JHO LOW’S WILD NIGHTS ON DISPLAY WITH

US$250,000 FOR DICAPRIO, FOX p4

T H U R S DAY, F E B RUA R Y 1 7 , 2 0 2 2 w w w. t h e e d g e m a r k e t s. c o m
ISSUE 332/2022

CEOMorningBrief HOME: Mr DIY’s quarterly profit jumps 24% to record high p5

EY Consulting: Serba Dinamik knew FFU would be done by qualified auditor p6
Epic demise of Genting HK’s Crystal Cruises leaves customers out US$100 mil — or more p7
Heineken Malaysia to study if price adjustments needed amid rising input costs p11
Dual wholesale network model in 5G implementation will create confusion, says expert p12

Malaysia’s daily
Covid-19 tally jumps to
new record high of 27,831
amid Omicron wave
Report on Page 2.
 T H U R S D AY F E B R U A RY 1 7 , 2 0 2 2 2 THEEDGE CEO MORNING BRIEF

the edge ceo morning brief published by publisher + . Ho Kay Tat

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H O M E

KUALA LUMPUR (Feb 16): Malaysia re-
ported 27,831 Covid-19 cases on Wednes-
day (Feb 16), a new record high of daily
cases since the first coronavirus case was
reported in the country in January 2020,
as the Omicron wave sweeps across the
country.
This broke the previous highest daily
tally of 24,599 cases, which was reported
on Aug 26, 2021.
Of the new infections, 27,734 patients
showed none to little symptoms and were
categorised under Categories 1 and 2 while
the remaining 97 patients were more se-
rious cases and were placed under Cate-
gories 3, 4 and 5.
“We need to brace for this Omicron
storm together. Many countries in our re-
gion are seeing an upward trend. Please
comply with all public health and social
measures (SOP) to brace for the Omicron
storm.
“Please get vaccinated and get your
booster dose to protect yourself and your
loved ones,” Health director-general Tan
Sri Dr Noor Hisham Abdullah tweeted
on Wednesday.
With the latest figures, Malaysia’s cu-
mulative confirmed Covid-19 infections
now total 3,111,514. However, 7,912 peo-
ple have recovered from the disease, raising
total recoveries so far to 2,876,450.
Active cases climb to 182,965; average
occupancy rate for hospital beds now
at 64.2%
The country’s active cases climbed further
to 182,965 on Tuesday (Feb 15), including
170,635 who were undergoing home quar-
antine, according to the Health Ministry’s
COVIDNOW portal.
This was the highest number since Sep-
tember 26 last year, when 183,287 active
cases were reported, and an increase of
8.62% from the 168,447 cases reported
on Monday.
Daily Covid-19 deaths increased slightly
to 31 on Tuesday — eight in Sabah, seven
in Selangor, six in Johor, five in Penang,
two in Kedah, and one each in Negeri
Sembilan, Perak and Terengganu — ver-
Malaysia’s daily
Covid-19 tally
jumps to new record
high of 27,831 amid
Omicron wave
BY SYAFIQAH SALIM
theedgemarkets.com
Covid-19 cases and vaccination
progress in Malaysia
On Feb 15, 2022
Daily Covid-19 deaths 31
Active cases 182,965
Daily vaccine doses administered 154,776
Daily booster administered 110,745
% of adult population received 97.5
two-dose vaccination
% of adult population received 57.3
booster shots
On Feb 16, 2022
Number of new cases 27,831
Local cases 27,713
Imported cases 118
Category 1 and 2 patients 27,734
(no symptoms, mild symptoms) (99.65%)
Category 3, 4 and 5 patients 97
(with pnemonia, pneumonia requiring (0.35%)
oxygen therapy, critical and requiring
assisted ventilation)
Number of new recoveries 7,912
Source: Ministry of Health
sus 24 deaths a day earlier. The Covid-19
death toll stood at 32,180 including 6,514
brought-in-dead cases.
However, the number of daily Covid-19
deaths on Tuesday decreased by 92.11%
from the 393 deaths reported on Aug 26
last year.
The average occupancy rate of hospital
beds in the country was 64.2% on Tuesday.
Among States and Federal Territories, Mel-
aka led with the highest occupancy rate at
86.9%, followed by Johor (83.9%), Kedah
(77.7%), Terengganu (77.5%), Kelantan
(75.2%) and Selangor (74.1%).
Kuala Lumpur had the lowest occu-
pancy rate of 26.4%.
The seven-day moving average of daily
admissions to public hospitals fell to 2,034
compared with 2,706 on Aug 26 last year.
7% of children had received at least
one dose of Covid-19 vaccine
A total of 246,869 children aged between
five and 11, or 7% of the group in Malay-
sia, had received at least the first dose of the
Covid-19 vaccine as of Tuesday (Feb 15),
under the National Covid-19 Immunisa-
tion Programme for Children (PICKids),
according to COVIDNOW.
Launched on Feb 3, PICKids aims to
ensure that 3.6 million of all children in
the country from the age of five receive at
least their first dose by the end of February
to ensure the risk of infection in schools
can be reduced, thus preventing clusters
among school children.
Malaysia is administering the paediat-
ric dose of the Pfizer-BioNTech Covid-19
vaccine to children as a two-dose regime
with an eight-week interval.
Meanwhile, 13,486,823 people, or
57.3% of the country’s adult population,
have received their booster dose, and
22,939,377 people, or 97.5% of adults,
have completed their two-dose vaccination.
The percentage of the adult popula-
tion in the country who had received two-
dose vaccinations increased to 97.5% from
60.2%, while those with at least one dose
of Covid-19 vaccine grew to 98.7% from
80.9%.
T H U R S D AY F E B R U A RY 1 7 , 2 0 2 2 3 THEEDGE CEO MORNING BRIEF
 T H U R S D AY F E B R U A RY 1 7 , 2 0 2 2 4 THEEDGE CEO MORNING BRIEF

H O M E

Jho Low’s wild nights on display with

US$250,000 for DiCaprio, Fox
BY PATRICIA HURTADO PHOTOS BY BLOOMBERG
Bloomberg

(Feb 16): A quarter of a million dollars

for Leonardo DiCaprio. A US$385,773
(about RM1.616 million) bar tab. Five
grand for “model wrangling”.
These were among the expenses that
jurors in the federal conspiracy trial of for-
mer Goldman Sachs Group Inc banker
Roger Ng heard about Tuesday, as a gov-
ernment witness described how millions of
dollars siphoned off in the 1MDB scandal
were frittered away on lavish parties host- Jho Low
ed by a high-flying Malaysian financier.
Ng is accused of conspiring with for-
mer star Goldman banker Tim Leissner to
help the now-fugitive financier, Jho Low,
steal the funds in exchange for kickbacks.
The jury in Brooklyn, NewYork, learned
of invoices from a Las Vegas party for Low
in which food, beverages, “talent” and “top
quality models,” among other items, add-
ed up to more than US$3.6 million. That
big bar tab included 65 bottles of Cristal
Champagne for about US$100,000 and
a US$38,955 tip.
Ng, the only former Goldman Sachs em-
ployee to stand trial in the US for the scan-
dal, is charged with conspiring to violate US
anti-money-laundering law to steal billions
of dollars from the Malaysian fund 1MDB.
The expenses are what Low did with some
of the US$700 million he made off with in
the global fraud, according to prosecutors.
As the government described the fruits Leonardo DiCaprio Paris Hilton
of a scam stretching from Malaysia to Wall
Street, the jury got a look at some celeb-
rity fees:
• DiCaprio: US$250,000
• Paris Hilton: US$100,000
• Megan Fox: US$250,000
• Kim Kardashian: US$50,000

Basically, the panel was told, Low par-

tied like there was no tomorrow.
The sums flew by as Alex Cohen, the
chief financial officer of Strategic Group,
an entertainment and marketing company
that arranged parties for Low, testified. Co-
hen described a series of shindigs that fea-
tured guests and entertainers such as Sean
“Diddy” Combs, Jamie Foxx and Fergie.
He said Low provided the entertain-
ment company with at least 25% of its
profit in 2012 and that for one event it was
paid US$5,000 for the said model wran-
gling alone — all allegedly fuelled by mon-
ey Low took from 1MDB.
Megan Fox
A July 2012 event Strategic handled for
Low aboard a yacht on the French Riviera
dictated that models be flown in. During
cross-examination by defence lawyer Zach
Intrater, Cohen was asked why he’d written
“Strategic Escorts LLC” when referring to
the company’s efforts to hire the models.
“I was poking fun that there were wom-
en coming on this boat trip and we were
Roger Ng
procuring these women,” he said.
The case is US v Low Taek Jho, 18-cr-
538, US District Court, Eastern District
of New York (Brooklyn).
Read also: Umno’s appeal on dismissal to
strike out SRC International’s RM16m
suit set for March 2 Click here
 T H U R S D AY F E B R U A RY 1 7 , 2 0 2 2 5 THEEDGE CEO MORNING BRIEF

H O M E

Mr DIY’s
KUALA LUMPUR (Feb 16): Mr DIY
Mr DIY Group (M) Bhd’s
Group (M) Bhd’s net profit for the fourth
quarterly earnings
quarterly profit
quarter ended Dec 31, 2021 (4QFY21)
grew by 24.28% to a record high of (RM mil) Net profit Revenue

jumps 24% to
RM134.55 million from RM108.26 mil- 150 975.39 1000
lion in the same period of the previous year,

record high
on the back of a RM10.7 million gain in 120
870.18
operating income during the quarter.
Earnings per share rose to 2.14 sen from 90
800
1.74 sen. 740.23
60
In a bourse filing on Wednesday (Feb BY SULHI KHALID 768.33 759.82 768.02
16), the home improvement retailer said theedgemarkets.com 30

113.45

108.27

124.79

134.55
82.13

its quarterly revenue surged by 26.95% to
RM975.39 million — also its highest ever —
from RM768.33 million previously, largely
owed to an increase in total number of stores
as well as the lifting of lockdowns and oth-
er restrictions imposed in the prior period.
The group declared a single-tier divi-
dend of 0.9 sen per share to be paid on
April 1, taking total dividend declared for
the financial year to 2.95 sen.
For full FY21, net profit increased by
28.08% to RM431.83 million against
RM337.16 million in FY20.
Annual revenue rose by 31.8% to
RM3.37 billion from RM2.56 billion in
FY20, underpinned by an increase in num-
ber of stores, positive contributions from new
stores, and a higher average basket size.
On a quarterly basis, net profit rose by
48.92% from RM90.35 million in the immedi-
ate preceding quarter (3QFY21) while revenue
ticked higher by 27% from RM768.02 million.
Commenting on the group’s financial
performance, Mr DIY chief executive of-
ficer Adrian Ong said the group is pleased
to have delivered a strong set of financial
results, which reflect the strength and re-
silience of its business.
“The group remains committed to de-
livering long-term sustainable growth driv-
en by the inherent strength of the business,
an effective strategy of managing new store
90.35
0 600
3Q 4Q 1Q 2Q 3Q 4Q
FY20 FY21
Source: Bloomberg
growth, improving operating efficiencies
and most importantly, staying relevant to
our customers.
“The group’s target for 2022 is to open
180 stores across the four brands, bringing
the total number of stores to approximately
1,100,” he shared.
Shares in Mr DIY closed four sen or
1.07% higher at RM3.79, giving the com-
pany a market capitalisation of RM23.81
billion.
Listed in October 2020, the group’s
share price has more than doubled from
its initial public offering price of RM1.60.

Press Metal
KUALA LUMPUR (Feb 16): Press Met- Press Metal Aluminium
al Aluminium Holdings Bhd’s share price Holdings Bhd
shares rise to
rose to a new high on Wednesday (Feb 16)
amid escalating fears that reduced sup- Vol (mil) RM

new high amid

plies from Russia would exacerbate existing 40 8
shortages of the industrial metal.
RM7.00

Russian supply
The aluminium smelter ended the day 7
at RM7 for a gain of 16 sen or 2.34% from 30

