The Edge - 07 June 2024

CEOMorningBrief FRIDAY, JUNE 7, 2024 ISSUE 776/2024 theedgemalaysia.com

CEOMorningBrief FRIDAY, JUNE 7, 2024 ISSUE 776/2024 theedgemalaysia.com NVIDIA, MICROSOFT AND APPLE ARE BIGGER THAN CHINA’S STOCK MARKET p18 Report on Page 3. Surge in buying interest in WCT and Malton HOME: MBSB to actively compete for CASA deposits — CEO p2 Tasco to invest additional RM400 mil to expand warehouse capacity over next two years p4 Malaysia’s automotive supply chain costs 30% more than China’s, says Geely chairman — report p4 Duopharma aiming at 10% revenue boost from new contracts from Pharmaniaga in next two years p7 Cyprus cabinet revokes Jho Low’s citizenship and passport — report p15 Report on Page 2. ECB cuts rates even as inflation fight goes on REUTERS

FRIDAY JUNE 7, 2024 2 THEEDGE CEO MORNING BRIEF published by ( 2 6 6 9 8 0 - X ) tel . 603-77218000 Level 3, Menara KLK, 1 Jalan PJU 7/6, Mutiara Damansara, 47810, Petaling Jaya, Selangor, Malaysia publisher + ceo . Ho Kay Tat editor-in-chief . Kathy Fong chief commercial officer . Sharon Teh chief operating officer . Lim Shiew Yuin editors . Jenny Ng . Tan Choe Choe to contact editors: [email protected] to advertise: [email protected] the edge ceo morning brief Read from desktop or mobile device. You can print in A4 to read. Set print mode to fit or shrink oversize page. to get on emailing list [email protected] ECB cuts rates even as inflation fight goes on MBSB to actively compete for CASA deposits — CEO FRANKFURT (June 6): The European Central Bank went ahead with its first interest rate cut since 2019 on Thursday, citing progress in tackling inflation even as it acknowledged the fight was far from over. In new forecasts released with the widely flagged rate cut, the ECB said it expected inflation to average 2.2% in 2025 — up from a previous estimate of 2.0% and meaning it was now seen holding above the central bank’s 2% target well into next year. Inflation in the 20 countries that share the euro has fallen to 2.6% from more than 10% in late 2022, largely thanks to lower fuel costs and an easing of post-pandemic supply snags. But that progress has stalled recently and what had looked like the start of a major ECB easing cycle only a few weeks ago now appears more uncertain due to KUALA LUMPUR (June 6): Malaysia Building Society Bhd (KL:MBSB) aims to increase its share of cheap funds and release some high-cost deposits to boost profits at the country’s second-largest standalone Islamic bank by assets. Under the Flight26 plan, MBSB, the holding company of MBSB Bank Bhd, is seeking to raise the proportion of current-account-saving-account (CASA) to 20% from just 7% in 2023. CASA typically carries littleto-no interest, which is lower in cost of funds for banks than that of fixed deposits (FD). “Flight26is all about bringing CASA up, rebalancing the FD portfolio, and releasing some of the high-cost institutional deposits,” said group chief executive officer Rafe Haneef. “We are quite healthy in terms of growth in financing, and we need to make sure that growth is giving us the right profit margin.” Banks in Malaysia have been grappling with pressure on their net interest margin — a measure of profitability from interests charged on loans after deducting returns paid to depositors — amid intense competition for deposits in a market with three dozen foreign and local lenders. Lenders also have to maintain comfortable levels of deposits and other buffers to support loan growth in an econoBY FRANCESCO CANEPA & BALAZS KORANYI Reuters BY CHESTER TAY & LUQMAN AMIN theedgemalaysia.com signs that inflation may prove sticky, as has been the case in the US. Cutting its deposit rate to 3.75% from a record-high 4.0%, the ECB gave no indication as to whether that would be followed by a further easing in July. “We are not pre-comitting to a particular rate path,” ECB president Christine Lagarde told a press conference, reading from the Governing Council’s statement. “Despite the progress over recent quarters, domestic price pressures remain strong as wage growth is elevated, and inflation is likely to stay above target well into next year.” With Thursday’s move the ECB joins the central banks of Canada, Sweden and Switzerland in undoing some of the steepest streaks of interest rate hikes in recent history. Some ECB-watchers have questioned the logic of moving now, however, especially as the US Federal Reserve has been stopped in its tracks by some stronger-than-expected inflation readings and is not expected to move till after the summer. Read the full story Read the full story my expected to accelerate this year. While competitors are also eyeing to expand the CASA portion in their deposits, Rafe said MBSB is not looking to grab major market share from the industry that averages 33%. The company is also guiding for a net profit margin (NPM) of 2% for 2024 through 2026. “If we can get 2% NPM with a 7% CASA ratio, can you imagine how much NPM can be improved here,” Rafe told reporters after the MBSB’s annual general meeting. MBSB’s 7% CASA ratio was achieved without the bank actively competing for it, chief financial officer Shahnaz Farouque Jammal said at the same press conference. “We did not really look at, or have been deliberately and systematically going out to look for CASA,” Shahnaz said. “So now, if we really activate physically and deliberately search for CASA in various means, just getting that bump up to a below-industry-average percentage is not going to be a big issue.” The target is “within reach and very reasonable,” Shahnaz said, “but it has quite a powerful impact.” ZAHID IZZANI/ THE EDGE Rafe Haneef Read also: RAM Ratings sees limited upside ahead for Malaysian banks’ profitability

friday june 7, 2024 3 The E dge C E O m o rning brief home Malton Bhd 0 20 40 60 June 7, 2022 June 6, 2024 30 40 50 60 Vol (mil) Sen *50.5 sen 41.5 sen *As at market close on June 6, 2024. Source: Bloomberg WCT Holdings Bhd 0 50 100 150 200 250 June 4, 2019 June 6, 2024 0 0.75 1.50 Vol (mil) RM/sen *77.5 sen 89.7 sen *As at market close on June 6, 2024. Source: Bloomberg KUALA LUMPUR (June 6): Country View Bhd’s (KL:CVIEW) wholly owned subsidiary, Country View Resources Sdn Bhd, has entered into a sale and purchase agreement with Paragon View Sdn Bhd to dispose of three pieces of freehold commercial land in Pulai, Johor Bahru, for a total of RM47.26 million. In a filing with Bursa Malaysia on Thursday, Country View said the combined 3.66 hectares (9.04 acres) of land are located in Taman Nusa Sentral, Iskandar Puteri. Country View unit sells JB land for RM47.26 mil KUALA LUMPUR (June 6): Shares in WCT Holdings Bhd (KL:WCT) climbed to their highest in more than four years on Thursday. The stock surged 40% or 25 sen to 87.5 sen, the highest level since November 2019. The quantum leap in the share price is one of the biggest single-day gains. The price rally added RM255.1 million to WCT’s market capitalisation, which now stands at RM1.14 billion. WCT closed the day at 77.5 sen for a gain of 15 sen or 24%, with more than 231.22 million shares changing hands, making it the day’s most active stock on Bursa Malaysia. The stock has risen 55% since the beginning of this year and surged 84.52% in the past one year. WCT currently has four “buy” calls, four “hold” recommendations, while only one research house — TA Securities — has a “sell” rating. Meanwhile, the stock had surpassed its 12-month target price of 61 sen on Monday, Bloomberg’s data showed. Property tycoon Tan Sri Desmond Lim Siew Choon’s private vehicle Dominion Nexus Sdn Bhd holds the largest stake in the property company of 18.15%, followed by Lim himself with a 7.42% stake, and Amanah Saham Nasional Bhd with 5.82%. It was not known at press time what could have lifted WCT’s share price, which started climbing from 52.5 sen about two weeks ago on May 24. Meanwhile, property developer Malton Bhd (KL:MALTON), in which Lim is the chairman and controlling shareholder, also saw its shares surge to a two-year high on Thursday. Surge in buying interest in WCT and Malton by Anis Hazim theedgemalaysia.com Bernama Malton climbed 30.49% — its largest one-day gain over three years — to its upper limit of 55 sen. The counter closed at 50.5 sen, still up 23.17%. It saw 50.11 million shares exchange hands to finish among the top-20 active stocks on the exchange. At 50.5 sen, Malton is valued at RM263.46 million. The stock has gained 32.89% year-to-date and 20.24% in the past one year. Besides Malton, Lim is also the chairman and second largest shareholder of Pavilion Real Estate Investment Trust (KL:PAVREIT). Last Wednesday, WCT announced that it had returned to the black in its first quarter of 2024, after posting two consecutive quarters of losses, thanks to the improved results from its construction, property and property investment segments. Net profit for the three months ended March 31, 2024 (1QFY2024) was RM16.14 million, versus a net loss of RM7.69 million a year earlier. Revenue for the quarter rose 15.51% year-on-year to RM467.39 million, from RM404.65 million. No dividend was declared. The last time it paid a dividend of half a sen per share was in FY2022. The exercise will allow the group to unlock the land value, enhancing its liquidity position. The group noted that it will recognise an estimated net pro forma gain of RM18.14 million from the disposal. Country View said the disposal proceeds will fund ongoing and future development projects, as well as be used as working capital, to reduce bank borrowings and improve the group’s gearing. The exercise is also expected to strengthen the group’s principal business and benefit the group.

friday june 7, 2024 4 The E dge C E O m o rning brief home Malaysia’s automotive supply chain costs 30% more than China’s, says Geely chairman — report SHAH ALAM (June 6): Integrated logistics solutions provider Tasco Bhd (KL:TASCO) plans to invest an additional RM400 million from now to 2026 to expand its warehouse capacity. Executive chairman and substantial shareholder Lee Check Poh said the group has so far invested RM300 million in the expansion of its warehouses, exceeding the minimum RM240 million investment in capital expenditure (capex) to qualify for the income tax exemption under the Malaysian Investment Development Authority’s (Mida) integrated logistics services (ILS) scheme. “Mida has awarded us the ILS scheme twice. The first one was for a five-year period from 2003 to 2007. We invested RM90 million in the first round. The second one was for a five-year period from 2021 to 2026 of a minimum RM240 million investment, which we have already invested RM300 million, as of today,” he said at the launch of Tasco’s new four-storey warehouse under phase one of the Shah Alam Logistics Centre (SALC) on Thursday. The event, which was officiated by Selangor Menteri Besar Datuk Seri Amirudin Shari and Japanese Ambassador to Malaysia Katsuhiko Takahashi, was in conjunction with the group’s 50th anniversary this year. Tasco to invest additional RM400 mil to expand warehouse capacity over next two years by Kang Siew Li theedgemalaysia.com Tasco executive chairman Lee Check Poh (fourth from left), Selangor Menteri Besar Datuk Seri Amirudin Shari (fifth from left), Japanese Ambassador to Malaysia Katsuhiko Takahashi (third from right) and senior officials at the launch of Tasco's new warehouse on Thursday. (June 6): In an interview on state-owned CCTV programme Dialogue, which was picked up by Chinese tech website CNMO, Geely chairman Li Shufu said that the fundamental reason for the high cost of Malaysia’s automotive supply chain lies in the lack of competitiveness of local parts, Paultan reported. Li said the competitiveness of Malaysia’s automotive industry is being restricted by its automotive supply chain costs — about 30% higher than China’s and more than 10% higher than Thailand’s. He said that Malaysia’s automotive parts supply still relies heavily on overseas imports, and that the relatively small size of the local automotive market meant it was difficult to get enough scale to keep costs down, Paultan reported. theedgemalaysia.com “We still have two more years to go. From our investment strategy pipeline, we will most probably invest another RM400 million until 2026, bringing total capex to RM700 million under the second ILS scheme,” Lee said, adding that the warehouse expansion is expected to create 800 jobs this year alone. The newly built warehouse adds 600,000 sq ft to the 400,000 sq ft of warehousing space Tasco currently owns in the same premises. According to Lee, about 70% of Tasco’s newly launched four-storey SALC warehouse has been leased out to customers. He added that Tasco is currently in negotiations with a potential customer to take up the remaining space. Warehousing capacity at Shah Alam hub to grow to 1.4 million sq ft by 2026 Part of the RM400 million capex will be used for phase two of SALC, which will see another 400,000 sq ft of warehousing space added, bringing the total to 1.4 million sq ft by 2026. “The group’s old headquarters will be demolished and replaced with a four-storey warehouse, which will connect to today’s newly-launched warehouse and will use the same ramp,” said Lee. Tasco also plans to build two new warehouses in Northport, which will span 600,000 sq ft in total. Almost half of that facility will cater to cold storage warehousing with automated storage and retrieval systems (ASRS). Tasco’s 70%-owned subsidiary Tasco Yusen Gold Cold Sdn Bhd (TYGC) is currently the biggest cold chain player in Malaysia. In 2019, Japan Overseas Infrastructure Investment Corp for Transport and Urban Development (JOIN), a Japanese government investment company, had invested 30% in TYGC. Read the full story suhaimi yusuf/the edge Proton sales up 14% m-o-m to 12,522 units in May, Saga remains top exported model by Anis Hazim theedgemalaysia.com KUALA LUMPUR (June 6): Proton Holdings Bhd, in which DRB-Hicom Bhd (KL:DRBHCOM) owns a 50.1% stake, saw its vehicle sales rise 13.6% month-on-month (m-o-m) to 12,522 units in May, thanks to improved export market sales. Sales in the first five months of 2024 stood at 62,697 units, ranking the national carmaker at second place in overall national automotive sales, with a forecast market share of 19%, Proton said in a statement on Thursday. co ntinues on Page 6

