THE EDGE 22 APRIL 2022 JUMAAT

SERBA DINAMIK GIVES ITS TAKE ON WHY
AG ISSUED A COMPOUND OFFER p4

FRIDAY, APRIL 22, 2022 w w w. t h e e d g e m a r k e t s. c o m

ISSUE 368/2022

CEOMorningBrief
HOME: PNB plans to invest RM10 bil in green and transition assets by 2030 p5
Malaysia Airlines’ parent reports improved FY21 on successful restructuring, cargo revenue growth p6

Ismee says Jho Low is 1MDB’s ‘hidden hand’, ex-CFO tells court p8
WORLD: A prolonged China slowdown raises risks for global economy, IMF chief says p18

ECB rate at zero or more by year end a ‘no brainer’, Wunsch says p20

BLOOMBERG

PAC chairman: Govt
‘confused’ on who appointed

MySejahtera vendor

Report on Page 3.

FRIDAY APRIL 22, 2022 2 THEEDGE CEO MORNING BRIEF

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KUALA LUMPUR (April 21): The ju- Judiciary lodges never reached out to nor received any com-
diciary has lodged a police report against police report munication from political leaders in rela-
ex-Felda chairman Tan Sri Shahrir Sam- tion to the ongoing court cases involving
ad for alleging a conspiracy between the against Shahrir Najib and Zahid.
Chief Justice Tun Tengku Maimun Tuan Samad over
Mat and political leaders to speed up the conspiracy “Pending court cases shall proceed and
trial and sentencing of former Malaysian accusations continue in accordance with the law with-
Prime Minister Datuk Seri Najib Razak out any intervention by the Chief Justice
and former Deputy Prime Minister Datuk BY SEAH EU HEN or any other person,” the statement read.
Seri Dr Ahmad Zahid Hamidi. theedgemarkets.com
The chief registrar stressed that parties
In a statement on Thursday (April 21), responsible for making and spreading the
the Chief Registrar of the Federal Court of accusations intend to bring the judiciary
Malaysia referred to the accusation made by into disrepute and cause the loss of public
Shahrir Ahmad on Facebook on April 20, trust in the judiciary.
which had insinuated that there was a con-
spiracy, secret pact or illegal pact between “In addition, these accusations are in-
political leaders and the Chief Justice. tended to subvert the administration of
justice in terms of the ongoing trials and
The chief registrar said the accusation cases involving Datuk Seri Najib Razak
was unfounded as the Chief Justice had and Datuk Seri Ahmad Zahid Hamidi,”
the statement added.

SRC trial judge Nazlan lodges police report against Malaysia Today
over ‘unexplained RM1m’ allegation

KUALA LUMPUR (April 21): Court BY IZZUL IKRAM investigations under Section 500 (defa-
of Appeal Judge Datuk Mohd Nazlan theedgemarkets.com mation) of the Penal Code, Section 233
Mohd Ghazali has lodged a police report (improper use of network facilities or
against news portal MalaysiaToday over Malaysia Today had posted an article service) of the Communications and
an article that alleged that he was under by Raja Petra Kamarudin on Wednesday Multimedia Act 1998, and other relat-
investigation over a purported sum of (April 20) titled “Judge Mohd Nazlan be- ed legal provisions.
RM1.036 million in his bank account ing investigated for unexplained RM1 mil-
that could not be explained. lion in his bank”. The chief registrar’s office added that
it has also urged the police to conduct
In a statement on Thursday (April The chief registrar’s office said Nazlan an investigation immediately in order to
21), the Federal Court chief registrar's had lodged the report to facilitate police preserve the public’s confidence in the
office said Nazlan had denied the “false, nation’s judiciary and to ensure that the
baseless and malicious allegations", add- administration of justice runs smoothly.
ing the allegations were aimed at un-
dermining his credibility as an appellate The now appellate court judge had
court judge as well as disrupting the ad- previously served as a High Court judge
ministration of criminal justice and the and had presided over former prime
judiciary. minister Datuk Seri Najib Razak’s SRC
International Sdn Bhd trial. He had sen-
“The chief registrar’s office takes tenced Najib to 12 years in jail plus a
such allegations and comments seriously RM210 million fine after finding him
and reminds the public that allegations guilty of seven criminal charges relating
against the judiciary aimed at interfer- to the former 1MDB unit.
ing with cases that are in the process of
trial are a violation of the principle of Najib’s conviction was affirmed by
sub judice,” it said. the Court of Appeal last year and is now
pending appeal before the Federal Court.

FRIDAY APRIL 22, 2022 3 THEEDGE CEO MORNING BRIEF

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PAC chairman: Govt ‘confused’
over who appointed MySejahtera vendor;

no formal agreement ‘since day one’

KUALA LUMPUR (April 21): The gov- BY TIMOTHY ACHARIAM “We raise again the issue of intellectual
ernment is “unable to ascertain and is con- theedgemarkets.com property rights owner of MySejahtera app,
fused” as to who decided on the develop- in view of a legal suit where the parties
ment and procurement of MySejahtera, volved. Those are the most important claim that the rights are owned by MySJ
according to Public Accounts Committee things. Sdn Bhd. This claim is supported by the
(PAC) chairman Wong Kah Woh. fact that there were sales of shares and li-
“And now the government is still [say- censing agreement which involved a sum
Speaking to reporters on Thursday ing] they are in the midst of negotiating of over RM300 million,” he added.
(April 21), Wong said that there is a big the price with the vendor, and this is some-
confusion within the government itself as thing that shouldn’t [be happening] at all. PAC yet to decide on additional
to which body appointed KPISoft Sdn witnesses
Bhd to develop the MySejahtera app in “If you have a government procurement Moving forward,Wong said that the PAC
April 2020. you need to finalise the terms from day may call anyone after they have dispensed
one, [not] wait two years down the road with the agencies from the Prime Minis-
He added that there has been no formal [to go] into negotiation. ter’s department.
contract entered between the government
and KPISoft “since day one”, aside from a “[Our concern is] why the government He said that the PAC will need to go
non-disclosure agreement (NDA) signed is putting themselves in a situation whereby through documents and evidence which
between the National Security Council they have to pay the developer for MyS- have been shared to ascertain if they need
(MKN) and KPISoft on the data collect- ejahtera, of which in fact the whole thing to call any more witnesses to testify before
ed via the app. has started as a CSR (corporate social re- giving their final report on the MySejahtera
sponsibility),” he added. procurement.
Wong said this after a three-hour pro- The questions raised by PAC
ceeding on the development and procure- According to Wong, the key questions “We will go through evidence given by
ment of MySejahtera, during which the asked were about the appointment pro- the minister’s last week and today.We ha-
PAC called in representatives from three cess of KPISoft, now Entomo (M) Sdn ven’t decided on whether to call further
agencies under the Prime Minister’s De- Bhd, in developing the MySejahtera ap- witnesses,” he said.
partment, namely MKN, the Malaysian plication, namely which agency endorsed
Administrative Modernisation and Man- the appointment. He said that if they do not require
agement Planning Unit and the National more witnesses then he and the PAC
Cyber Security Agency. “Some other issues [included] wheth- will finalise their report to be handed
er there were other companies who had to parliament.
Last week, Health Minister Khairy Ja- put up their proposals, and what the jus-
maluddin and Finance Minister Tengku tifications of this appointment were and The PAC investigation was initiated af-
Datuk Seri Zafrul Abdul Aziz were called also the status of the proposal by way of ter news broke that MySejahtera’s devel-
in to testify on the same issue. CSR which now turned out to be so called oper Entomo Malaysia was in a five-year
limited CSR of one year. licence agreement with its nominee’s sub-
“From what I can say, the procurement sidiary MySJ for the transfer of the MyS-
process was not well handled. Because in “We want to know whether at the start ejahtera app to the latter for a RM338.6
normal circumstances, the government will of the proposal [whether] the CSR idea million price tag.
either have direct negotiations with the was already there or not,”Wong said.
vendor or have an open tender or a limit- MySejahtera’s ownership also caught
ed tender. Here, the big confusion is ‘who public attention following a shareholder
made the appointment and what was the dispute initiated by MySJ’s 7.03% share-
justification?’. This was [one of] the key holder P2 Asset Management Sdn Bhd
questions we asked,”Wong said. against Revolusi Asia Sdn Bhd, Entomo
Malaysia and MySJ.
“I can only say I think the government
themselves are confused as to who [made Revolusi is a nominee for Entomo in
the decision].That is quite a serious issue holding the majority stake of 81.43% in
of government appointment,” he added. MySJ. The app was originally a CSR ini-
tiative by Entomo Malaysia, then known
Appointment documentation records ‘ as KPISoft.
not clear’
Wong, who is also Ipoh Timor member While Prime Minister Datuk Seri Ismail
of parliament, explained that “the docu- SabriYaakob previously said that the gov-
mentation records for the appointments ernment would pay for MySejahtera’s us-
are not clear.” age from April 1, 2021, the PAC confirmed
that no payment has been made so far.
“Apart from the NDA signed, there is
no other contract signed after two years The PAC, in a December 2021 report,
[since the app was rolled out to firm up] said that the government should not be
the parties’ obligations and the costs in- paying for the use of the app as it was de-
veloped as a CSR initiative.

FRIDAY APRIL 22, 2022 4 THEEDGE CEO MORNING BRIEF

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KUALA LUMPUR (April 21): Serba Di- Serba Dinamik singled out in the SC’s single charge in
namik Holdings Bhd believes an “internal gives its take on the Shah Alam High Court for falsifying
irreconcilability” of the charges levelled why AG issued a revenue, which it said implied that the
by the Securities Commission Malaysia compound offer false RM6.014 consolidated cumulative
against the company over the alleged false revenue emanated from SDSB alone.
RM6.01 billion revenue figure was what BY SULHI KHALID & SHAZNI ONG
prompted the Attorney-General (AG) to theedgemarkets.com It also suggested that the matters raised
compound the company and its top exec- by KPMG and the FFU did not weigh on
utives, instead of pressing ahead with the only the fourth quarter’s consolidated the SC’s decision to draft the charges in
criminal charges against them. cumulative revenue of RM6.01 billion the way it was drafted.
was false but not that of the first, second
Serba shared its take on the matter in and third quarter figures, which “amply “The charges brought by the SC
a 26-page long bourse filing onThursday, demonstrates an internal irreconcilabil- against the company are peculiar in that
which it said “concerns” the Feb 7 High ity within the four corners of the charge it constitutes a complete departure from
Court order that compelled the company itself ”. the issues raised by KPMG and EYC,”
to reveal the factual findings update (FFU) it claimed, adding the three — KPMG,
that was prepared by Ernst &Young Con- “As a matter of logic, in order for the EYC and SC have different contentions.
sulting Sdn Bhd (EYC), which was ap- consolidated cumulative 4th quarter reve-
pointed to undertake a special independ- nue of RM6.014 billion to be false, the 1st, “KPMG’s main thrust is that they are
ent review on the group following audit 2nd and 3rd quarter revenues should also not able to accept or reconcile certain mat-
issues raised by KPMG. be false.This ought not to be viewed as a ters they have come across. KPMG then
mere mistake on the part of the SC but stopped work.
Serba, however, has been dragging its rather, a manifestation of a hasty action in
feet in complying with this order, which bad faith, to bring charges in furtherance “EYC’s findings suggest that they have
led to Bursa Malaysia Securities to initiate of an underlying improper purpose. It is come across many suspicious materials
contempt proceedings against the com- the SC who should explain why they had but are completely silent on how such
pany last Thursday (April 14). come to the conclusion that every item of suspicious materials translated into false
the revenue was false,” Serba said. revenue only. EYC in fact suggests that
Meanwhile, it believes the AG would they have found issues in both revenue
have taken into account several consider- It also suggested that its subsidiary Ser- and expense matters, across various years,
ations in arriving at its decision to com- ba Dinamik Sdn Bhd (SDSB) had been not only 2020. EYC then stopped work.
pound the company and its four execu-
tives, including the continued delay by the “It is necessary to view SC’s charges in
SC in producing documents to support its the light of the SC having access to KP-
allegations against those charged regarding MG’s complaint and EYC’s FFU, where
the false RM6.01 billion revenue figure. SC had chosen to focus only on consoli-
dated revenues of a very specific quarter,
It also said the SC had alleged that i.e. the cumulative 4th quarter for 2020,”
Serba said.