Tuesday.
This gives the group a market capi-
talisation of RM56.53 billion based on
8.08 billion outstanding shares while
trading at 71.84 times earnings, based
on Bloomberg data.
Aluminium prices have climbed to-
wards multi-year highs. On Monday,
Reuters reported that a Russian invasion
of Ukraine could mean sanctions against
Russian companies such as Rusal, which
accounts for about 5% of the global alu-
minium supply.
Despite Russia’s repeated denials that
it is preparing to invade Ukraine, the in-
dustrial metal’s price on the London Met-
al Exchange (LME) hit US$3,333 per
tonne last week, close to the record high
of US$3,380.15 last seen in July 2008,
the report said.
The metal’s prices retreated from its
near-record high to US$3,285 on Wednes-
concerns
BY SEAH EU HEN
theedgemarkets.com
day after Russian Foreign Minister Sergei
Lavrov urged President Vladimir Putin to
take a diplomatic approach to resolve the
Ukraine crisis.
Meanwhile, aluminium stocks at
868.950 tonnes have more than halved
since March 2021 as cancelled warrants
6
20
5
10
4
RM4.33
0 3
Jan 21, 2021 Feb 16, 2022
Source: Bloomberg
— metal earmarked for delivery — at 30%
suggests that more aluminium will be de-
livered over the near future, according to
Reuters.
Year to date, Press Metal shares have
appreciated by 23.67% or RM1.34 in ab-
solute ringgit value. Last April, the group
had undertaken a bonus issue of 4.04 bil-
lion shares on the basis of one free share
for every existing share held.
 T H U R S D AY F E B R U A RY 1 7 , 2 0 2 2
EY Consulting: Serba Dinamik knew FFU
would be done by qualified auditor
KUALA LUMPUR (Feb 16): Ernst &
Young Consulting Sdn Bhd (EY Consult-
ing) said Serba Dinamik Holdings Bhd
had known from the day that it was ap-
pointed that Muhammad Syahrizal Abd
Rahim, who is a partner in E&Y PLT and
a registered auditor, would be conducting
the special independent review (SIR) that
was required.
At the High Court on Wednesday (Feb
16), EY Consulting’s counsel Gopal Sree-
nevasan argued before Justice Datuk Ah-
mad Fairuz Zainol Abidin in online pro-
ceedings that the term special auditor
within Paragraph 2.24 of the Main Mar-
ket Listing Requirements (MMLR) does
not necessarily mean an auditor per se as
the scope is wider, because it has nothing
to do with audit or financial numbers or
accounts or financial statements.
“It has to do with ascertaining whether
the findings made by the statutory auditor
of Serba Dinamik, namely KPMG, [were]
correct.We say that the words should mean
something other than the statutory auditor
should be given emphasis.
“Furthermore, as shown, Syahrizal who
is appointed — and this was informed to
Serba Dinamik — is a partner in E&Y
PLT and recognised as a qualified auditor
as shown. Prior to the release of the FFU
[fact-finding update] there had not been
any problems regarding EY Consulting’s
status,” he added.
Gopal was rebutting claims by Serba
Dinamik’s counsel Mak Lin Kum that EY
as a consulting firm had not been recog-
nised by the Finance Minister as an audi-
tor, and that it had misrepresented itself
as an auditor within the meaning of Par-
agraph 2.24 of the MMLR.
Mak had earlier referred to a letter from
EY Consulting dated July 2, 2021 which
referred to Paragraphs 2.23 and 2.24 of
the MMLR to conduct the SIR of the stat-
utory audit by KPMG, Serba Dinamik’s
former external auditor.
“The firm Ernst & Young PLT is a rec-
ognised auditor while EY Consulting is
not and it is not registered with the Au-
dit Oversight Board. Hence, my client is
taking issue on that and hence questioned
whether EY Consulting should be allowed
to reveal the FFU and other findings in
the first place.
“Hence, Serba Dinamik contends that
the appointment of EY Consulting should
be declared null and void and ab initio,”
he said.
6 THEEDGE CEO MORNING BRIEF
H O M E
BY HAFIZ YATIM
theedgemarkets.com
Serba Dinamik argues EY Consulting's
appointment should be nullified as latter
not an auditor.
Paragraph 2.24 states that “where the
exchange is of the opinion that a breach
of these requirements may have occurred
and the appointment of a special auditor
is necessary, the exchange may instruct
the listed issuer, any of its subsidiaries or
both, as the exchange may direct. Any cost
incurred as a result of the appointment of
the special auditor must be borne by the
listed issuer”.
A special auditor means any auditor
other than the statutory auditor of the list-
ed issuer appointed pursuant to the Com-
panies Act or in relation to a foreign cor-
poration, pursuant to the relevant laws of
the place of incorporation, according to
Paragraph 2.24.
Gopal further said EY Consulting had
complied with the requirements to be an
auditor when Syahrizal was engaged, where
it ensured the existing auditor is not a spe-
cial reviewer from KPMG.
He also claimed that this litigation was
made by Serba Dinamik due to the com-
pany not liking the contents of EY Con-
sulting’s FFU.
“It is not an action to genuinely ventilate
on a complaint with regards to my client.
We say Syahrizal fulfils the criteria and this
was presented to Serba Dinamik’s board
before my client was hired,” he added.
Furthermore, Gopal argued that at
another High Court in Bursa Malaysia’s
action against Serba Dinamik last Feb 7,
Judicial Commissioner (JC) Wan Muham-
mad Amin Wan Yahya in his decision had
recognised EY Consulting as an auditor
and ordered the FFU findings to be re-
leased.
“We say that this court should not al-
low this matter or issue to be relitigated,
as a decision has been made in the other
court,” he said.
In his reply, Mak said this court should
not be bound by the decision made by the
JC as that matter was between Bursa Ma-
laysia and his client and does not involve
EY Consulting.
He further said in the absence of a writ-
ten judgment by the JC, such a notion
should be considered as obiter dictum (not
legally binding as it is merely the judge’s
expression) in court.
The Serba Dinamik lawyer further
alleged that his client was not aware of
the purported internal communications
between EY Consulting over Syahrizal’s
appointment and that he was a qualified
auditor.
Serba Dinamik had on Nov 5 filed a
lawsuit against EY Consulting seeking to
restrain the latter from sharing any findings
or opinions on the company with Bursa
Malaysia or other parties following ques-
tions surrounding the firm not being a
qualified auditor per se.
Decision on March 8
Justice Ahmad Fairuz fixed March 8 to de-
liver his decision on whether the contract
between Serba Dinamik and EY Consult-
ing should be declared null and void and
hence, whether an injunction should be im-
posed on the firm from releasing the find-
ings. He will deliver his decision via email.
Also present in this proceedings was
counsel Christopher Leong, who held a
watching brief for the Securities Commis-
sion Malaysia.
Prior to this, Justice Ahmad Fairuz had
on Feb 10 decided against Serba Dina-
mik’s application to impose an injunction
on Bursa Malaysia to prevent the company
from being compelled by the regulator to
release the FFU.
It was also reported that Wan Muham-
mad Amin, in the legal action filed by Bur-
sa Malaysia against the company, had on
Feb 7 ordered Serba Dinamik to reveal
the FFU and other findings periodically.
His court had on Monday (Feb 14)
also dismissed the company’s application
for a stay.
 T H U R S D AY F E B R U A RY 1 7 , 2 0 2 2
Epic demise of Genting HK’s Crystal Cruises
leaves customers out US$100 mil — or more
BY FRAN GOLDEN
Bloomberg
NEW YORK (Feb 16): Last week, the
most-awarded luxury cruise line in the in-
dustry, Crystal Cruises, unceremoniously
shuttered its doors, with not a word to con-
sumers nor travel agents. Abandoned by its
parent company Genting Hong Kong Ltd,
it leaves a trail of debt — to travellers, who’d
put down payments and deposits for sailings
into 2024; to agents owed commissions; to
employees in offices; to crew still on ships;
and to unpaid vendors.
Although US$4.6 million (RM19.26 mil-
lion) in outstanding fuel bills were central
to Crystal’s demise, the signs of trouble ap-
peared weeks earlier in a string of dominoes
triggered by the insolvency of a German ship-
yard.Through it all — a petition to wind up
the company, layoffs, a halt to future sailings
— Hong Kong was still assuring Crystal em-
ployees that the brand was not in jeopardy.
In fact, passengers were still on ships.
By early February, when the line’s new
200-passenger expedition ship, the Crystal
Endeavor, disembarked its final passengers
in Ushuaia, Argentina, the cash had run dry.
“Genting HK effectively washed their
hands of Crystal when they filed liquida-
tion in Bermuda,” said Jack Anderson, who
served as president of Crystal Cruises un-
til the company dissolved its operations
on Feb 11. “At that point our relationship
with Genting was effectively severed, and
we were cut loose to fend for ourselves,” he
told Bloomberg.
Industry consultant David Giersdorf,
whose Global Voyages Group is based in
Seattle, said the demise of Crystal comes at
a time when most cruise companies seem
to be turning the corner from the Covid-19
pandemic. “This is — wow — very strange
timing,” he said. “It’s weird that a shipyard
issue in Germany triggered the demise of a
multibillion-dollar entity.”
A titanic collapse
Crystal Cruises was a product of the high-
faluting late 1980s, a prestige line started by
a former Princess Cruises executive with fi-
nancial support from Japan’s NYK.The line
launched its first new ship, Crystal Symphony,
in 1995, and followed up with Crystal Seren-
ity in 2003. Both were over-the-top floating
palaces, with no expense spared.
Guests drank copious amounts of com-
plimentary Champagne and feasted on sushi
and miso-marinated black cod in Master
7 THEEDGE CEO MORNING BRIEF
H O M E
Chef Nobu Matsuhisa’s onboard restaurants.
Butlers brandishing silver trays serviced pent-
houses and suites. For those luxuries, Crys-
tal’s fares could easily exceed US$1,200 per
person, per day.
While there were rumours the line had
not registered a positive Ebitda since 2017,
the cruise line was a crown jewel for Gen-
ting Hong Kong and its billionaire casino
magnate owner, Tan Sri Lim Kok Thay. It
came with a loyal following of big-spend-
ing travellers, the majority from the US, and
Crystal Cruises was forecasting a profit for
2020 — before Covid hit.
On its website, Crystal Cruises still
boasts of its many Conde Nast Traveler’s
Readers’ Choice Awards and No. 1 spots
on Travel + Leisure’s World’s Best Awards
— recognition it earned annually for near-
ly 30 years.
After Genting Hong Kong purchased the
line in 2015 for US$550 million, it launched
an ambitious expansion plan that added two
planes, a Boeing 787-8 and Boeing 777-200,
for private air flights; a yacht for exploring the
Seychelles; five luxury river ships (of which
four were newly built); and an expedition
ship capable of reaching such remote and
impenetrable places as Antarctica.
Along the way, potential buyers courted
the brand, making offers as recently as fourth
quarter 2021. One of the bidders was Ital-
ian billionaire Manfredi Lefebvre d’Ovidio,
flush with the proceeds from the sale of his
ultraluxury Silversea Cruises Ltd to Royal
Caribbean Group.
“Crystal could have been a subsidiary
or shopped by privately held companies,”
Giersdorf said. “You have to ask why the
larger Genting Group let this occur — may-
be to reorganise assets? It’s just odd the way
it happened and how quickly it happened.”
BLOOMBERG
A bank account of zero
Consumers and travel agents are caught in
the crosshairs.
Crystal is currently responsible for more
than US$100 million in customer deposits
and payments, all held in reserve accounts
under the control of various credit card com-
panies.
Most future itineraries were paid by credit
card, which will make for easier refunds, said
Anderson. Customers who paid in cash may
not be as lucky, and those who had paid fully
for sailings that were cancelled in 2020 or
2021 but rolled those funds into new book-
ings are completely out of luck; any credits
are now worthless.
Beyond that, travel agents are owed 10%
to 16% commissions on each itinerary they
sold.The time spent untangling the logistical
messes on behalf of their clients constitutes
an additional cost they can never recoup.
For now, at least, the cruise line’s web-
site is still up and will be used to post infor-
mation from a court-appointed assignee on
how consumers can start that refund process.
It’s unclear, however, what assets Crys-
tal has left, beyond computers and office
furniture, some bonds, those reserve ac-
counts, and whatever marketing value lies
in its customer, travel agent, employee, and
crew databases. The company’s fleet, as it
turns out, was not owned by the cruise line
but amounts to secured assets of preferred
creditors.
On Feb 11, the last day the office was
operational, Anderson said, none of it was
in liquid cash that Crystal could use to keep
operating. “Ultimately, we ended up with a
bank account of zero.”
Click here to read the full story
 T H U R S D AY F E B R U A RY 1 7 , 2 0 2 2
KUALA LUMPUR (Feb 16): AirA-
sia X Bhd’s (AAX) net loss narrowed to
RM11.94 million for its second quarter
ended Dec 31, 2021, from RM149.14 mil-
lion in the immediate preceding quarter,
due to lower operating costs.
Loss per share narrowed to 0.3 sen from
3.6 sen, the medium-haul low-cost carri-
er’s bourse filing showed.
Quarterly revenue rose 20.19% to
RM119.31 million from RM99.27 mil-
lion in the preceding quarter.
There is no comparative financial infor-
mation available for the same quarter last
year, as the group changed its financial year
end from Dec 31, 2020 to June 30, 2021.
For the six months ended Dec 31, 2021,
AAX said its cumulative net losses and
revenue stood at RM161.08 million and
RM218.58 million respectively.
The group said it has a new focus on
growing its cargo business while combining
it with the carriage of passengers to ensure
that all routes operated are profitable on
an ongoing basis.
“A total of three aircraft were operating
KUALA LUMPUR (Feb 16): Capital A
Bhd (formerly known as AirAsia Group
Bhd) announced that its unit AirAsia
Aviation Group Ltd has entered into a
non-binding memorandum of understand-
ing (MoU) with international aircraft leas-
ing company Avolon Aerospace Leasing.
This is to establish a joint working group
to study the feasibility of urban air mobility
in the ASEAN region and evaluate the pos-
sibility of leasing up to 100 VX4 electric ver-
tical take-off and landing (eVTOL) aircraft.
In a bourse filing, Capital A said these
eVTOL aircraft, commonly known as
drones, will allow Capital A’s unit to fur-
ther revolutionise air travel by providing
advanced air mobility to a whole new
group of passengers.
It said recent developments in eVTOL
technology are creating an exciting new
aviation market that could revolutionise
urban air mobility.
“The forecast cost per seat of eVTOL
[vehicle] is such that it is likely not only
to displace the helicopter market, but also
democratise urban air mobility, creating
what could be a US$1.5 to US$2.9 trillion
global market by 2040,” it said.
Capital A believes environmental con-
cerns pose an existential threat to aviation,
and eVTOLs are an important opportunity for
the parties to be early influencers and adopters
in the decarbonisation of air transportation.