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friday june 7, 2024 6 The E dge C E O m o rning brief home KUALA LUMPUR (June 6): Real estate developer Paramount Corp Bhd (KL:PARAMON) is aiming for 30% of its annual profit to stem from overseas property projects by 2030, supported by its recent acquisition of a 21.5% stake in Eco World International Bhd (EWI) (KL:EWINT), as domestic orders are expected to saturate. “We have grown five times over the last ten years and reached RM1 billion in sales. We are not going to grow five times more in Malaysia over the next ten years. So, we want to see a layer of non-Malaysian contribution coming in,” said Paramount chief executive officer Jeffrey Chew Sun Teong. Chew said Paramount’s only overseas property project is a 29-storey condominium in Bangkok, developed through a joint venture with a Thai developer in 2020, with revenue expected to be recognised over the next two financial years, contributing roughly 2% to the group’s profit. He said the company is gearing up for overseas expansion, with its stake acquisition in Eco World International Bhd (EWI) — which focuses on real estate development in the United Kingdom and Australia — expected to contribute roughly 20% of its profit. Chew also said Paramount will likely get “one or two” board seats, depending on EWI’s decision, after Paramount emerged as the second largest shareholder in the company last month. Furthermore, Chew said Paramount is looking to invest in offshore property projects that are of a smaller scale. “It could be industrial factories, commercial complexes or small residential projects. We plan to enter on a structured equity level for a short-term basis between one to five years so that we can get returns on a project basis,” he told reporters during a briefing after the group’s annual general meeting. “We are working with various partners across countries such as the US, the UK, Singapore, Japan and maybe one or two European countries. All are established markets,” he said. “We are putting our bets, 80% on developing markets, and 20% on established markets.” For the financial quarter ended March 31, 2024 (1QFY2024), net profit fell 33.44% to RM7.71 million from RM11.58 million a year earlier, as Paramount’s property segment was hit by lower work progress and sales. Revenue of its property segment declined 13% to RM161.8 million, from RM185.8 million in 1QFY2023. Chew attributed the decline to the delay in property launches, adding that the group shall see stronger performance in the coming quarter. For FY2023, Paramount’s revenue jumped 19.4% to RM1.01 billion from RM847.46 million, due to higher property sales. Net profit surged 37.6% to RM82.94 million from RM60.2 million, partly due to disposal gains of its education business investments. For the full year ending Dec 31, 2024 (FY2024), the group is targeting property launches amounting to RM2.4 billion and total sales amounting to RM1.4 billion. “We have seen the property demand increasing by 20% over the past two years, while the supply has declined by 25% as developers were careful with their positioning. We are very confident in achieving our target for the year,” Chew added. Meanwhile, EWI returned to the black in its first financial quarter ended Jan 31, 2024 (1QFY2024), with a net profit of RM182,000, compared to a RM30.82 million net loss in 1QFY2023. Revenue jumped 41.6% to RM31.67 million from RM22.37 million previously, driven by the sale of higher-priced commercial units. Jeffrey Chew Sun Teong. suhaimi yusuf/ the edge Paramount Corp eyes profit boost with EWI stake, targets 30% earnings from overseas projects by 2030 by Hee En Qi theedgemalaysia.com from Page 4 Proton sales growth in May is also in line with Malaysia’s total industry volume (TIV), which is estimated to have grown by 20.7% to about 70,000 units in May, and rose by 8.8% to 330,236 units year-to-date. “Proton’s plans to expand and re-establish its brand in countries such as Trinidad and Tobago, Bangladesh and Iraq this year have proven fruitful, as its export sales came in at 509 units in May, the highest shipment recorded in 2024 thus far,” Proton said. Since February this year, the bestselling export model is the Proton Saga, which again led the pack with 360 units exported in May. Meanwhile, other models recorded an uptick in May export sales, bringing cumulative export sales to 1,344 units since January this year. At home, Proton X90 was the most popular D-segment (medium-sized car) sport utility vehicle (SUV) in Malaysia, with 364 units sold in May, while sales of the C-segment sedan (compact car) Proton S70 increased 23% to 2,011 units. Sales of Proton Saga rose 21.6% to 6,119 units in May. Proton X70 saw 523 units sold, followed by B-segment (small car) sedan Proton Persona (1,645 units), hatchback Proton Iriz (452 units), as well as SUV Proton X50 (1,407 units). Proton also expects a surge in demand for the Proton X50, following the launch of the revamped 2024 model on Tuesday. Moving forward, the company will focus on boosting sales of existing car models, while prepping to enter the electronic vehicle (EV) market with new EV models soon. “With the cumulative TIV until May already making up 44.6% of the Malaysian Automotive Association’s full-year projection of 740,000 units, we believe there is still room for growth in the local automotive industry,” the carmaker said.

FRIDAY JUNE 7, 2024 7 THEEDGE CEO MORNING BRIEF HOME KUALA LUMPUR (June 6): Permodalan Nasional Bhd’s (PNB) 44.11%-owned associate Duopharma Biotech Bhd (KL:DPHARMA) is currently reviewing merger and acquisition (M&A) proposals for firms in Indonesia and the Philippines, as it bids to diversify revenue streams geographically in order to reduce a reliance on ringgit-denominated earnings, said managing director Leonard Ariff Abdul Shatar. Speaking at a press conference after the pharmaceutical company’s annual general meeting, Leonard Ariff said that the group is eyeing M&A activities within Asean at the moment for ease of control. “We are looking at candidates in the Philippines and Indonesia, we are evaluating [the proposals] at this stage,” said Leonard. As at end-March, the group’s cash balance stood at RM232.32 million, while total borrowings totalled RM528.3 million. The company raised RM364 million through the issuance of the first tranche of its RM2 billion Islamic bond programme in September last year. Leonard explained that Duopharma intends to increase the share of export to PNB-backed Duopharma evaluating M&A plans in Indonesia, the Philippines KUALA LUMPUR (June 6): Pharmaceutical company Duopharma Biotech Bhd (KL:DPHARMA) announced on Thursday that it is eyeing up to a 10% revenue contribution over the next two years from a recently-secured contract with Pharmaniaga Bhd (KL:PHARMA). In addition to the Approved Product Purchase List (APPL) contract with Pharmaniaga, the company is still awaiting confirmation on several other contracts that are currently under negotiation, managing director Leonard Ariff Abdul Shatar told reporters, following Duopharma’s annual general meeting. “APPL is not awarded at one point, as they determine the price in a competitive process,” Leonard Ariff said. “I expect the new APPL [contract] to contribute positively to the group’s [annual] revenue.” Duopharma secured the APPL contract, valued at RM578.09 million from Pharmaniaga in April, which involves supplying 86 pharmaceutical and non-pharmaceutical products. The contract is based on an exchange rate of RM4.70 against the US dollar, compared to the RM4.20-RM4.25 range in 2017, while the range of products is expected to surpass the current 50 stock-keeping units (SKUs), according to Leonard Ariff. He said that the APPL contract will enable the company to pass on the higher costs of active pharmaceutical ingredients to the government. When asked how this would affect the company’s profit margins, he explained that “some of the product prices are defiDuopharma aiming at 10% revenue boost from new contracts from Pharmaniaga in next two years BY SYAFIQAH SALIM theedgemalaysia.com BY SYAFIQAH SALIM theedgemalaysia.com total sales, noting that foreign currency-denominated sales act as a natural hedge against the procurement of raw materials priced in US dollars. “For this year, we expect at least 15% growth for exports in the Asean countries,” he said. Compared to 2023, the group’s export growth was around 7%, driven by the Singapore and Philippine market amid increase in sales driven by new tenders and growth in the private ethical channel. On its financial performance, Duopharma’s net profit for the first quarter ended March 31, 2024 (1QFY2024) dropped 32.5% to RM15.28 million from RM22.63 million a year earlier, amid lower demand for its prescription pharmaceutical products, higher costs as well as unfavourable exchange rates. Quarterly revenue fell 3.74% to RM192.97 million from RM200.48 million. nitely better, while others improve but do not fully cover the entire cost increase”. He also flagged that “some of our cost bases have risen and will not be decreasing”. Duopharma in aggressive bidding mode amid rising operational costs Prior to the latest contract, Duopharma had received multiple extensions for the APPL contract, secured from Pharmaniaga in 2017 to supply pharmaceutical and non-pharmaceutical products to government hospitals and clinics. The contract initially covered a threeyear period from Dec 1, 2017, to Nov 30, 2019, and was subsequently extended four times, ultimately lasting until Dec 31, 2023. Duopharma is getting “more aggressive” in bidding for several tenders, amid rising operational costs, said Leonard Ariff. “We need to be more aggressive,” he continued, “because we need the topline to offset the inflationary pressures we are facing”. Rising operational costs, which included increased electricity tariffs, higher finance costs, incremental expenses from the commencement of production at the new K3 facility, and unfavourable exchange rates, have weighed on Duopharma’s earnings last year, he noted. Duopharma’s net profit for the first quarter ended March 31, 2024 (1QFY2024) dropped by 32.5% year-onyear to RM15.28 million. The net profit margin for the quarter narrowed to 7.91%, compared to 11.3% in 1QFY2023. SHAHRILL BASRI/ THE EDGE Duopharma Biotech Bhd group managing director Leonard Ariff Abdul Shatar said the company is still awaiting confirmation on several other contracts that are currently under negotiation.