Serba Dinamik questions SC’s motive to press charges,
alleges SC threatened staff

KUALA LUMPUR (April 21): Serba BY SULHI KHALID revenue for the 1st, 2nd, 3rd and 4th
Dinamik Holdings Bhd has questioned theedgemarkets.com quarter of the 2020 financial year.
the Securities Commission Malaysia’s
(SC) motive to press charges against the ting false information to Bursa Malaysia, “It is therefore surprising that the SC
company in its lengthy reply to the court an offence under Section 369(a)(B) of does not allege that the revenue figures
order dated Feb 7, 2022. the Capital Markets and Services Act for the first, second and third quarters
2007 (CMSA). are false,” said Serba Dinamik.
The oil and gas service provider,
which is embroiled in audit issues, ar- SC also secured a warrant of arrest The group added, the SC has not
gued that the SC is obliged to prove that against the company’s chief executive of- shown how the entries in the account-
each and every director knew that the ficer and group managing director Datuk ing records of Serba Dinamik Sdn Bhd, a
statement was false and caused it to be Mohd Abdul Karim Abdullah. subsidiary of Serba Dinamik, could con-
announced as it believes that the way the tribute to the cumulative revenue figure
charges were framed was that the respon- Meanwhile, Serba Dinamik also ar- for the fourth quarter.
sibility for the alleged false statement gued that the SC should provide a docu-
rested on the (Serba Dinamik) board. ment that shows how entries amounting Serba Dinamik also alleged that the
to RM6.014 billion were entered into the SC had threatened the staff of the com-
“What is of course not explained in ledgers of the company and how such pany by offering them to become wit-
the press is the fact that the SC did not entries constitute false statements. nesses against the company and the
cause charges to be brought against the management.
entire board but only against selected “What is of course necessary is that Click here for the full story
directors and persons who were not di- the alleged false statement is specifically Read also: KPower proposes name
rectors.This is for SC to explain,” it said. the cumulative revenue figure in the an- change to Reneuco Click here
nouncement of the 4th quarter results,
To recap, in December last year, the being results for Dec 31, 2020.
SC pressed charges against Serba Dina-
mik’s directors and officers for submit- “The cumulative revenue figure for
the 4th quarter is a cumulation of the

FRIDAY APRIL 22, 2022 5 THEEDGE CEO MORNING BRIEF

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KUALA LUMPUR (April 21): Permoda- PNB plans to invest “As one of the country’s largest fund man-
lan Nasional Bhd (PNB) has plans to invest RM10 bil in green agement institutions with approximately 10%
a total of RM10 billion in green and tran- invested in domestic companies listed on the
sition assets by 2030 as part of its commit- and transition local bourse, PNB has a responsibility to nav-
ment to achieve a Net Zero Enterprise by assets by 2030 igate the complexities of the ESG journey.
2025 and Net Zero Portfolio by 2050, ac-
cording to the fund’s president and group BY SULHI KHALID “We believe that more can be achieved
chief executive Ahmad Zulqarnain Onn. theedgemarkets.com collectively and PNB will play a more active
role in advancing knowledge and a deeper un-
Speaking at a media briefing onThurs- as other stakeholders, and ultimately the derstanding of ESG, as well as its application
day (April 21) during the launch of its new millions of Malaysians who have entrusted and best practices for sustainability,” accord-
Sustainability Framework, Zulqarnain said their investments with us,” Zulqarnain said. ing to PNB’s chairmanTun Arifin Zakaria.
as a trusted custodian of Malaysian wealth
and assets, PNB has a responsibility to lead Meanwhile, in ensuring a success- He added that Corporate Malaysia has
and effect change to ensure an orderly and ful implementation of its Sustainability the responsibility to play an important role
just transition to a sustainable economy. Framework, PNB has established a com- in meeting the goal outlined in 12th Malay-
prehensive governance structure compris- sia Plan, which is to see Malaysia become
“At PNB, we will work hand-in-hand with ing a dedicated management committee carbon neutral by 2050.
our investee companies to develop value crea- reporting to the board of directors.
tion plans that will ensure sustainable growth The Sustainability Framework pulls to-
of their operational and financial performance. It also created two new functions, name- gether all that PNB has done over the years
ly the Investment Stewardship Division in diverse areas of sustainability into a clear
“There is tremendous pressure nowadays and Enterprise Sustainability Department and comprehensive framework.
for companies to not just perform financially, which are responsible for the overall im-
but also to integrate environmental,social and plementation of the framework. It outlines 10 commitments for PNB’s
governance (ESG) aspects into their business. own operations as well as for its investments
under the three pillars of ESG.
“We believe that, through our collec- Read also: PNB intends to elevate ESG
tive effort, this new way of doing business practices among portfolio companies
will create meaningful benefits for PNB, Click here
our investee companies, partners as well

KUALA LUMPUR (April 21): It ap- Boustead Naval gal proceedings against the company.
pears that stars have aligned for financial- Shipyard given The ad interim restraining order will
ly-stressed Boustead Naval Shipyard Sdn
Bhd (BNS), which has failed to deliver extension of not restrain or stay the continuation of
six littoral combat ships (LCS) to the restraining order legal proceedings brought by MTU Ser-
Royal Malaysian Navy under the RM9.1 vices and Ingat Kawan (M) Sdn Bhd.
billion contract awarded in 2011. until June 2
Since then, it is understood that other
BNS, a subsidiary of Boustead Hold- BY HAFIZ YATIM creditors have intervened in the ongoing
ings Bhd controlled by the Lembaga theedgemarkets.com court proceedings over the scheme of ar-
Tabung Angkatan Tentera, succeeded in rangement.
getting the High Court to extend the re- This is not the first time that the restraining
straining order until June 2, pursuant to a order was extended. In January, Chan granted The creditors include Contraves Sdn
scheme of arrangement and leave to hold a three-month extension of the restraining or- Bhd, Axima Concept SA, Contraves Ad-
the court-convened meeting up to June 2. der to BNS from Dec 2 last year to March 2. vanced Devices Sdn Bhd, Contraves
Electrodynamics Sdn Bhd andTyco Fire,
Judicial Commissioner Liza Chan Sow Prior to that, on June 2, 2021, she had Security & Services Malaysia Sdn Bhd,
Keng granted the extension, after the court granted BNS a three-month restraining or- as well as iXblue SAS, iXblue Sdn Bhd
took into account the Cabinet’s position to der and leave to proceed with a scheme of and Protank Mission Systems Sdn Bhd.
continue with the littoral combat ship project. arrangement with its creditors. That same
day, the court also granted a restraining or- Institutional creditors are Bank Pem-
To recap, the Cabinet, which met on der on proceedings against BNS or its assets bangunan Malaysia Bhd,AmBank Islam-
Wednesday and was chaired by Prime for three months after a winding-up peti- ic Bhd, AmBank (M) Bhd, Affin Hwang
Minister Datuk Seri Ismail SabriYaakob, tion by MTU Services (Malaysia) Sdn Bhd. Investment Bank Bhd, Bank Muamalat
unanimously agreed to proceed with the Malaysia Bhd, Affin Bank Bhd, Bank
project to procure the LCS. BNS’ financial stress mounted in July Kerjasama Rakyat Malaysia Bhd, Ma-
2020 following a winding-up petition filed layan Banking Bhd and Kuwait Finance
Senior Defence Minister Datuk Seri by MTU Services over an alleged debt of House (Malaysia) Bhd.
HishammuddinTun Hussein was quot- RM56.04 million. Read also:
ed by the media saying the decision was Cabinet unanimously agrees to proceed
made after taking into consideration two On March 29, 2021, the winding-up with littoral combat ships procurement
key factors, namely the LCS assets are petition was struck out. Prior to that, — Hishammuddin Click here
much needed by the Royal Malaysian BNS had in October 2020 obtained an
Navy (RMN) as well as there being 400 ad interim restraining order to restrain KL High Court grants Boustead
vendors involved in the project, with a fi- its scheme creditors from initiating le- Naval Shipyard a further three-month
nancial expenditure of over RM4 billion. extension of restraining order Click here

Lee Shih and Nathalie Ker from
Messrs Lim Chee Wee Partnership ap-
peared for Boustead Naval Shipyard.

FRIDAY APRIL 22, 2022 6 THEEDGE CEO MORNING BRIEF

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KUALA LUMPUR (April 21): Malay- Malaysia Airlines capacity to pre-pandemic level.
sia Airlines Bhd’s parent company Malay- parent company “Firefly has reinstated its jet operations
sia Aviation Group (MAG) reported on reports improved
Thursday (April 21) earnings before in- FY21 financial from new hub, Penang International Air-
terest, taxes, depreciation, and amortisa- port, starting April 11, 2022,” MAG said.
tion (EBITDA) of RM433 million for the performance
financial year ended Dec 31, 2021 (FY21) on successful Malaysian sovereign wealth fund Khaz-
from a loss before interest, taxes, deprecia- restructuring, cargo anah Nasional Bhd via MAG owns Ma-
tion, and amortisation of RM1.761 billion revenue growth laysia Airlines.
a year earlier on MAG’s successful restruc-
turing and cargo business revenue growth BY SYAFIQAH SALIM According to MAG’s website, MAG is
at a time when the global aviation industry theedgemarkets.com a global aviation organisation with three
continued to contend with the impact of focused business portfolios comprising air-
Covid-19-driven movement restrictions. passenger demand and sales contributing lines, aviation services besides e-commerce
to the group’s solid cash balance. and travel services businesses.
In a statement, MAG said its cargo busi-
ness arm MAB Kargo Sdn Bhd’s revenue MAG said cargo operations will contin- “Its current airlines business portfolio
grew 52% to RM3 billion in FY21 from ue to lead the aviation market as demand that serves the global, domestic and seg-
a year earlier. for cargo movement in the Asia-Pacific re- mented market comprises Malaysia Air-
gion is expected to grow 5%. lines — the national carrier of Malaysia,
“Despite lower passenger traffic and Firefly and MASwings — the regional
reduced capacity for Malaysia Airlines by “Malaysia Airlines and its sister air- airlines focused on serving communities
62% and 71% respectively in 2021, Ma- lines will gradually add capacity for across Malaysia, and AMAL by Malaysia
laysia Airlines recorded 57% higher yield both domestic and international routes, Airlines — [a] leading one-stop pilgrimage
in passenger revenue, assisted by its Airline expecting to achieve more than 70% travel solutions centre,” MAG said.
Revenue Maximisation Solution (ARMS)
which provides a complete and compre- In MAG’s statement, MAG said air-
hensive picture of an airline’s revenue and lines under the group flew 1.745 million
cost ecosystem, personalising fares and of- passengers in FY21 compared with 3.939
fers to customers at a willing-to-pay rate million a year earlier.
using predictive forecasting features.
Passenger load factor across MAG’s air-
“The restructuring the group (MAG) lines dropped to 46% from 63%, MAG
undertook in 2021 gave MAG the oppor- said.
tunity to holistically repair its balance sheet
and address decades-long legacy issues, re- “While the group’s (MAG) strong focus
sulting in a reduction in the group’s liabil- in 2021 remained on cost management,
ities of over RM15 billion, and eliminating its main airline business Malaysia Airlines
RM10 billion in debt. Lower operating cost continued to improve on its end-to-end
from its cost savings/avoidance initiatives customer experience and enhanced prod-
across the group as well as lower leasing uct offerings to recover and regain custom-
cost post its successful restructuring fur- er confidence in travelling quickly.
ther contributed to the improved perfor-
mance in 2021,” MAG said. “Firefly jet operations were disrupted
by the Covid-19 pandemic when domestic
With the gradual reopening of interna- travel remained restricted for the most part
tional borders, MAG said it is seeing strong of FY21. MASwings continued to maintain
most of its network schedule in FY21 to
support the rural air connectivity within
Sabah and Sarawak during the pandem-
ic,” MAG said.

Malaysia Aviation Group says Russia-Ukraine conflict raises
challenges in managing operating cost

KUALA LUMPUR (April 21): Malaysia BY SYAFIQAH SALIM It was reported on March 10, 2022
Airlines Bhd’s parent company Malaysia theedgemarkets.com that Malaysia Airlines had announced it
Aviation Group (MAG) said on Thurs- would impose a fuel surcharge on pas-
day (April 21, 2022) the Russia-Ukraine SHAHRIL BASRI/THE EDGE sengers and air cargo in selected markets
conflict has raised challenges in manag- from March 23, 2022 after global fuel
ing MAG’s operating cost, which is di- impact of higher fuel cost. Safety remains prices escalated.
rectly impacted by escalating fuel prices the top priority for the group and meas-
as global crude oil prices exceed US$100 ures have been taken to avoid the conflict “Following the escalating global fuel
a barrel (bbl). zone,” MAG said in a statement. price, Malaysia Airlines will be impos-
ing a fuel surcharge for passengers and
“Fuel price at current levels of air cargo in selected markets beginning
US$110/bbl to US$130/bbl makes up March 23.
to 40%-45% of the group’s (MAG) to-
tal operational cost, an increase of about “The airline is proactively manag-
35%-40% from a year ago. ing its capacity to mitigate unprofitable
routes due to rising fuel cost,” a Ma-
“All companies within the group have laysia Airlines spokesperson said when
taken immediate steps to manage the contacted by The Edge.

FRIDAY APRIL 22, 2022 7 THEEDGE CEO MORNING BRIEF

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Najib’s request to have 1MDB 2013 audit
signed was more like an ‘instruction’
— KPMG managing partner