“Given the combination of population
density, demographics, tourist resort land-
scape, road congestion as well as limited
ferry and runway capacity, ASEAN will
become a key eVTOL market.
8 THEEDGE CEO MORNING BRIEF
H O M E
AirAsia X’s 2Q
net loss narrows
to RM11.9 mil;
group to grow its
cargo business
BY SEAH EU HEN
theedgemarkets.com
during the quarter to December 2021 and,
as more aircraft are progressively brought
back into service, cargo and charter rev-
enues are expected to continue growing,
and will be supplemented by revenue from
passenger sales when markets reopen,” said
AAX.
The airline said that upon the comple-
tion of its scheme of arrangement, it will
carry out its planned fundraising to raise
sufficient new capital.
Capital A unit inks
MoU with Avolon
to create ride-
sharing platform
BY SYAFIQAH SALIM
theedgemarkets.com
REUTERS
Tan Sri Tony Fernandes
“Avolon has invested in Vertical Aero-
space Ltd, through a PIPE (private invest-
ment in public equity) funding as part of
a de-SPAC (special-purpose acquisition
company) that concluded in a listing on
the NYSE (New York Stock Exchange) in
December 2021. Avolon has also placed an
order for up to 500 VX4 aircraft and is the
only lessor to have made a commitment
in the eVTOL space,” it added.
In a separate statement, Capital A chief
executive officer Tan Sri Tony Fernandes
It added that its growing cargo and
charter operations will ensure that it has
sufficient liquidity to meet its financial ob-
ligations.
AAX, which completed its 10-for-one
share consolidation on Monday (Feb 14),
saw the share price rise two sen or 3.88%
to 54 sen on Wednesday.
This gives the group a market capitalisa-
tion of RM221.93 million based on 414.81
million outstanding shares.
said innovation has always been in the
group’s DNA and that using technology
to find more efficient and sustainable ways
of doing things is a core focus of the group.
“I am truly excited about this partner-
ship between Avolon and AirAsia and the
potential for zero-emissions ultra-short-haul
air travel in Southeast Asia.The digital era is
now. In the VX4, we have identified what we
believe will be the eVTOL aircraft of choice
and we are thrilled to be the launch airline
for the aircraft in Southeast Asia.We are also
delighted to extend our long-standing rela-
tionship with Avolon, which has a proven
track record of delivering for its customers
and is in sync with our goal to become the
leading one stop travel and delivery platform
in ASEAN,” he said.
Capital A was classified as a PN17 com-
pany after Bursa Malaysia rejected its re-
quest to extend the 18-month exemption
period which ended on Jan 7.
For the cumulative nine months end-
ed Sept 30, 2021, Capital A narrowed its
net loss to RM2.23 billion from RM2.66
billion in the same period of financial year
2020, although its revenue fell to RM1.02
billion from RM2.97 billion.
Capital A shares settled one sen or 1.59%
lower at 62 sen, with a market capitalisation
of RM2.58 billion. It saw some 16.98 million
shares change hands.The stock has declined
23.46% year-to-date from 81 sen.
Read also: AirAsia, Singapore Tourism
Board ink MOU to promote travels to
city state Click here
T H U R S D AY F E B R U A RY 1 7 , 2 0 2 2 9 THEEDGE CEO MORNING BRIEF
 T H U R S D AY F E B R U A RY 1 7 , 2 0 2 2
KUALA LUMPUR (Feb 16): Sime Darby
Bhd said the group is still looking for merger
and acquisition (M&A) opportunities to grow
its businesses, especially with the economic
recovery from the Covid-19 pandemic.
“We continue to look at opportunities in
M&A to continue to grow our businesses
in the two core businesses that we have:
industrial and motors businesses,” said the
group’s chief executive officer Datuk Jeffri
Salim Davidson.
Jeffri, who was speaking at a virtual press
conference on Wednesday (Feb 16), did not
provide any further details on the matter.
In a corporate presentation last Octo-
ber, Sime Darby said its expansion for the
financial year ending June 30, 2022 (FY22)
would include “transformational” M&As.
The growth strategy includes luxury car
dealerships in China and expansion of the
company’s mining services in Australia.
Besides China and Australia, which ac-
count for 40% and 30% respectively of the
group’s revenue, the group said it was also
seeking to enter into other markets like
India and Indonesia.
Sime Darby’s latest acquisition was
done in July 2021, when it bought Salmon
Earthmoving Holdings Pty Ltd, an Austral-
ian rental and maintenance services com-
pany that services the civil construction,
agricultural and mining sectors.
IPO of Sime Darby’s healthcare unit on hold
KUALA LUMPUR (Feb 16): Sime
Darby Bhd has put plans to spin-off
its healthcare unit on the backburn-
er, group chief executive officer Datuk
Jeffri Salim Davidson said during a vir-
tual briefing on Wednesday (Feb 16),
but did not elaborate on the reason for
the delay.
“We are looking at various opportu-
nities to grow the healthcare business,
but the IPO (initial public offering) [for
10 THEEDGE CEO MORNING BRIEF
H O M E
Sime Darby
continues to eye
M&As to grow
business
BY JUSTIN LIM
theedgemarkets.com
FY22 next profit expected to be at
FY21 level
At the press conference, Jeffri said Sime
Darby expects its net profit for FY22 to
be at at around the FY21 level after strip-
ping out the RM272 million one-off gain
realised from the divestment of the group’s
stake in Tesco Malaysia.
“We had a very good year last year and
we are going to be close to achieving last
year’s results, which I think is still pretty
good considering Covid-19 and the head-
winds that we are [facing],” he said.
“I think we should be able to see the de-
mand for luxury cars remaining quite strong.
The other thing is the commodity prices,
particularly met coal, are pretty strong. So
that’s going to drive demand for our prod-
BY JUSTIN LIM
theedgemarkets.com
the healthcare unit] is on hold at the mo-
ment,” Jeffri said at the group’s second
quarter financial performance ended Dec
31, 2021 (2QFY22) briefing.
In October 2020, Sime Darby said it
was mulling the listing of its 50:50 joint
venture healthcare unit, Ramsay Sime Dar-
by Health Care Sdn Bhd (RSDHC) in
ucts over the next six months,” he added.
Despite supply chain disruption con-
cerns due to the pandemic and chip short-
ages, Jeffri said the group should be able
to secure enough volume of cars from its
principals to sell.
Sime Darby’s core net profit for the first
half of FY22 was down 8.2% to RM581
million due to lower contribution from
the industrial division, which was affect-
ed by overall industry volume contraction
in China and weaker operating margin
in Australasia. Six-month revenue was
down 4.12% to RM21.2 billion from
RM22.12 billion a year ago, the group’s
filing showed.
Taking into account the one-off gain
from the Tesco Malaysia deal last year,
Sime Darby’s net profit shrank 36.43%
to RM581 million from RM914 million
a year ago.
For the second quarter ended Dec 31,
2021 (2QFY22), the core net profit was
4.4% lower at RM345 million, compared
with RM361 million in the same quarter
of the previous year, due largely to lower
profits from the industrial division’s Chi-
na and Australasia operations. Revenue
for the quarter fell 6.29% to RM10.54
billion from RM11.24 billion.
On a quarter-on-quarter basis, Sime
Darby’s net profit was, however, up
46.19% from RM236 million in 1QFY22
due to stronger results from the industrial
and motor divisions, despite a 1.28% dip
in revenue from RM10.67 billion.
The group declared a first interim div-
idend of four sen, compared with the six
sen paid out in the previous year. The ex-
date for the dividend is April 25 while the
payment date is May 11.
Shares in Sime Darby closed down two
sen or 0.88% to RM2.26, for a market
capitalisation of RM15.39 billion.
Read also: Sime Darby’s 2Q net profit
falls 45.5% in absence of one-off gain
Click here
2021. Set up in 2013, Sime Darby jointly
owns the healthcare unit with Australia’s
largest hospital operator Ramsay Health
Care Ltd.
It was reported that RSDHC could
raise up to US$300 million (RM1.2 bil-
lion) in its flotation exercise.
In August last year, Jeffri said the
planned IPO for the healthcare unit was
still on the cards, but did not divulge the
timeline of the listing.
 T H U R S D AY F E B R U A RY 1 7 , 2 0 2 2
Heineken
Malaysia to
study if price
adjustments
needed amid
rising input costs
BY IZZUL IKRAM
theedgemarkets.com
KUALA LUMPUR (Feb 16): Heineken
Malaysia Bhd is set to study whether its
products require price adjustments to ad-
dress increased input costs, said its man-
aging director Roland Bala.
He said the group continues to experi-
ence rising input costs as well as logistics
constraints as a result of the pandemic dis-
rupting supply chains.
“But having said that, as a global player,
we have to make sure we proactively man-
age the constraints that we have. We focus
on what we can influence in this situation,”
Roland said during a media briefing on the
group’s financial performance for the fourth
quarter ended Dec 31, 2021 (4QFY21).
Heineken Malaysia finance director
Karsten Folkerts said the group is moni-
toring the input cost development closely
this year, noting that the costs of raw ma-
terials and packaging materials are “really
spiking”.
“We are trying to mitigate that by work-
ing closely with our global Heineken part-
ner to ensure continuity of supply, but also
to get the best prices,” he said.
Folkerts said that Heineken Malaysia is
set to review its products’ prices to see if
price adjustments are needed to maintain
the margins of its products.
“What we will do in 2022, is basically
review if we need to take other price in-
creases, that is something that we contin-
ue to monitor, to see if we need to do it
in terms of the margins of our products,
but also to see the price sensitivity of the
decisions we take.
“Obviously we have to balance price
and volume, so this is something we give
a lot of attention to,” he added.
Folkerts noted that Heineken Malaysia
already adjusted prices for certain products
in 4QFY21 to compensate for the rising
input costs.
“Last year we announced that we would
be revising prices in September 2021 for
our can products, and we have also done
another price increase in the fourth quarter
for the on-trade business,” he said.
11 THEEDGE CEO MORNING BRIEF
H O M E
Heineken Malaysia Bhd’s quarterly earnings
Net profit
(RM mil)
120
100 680.00
602.53
80
525.14 512.58
60
40
20
52.81 65.70 103.30 91.17
0 300
-20
1Q 2Q 3Q 4Q
FY19
Source: Bursa Malaysia Heineken Malaysia’s financial year ends on Dec 31
Heineken Malaysia closes FY21 on a high note
as 4Q profit jumps on reopening of economy
BY IZZUL IKRAM
theedgemarkets.com
KUALA LUMPUR (Feb 16): Heineken
Malaysia Bhd’s net profit for the fourth quar-
ter ended Dec 31, 2021 (4QFY21) surged
76.93% to RM95.85 million from RM54.17
million a year ago, as the brewer saw im-
proved sales for its products following the
reopening of the domestic economy.
The group also attributed the increase in
net profit to effective cost management, and
the absence of a one-off provision of RM14
million in December 2020 for costs asso-
ciated with its organisational restructuring
exercise implemented in 2021.
Quarterly revenue for 4QFY21 grew
33.39% to RM692.34 million from
RM519.02 million in 4QFY20 amid high-
er sales volume driven by the easing of Cov-
id-19 restrictions, as well as earlier festive
sell–in for the Chinese NewYear celebrations
this year, its bourse filing showed.
Following the stronger 4QFY21, the
group closed its FY21 with a 59.33% jump
in net profit to RM245.68 million from
RM154.2 million in FY20, as revenue rose
to RM1.98 billion from RM1.76 billion.
With the improved earnings, the group
proposed a single-tier final dividend of 66
sen per share, which raised its dividend pay-
out for FY21 to 81 sen per share, up from
51 sen for FY20.
“Despite a longer lockdown period of 11
weeks in 2021 versus 7 weeks in 2020, group
revenue rose 12%, mainly due to improved rev-
enue management, and PBT (profit before tax)
grew 62%. Excluding the one-off settlement
and provision in 2020, group PBT would have
grown by 46%. The group undertook bold
moves to right-size the organisation and cost
base, whilst driving revenue growth through
effective commercial and marketing execu-
tions,” Heineken said in a statement.
Revenue
(RM mil)
692.34
800
700
547.74
600
515.89 473.75 519.02
389.85
500
349.42
400
56.96 253.74 61.25 54.17 73.54 51.02 95.85
25.27
200
-18.19
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
FY20 FY21
However, Heineken Malaysia noted that
its annual net profit and revenue are still be-
low FY19 levels, adding this indicates that
its business is still under the recovery phase.
The group’s FY21 net profit is 21.5% lower
compared with the RM312.97 million it posted
in FY19, while its FY21 revenue is 14.69% less
than the RM2.32 billion achieved in FY19.
Looking forward, Heineken Malaysia said
the group remains cautious given the recent
spike in new Covid-19 cases amid high vac-
cination rates, continued closure of interna-
tional borders resulting in lower arrival of
tourists, escalating input costs, and various
logistics challenges posed by the pandemic.
“The group will continue to navigate the
challenging external environment by adapt-
ing to the new market reality, ensuring the
safety of our people, keeping a tight rein on
costs and staying focused on our strategy to
accelerate our business recovery,” it added.
The group also said it welcomes the gov-
ernment’s stance to not increase excise duties
on beers and stouts in Budget 2022, adding
that any hike in excise rates would further
drive illicit alcohol demand.
“As it is, Malaysia’s excise rate for beers
and stouts ranks second highest in the world.
Illegal trade and smuggling have caused the
government to incur huge tax revenue losses,
disrupted legitimate businesses and risked
exposing consumers to cheaper unregulated
illicit alcohol. Heineken Malaysia remains
committed to support the government to
stamp out illicit trade,” said its managing
director Roland Bala.
On Wednesday, Heineken’s share price
closed 28 sen or 1.39% higher at RM20.36,
giving the group a market capitalisation of
RM6.15 billion.
Read also: Heineken casts doubt on 2023
margin target as inflation spikes Click here
 t h u r s d ay f e b r u a ry 1 7 , 2 0 2 2
KUALA LUMPUR (Feb 16): Using a dual
wholesale network (DWN) model to imple-
ment 5G will create confusion in the market,
according to adviser to the United Nation
(UN) on 5G strategy and policy Brett Hann.
Speaking at a media briefing onWednesday
(Feb 16), Haan said the DWN model will raise
a lot of questions that will pose further chal-
lenges in implementing the 5G technology.
“The DWN model, to me personally
raises questions such as — are these enti-
ties friends or competitors?
“Are they going to go to the same cap-
ital markets for financing? Are they going
to the same vendors?
“How are you going to handle cyberse-
curity which is critical? How are you going
to coordinate those two firms? That to me
just creates confusion,” he said.
Hann also stressed that Malaysia will
not suffer the same fate as Mexico in im-
plementing the 5G technology as Malaysia
is learning lessons from other countries.
“The government could have chosen a re-