FRIDAY JUNE 7, 2024 8 THEEDGE CEO MORNING BRIEF HOME KUALA LUMPUR (June 6): Energy services firm Kinergy Advancement Bhd (KL:KAB) said on Thursday that it is acquiring an Indonesian company for RM8.89 million to build a 4.26-megawatt biogas plant in Aceh. KAB’s unit KAB Energy Holdings Sdn Bhd signed a term sheet with Green Energy Specialist Pte Ltd of Singapore to acquire the entire equity interest in PT Green Energy Specialist One Tbk (PT Geso), the company said in an exchange filing. The proposed acquisition includes exclusivity over a 6.5-hectare land where the plant will be built. KAB, formerly known as Kejuruteraan Asastera Bhd, said PT Geso has already secured a power purchase agreement with Indonesia’s state electricity company PT Perusahaan Listrik Negara Tbk, which will last for a duration of 25 years from the commercial operation date. The initiative follows KAB’s initial venture into Indonesia with a mini-hydroplant in North Sumatra as the company seeks a diversified energy portfolio generating a stream of recurring revenue. The proposed acquisition of PT Geso also includes exclusive agreement with four palm oil millers for their effluent, securing a consistent supply of raw materials essential for biogas production before the formal acquisition. Empty fruit bunches from oil palm trees is a byproduct waste from mills that is typically not utilised. “The acquisition of the Aceh biogas plant is a strategic move that aligns perfectly with our growth plan in the realm of sustainable energy,” KAB executive deputy chairman cum group managing director Datuk Lai Keng Onn said in a separate statement. Indonesia, as the world’s largest producer of palm oil, “presents a compelling choice for this development, with abundant feedstock available for biogas production,” he noted. Upon completion by the first quarter of 2025, Lai said the Aceh biogas plant will be another recurring revenue generator for KAB. Kinergy Advancement acquires Indonesian firm for RM8.89 mil to build biogas plant in Aceh KUALA LUMPUR (June 6): Jati Tinggi Group Bhd (KL:JTGROUP) announced on Thursday that its 30% joint venture (JV) company has secured a RM25.55 million contract from Tenaga Nasional Bhd (KL:TENAGA) to install a 132kV underground double circuit cable for a semiconductor factory in Kuala Lumpur. The contract period is for a year from May 31, said Jati Tinggi, which provides engineering services and solutions for underground and overhead utilities. According to the group’s bourse filing, the 70:30 JV between Worktime Engineering Sdn Bhd (WESB) and Jati Tinggi’s wholly-owned unit Jati Tinggi Holding KUALA LUMPUR (June 6): Midports Holdings Sdn Bhd, a 79%-owned subsidiary of property developer Tanco Holdings Bhd (KL:TANCO), has entered into a memorandum of understanding (MOU) with China’s CCCC Dredging (Group) Co Ltd to develop Malaysia’s first smart artificial intelligence (AI) container port in Port Dickson, Negeri Sembilan. In a bourse filing on Thursday, Tanco said the MOU aims to facilitate communication and information exchange to advance the proposed project to the implementation stage. The group added that both parties will enter into a separate agreement at the implementation stage to clarify their respective rights and responsibilities. Each party will bear its own costs incurred during the MOU’s performance, with third-party service costs being negotiated separately. China’s CCCC Dredging (Group) Co Ltd, established in May 2015 in Shanghai and currently listed in Hong Kong and Shanghai, is one of the largest dredging companies in the world. It has set up a wholly-owned subsidiary, CCCC Dredging Southeast Asia Sdn Bhd, in Malaysia. In a separate statement on Thursday, Tanco said Midports has obtained approval in principle from the Ministry of Transport Malaysia to develop the port in Port Dickson, named Smart AI Container Port. This project aims to boost the local economy and enhance international trade, supporting Malaysia’s goal of becoming a modern port hub. The MOU follows the joint venture agreement between Midports and Menteri Besar Negeri Sembilan (Perbadanan) announced on February 27 for the reclamation works necessary for the project. Sdn Bhd (JTHSB) must submit a performance security for the project within 56 days from May 31. The contract is expected to contribute positively to Jati Tinggi’s future earnings, earnings per share and net assets per share over the duration of the contract, the group said. For the first quarter ended Feb 29, 2024 (1QFY2024), Jati Tinggi reported a net profit of RM7.24 million on revenue of RM29.01 million. Earnings for the quarter were driven by several key projects: installation of 132kV underground cables from Bayan Mutiara-Gelugor to The Light in Penang, double circuit underground cable works from Tun Razak Exchange to Cochrane substation, installation of 132kV underground and fibre optic cables from Batu Berendam to Texas Instrument Electronics in Melaka, and installation, testing, and commissioning of 33kV underground cables from Keteri South to Chuping Valley Industrial Area in Perlis. Jati Tinggi, which made its debut on the ACE Market of Bursa Malaysia last December, closed up 1.5 sen or 4.41% at 35.5 sen on Thursday. This gives the group a market capitalisation of RM139.09 million. The counter has gained over 31% against its initial public offer price of 27 sen. Jati Tinggi JV company bags RM26 mil contract from TNB Tanco unit inks MOU with China’s CCCC Dredging on AI container port in Port Dickson BY SYAFIQAH SALIM theedgemalaysia.com BY CHOY NYEN YIAU theedgemalaysia.com BY EMIR ZAINUL theedgemalaysia.com

FRIDAY JUNE 7, 2024 9 THEEDGE CEO MORNING BRIEF

FRIDAY JUNE 7, 2024 10 THEEDGE CEO MORNING BRIEF HOME KUALA LUMPUR (June 6): PublicInvest Research upgraded the rubber glove sector to ‘neutral’, from ‘underweight’ previously, and said all three glove players under its coverage — Top Glove Corp Bhd (KL:TOPGLOV), Hartalega Holdings Bhd (KL:HARTA) and Kossan Rubber Industries Bhd (KL:KOSSAN) — had posted a stronger set of results for the latest quarter. In a note on Thursday, the research house said the glove industry is entering a recovery phase, with an uptick in demand, as customers replenish their inventories. Additionally, with the US imposing higher tariff rates on China’s surgical and medical gloves — from 7.5% to 25% — from 2026, PublicInvest expects diversion of orders from China to Malaysia. It expects this development to narrow the pricing gap between Malaysian and Chinese glove players, enhancing the competitiveness of local players and enabling them to regain market share. Thus, PublicInvest upgraded its calls on Hartalega, Top Glove and Kossan from ‘underperform’ to ‘neutral’, with higher price-to-book multiples and target prices. “We are now ‘neutral’ on the glove sector, as we generally believe that the earnings growth potential has largely been captured in current valuations,” the research house said. Read also: Hartalega discloses carbon footprint of glove products PublicInvest upgrades glove sector to ‘neutral’, says industry in recovery phase PETALING JAYA (June 6): The Ministry of Plantation and Commodities is cautiously optimistic that Malaysia will be able to achieve double digit growth in rubber gloves export revenue this year. Deputy Plantation and Commodities Minister Datuk Chan Foong Hin said that last year, Malaysia exported over RM11 billion worth of rubber gloves, which accounts for 58% of the nation’s total export of rubber products. “Malaysia is also the global leader in the rubber gloves industry. Post-Covid era, we’ve seen an about 12%-15% growth in demand every year,” he told reporters after the soft launch of the 11th International Rubber Glove Conference and Exhibition (IRGCE) here on Thursday. Malaysia recorded RM3.3 billion rubber gloves export revenue in the first quarter of 2024. Meanwhile, Malaysia Rubber Glove Manufacturers Association (Margma) president Oon Kim Hung said the industry has shown exceptional resilience and flexibility in the face of challenging global circumstances. “Despite the downturn in 2023, where global demand for rubber gloves dropped significantly due to overstocking and the collapse of the average selling price, our players in Malaysia remained steadfast in their businesses and continued to move our industry forward,” he said. On another development, Oon said Margma is currently exploring the establishment of industry standards for Malaysian-manufactured rubber gloves and implementing the ‘Malaysia Sustainable Natural Rubber’ initiatives, including ‘Green Gloves’ and other ecofriendly options. He said these endeavors highlight its dedication to sustainable practices and the presMalaysia can achieve double-digit growth in rubber gloves export in 2024 — deputy minister ervation of the environment. “Collaborating closely with stakeholders and utilising technologies such as Internet of Things and artificial intelligence (AI) can improve supply chain efficiency, streamline operations, and enhance decision-making, leading to increased global competitiveness and effective management of upcoming challenges” he said. Themed “Towards an Effective, Sustainable and Innovative Rubber Glove Industry”, the 11th IRGCE is scheduled to take place in Kuala Lumpur from Sept 3-5, 2024. Among other things, the event will feature technical papers and keynote presentations by international and local experts on topics such as environmental and biodegradability standards for disposable rubber gloves, as well as practical approaches to adopting Industry 4.0 technologies for sustainable manufacturing. The experts will also discuss preparations for the European Union’s new deforestation regulations, leveraging digital technologies for a sustainable supply chain, and environmental, sustainability and governance (ESG) principles to ensure ethical and responsible business practices. Currently, 550 booths have been reserved by 171 exhibitors from 17 countries. “We are anticipating the largest participation yet this year, with representatives from over 30 countries and an estimated 12,000 participants. “The Ministry of Plantation and Commodities, together with other stakeholders, namely the Ministry of International Trade and Industry, Malaysian Rubber Board and Malaysia External Trade Development Corporation (Matrade) is proud to support this event,” he added. Bernama BY SURIN MURUGIAH theedgemalaysia.com

FRIDAY JUNE 7, 2024 11 THEEDGE CEO MORNING BRIEF HOME NEWS IN BRIEF TAFI Industries unit disposes of Muar property for RM12 mil KUALA LUMPUR (June 3): TAFI Industries Bhd’s (KL:TAFI) wholly-owned unit, TA Furniture & Projects Sdn Bhd (TAFPSB) is disposing of one of its industrial premises comprising a factory annexed with a storey office in Muar, Johor for RM12 million. In a statement, TAFI said its TAFPSB has entered into a sale and purchase agreement with Comfy Factor Sdn Bhd & NNST Capital Sdn Bhd for the disposal, which will realise a gain after Real Property Gains Tax (RPGT) of some RM8.1 million, based on the net book value of RM3.1 million as at March 31, 2024. The single storey detached factory was primarily used for furniture manufacturing. TAFI Group had decided to dispose of the said property, which was primarily used for furniture manufacturing, as it plans to achieve cost-efficiency by sub-contracting out certain manufacturing processes. — by Isabelle Francis Malaysia aims to showcase at least 40 5G private network use cases, says Gobind PUTRAJAYA (June 6): Malaysia plans to present at least 40 fifth-generation (5G) private network use cases in sectors such as manufacturing, oil and gas, logistics, healthcare, and plantations, ahead of its Asean chairmanship in 2025. Digital Minister Gobind Singh Deo highlighted Malaysia’s rapid 5G network roll-out, achieving over 80% coverage of populated areas within two years of launching 5G services. “This ongoing effort to accelerate 5G adoption among various enterprises is crucial for Malaysia’s digital transformation. It positions Malaysia as a 5G leader ahead of our Asean chairmanship in 2025, and strengthens our hold on digitalrelated investments and benefits in the region,” he said in a statement on Thursday. He noted that Malaysia’s 5G network had received numerous awards and recognitions from global internet analytics firms, such as OOKLA, Opensignal, and Glotel. By the end of April, Malaysia had over 13 million 5G subscribers, equating to a 40% penetration rate. “While consumers will benefit from faster speeds and improved mobile experiences through 5G, the technology’s adoption by enterprises will be transformative. It will revolutionise business operations, collaboration, and innovation,” he said. — Bernama Rafizi: Govt to review policies related to O&G service and equipment industry KUALA LUMPUR (June 6): The government will review policies related to the oil and gas service and equipment (OGSE) industry, said Minister of Economy Rafizi Ramli. He said the review is to enable the sector to be more global, sustainable, agile and divergent because the global trajectory of the OGSE industry is much more positive now, compared to six years ago. “I think there is a realisation in the world, not just in Malaysia, that we are looking at the phase down and not an abrupt phasing out of fossil fuel. “Therefore, crude oil and gas are going to be there,” he said after the launch of the OGSE Census 2024 here on Thursday. — Bernama Penang domestic water consumers to enjoy discounts in 2H2024 KUALA LUMPUR (June 6): Perbadanan Bekalan Air Pulau Pinang Sdn Bhd (PBAPP) will not bill Penang domestic consumers for the first 10m3 (10,000 litres) in each bi-monthly domestic water bill from July 1 to Dec 31, 2024, as per the directive from the Penang State Executive Council. In a statement to the local bourse on Thursday, PBA Holdings Bhd (KL:PBA) said domestic water usage in Penang is billed on a bi-monthly basis. It said Penang domestic water consumers who use more than 10m3 in two months will save RM6.20 per bill. Total savings for each domestic water consumer will be RM18.60 over the six-month period, PBAPP said. The water company said that as at May, there were about 597,000 registered domestic water consumers in Penang. The projected impact on PBAPP’s revenue is about RM11 million, said the company. PBAPP said the temporary measure is only applicable to domestic water consumption in Penang during the specified period. It does not apply to the following four categories of water consumption: — by Surin Murugiah • Non-domestic; • Domestic bulk meter; • Shipping; and •Houses of worship and welfare institutions. Nestcon bags RM37.7 mil construction job in Selangor KUALA LUMPUR (June 6): Nestcon Bhd (KL:NESTCON) has secured a RM37.7 million contract for construction works on a development project in Kota Seri Langat in Banting, Selangor. In a bourse filing on Thursday, the construction outfit stated that its wholly-owned subsidiary, Nestcon Infra Sdn Bhd, has accepted a letter of award (LOA) from property developer Seriemas Development Sdn Bhd to undertake the construction and completion of earthworks, soil improvement, and associated works for package 4-2 of the proposed development. The work is set to commence on June 11 and is expected to be completed within ten months, by April 10, 2025, Nestcon said, adding that the defect liability period will be 12 months from the date of the certificate of practical completion of the contract works. “The board is of the opinion that the LOA and the contract works are within the ordinary course of business of the company and the acceptance of the LOA is in the best interest of the company,” it said. Nestcon’s shares closed half a sen or 1.25% higher at 40.5 sen on Thursday, translating to a market value of RM286.82 million. — by Choy Nyen Yiau Read the full story ZAHID IZZANI/THE EDGE Aurelius fixes issue price for private placement at RM3.35 per share KUALA LUMPUR (June 6): Aurelius Technologies Bhd (KL:ATECH) has fixed the issue price at RM3.35 per share for its proposed private placement plan of up to 39.41 million shares. In a bourse filing on Thursday, the company said the placement is expected to raise gross proceeds of approximately RM132.01 million. The company in May had said the placement was expected to raise RM123.34 million based on an illustrative issue price of RM3.13 per share. The electronics manufacturing service provider said the proceeds are mainly to build a new manufacturing plant in the Kulim Hi-Tech Park in Kedah. — by Surin Murugiah SAM FONG/THE EDGE