KUALA LUMPUR (April 21): Former BY TARANI PALANI & HAFIZ YATIM board had told him they were “under pres-
prime minister Datuk Seri Najib Razak’s theedgemarkets.com sure by the shareholder” to resolve the issue.
request that the long-delayed 2013 finan-
cial statements of 1Malaysia Development He also told the High Court that KPMG “The management doesn’t know. The
Bhd (1MDB) be signed off was more like an had requested the information from 1MDB board doesn’t know (the details).They want
“instruction”,KPMG managing partner Da- since April 2013 before the Dec 15, 2013 us to sign (off the accounts)
tuk Johan Idris said onThursday (April 21). meeting.
“We have no alternative but to ask to see
Testifying as the 14th prosecution witness ‘Insufficient information to comply with the shareholder (Najib). So that is what we
in the 1MDB-Tanore trial, Johan referred international accounting standards’ did — to seek clarification if he knows an-
to a meeting on the night of Dec 15, 2013 During the Dec 15, 2013 meeting, Najib ything the board does not know,” he said.
with Najib over the US$2.3 billion in invest- queried Johan on why KPMG was still sus-
ments made through Brazen Sky Ltd in an picious about the underlying assets. Johan He reiterated that the firm was merely
unknown fund called Bridge Global SPC. said he would need evidence in accordance doing its job professionally when applying
He said the meeting was held with Najib with international auditing and financial international standards in valuing the assets.
in the latter’s capacity as finance minister standards and that KPMG would have to
as the Minister of Finance Inc was the sole add a disclaimer of opinion over 1MDB’s However, Shafee then zeroed in on the
shareholder of 1MDB. accounts if this was not provided. Dec 15 meeting and referred to the min-
utes Johan had taken himself. He tried to
“Before the meeting ended, Najib stated Najib also questioned why KPMG could establish that there was no pressure from
that he would like to see the 1MDB [2013] not rely on BSI Bank’s information as it was the former premier.
accounts signed [off] by KPMG on or be- the custodian bank of the investments, and
fore Dec 31, 2013, but I did not give any an international bank. Shafee: PM says he wants to have good
response to him,” said Johan when reading governance and it is fair for KPMG to have
his witness statement. Johan also said the information from the this information, and you also replied that
bank was incomplete, especially regarding the audit would say who owns the funds...
At this juncture, he was interjected by the underlying assets. PM directed 1MDB management in front
Deputy Public Prosecutor Deepa Nair of you, correct?
Thevaharan, who asked what Najib’s reac- Towards the end of the 45-minute meet-
tion was at that time. ing, Johan said, Najib asked KPMG to go to Johan: Correct.
Hong Kong to meet with BSI Bank, adding Shafee then asked if there was “any pres-
“It was like an ‘arahan’ (instruction) to KPMG was to complete the audit profes- sure” put by Najib in the instances that he
me,” Johan replied. sionally with good governance. had highlighted. Johan replied in the neg-
ative.
The witness explained that he went to Following the meeting and KPMG’s hes- Shafee: [Did the PM say] Johan if you
Najib’s residence in Jalan Langgak Duta itancy to sign off on the financial statements, don’t close you will be sacked?
with partner Foong Mun Kong and for- the audit firm received a letter from 1MDB Johan: [He said] we would like to see
mer KPMG managing partner Mohamed informing that its services as 1MDB’s external the accounts closed.
Raslan Abdul Rahman, but only Johan was auditor were to be terminated immediately. Shafee then asked if it would be fair for
allowed into the private residence. No reasons were given although KPMG was a shareholder to see a long overdue account
informed that Deloitte would be replacing it. closed by the date set.
Upon entering, Johan saw former 1MDB “Until the end he didn’t put pressure?”
chairmanTan Sri LodinWok Kamaruddin, In its reply via a letter dated Jan 6, 2014, asked Shafee.There was no audible answer
and former 1MDB chief executive officer KPMG enumerated the reasons why the fi- from Johan on this.
Mohd Hazem Ab Rahman and former nancial accounts could not be signed off. It Johan also said that neither he nor 1MDB
1MDB chief financial officer AzmiTahir. stated that it could not ascertain the value of engagement partner Ahmad Nasri Abdul
the investments as “reliable and appropriate” Wahab had met Low. He also said he was not
Johan added that KPMG wanted to ob- despite numerous requests for information aware that Low was “controlling” 1MDB.
tain “evidence on the existence, accuracy, regarding Brazen Sky’s investments in the Shafee: [Are you aware that he was] di-
completeness and valuation of the invest- Cayman Islands.The information given by recting management on how to cover the
ment” and to conduct an audit of the invest- BSI Bank was also inadequate as it failed to crime?
ments in Brazen Sky to complete the audit provide information on the underlying assets Johan: Not aware.
process as required under the International of the US$2.3 billion investments. Najib has been charged with four counts
Standard of Auditing and Financial Report- of abuse of power in enriching himself with
ing Standard. The US$2.3 billion investments in ques- RM2.3 billion of 1MDB funds and 21
tion were made via six promissory notes which counts of money laundering of the same
However, Najib informed Johan that he turned out to be “worthless pieces of paper”. amount. He could face a fine and up to 20
was aware of 1MDB’s investments in Bra- years’ imprisonment if convicted.
zen Sky and that 1MDB could not disclose ‘Board and management pressured by The trial continues on May 9.
specific details regarding the investments be- the shareholder’
cause they were considered as “confidential”. During cross-examination by Najib’s counsel
Tan Sri Muhammad Shafee Abdullah, Johan
“[But] I did not understand why 1MDB said that in 2013, the management and the
refused to disclose the information on the
underlying assets which were said to be con-
fidential,” Johan said in his witness statement.

FRIDAY APRIL 22, 2022 8 THEEDGE CEO MORNING BRIEF

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Ismee says Jho Low is 1MDB’s
‘hidden hand’, ex-CFO tells court

KUALA LUMPUR (April 21): Former BY HAFIZ YATIM & TARANI PALANI must seek consent to such payment.
1Malaysia Development Bhd (1MDB) theedgemarkets.com Azmi: The board authorises the CEO
chief financial officer (CFO) Azmi Tahir
told the High Court on Thursday (April As they won’t let me in, I texted Jho (Mohd Hazem Abd Rahman), when they
21) that he did refer to then board member Low about this and the door was opened. signed the director circular resolution
Tan Sri Ismee Ismail about LowTaek Jho’s That was an indication that he communi- (DCR).
instructions to the management. cated with someone in there.
Shafee: But there were questionable
Azmi, the 12th prosecution witness in Shafee: Is this possibly a phone call remittances made when you were CFO.
the 1MDB-Tanore trial, during cross-ex- to Najib?
amination by Datuk Seri Najib Razak’s Azmi: I duly authorised it due to the
lawyer Tan Sri Muhammad Shafee Ab- Azmi: That is the impression that I agreement (signed). I did not ask the
dullah, said he asked Ismee whether the have. board.
management can act on Low’s direction Board could be misled in the transfer
despite the latter not holding any official of funds Shafee: The board had been misled
post in the company. The witness added at no time did he con- and as a result the company suffered over
firm with Najib himself whether he should borrowed money — not one transaction
“Yes, I met Ismee and he told me that take instructions from Jho Low, as he “did but six transactions?
in all companies there are ‘hidden hands’ not think it was appropriate” to do so.
even in Lembaga Tabung Haji. In 1MDB Azmi: In hindsight, yes.
it is Jho Low,” he said. “This follows in a company where there Shafee: The remittance and losses
is certain protocol and decorum (to act in suffered is caused by the conduct of the
When asked by Shafee, Azmi agreed a certain way).We do not talk with them, management?
that his meeting with Ismee was not in an that was my feeling. I did not think it was Azmi: I disagree.
official board meeting. appropriate,” Azmi said.
2014 World Cup semi-final
The witness further agreed that Low, Shafee further asked Azmi about the Shafee — like his fellow counsel Wan Ai-
better known as Jho Low, giving instruc- huge overseas transfers of 1MDB funds zuddin Wan Muhammed on Wednesday
tions to the management was never raised which he conducted, to which the witness (April 20) — pressed Azmi on whether
with the 1MDB board, but that the board responded that he thought he was duly he had gone to the 2014 World Cup with
is aware. authorised to make the remittance. Jho Low, to which the former CFO con-
tinuously denied.
Azmi, 49, was continuously asked by Shafee: You are the CFO, you are to
the senior lawyer about 1MDB’s culture protect the company from any financial This time, Shafee went into specif-
of working in silo, and that he assumed misgivings? ics, alleging that Azmi was with Jho Low,
Jho Low’s instructions to him came from Hazem, and then 1MDB chief investment
then prime minister Najib. Azmi: Yes. officerVincent Koh at the 2014World Cup
Shafee: If you did not function well, semi-final match between Brazil and Ger-
The former CFO agreed that this was the company would suffer losses. many. However, Azmi denied this.
a presumption he had, and admitted he Azmi: Yes.
did not clarify this with Najib personally. Shafee: The board (of directors) is Shafee asked Azmi to bring his passport
the primary organ as they make seri- to court, and the witness said he will try
When Shafee claimed that what Azmi ous determination and the management and search for it.
had presumed could be regarded as hear-
say, the witness gave several instances he However, unlike Wednesday, the wit-
thought supported his presumption. ness did not consent to the defence doing
a search with the immigration department
Azmi said Datuk Azlin Alias (Najib’s over the purported Brazil trip, but said if
late principal private secretary) had in- it is limited to the 2014World Cup series,
formed him in a meeting that Low was they can.
acting for Najib.
The witness also admitted that he also
The second instance was when Azmi watched a Formula 1 race in Abu Dhabi
was required to bring articles from The at the invitation one Mohamed Badawy
Edge which were critical of 1MDB. Al-Husseiny. Badawy is former CEO of
IPIC unit Aabar Investments PJS — and
He explained to the court that Jho Low also CEO of the fake Aabar firm which
had wanted him to come to Abu Dhabi or received US$699.32 million from 1MDB
Dubai with those articles to meet Najib as that later went missing.
the former premier was considering taking
action against The Edge. The trial continues with Datuk Johan
Idris, the managing partner of KPMG —
Azmi: When I arrived at the hotel in one of 1MDB’s former external auditors
Abu Dhabi, I informed Jho Low I had — testifying before presiding judge Datuk
arrived, and he told me to go to a certain Collin Lawrence Sequerah.
floor. I approached the floor and saw two
Malaysian bodyguards outside the door Najib is facing four counts of abuse of
and I told them who I was. power and 21 counts of money laundering
involving a total of RM2.28 billion.

FRIDAY APRIL 22, 2022 9 THEEDGE CEO MORNING BRIEF

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KUALA LUMPUR (April 21): Sime Dar- Sime Darby ask for documentation and that is a pro-
by Plantation Bhd (SDP) expects to deliver Plantation to cess that you need to go through,” she said.
its impact report submission to the Unit- submit impact
ed States Customs and Border Protection report to US Renaka added that there was little com-
(CBP) — which will go towards lifting the CBP by end- munication between SDP and US CBP
Withhold Release Order (WRO) imposed prior to the imposition of the WRO.
on the company since December 2020 — April
by the end of this month. “After theWRO was imposed, the CBP’s
BY SHAZNI ONG view was that we should get the assessments
SDP group managing director Moham- theedgemarkets.com done, submit it.
ad Helmy Othman Basha admitted that the
group missed its original targeted timeline ing been slapped with the WRO and its “And obviously post-finding, we had a
to submit the report, which was previously findings — so we have to lead the way and few engagements and post the submission
set for the end of the first quarter of 2022. solve this problem.We hope that us making again, the messaging was more or less the
the changes will also move the plantation same, whereby we need to get the submis-
“It is delayed but I am happy to say that industry to change and maybe other in- sion done and of course post-submission,
we are ready to submit it by the end of April. dustries too,” he said. there will be a lot more engagements ob-
We have also made a few announcements on viously,” she said.
the works, given the delay due to Covid, as all SDP chief financial officer Renaka Ra-
the works involved had to be done physically, machandran, who was also present, con- “And obviously [after theWRO was im-
like the assessments whereby our people and curred, further saying that the CBP does posed], we had a few engagements. The
the assessors had to travel. not give any guidelines, instructions or in- messaging was more or less the same, [that]
dications of how the order would be lifted. needed to get the submission done.There
“Otherwise, it would have been com- will be a lot more engagements,” she said.
pleted earlier and we could have submitted “It is basically getting the assessments
faster,” he said at a Zoom webinar titled done and reporting the current conditions Prior to this, aWRO was issued to SDP
“Ban (Findings) Issued by the US CBP on whether there are ILO indicators on the on Dec 16, 2020, which gives an import-
on Sime Darby Plantation — Sharing Our ground. They will review it and they will er up to three months to prove that there
Experience” which was hosted by the Ma- revert if they have got questions.They may are no indications of forced labour, and is
laysian Palm Oil Council. even given an option to re-export the goods
brought into the US.
Mohamed Helmy said the last 12
months have been an enriching experi- The WRO issued in Dec 2020 was for
ence, with many lessons learned. palm oil, including all crude palm oil and
palm kernel oil and derivative products,
He highlighted that the International made wholly or in part with palm oil trace-
Labour Organization’s (ILO) 11 forced la- able to SDP.
bour indicators do not clearly define what
each indicator means. Despite SDP’s cooperation with the
CBP, the plantation group was issued a
“It is a journey for us and I believe it notice of finding — which enables the US
is a journey for Impactt Ltd too, because authorities to seize the importer’s goods
this is the first time they are working with upon entry into the US — on Jan 27, 2022.
or advising a plantation company. Having
said that, learning what we have learned SDP shares closed nine sen or 1.69%
for the past 12 months, I do not think any lower at RM5.25 onThursday (April 21),
society, be it a developed society or other- giving the plantation group a market cap-
wise, is free of all the 11 ILO indicators. italisation of RM36.31 billion.
Read also: No standards on what the re-
“However, the issue that we are talking mediation fees should comprise of, says
about is very specific to us. Hence, we are Sime Darby Plantation Click here
the ones that have to deal with it — hav-

ILO, US Embassy urged to notify HR Ministry of forced labour probes

PUTRAJAYA (April 21): The Inter- Bernama and the US Embassy so that any in-
national Labour Organisation (ILO) vestigation by the US should be noti-
and the United States Embassy in and Border Protection (CBP) due to fied to us, otherwise we will not find
Malaysia have been asked to notify allegations of forced labour, although solutions,” he said.
the Human Resources Ministry of the Ministry has yet to receive any re-
any investigation of forced labour so ports from the US on them. Saravanan was speaking to report-
that solutions can be found before ers after officiating at the handover of
Malaysian products are blocked from “This has made it difficult for us to the 2022 Central Zone Trade Union
entering the US. act against the employers. Development Grant (GPKS) and the
launch of a book on local trade union
Human Resources Minister Datuk “We have conducted investigations issues here on Thursday.
Seri M Saravanan said several Malay- according to 11 existing forced labour Click here for the full story
sian products had been subjected to indicators outlined by the ILO but
export restrictions by the US Customs were unable to detect any wrongdo-
ing, so (we) have met with the ILO

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KUALA LUMPUR (April 21): Petronas Russia-Ukraine make announcements upon confirmation.
Chemicals Group Bhd (PetChem) expects conflict’s impact Separately in a statement, PetChem said
the volatility in feedstock prices caused by on feedstock prices
the Russian-Ukraine conflict to moderate is not a norm and it has strengthened its growth prospects
in the near term. will stabilise — and presence in the Southeast Asian region
PetChem MD as a key silicone manufacturer through its
“As you can see what the conflict does is 2019-acquired wholly-owned subsidiary,
that it has created some instability in the feed- BY SEAH EU HEN BRB international, which began operating
stock prices, especially gas. In the first quarter theedgemarkets.com its new 8,000 metric tonnes annual capac-
[of 2021], the products derived from gas, for ity silicone blending facility in Gebeng,
example urea, [saw their prices skyrocket]. SHAHRIN YAHYA/THE EDGE Pahang in December 2021.

