Daily News - 24 July 2020

Industrial Insight > Daily News - 24 July 2020
24 July 2020
Compiled by AllianceDBS Research

MALAYSIAN NEWS

Prestariang seeks to raise RM35m through one-for-three rights issue

Two days after proposing a private placement of 15% of its shares to its founder Dr Abu Hasan Ismail, Prestariang Bhd announced another cash call. In a bourse filing, Prestariang said it is planning to raise a further RM35.4m via a renounceable rights issue of ordinary shares with free detachable warrants. The rights issue will involve up to 176.8m new shares at an issue price of 20 sen per rights share, on the basis of one rights share for every three Prestariang shares held. The rights issue will come with free detachable warrants, on the basis of one warrant for every one rights share subscribed. Together with the RM27.9m injection agreed to by Abu Hasan on Tuesday, Prestariang is aiming to raise a total of RM63.2m through the two corporate exercises. Abu Hasan will take up a total of 79.6m new shares or a 15% stake in the company at 35 sen per share with free detachable warrants on the basis of one warrant for every placement share. Of the total proceeds raised, Prestariang said RM28.3m will be used for working capital, RM17.5m for business expansion for new product offerings and RM16.5m for partial repayment of advances from directors as well as redemption of the redeemable secured loan stocks. “Barring any unforeseen circumstances and subject to all required approvals being obtained, the proposals are expected to be completed by the fourth quarter of 2020,” the group said. (The Edge Markets)

Opcom bags Telekom job to supply optical fiber cables

Opcom Holdings said a subsidiary has negotiated and accepted a RM21.4m contract from Telekom Malaysia Bhd to manufacture and supply optical fiber cables. The contract will commence on Aug 1, 2020 to May 20, 2022. (Starbiz)

Willowglen gets RM8.5m contract from TNB

Willowglen Msc has been awarded a contract worth RM8.5m from Tenaga Nasional Bhd for the supply, installation and testing of field terminal units for its distribution automation project. The contract commenced on July 22 and is expected to be completed by Jan 20, 2024, the technology solutions provider said in a filing. (The Edge Markets)

MTouche to raise up to RM18m via private placement for media platform development

MTouche Technology has proposed a private placement to raise up to RM18.1m for the development of a new over the top (OTT) media platform. Up to 777.6m shares or 30% of the group's issued share capital will be issued to independent third-party investors to be identified later, the group said in a stock exchange filing. The proceeds expected to be raised are based on an indicative issue price of six sen per placement share. The actual issue price will be determined later. On completion of the proposed placement, which is anticipated to be by the third quarter of 2020, the group said it intends to commence the development of the OTT media platform. The OTT media platform is estimated to take 15 months to be developed. (The Edge Markets)

GLOBAL NEWS

US: July jobs report could show no progress and even reversal as virus spreads

The Labor Department said July 23 that initial jobless claims came in at 1.416m for the week ending July 18, the 18th straight week in which initial claims totaled more than 1m. The weekly claims also rose for the first time after 15 weeks of declines, and it was coincidentally the same week used by the government to conduct the survey for the monthly employment report. The number of people continuing to collect state unemployment benefits fell by 1m to 16.2m for the week ending July 11. That data is delayed by one week. Another 13.2m were collecting benefits under the Pandemic Unemployment Assistance program, according to data available through the week of July 4. The monthly data showed job gains of 4.8m in June, following 2.7m payrolls added in May. Those reports came after combined job losses of 22m in March and April. (CNBC)

China June pork imports jump 128.4% y-o-y

China imported 400,000 tonnes of pork in June, customs data showed on July 23, up 128.4% y-o-y, as a months-long buying spree continued as importers try to help plug a domestic shortage. China’s pork output declined by about a fifth in the first half of 2020 after an epidemic of African swine fever killed millions of pigs in the country last year. The imports mark the fourth straight month of pork shipments of around 400,000 tonnes, double the volume of earlier records. January to June pork imports were up 142.7% at 2.12m tonnes. Imports of pork including offal in June came to 540,000 tonnes, up 102.5% y-o-y, bringing total imports for this year to end-June to 2.82m tonnes, the data also showed. Customs had earlier this month highlighted the huge meat imports in June. Intake is expected to fall in coming months, however, after China started testing containers of frozen food for the presence of the coronavirus, slowing the trade. (Reuters)

Singapore inflation stays negative in June but drop in overall consumer prices slows

Higher food prices helped keep core inflation unchanged last month with supply chain disruptions likely to keep exerting upward pressure on imported foodstuffs. Core inflation, which excludes accommodation and private road transport costs, came in at minus 0.2% in June, unchanged from May. It was the fifth straight month of core consumer prices being lower than a year ago. This occurred as a steeper drop in the cost of services was offset by higher food inflation, as well as smaller declines in the costs of retail and other goods and electricity and gas. But overall inflation eased to negative 0.5% in June, from minus 0.8% in May, according to data released by the Monetary Authority of Singapore (MAS) and the Ministry of Trade and Industry (MITI) on July 23. This mainly reflected a smaller decline in private transport costs, MAS and MTI noted. Private transport costs fell at a slower pace of 4.4% in June compared with the 6.8% drop in May, due to smaller declines in car and petrol prices. (The Straits Times)

South Korea enters recession as exports plunge by most since 1963

South Korea plunged into recession in the second quarter in its worst economic decline in more than two decades as the coronavirus pandemic battered exports and social distancing curbs paralysed factories. Asia’s fourth-largest economy shrank by a seasonally adjusted 3.3% in the June quarter from three months earlier, the Bank of Korea said on July 23. That is the sharpest contraction since the first quarter of 1998 and steeper than a 2.3% fall seen in a Reuters poll. South Korea joins Japan, Thailand and Singapore in technical recession, defined as two straight quarters of decline, as the pandemic slams Asia’s trade-reliant economies. South Korea’s GDP fell 2.9% in y-o-y terms; the biggest fall since the fourth quarter of 1998 and worse than a 2.0% decline seen in the poll. Exports, which account for nearly 40% of the economy, were the biggest drag on growth, dropping by 16.6% q-o-q to mark the worst reading since 1963. (The Straits Times)