FRIDAY JUNE 7, 2024 12 THEEDGE CEO MORNING BRIEF HOME Armizan: RON95 smuggling on the up after announcement of targeted diesel subsidy Govt approves over 30,000 Budi Madani cash aid applications, RM200 to be credited on June 10 Govt has set date for rationalisation of diesel subsidies, says Rafizi BY ANIS HAZIM theedgemalaysia.com Bernama Bernama KUALA LUMPUR (June 6): The Ministry of Finance (MOF) has approved more than 30,000 applications, including those from farmers and small commodity planters in Peninsular Malaysia, for the Budi Madani cash subsidy assistance. The first cash assistance of RM200 will be credited to the recipients’ respective bank accounts on June 10, according to a statement on Thursday. Meanwhile, recipients without bank accounts can claim the cash assistance by presenting their MyKad at any Bank Simpanan Nasional (BSN) branches across the peninsula. Eligible applicants can still register to receive Budi Madani this month. Applications made in June will qualify for payment in the same month and the following months, while applications after June will only qualify for payment starting from July. Budi Madani is a subsidy programme targeting eligible groups. It is divided into individual assistance (Budi Individu), assistance for farmers and small commodity planters (Budi Agri-Komoditi), and companies and public transport vehicles (MySubsidi Diesel). An estimated 300,000 owners of private diesel vehicles in the peninsula are eligible to receive Budi Individu. Meanwhile, 68,000 farmers, 8,000 livestock breeders, and 34,000 small-scale aquaculture entrepreneurs are qualified to benefit from Budi Agri-Komoditi, the MOF said. Rejected applicants can appeal Rejected individual applicants are advised to check their application status, and file appeals on the Budi Madani website at https://budimadani.gov.my. Farmers and small commodity planters who have yet to register with agencies under the relevant ministry are advised to do so before submitting their Budi Madani applications. “Based on current application data, the majority of applicants who were not approved did not meet the specified eligibility criteria. For example, there were applicants among farmers and small commodity growers who were not registered with the relevant ministry,” the MOF noted. Read also: Anwar wants digital banks to boost e-payment transactions TUMPAT (June 6): Cases of smuggling RON95 petrol are on the increase after the government announced the targeted subsidy for diesel, said Domestic Trade and Cost of Living Minister DaKUALA LUMPUR (June 6): The government has decided and set a date for the rationalisation of diesel subsidies, said Economy Minister Mohd Rafizi Ramli. He said the announcement will be made at the appropriate time. “It’s just that the sequencing has to be correct, and it is about balancing and reducing the risk of knock-on inflation. We have figured it out,” he told the media after the launch of the Oil and Gas Services and Equipment (OSGE) Census 2024 here on Thursday. He emphasised that the government will have to make sure there’s no unnecessary knock-on effects on inflation. “Another reason is over the supply, because sometimes if it is an early plan, users will ‘stock up’ early, because they know the price will go up in two or three months. “If we do diesel subsidy retargeting for the purpose of managing hoarding and smuggling, announcing the date will contribute towards a spike in smuggling,” he said. He also noted that it is impossible for stricter enforcement, as there are only about 2,500 enforcement officers. The Ministry of Finance has announced that individual private diesel vehicle owners could submit applications under the individual category, while small-scale farmers and smallholders could submit applications under the agri-commodity category of the Budi Madani subsidy assistance. Eligible recipients will receive Budi Madani assistance of RM200 per month, in line with the implementation of targeted diesel subsidies. ZAHID IZZANI/THE EDGE tuk Armizan Mohd Ali. He said as a result of this, smugglers of fuel have changed their strategy in their illegal activity. “There is information that they are changing their strategy, and is the result of monitoring carried out by enforcement officers stationed at the eight main entry points in Kelantan, Perak, Kedah and Perlis. “At the same time, my ministry has found that the modus operandi of smugglers is that they make repeated purchases of fuel at petrol stations around the bordering states,” he said. Armizan said this in a special press conference after patrolling the Malaysia-Thailand border at Sungai Golok, Pengkalan Kubor, here on Thursday. Read the full story

FRIDAY JUNE 7, 2024 13 THEEDGE CEO MORNING BRIEF READY FOR THE BIG LEAP in collaboration with Johor is the birth place of many entrepreneurs — from the past and current generations — who have spotted the economic opportunities in the state, thanks to its rich natural resources and strategic location. PHOTO BY DAVID ST LOH To read more, get a copy of The Edge—Johor Special Edition that comes together with The Edge Malaysia WEEK OF JUNE 10 Click to subscribe

FRIDAY JUNE 7, 2024 14 THEEDGE CEO MORNING BRIEF HOME Former aide’s suit, Anwar’s counterclaim fixed for hearing in June next year Sungai Bakap by-election on July 6, nomination on June 22 — EC Bernama BY HAFIZ YATIM theedgemalaysia.com PUTRAJAYA (June 6): The Election Commission (EC) has set July 6, a Saturday, as the polling day for the Sungai Bakap state by-election in Penang. EC deputy chairman Dr Azmi Sharom also announced nomination on June 22, a Saturday, and early voting on July 2, a Tuesday. Azmi announced this after chairing the EC’s special meeting at Menara SPR. The Sungai Bakap state seat fell vacant following the death of incumbent Nor Zamri Latiff on May 24 at the intensive care unit of the Seberang Jaya Hospital. The 56-year-old assemblyman was admitted to the hospital due to an inflammation of the stomach. The Sungai Bakap by-election will be the eighth by-election after the 15th general election in November 2022. Azmi said that the electoral roll to be used for the by-election is updated (as of May 24). “The electoral roll for Sungai Bakap contains 39,279 voters, consisting of 39,222 regular voters and 57 police officers,” he said. He added that the by-election would cost RM2.1 million, with 522 election workers to be appointed. The by-election will have nine regular polling centres with 65 polling channels, and one early voting centre and channel. The Jawi Multipurpose Hall in Taman Desa Jawi will be used as the nomination process and official vote tallying centre. Azmi said there will be a 14-day campaign period, starting from the declaration of candidates after nomination on June 22 until 11.59pm on July 5. “Two enforcement teams have been set up to monitor campaign activities throughout the campaign period,” he said, adding that the teams comprise police personnel, as well as representatives of local authorities and contesting candidates. According to Azmi, the application process for all categories of postal votes, both domestic and overseas, for the by-election is now open online. The closing date for applications is June 20 for Category 1A (election staff, EC members/officers, police, military, and media personnel), followed by June 13 for Category 1B (Malaysian citizens residing abroad) and Category 1C (agencies/organisations). Read the full story KUALA LUMPUR (June 6): The High Court on Thursday has fixed seven days from June 16, 2025, as the hearing date for a suit by Muhammed Yusoff Rawther, who was Datuk Seri Anwar Ibrahim’s former aide, against the prime minister for purported sexual assault. The date is fixed by Judge Dr John Lee Kien How @ Mohd Johan Lee where the date was informed to Anwar and Yusoff’s legal representatives via email on Thursday. Anwar’s counsel Navpreet Singh said the court has fixed June 16 to 19, and 23 to 25, next year as the hearing date and also the hearing of Anwar’s counterclaim. “There was no case management on Thursday but parties were informed via email from the High Court senior assistant registrar. “At present, both parties are at the pre-trial stage, to prepare documentation,” Navpreet added. Muhammed Yusoff filed the suit in July 2021 alleging the purported incident took place on Oct 2, 2018 at Anwar’s residence in Bukit Segambut, Kuala Lumpur. He claimed that following the incident he lodged a police report on the matter. However, he was accused of plotting to bring Anwar down and damage the Parti Keadilan Rakyat (PKR) president’s political career. The alleged sexual assault and the accusation have allegedly affected his (Muhammed Yusoff’s) mental health. Following this, he is seeking special, general, aggravated and exemplary damages from Anwar, along with interests, costs and other relief deemed fit by the court. Anwar, meanwhile, has denied the claim and filed a countersuit. Last May 7, judge Mohd Johan had dismissed Muhammad Yusoff’s application to obtain his polygraph report from the police in a bid to support his claim. In rejecting the former aide’s application, the judge said Muhammd Yusoff had not clearly elaborated on why it was relevant and is needed in the disposal of his civil case. “A mere statement that it is relevant or necessary is insufficient [...] The application is unnecessary and will not assist in the fair disposal of the trial. It is also part of the investigation paper and thus a privileged document,” Mohd Johan said. Mohd Johan also noted that a polygraph test report is not deemed to be reliable “in most, if not all” jurisdictions. Therefore, allowing the application would “only create more uncertainty” instead of assisting the court. “I have to agree with the third parties that if this practice is allowed now, it would open the floodgates and become a trend by claimants out there to use the help of the police force to establish their private action in the civil courts. This must not be condoned,” he said. Muhammed Yusoff Rawther filed the suit against Datuk Seri Anwar Ibrahim in July 2021 alleging that the purported sexual assault took place on Oct 2, 2018 at Anwar’s residence in Bukit Segambut, Kuala Lumpur. BERNAMA