“So we believe that the situation would Mohd Yusri Mohamed Yusof “Additionally, PetChem recently
be temporary… while we are benefitting achieved final investment decision to build
from the situation currently, we do not Meanwhile,Yusri said that PetChem has a melamine plant in Gurun, Kedah, poten-
think that the situation will be a norm and identified and is working diligently on several tially making PetChem the sole melamine
would stabilise over a period,” PetChem’s targets for mergers and acquisition in 2022 producer in Southeast Asia.
managing director (MD) and chief execu- and the petrochemicals group expects to
tive officer, MohdYusri MohamedYusof, “Our Pengerang Integrated Complex
said at the group’s annual general meeting (PIC), which is now in the final stages of
(AGM) on Thursday (April 21). start-up readiness, provides another platform
to strengthen our position in both basic and
Yusri also said that the group believes specialty chemicals.We expect to commence
that China — a 16% revenue contributor start-up in the second quarter of 2022.With
in 2021 according to its 2021 annual re- PIC, we will increase our production capacity
port — will continue to remain as its key from 12.8 million up to 14.6 million tonne per
market in 2022 amid a potential economic annum,”Yusri highlighted in the statement.
slowdown in the most populous country
in the world due to the pandemic. At the time of writing, PetChem shares
were trading 12 sen or 1.17% higher at
“We expect China’s economic growth to be RM10.42 apiece, valuing the petrochemi-
around 8% or so.We believe that the demand cals group at RM83.36 billion.Year to date,
is still going to be there. If you talk from the the counter has appreciated by RM1.66
perspective of the Covid-19 lockdowns that or 18.95% from RM8.76.
are happening [in China] now, we are manag- Read also: PetChem MD: Sustainabili-
ing that through distributing to other ports and ty strategy making good progress amid
also to channel some of the products to other record-breaking performance in 2021
areas that are not affected,”Yusri highlighted. Click here

All resolutions presented at the AGM
were also approved by its shareholders.

KUALA LUMPUR (April 21): Malaysia MAHB saw “We are expecting a further increase
Airports Holdings Bhd (MAHB) said its na- 52% monthly to this number once Kota Kinabalu In-
tionwide airport network recorded a 52% in- increase in March ternational Airport (BKI) begins to re-
crease in international passenger movements international ceive international passengers this month.
to 420,000 in March from February, driven traffic thanks to Prior to the [Covid-19] pandemic, BKI
by the implementation of variousVaccinated border reopening was our third busiest airport for inter-
Travel Lane (VTL) programmes. national traffic with an average of 8,460
BY SYAFIQAH SALIM international passenger movements per
In a Thursday statement, MAHB said theedgemarkets.com day,” he added.
VTL programmes were implemented
between Kuala Lumpur and Singapore, galore, Mumbai, Chennai and Hyderabad Last month, MAHB recorded a total of
Bangkok, Phuket and Phnom Penh, and — in March, it noted. 5.31 million passenger movements with its
between Penang and Singapore. local airports in Malaysia serving 57% or
MAHB managing director Datuk Iskan- 3.03 million passengers.
MAHB said that on March 28, Kuala dar Mizal Mahmood said the group is en-
Lumpur International Airport welcomed a couraged by the gradual increase in inter- ItsTurkish asset, Istanbul Sabiha Gok-
new international airline,Air India Express, national passenger traffic at its local airports cen International Airport, served a total of
which flies three times a week fromTiruchi- with the reopening of the borders on April 1. 2.29 million passengers with 1.15 million
rappalli International Airport inTamil Nadu, international and 1.14 million domestic
India. “It is the only foreign carrier with a “Since then, we have been recording passengers respectively.
scheduled service between Tiruchirappalli a daily average of 20,000 international
and Kuala Lumpur,” said MAHB. movements. “For Malaysia, the overall passenger
movements increased by 19% in March
Meanwhile, MAHB’s partner airlines from February. Its domestic passenger traf-
have also resumed other international fic movements also increased by 15% at
routes, such as Malaysia Airlines and Ma- 2.61 million passengers from the previous
lindo Air, flying to Perth after Australia’s month,” MAHB added.
borders reopened on March 3, MAHB said.
At the time of writing, MAHB shares
Malaysia Airlines also resumed flights rose three sen or 0.45% to RM6.77, with a
to five cities in India — New Delhi, Ban- market capitalisation of RM11.23 billion.

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KUALA LUMPUR (April 21): UOBKay- UOBKayhian per site, the acquisition appears to be in line
Hian Research on Thursday downgraded downgrades Axiata with industry standards in the Philippines.
Axiata Group Bhd to “hold” from “buy” to ‘hold’ on near- According to them, post-acquisition,
and lowered the stock’s target price to term earnings Axiata’s gross debt/EBITDA will rise from
RM4 from RM4.45 as it sees the group’s dilution from 2.56 times to 2.87 times.
subsidiary edotco Group Sdn Bhd’s Phil-
ippines telecoms towers’ acquisition to be “We expect share price to retrace due to
earnings dilutive in the near term. the long gestation period of this pricey ac-
quisition (to Axiata — which trades at four
The research house’s analysts Chong times EV/EBITDA). As such, we believe a
Lee Len and Chloe Tan JieYing said in a edotco’s tower buy natural progression for edotco is a separate
note that the acquisition is dilutive to Axi- listing as future acquisitions will continue to
ata and their earnings sensitivity suggested be dilutive to the enlarged group,” they said.
12% and 10% earnings downgrades for They also believed a separate listing of the
2022 and 2023 respectively. edotco is a key rerating catalyst for the stock.
BY TAN SIEW MUNG
Axiata announced onWednesday that its
63%-owned subsidiary edotco’s 100%-owned theedgemarkets.com “Post transaction,edotco will own and man-
unit ISOC edotco Towers Inc was buying
2,973 telecommunications towers and re- age a total of around 54,000 passive towers in
lated assets in the Philippines from PLDT the region, becoming the sixth largest towerco
Group units Smart Communications Inc and Axiata Consensus Rating globally.We opine that this will pave the way
Digitel Mobile Philippines Inc for 42 billion
Philippine pesos (RM3.42 billion) in a move for the potential listing of edotco,” they said.
that would help the buyer establish a platform Broker Rating Target At the time of writing, Axiata dropped
to accelerate organic and inorganic growth. Price by seven sen or 1.9% to RM3.62, valuing
(RM) the group at RM33.04 billion.
“The deal is earnings dilutive to Axiata
and management only expects the acqui- CGS-CIMB Add 4.20 Over the past one year, the counter has
sition to be earnings accretive in year six. tumbled 4.99%.
We estimate RM150 million in earnings DBS Bank Buy 4.65
dilution after factoring in cost of debt to
fund the acquisition,” said Chong andTan. HSBC Buy 4.45

The duo also said that based on Axiata’s JP Morgan Neutral 3.90 More on brokers calls:
guidance, the acquisition is priced at low to KAF Equities
mid-teen enterprise value to earnings before Hold 4.14
interest, taxes, depreciation, and amortisation
(EV/EBITDA) ratio, and at US$270,000 Maybank Buy 4.70 Telecoms towers’ acquisition to increase
Investment Bank Outperform 4.90 edotco’s footprint in emerging markets
— Public Investment Click here
Macquarie

New Street Research Buy 5.70

Nomura Buy 5.18 AmInvestment Bank downgrades YTL
UOBKayHian Hold 4.00 Hospitality REIT to ‘hold’ with lower
fair value of RM1.01 Click here
Source: Bloomberg

KUALA LUMPUR (April 21): RHB Re- RHB Research To recall, S P Setia announced the dis-
search onThursday (April 21) upgraded S upgrades S P Setia posal of 959.7 acres of land in Johor to Sci-
P Setia Bhd to “buy” from “neutral” and re- to ‘buy’, raises target entex Bhd in May last year for RM518.1
vised up the stock’s target price to RM1.48 million. The land sale, which is expected
from RM1.28 as it foresees the group’s fi- price to RM1.48 to be completed in phases, is now pending
nancial position to gradually improve from Economic Planning Unit’s (EPU) approvals.
the second half of the year (2H22) onwards. BY TAN SIEW MUNG
theedgemarkets.com At the same time, the management is also
The research house’s analyst Loong Kok in talks with some corporates and a logistic
Wen said in a note that degearing is now RCPS-i B (worth RM1.04 billion) on Dec player to potentially sell some commercial
management’s top priority, and she believes 22 after the fifth year anniversary, by re-fi- land plots in Setia Alam Impian, Loong said.
the handover of a few projects in Melbourne nancing it.
and Singapore, as well as the potential com- While there are no plans to add more
pletion of some land disposals, will help re- The current coupon rate for this tranche is land in Malaysia, Loong said the manage-
duce the group’s net gearing to 0.51 times to at 5.93% and, in her view, the company is at ment is looking to replenish its landbank in
0.53 times by year end from the current 0.61 an advantage to ride on the current low inter- Melbourne, given that the existing projects
times (including non-controlling interests). est rate cycle to re-finance it at a lower rate. there will be completed this year.

Loong recently had a meeting with the “If this materialises, it should help to re- “We are not concerned over the potential
company’s head of IR who indicated the duce S P Setia’s total preferential dividend funding as the accumulated profits generated
completion of Sapphire and UNO in Mel- payment to both RCPS-i which amounted in all S P Setia’s past projects in Melbourne
bourne in the third quarter of 2022 (3Q22), to RM130 million per annum,” she said. should help to finance the new land,” she said.
as well as Daintree Residence in Singapore in
4Q22, should help to pare down RM1.5 bil- Meanwhile,Loong said the continuous sale Loong also said the slower property sales
lion to RM1.6 billion in debt from the com- of non-core landbank, as well as strategic plots in the first quarter is generally within expec-
pany’s total borrowings of RM12.6 billion. within its township developments, should help tation, and she believes S P Setia should be
to pare down S P Setia’s gearing further and on track to hit its RM4 billion sales target on
According to her, there is also an expecta- accelerate value unlocking of its landbank. the back of RM4.25 billion worth of launch-
tion for earnings to be more lumpy in 2H22. es, of which 65% is landed properties.

Citing S P Setia’s management, she said At the time of writing, S P Setia rose
the company may redeem the existing Islam- one sen or 0.82% to RM1.23, valuing the
ic redeemable convertible preference shares group at RM5 billion. Over the past one
year, the counter has risen 17.14%.

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KUALA LUMPUR (April 21): CIMB Group CIMBThai’s “Deposits (inclusive of bills of exchange, de-
Holdings Bhd’s 94.83%-owned subsidiary January-March bentures and selected structured deposit prod-
CIMBThai Bank PCL saw its net profit jump 2022 profit soars on ucts) stood at 252.5 billion baht, an increase
719.7 million baht or 211% year-on-year better cost control of 5.4% from 239.5 billion baht as at end of
(y-o-y) for the three months ended March 31, December 2021.The modified loan-to-depos-
2022 (3MFY22) to 1.06 billion baht. BY SYAFIQAH SALIM it ratio decreased to 85.2% from 88.5 % as at
theedgemarkets.com Dec 31, 2021.
The improvement came mainly due to a bet-
ter cost control, with a 14% drop in operating progress in its overall performance despite the “The gross non-performing loans (NPLs)
expenses and a 64% decline in expected cred- uncertain recovery surrounding the Covid-19 stood at 8.4 billion baht, with a higher gross NPL
it losses, CIMBThai said in a statement.This pandemic, driven by the group’s cost discipline ratio of 3.8% from 3.7% as at Dec 31, 2021 due
improved the cost-to-income ratio to 51.4% in and improved asset quality,Wong said. to the sale of NPLs in 2021. CIMB Thai con-
3MFY22 compared with 59.3% in 3MFY21. tinues to exercise high credit risk underwriting
“We also saw positive growth momentum standards and risk management policies. The
This came despite a marginal drop of 0.8% in 1Q22. CIMB Thai’s 2022 strategy is to re- bank will also continue to focus on improving
in operating income to 3.48 billion baht from main focused on driving sustainable financial productivity,monitoring collection and managing
3.51 million baht a year earlier, due to a 152.9 solutions and personalised services through all accounts closely and effectively,”Wong said.
million baht or 6.2% drop in net interest in- its key business drivers — consumer banking,
come because of lower interest income on loans wholesale banking and treasury and markets, Meanwhile, CIMB Thai Group’s loan loss
and hire purchase business, as well as a drop in while leveraging its ASEAN network and dig- coverage ratio as at March 31, 2022 grew to
net fee and service income from higher fee and ital platforms,”Wong added. 112% from 117.5% at the end of December
service expenses.This crimped the bank’s net 2021, while total allowance for expected credit
interest margin over earning assets to 2.8% in As at March 31, 2022, CIMBThai Group’s losses stood at 8.6 billion baht, 1.5 billion baht
3MFY22 from 3.1% in 3MFY21. total gross loans — inclusive of loans guaran- over the Bank ofThailand’s reserve requirements.
teed by other banks and loans to financial in-
The decline was partially offset by an in- stitutions — stood at 215 billion baht, up 1.5% The bank’s total consolidated capital funds
crease in other operating income by 153.1 mil- from Dec 31, 2021. as at March 31, 2022 stood at 53.6 billion baht.
lion baht or 24.1% due to an increase in gains Its BIS ratio stood at 21.9%, of which 15.9%
on financial instruments measured at fair value comprised Tier-1-capital.
through profit or loss, and other income, ac-
cording to CIMB Thai’s president and chief At the time of writing on Thursday (April
executive officer PaulWong Chee Kin. 21), CIMB shares were up 10 sen or 1.96%
to RM5.19, giving the bank a market capital-
But CIMBThai Group made considerable isation of RM53.05 billion.

