says Dana flow analysis, and we have a quality bias for
Dinamik (a balanced fund) outperformed its continued to look companies with a strong balance sheet, good Dana al-Islah
peers by being overweight on equities last year. for undervalued earnings visibility and sound management,” AWARD Mixed Asset MYR
Its allocation to the glove, semiconductor and stocks.” she adds. Conservative— Provident
telecommunications sectors also contributed > Juliana “Security mispricing driven by greed and (10 years)
to the fund’s success. fear is an enduring phenomenon,which can be FUND SIZE RM23.28 million
“We shifted our portfolio towards cycli- successfully exploi
exploited through our long-term FUND MANAGER Chow Kim Seng
cal and recovery plays towards the end d of the investment approa
approach. Value is also created by Juliana Ramli
weight
year by making a quick switch to overweight cyclical extremities in interest rates and cred- RETURNS FOR THE 3 years 17.07
the financial sectors. We also continued ued to it markets. Or ther
there are shifts in investor risk PERIODS ENDED
DEC 31, 2020 (%) 5 years 25.95
focus on stocks that generate alpha. That
hat was s
perception under specifi c market conditions 10 years 58.44
when the economic reopening theme became ecame that result in the m
mispricing of assets relative
stronger on the back of more positive vaccine
accine to their fundamen
fundamentals.”
news,” she says. Eastspring will
wi continue to remain fo- with the rolling out of Covid-19 vaccines. Re-
“Prices may overshoot sometimes and be- cused and stay ahead
ahe of the curve despite the covery plays remain the main theme this year
come expensive.We were disciplined in taking team working from home, says Juliana. “The in the equity market, but selection is impor-
profit and continued to look for undervalued
valued team continues to meet
m online regularly while tant as valuations may overshoot fundamen-
stocks.” adapting to th
the movement restrictions. tals, says Juliana.
Interestingly, Dana al-Islah, which ch is We have als
also stepped up our investor On the fixed income side, she expects bond
another balanced fund, adopted a slightly tly communication efforts to keep them
communi yields to reverse in a relatively volatile envi-
different investment strategy last year to abreast oof the market updates and ronment as markets return to pre-pandemic
achieve outperformance. “The fund was their p
portfolios.” performance. “Pockets of trading opportuni-
overweight on fixed income during the Moving forward, the fund
Mo ties are expected to present themselves amid
earlier part of the year before it gradually
ally house expects a recovery this
hou market volatility. We will also see a recovery
increased its allocation to equities. It also year as the global and local
ye in credit as lockdowns are gradually lifted in
benefited from the allocation to the glove love eeconomy gradually reopens the near future,” she says. E

Inter-Pacific Asset Management

wins award for best mixed asset fund

I
B Y JOTHAM LIM fixed-income securities and money market FUND InterPac Dynamic Equity
instruments to meet its objectives over the AWARD Mixed Asset MYR Flexible
nter-Pacific Asset Management Sdn Bhd’s medium to long term. — Malaysia (10 years)
(InterPac) InterPac Dynamic Equity fund Nazri points out that one of the largest
won the award for Best Mixed Asset MYR hurdles his team had to overcome last year
FUND SIZE RM3.99 million
We took a FUND MANAGER Inter-Pacific Asset
Flexible (Malaysia) in the 10-year category. was the uncertainty caused by the Covid-19
The fund generated a total return of 55.15% calculated risk outbreak. “The CBOE Volatility Index (VIX) Management Sdn Bhd
during the period. in managing hit its historical high in 2020 — an indication RETURNS FOR THE 3 years -1.89
PERIODS ENDED
CEO Datuk Dr Nazri Khan says the team’s our investment that global market players were on hold, due DEC 31, 2020 (%) 5 years 41.62
dynamic and tactical investment strategy, activities, which is to a fear of uncertainty. However, to us, we saw 10 years 55.15
as well as a combination of well-executed a combination of opportunities in the situation. We made the
fundamental and technical analysis, were fundamental and uncommon decision to be more proactive by
key contributors to the fund’s success. “Com- technical analysis.” allocating assets to technology, consumer and and to display proper leadership and moti-
pared with the traditional approach of buy- > Nazri healthcare stocks,” he says. vate everyone on the team.
ing stocks at low prices and d selling them at Our major concern
“Our con was to maintain our Despite the challenges, Nazri is bullish
their peak, we took a calculated
ated risk in man- positive returns andan retain investors. There on the outlook for the next 12 months. He
aging our investment activities,
vities, which is a were times when w we faced difficulties as the points out that the FBM KLCI has breached
combination of fundamental tal and technical market experienced
experience minor corrections. How- the 1,600-point threshold — indicating a
analysis. This non-traditional
onal strategy has ever, it has not affected
e our overall strong per- V-shaped economic recovery.
set us apart from our peers by a large margin. formance as we h have policies to minimise “The pandemic should be over soon, es-
“Through fundamental analysis, we iden- risks and secure early profits.” pecially after the rollout of the vaccination
tify and determine the valuee and growth rate Nazri says tha
that as CEO, it was not easy programmes. Governments around the world
of the stock. Technical analysis
lysis allows us to to execute the trading
t plans. There were are vaccinating their people in stages, which
understand market behaviour iour and capture times when the team had to go the extra is a key factor in reopening business activ-
opportunities at the right time according to mile and be more innovative in discovering ities, especially in the tourism and aviation
developments in trends.” investment opportunities in the midst sectors,” he says.
According to the information
mation of unce
uncertainty. “Understanding this gives us an advan-
on the fund, InterPac Dynamic
namic Hence,
Hen he highlights the im- tage in positioning ourselves in promising
Equity seeks to maximise cap- porta
portance of being accountable shariah-compliant stock selections with great
ital gains by investing princi-
inci- as the
th leader of the investment potential at an early stage, in order to garner
pally in local stocks. It hasas a team — to be proactive and
tea the maximum potential returns. We are op-
flexible asset allocation strat-
trat- firm in making decisions
fir timistic and look forward to more positive
egy that enables it to investt in that will benefit everyone
th developments in the market.” E