FRIDAY JUNE 7, 2024 15 THEEDGE CEO MORNING BRIEF HOME KUALA LUMPUR (June 6): Former SRC International Sdn Bhd’s chairman Tan Sri Ismee Ismail was angry with the company’s former chief executive officer, Nik Faisal Ariff Kamil, over SRC’s failure to submit its accounts for the financial year 2013, the High Court heard on Thursday. Referring to an article by The Edge regarding the issue, Ismee said that he had “scolded” and “shouted” at Nik Faisal because he was under the impression that management had filed the accounts. “I called him and told him, ‘Nik Faisal, you’d better write a nasty [reply] to The Edge. Because I recall signing the board’s resolution to approve the accounts. Then he called me back and said we have not actually filed,” Ismee said. The article he was referring to was a May 2014 article entitled ‘SRC yet to file accounts or seek extension’ by Jose Barrock, which stated that the company had failed to submit its accounts for the 2013 financial year ended March 31, 2014. According to the report, the accounts were supposed to be submitted to the Companies Commission of Malaysia (CCM) by October 2013. Ismee went on to add that he took it upon himself to resolve the issue and worked on closing the accounts over the next 2-3 weeks. He said he left the company shortly after as he was frustrated. “I was the chairman of the company, but for a good two to three weeks I had to be an account executive,” he said. Previously, Ismee testified that he was appointed to the position on Aug 1, 2011, and resigned on Aug 15, 2014, due to corporate governance issues, especially with regards to the company’s accounts and its finances as managed by Nik Faisal. “’The proof of the pudding is in the eating’. In this case, once the accounts are closed, it gives me comfort that everything [is ok],” he said, adding that there had been no suspicion that anything was amiss (that the funds were not being used for the benefit of the country). “I was there in 2011 [until] 2013. We (the board) believed that there was communication [between Nik Faisal and Najib] and we didn’t expect Nik Faisal to be a liar,” he said, adding that the board did believe that the investments were for the benefit of the country at the material time. Ismee is testifying in the on-going SRC civil action against former prime minister Datuk Seri Najib Razak and Nik Faisal. The court had previously delivered a judgement in default against Nik Faisal, who is currently at large. Read the full story Ismee got mad at Nik Faisal on discovering, through The Edge’s article, that SRC had failed to submit accounts for FY2013 KUALA LUMPUR (June 6): Fugitive Low Taek Jho, better known as Jho Low, who has been on the run due to the controversial 1Malaysia Development Bhd (1MDB) scandal for years, has failed in his effort to appeal against the Cyprus government’s decision to revoke his Cypriot citizenship and passport, according to local newspaper Cyprus Mail. Citing a government source, Cyprus Mail reported that the independent committee dismissed Low’s appeal on May 17. And that had led to the interior minister to present the matter at Wednesday’s cabinet session, which subsequently resulted in the revocation order. The Cyprus cabinet decided to revoke Low’s Cypriot citizenship and passport last year. The independent committee was formed to re-examine the case after Low filed an appeal, according to the Cyprus Mail. To recap, Low was granted Cypriot citizenship in 2015 through the island’s citizenship-by-investment programme, also known as the “golden passport” scheme. Despite being flagged as high-risk, local mediators filed an application on his behalf and in June of that year, Low transferred close to €6 million (RM30.7 million) into an account at the Bank of Cyprus. Cyprus cabinet revokes Jho Low’s citizenship and passport — report Low reportedly purchased a seaside mansion in Ayia Napa for €5 million and obtained citizenship within a couple of days. Furthermore, Low donated around €310,000 to the late ex-Archbishop Chrysostomos, who advocated on his behalf to the interior ministry. Low is said to be the architect behind the 1MDB scandal, and was described by the late senior deputy public prosecutor and former Federal Court judge Datuk Seri Gopal Sri Ram as former prime minister Datuk Seri Najib Razak’s alter ego. He is one of the individuals who remain on the run. Low was one of the first among them to leave the country and has not returned to Malaysia since. The others are Casey Tang Keng Chee, former director of 1MDB; Terence Geh Choh Heng, then 1MDB director of finance; and Eric Tan Kim Loong. Read the full story Read also: Prosecution tells court to strike out Sarawak Report editor’s prison appeal BY CHOY NYEN YIAU theedgemalaysia.com BY TARANI PALANI theedgemalaysia.com Thanks to this article by The Edge, then SRC chairman Tan Sri Ismee Ismail found out that SRC had failed to submit accounts for FY2013. corporate 18 THEEDGE M A L AYSI A | MAY 5, 2014 SRC yet to fi le accounts or seek extension BY JOSE BARROCK S RC International Sdn Bhd, a wholly-owned unit of the Ministry of Finance Inc that had taken a RM4 billion government-guaranteed loan from Kumpulan Wang Persaraan (Diperbadankan) or KWAP, has failed to submit its accounts for the financial year 2013 ended March 31, which was due in September last year. Few may know that SRC was previously wholly owned by 1Malaysia Development Bhd (1MDB), but the company was transferred to its shareholder, the minister of finance, in a dividend in specie payment of one million SRC shares in mid-February 2012. SRC’s accounts for FY2013 should have been lodged with the Companies Commission of Malaysia (CCM) by October last year. The CCM, in an emailed reply to questions from The Edge, says, “As far as CCM is concerned, we have received the annual return and financial statement from SRC International for 2012. “They have yet to submit their annual return and financial statement for 2013, [and] neither did they seek an extension. For late submission of annual return and financial statement, there will be a compound, depending on their document date and date of annual meeting held.” It is not known why the company has difficulty in submitting its financial accounts. 1MDB has said its acquisition of assets and change in business direction had led to the delay in fi ling its accounts, which is viewed by many as a weak excuse. In the case of SRC, it does not even seem to have that fl imsy reason.      According to the company’s filings with the CCM for FY2012, it says it is principally involved in projects associated with the exploration, extraction, processing, logistics and trading of conventional and renewable energy resources, natural resources and minerals, including all other activities related thereto, any partnerships, joint ventures or arrangements for sharing profit, union of interest or cooperation and property holding.   For FY2012, SRC did not have any revenue, but had other income of RM37.3 million, and incurred an after-tax loss of RM29.1 million due to finance costs of RM56.2 million. It also had negative reserves of RM78.5 million. Its FY2012 accounts stated that the company had obtained a RM4 billion Islamic term financing from KWAP, “guaranteed by the government of Malaysia and bears a profit rate of 4.65% per annum for the first three years and a profit rate equivalent to 10 years Malaysian government securities’ profit rate plus 70 basis points for the remaining tenure of the financing, which is currently at 4.35%”. The accounts also revealed that this financing facility was drawn down in two tranches of RM2 billion each in August 2011 and March 2012. The first profit repayment shall be on the 30th month of 120 months and the principal repayment shall take effect on the 72nd month onwards. However, SRC was already in a net liability position as stated in its 2012 accounts, with its total liabilities exceeding total assets by RM77.5 million. As at March 31, 2012, SRC had short-term deposits with licensed banks of RM1.7 billion cash and bank balances of RM51.7 million. Interestingly, it had placed RM2 billion in a unit trust investment managed by AmInvestment Services Bhd, which had a yearend dividend income of RM231,479 in FY2012. Why it had placed money in a unit trust that yielded returns of not even 1% is anyone’s guess. According to its FY2012 accounts, the company’s directors are Datuk Che Abdullah @ Rashidi Che Omar, who is an executive director at Tadmax Resources Bhd (formerly known as Wijaya Baru Global Bhd), which is a politically well connected company, and Datuk Suboh Md Yassin, who was an assistant director in the Prime Minister’s Department from 1974 to 1977. Another director is Datuk Ismee Ismail, who is the managing director and CEO of Lembaga Tabung Haji. SRC’smanagingdirectorisNikFaisalAriffFLASHBACK: The Edge Malaysia May 5, 2014

FRIDAY JUNE 7, 2024 16 THEEDGE CEO MORNING BRIEF WORLD (June 6): The number of Americans filing new claims for unemployment benefits increased last week and unit labour costs rose by less than previously thought in the first quarter, indicating the labour market is cooling but not enough to allay the Federal Reserve’s hesitance to begin cutting interest rates. Initial claims for state unemployment benefits rose 8,000 to a seasonally adjusted 229,000 for the week ended June 1, the Labor Department said on Thursday. Economists polled by Reuters had forecast 220,000 claims in the latest week. The labour market has been steadily rebalancing back toward pre-pandemic levels after the Fed raised interest rates by roughly 525 basis points since March 2022 to slow demand in the overall economy. The so-called continuing claims tracking those who collect benefits beyond the first week increased 2,000 to a seasonally adjusted 1.792 million during the week ending May 25. “The level (of weekly jobless claims) remains in a range that suggests the labour market remains tight,” said Thomas Simons, US economist at Jefferies. “Continuing claims are still very low by any historical standard, and we still see the data as supporting the notion that people who lose a job are able to find a new one with relative ease.” Data earlier this week showed US job openings in April fell more than expected and the number of available jobs per job-seeker reached its lowest level since June 2021. Earlier on Thursday, US employers announced the fewest job cuts last month since December and layoff announcements so far in 2024 are running behind last year’s pace, according to data from outplacement firm Challenger, Gray and Christmas. Employers announced 63,816 cuts in May, a 1.5% decrease from the 64,789 cuts announced in April and down about 20% from the 80,089 cuts announced a year earlier. Year-to-date layoff announcements are 7.6% lower than in the first five months of 2023. Productivity, labour costs revised lower US worker productivity grew slightly less than previously estimated in the first quarter but exceeded market expectations, and unit labour costs rose by less than first thought, data from the Labor Department also showed on Thursday. Non-farm productivity, which measures hourly output per worker, increased at a 0.2% annualised rate in the first quarter, revised down from an initial estimate of 0.3% one month ago. Economists polled by Reuters had estimated a revision down to 0.1%. Unit labour costs rose at a 4.0% annualised rate, down from the first estimate of 4.7%. Economists had projected labour costs to be revised up to 4.9%. Productivity accelerated and labour costs were subdued through much of 2023, ending at 3.5% and unchanged, respectively, in the fourth quarter. At the time, that had been seen as one of the arguments favouring Fed rate cuts in 2024 as it was hoped improved worker efficiency would dampen inflation. US weekly jobless claims rise, 1Q labour costs revised lower (June 6): The US trade deficit widened in April to the largest since October 2022 on a surge in imports of goods including motor vehicles, computers and industrial supplies. The gap in goods and services trade grew 8.7% from the prior month to US$74.6 billion (RM350.5 billion), Commerce Department data showed Thursday. The median estimate in a Bloomberg survey of economists called for a US$76.5 billion gap. The value of imports rose 2.4% to the highest since mid-2022, while exports edged up 0.8%. The figures aren’t adjusted for inflation. The April deficit suggests trade will again be a constraint on economic growth after subtracting from gross domestic product in the first quarter for the first time since early 2022. Prior to the latest results, the Federal Reserve Bank of Atlanta’s GDPNow forecast showed trade subtracting about a half a percentage point in the second quarter. While the US trade balance has improved since 2022, the appetite for imported merchandise may stay elevated given resilient consumer spending. Moreover, softer overseas economies are restraining demand for US exports. On an inflation-adjusted basis, the merchandise trade deficit widened to US$93.5 billion in April, the largest in a year. The trade report included annual revisions back to 2019. US trade gap widens to US$74.6 bil, largest since October 2022 BY MARK NIQUETTE Bloomberg BY LINDSAY DUNSMUIR & DAN BURN Reuters REUTERS BLOOMBERG

FRIDAY JUNE 7, 2024 17 THEEDGE CEO MORNING BRIEF WORLD (June 6): Indian stocks are headed for second day of gains on Thursday, as Indian Prime Minister Narendra Modi is on track for a third term in power after two key allies pledged their support to form a new government. The NSE Nifty 50 Index rose 0.9%, extending Wednesday’s 3% rally, as the benchmark continued to recoup losses, following the shock election result that saw Modi’s party losing its majority in parliament. The broader market outperformed, with a gauge for smaller companies rallying 3.3%. Investors will be closely watching who will be appointed to key cabinet portfolios and whether the coalition’s policies align with the previous administration’s focus on boosting infrastructure and manufacturing. “Markets will keenly watch certain key ministries, such as finance or road and highways, and whether there are credible faces heading them,” said Niraj Bhagwat, equity portfolio manager at Wellington Management. “Foreign investors will be enthused to see the key ministries largely unchanged in terms of policy direction.” Leaders of the the Bharatiya Janata Party-led National Democratic Alliance, including Nitish Kumar of the Janata Dal (United) and N Chandrababu Naidu of the Telugu Desam Party, agreed to back Modi after reaching an accord in New Delhi on Wednesday. Read the full story Indian stocks extend recovery as Modi secures coalition support NEW YORK/LONDON (June 6): World stocks hit an all-time high and the euro rose on Thursday after the European Central Bank cut interest rates for the first time in nearly five years, but also signalled that further moves could take a while. ECB policymakers duly delivered their widely-flagged quarter-point cut to 3.75%, but markets were left feeling a little deflated after the bank also said it now did not expect inflation to fall back to target until 2026. It was enough to snip the pan-European STOXX 600’s gains back to 0.6%, while the euro inched up to almost US$1.0890 against the dollar and government bond yields — which reflect borrowing costs and move inversely to price — ticked up too. MSCI’s 47-country main world index rose as much as 0.3% to a record high. On Wall Street, the S&P 500 index was flat near an all-time high, the Dow Jones Industrial Average added 0.4%, while the Nasdaq Composite Index dipped 0.1%, also from an all-time high. Chipmaker Nvidia fell 0.8% from a record high, after crossing US$3 trillion World stocks at record high after cautious ECB rate cut (RM14.1 trillion) in market valuation in the previous session. “The focus for markets (now) is whether they will find room to cut in September,” Saltmarsh Economics’ Marchel Alexandrovich said. He said it wasn’t a surprise that inflation forecasts had been revised up. “Inflation is proving sticky and that makes it difficult.” The euro’s gain, after a 2% rise over the last month, took it to US$1.0888, although most traders were sitting on their hands, with president Christine Lagarde stressing at the start of her post-meeting press conference: “We are not pre-committing to a particular rate path”. Stronger-than-expected data over the last few weeks, plus Thursday’s increase in the ECB’s in-house inflation forecasts, have raised doubts about how many more cuts will be justified this year. “This was a cautious cut,” said Samuel Zief, head of global FX strategy at JPMorgan Private Bank. “We currently think that September could be next. But (there is) no reason to expect significant reductions any time soon with growth actually picking up steam of late.” BY MARC JONES & KOH GUI QING Reuters BY ASHUTOSH JOSHI & ALEX GABRIEL SIMON Bloomberg