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F R I D A Y A P R I L 2 2 , 2 0 2 2 14 T H E E D G E C E O M O R N I N G B R I E F

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KUALA LUMPUR (April 21): Holders E&O unit’s project at the north-east coast of Tanjung
of tranche one of Eastern & Oriental Bhd’s special resolution Tokong in Penang.
(E&O) subsidiary Tanjung Pinang Devel- rejected by Islamic
opment Sdn Bhd’s RM1.5 billion Islamic The first phase (STP1) of the reclama-
bonds or sukuk have rejected a special res- bondholders tion comprising 240 acres (96ha) was com-
olution proposed byTanjung Pinang Devel- under RM1.5 bil pleted in 2006, according to the company.
opment in December 2021, according to the
bond’s facilitating agent RHB Investment scheme Reclamation of the 760 acres under the
Bank Bhd onThursday (April 21, 2022). second phase (STP2) which commenced
BY CHONG JIN HUN in 2016 is underway, according toTanjung
“We refer to our announcement dated theedgemarkets.com Pinang Development.
Dec 10, 2021. Please be informed that
the special resolution circulated on Dec “As a matter of background, 20 acres
9, 2021 was rejected by the sukukholders within the 240-acre STP1 were surren-
of tranche 1 [of the RM1.5 billion Islamic dered to the Penang state government for
bonds],” RHB said in a filing with Bank the Penang Outer Ring Road (PORR)
Negara Malaysia’s Fully Automated Sys- alignment.These 20 acres will be replaced
tem for Issuing/Tendering (FAST) website. in STP2 and hence, the original acreage of
STP2 (740 acres as per concession agree-
RHB, however, did not specify details ment) has been increased to 760 acres.
of the special resolution.
“Over and above the concession rights to
According to Tanjung Pinang Devel- reclaim the land for STP,Tanjung Pinang
opment’s website, the company holds the Development is also reclaiming at its own
concession rights to both phases of the cost, 131 acres off the Gurney Drive fore-
Seri Tanjung Pinang (STP) reclamation shore for the Penang state government,”
Tanjung Pinang Development said.

NEWS IN BRIEF

Tomei’s precious metals arm YXPM Lee Han Ming steps down as Taliworks completes four solar
inks IPO underwriting pact with Tropicana CEO projects acquisition
Public Investment Bank
KUALA LUMPUR (April 21): Tomei KUALA LUMPUR (April 21): Tropicana KUALA LUMPUR (April 21): Taliworks
Consolidated Bhd’s wholly-owned precious Corp Bhd announced that Lee Han Ming Corporation Bhd on Thursday (April 21)
metals arm YX Precious Metals Bhd (YXPM), will step down as its chief executive officer completed the acquisition of majority
en route to list on the ACE Market of Bursa (CEO), effective May 1, 14 months after economic interest in four solar projects from
Malaysia by the end of June, has signed he took over the post. Tropicana said in a TerraForm Global Operating LP (TerraForm
an underwriting agreement with Public bourse filing that 55-year-old Lee would Global) and several of its subsidiaries. In a
Investment Bank Bhd in conjunction with resume a new assignment and position statement, the infrastructure company said
its upcoming initial public offering (IPO). to focus on and expand group property the solar projects, located within the vicinity of
Public Investment Bank is the principal development. According to the filing, Lee the Kuala Lumpur International Airport, have
adviser, sponsor, sole underwriter and sole currently holds 26,892 ordinary shares an aggregate capacity of 19-megawatt peak.
placement agent for the IPO exercise. The (direct interest) in the company. Lee, who The group will also be acquiring TerraForm
IPO exercise entails a public issue of 111.65 joined Tropicana in 2018 as the group Global Operating (Malaysia) Sdn Bhd, an
million new shares in YXPM, Tomei said in managing director of the project division, operations and maintenance services provider
a filing with Bursa Malaysia on Thursday was promoted as the group’s CEO on Feb of the solar project, as part of the transaction.
(April 21). Under the agreement, Public 4, 2021. — by Tan Siew Mung “Our maiden acquisition will provide Taliworks
Investment Bank will underwrite 48.38 with a solid platform to further expand into
million shares as part of the proposed public other renewable energy projects. Additionally,
issue of the IPO. — by Syafiqah Salim the four solar projects will immediately
serve as a reliable contributor to the group’s
Read also: ACE Market-bond SFPTech earnings and cashflow, as the projects are fully
inks underwriting pact with Public In- backed by renewable energy power purchase
vestment Bank Click here agreements with investment grade off-takers,”
said Taliworks executive director Datuk
Ronnie Lim Yew Boon. — by Sulhi Khalid

Kawan Food buys land in Selangor to build second manufacturing facility

KUALA LUMPUR (April 21): Convenience food manufacturer Kawan Food Bhd is buying five parcels of land measuring 7.08 acres in Shah Alam,
Selangor for a total of RM50.46 million, as part of its expansion plans. Kawan Food said it intends to build a second manufacturing facility for
its operations on the proposed site. It plans to expand its cold room facility to include a warehouse and cold chain distribution for in-house and
external products, equipped with new technology such as robotic automated warehouse to cater for frozen, chilled and ambient food products.
“This would enable Kawan Food to explore new ideas and growing product diversity for new markets. Also, with the strategic location in Shah
Alam, there is potential reduction in logistic cost for deliveries in local market,” it said in a bourse filing. It is buying the lands from RGP Warehouse
Solutions Sdn Bhd (three plots measuring 4.07 acres for RM28.94 million) and Perbadanan Kemajuan Negeri Selangor (two plots measuring 3.01
acres for RM21.52 million). The group will finance the acquisition through internal funds and/or borrowings. — theedgemarkets.com

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Apex court dismisses NFCorp’s appeal
on defamation suit against Rafizi

THE EDGE FILE PHOTO

BY IZZUL IKRAM
theedgemarkets.com

KUALA LUMPUR (April 21):The Feder- Datuk Seri Mohamed Salleh Ismail (left) and Rafizi Ramli.
al Court dismissed an appeal by the Nation-
al Feedlot Corp Sdn Bhd (NFCorp) and based on facts, and the comment was one been misused as leverage for the Public
its chairman Datuk Seri Mohamed Salleh a fair-minded person could make on the Bank loan was an opinion and inference
Ismail in their defamation suit against PKR facts proved. that a “fair-minded person would have
vice-president Rafizi Ramli.This is regard- honestly made in the circumstances”.
ing Rafizi’s statement in a 2012 press con- Addressing whether the comment re-
ference, which alleged that NFCorp and garded a matter of public interest, Azahar “In light of the above, all the four ele-
Salleh had used a RM250 million govern- said that he agreed that Rafizi’s comment ments of fair comment as laid down had
ment loan as collateral to purchase com- concerned a matter of public interest and been established.Therefore the respond-
mercial properties in KL Eco City. noted that there was no disagreement on ent could not be liable for damages for
this as both parties did not address this defamation,” he added.
OnThursday (April 21), a three-mem- issue to the court.
ber bench of the apex court, led by Chief NFCorp and Salleh filed the defama-
Judge of MalayaTan Sri Azahar Mohamed, Subsequently, he said that based on the tion suit against Rafizi following the former
dismissed the appeal and ordered costs of way Rafizi’s statement was “expressed, the Pandan member of parliament’s press con-
RM70,000 to be awarded to Rafizi. context it was set out, and the contents of ference in 2012, during which he alleged
the entire statement would regard them as the company had used a RM250 million
Azahar ruled that Rafizi had successful- the respondent’s (Rafizi) comments and government loan as collateral to purchase
ly established that the statement he made inferences made from the facts”. commercial properties in KL Eco City.
was a fair comment and added that Rafizi,
therefore, could not be liable for damages “A key point to note is that the im- In October 2016, the High Court found
for defamation. pugned statement did not single out an Rafizi guilty of defaming Salleh and NF-
action nor independently alleging particular Corp and ordered him to pay RM150,000
“In all the above circumstances, this conduct of the appellants per se,” he add- in damages to the first and RM50,000 to
appeal must be dismissed. I agree with the ed, noting that it was apparent that Rafi- the latter.
order of the Court of Appeal, though on zi made inferences of misappropriation of
substantially different grounds.We award public funds derived upon modus operandi. However, a three-member Court of Ap-
costs in the sum of RM70,000 to the re- peal bench led by Justice Datuk Dr Hamid
spondent (Rafizi),” he said. Meanwhile, Azahar said the facts re- Sultan Abu Backer then ruled on May 13,
ferred to in the statement — NFCorp and 2019 that Rafizi’s appeal had merits and
Azahar added that the decision was Salleh’s fixed deposits and bank loans — ordered the damages and RM100,000 in
unanimous as he noted that Justices Da- were not disputed, adding that they con- costs paid by Rafizi to Salleh and NFCorp
tuk Zabariah Yusof and Puan Seri Zale- stituted a “sufficient substratum of facts” previously be returned. In addition, Rafizi
ha Yusof, who joined him on the Federal to which Rafizi made the conclusions in was also awarded costs of RM110,000.
Court bench, agreed with his judgement. his statement.
On Sept 24, 2020, the Federal Court
“Justices Zabariah and Zaleha have read Hence, Azahar said that based on the granted leave to NFCorp and Salleh to
my judgement in draft and have expressed sufficient substratum of facts indicated, appeal the Court of Appeal’s decision to
their agreement with it, and have agreed Rafizi’s conclusion that public funds had dismiss the defamation suit.
to adopt the same as the judgement of this
court,” Azahar said.

Judge says Rafizi’s statement a
‘fair comment’
In delivering his judgement, Azahar noted
that the crux of the appeal regarded wheth-
er Rafizi could defend his statement on the
grounds of fair comment.

“Going from arguments raised by both
sides, the fundamental issue for our de-
termination was whether the respondent
could rely on the defence of fair comment
to defeat the appellants’ (NFCorp and
Salleh) claim,” he said.

The chief judge elaborated that for Rafi-
zi to succeed in his defence of fair com-
ment, he would have to establish four el-
ements, namely that his statement was a
comment, the comment was on a mat-
ter of public interest, the comment was

F R I D A Y A P R I L 2 2 , 2 0 2 2 16 T H E E D G E C E O M O R N I N G B R I E F

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BANDAR BAHARU (April 21): Police Cops identify KENNY YAP/THE EDGE
have identified the main culprit suspected main culprit
of inciting the riot that triggered the break- behind depot Former chief
out involving hundreds of Rohingyas at secretary to the
the Sungai Bakap Immigration Depot on breakout governmentTan
Wednesday (April 20). Sri Dr Ali Hamsa
Bernama
Kedah Criminal Investigation Depart- passes away
ment chief Datuk G Suresh Kumar said the with the camp management,” he said.
man, in his 30s, is a detainee at the camp Meanwhile, Bandar Baharu district po- Bernama
and police believe he was the “mastermind”
who may have incited the detainees to riot. lice chief DSP Mohd Akmal Hizam Abd KUALA LUMPUR (April 21): Former
Khupur has given the assurance that the chief secretary to the governmentTan Sri
“This man remains at large and search district and its surroundings were safe, de- Dr Ali Hamsa passed away onThursday
efforts are ongoing,” he told reporters at the spite many detainees still on the loose. at the Dublin Hospital in Ireland.
district police headquarters here onThurs-
day (April 21). He said 14 police teams with a strength This was confirmed by Chief Secre-
of 350 personnel, including the General Op- tary to the Government Tan Sri Mohd
Suresh said as ofWednesday night, some erations Force (GOF) have been mobilised Zuki Ali in a statement on Thursday.
200 of the Rohingya detainees have been to track down the fugitives.
questioned. In describing Ali as an eminent figure
“For now, we are focusing on Ban- in the country’s public service, Mohd
Over 20 personnel from the Immigra- dar Baru town, Relau and Lubok Bun- Zuki said Ali served in various minis-
tion Department and the People’sVolunteer tar, each covering a two-kilometre radius tries and government departments since
Corps (Rela) who were on duty during the search range. starting his service in the Administrative
breakout were called in onThursday to re- and Diplomatic Service in 1981.
cord their statements as well, he said. “Some of the escapees were found on
roadsides and we believe there are some They included the Ministry of Inter-
“So far, what we know is that the es- who are hiding in bushes with no idea nationalTrade and Industry, the Minis-
capees only wanted their freedom and where to go,” he said. try ofTransport, the Economic Planning
it was not because they were unhappy Unit, the National Institute of Public
Mohd Akmal Hizam also advised resi- Administration, the Public Service De-
BERNAMA dents not to act on their own if they happen partment, and the Public Private Part-
to come across the escapees, and instead im- nership Unit in the Prime Minister’s
Two people believed to be Rohingya detainees mediately contact the nearest police station. Department.
who escaped from the Sungai Bakap Immigration
Depot on Wednesday, April 20, 2021, is seen in an In the 4.30am incident on Wednesday, “Indeed, his passing in this glorious
Immigration Dept vehicle in Bandar Baharu, Kedah 528 Rohingya detainees escaped from the month of Ramadan is a great loss to the
in this picture taken on Thursday, April 21, 2022. depot, following a riot. nation and the civil service.

Six of them died after being hit by vehi- “May Allah SWT bless and place him
cles on the North-South Expressway, while among the believers,” he said.
130 detainees, comprising 99 men, 21 wom-
en, five boys and five girls are still on the run. Ali, from Johor, left behind wife Puan
Sri Rohani Abdullah and four children.
KUANTAN (April 21): A former super- Former Felda
visor of the Federal Land Development supervisor He served as chief secretary to the
Authority (Felda) pleaded not guilty in the government for six years from 2012 and
Sessions Court here on Thursday (April charged with was also the chairman of the 1Malaysia
21) to a charge of falsifying documents on falsifying Housing Programme, a member of the
the receipt list for cash deposit payments documents United Nations Committee of Experts
to settlers two years ago. on Public Administration, and chairman
Bernama of the Malaysian Institute of Integrity.
Muhammad Aizat Ziadi (repeat: Ziadi),
33, from Temerloh, made the plea before lowed bail of RM4,000 with one surety and
judge Datuk Ahmad Zamzani Mohd Zain. ordered to report himself at a MACC office
every month pending disposal of the case.
He was charged with falsifying the sig-
natures of settlers on the November 2020 The court set May 25 for mention.
Paysheet Cash Payment Receipt Account Malaysian Anti-Corruption Commis-
List (PS) and December 2020 Advance sion (MACC) prosecuting officer Nadzirah
Cash Payment Receipt (PT) Account List Zahari prosecuted, while the accused was
at the Felda Sebertak Office, Bera. unrepresented.

