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ASEAN STOCK WATCH Asean Affairs   12 January 2011

ASEAN to Rally

Shayne Heffernan

ASEAN is Set for a Rally today after falling from recent highs, overnight in the USA Energy shares helped the Dow and S&P 500 end a three-day losing streak on Tuesday, even as investors worried rising fuel costs will undercut economic growth.

The Dow Jones industrial average gained 34.36 points, or 0.30 per cent, to 11,671.81, according to the latest available figures. The Standard & Poor's 500 gained 4.72 points, or 0.37 per cent, to 1274.47. The Nasdaq Composite gained 9.03 points, or 0.33 per cent, to 2716.83.

Best Buys Today are Golden Agri, Tiger Airways, PTT, Bank Negara

In Singapore shares closed higher on Tuesday, with the benchmark Straits Times Index at 3,241.49, up 0.38 per cent, or 12.22 points.

About 2.04 billion shares exchanged hands.

Gainers beat losers 290 to 216.

Shayne Heffernan issues a strong buy on Tiger Airways Singapore

Tiger carried 32 per cent more passengers in 2010.

Tiger Airways carried 555,000 passengers in December, up from 456,000 in the same month a year earlier, it said in a statement.

Tiger Airways Holdings Limited (Tiger Airways), formerly Tiger Airways Holdings Pte. Ltd., is a Singapore-based company.

The Company is engaged in airline and aircraft management. The Company provides various ancillary services and generates additional revenue through the provision of additional products and services, connected with its core air passenger service.

Its flight-related services include in-flight sale of beverages, food and merchandise. Through its Website, the Company offers its passengers a range of Tiger Add-On products, such as luggage upsize, seat selector and sports equipment check-in.

The Company’s subsidiaries are Tiger Airways Singapore Pte. Ltd. and Tiger Airways Australia Pty Limited.

It had an average load factor of 91 per cent across Asia and Australia last month, compared with 90 per cent in December 2009.

For the 12 months to Dec 31, 2010, Tiger carried 5.8 million passengers, a 32 per cent rise over 2009.

Tiger Airways, part-owned by Singapore Airlines , said it will take delivery of nine new Airbus A320 aircraft over the next 12 months, representing a fleet increase of 36 per cent over its current fleet of 25 aircraft.

Shayne Heffernan has placed a strong buy on the Singapore listed, Indonesian Agriculture Company Golden Agri-Resources Ltd

Golden Agri-Resources Ltd is the world's second largest palm oil plantation with a total planted area of 435,000 hectares (including small holders) as at 30 September 2010, located in Indonesia. It has integrated operations focused on the production of palm-based edible oil and fat products.

Founded in 1996, GAR is listed on the Singapore Exchange since 1999 with a market capitalisation of US$5 billion as at 30 September 2010. Flambo International Ltd, an investment company, is GAR’s largest shareholder, with a 49% stake in the company. GAR has several subsidiaries, including PT SMART Tbk (“SMART”) and PT Ivo Mas Tunggal. SMART listed its shares on the Indonesia Stock Exchange in 1992.

GAR is focused on sustainable palm oil production. Its primary activities include cultivating and harvesting of oil palm trees; processing of fresh fruit bunch into crude palm oil ("CPO") and palm kernel; and refining CPO into value-added products such as cooking oil, margarine and shortening. Through its subsidiaries, GAR operates 36 palm oil processing mills, four refineries and six kernel crushing plants. It also has an integrated operation in China including a deep sea port, oilseed crushing plants, production capabilities for refined edible oil products as well as other food products such as noodles.

Seedlings: Good quality seeds are crucial for the long-term productivity of our plantations. One of our subsidiaries, PT Ivo Mas Tunggal, has a strategic partnership with Dami Australia Pty Ltd, to produce high yielding seeds originating from Papua New Guinea, through its joint venture company, PT Dami Mas Sejahtera. The production capacity of this company can support our plantation expansion plan.

Plantations: We cultivate oil palm plantations with a total area of approximately 435,000 hectares (including plasma) with an annual fresh fruit bunches yield of 23.1 tonnes per hectare in 2009. Our nucleus plantations comprise 79 percent of total hectarage.

Extraction: Our mills extract crude palm oil and palm kernel from the fresh fruit bunches, with a combined capacity of 9,270,000 tonnes per annum.

The Stock Exchange of Thailand (SET) composite index lost 4.64 points or 0.46 per cent to close at 1,013.39 points on Tuesday. The trade value was 34.40 billion baht, with 2.98 billion shares traded.