gional network perspective but they (Malaysian
government) chose a national one which is
totally legitimate and totally understandable.
“[In implementing 5G] you know you
want to have good business operations, have
a good vendor and you want to have some
KUALA LUMPUR (Feb 16): Boosted by
sharply higher palm oil prices, Kuala Lum-
pur Kepong Bhd’s (KLK) net profit jumped
67.69% to RM599.32 million for the first
quarter ended Dec 31, 2021 (1QFY22)
from RM357.41 million a year earlier.
Earnings per share swelled to 55.6 sen
from 33.1 sen, the group’s filing with Bursa
Malaysia showed.
Quarterly revenue surged 58.82% to
RM6.83 billion from RM4.3 billion in
1QFY21.
On a quarter-on-quarter basis, however,
KLK’s net profit was down 4.23% from
RM625.8 million in 4QFY21 despite reve-
nue growing 15.07% from RM5.93 billion,
mainly due to a lower fair value surplus of
RM16.1 million on the valuation of un-
harvested fresh fruits bunches compared
with RM32.8 million in 4QFY21.
KLK did not declare any dividend for
the quarter.
The group said its plantation division’s
quarterly profit more than doubled to
RM607.9 million from RM239 million
in 1QFY21, on the back of significantly
higher crude palm oil (CPO) and palm
kernel (PK) prices as well as recognised
profit from newly acquired subsidiaries.
However, the increase in profit was par-
tially offset by higher unrealised loss of
RM28.7 million (1QFY21: unrealised loss
of RM24.4 million) from fair value changes
on outstanding derivative contracts.
12 TheEdge CEO morning brief
h o m e
Dual wholesale
network model in
5G implementation
will create
confusion,
says expert
by sulhi khalid
theedgemarkets.com
KLK 1Q net profit
jumps 68% amid
soaring palm oil
prices
by justin lim
theedgemarkets.com
The CPO price surged 50.3% year-on-
year to RM4,063 per tonne from RM2,703,
while the PK price jumped 66.9% to
RM2,864 per tonne from RM1,716.
KLK’s manufacturing division reported
a 74% improvement in profit to RM319.6
million from RM183.7 million a year ago,
on the back of a 55.7% increase in revenue
to RM5.51 billion and unrealised gain of
RM44.9 million from fair value changes
on outstanding derivative contracts.
Net profit for the property development
fell 14.5% to RM18.8 million from RM22
million a year earlier, despite higher revenue of
RM56 million compared with RM53.4 million
a year ago.This was attributed to recognition
of profit from projects with lower margins.
Over at the investments division, profit im-
proved marginally to RM23.9 million from
RM22.2 million a year ago, due to better profit
contribution from the farming sector as a re-
sort of transparent reporting,” he shared.
The federal government has yet to de-
cide on the single wholesale network (SWN)
model for 5G rollout in the county and re-
cently, Digital Nasional Bhd (DNB)’s chief
executive officer Ralph Marshall, in his reply
to Bangi member of Parliament (MP) Ong
Kian Ming, stressed that there will be enor-
mous implications should the government
decide on having a DWN model.
“It is highly unlikely that DNB in its
current form will survive should there be
another wholesale network provider.
“With the failure of DNB, the second
wholesale provider will then eventually be-
come a private SWN monopoly.
“There are also financial, legal and rep-
utational implications for the country and
the government should DNB be discon-
tinued,” Marshall said.
Meanwhile, RHB Investment Bank in
its research note on Jan 25 said the DWN
model would cause more challenges, delay
5G execution, and contribute to excess
capacity in the long run.
Its analyst Jeffrey Tan said in a note that
DWN would also negate DNB’s strategic
supply-driven model/mandate, resulting in
potentially higher cost to serve as traffic
and revenue will be shared.
sult of higher average selling price of all crops.
On prospects, KLK said its plantation
profit for FY22 is expected to be better,
supported by buoyant CPO and PK pric-
es and profit contribution from newly ac-
quired subsidiaries.
Despite a challenging operating envi-
ronment posed by volatility of raw material
prices and intense competition, the per-
formance of the manufacturing division
is projected to be satisfactory for FY22.
Shares in KLK closed up eight sen or
0.31% at RM25.60, bringing the group a
market capitalisation of RM27.67 billion.
More on corporate earnings:
Batu Kawan’s 1Q net profit surges 73%
on higher plantation, manufacturing
segments Click here
Gas Malaysia reports marginal 4Q net
profit increase Click here
MGRC returns to the black in 2Q on
higher margins from immunotherapy and
cell therapy distribution Click here
InNature’s 4Q profit jumps q-o-q
following economic reopening, declares
1.5 sen dividend Click here
 t h u r s d ay f e b r u a ry 1 7 , 2 0 2 2
KUALA LUMPUR (Feb 16): Minister of
Finance Inc’s (MoF Inc) wholly-owned
Pengurusan Aset Air Bhd (PAAB) is seek-
ing bids from prospective bidders to build
a new water treatment plant in Semangar
within Johor’s Kulai district, and a wa-
ter-distribution system within the state’s
Kota Tinggi district.
According to PAAB’s tender notice dat-
ed Thursday (Feb 10), the closing date for
the bidding exercise is March 10, 2022.
“PAAB wishes to invite local companies
with the relevant experience and expertise
to submit their bids,” PAAB said.
PAAB, however, said it is “not obliged”
to accept the lowest bid and indicated rea-
sons for rejecting certain bids.
According to PAAB’s website, it was
incorporated on May 5, 2006 with the
objective of being the holding company
for Malaysia’s water assets. It forms part
of the government’s efforts to restructure
the water services industry in the country
to achieve better efficiency and quality,
and to ensure the industry’s sustainability.
RAM Rating Services Bhd (RAM Rat-
ings) said the bond-rating firm believes
PAAB can easily tap the Islamic bond or
KUALA LUMPUR (Feb 16): Khazan-
ah Nasional Bhd has successfully com-
pleted the sale of rights shares attached to
the CITIC Securities Co Ltd shares that
form part of the exchange property un-
der the Malaysian sovereign wealth fund’s
US$320.8 million (about RM1.34 billion)
five-year exchangeable Islamic bonds or
sukuk which give holders the option to re-
ceive cash or CITIC shares upon exchange.
In a statement dated Monday (Feb 14),
Khazanah said adjustments were made to
the exchange property comprising cash and
CITIC shares in respect of the cash-settled
exchangeable trust certificates due 2023 ref-
erencing H-shares of par value of RMB1
each in CITIC.
Khazanah said its Labuan-incorporat-
ed special purpose vehicle Cindai Capital
Ltd is the issuer of the exchangeable trust
certificates.
“On Feb 11, 2022, Khazanah had suc-
cessfully completed the sale of the rights,
pursuant to the proposed rights issue, at-
tached to the CITIC shares that form part
of the exchange property.
“Pursuant to condition 7(f)(i) of the
conditions of the certificates, the exchange
property shall be increased by HK$39.33
million (HK$39,334,474.79) in cash, which
is equivalent to the aggregate realisable value
of rights attributable to the CITIC shares.
“Consequently, the exchange prop-
erty has been adjusted to 93.58 mil-
lion (93,579,192) CITIC shares and
13 TheEdge CEO morning brief
h o m e
MoF Inc-
last year after the group (PAAB) similar-
ly allowed state water operators to defer
backed PAAB
repayments amid collection issues during
the pandemic.
solicits bids for
“Owing to [the] group’s (PAAB) critical
function, RAM expects the government to
construction
maintain close oversight via PAAB’s board
while extending financial assistance when
of new water-
the need arises. The transaction terms re-
quire PAAB to remain a wholly govern-
treatment plant
ment-owned subsidiary — the breach of
this term will constitute an event of de-
fault,” the analysts said.
RAM Ratings has also reaffirmed its
by syafiqah salim AAA/Stable rating for PAAB’s financing
theedgemarkets.com conduit and 100%-owned subsidiary Pen-
gurusan Air SPV Bhd’s (PASB) 30-year
sukuk market for additional funding in RM20 billion Islamic medium-term notes
view of PAAB’s crucial function and re- programme from 2009 to 2039.
lationship with the government. The reaffirmation is premised on
In a note on Friday (Feb 11), RAM RAM Ratings’ view that PASB will con-
Ratings’ analysts Seri Nuralya Munawir tinue to derive substantial financial flex-
and Chong Van Nee said PAAB is expected ibility from the Malaysian government
to continue to gear up as it invests in new via MoF Inc. “To date, the Ministry of
water assets and strives to complete the re- Finance has injected a total RM730 mil-
structuring of the domestic water industry. lion of paid-up capital into PAAB — to-
“The MoF (Finance Ministry) also tal authorised capital is RM1 billion,”
granted PAAB a federal loan moratorium the analysts said.
Khazanah
cash settlement amount has been revised to
294.5594 CITIC shares and HK$686.70
completes sale
in cash,” Khazanah said.
In securities trade terminology, H-shares
of CITIC rights
refer to shares of mainland China firms
which are listed on The Stock Exchange of
shares linked
Hong Kong Ltd and other foreign bourses.
Khazanah via Cindai had in 2018 is-
to former’s
sued the exchangeable sukuk. In a state-
ment on Jan 18, 2018, Khazanah said the
US$320.8m
exchangeable sukuk, which was structured
based on the Islamic principle of Wakalah,
exchangeable
provides the sukuk holder with the option
to receive cash or shares upon exchange.
Islamic bonds
A total of 78 investors subscribed to
the exchangeable sukuk and they comprise
long-only funds, hedge funds, arbitrage
funds as well as asset managers across Asia
by chong jin hun and Europe, according to Khazanah.
theedgemarkets.com “CITIC Securities will be Khazanah’s
eighth offering in an exchangeable sukuk
format, since the inaugural issue of Tele-
kom Malaysia Bhd exchangeable sukuk
in 2006. The various issues have all been
successfully implemented, winning mul-
tiple international awards over the years.
“The exchangeable sukuk will be list-
ed on the Singapore Exchange Securities
Trading Ltd, Labuan International Finan-
cial Exchange Inc and Bursa Malaysia (un-
HK$218.16 million (HK$218,160,170.40) der the exempt regime).
in cash effective from Feb 11, 2022. The “CIMB and J.P. Morgan are the joint
pro rata share of the exchange property at- bookrunners and joint lead managers for
tributable to each US$1,000 nominal val- this exchangeable sukuk transaction,”
ue of certificates for the calculation of the Khazanah said then.
 t h u r s d ay f e b r u a ry 1 7 , 2 0 2 2
KUALA LUMPUR (Feb 16): The price
of crude palm oil (CPO) will remain high
in the coming months, possibly through
the first half of 2022 (1H22), supported
by weaker production prospects for corn
and soybean in South America and the re-
cent move by the Indonesian government
to expand export licencing requirements
for all palm oil products.
Hong Leong Investment Bank
(HLIB) Research has raised its 2022
CPO price forecast to RM4,300 per
tonne — from RM3,500 per tonne pre-
viously — in anticipation of tight supply
of vegetable oils which will continue to
lend support to CPO price for the next
few months.
For 2023-24, HLIB raised its CPO
price forecasts to RM3,300/3,300 per
tonne (versus RM2,900/2,900 per tonne
previously), as the research firm believes
a recovery to palm oil production will take
longer than expected.
“While we continue to believe that
a pullback in CPO price will material-
ise when palm oil output recovers, this
hinges on several uncertainties includ-
ing the entrant of foreign workers into
Malaysian shores, and surging fertiliser
prices, which may result in planters (in
KUALA LUMPUR (Feb 16): RHB In-
vestment Bank Bhd has maintained a ‘buy’
call on Duopharma Biotech Bhd with an
unchanged target price (TP) of RM1.91
per share after registering sturdy numbers
for financial year 2021 (FY21).
The research house said Duopharma
reported a core net profit of RM67 mil-
lion, at 97% of its full-year estimates with
topline growing 12% year-on-year (y-o-y),
sustained by the continued robust demand
for consumer healthcare products and re-
covery in the public health sector.
In a research note on Wednesday (Feb
16), RHB said despite the depreciation
of the ringgit against the US dollar, the
company continued to record resilient
gross margins for the fourth quarter 2022
(4Q22).
“We believe its long-term earnings
growth prospects remain bright, on the
back of its efforts to improve product of-
ferings while venturing into high-value
therapies,” it shared.
Meanwhile, CGS-CIMB reiterated a
‘hold’ call on Duopharma with an un-
changed TP of RM1.60.
The research house said Duopharma’s
FY21 results were in line with its expec-
tation but 4Q21 core earnings per share
(EPS) fell 10% y-o-y due to lower margins.
CGS-CIMB said y-o-y local sales
grew a healthy 8.1% y-o-y, thanks to
14 TheEdge CEO morning brief
h o m e
HLIB raises
particular smallholders) reducing fertil-
iser application to oil palms, hence de-
2022-2024 CPO
railing the anticipated yield recovery,”
HLIB analyst Chye Wen Fei said in a
price forecasts,
note on Wednesday (Feb 16).
Chye said the research firm has main-
expects price to
tained its “overweight” stance on the plan-
tation sector.
remain elevated
This was underpinned by high near-
term CPO prices which will in turn trans-
late to good near-term earnings prospects,
easing environmental, social and govern-
by syafiqah salim ance (ESG) concerns, and decent valu-
theedgemarkets.com ations.
HLIB’s top picks are still IOI Corp
Bhd, with a “buy” call and target price
(TP) of RM4.35, Kuala Lumpur Kepong
Bhd (KLK) (“buy”: TP: RM25.33) and
Sime Darby Plantation Bhd (“buy”: TP:
RM4.48).
At the time of writing on Wednesday,
the Bursa Malaysia Plantation Index went
down 68.98 points to 7,587.44.
IOI Corp shares fell 0.7% at RM4.24,
valuing the plantation group at RM26.77
billion. KLK slipped 0.39% at RM25.42
giving it a market capitalisation of
RM27.46 billion, while Sime Darby Plan-
tation fell 2.13% at RM4.59 with a market
value of RM31.74 billion.
RHB IB keeps
Nonetheless, it said local revenue
eased 14% quarter-on-quarter (q-o-q),
Duopharma
mainly due to seasonally weaker pub-
lic sector demand while 4Q21 export
on ‘buy’ after
revenue, which is 5% of total, remained
tepid at RM8 million due to Covid-19-
its sturdy FY21
led logistical challenges.
However, CGS-CIMB said it forecasts
numbers
a better FY22 performance for Duophar-
ma and raised FY22 core EPS by 11% to
factor in potential one-off RM10 million
tax savings of reinvestment allowance upon
Bernama the commissioning of its K3 plant target-
ed for FY22.
“We now see core EPS growing a strong
19% in FY22 from private/public sector
sales growth and tax savings, before moder-
ating to 4% in FY23 due to some softening
in CHC sales growth post-Covid-19 and
lack of tax savings, and then resuming to
10% in FY24,” it added.
More on brokers calls:
HLIB Research: Risk-reward profile
for FBM KLCI now less attractive
Click here
continued good take-up of its consum-
er healthcare (CHC) products, such as
immunity-boosting products which is Sime Darby Plantation’s recruitment
20% to 25% of total sales and recovery fees reimbursement seen as step in
in public sector sales. right direction Click here
 t h u r s d ay f e b r u a ry 1 7 , 2 0 2 2 15 TheEdge CEO morning brief