The charge, framed under Section 464
(a) of the Penal Code, provides an impris-
onment for up to two years or with a fine
or both, upon conviction.

Muhammad Aizat, who had since lost the
job and now working as a mechanic, was al-

F R I D A Y A P R I L 2 2 , 2 0 2 2 17 T H E E D G E C E O M O R N I N G B R I E F

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MAFI assures Pan Borneo ly to ensure contractors will complete the
adequate Highway:Works work according to the scope and schedule
Ministry hopes that had been agreed,” he told reporters
chicken, egg no more delays after visiting several work packages for the
supply for highway project near here.
Aidilfitri Bernama
Arthur called on the people to be pa-
Bernama TELUPID (April 21):TheWorks Ministry tient while the implementation of the pro-
(KKR) hopes there will be no more delays in ject is resumed, especially for the Sanda-
GURUN (April 21): The Ministry completing the Pan Borneo Highway, with kan-Telupid route where several roads were
of Agriculture and Food Industries the country having entered the Covid-19 badly damaged.
(MAFI) has assured adequate chick- transition to endemic phase, said Deputy
en and egg supply to meet the de- Minister Datuk Arthur Joseph Kurup. He said the contractor has begun paving
mand for the Aidilfitri celebration the road for the public's safety, but he did not
next month. He acknowledged that the implementa- deny that there would still be some incon-
tion of the Movement Control Order (MCO) veniences experienced by road users due to
Its minister Datuk Seri Dr Ron- to curb the spread of the Covid-19 pandemic the construction of the Pan Borneo Highway.
ald Kiandee said the supply of raw was one of the main reasons that caused the
materials is stable. delay in the highway's construction, thus re- “However, this inconvenience is only
sulting in delays to the maintenance of several temporary during the construction work.
“We are monitoring the poultry roads in the Pan Borneo alignment. At the same time, the implementation sta-
and egg farms, and we are assured tus is progressing quite well,” he also said.
by the farm operators and producers “When the government implemented
that there is sufficient supply for the the MCO, there were many problems such The 58-km Sandakan-Telupid Road is an
upcoming festive season. as the shortage of workers and materials, alignment under work packages 28,29 and 30
closure of factories, and others. However, of the Pan Borneo Highway project, launched
“MAFI will see in terms of sup- since there is no MCO now, we can now by Prime Minister Datuk Seri Ismail Sabri
ply perspective while the price will implement the work. Yaakob last November.The project involves
be monitored by the Ministry of a construction cost of RM877 million.
DomesticTrade and Consumer Af- “KKR always monitors and receives
fairs,” he told reporters after officiat- implementation progress reports month- The scope of the road construction in-
ing the United Arab Emirates-based volves upgrading the two-way road (single
HotPack Packaging Industries LLC carriageway) to a dual carriageway (four
(Hotpack) groundbreaking ceremo- lanes),together with the construction of three
ny here on Thursday (April 21). new bridges and a multi-level interchange.

FreeThe Seed Sdn Bhd (FreeThe The work package is expected to take
Seed), a Malaysian biotechnology three years and is scheduled for comple-
company that manufactures biode- tion in October 2024.
gradable products from rice straw, has
partnered with Hotpack to build the Covid-19: Recoveries Covid-19 cases and vaccination
first Hotpack plant in Southeast Asia. continue to surpass progress in Malaysia

Through the collaboration, Free new cases on On April 20, 2022
The Seed becomes a technology and April 20
operational partner for Hotpack, Daily vaccine doses administered 60,923
providing raw materials, expertise, Bernama
workforce, and technical knowledge Daily booster administered 5,515
to the UAE company, while Hotpack KUALA LUMPUR (April 21): Malaysia
will manufacture and provide a new recorded a total of 8,267 recovered cases on % of adult population received 97.6
line of biodegradable products for its Wednesday (April 20), bringing the cumu- two-dose vaccination
global markets, including Gulf Co- lative number of recoveries to 4,283,013,
operation Council (GCC) countries. according to Health director-general Tan % of adult population received 68.0
Sri Dr Noor Hisham Abdullah. booster shots
In the meantime, Ronald said
the cost of livestock production is He said new cases reported onWednesday Number of new cases 6,968
currently increasing because the were also below the 10,000 mark at 6,968
price of imported animal feeds is cases, bringing the cumulative number of Local cases 6,936
also increasing. positive cases in the country to 4,409,202.
Imported cases 32
“From MAFI’s point of view, the Dr Noor Hisham also said 6,937 or 99.65%
cost of livestock production has in- of the total daily cases reported onWednesday Category 1 2,854
creased over the past two months. were in Categories 1 and 2, while 0.44% or 31
We import corn and soybean meal cases were in Categories 3, 4 and 5. (no symptoms) (40.96%)
from overseas, depending on the im-
port market price,” he added. “Of the total new cases, 6,936 cases are Category 2 4,083
local transmissions while another 32 are (mild symptoms) (58.60%)
imported cases. A total of 97 cases require
treatment in the intensive care unit (ICU) Category 3 11
and 63 cases require respiratory assis-
tance,” he said in a statement onThursday. (with pnemonia) (0.16%)

Category 4 8
(with pneumonia requiring oxygen therapy) (0.11%)

Category 5 12
(critical and requiring assisted ventilation) (0.17%)

Number of new recoveries 8,267

Active cases 90,724

Daily Covid-19 deaths 16

Hospital bed utilisation (%) 60.9

Source: Ministry of Health

Click here for the full story

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WORLD

A prolonged
China slowdown

raises risks for
global economy,
IMF chief says

BY KEVIN YAO, STELLA QIU & ELLEN ZHANG
Reuters

BOAO, China (April 21): A prolonged Xi Jinping said China’s economy is resil- Boosting consumption
slowdown in China would have substan- ient and that its long-term trend had not “What we see in China is that consump-
tial global spillovers, IMF Managing Direc- changed. tion is falling short, it is not recovering as
tor Kristalina Georgieva said onThursday, strongly as necessary,” Georgieva told a
but added that Beijing has room to adjust In light of growing headwinds, for- news conference at the IMF and World
policy to provide support. eign brokerages have also been slashing Bank spring meetings on Wednesday. “So
GDP forecasts for China, after weakness rather than moving money into public in-
The International Monetary Fund on in March activity data raised outlook risks vestments, move it into the pockets of peo-
Tuesday cut its growth forecast for China as the lockdown in the mega city of Shang- ple, so there is more dynamism coming
this year to 4.4%, well below Beijing’s tar- hai drags on. from a consumption boom.”
get of around 5.5%, on the risks of wide-
spread Covid-19 lockdowns and supply Barclays on Tuesday cut their already China’s commerce ministry said on
chain disruptions. below-consensus forecast to 4.3%, from Thursday it would roll out targeted meas-
4.5% previously, while BofA downgraded ures to boost a recovery in consumption.
In a video speech to the annual Boao their forecast for this year to 4.2%, from Spending has been hit hard by lockdowns
Forum for Asia, Georgieva said China’s 4.8% before. across the country that began last month
actions to counter its economic slowdown to contain the spread of Covid-19.
are vital for the global recovery. Nomura onThursday revised their fore-
cast to 3.9% this year, from 4.3% previous- Final consumption accounted for
“Fortunately, China has policy space ly, and second-quarter growth is expected 69.4% of China’s GDP growth in the first
to provide macroeconomic policy sup- to expand by a meagre 1.8%, according quarter, according to official data.
port, including shifting the focus toward to their baseline estimates.
vulnerable households to strengthen con-
sumption, which can also help support
China’s climate goals by steering eco-
nomic activity to lower-carbon sectors,”
Georgieva added.

“Stronger policy efforts in the proper-
ty sector can also help secure a balanced
recovery.”

At the same venue, China’s President

BOAO, China (April 21): Chinese Pres- China’s Xi
ident Xi Jinping on Thursday reiterated says unilateral
China’s opposition to unilateral sanc- sanctions will
tions and “long-arm jurisdiction”, and
said that “de-coupling” and pressure not work
tactics such as cutting off of supply
chains will not work. BY KEVIN YAO
Reuters
China has repeatedly criticised western
sanctions, including those against Russia China’s economy is facing headwinds
over its invasion of Ukraine, but has also from the impact of its aggressive efforts to
been careful not to provide assistance to battle outbreaks of the Omicron variant
Moscow that could lead to sanctions be- of Covid-19, especially in its economic
ing imposed on Beijing. hub of Shanghai. Xi did not specifical-
ly mention China’s current Covid crisis
During a video speech to the annual during the speech.
Boao Forum for Asia gathering on the
southern Chinese island of Hainan, Xi
also said that efforts are needed to sta-
bilise global supply chains, but also said
China’s economy is resilient and that its
long-term trend had not changed.

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WORLD

IMF says yen Japan explained to G7 yen’s ‘somewhat rapid’ declines
falls driven by — finmin Suzuki
fundamentals,
urges BOJ to TOKYO (April 21): Japanese Finance invasion of Ukraine, he said.
keep easy policy Minister Shunichi Suzuki said onThurs- Suzuki said rapid currency moves were
day that he explained to his G7 counter-
STORIES BY LEIKA KIHARA parts the yen’s recent “somewhat rapid” undesirable, when asked about the yen’s
Reuters declines. recent decline to two-decade lows against
the dollar.
TOKYO (April 21): The yen’s recent de- “I believe the G7’s basic thinking on ex-
clines have been driven by fundamentals and change rates remains intact,” Suzuki told a Bank of Japan (BOJ) Governor Haru-
would be no reason for Japan to change its news conference after attending the meet- hiko Kuroda, who also attended the G7
economic policy, including the central bank’s ing with his Group of Seven counterparts, meeting held inWashington D.C., said ex-
ultra-low interest rates, a senior International held on the sidelines of the International cessive exchange-rate volatility could affect
Monetary Fund (IMF) official said. Monetary Fund gatherings. business activity.

The remarks highlighted the difficultyTo- Currency moves, however, were not “It’s desirable for exchange rates to
kyo may face if it sought international consent the main topic of the G7 finance leaders’ move stably, reflecting fundamentals,”
to intervene in the currency market to stem meeting, which focused on discussions Kuroda said. “The BOJ will carefully
further yen falls, as G7 and G20 countries over the global economy and Russia’s watch how currency moves could affect
agree such action is justified only if exchange Japan’s economy and prices,” he added.
rates move out of line with fundamentals.
continuing to defend its ultra-low rate policy in time, it does affect households. It’s a little
“What we’re seeing so far on the yen is contrast with heightening chances of aggressive bit of a mixed bag,” he said in the interview.
driven by fundamentals,” Sanjaya Panth, rate hikes by the US Federal Reserve.
deputy director of the IMF’s Asia and Pacific With inflationary pressure still muted,
Department, told Reuters late onWednesday. “We do not see disorderly market con- there was no need for the BOJ to change
ditions right now in the foreign exchange its ultra-loose policy, Panth said.
“Economic policymaking should continue market. It’s been driven by fundamentals,”
to look at fundamentals.We don’t see any rea- Panth said, when asked whether yen-buy- While temporary factors, such as the
son to change economic policy because what’s ing currency intervention by Japanese au- dissipating effect of past cuts in cellphone
happening right now reflects fundamentals.” thorities would be justified. fees, could push up headline consumer
price inflation, Japan was unlikely to see
The yen has plunged to two-decade lows Markets are rife with speculation Japan inflation sustainably reach the BOJ’s 2%
against the dollar,with the Bank of Japan (BOJ) may act to resist further yen declines, per- target in the near term, he added.
haps by buying yen, raising interest rates
or tweaking the BOJ’s dovish guidance on “Japan is in a very different situation com-
the future path of monetary policy. pared with other advanced countries who
have begun tightening monetary policy,” he
“As you know, a weak yen hasn’t been said.“We do not see any need to change the
bad for Japan,” Panth said. “At the same accommodative monetary policy stance.”

TOKYO (April 21): Japan’s ruling coalition Japan agrees plementary budget rather than taking funds
onThursday agreed a supplementary budget US$21 bil extra from the country’s contingency reserve.
to support lower-income households and budget to tackle
small firms, signalling more spending for the rising living costs Suehiro saidThursday’s news also reflect-
heavily indebted nation as it battles inflation- ed a preference for using fiscal tools to allevi-
ary pressures for the first time in decades. BY TETSUSHI KAJIMOTO, KANTARO KOMIYA, ate households’ burdens rather than tweaking
KENTARO SUGIYAMA & TAKAYA YAMAGUCHI monetary policy or intervening in the cur-
In a first phase, Prime Minister Fumio rency market to prop up a yen that is trading
Kishida’s Liberal Democratic Party-led Reuters at close to 20-year-lows against the dollar.
(LDP) government aims to set out onTues-
day relief measures worth 1.5 trillion yen ures and the rest set aside to offset the impact Covering the extra stimulus might in-
(US$11.7 billion).They will include one- of surging costs of fuel and other products. volve additional bond issues, which would
off 50,000 yen cash payouts to low-income More than 1 trillion yen will be earmarked for further enlarge the industrial world’s heav-
households with children and expanding maintaining the current fuel subsidy scheme iest public debt burden, which stands at
subsidies to fuel wholesalers, a preliminary from June to September, the draft showed. more than twice annual economic output.
document seen by Reuters showed.
The package is expected to be submit- Japan entered a long period of close-to-
The governing coalition, which faces ted to parliament for approval in May.The zero inflation in the early 1990s that de-
upper house elections pencilled in for July current legislative session is scheduled to termined the way policymakers managed
10 as the economy flags and voters strug- end in June. Komeito’s Ishii said his party its economy for decades.
gle to cope with soaring energy costs, also endorsed the timetable.
aims to ensure stable supplies of oil and Driven by the war in Ukraine and already
basic foods, according to the draft. Toru Suehiro, senior economist at Daiwa surging fuel costs, inflation pressures are now
Securities, said the LDP had probably been building.While core CPI remained low at just
News of the extra budget — whose pressured by Komeito to draw up a sup- 0.6% year on year in February, energy costs
total value Keiichi Ishii, secretary gener- rose 20.5% in that month, while wholesale
al of the LDP’s smaller ally, the Komei- inflation reached 9.5% in March.
to party, estimated at 2.7 trillion yen Read also: History of Japan’s intervention
(US$21 billion) — was unexpected. in currency markets Click here

Part of it will be used for emergency meas-

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ECB rate at zero or more by year end
a ‘no brainer’,Wunsch says

BY ALEXANDER WEBER, JANA RANDOW, Pierre Wunsch BLOOMBERG
JAMES HIRAI & ALESSANDRA MIGLIACCIO
Without any really “There are of course situations where if
Bloomberg bad news coming the shock is very big on the real economy,
from that front, we would feel more comfortable looking
(April 21):The European Central Bank could hiking by the end through the inflation development,” he said.
lift policy rates above zero before the end of But “we’re still in a situation where we’re sup-
the year unless the euro-zone economy suffers of this year to portive in terms of monetary policy. Real rates
a severe shock, and it might even have to de- zero or slightly are today very, very negative. So the begin-
ploy “restrictive” policy to get surging prices positive territory ning of the normalization process should be
under control, Governing Council member for me would be relatively independent of the real economy.”
Pierre Wunsch said. a no brainer.” Drastic Steps
He also wouldn’t rule out a scenario where
While the war in Ukraine presents a signif- the ECB might have to take more drastic steps
icant risk to the economy, it probably won’t than currently envisioned to contain inflation.
keep the ECB from raising borrowing costs to
react to a series of unexpectedly strong infla- “We’re still talking about normalization,
tion readings, he said in an interview inWash- but I wouldn’t exclude that at some point,
ington conducted on Wednesday evening. if we have second-round effects, wages go-
ing up, that monetary policy would have to
“Without any really bad news coming from become restrictive,” he said. “What’s priced
that front, hiking by the end of this year to in by the markets today to me is on the low
zero or slightly positive territory for me would side of what might be required to get infla-
be a no brainer,”Wunsch said. tion under control.”