FRIDAY JUNE 7, 2024 18 THEEDGE CEO MORNING BRIEF WORLD (June 6): The US Justice Department and the Federal Trade Commission have reached a deal that allows them to proceed with antitrust investigations into the dominant roles that Microsoft, OpenAI and Nvidia play in the artificial intelligence industry, according to a source familiar with the matter. Under the deal, the US Department of Justice will take the lead in investigating whether Nvidia violated antitrust laws, while the FTC will examine the conduct of OpenAI and Microsoft. While OpenAI’s parent is a nonprofit, Microsoft has invested US$13 billion (RM61 billion) in a for-profit subsidiary, for what would be a 49% stake. The Microsoft-OpenAI partnership is also under informal scrutiny in other regions. The regulators struck the deal over the past week and it is expected to be completed in the coming days, the person said. The FTC is also looking into Microsoft’s US$650 million deal with AI startup Inflection AI, a person familiar with the matter said. The probe was first reported by the Wall Street Journal and the regulators’ agreement by the New York Times. OpenAI and Nvidia did not immediately reply to requests for comment on Thursday. Microsoft said it has complied with its legal obligations. The moves signal growing regulatory scrutiny into the AI industry. In January, the FTC ordered OpenAI, Microsoft, Alphabet Amazon and Anthropic to provide information on recent investments and partnerships involving generative AI companies and cloud service providers. In July last year, the FTC opened an investigation into OpenAI on claims it had run afoul of consumer protection laws by putting personal reputations and data at risk. Last week, US antitrust chief Jonathan Kanter referred to “structures and trends in AI that should give us pause,” at an AI conference, adding that the technology relies on massive amounts of data and computing power, which can give already-dominant firms a substantial advantage. US regulators to open antitrust inquiries of Microsoft, OpenAI and Nvidia (June 6): Microsoft Corp, Nvidia Corp and Apple Inc are now worth more combined than China’s stock market. With a total market capitalisation of about US$9.2 trillion (RM43.2 trillion), the three most valuable tech firms have overtaken all of the nearly US$9 trillion worth of stocks actively traded on Chinese exchanges excluding Hong Kong, according to data compiled by Bloomberg. Investor demand for artificial intelligence exposure has propelled many shares in the sector to record highs. Nvidia — arguably the biggest beneficiary of a massive flood of AI spending of the past year — saw its market capitalisation hit US$3 trillion this week, becoming the first computer-chip firm to do so. The Santa Clara, California-based company has dominated the market with its highly sought-after products that help power data centers running complex AI computing tasks. Meanwhile, Microsoft has invested in OpenAI and is infusing AI features in its products and services. Apple has not had the strongest showing this year as the technology giant’s shares were pressured by concerns over cooling iPhone demand in China and a US$2 billion fine from the European Union. However, shares in the company have just turned positive for 2024 as investor sentiment toward the iPhone maker slowly improves. “Momentum and growth seekers will be content to trust in Microsoft, Apple and Nvidia owing to their powerful competitive positions, fat profit margins and strong balance sheets,” said Russ Mould, investment director at AJ Bell. “The danger here is to mistake reliability for safety, again because a very lofty valuation can leave a share price exposed on the downside if expectations are very high and something unexpected happens,” said Mould. Read also: Nvidia overtakes Apple as No 2 most valuable company ASML overtakes LVMH as Europe’s second-biggest stock Nvidia, Microsoft and Apple are bigger than China’s stock market BY SUBRAT PATNAIK Bloomberg BY JODY GODOY Reuters BLOOMBERG

FRIDAY JUNE 7, 2024 19 THEEDGE CEO MORNING BRIEF 2024 Honouring Malaysia’s Best PerforMing Mid-CaP CoMPanies to Be revealed soon Presented by

FRIDAY JUNE 7, 2024 20 THEEDGE CEO MORNING BRIEF WORLD (June 6): Trading platform Robinhood Markets said on Thursday it has agreed to buy cryptocurrency exchange Bitstamp for around US$200 million (RM939.7 million) in cash, speeding up a broader push into digital assets with its biggest ever deal. The 11-year-old trading app, popular among retail traders, has been looking to expand its product offerings to mature into a full-fledged financial services provider. The acquisition of Bitstamp, which was founded in 2011 and holds 50 active licences and registrations globally, puts Robinhood in direct competition with industry giants such as Binance and Coinbase. Bitstamp will power the growth of Robinhood Crypto and is set to become its first institutional business. Bitstamp’s core spot exchange, popular in Europe and Asia, has over 85 tradable assets and includes products like staking and lending. “We are in our early days in the EU and we are excited to keep expanding there and beyond. The acquisition of Bitstamp will accelerate our global expansion,” Johann Kerbrat, vice president and general manager of Robinhood Crypto, told Reuters. The deal, which is expected to close in the first half of 2025, comes at a time when Robinhood’s crypto business is seeing rapid growth but also facing regulatory hurdles in the US Kerbrat said the company intends to keep communicating with regulators as it moves forward. Robinhood’s crypto business was the driving force behind a massive first-quarter earnings beat in May, but that same week, it had also disclosed that it received a ‘Wells’ notice from the US Securities and Exchange Commission. The notice signals possible upcoming enforcement action. The markets regulator has argued that crypto tokens should be considered securities and subject to its registration rules. Crypto firms, on the other hand, have accused the SEC of overreach. Robinhood’s stock has surged 69% this year after it vowed to chase ‘profitable growth’. Analysts expect it is primed for more gains amid a resurgence of retail trading and increasing crypto adoption. Robinhood bets big on crypto with US$200 mil deal for Bitstamp LONDON (June 6): Gold prices are expected to hit another record high this year despite a dip in physical demand, consultancy Metals Focus said, as interest rate cuts arrive against a backdrop of US-China tensions and conflict in Ukraine and the Middle East. Demand for gold will likely slip 2% to 4,639 metric tonnes this year, with lower jewellery fabrication, declining net physical investment and reduced central bank appetite, Metals Focus said in its annual report on Thursday. Safe-haven demand driven by geopolitical and economic uncertainty as well as persistent central bank buying contributed to a rally in gold from March to May, taking spot prices to a record US$2,449.89 (RM11,511.42) per ounce on May 20. “Although there are downside risks in the near term, we are confident that prices will see a new record before the end of the year and average US$2,250 for the full year, marking another annual average record,” Metals Focus said. Sentiment towards gold is supported by fears over US government debt, the Gold prices may hit another record high in 2024, Metals Focus says BY POLINA DEVITT Reuters BY MANYA SAINI Reuters anticipated arrival of rate cuts, elevated geopolitical tensions and economic uncertainties, it said. From the point of view of fundamentals, demand from central banks remains significantly higher than pre-2022 when they sped up purchases to diversify foreign currency reserves, providing further support to the price. “Near-term (price) corrections are likely, as tactical players take profits or are perhaps triggered by liquidations in equities,” Metals Focus said. “The downside however should be limited, as there are still investors sitting on the sidelines waiting for opportunities to enter the market.” Meanwhile gold supply, according to the consultancy, will likely rise by 3% to 5,083 tonnes this year, with mine production and recycling both higher. BLOOMBERG REUTERS

FRIDAY JUNE 7, 2024 21 THEEDGE CEO MORNING BRIEF WORLD (June 6): China’s main national chip fund should wind up raising more than the US$47.5 billion (RM223.06 billion) originally disclosed, a senior adviser to Beijing said, reflecting the government’s resolve to close a technology gap with the US. More state-backed firms are likely to join investors such as Industrial and Commercial Bank of China Ltd in contributing capital, Li Ke, a member of the committee that advises the fund, told Bloomberg News. That reflects the government’s resolve to create a self-sufficient domestic semiconductor industry, said Li, who is also the deputy general manager of CCID Consulting Co, an agency backed by a research arm of the Ministry of Industry and Information Technology. Chinese government agencies have stepped up efforts since 2023 to overcome US sanctions and propel local players from Semiconductor Manufacturing International Corp to Huawei Technologies Co. Key to that thrust is the National Integrated Circuit Industry Investment Fund — known colloquially as the Big Fund — which funnels state capital into important chip projects and companies. The Big Fund’s third vehicle was set up just last month and will operate under a 10-year time frame, longer than the five years the first two were accorded, Li said. That means, in effect, there could be a “Big Fund 3.5”, he added. “The technology gap still exists, that’s why we needed the third phase. There’s still work to do since the issue of chokepoints hasn’t been resolved,” Li said in an interview on the sidelines of the World Semiconductor Conference in Nanjing. “The third fund remains open and more capital could be injected during its 10-year window.” China’s big chip fund to exceed US$47.5 bil goal, adviser says (June 6): Mark Mobius said Hong Kong needs to take better advantage of its strengths to retain its competitive edge, becoming the latest influential figure to weigh in on the city’s future. “If you don’t move with the times, you risk getting left behind,” the co-founder of Mobius Capital Partners LLP wrote in a blog post, titled Hong Kong: Far from Over. “In dropping its colonial baggage, Hong Kong must reinvent itself and make better use of the strengths it has cultivated over the years.” The 87-year-old money manager said he was surprised by the level of pessimism surrounding Hong Kong during a recent visit to the city, adding that it was clear from his trip that “the fundamental spirit” of Hong Kong’s business environment is still “very much alive”. Comparing the city to an undervalued stock, Mobius said from an investment perspective it’s “never a good idea to write off the potential of any city or country”, and no market is ever “really out of the game”. He pointed to the growing rivalry between the US and China over tech and artificial intelligence (AI) as an area that Hong Kong could leverage. “The jury is still out on whether China can surpass the US in the ongoing tech race,” said Mobius. “In the meantime, I believe Hong Kong would stand to benefit significantly by embracing technology and AI to align with China’s ambitious plans, and to solidify its role as China’s bridge to the world.” Hong Kong is seeking to revive its battered image, after a national security crackdown and years of isolation during the Covid-19 pandemic drew international criticism. Leader John Lee has focused on luring conferences and other global events to draw visitors, while Finance Secretary Paul Chan has been trying to sell the city’s appeal overseas — most recently with a trip to the US. The government on Wednesday released a promotional video featuring twotime NBA All-Star Stephon Marbury, who was granted admission via the city’s talent programme last year, and said Hong Kong would be his “third home” after Beijing. Economist Stephen Roach, during a visit to Hong Kong this week, doubled down on his view that the city’s outlook is being fatally undermined by its waning autonomy and China’s slowdown. While Chinese and Hong Kong officials say the city faces a bright future, there is sense from Beijing that the finance hub needs to rethink its approach. Xia Baolong, the director of the Hong Kong and Macau Affairs Office, said in April the city needed to solve its problems using “new thinking, new methods and new routes”, according to the South China Morning Post. Mobius says Hong Kong needs to reinvent itself to prosper BY SANGMI CHA Bloomberg Bloomberg BLOOMBERG