h o m e

DNeX hits
KUALA LUMPUR (Feb 16): Dagang
NeXchange Bhd’s share price (DNeX) Dagang NeXchange Bhd

all-time high
hit a record high of RM1.27 on Wednes- Vol (bil) RM
day (Feb 16) and was the most active- 1.5 1.5

of RM1.27,
ly traded stock of the day on the local RM1.27
bourse.

tops active
The stock opened two sen higher at
RM1.15 and climbed another 12 sen to 1 1.0

close at RM1.27, up 12.39% from Tues-
day’s close, after some 272.72 million
shares were traded. At current price, the
company’s market capitalisation stands at
RM3.82 billion.
The reason behind interest in DNeX is
unclear, but investors might have turned
more bullish on its prospects given greater
coverage of the company.
CGS-CIMB has initiated coverage on
DNeX with a target price of RM1.60.
In a note on Wednesday, the research
house said DNeX is well positioned to
benefit from SilTerra’s turnaround, un-
derpinned by an ongoing semiconductor
chip shortage and structural shift towards
More-than-Moore (MtM) devices. It pro-
jected SilTerra to invest over RM900 mil-
lion capex in FY22-24F.
“The group plans to increase its
mask layer (ML) capacity by 20% to
stocks list
by sulhi khalid
theedgemarkets.com
10m ML/annum by CY23F.
“We expect SilTerra to secure two
new long-term agreements in 1HCY22F
that will take up 80% of its capacity,”
it said.
CGS-CIMB projected DNeX to post
a three-year core EPS CAGR of 453%
(FY21-24F) driven by: 1) higher wafers
ASP; 2) higher wafers production volume
on the back of new capacity expansion; 3)
higher average crude oil prices for Ping
Petroleum Ltd; and 4) higher production
volume at Ping on the back of its new capex
programme.
0.5 0.5
RM0.175
0 0.0
Nov 29, 2020 Feb 16, 2022
Source: Bloomberg
“DNeX also enjoys a lower effective tax
rate given that SilTerra had over RM12 bil-
lion as of Jul-21 in unrecognised deferred
tax assets that could be offset against its
future profits.
“Note that we have yet to account for:
1) contributions from emerging technol-
ogy platforms like silicon photonics that
command premium ASP; and 2) commer-
cialisation of Ping’s Avalon oilfield,” it said.

news In brief

Chin Hin Group Property to diversify into water infrastructure

construction works
KUALA LUMPUR (Feb 16): Chin Hin Group Property Bhd (CHGP) plans to acquire
a 60% stake or 15 million shares in Asia Baru Construction Sdn Bhd (ABCSB) for
RM30 million cash, to diversify into water infrastructure construction works. In a
filing, CHGP said its subsidiary Chin Hin Construction Sdn Bhd inked a conditional Scomi unit secures letter of intent
share sale agreement with a number of ABCSB shareholders on Wednesday for for RM24m solar PV plant project
the stake purchase. ABCSB is mainly involved in the construction of water supply KUALA LUMPUR (Feb 16): Scomi
related works as a main contractor. The acquisition, expected to be completed by the Group Bhd said its 51%-owned
second quarter of 2022, will allow CHGP to have indirect access to ABCSB’s ongoing subsidiary Scomi SGSB Sdn Bhd has
and future projects. ABCSB is now undertaking about RM385.49 million worth of accepted a letter of intent (LOI) for an
projects. — by Izzul Ikram engineering, procurement, construction
and commissioning project valued at
RM23.9 million. The project involves the
Favelle Favco’s majority shareholder ups stake to 62.85% development of a 7.992 MWp rooftop
KUALA LUMPUR (Feb 16): Favelle Favco Bhd’s majority shareholder Mac Ngan photovoltaic (PV) plant for a local
Boon @ Mac Yin Boon, who has been mopping up shares in the construction crane educational institution, said Scomi in a
manufacturer since last December, has raised his stake to 62.85% or 149.4 million bourse filing. The LOI was awarded by
shares. Mac made the latest purchase of 330,500 shares (0.15% stake) from the open renewable energy developer Synergy
market on Tuesday (Feb 15), Favelle Favco’s bourse filing showed. The purchase was Generated Sdn Bhd, which owns the
made via Muhibbah Engineering (M) Bhd, in which he holds a 15.35% equity interest. remaining 49% stake in Scomi SGSB. “The
Mac has been increasing his stake in Favelle Favco since Dec 16, 2021, when he appointment of Scomi SGSB as the main
acquired 18.15 million shares, or 8.14% of the company’s 222.87 million outstanding contractor is subject to the terms and
shares, from the open market. It is unclear what the co-founder and managing director conditions of the conditional LOA (letter
of Muhibbah Engineering plans to do with his increased stake in Favelle Favco. For of award) to be issued by the educational
the third quarter ended Sept 30, 2021, Favelle Favco’s net profit more than doubled institution to Synergy,” said Scomi. Scomi’s
to RM10.38 million from RM4.12 million a year earlier, while revenue improved 4% share price closed down 16.67% or half
to RM135.59 million from RM130.41 million. At Wednesday’s market close, Favelle a sen to 2.5 sen, giving the loss-making
Favco shares were unchanged at RM2.53, giving the company a market capitalisation of group a market value of RM22.79 million.
RM563.87 million. — by Seah Eu Hen — by Syafiqah Salim
 t h u r s d ay f e b r u a ry 1 7 , 2 0 2 2
h o m e
Singapore in
SINGAPORE (Feb 16): Singapore is cur-
rently in discussion with Malaysia on ex-
discussion with
panding the Vaccinated Travel Lane (VTL)
land arrangement for private vehicles, as
Malaysia on
well as private coaches, said Gan Kim
Yong, the co-chair of the republic’s Multi
expanding VTL
Ministry Taskforce (MTF) on Covid-19.
At present, no private vehicles are al-
land to private
lowed to travel over land between the two
countries except for public buses.
vehicles
“... when we are ready we will make the
necessary and appropriate announcement,”
said Gan, who is also the Trade and Indus-
try Minister, at a virtual press conference
here on Wednesday. by Massita Ahmad
The MTF was asked when private ve-
hicles will be allowed into both countries.
Meanwhile, Minister for Transport S
Iswaran said Singapore would deepen and
extend VTLs with ASEAN neighbours that
include Malaysia, Indonesia,Thailand, and
the Philippines.
“We are in advanced discussions to ex-
pand the VTLs to Penang and Kota Kina-
balu. We look forward to launching these
soon,” he said at the same press conference.
Singapore has commenced the VTL by
air and land with Malaysia from Nov 29
last year but on a limited scale.
Singapore will also streamline its bor-
der measures for the VTL that will see,
among others, long-term pass holders no
Malaysia’s
KUALA LUMPUR (Feb 16): The Insti-
tute for Democracy and Economic Af-
current
fairs (IDEAS) believes that the inflation-
ary pressures and price hikes that Malaysia
inflationary
is currently facing are temporary and can
be effectively controlled through proper
pressures, price
monetary and fiscal policies.
According to the Department of Statis-
hikes temporary
tics Malaysia, the country’s inflation rate
(as measured by the consumer price index)
— IDEAS
increased 3.2% year-on-year in December
2021, mainly due to the rise in food and
fuel prices and the low base effect.
In a statement on Wednesday, IDEAS
said even though the inflationary trend is dis-
concerting, inflation can be controlled effi-
ciently in the short to medium term through
the timely deployment of monetary policies.
It noted that the US Federal Reserve
has signalled that it will increase its over-
night policy rate (OPR) multiple times this
year in order to tame the US’ own inflation.
“Malaysia will likely follow suit by in-
creasing its OPR gradually in 2022 and
2023, whereby Bank Negara Malaysia is
expected to increase the OPR by about 50
basis points in the later half of this year,”
it said.
Meanwhile, IDEAS director of economic
and business unit and acting research direc-
tor Dr Juita Mohamad said the current rise
16 TheEdge CEO morning brief
longer needing to apply for a Vaccinated
Travel Pass or an Entry Approval to enter
Singapore, from Feb 22.
Others including travel history require-
ment will be reduced from 14 to seven
days; the seven-day enhanced testing pro-
tocol will be ceased; and VTL travellers will
no longer need to perform an on-arrival
Polymerase Chain Reaction test.
Meanwhile, the Stay-Home Notice du-
ration will be standardised to seven days
across all country/region risk categories in
view of Omicron’s shorter incubation period.
To facilitate vaccinated travel, the re-
public will restore and progressively in-
Bernama crease VTL quotas.
The air VTL quotas will be fully re-
Bloomberg stored with immediate effect while the land
quotas will be fully restored from Feb 22.
The sale of bus and flight tickets for the
land and air VTL was temporarily suspend-
ed last Dec 23, and resumed on Jan 21.
However, the quota for the bus and
flight tickets has been reduced by 50% from
the existing capacity for land and air routes.
A view of the Johor-Singapore Causeway
across the Straits of Johor. At present, no
private vehicles are allowed to travel over
land between Malaysia and Singapore
except for public buses.
in inflation is a global issue, stemming from
stronger demand and higher energy pric-
es, after two years of battling the pandemic
through the implementation of lockdowns.
“The pandemic and the lockdowns led
to both demand and supply shocks at a
global scale. As a small and open economy,
Malaysia is not immune to the devastating
aftermath posed by the pandemic.
“Inflationary pressure is further com-
pounded by the recent flooding in the country,
which has put a strain on the supply of selected
essential goods produced locally,” she said.
Juita said to minimise the negative ef-
Bernama fects of the price hikes on consumers in
the short term, fiscal policies including fuel
and electricity consumption subsidies and
price ceiling of essential goods have been
deployed by the government in the past.
However, she noted that in the long
term, these instruments and interventions
need to be rationalised in order to avoid
sustained dependence on subsidies and
price ceilings, which would not be eco-
nomically viable over the long term.
“In our view, a formalised social safe-
ty net programme needs to be developed
to ensure financial assistance and aid can
be targeted and funnelled to the vulnera-
ble households and groups effectively and
transparently,” she said.
 t h u r s d ay f e b r u a ry 1 7 , 2 0 2 2
Ex-Bangladesh
diplomat released
by Malaysian
immigration on
Wednesday
by hafiz yatim
theedgemarkets.com
KUALA LUMPUR (Feb 16): Former
Bangladeshi High Commissioner to Ma-
laysia M Khairuzzaman, who was appre-
hended by Malaysian authorities last week
and faces the possibility of being deported,
was released by the Immigration Depart-
ment on Wednesday (Feb 16).
His counsel Edmund Bon Tai Soon con-
firmed to theedgemarkets.com that he had
been released by the Putrajaya Immigration
Department close to 4pm on Wednesday.
“Yes, he has been released this after-
noon,” the lawyer said.
Another lawyer, Ngeow ChowYing, who
was with the former diplomat as he was
freed in Putrajaya, said Khairuzzaman was
released without any conditions imposed.
On Tuesday (Feb 15) it was report-
ed that High Court Justice Mohamed
KUALA LUMPUR (Feb 16): The High
Court on Wednesday (Feb 16) fixed hearing
of senior lawyer Tan Sri Muhammad Shafee
Abdullah’s stay application in his RM9.41
million income tax case for June 16 before
Judicial Commissioner Datuk Mohd Arief
Emran Ariffin.
“The court fixed June 16 in the after-
noon, to hear our stay of proceedings ap-
plication,” Wee Yeong Kang from Messrs
Shafee & Co, who is a counsel for Shafee,
told theedgemarkets.com when contacted.
The date was fixed at a case management
earlier on Wednesday before High Court
senior assistant registrar Nurul Izzah Hasan
Basri, with Mohamad Ezmeer Zulkarnaen
Asnizar representing the plaintiff (government
of Malaysia) and Wee, the defendant Shafee.
Prior to this, the Inland Revenue Board
(IRB) had filed an objection against Shafee’s
application for a stay of proceedings in its suit
against him to seek payment of income tax
arrears amounting to RM9.41 million, pend-
ing the disposal of his appeal to the Special
Commissioners of Income Tax of Malaysia.
Shafee, 70, filed the application last year
which, among other things, sought an or-
der for the proceedings to be temporarily
suspended, pending the outcome of ap-
plications filed by former prime minister
17 TheEdge CEO morning brief
h o m e
Zaini Mazlan had ordered an interim stay
against the department from deporting the
70-year-old who is on a United Nations
High Commission for Refugees (UNHCR)
card and has been in Malaysia since 2007.
His family, however, is in the US.
Khairuzzaman’s habeas corpus appli-
cation which was also filed by Bon’s firm
Messrs AmerBon has been scheduled to
be heard on May 20.
The retired army major was accused by
the Bangladeshi government to be involved
in the 1975 assassination of the country’s
founder Sheikh Mujibur Rahman but was
later acquitted.
He was also reported by the Bangladeshi
media to be linked to “jail killings” there,
but he was later acquitted and appointed
High Commissioner to Malaysia in 2007.
In the “jail killings”, Bangladeshi na-
tional leaders Syed Nazrul Islam, Tajuddin
Ahmed, Mansur Ali and AHM Quamruz-
zaman were murdered in Dhaka Central
Jail on Nov 3, 1975.
After the Awani League-led government
came to power in 2009, Khairuzzaman was
recalled to Dhaka, but he refused to go and
obtained the UNHCR card and remained
in Malaysia.
Commenting on the former diplomat’s
arrest, Home Minister Datuk Seri Hamzah
Zainuddin said it was done according to
the law after the authorities received a re-
quest to do so and found it valid.
Court sets June 16
to hear Shafee’s
bid to stay income
tax case
by shazni ong
theedgemarkets.com
Datuk Seri Najib Razak and his son Da-
tuk Mohd Nazifuddin Najib at the Feder-
al Court over the payment of income tax
amounting to RM1.69 billion and RM37.6
million, respectively, sought by the IRB.
Shafee said that the outcome of the ap-
peals by Najib and his son could affect the
suit against him. However, in the IRB’s affi-
davit in reply filed on Jan 26 and sighted by
theedgemarkets, the board claimed that Sha-
fee was abusing the process of the court to
delay the claim against him and using Najib’s
case as a “stepping stone” to stay the case.
The Malaysian government, through
the IRB, has filed a suit against Shafee for
alleged unpaid taxes of RM9.41 million for
years 2011, 2012, 2013, 2014 and 2016.
Travel agency
owner claims
trial to money
laundering
involving
RM1.15m
Bernama
KUALA LUMPUR (Feb 16): An
owner of a travel agency on Wednes-
day (Feb 16) pleaded not guilty in
the Sessions Court to five charges of
engaging in money laundering in-
volving RM1.15 million.
Norani Ismail, 66, was charged
with transferring RM1.15 million,
believed to be proceeds of unlawful
activities, from a current account of
Malayan Banking Bhd belonging to
her company into a Maybank Bhd
current account and a Malayan
Banking Islamic Bhd savings ac-
count belonging to one of her chil-
dren, her Malayan Banking and
CIMB Bank Bhd current accounts
as well as a Hong Leong Bank Bhd
current account belonging to her
company.
She is alleged to have commit-
ted the offences at the Bukit Bintang
branch of Malayan Banking here be-
tween Jan 25 and Oct 3, 2019.
The charges were framed under
Section 4 (1)(b) of the Anti-Mon-
ey Laundering, Anti-Terrorism Fi-
nancing and Proceeds of Unlawful
Activities Act 2001, which provides
an imprisonment for up to 15 years
and fine of not less than five times of
the amount obtained from unlawful
activities, or RM5 million, whichever
is higher upon conviction.
Earlier, deputy public prosecutor
Norazihah Asmuni applied for the
money laundering case to be jointly
heard with another case facing the
woman at the Shah Alam Sessions
Court because it involved the same
transaction.
Judge Ahmad Kamar Jamaludin
allowed the case to be transferred to
the Shah Alam Sessions Court and
allowed the bail of RM15,000 set by
the court to be applied.
The court also set March 8 for
mention of the case.
 t h u r s d ay f e b r u a ry 1 7 , 2 0 2 2 18 TheEdge CEO morning brief

w o r l d

OPEC+ must fix

CAIRO/DUBAI/RIYADH (Feb 16): The session that was closed to the media.
International Energy Agency (IEA) has High prices are hurting many house-

its million-barrel
urged the Organization of Petroleum Ex- holds and could become a drag on eco-
porting Countries and its allies (OPEC+) nomic growth, according to Birol.