Traders ramped up rate bets onWunsch’s Traders see a 75% chance of a quar-
comments and now see an 80% chance of ter-point move in July, and are bracing for
a quarter-point move in July. They are also the deposit rate to reach zero by October.
bracing for the deposit rate to turn positive
for the first time since 2012 by December. On concerns that the ECB’s exit path
could put more highly indebted countries
President Christine Lagarde put the ECB in the euro area under pressure and lead to
on an accelerated exit path in February, and a new debt crisis,Wunsch said there’s “quite
there’s been increasing speculation among broad” consensus within the central bank that
economists and investors about how quick- “unwarranted fragmentation” on bond mar-
ly rates will rise. Investors have been betting kets would be addressed. But he cautioned
that the deposit rate — currently at -0.5% that policy makers shouldn’t “over-engineer
and negative since 2014 — will reach zero instruments because we need to be able to
this year. react to specific circumstances”.

Some members of the Governing Council
have suggested ending bond purchases at the
end of this quarter and raising interest rates
as early as July. Wunsch said he agreed that
this timeline was a possibility.

“It’s going to of course depend on data,”
he said. “If we have another inflation surprise,
it’s certainly a scenario that I would consider.”

German two-year yields — which are the
most sensitive to changes in monetary poli-
cy — are poised to surge by the most in six
weeks, climbing nine basis points to 0.14%.

Consumer prices rose by a record 7.5%
in the euro area last month after Russia’s
invasion of Ukraine further strained supply
chains and sent already lofty energy costs
even higher. At the same time, the economic
outlook has darkened as confidence among
businesses and households plunged.

Any disruption in the flow of natural gas
from Russia to the currency bloc is seen as
a major risk, though it’s not a given that this
would keep the ECB from continuing to exit
from ultra-loose policy settings,Wunsch said.

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COPENHAGEN (April 21): Carlsberg, REUTERS Dutch rival Heineken has also said it
the Western brewer most exposed to the will exit Russia, and last month said it ex-
Russian market, expects its decision to Carlsberg expects pected to book related charges of about
sell its business there to result in a write- US$1.4 bil Russia 400 million euros (US$437 million).
down of about 9.5 billion Danish crowns
(US$1.39 billion), it said on Thursday. writedown and Carlsberg had non-current assets in
lowers profit Russia worth 19.2 billion Danish crowns
The company, which has eight breweries guidance by the end of 2021, its annual report said.
and 8,400 employees in Russia, said late last
month that it would sell its business in the BY JACOB GRONHOLT-PEDERSEN, “The writedown isn’t quite as grim as
country, joining an exodus ofWestern com- NIKOLAJ SKYDSGAARD & STINE JACOBSEN one might have feared,” Sydbank analyst
panies since Russia’s invasion of Ukraine. Per Fogh told Reuters.
Reuters
The writedown did not take into ac- “This is what they consider to be fair
count any external offers for the business value of the asset now, but the question
and was subject to a “very high degree still remains what a potential buyer would
of volatility and uncertainty”, Carlsberg pay for it.”
said, adding that the sale could take up
to 12 months. Carlsberg last year generated 10% of
its revenue and 6% of its operating profit
in Russia, where it took full control of the
Baltika group of breweries in 2008.

Since then, however, it has faced slug-
gish sales in a sanctions-hit economy, while
facing Russian regulations aimed at curb-
ing alcohol abuse.

Carlsberg lowered its operating profit
growth forecast for this year to between
minus 5% and plus 2%, compared with
previous guidance of 0% and 7%.

Shares in Carlsberg, which have shed
nearly a quarter of their value since the
start of the year, fell slightly on the news
but were up 1% by 1026 GMT.

The brewer said it also expected 300
million crowns of Ukraine impairment
charges, along with goodwill writedowns
of 700 million crowns for the Central and
Eastern Europe region, which includes
Ukraine.

BERLIN (April 21): Continental cut its Continental cuts The supplier said it expected indus-
annual earnings forecast and warned of earnings forecast try-wide production of passenger cars and
“lasting consequences” for production and as Ukraine war light commercial vehicles to increase by
supply chains if the war in Ukraine does pushes up costs just 4%-6% year-on-year in 2022, down
not ease, with rising energy and raw ma- from its forecast of 6%-9% in March.
terial costs weighing on margins. BY VICTORIA WALDERSEE
Reuters As such, it expected its earnings margin
The supplier nearly doubled its expect- for the year to be around 4.7%-5.7%, down
ed procurement and logistics costs in its from its previous forecast of 5.5%-6.5%.
tyre and ContiTech divisions and cau-
tioned the automotive group sector could Continental said onTuesday it had tempo-
end up in the red, having previously fore- rarily resumed tyre production for passenger
cast a margin of 0%-1.5% for the division. cars at its plant in Russia onTuesday after sus-
pending it in early March following Russia’s
“Negative effects from cost inflation for invasion of Ukraine, to protect local workers
key inputs... as well as energy and logis- who could otherwise face criminal charges.
tics... are becoming significantly more ma-
terial,” the supplier said in a statement on BLOOMBERG
preliminary first-quarter results.

“In the event the geopolitical situation,
in particular in Eastern Europe, remains
tense or worsens, it could result in further
lasting consequences for production, sup-
ply chains, and demand,” it said.

Continental reported a first-quarter
earnings margin of 4.7%, down from 8.5%
last year, even as consolidated sales rose to
€9.3 billion from €8.6 billion in the first
quarter of 2021.

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REUTERS

(April 21): Elon Musk’s tunneling startup Elon Musk’s another startup and became PayPal, Musk
Boring Co. has raised $675 million in a Boring Co would be fired as chief executive officer
funding round led by Vy Capital and Se- raises funding at amid management disagreements. Se-
quoia Capital.The round values the start- nearly US$6 bil quoia’s Roelof Botha worked at PayPal
up at $5.675 billion, the company said in valuation as chief financial officer.
a press release on Wednesday.
BY SARAH MCBRIDE Boring has evolved over the years
Boring Co. aims to “solve traffic” by Bloomberg since its founding in 2016, when its vi-
building transportation networks in tun- sion was long-haul transportation over
nels deep underground.The company al- state-of-the-art, and improving at an ex- hundreds of miles. Now, it specializes in
ready has a tunnel system in place at the ponential rate,” Sequoia Capital’s Shaun shorter trips within cities -- with some
LasVegas Convention Center, and ferried Maguire wrote in a blog post. easier to work in than others. Planned
around passengers at the CES conference projects in Chicago, Los Angeles, and
earlier this year.The company aims to ex- Musk has long-standing connections a connection between Washington and
pand in other cities in coming years, and to Sequoia. An early Musk company that Baltimore have fizzled, even as the Vegas
said it would use the new funding to “sig- facilitated payments online, X.com, was project has won kudos.
nificantly increase hiring.” backed by Sequoia’s Mike Moritz, al-
though after the company merged with The new funding round includes stra-
Other investors participating in the tegic investments by real estate compa-
round include Valor Equity Partners, nies, including Brookfield, Lennar Corp.,
Founders Fund, 8VC, CraftVentures and Tishman Speyer and Dacra Development
DFJ Growth. The fresh financing comes Corp.That could indicate that Boring Co.
three years after Boring Co. raised $120 is trying to integrate its tunnels into new
million at a valuation of $920 million. building projects, as it has done with two
hotels in Las Vegas.
Boring’s “technology is now past the

DALLAS/BENGALURU (April 21): AT&T posts 2.5% dalone AT&T excluding WarnerMedia
AT&T Inc on Thursday posted a 2.5% rise in quarterly rose to US$29.7 billion in the first quar-
rise in revenue for its core phone and in- ter, from US$29 billion a year earlier.
ternet business in the first quarter, as the core wireless
telecom giant benefited from the expan- revenue Total revenue, however, was down more
sion of its fibre internet and 5G services. than 13%, reflecting the impact of its di-
BY SONIA CHEEMA, EVA MATHEWS vested satelliteTV business and weakness
The Dallas,Texas-based firm — whose & SHEILA DANG in its business wireline unit.
WarnerMedia unit completed its merger Reuters
with Discovery Inc earlier this month to The company added 289,000 fibre in-
form the new media firm Warner Bros. ternet customers during the quarter end-
Discovery — added 691,000 monthly ed March 31.
phone subscribers during the quarter.
Total global subscribers for premium
AT&T is returning to its roots of pro- TV channel HBO and streaming service
viding wireless services after unwinding a HBO Max, which are part of WarnerMe-
years-long effort to become a media and dia, rose by 3 million from the previous
entertainment company. quarter.

Shares of AT&T rose 1.5% to Net income attributable to common
US$19.73 in premarket trading. stock fell to US$4.8 billion or 65 cents per
share, from US$7.5 billion or US$1.02
The company’s revenue for the stan- per share a year earlier.

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(April 21): China’s key state-run energy China energy vision and Administration Commission
companies are in talks with Shell Plc to giants in talks for of the State Council, which supervises
buy its stake in a major Russian gas ex- Shell’s Russian state-owned firms, also didn’t immedi-
port project, according to people with ately respond to a request for comment.
knowledge of the matter. gas stake
Shell, as well as rivals including Exx-
Cnooc, CNPC and Sinopec Group are Bloomberg on Mobil Corp, took the energy industry
in joint discussions with Shell over the by surprise by signaling plans to walk
company’s 27.5% holding in the Sakha- three Chinese companies are formally away from Russian assets worth billions
lin-2 liquefied natural gas venture after known — didn’t immediately respond of dollars after war erupted in Ukraine in
the European firm said it would exit Rus- to requests for comment. February. Earlier this month, Shell said
sian operations following the Ukraine in- its withdrawal from Russia will result in
vasion, said the people, who requested China’s State-owned Assets Super- as much as US$5 billion of impairments.
anonymity to discuss private details.
London-based competitor BP Plc also
Discussions are at an early stage and reached out to state-backed firms in Asia
it remains possible no deal will be agreed and the Middle East, including CNPC
with the firms, the people said. Shell is and Sinopec, as it searches to offload
also open to talks with other potential its 20% stake in Russia’s Rosneft PJSC,
buyers outside of China, one of the peo- Bloomberg reported last month.
ple said.
Dozens of Shell employees on tempo-
Shell shares rose as much as 1.3% on rary assignment at the Sakhalin-2 project
the news to 2,236 pence in London on in Russia were removed over the weekend
Thursday, while the FTSE 100 Index to be relocated back to other offices as
held steady. Shares were trading 0.4% the company moves forward with an exit.
higher at 2,216 pence at 10.50am.
Russia’s war in Ukraine has roiled en-
The talks include a potential sale of the ergy markets and sent commodities pric-
stake to one of the Chinese companies, es surging, adding pressure on govern-
to two of the firms, or to a consortium ments globally to rethink their long-term
of all three. planning for fuel supplies. China’s still-
close trading relationship with Moscow
Shell declined to comment. Represent- makes the nation’s firms well positioned
atives for China National Offshore Oil to snap up stakes in projects as Western
Corp, China National Petroleum Corp companies exit.
and China Petrochemical Corp — as the

SHANGHAI (April 21): Chinese oil giant China oil giant CNOOC starts trading in Shanghai
CNOOC Ltd surged as much as 44% on CNOOC soars on against a backdrop of a bleak stock mar-
its Shanghai debut onThursday, after rais- Shanghai debut, ket that has witnessed an increasing num-
ing 28.08 billion yuan (US$4.41 billion) in ber of stocks dipping below initial public
China’s 11th-biggest public stock offering. defying weak offering (IPO) prices.
market
The stock started trading on the Shang- A third of the roughly 100 companies
hai Stock Exchange at 12.96 yuan, 20% BY JASON XUE, SAMUEL SHEN newly listed this year in Shanghai and
higher than the offering price of 10.8 yuan. & ANDREW GALBRAITH Shenzhen dropped below offer prices on
Reuters debut, showed data from East Money In-
Trading in the oil giant was suspended formation. Some, including chipmaker
by the exchange after the stock hit the up- REUTERS Vanchip Tianjin Technology Co Ltd and
per limit of the daily allowable price band electronics firm RigolTechnologies Co Ltd
for new listings, citing abnormal fluctua- ment opportunities due to high oil pric- tumbled more than 30%.
tion, defying a weak market that saw Chi- es, low valuation, and consistently high
na’s blue-chip index shed 0.5%. dividend yields,” Chen Shuxian, analyst Such debut performance — in sharp
at Cinda Securities, wrote on Thursday, contrast with the first-day pop that once
CNOOC’s Hong Kong-listed stock adding CNOOC’s market cap has potential featured in China’s stock markets — re-
surged as much as 4.3% before paring to double over the next few years. flects the result of IPO reforms, as well
gains. bearish investor sentiment.