FRIDAY JUNE 7, 2024 22 THEEDGE CEO MORNING BRIEF WORLD Airline group aims to lure travellers by cutting transit hassles America’s partners in Indo-Pacific region sign economic pact BY PHILIP J HEIJMANS Bloomberg BY DANNY LEE Bloomberg (June 6): The US and 13 other nations in Asia and the Pacific signed agreements on an economic pact key to Washington’s strategy to build clout in the region. Partners of the Indo-Pacific Economic Framework (IPEF) signed the clean economy and fair economy agreements, US Secretary for Commerce Gina Raimondo told reporters in a briefing in Singapore at the end of the two-day forum. The agreements represent two of the so-called “four pillars” that the pact rests on. “I wanted to demonstrate to our partners that the US doesn’t just say what our intentions are, but we show up,” Raimondo said. “We need to do the hard work of identifying opportunities, making connections, and being present in the region and in Singapore we’ve done just that.” The IPEF is part of a sweeping effort led by US President Joe Biden to counter China’s deep-rooted economic influence in Asia. The other participating countries include Japan, India and South Korea, which all rank among the 10 biggest national economies in the world, with the 14 nations included representing about US$38 trillion (RM178.46 trillion) in economic output. While the accord on clean economy focuses on the transition to renewable energy and fighting climate change, the one on fair economy relates to taxation and corruption issues. The stakeholders earlier agreed on the supply-chain pillar, which aims to avoid the kind of bottlenecks that occurred during the Covid-19 pandemic, but they fell short of a deal on the final trade pillar over thornier issues such as rules for digital commerce and labour. A senior US commerce official did not comment on when or indeed whether the various sides would reach a deal on the final pillar. While noting that not all partners signed the accords on Thursday, the official said a couple of countries are completing domestic processes and have indicated their intention to sign off on it soon. Raimondo announced earlier on Thursday that a coalition including allied climate partners, BlackRock, GIC, the Rockefeller Foundation and Temasek has committed to invest over US$25 billion in capital that can be deployed in the Indo-Pacific emerging market infrastructure. She also said the countries came today identifying over US$23 billion of priority infrastructure projects and US industry is directly connected with the government on those investment opportunities. Singapore’s Prime Minister Lawrence Wong earlier in the day said at the forum that the 10-nation bloc of Southeast Asian nations is keen to deepen ties with the US to benefit from the peace and prosperity brought by America’s presence in the region. “For decades, America’s presence in Asia has brought peace and prosperity and created a stable environment for countries like Singapore to prosper,” Wong said during his remarks at the forum. “That’s why Singapore has long been an advocate for the US to actively engage the region, especially Southeast Asia.” (June 6): Flying multiple airlines to get to your ultimate destination comes with a myriad of hassles. A global airline group led by American Airlines Inc and British Airways is aiming to make airport transits more seamless for passengers. Oneworld plans to launch a technology platform later this year that will allow travellers to check-in, including their luggage, just once across different carriers, chief executive officer Nat Pieper said in an interview with Bloomberg News on Monday. He hopes the improvements will make connections more attractive while saving cost for his airline members and generating more revenue. “We want a multi-carrier travel experience to be the same as a connecting experience for if you’re flying on the same airline,” said Pieper, speaking at IATA’s annual airline meeting in Dubai. The 13-strong Oneworld alliance, which also includes the likes of Cathay Pacific Airways Ltd and Qatar Airways QCSC, is hoping to encourage more connections among its airlines, especially for harder to reach destinations like China, India and across South America where it has no members, pushing passengers to use rival airlines. “There’s cost efficiency. Your revenue is going to be richer because you’re delivering a better experience on that,” Pieper said. The alliance aims to fill in the regions it currently does not cover with new airline members in the long run, but is not in a hurry, Pieper said. The new technology platform though will enable new members to join and be integrated into the group much quicker, he added. US allies in Indo-Pacific to sign key accords of economic pact BLOOMBERG

FRIDAY JUNE 7, 2024 23 THEEDGE CEO MORNING BRIEF WORLD CAIRO/JERUSALEM (June 6): Israel hit a Gaza school on Thursday in an airstrike that it said targeted and killed Hamas fighters inside, while a Hamas official said 40 people including women and children were killed as they sheltered in the UN site. Ismail Al-Thawabta, the director of the Hamas-run government media office, rejected Israel’s assertion that the UN school in Nuseirat, in central Gaza, had hidden a Hamas command post. “The occupation uses...false fabricated stories to justify the brutal crime it conducted against dozens of displaced people,” Thawabta told Reuters. Israel’s military said it had taken steps to protect civilians before its fighter jets carried out a “precise strike”, circulating satellite photos highlighting two parts of a building where it said the fighters were based. “We’re very confident in the intelligence,” military spokesperson Lt Col Peter Lerner told a briefing with reporters, accusing Hamas and Islamic Jihad fighters of deliberately using UN facilities as operational bases. He said 20-30 fighters were located in the compound, and many of them had been killed, but had no precise details as intelligence assessments were being carried out. “I’m not aware of any civilian casualties and I’d be very, very cautious of accepting anything that Hamas puts out,” he said. The school, run by the UN Palestinian refugee agency (UNRWA), may have been hit several times, said the agency’s communications director, Juliette Touma. She said she could not confirm the death toll at this stage. Media in Hamas-run Gaza had earlier put the toll at 35-40. Thawabta and a medical source said 40 had been killed, including 14 children and nine women. Israel announced a new military campaign in central Gaza on Wednesday as it battles fighters relying on hit-and-run insurgency tactics. It says there will be no halt to fighting during ceasefire talks, which have intensified since US President Joe Biden outlined a proposal on Friday. Dozens reported killed in Israeli strike on Gaza school, Israel says Hamas inside BRUSSELS (June 6): A Meta plan to use personal data to train its artificial intelligence (AI) models without seeking consent came under fire from advocacy group NOYB on Thursday, which called on privacy enforcers across Europe to stop such use. NOYB (none of your business) urged national privacy watchdogs to act immediately, saying recent changes in Meta’s privacy policy, which come into force on June 26, would allow it to use years of personal posts, private images or online tracking data for the Facebook owner’s AI technology. The advocacy group said it has launched 11 complaints against Meta and asked data protection authorities in Austria, Belgium, France, Germany, Greece, Italy, Ireland, the Netherlands, Norway, Poland and Spain to launch an urgency procedure because of the imminent changes. Meta rejected NOYB’s criticism and referred to a May 22 blog in which it said it uses publicly available online and licensed information to train AI as well as informaMeta faces call in EU not to use personal data for AI models tion that people have shared publicly on its products and services. However, a message sent to Facebook users said Meta may still process information about people who do not use its products and services nor have an account if they appear in an image or are mentioned in posts or captions shared by a user. “We are confident that our approach complies with privacy laws, and our approach is consistent with how other tech companies are developing and improving their AI experiences in Europe (including Google and Open AI),” a spokesperson said. NOYB has already filed several complaints against Meta and other Big Tech companies over alleged breaches of the EU’s General Data Protection Regulation (GDPR) which threatens fines up to 4% of a company’s total global turnover for violations. Meta has previously cited a legitimate interest for using users’ data to train and develop its generative AI models and other AI tools, which can be shared with third parties. BY FOO YUN CHEE Reuters BY NIDAL AL-MUGHRABI & JAMES MACKENZIE Reuters BLOOMBERG

FRIDAY JUNE 7, 2024 24 THEEDGE CEO MORNING BRIEF WORLD NEW YORK (June 6): A recently launched US Treasuries buy-back programme should improve liquidity in the US government bond market while other initiatives will boost transparency on prices and visibility on the use of leverage, a Treasury official said on Wednesday. The Treasury launched a buy-back programme last month to provide market participants a regular opportunity to sell back to Treasury off-the-run securities, which are older and less liquid, across the yield curve. The last time it executed regular buy-back operations was in 2000 for about two years. Buy-backs are expected to encourage dealers to make markets for off-the-run securities, “as they will have Treasury as a regular and predictable buyer,” said assistant secretary for financial markets Joshua Frost in prepared remarks for the ISDA/SIFMA Treasury Forum in New York. They are also expected to prompt more trading and allow bond dealers to free up balance sheets, he said. The first buy-back took place last week and while Treasury expects to hold weekly purchases, with caps that in coming months will go up to US$30 billion (RM140.89 billion) per quarter, the outcome of the operations will depend on prices, said Frost. “Let me be clear: Treasury aims to be a price sensitive buyer. We may buy back less than the stated maximum, or nothing at all, in any operation depending upon the quality of offers that we receive,” he said. Buy-backs are part of a slate of initiatives launched by the Treasury and other institutions to improve liquidity and avoid trading disruptions in the world’s biggest bond market, the bedrock of the global financial system. In December, the US Securities and Exchange Commission adopted a key reform to boost the use of central clearing for US Treasuries which will apply to the cash Treasury and repo markets, where banks and funds trade loans backed by Treasuries. Debt buy-back programme set to improve liquidity, says US Treasury official (June 6): Some US$175 billion (RM822.3 billion) worth of debt backed by assets such as cars, credit cards and consumer loans have been sold in the US and Europe so far in 2024, according to data compiled by Bloomberg, in what is shaping up to be the busiest half of issuance for the sector in at least six years. Asset-backed securitisation deals, where loans are packaged up and sold in bond-like instruments, have grown in popularity as banks seek ways to offload risk and refinance loans taken out during the easy-money era. If sales continue at the current pace, the first six months of 2024 will be the best half since at least 2018, the earliest year for which data compiled by Bloomberg is available. The uptick in issuance this year comes amid a general rally across credit, fuelled by the prospect of rate cuts in the second half of 2024. ABS deals’ appeal comes from the high yields they offer in exchange for debt secured against a wide pool of assets. This is especially true in a Asset-backed debt sales reach US$175 bil in first half BY ABHINAV RAMNARAYAN & ELEANOR DUNCAN Bloomberg BY DAVIDE BARBUSCIA Reuters higher-for-longer environment because such instruments typically have floating rates. “We’ve seen a fantastic rally so far this year,” Owen Muller, a director in Natwest’s Securitised Products and Alternatives Syndicate business, said during a panel session at the Invisso Global ABS conference in Barcelona. “A lot of issuers came to market in the first half of the year because there was a strong window.” The issuance volumes so far in 2024 suggest that this year could “comfortably” be the best post-crisis year so far, Andrew South, head of structured finance research at S&P Global Ratings said at the Invisso conference on Tuesday. “In a higher for longer environment, investors are very happy to allocate to this floating-rate asset class as it is offering attractive returns for secured debt,” said Cas Bonsema, an ABS and covered bond analyst at Rabobank. “Issuance is set to keep coming in the near term.” REUTERS REUTERS Read also: Rising US debt load poses a growing risk for Treasury market

FRIDAY JUNE 7, 2024 25 THEEDGE CEO MORNING BRIEF WORLD (June 6): Wealthy people in the UK, from foreign billionaires to City of London bankers, are rushing to shelter their money after Prime Minister Rishi Sunak surprised the country by calling a summer election. Some are cashing in investments, paying off bills that may soon rise or leaving the UK entirely, according to interviews with more than two dozen high-net-worth individuals, who asked not to be named, and wealth advisers. The ruling Conservatives and the opposition Labour party have both pledged to scrap preferential tax treatment for non-domiciled residents — rich foreigners living in the UK, also known as non-doms. Labour leader Keir Starmer has additional plans to tax the wealthy and polls show his party more than 20 points ahead. “I have had previously hesitating clients go into panic mode,” David Lesperance, a Poland-based tax and immigration adviser for the ultra-rich, said on Sunak calling the July 4 vote. He “pulled the pin on the election grenade”. The UK was expected to lose a net 3,200 high-net-worth individuals last year, the most in Europe and double 2022’s level, citizenship advisory firm Henley & Partners estimated. Britain’s reputation for legal and political stability has been rocked by the upheaval of Brexit and the chop-andchange of five different Tory prime ministers since 2016. As well as losing ground to popular territories for the well-heeled such as Monaco, Dubai and Switzerland, it has also had to compete with European neighbors like Italy and BY BEN STUPPLES & CHARLIE WELLS Bloomberg Britain’s rich race to protect their wealth from election hit Greece, which rolled out programs to lure wealthy foreigners. The UK scrapped its so-called golden visa programme in 2022. “It will be a serious, and entirely avoidable, misstep if these changes proceed as announced,” Dominic Lawrance, a London-based partner at global law firm Charles Russell Speechlys. Labour also wants to add taxes on private equity professionals and private school fees. As part of its non-dom proposal, it aims to remove inheritance tax exemptions for overseas assets held in trust structures. The idea of this major change has helped push up the price of insurance to cover possible levies on wealthy estates. The Conservatives and Labour have both pledged to scrap preferential tax treatment for nondomiciled residents — rich foreigners living in the UK, also known as non-doms. Labour leader Keir Starmer has additional plans to tax the wealthy and polls show his party more than 20 points ahead. Notable non-doms Non-dom status dates back to 1799, when it was introduced to protect colonial investments. Recent notable nondoms include former HSBC Holdings plc chief executive officer Stuart Gulliver and one-time Conservative Party deputy chairman Michael Ashcroft. Sunak’s wife, Akshata Murty, was also revealed in 2022 to benefit from the status. After a media storm, Murty said she would pay UK taxes on her global earnings, partly derived from Indian software giant Infosys Ltd. Labour leaders have previously estimated they can raise about £3 billion (US$3.8 billion or RM18.03 billion) from scrapping the regime, echoing recent academic research that predicted fewer than 100 wealthy foreigners with the status would subsequently leave the nation. The number of non-doms is already declining, falling by almost half to 68,800 in the decade to 2022, partly through an earlier change in the rules to stop individuals using the benefit permanently. Still, those retaining the status pay more than £8 billion in British taxes a year, according to latest official data. One City law firm has received more than three-dozen enquiries related to non-dom changes in the past few months, ranging from multibillionaires to centi-millionaires, according to people familiar with the matter. One individual has now left for Switzerland, while another is preparing to move to Italy, the people said, who asked not to be identified as the details are private. One London-based former hedge fund manager originally from outside the UK is moving to another European nation, partly due to frustrations over the political direction of both main parties. Another ultra-rich UK national with property investments is similarly considering ways of switching from living full time in the UK to only three months a year, with the balance spent between low-tax territories such as Dubai and Monaco. Simon Goldring, a tax and trust adviser for the ultra-wealthy at global law firm Ogier, said he has a handful of live cases of British residents wanting to relocate overseas, mostly from UK nationals frustrated with taxes hitting post-war highs. Rishi Sunak. Britain’s reputation for legal and political stability has been rocked by the upheaval of Brexit and the chop-and-change of five different Tory prime ministers since 2016. BLOOMBERG