supply gap,
to address a widening shortfall in their oil The situation could become more criti-
production as a volatile market sends crude cal if the stand-off between Russia and the

prices rocketing towards US$100 a barrel.
While fuel consumption is bouncing
back from the pandemic, the 23-nation
alliance led by Saudi Arabia is struggling
to restore output it halted. Members need
to fix the issue as the supply gap versus their
target spirals towards one million barrels
a day, IEA executive director Fatih Birol
told a conference in Riyadh via video link.
“There is a significant difference be-
tween the targets that OPEC+ countries set
in terms of their production levels and what
is produced today,” Birol told the meeting
hosted by the International Energy Forum.
“Therefore it is important that OPEC+
countries narrow this gap” and “hopeful-
ly provide more volumes to the market in
order to reduce volatility”.
Plagued by underinvestment and dis-
ruptions, many OPEC+ members are not
able to bring back the barrels they have
pledged. The resulting surge in oil prices is
feeding an inflationary spike that threatens
to derail the global economic recovery, and
inflicting a cost-of-living crisis on millions.
The 10 members of the Organization of
Petroleum Exporting Countries (OPEC)
that are subject to quotas pumped 23.9
million barrels a day in January, accord-
says IEA
by Salma El Wardany, Paul Wallace,
Matthew Martin & Anthony Di Paola
Bloomberg
There is a significant
difference between the
targets that OPEC+
countries set in terms
of their production
levels and what is
produced today.
ing to IEA data, compared with a target
of 24.6 million.
While the alliance’s Middle East heav-
yweights Saudi Arabia, the United Arab
Emirates, and Iraq could fill the gap by tap-
ping their remaining spare capacity, Riyadh
has so far resisted the idea. Saudi Energy
Minister Prince Abdulaziz bin Salman Al
Saud also addressed the conference in a
West over Ukraine escalates.While Moscow
has said some of its troops are returning
their bases, Western officials remain wary.
Geopolitical risks could send crude prices
to US$125 a barrel, according to Congo’s
Energy Minister Bruno Jean Itoua, who
this year holds OPEC’s rotating presidency.
He urged all OPEC members to meet
their production quotas, though financial
and operational hurdles mean there is little
that producers outside the group’s core of
Persian Gulf nations can do.
“We are fighting to respect our commit-
ment,” Itoua said. “We want all the OPEC+
members to do it.”
With midterm elections approaching in
the US, energy costs are becoming an in-
creasingly pressing issue for President Joe
Biden, whose attempts to rein in gasoline
prices by deploying emergency oil stock-
piles met with little success.
The geopolitical dangers are a remind-
er “that we’re still in a place where energy
security cannot be taken for granted”, the
US State Department’s senior adviser for
energy security, Amos Hochstein, told the
conference. The US is keen to collaborate
with consumers and producers to ensure
supplies in these “tough times”, he said.

Ukraine
(Feb 16): While Ukrainian President Vo- ture on Facebook of him Wednesday in
lodymyr Zelenskiy has downplayed the the Azov Sea port of Mariupol.

President targets
likelihood of a large-scale invasion as The September law allows the Na-
Russia masses troops near the border, tional Defense and Security Council to

oligarchs as
he is targeting what he sees as anoth- define an oligarch using three of four
er threat to his country’s sovereignty: criteria: their participation in public life,

world focused on
oligarchs. level of influence over mass media, own-
The president in a national ad- ership or control of a company with a

dress Monday slammed unidentified
businesspeople for fleeing the coun-
try in the face of a US warning of a
potential imminent assault. Russia
has repeatedly denied it is planning to
attack.
Zelenskiy, a former comedian who
campaigned in 2019 on promises to take
back power from oligarchs in the former
Soviet republic, has increased pressure
on the rich since Russia began building
up troop levels in November. Ukraine’s
most influential businessmen have less
than three months remaining to unload
assets that qualify them as oligarchs un-
der a law passed last year.
A f t e r Z e l e n s k i y ’s c o m m e n t s ,
Ukraine’s richest man, Rinat Akhmetov,
returned to the country. His spokes-
woman, Anna Terekhova, posted a pic-
Russian buildup
monopoly and whether assets exceed 2.4
billion hryvnia (US$85 million).
Those given the label will be forced to
disclose their assets and be banned from
by Alex Sazonov & Volodymyr Verbyany financing parties, holding government
Bloomberg posts and participating in privatisations.
Justice Minister Denys Malyuska
reuters identified Akhmetov and billionaire
Igor Kolomoisky as potential targets
in a Forbes Ukraine interview.
Pressure has been exerted in different
ways, as well. Billionaire former presi-
dent Petro Poroshenko was ordered in
January to surrender his passports dur-
ing a treason investigation that he calls
political. Akhmetov’s Metinvest BV was
raided in a tax probe on Feb 1.
Ukrainian President Volodymyr Zelenskiy Click here to read the full story
 t h u r s d ay f e b r u a ry 1 7 , 2 0 2 2
STOCKHOLM (Feb 16): Ericsson may
have made payments to the ISIS terror
organisation to gain access to certain
transport routes in Iraq, in a shock ad-
mission following years of regulatory in-
vestigations.
Shares in the Stockholm-based com-
pany were down almost 14.5% around
lunchtime on Wednesday, its biggest drop
in a day since July 2017.
The admission from Ericsson comes
after the company was accused by the US
Department of Justice (DOJ) in October
of breaching a US$1 billion agreement it
made with prosecutors in 2019 to end a
long-running corruption probe.
In an interview with newspaper Da-
gens Industri, chief executive officer
(CEO) Borje Ekholm said that Erics-
son had identified “unusual expenses
dating back to 2018” but the company
had not yet determined who the final re-
cipient of the money was. “What we are
seeing is that transport routes have been
purchased through areas that have been
controlled by terrorist organisations, in-
cluding ISIS,” Ekholm added.
Ekholm’s comments followed a state-
ment by the telecommunications equip-
ment manufacturer late on Tuesday, in
which the company said that it continued
to “invest significantly” in a probe regard-
ing compliance concerns in its Iraq-based
operations.
NEW YORK (Feb 16): Roblox Corp
shares tumbled the most ever on Wednes-
day morning after the video game platform
reported bookings that missed analysts’ es-
timates in the fourth quarter, reflecting a
retreat from the pandemic-inspired boost
over the last two years.
“As parts of the world began to return
to a more normal way of life, our absolute
numbers have continued to grow,” chief
executive officer David Baszucki said, but
“growth rates have declined as we are com-
paring, in some cases, to quarters last year
in which certain key metrics doubled or
even nearly tripled”.
The stock plunged as much as 24% to
US$55.55 as the market opened in NewYork.
19 TheEdge CEO morning brief
w o r l d
Ericsson shares
A spokesperson for Ericsson declined to
comment when contacted by Bloomberg News.
crash after CEO
The news of the internal investiga-
tion added another embarrassment for
says firm may
the company following a long-running
corruption probe, including a US$1 bil-
have paid ISIS
lion settlement in 2019. A unit of Erics-
son AB pleaded guilty to a years-long
campaign of bribery and corruption in
Asia and the Middle East. In October
by Rafaela Lindeberg last year, the matter resurfaced, after the
Bloomberg DOJ accused the company of breaching
the agreement by failing to provide cer-
bloomberg tain documents to the DOJ.
The new suspect payments likely formed
part of the same corruption probe, accord-
ing to analysts at Handelsbanken.The ana-
lysts do not expect the revelations to trigger
further investigations.
Ekholm told the newspaper that Er-
icsson had spent “considerable resourc-
es trying to understand this as best we
can... financing terrorism is completely
Borje Ekholm unacceptable and something we do not
allow at all”.
On Wednesday, Ericsson’s €500 mil-
Ericsson had identified lion bonds due 2029 suffered their worst
“unusual expenses daily drop since issuance last May, down
dating back to 2018” 1.2 cents to 92.7 cents. The cost of in-
but the company had surance against a default is rising to its
not yet determined highest level since June 2020.
A spokesperson of the Swedish Finan-
who the final recipient cial Supervisory Authority said it would
of the money was. not comment on the situation.
Roblox tumbles
on Tuesday. Analysts were estimating
US$786.2 million, according to data com-
most ever as
piled by Bloomberg.
Average daily active users increased
results take a hit
33% to 49.5 million, slightly less than
the 50.5 million analysts were expecting.
after pandemic
Much of that growth comes from countries
in Asia, Latin America, and Europe. And,
in a shift, more than half of Roblox’s user
base is now over age 13.
by Cecilia D’Anastasio The results mark Roblox’s first full-
Bloomberg year report since it went public in March
2021. Baszucki acknowledged that over
Bookings, which include revenue and the course of two years of the pandemic,
deferred revenue and other adjustments, “our numbers have been affected in sev-
rose 20% from a year earlier to US$770.1 eral ways”, but he urged investors to “take
million, the company said in a statement the long view”.
The gaming industry had a banner year
bloomberg in 2020 at the height of the pandemic. Ro-
blox, a social platform that enables play-
ers to create their own online games and
worlds, captured the undivided attention of
as much as two-thirds of US kids ages nine
to12. That success also made the company
vulnerable when tweens were called back
to classrooms, sports, and other activities.
Click here to read the full story
 t h u r s d ay f e b r u a ry 1 7 , 2 0 2 2 20 TheEdge CEO morning brief

w o r l d

UK inflation
(Feb 16): UK inflation unexpectedly accel- ditionally cut prices in January, and the 2.9%
erated for a fourth straight month in January, fall this year was the smallest since records be-

overshoot adds
highlighting a cost-of- living crisis that’s set to gan in 2005. Furniture and households goods
worsen dramatically this year. also contributed to the pickup in inflation.

to brutal cost of
Prices grew 5.5% over the year, a new Downward pressure on inflation came
three-decade high, driven by clothing and from restaurants, hotels and transport, with

footwear, the Office for National Statistics said
Wednesday. Both economists and the Bank
of England had expected inflation to remain
unchanged at 5.4%. An index that excludes
volatile items quickened to a record 4.4%.
The figures raise the stakes for the BOE,
with investors not ruling out a 50 basis-point
interest-rate increase in March, an unprec-
edented move since it gained independence
in 1997.
The Central Bank is predicting inflation
will peak at around 7.25% in April — more
than triple its target — when a 54% surge in
energy bills is due to take effect at the same
time as taxes go up. By contrast, wages are
increasing at less than 4%.
Inflation, which has surged from just
0.4% a year ago, has overshot forecasts in
seven out of the past nine months. In re-
sponse, current market pricing suggests
interest rates will increase to 2% this year
from 0.5% — the highest since before the
global financial crisis.
Yael Selfin, chief economist at KPMG UK,
said she expected inflation to “hit households
hard” as the impact of the increase in energy
tariffs takes effect.
living squeeze
by Andrew Atkinson, Philip Aldrick
& Lizzy Burden
Bloomberg
Prices grew 5.5% over the year,
a new three-decade high, driven
by clothing and footwear.
“The Bank of England has signalled a de-
termination to get ahead of the curve on in-
flation. In the short run, this will add to the
squeeze on incomes as lenders pass on the
rate increase to borrowers,” she said.
The pound gained after the data, climbing
0.1% at US$1.3553 as of 7.56am in London.
Government bonds fell, with the yield on the
UK’s 10-year securities rising 2 basis points
to 1.599%.
Clothing and footwear prices fell less
sharply than they did in January 2021 when
the country was in lockdown. Retailers tra-
auto fuel prices falling on the month, the ONS
said. Overall, consumer prices fell 0.1% on
the month, the smallest decline for any Jan-
uary since 2011.
Retail price inflation, which determines
payments on index-linked government bonds
among other things, accelerated to 7.8%, the
most since early 1991.
“We understand the pressures people are
facing with the cost of living,” Chancellor of
the Exchequer Rishi Sunak said in a state-
ment. He noted how the government was
responding by providing millions of house-
holds with up to 350 pounds each to help
with rising energy bills.
Separate figures showed pipeline cost pres-
sures continuing to build in January. Fuel and
raw material costs rose 0.9% following a steep
rise in oil prices due to the risk of conflict
between Russia and Ukraine. In response,
producers raised their own prices by 1.2%,
four times the increase in December.
Read also: Soaring inflation to add US$31
billion to cost of UK public debt — think
tank Click here

US Fed should
WASHINGTON (Feb 16):The U.S. Federal tensions between Ukraine and Russia were
Reserve should tighten monetary policy soon exacerbating inflationary pressures that had

act soon and

and decisively to head off what could become seen oil prices jump 77% from December
“quite persistent” inflation,World Bank Chief 2020 to last month.