Top five most active values were as follows;

SCB closed at 97.75 baht, down by 1.75 baht or 1.76per cent.

BBL closed at 159.50 baht, down by 1.50 baht or 0.93per cent.

PTT closed at 319.00 baht, up by 1.00 baht or 0.31per cent.

TOP closed at 71.00 baht, down by 0.75 baht or 1.05per cent.

PTTCH closed at 144.50 baht, up by 0.50 baht or 0.35per cent.

In Manila the market had the second biggest drop this year over concerns of the economic strength of the country over the long term and the debt crisis in Europe.

The bellwether Philippine Stock Exchange index tumbled by 1.95 percent or 80.21 points to 4,032.37. The broader all-shares index declined by 1.46 percent or 44.12 points to 2,965.60.

Trading volume reached 1.84 billion shares valued at P5.39 billion ($121 million) with 104 issues shedding their value and only 49 stocks bucking the sell down. A total of 32 shares closed unchanged. All six counters tracked the performance of the composite index.

"Another broad based selling caused the stock market to crash for the second straight day probably on concerns about the effect of higher than expected inflation for the Philippines this year," brokerage DBP-Daiwa Securities, Inc. said.

The result of Monday's treasury bill auctions hinted that although investors remain optimistic about the short-term performance of the economy on the back of the declining interest rate, they're unsure if such growth can be sustained.

Overseas, the spiking of inflation in India and Indonesia has already raised the prospects of monetary tightening.

In Kuala Lumpur the FTSE Bursa Malaysia KLCI (FBM KLCI) shed 0.58 point, or 0.04 per cent, to 1,562.94 after opening 4.25 points lower at 1,559.27.

A dealer said the market was expected to be in correction mode this week after the strong rally last week.

"The rising concern over the euro zone's debt problem also encouraged investors to trim their positions.

"However, the market fundamentals remain firm backed by positive domestic developments," he said.

Prime Minister Datuk Seri Najib Tun Razak on Tuesday announced 19 more Entry Point Projects under the Economic Transformation Programme.

He said the projects would generate almost RM67 billion in investments, RM36 billion in gross national income and create 35,000 new jobs.

The Finance Index fell 31.41 points to 14,308.89, Plantation Index declined 13.14 points to 8,213.36 and the Industrial Index slipped 4.59 points to 2,911.73.

The FBM Emas Index rose 3.33 points to 10,765.06 and the FBM70 Index added 2.97 points to 11,509.84.

The FBM Ace Index, however, dropped 27.89 points to 4,454.37.

Advancers led decliners by 437 to 426 while 282 were unchanged, 244 untraded and 37 suspended.

Volume increased to 2.706 billion shares valued at RM2.637 billion from 2.226 billion shares valued at RM2.800 billion yesterday.

In Jakarta the JCI fell 23.42 points, or 0.7 percent, to close at 3,455.13. About 4.3 billion shares worth Rp 7.2 trillion ($792 million) changed hands. Decliners outnumbered gainers 147 to 63.

Bank Negara Indonesia, the third-largest state-owned bank, lost 5.2 percent to Rp 3,200. Banking stocks dropped after the International Monetary Fund said Indonesia’s central bank should raise interest rates to prevent accelerating inflation, and that the rupiah was not “overvalued” because of the nation’s growth.

Bank Pembangunan Daerah Jawa Barat and Banten dropped 4.8 percent to Rp 1,200.

The bank plans to sell Rp 2 trillion of bonds on Jan. 27 and 28 to fund credit expansion, it said in a prospectus published in Bisnis Indonesia.

The rupiah fell against the US dollar, trading at 9,061 on Tuesday from 9,046 a day before.

The rupiah has lost 1.2 percent this year after gaining 4.6 percent in 2010.


Shayne Heffernan brings more than 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over US$500m and 1 that reach a peak market cap of US$15billion. He has managed and overseen start-ups in Mining, Shipping, Technology and Financial Services.


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This year in Thailand-what next?

04 January 2011
By David Swartzentruber      

It is commonplace in journalism to write two types of articles at the transition point between the year that has passed and the New Year. As this writer qualifies as an “old hand” in observing Thailand with a track record dating back 14 years, it is time take a shot at what may unfold in Thailand in 2011.

The first issue that can’t be answered is the health of Thailand’s beloved King Bhumibol, who is now 83 years old. He is the world's longest reigning monarch, but elaborate birthday celebrations in December failed to mask concern over his health. More

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