FRIDAY JUNE 7, 2024 26 THEEDGE CEO MORNING BRIEF MARKETS Top 20 active stocks World equity indices Top gainers (ranked by %) Top losers (ranked by %) Top gainers (ranked by RM) Top losers (ranked by RM) NAME VOLUME CHANGE CLOSE YTD MARKET (MIL) (RM) CHANGE CAP (%) (RM MIL) WCT HOLDINGS BHD 231.230 0.150 0.775 56.57 1,098.4 SNS NETWORK TECHNOLOGY BHD 93.490 0.000 0.650 176.60 1,048.3 KAWAN RENERGY BHD 80.534 0.155 0.800 - 440.0 DATASONIC GROUP BHD 73.600 0.030 0.550 29.41 1,534.0 MYEG SERVICES BHD 68.280 -0.040 1.050 28.83 7,832.0 KGW GROUP BHD 65.850 0.015 0.225 12.50 108.6 SEALINK INTERNATIONAL BHD 65.700 0.035 0.335 97.06 167.5 EKOVEST BHD 59.580 0.020 0.455 -7.14 1349.3 DAGANG NEXCHANGE BHD 56.600 -0.005 0.475 18.75 1,649.2 POWERWELL HOLDINGS BHD 52.820 0.020 0.510 117.02 296.1 MALTON BHD 50.110 0.095 0.505 32.9 266.71 SIME DARBY PROPERTY BHD 48.870 0.060 1.300 108.00 8,841.1 MAH SING GROUP BHD 47.540 0.150 1.750 110.84 4,480.2 MALAYSIAN RESOURCES CORP BHD 44.530 0.020 0.655 47.19 2,926.2 WENTEL ENGINEERING HOLDINGS 43.47 0.030 0.380 - 437.0 VELESTO ENERGY BHD 41.340 0.005 0.265 15.22 2,177.1 TOP GLOVE CORP BHD 40.800 0.020 1.060 17.78 8,490.1 INTA BINA GROUP BHD 39.180 0.055 0.520 100.00 283.5 SBH MARINE HOLDINGS BHD 35.000 0.020 0.260 - 230.9 LEONG HUP INTERNATIONAL BHD 34.250 0.050 0.625 10.62 2,281.3 Data as compiled on Jun 6, 2024 Source: Bloomberg NAME CLOSE CHANGE VOLUME YTD MARKET (%) (‘000) CHANGE CAP (%) (RM MIL) KEY ALLIANCE GROUP BHD 0.010 100.00 2904.50 0.00 36.8 KAWAN RENERGY BHD 0.800 24.03 80534.31 - 440.0 WCT HOLDINGS BHD 0.775 24.00 231228.10 56.57 1,098.4 MALTON BHD 0.505 23.17 50107.90 32.89 266.7 DESTINI BHD 0.030 20.00 1670.20 -50.00 49.9 CHINA OUHUA WINERY HOLDINGS 0.035 16.67 304.90 -36.36 23.4 ECOBUILT HOLDINGS BHD 0.070 16.67 100.20 -22.22 29.5 ICON OFFSHORE BHD 0.910 16.67 21244.70 55.56 566.5 TA WIN HOLDINGS BHD 0.035 16.67 2403.90 -12.50 120.2 TFP SOLUTIONS BHD 0.035 16.67 3155.20 -36.36 20.5 INDUSTRONICS BHD 0.045 12.50 758 -10.00 31.84 SUPERLON HOLDINGS BHD 1.400 12.00 3278.8 61.85 222.03 INTA BINA GROUP BHD 0.520 11.83 39184.8 100.00 283.5 RENEUCO BHD 0.095 11.76 10377.2 -56.82 108.54 SEALINK INTERNATIONAL BHD 0.335 11.67 65696.9 97.06 167.5 HO HUP CONSTRUCTION CO BHD 0.150 11.11 2471.5 -40.00 77.74 MTOUCHE TECHNOLOGY BHD 0.05 11.11 25 -16.67 46.34 RANHILL UTILITIES BHD 1.56 10.64 14530.6 74.2 2021.69 GLOBETRONICS TECHNOLOGY BHD 1.47 10.53 29276.6 -8.6 992.36 NAIM HOLDINGS BHD 1.270 10.43 18,579.0 55.83 635.9 Data as compiled on Jun 6, 2024 Source: Bloomberg NAME CLOSE CHANGE VOLUME YTD MARKET (%) (‘000) CHANGE CAP (%) (RM MIL) EA HOLDINGS BHD 0.005 -50.00 925.0 -50.00 32.3 XOX BHD 0.010 -33.33 29,450.9 -33.33 51.9 ZEN TECH INTERNATIONAL BHD 0.015 -25.00 1,165.1 -25.00 46.7 LAMBO GROUP BHD 0.020 -20.00 70.8 0.00 30.8 SAUDEE GROUP BHD 0.020 -20.00 744.4 -20.00 31.2 ABM FUJIYA BHD 0.340 -13.92 15.7 -8.11 61.2 HUBLINE BHD 0.035 -12.50 454.6 -12.50 150.1 SAPURA ENERGY BHD 0.040 -11.11 9,762.8 -11.11 735.04 ENG KAH CORP BHD 0.375 -10.71 90.2 -1.32 44.3 DIGISTAR CORP BHD 0.050 -9.09 88.3 -16.67 23.7 SENTORIA GROUP BHD 0.050 -9.09 4,230.6 -44.44 30.7 TRIVE PROPERTY GROUP BHD 0.050 -9.09 6.4 -37.50 63.2 VINVEST CAPITAL HOLDINGS BHD 0.050 -9.09 78.4 -16.67 48.5 AVILLION BHD 0.055 -8.33 1,154.4 10.00 62.3 CARLO RINO GROUP BHD 0.220 -8.33 50.0 2.33 177.2 TECHNODEX BHD 0.055 -8.33 4,335.5 -31.25 46.4 NPC RESOURCES BHD 1.800 -7.69 3.0 0.00 204.1 BERTAM ALLIANCE BHD 0.125 -7.41 47.9 -16.67 40.3 ANNUM BHD 0.065 -7.14 318.7 -31.58 14.8 SINARAN ADVANCE GROUP BHD 0.065 -7.14 60.0 -23.53 59.5 Data as compiled on Jun 6, 2024 Source: Bloomberg NAME CLOSE CHANGE VOLUME YTD MARKET (RM) (‘000) CHANGE CAP (%) (RM MIL) APOLLO FOOD HOLDINGS BHD 7.050 -0.400 100.2 22.40 564.0 PETRONAS DAGANGAN BHD 18.300 -0.400 795.1 -16.21 18,180.2 AJINOMOTO MALAYSIA BHD 15.600 -0.180 182.5 10.44 948.5 HEINEKEN MALAYSIA BHD 23.700 -0.180 347.8 -1.82 7,159.7 NPC RESOURCES BHD 1.800 -0.150 3.0 0.00 204.1 MSM MALAYSIA HOLDINGS BHD 2.420 -0.140 2538.9 50.31 1,701.2 KOTRA INDUSTRIES BHD 4.370 -0.110 67.1 -9.52 648.1 PARAGON UNION BHD 3.630 -0.110 70.8 30.11 304.3 SD GUTHRIE BHD 4.330 -0.110 3694.3 -2.91 29,945.0 BATU KAWAN BHD 19.800 -0.100 11.4 -3.88 7778.4 ARKA BHD 2.050 -0.090 24.4 20.59 133.5 NOTION VTEC BHD 1.440 -0.090 24005.0 350.00 744.1 SOUTHERN ACIDS MALAYSIA BHD 3.450 -0.090 6.7 9.52 472.4 GAMUDA BHD 6.050 -0.080 4,349.5 31.81 16,759.7 PECCA GROUP BHD 1.330 -0.080 16562.5 2.31 999.87 SEE HUP CONSOLIDATED BHD 0.885 -0.080 2 -11.50 70.35 MALAYSIA AIRPORTS HOLDINGS 9.93 -0.070 6,845.4 34.92 16,568.8 NEGRI SEMBILAN OIL PALMS BHD 3.83 -0.070 3.4 22.36 268.9 KUALA LUMPUR KEPONG BHD 21.04 -0.060 1,582.5 -3.57 23,068.4 MNRB HOLDINGS BHD 2.37 -0.060 728.2 94.26 1,855.9 Data as compiled on Jun 6, 2024 Source: Bloomberg NAME CLOSE CHANGE VOLUME YTD MARKET (RM) (‘000) CHANGE CAP (%) (RM MIL) DUTCH LADY MILK INDUSTRIES 38.460 1.100 73.00 66.06 2,461.4 NESTLE MALAYSIA BHD 124.800 0.800 52.80 6.12 29,265.6 MALAYSIAN PACIFIC INDUSTRIES 38.500 0.500 426.40 36.52 7,658.8 TENAGA NASIONAL BHD 13.700 0.440 20674.70 36.45 79,286.5 BLD PLANTATION BHD 11.000 0.400 1.20 0.00 1,028.5 UNITED PLANTATIONS BHD 24.500 0.400 536.00 39.82 10,162.2 KELINGTON GROUP BHD 3.380 0.210 4124.10 55.76 2,262.6 IDEAL CAPITAL BHD 3.600 0.190 10.00 20.00 1800.0 SAM ENGINEERING & EQUIPMENT 6.550 0.190 834.10 64.09 4,434.3 BURSA MALAYSIA BHD 8.650 0.160 2043.90 25.18 7,000.4 PANASONIC MANUFACTURING 20.640 0.160 13.6 14.67 1,253.8 KAWAN RENERGY BHD 0.800 0.155 80534.3 - 440.0 BM GREENTECH BHD 1.620 0.150 7317.20 79.01 835.9 MAH SING GROUP BHD 1.750 0.150 47535.8 110.84 4,480.2 RANHILL UTILITIES BHD 1.560 0.150 14,530.6 74.20 2,021.7 SUPERLON HOLDINGS BHD 1.400 0.150 3,278.8 61.85 222.0 WCT HOLDINGS BHD 0.775 0.150 231,228.1 56.57 1,098.36 GLOBETRONICS TECHNOLOGY BHD 1.470 0.140 29,276.6 -8.60 992.4 ICON OFFSHORE BHD 0.910 0.130 21,244.7 55.56 566.53 CRESCENDO CORP BHD 3.650 0.120 512.2 63.15 1,019.9 Data as compiled on Jun 6, 2024 Source: Bloomberg CLOSE CHANGE CHANGE (%) CLOSE CHANGE CHANGE (%) DJIA * 38,807.33 96.04 0.25 S&P 500 * 5,354.03 62.69 1.18 NASDAQ 100 * 19,035.05 380.21 2.04 FTSE 100 * 8,246.95 25.96 0.31 AUSTRALIA 7,821.77 52.77 0.68 CHINA 3,048.79 -16.61 -0.54 HONG KONG 18,476.80 51.84 0.28 INDIA 75,074.51 692.27 0.93 INDONESIA 6,974.90 27.23 0.39 JAPAN 38,703.51 213.34 0.55 KOREA 2,689.50 27.40 1.03 PHILIPPINES 6,509.86 68.54 1.06 SINGAPORE 3,330.81 0.80 0.02 TAIWAN 21,902.70 417.82 1.94 THAILAND 1,328.41 -9.91 -0.74 VIETNAM 1,283.56 -0.79 -0.06 Data as compiled on Jun 6, 2024 * Based on previous day’s closing Source: Bloomberg CPO RM 3,96155.00 OIL US$ 78.690.28 RM/USD 4.6950 RM/SGD 3.4851 RM/AUD 3.1222 RM/GBP 6.0024 RM/EUR 5.1082