decisively to raise
Economist Carmen Reinhart (pictured) told “All that is not temporary, and inflation
Reuters in an interview. proves very few things in life are permanent,

rates — World
Reinhart, who has been warning for some but many are quite persistent,” she said.
time that supply chain shocks could result in U.S. Federal Reserve officials remain divid-

Bank’s Reinhart
sustained inflation in the United States and
elsewhere, said any delay by the Fed on in-
creasing interest rates would just prolong the
problem.
“If inflation is indeed more persistent, my
bottom line on Fed policy is ... that if you do
more now, you’ll be better (off) than if you
do too little, too late,” Reinhart said ahead of
Tuesday’s release of the World Bank’s World
Development Report.
Reinhart said the Fed had been signaling a
modest tightening by historical standards but
could shift gears given recent data.
“I’m of the view that if the tendency is to
delay action and be more circumspect, it’s ba-
sically just pushing the problem out in the
horizon,” she added.
Reinhart has been arguing for about a year
that the increase in inflation is unlikely to be
temporary because supply chain shocks have
affected commodity prices, transport costs,
global shipping and other sectors. Escalating
ed over how aggressively to begin upcoming
interest rate increases at their March meeting.
St. Louis Federal Reserve President James
Bullard on Monday reiterated calls for a faster
by Andrea Shalal pace of Fed interest rate hikes, but other Fed
Reuters officials have been less willing to commit to a
half-point hike.
reuters In a paper published last week, Reinhart
and World Bank economist Clemens von
Luckner noted that a more timely and robust
response from major central banks would drive
up funding costs for emerging markets and
developing economies and could worsen ex-
isting debt crises.
But they said the longer-term costs of delay-
ing action would be great. Because the United
States and other advanced economies failed to
tackle inflation quickly during the 1970s, they
ultimately needed far more draconian policies,
which then triggered the second-largest U.S.
recession after World War Two and the debt
crisis of developing countries, they wrote.
 t h u r s d ay f e b r u a ry 1 7 , 2 0 2 2
UBS sees China
private banking
revenue pool
hitting US$163
billion
by Denise Wee
Bloomberg
HONG KONG (Feb 16): China’s pri-
vate banks are poised to share a reve-
nue pool of as much as 1.03 trillion yuan
(US$163 billion) by 2030 as a drive for
common prosperity and the upheaval of
the pandemic have fuelled an appetite for
wealth preservation among the nation’s
wealthy, according to UBS Group AG.
High-net-worth individuals in the
world’s most populous nation might have
214 trillion yuan of investable assets by
2030, marking an annual growth of 14%
from 2020, MayYan, the bank’s head of
Greater China financials equity research,
wrote in a Feb 10 note.
UBS and rivals such as Credit Suisse
Group AG and Goldman Sachs Group
Inc have identified wealth management
as a prime area in their plans to expand
in China — with investable assets esti-
mated to double over the next few years.
While private banking in China re-
mains “one of the fastest growing busi-
ness opportunities”, it is still at a nas-
cent stage, with most banks focused on
product distribution as the main source
of revenue, UBS said.
Even so, President Xi Jinping’s com-
mon prosperity drive has raised concerns
about wealth creation. The push could
have “mixed implications” and in a worst
case scenario cut the industry’s revenue
pool to as low as 224 billion yuan amid
a worsening business climate and as
wealthy individuals move assets offshore,
according to the report.
Chinese banks will likely still dom-
inate while international rivals operat-
ing in Hong Kong and Singapore are
well positioned to capture demand from
wealthy Chinese offshore, according to
the report.
The Swiss bank also expects demand
for property investments among wealthy
Chinese to decline, particularly in low-
er-tier cities.
“We believe cooling property invest-
ment sentiments and expected property
tax legislation could spur a gradual real-
location from investment properties to
financial assets,” UBS said.
21 TheEdge CEO morning brief
w o r l d
reuters
Vanke debt sale
for projects
another sign of
funding thaw
Bloomberg
(Feb 16): Chinese developers are increas-
ing their sales of onshore bonds to fund
project construction, a sign that loosened
government policy is helping to ease the
Meihua becomes
China’s first US
IPO since Didi
crackdown
by Michael Hytha & Julia Fioretti
Bloomberg
(Feb 16): Medical device maker Meihua
International Medical Technologies Co
priced its initial public offering at the mid-
point of a marketed range, the first Chi-
na-based company to list in the US since
July after Didi Global Inc’s IPO sparked
a regulatory backlash.
Meihua sold 3.6 million shares, fewer
than it had originally proposed, for US$10
each on Wednesday to raise US$36 million,
according to a statement. It had marketed
as many as 5 million shares for US$9 to
US$11. At the IPO price, Meihua would
have a market value of US$236 million
based on the outstanding shares listed in
its filings with the US Securities and Ex-
change Commission.
A successful share sale by the medical
device maker would break the impasse for
Chinese companies seeking to go public in
the US. Ride-hailing service Didi — over
the objections of regulators in China —
sector’s liquidity crunch.
China Vanke Co, the country’s sec-
ond-largest builder by contracted sales last
year, on Wednesday issued its second three-
year, 3 billion yuan (US$473 million) bond
of 2022 in the domestic interbank market,
at a coupon rate of 2.98%, according to a
company statement with National Inter-
bank Funding Center. Last month’s bond
was sold at 2.95%. Proceeds of both notes
will go toward building projects, according
to bond issuance documents.
It remains rare for Chinese develop-
ers to help fund projects through the on-
shore bond market, where deal proceeds
largely go toward repaying existing debt.
But authorities have taken steps and are
considering others in response to build-
ers’ cash crunch, from lifting debt limits
related to acquisitions and urging banks to
boost property-related financing to possi-
bly easing usage of presale funds.
Shenzhen-based builder China Over-
seas Enterprise Development Group Co
sold 3 billion yuan of notes last month,
with half the proceeds earmarked for pro-
ject construction, according to a bond is-
suance document.
raised US$4.44 billion in an IPO in June.
Regulators in China announced a cy-
bersecurity probe into the firm and banned
it from adding new customers, marking
the beginning of a broader crackdown that
wiped more than US$1 trillion in value
from US-listed Chinese stocks.
Since then, Beijing unveiled sweeping
new rules tightening scrutiny over firms
listing abroad in an attempt to prevent the
leakage of sensitive data. Scores of main-
land peers rerouted their planned IPOs to
Hong Kong after the SEC halted listings
by Chinese companies.
One small Chinese firm that debuted
in early July and four Hong Kong-based
special purpose acquisition companies have
been the only successful US listings since
Didi, data compiled by Bloomberg show.
Didi, whose shares closed Tuesday at
69% below its IPO price, has said it plans
to delist from the New York Stock Ex-
change and pursue a listing in Hong Kong.
Meihua, which filed originally with the
SEC in August, later revised its filings to
include warnings that the Chinese govern-
ment might exert more oversight of inter-
national offerings.
The company’s offering is being led by
Prime Number Capital LLC, Shengang
Securities Co, Revere Securities LLC and
RF Lafferty & Co, according to the fil-
ing. Meihua’s shares are expected to begin
trading Wednesday on the Nasdaq Global
Market under the symbol MHUA.
 t h u r s d ay f e b r u a ry 1 7 , 2 0 2 2
WASHINGTON (Feb 16): US retail sales
rebounded by more than forecast with the
biggest gain since March, illustrating re-
silient demand despite soaring inflation.
The value of overall purchases rose
3.8% in January after a downwardly
revised 2.5% drop in the prior month,
Commerce Department figures showed
on Wednesday. The figures are not ad-
justed for inflation.
The median estimate in a Bloomberg
survey called for a 2% advance in overall
retail sales from the prior month.
The broad-based advance in sales un-
derscores a steady appetite for merchan-
dise including cars and furniture. While
the Omicron variant and related surge in
Covid-19 infections likely dampened ser-
vices spending in the month, an improv-
ing labour market has helped consumers
continue to spend despite decades-high
inflation and a collapse in confidence.
Eight of the 13 retail categories rose in the
month. Sales at non-store retailers surged
14.5% after plummeting in December. Mo-
tor vehicle sales rose 5.7% following a de-
cline in the prior month. Home furnishing
Cost of growing
food may rise
more amid
weedkiller supply
crunch
by Elizabeth Elkin &
Tarso Veloso Ribeiro
Bloomberg
(Feb 16): A supply crunch is threatening to
cause a spike in prices for the world’s No 1
weedkiller, making it even more expensive
for farmers to grow food.
A major supplier of an ingredient in
glyphosate — an herbicide that’s widely
used by corn, soy, cotton and other farmers
around the world — shut down produc-
tion due to mechanical failures, and repairs
could take three months. Bayer AG, the
maker of Roundup, whose active ingredi-
ent is glyphosate, declared a force majeure
on Feb 11, meaning it may not be able to
meet its sales agreements.
That’s likely going to lead to a supply
crunch, according to a an emailed state-
ment by UK-based analysis company Ag-
bioInvestor, as well as higher prices at a
time when farmers are already experienc-
ing soaring costs for everything from seeds
22 TheEdge CEO morning brief
w o r l d
US retail sales
rise most in 10
months in broad-
based rebound
by Reade Pickert
Bloomberg
stores also posted a solid sales advance.
“Retail sales’ stellar performance in Jan-
uary comes after sizeable downward revi-
sions to December’s reading, suggesting
consumers were hit more than previously
estimated by the latest Covid-19 wave, but
the recovery was rapid,” Bloomberg econ-
omists Yelena Shulyatyeva and Andrew
Husby said in a note.
Growth impact
Receipts at restaurants and bars, the re-
port’s only service-oriented category, fell
0.9%, likely reflecting the record surge in
to fertilizers. Rising production costs are
part of what’s behind near-record global
food prices.
“These impacts will place farmers un-
der further pressure in a number of key
markets” where costs are up, according to
the statement.
Bayer said in an emailed statement that
their supplier is “on track to restore pro-
duction” and that the company has sourced
additional materials. The impact will be
be marginal in terms of annual glyphosate
production, the statement said.
Farmers are anxious.
Aprosoja, an association of soybean
producers in Brazil’s top-producing state
Covid-19 cases seen in January. Data on
inflation-adjusted personal spending and
overall services spending will be out next
week, offering a fuller picture of consumer
outlays in the month.
Before the report, economists were pro-
jecting US economic growth to slow to a
1.7% annualised pace in the first quar-
ter, a sharp deceleration from the 6.9%
seen in the final three months of 2021.
It is possible the stronger-than-expected
report will lead economists to revise their
estimates higher.
However, the expiration of monthly
child tax credit payments — a programme
that gave millions of families up to US$300
per child each month — presents a head-
wind to growth in the near term, on top
of inflation and Covid-19.
Excluding motor vehicles, retail sales
rose 3.3%, topping all expectations. So-
called control group sales — which are
used to calculate gross domestic product
and exclude food services, auto dealers,
building materials stores’ and gasoline sta-
tions — increased 4.8%, also the strongest
since March.
Mato Grosso, sent a letter to Bayer’s chief
executive officer in Brazil asking for assur-
ances that there will be no shortages of
glyphosate. Over 90% of soybeans grown
in Brazil are genetically modified to resist
glyphosate.
“Problems within industrial structures
are not atypical events, and that’s why cor-
porations as big as Bayer have contingency
plans” that the group wants to be informed
of, Aprosoja’s president Fernando Cadore
said in the letter.
Bayer previously said that glyphosate
pricing gained 25% between January 2021
and November, and the company expected
prices to keep rising.
 t h u r s d ay f e b r u a ry 1 7 , 2 0 2 2 23 TheEdge CEO morning brief

w o r l d

IPO mania gets

BANGALORE (Feb 16): A boom in tech- ket regulator frowned on a planned sale of
nology initial public offerings (IPOs) in a substantial amount of shares by investors

reality check in
India risks grinding to a halt after several in the IPO, the people said. The logistics
of the country’s highest-profile start-ups start-up, backed by Carlyle Group Inc as

India after series

tanked soon after listing. well as SoftBank, had previously planned
A raft of prominent tech start-ups, in- to list by March.

cluding Oyo Hotels and logistics provider
Delhivery, are pushing back their public
debuts and preparing to reappraise target
valuations, according to people familiar
with the situation. The duo, both backed
by SoftBank Group Corp, had been among
the country’s highly anticipated offerings.
India’s burgeoning start-up ecosystem
faces a reckoning just weeks after it closed
out a record year for IPOs. Investors have
soured on new tech offerings after the
calamitous public debut of fintech firm
Paytm, as well as the battering received
by newly listed e-commerce operators Zo-
mato Ltd and Nykaa.
IPOs have gotten off to a rough start
this year from New York to London and
Hong Kong amid prospects of interest-rate
hikes, geopolitical tensions, and increased
volatility. In India, the flops have smarted
because 2021 was to have been the vast and
vibrant start-up sector’s coming-out cele-
bration. Instead, regulators have stepped
up scrutiny of IPO candidates after inves-
tors got burned, contributing to the delays.
of flops
by Saritha Rai
Bloomberg
“Investors are no longer enamoured of
the household name start-ups; they want a
path to profitability and returns, not hype
and hoopla,” said Anup Jain, a managing
partner at early-stage investor Orios Ven-
ture Partners.
An Oyo spokesman said by email that it
is standard procedure for the regulator to
ask for clarifications of a preliminary IPO
filing, adding “our bankers are actively en-
gaged with them... we can’t comment on
specifics”. Delhivery declined to respond.
The owners of Delhivery have pushed
back its approximately US$1 billion IPO to
the fiscal year starting in April, said some of
the people, asking not to be named because
the details are private. Delhivery is also re-
viewing its listing plan after the stock mar-
Oyo, which came under scrutiny for its
ownership structure and heavy losses af-
ter filing preliminary IPO documents last
year, is now facing regulatory questions
too. India’s watchdog has made queries
about Oyo’s ongoing litigation with hos-
tel operator Zostel Hospitality Pvt, which
is claiming a stake in the company after a
failed merger in 2016.
The approval for the draft prospectus
of Oyo’s planned US$1.2 billion IPO has
been pending for almost five months. Its in-
vestors include Sequoia Capital and Light-
speed Venture Partners, as well as SoftBank.
Also up in the air are the IPO timings of
Pharmeasy, which goes by API Holdings
Ltd, and automobile marketplace Droom
Technology Ltd, which filed initial IPO
documents in November. Pharmeasy’s in-
vestors include Prosus Ventures and TPG,
while Droom is backed by Beenext and
Lightbox Ventures.
Click here to read the full story

Intel’s CEO is
SAN FRANCISCO (Feb 16): Intel Corp he calls perma-bears. But Gelsinger believed
chief executive officer (CEO) Pat Gelsinger, that others were getting excited about the

tired of Wall
who took the job in February 2021, gives company restoring its prowess and creating
himself an A- grade for his first year running “the new old Intel”.

Street doubting
the chipmaker. Investors are proving to be “In some regards, we’re ahead of where
tougher graders. I thought we’d be; in some areas, we’re not

his turnaround
No one is faulting the 60-year-old’s en- as far as I thought we’d be,” Gelsinger told
ergy level and ambition. But he is trying to Emily Chang in a “Bloomberg Studio 1.0”

plan
reshape the competitive landscape of the
US$500 billion chip industry, turn around
its most iconic company, and change indus-
trial policy in the US and Europe — at a
pace he likes to call “torrid”.
And the plan is going to be expensive.
Very expensive. In Ohio, Gelsinger is spend-
ing US$20 billion to build the world’s big-
gest chip-making facility. He is also planning
an expansion in Europe, making deals and
ramping up research spending — weigh-
ing on Intel’s once-dependable profit mar-
gins. That is testing the patience of inves-
tors, who have sent the shares down 22%
in the past year.
Just this week, Intel agreed to buy Tower
Semiconductor Ltd for US$5.4 billion, part
of a push into making chips on a contract
basis for other companies.
In a Bloomberg Television interview, Gel-
singer acknowledged that Intel’s comeback
will not happen overnight but slammed Wall
Street analysts for sticking to a negative view.
The executive said he is “p---ed” off at what
conversation airing Wednesday night. “And
it really is more a statement of the massive
challenge in front of us.”
This is Gelsinger’s second stint at Intel,
by Ian King having spent decades at the chipmaker be-
Bloomberg fore leaving to run VMware Inc in 2009.
When he returned as CEO last year, the
bloomberg hope was he could chart a new course —
but also remember what made Intel great
in the first place.
Within a few weeks of rejoining the com-
pany, Gelsinger outlined an aggressive strat-
egy aimed at reclaiming the manufactur-
ing leadership that his predecessors had
allowed to slip. He followed that up with
his plans to rebuild production in the US
and Europe, aiming to counterbalance a
shift of manufacturing to Asia. He has also
lobbied for billions of dollars in govern-
ment support.
But it could be an uphill fight.
Pat Gelsinger Click here to read the full story
 T H U R S D AY F E B R U A RY 1 7 , 2 0 2 2
M A R K E T S
CPO RM 5,604.00-53.00 OIL US$ 94.751.47 RM/USD 4.1845 RM/SGD 3.1151 RM/AUD 3.0019 RM/GBP 5.6787 RM/EUR 4.7612
Top 20 active stocks
NAME VOLUME CHANGE CLOSE YTD MARKET
(MIL) (RM) CHANGE CAP
(%) (RM MIL)
DAGANG NEXCHANGE BHD 272.70 0.140 1.270 67.11 4007.3
SMTRACK BHD 119.20 0.015 0.225 18.42 153.9
KNM GROUP BHD 106.9 0.000 0.185 23.33 680
TA WIN HOLDINGS BHD 79.2 0.000 0.160 28 546.3
AHB HOLDINGS BHD 60.9 0.005 0.245 88.46 91.7
HIBISCUS PETROLEUM BHD 56.1 0.010 1.150 41.1 2308.6
AT SYSTEMATIZATION BHD 52.7 0.000 0.030 0 167.6
OPCOM HOLDINGS BHD 46.1 0.110 1.150 20.42 321
PUC BHD 43.2 0.020 0.170 17.24 251
WIDAD GROUP BHD 42.3 0.005 0.340 -6.85 935.9
MY EG SERVICES BHD 40.6 0.010 1.020 -4.67 7,535.3
DATAPREP HOLDINGS BHD 38.2 -0.015 0.380 -53.09 255.7
EVERGREEN FIBREBOARD BHD 36.4 -0.070 0.500 7.53 422.7
OVERSEA ENTERPRISE BHD 35.8 0.005 0.140 16.67 158.9
BSL CORP BHD 34.4 -0.025 0.420 -58.82 91.8
PERTAMA DIGITAL BHD 33.1 -0.040 0.825 42.24 357.5
EASTLAND EQUITY BHD 32.7 -0.010 0.075 5.34 37.3
SARAWAK CONSOLIDATED 28.9 0.025 0.230 12.20 133.9
NWP HOLDINGS BHD 28.8 -0.010 0.230 -6.12 121.1
MANAGEPAY SYSTEMS BHD 28.1 0.025 0.245 19.51 211
Data as compiled on Feb 16, 2022 Source: Bloomberg
Top gainers (ranked by %)
NAME CLOSE CHANGE VOLUME YTD MARKET
(%) (‘000) CHANGE CAP
(%) (RM MIL)
DAYA MATERIALS BHD 0.010 100.0 94.0 0.00 20.4
EDUSPEC HOLDINGS BHD 0.020 33.3 3050.0 33.33 60.9
METRONIC GLOBAL BHD 0.020 33.3 296.3 0.00 43.4
BORNEO OIL BHD 0.030 20.0 2,100.20 0.00 224.1
AE MULTI HOLDINGS BHD 0.035 16.7 782.0 16.67 75.7
XIDELANG HOLDINGS LTD 0.040 14.3 11.90 14.29 84.6
CATCHA DIGITAL BHD 0.165 13.8 100.0 3.13 22.2
PUC BHD 0.170 13.3 43203.9 17.24 251.0
DAGANG NEXCHANGE BHD 1.270 12.4 272717.6 67.11 4007.3
SARAWAK CONSOLIDATED 0.230 12.2 28865.6 12.20 133.9
KPOWER BHD 0.425 11.8 24988.8 1.19 230.7
MANAGEPAY SYSTEMS BHD 0.245 11.4 28144.4 19.51 211.0
OPCOM HOLDINGS BHD 1.150 10.6 46131.4 20.42 321
FSBM HOLDINGS BHD 0.210 10.5 1847.0 13.51 29.7
THETA EDGE BHD 0.870 10.1 6556.5 2.35 93.3
PROGRESSIVE IMPACT CORP BHD 0.110 10.0 2001.0 4.76 72.1
KEIN HING INTERNATIONAL BHD 1.140 9.6 840.3 10.68 124.1
HB GLOBAL LTD 0.185 8.8 2832.7 -7.5 142.5
CREST BUILDER HOLDINGS BHD 0.575 8.5 105.5 7.48 93.2
ARTRONIQ BHD 0.32 8.47 12114.8 -47.97 101.7
Data as compiled on Feb 16, 2022 Source: Bloomberg
Top gainers (ranked by RM)
NAME CLOSE CHANGE VOLUME YTD MARKET
(RM) (‘000) CHANGE CAP
(%) (RM MIL)
MALAYSIAN PACIFIC INDUSTRIES 38.140 1.160 327.8 -22.73 7,585.90
SAM ENGINEERING & EQUIPMENT 23.540 0.940 92.4 5.09 3,186.10
NESTLE MALAYSIA BHD 134.500 0.600 73.2 0.22 31,540.30
BATU KAWAN BHD 25.740 0.440 39.9 13.39 10,144.10
HEINEKEN MALAYSIA BHD 20.360 0.280 1,371.30 -2.30 6150.7
CI HOLDINGS BHD 3.350 0.250 167.00 17.54 542.70
PMB TECHNOLOGY BHD 18.100 0.200 178 47.39 3,851.70
KOBAY TECHNOLOGY BHD 4.730 0.200 1,796.20 -21.56 1,533.40
FAR EAST HOLDINGS BHD 3.180 0.180 10.30 7.80 1888.4
MALAYSIA AIRPORTS HOLDINGS 6.400 0.180 1658.8 7.02 10,618.80
CARLSBERG BREWERY MALAYSIA 20.200 0.180 36.5 0.60 6,176.10
PRESS METAL ALUMINIUM HOLDINGS 7.000 0.160 17422.7 21.11 56533.5
SARAWAK OIL PALMS BHD 4.670 0.150 1,976.40 33.81 2,669.80
VITROX CORP BHD 8.000 0.150 242.2 -19.68 7,556.50
DAGANG NEXCHANGE BHD 1.270 0.140 272717.6 67.11 4007.3
FORMOSA PROSONIC INDUSTRIES 3.950 0.130 1,656.50 5.33 999.6
TELEKOM MALAYSIA BHD 5.480 0.130 4190 -0.36 20,679.90
MALAYSIA SMELTING CORP BHD 4 0.13 2320.9 23.08 1680
TONG HERR RESOURCES BHD 3.07 0.12 156.7 5.5 471.3
ORIENTAL HOLDINGS BHD 5.770 0.120 164.1 9.9 3579.5
Data as compiled on Feb 16, 2022 Source: Bloomberg
24 THEEDGE CEO MORNING BRIEF
World equity indices
CLOSE CHANGE CHANGE CLOSE CHANGE CHANGE
(%) (%)
DOW JONES 34,988.84 422.67 1.22 INDONESIA 6,850.20 42.70 0.63
S&P 500 4,471.07 69.40 1.58 JAPAN 27,460.40 595.21 2.22
NASDAQ 100 14,620.82 352.23 2.47 KOREA 2,729.68 53.14 1.99
FTSE 100 7,591.49 -17.43 -0.23 PHILIPPINES 7,452.82 142.88 1.95
AUSTRALIA 7,284.93 78.00 1.08 SINGAPORE 3,439.30 17.92 0.52
CHINA 3,465.83 19.74 0.57 TAIWAN 18,231.47 279.66 1.56
HONG KONG 24,718.90 363.19 1.49 THAILAND 1,701.45 16.76 0.99
INDIA 57,996.68 -145.37 -0.25 VIETNAM 1,492.10 -0.65 -0.04
Data as compiled on Feb 16, 2022 Source: Bloomberg
Top losers (ranked by %)
NAME CLOSE CHANGE VOLUME YTD MARKET
(%) (‘000) CHANGE CAP
(%) (RM MIL)
DOLOMITE CORP BHD 0.020 -20.000 53.6 -33.33 11.8
JERASIA CAPITAL BHD 0.070 -17.650 122.1 -56.25 5.7
DGB ASIA BHD 0.025 -16.670 160.8 -16.67 40.5
SCOMI GROUP BHD 0.025 -16.670 768.0 25.00 27.3
AGESON BHD 0.025 -16.670 1,816.80 -37.5 39
TPC PLUS BHD 0.195 -15.220 53.7 2.63 60.1
FIBON BHD 0.380 -14.610 40.0 -7.32 37.1
ALAM MARITIM RESOURCES BHD 0.030 -14.290 261.4 20.00 45.9
SANICHI TECHNOLOGY BHD 0.030 -14.290 2565.3 20.00 42.1
MLABS SYSTEMS BHD 0.035 -12.500 342.2 16.67 50.7
EVERGREEN FIBREBOARD BHD 0.500 -12.280 36437.2 7.53 422.7
OSK VENTURES INTERNATIONAL 0.43 -12.24 0.9 -16.5 84.5
EASTLAND EQUITY BHD 0.075 -11.760 32671 5.34 37.3
KEN HOLDINGS BHD 0.515 -11.210 9.0 -12.71 92.4
KOMARKCORP BHD 0.120 -11.110 24449.1 4.35 69.3
ABLEGROUP BHD 0.160 -11.110 26730.5 33.33 42.2
SAPURA ENERGY BHD 0.040 -11.110 14,687.3 -20.00 639.2
MALAYSIAN GENOMICS RESOURCE 1.220 -8.960 16148.8 5.17 151.5
ADVANCE INFORMATION 0.115 -8.000 486.1 -11.54 30.6
MERIDIAN BHD 0.060 -7.690 27731.0 -7.69 54.3
Data as compiled on Feb 16, 2022 Source: Bloomberg
Top losers (ranked by RM)
NAME CLOSE CHANGE VOLUME YTD MARKET
(RM) (‘000) CHANGE CAP
(%) (RM MIL)
PIE INDUSTRIAL BHD 2.77 -0.23 5557.1 -27.11 1063.8
GENTING PLANTATIONS BHD 7.80 -0.15 2,813.80 16.42 6998.1
HENGYUAN REFINING CO BHD 4.21 -0.14 557.9 8.79 1263.0
FRASER & NEAVE HOLDINGS BHD 23.84 -0.14 73.7 -3.64 8744.0
NEGRI SEMBILAN OIL PALMS BHD 3.50 -0.12 14.8 13.64 245.7
MALAYSIAN GENOMICS RESOURCE 1.22 -0.12 16148.8 5.17 151.5
AEON CREDIT SERVICE M BHD 15.00 -0.10 31.1 10.13 3829.6
EUROSPAN HOLDINGS BHD 1.12 -0.08 20.5 1.82 49.8
PETRONAS CHEMICALS GROUP BHD 9.30 -0.08 6987.9 4.26 74400.0
PANASONIC MANUFACTURING 28.40 -0.08 16.7 -1.73 1725.2
DIALOG GROUP BHD 2.81 -0.07 7694.1 7.25 15855.6
EVERGREEN FIBREBOARD BHD 0.50 -0.07 36437.2 7.53 422.7
YINSON HOLDINGS BHD 5.39 -0.07 1303.9 -10.17 5747.3
PECCA GROUP BHD 3.27 -0.07 315 -4.39 629.2
CHIN HIN GROUP BHD 2.39 -0.07 1876.9 -8.43 2114.4
FIBON BHD 0.38 -0.07 40 -7.32 37.1
KEN HOLDINGS BHD 0.52 -0.07 9 -12.71 92.4
OSK VENTURES INTERNATIONAL 0.43 -0.06 0.9 -16.5 84.5
SAMAIDEN GROUP BHD 1.29 -0.06 571.9 15.18 276.3
KECK SENG MALAYSIA BHD 3.55 -0.05 14 3.2 1275.5
Data as compiled on Feb 16, 2022 Source: Bloomberg