“CNOOC is being chased by inves- China’s tough Covid-19 containment
tors who are seeking shelters in big caps measures at a time of heightened geopolit-
with relatively low valuation and high div- ical risk are also roiling its stock markets,
idends,” said LinusYip, chief strategist at sending the main benchmark stock index
First Shanghai Group. “The stock also down 18% so far in 2022.
whets market appetite at a time when oil
prices are climbing and inflation acceler- The Shanghai sale came after CNOOC
ating.” was delisted in October by the NewYork
Stock Exchange after the US government
China’s largest offshore oil producer added the firm to a trade blacklist citing
CNOOC has said it would use the share suspected connections to China’s military.
sale proceeds to fund one gas and seven
oilfield projects in China and overseas, and State-backed peers PetroChina Co Ltd
to replenish capital. and China Petroleum & Chemical Corp
are already listed in Shanghai.
“CNOOC represents historic invest-

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TALLINN (April 21): Germany is ex- Stung by Russia calls its incursion a “special
amining what extra maintenance and criticism, military operation” to demilitarise and
ammunition its stock of ageing Marder Germany says it “denazify” Ukraine. Kyiv and its Western
armoured infantry fighting vehicles will is open to sending allies reject that as a false pretext for an
need for Ukraine to use them, Foreign Ukraine heavy illegal war of aggression.
Minister Annalena Baerbock said. weapons
But Baerbock said the priority was
On the second day of a tour of Baltic BY ALEXANDER RATZ & THOMAS ESCRITT to ensure Ukraine quickly got older
states, Baerbock addressed criticism by Reuters Soviet-designed kit that its military
allies and commentators of Germany’s could use without extra training, and
apparent foot-dragging on delivering the REUTERS that it was doing this by backfilling the
weaponry Kyiv says it needs to fend off stocks of allied countries that had such
Russian attacks. German Foreign weaponry to spare with modern Ger-
Minister man-made gear.
“There are no taboos for us with re- Annalena
gard to armoured vehicles and other The German armed forces themselves
weaponry that Ukraine needs,” she told Baerbock in faced equipment shortagers, she add-
a news conference with her Estonian Tallinn, Estonia ed, noting that German peacekeeping
counterpart on Thursday. missions in Africa did not have all the
on April 21, helicopters they needed.
Earlier, Bild newspaper had accused 2022.
Chancellor Olaf Scholz of blocking tank Pressed by journalists on whether
deliveries. Germany’s Leopard tank would be sent
to Ukraine, she said troops would need
Many analysts say Ukraine urgent- training to use such advanced kit, and
ly needs heavy weapons to drive back a that Berlin would pay for that training.
Russian invasion that has now concen-
trated on taking ground in the eastern “We are providing one billion euros
Donbass region. because we should think not just for
the coming days and months, but also
While Ukraine’s light armaments and the next years for the systems Ukraine
tactics have had some success in slowing needs for defence now, but also for a free
Russia’s advance, stoping and reversing Ukraine in the future,” she said.
that incursion will need heavy battlefield
weaponry like tanks and howitzers, they say. “We know that every day counts.”

WASHINGTON/LONDON (April 20): Yellen, BoE’s Ukraine war, food security and ongoing
Top finance officials from Britain, the Bailey, others recovery from the coronavirus pandemic
United States and Canada walked out walk out of G20 the key topics.
of Wednesday’s meeting of finance offi-
cials from the world’s top 20 economies meeting as Maksimov was participating in person
as Russian representatives spoke, a UK Russians speak at the meeting, one source said. Russia’s
government spokesperson said, exposing Finance Minister and Central Bank gov-
deepening divisions over Russia’s contin- BY DAVID LAWDER, ANDREA SHALAL ernor participated virtually, other sources
ued presence in the body. & DAVID MILLIKEN familiar with the meeting said.
Reuters
Ukraine officials in attendance also Earlier on Wednesday,Yellen told her
walked out, according to a source famil- G20 Finance Ministers and Central counterpart from G20 chair Indonesia that
iar with the meeting. Bank governors were meeting on the there would be no “business-as-usual” for
sidelines of a semi-annual conference Russia in the global economy given its in-
“Alongside our allies the US and Can- held by the International Monetary Fund vasion of Ukraine, the US Treasury said.
ada, representatives from the UK left the and World Bank in Washington, with the
G20 meeting as Russian delegates spoke,” USTreasury officials sayYellen will boy-
the spokesperson said. “We will continue cott some of the G20 sessions attended
working with our allies to condemn Rus- virtually by Russian officials but will par-
sia’s war against Ukraine in the strongest ticipate in discussion of the Ukraine war’s
terms, and push for stronger international impact on the global economy.
coordination to punish Russia.”
Finance leaders from a number of Eu-
USTreasury Secretary JanetYellen told ropean countries planned to follow suit in
attendees she disapproved of a senior Rus- protest of Russia’s invasion.
sian official’s presence at the meeting, two
sources familiar with the matter told Reu- Canada’s Finance Minister Chrystia
ters.Yellen was among those who walked Freeland, for instance, was set to “leave
out, joined by Bank of England Governor and boycott any sessions where the Rus-
Andrew Bailey and others. sians try to speak,” a Canadian government
official said. Freeland was among those re-
European Central Bank President ported to have walked out onWednesday.
Christine Lagarde, meanwhile, urged that
Russian official, Deputy Finance Minister Freeland, who is of Ukrainian descent
Timur Maksimov, to convey to Moscow a and has made impassioned pleas on behalf
clear message — to end the war in Ukraine, of the country after Russia’s invasion in
one of the sources said. February, “may also use the opportunity
to provide a rebuttal directly to the Rus-
sians if they speak in the plenary.”

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Musk wants free speech onTwitter after
spending years silencing critics

(April 21): If Elon Musk is able to take BY DANA HULL, SARAH FRIER ments Musk makes on Twitter, in part
over Twitter Inc, his biggest promise is to & MAXWELL ADLER because he largely disbandedTesla’s com-
transform it into a platform for free speech Bloomberg munications team in the US and rare-
with few restrictions — something he calls ly responds to inquiries from the finan-
“essential to a functioning democracy.” engaged in sabotage and shared data with cial press. Several journalists who cover
But Musk, who is famously sensitive to the press and “unknown third parties.” Musk’s companies have been blocked by
criticism, has a mixed record on cham- him on Twitter. Musk didn’t respond to
pioning the cause. Tesla’s PR department spread false ru- a request for comment via email.
mours that Tripp was possibly homicidal
The 50-year-old billionaire has do- and had threatened to “shoot the place Musk called himself a “free speech
nated over US$6 million to the Ameri- up,” even though authorities had already absolutist” in March when he tweeted
can Civil Liberties Union in the last five determined that Tripp posed no immedi- that Starlink — SpaceX’s satellite-based
years, making him one of its most sub- ate threat and wasn’t armed. internet service that is now operating in
stantial donors, and he’s discussed free Ukraine — wouldn’t block Russian state-
speech on numerous occasions with the Another employee was fired six days run news sources, which were cut off by
organization’s executive director. But in after he posted aYouTube video of hisTe- some social media platforms at the time.
his tweets, public remarks and policies at sla Model 3 running into a traffic pylon
the businesses he runs, Musk shows little while using “FSD Beta,” an early version “He and I have spoken on free speech
tolerance for speech that’s unflattering to of software that Tesla has rolled out to issues on numerous occasions, and I know
him or his companies, or reflects employ- roughly 100,000 people. that he is quite passionate about defend-
ee criticism of the workplace. ing free speech,” Anthony Romero, ex-
And then there’s the case of Jack ecutive director of the ACLU, said in an
At Tesla Inc and SpaceX, Musk has a Sweeney, a Florida teenager who tracks email. Romero attended the TED con-
long track record of silencing or punishing private jets. A few months ago, Musk ference in Vancouver last week, and he
anyone who goes public with criticism of reached out to him and offered US$5,000 and Musk exchanged messages right after
a project or practice. Workers must sign to shut down the “Elon’s Jet” account, Musk’s on-stage conversation. “I believe
nondisclosure agreements and arbitra- Sweeney said. Musk viewed it as a secu- Elon to be a true civil libertarian.”
tion clauses that prevent them from tak- rity risk. Sweeney asked for US$50,000,
ing their employer to court. which Musk refused.The billionaire then But Musk has already cited some in-
blocked some of the social media accounts stances where he believes content onTwitter
Meanwhile, Musk uses his Twitter ac- connected to Sweeney. should be blocked. AtTED, he saidTwitter
count, where he has more than 80 million should continue to take down content on a
followers and a fan base he can ignite, to If Musk were in charge of Twitter poli- geographic basis, as the company “is bound
publicly mock others, from a local health cy, he said he believes that people should by the laws of the country that it operates
official during the early days of the pan- be blocked only as a last resort, accord- in.” In Germany, for instance, it’s against
demic to Parag Agrawal,Twitter’s current ing to his comments at TED. If it’s a gray the law to deny the Holocaust happened, so
chief executive officer. area, his preference would be to leave the Twitter hides those tweets in that country.
content up, he said.
Musk defined the goal for Twitter at a Musk also said he would like to ban
TED event last week: “A good sign as to It’s difficult to get clarity on the state- cryptocurrency scammers on the site.The
whether there is free speech is: Is someone billionaire’s persona — and his popularity
you don’t like allowed to say something with crypto investors — has been used to
you don’t like? If that is the case, then we trick people in the past.
have free speech.”
“A social media platform’s policies are
But those who have said things Musk good if the most extreme 10% on left and
didn’t like have seen their reputations right are equally unhappy,” Musk tweeted
publicly trashed. Vernon Unsworth, a Tuesday, presenting a stance similar to
British caver who helped rescue 12 boys past statements by Meta Platforms Inc
trapped inThailand, called Musk’s efforts CEO Mark Zuckerberg.
to help a “PR stunt” in 2018. Musk retal-
iated by calling him a “pedo guy.” Then The risk is discouraging some people
he paid US$50,000 to a dubious private from using a platform because it feels un-
investigator to dig into Unsworth’s back- safe or prone to abuse.
ground in the UK and Thailand. He also
attempted to depose a reporter, Ryan Musk is focused on “the idea that free
Mac, who was covering Unsworth’s def- speech means not taking down anything,”
amation lawsuit against Musk. said Emma Llansó, director of the Center
for Democracy andTechnology’s Free Ex-
That same year, Musk went after Mar- pression Project. But if people stop speak-
tin Tripp, a worker at Tesla’s battery plant ing out of fear of bullying or harassment,
in Nevada.Tripp saw himself as an idealist “that can actually really end up excluding
trying to improve the company’s operations; large groups of people and communities
Musk viewed him as a dangerous foe who from participation in online discourse.”

CONTINUES ON PAGE 26

F R I D A Y A P R I L 2 2 , 2 0 2 2 26 T H E E D G E C E O M O R N I N G B R I E F

WORLD

BLOOMBERG

Brokerage boss
detained as

Vietnam stock
slump deepens

BY NGUYEN KIEU GIANG & HARRY
SUHARTONO, JOHN BOUDREAU
& SHIKHAR BALWANI

Bloomberg

(April 21):Vietnam is stepping up scru- “There is a new broom in the house lion in average portfolio investment over
tiny of its financial markets as it seeks to sweeping things out for spring cleaning,” the period, according to data compiled
burnish its credentials as a destination said Fred Burke, senior advisor at the by Bloomberg.
for international investment. law firm Baker McKenzie. “It’s a huge
cultural change in Vietnam.” While Vietnam’s corporate debt mar-
Tri Viet Securities Chief Executive ket is still relatively small, issuance of
Officer Do Duc Nam and Louis Hold- Debt Scrutiny company bonds has skyrocketed over
ings Chairman Do Thanh Nhan have Officials have also been instructed to the past two years, even as the economy
become the latest in a string of Viet- keep a close eye on issuance and trad- grappled with the pandemic, prompting
namese executives to be detained by po- ing of corporate debt. concerns about a buildup of risk.
lice, accused of allegedly manipulating
stock prices. Vietnam has been attractive to glob- As part of a widening probe into
al companies like Intel Corp, Samsung alleged stock manipulation at real es-
Prime Minister Pham Minh Chinh Electronics Co and Calvin Klein, plus tate developer FLC Group, the aide
has ordered authorities to crack down their subcontractors, which have set up to Bamboo Airways former Chairman
on violations in the equities, bond and factories and shops there. But its capi- Trinh Van Quyet was detained earlier
property markets, sparking an ongoing tal market is considered less developed this month.
investigation that has hammered the na- than peers such as Malaysia, Indonesia
tion’s share market. Vietnam stocks fell and Thailand, which have more active “The effort of the government to
into a technical correction on Thursday, dollar-denominated bond markets ac- tackle stock manipulation and corporate
with the benchmark VN Index extending cessible to foreign investors. bond issuance could further negative-
declines from a January high to 10%.The ly impact on sentiment and cashflow in
index closed down 1.1% today. The Southeast Asian nations attract- the short-term,” said Phung Trung Kien,
ed about US$15 billion in foreign direct founder of Vietnam Holdings Inc, an in-
Following news of the latest arrests, investments on average each year in the vestment consultation and asset manage-
Louis Land JSC sank as much as 9.3% past decade, compared with US$11 bil- ment company. “But in the long run, it
to its lowest level since July, while Lou- is good for the market.”
is Capital JSC dropped as much 6.9%.
Do Thanh Nhan is a board member of
both listed firms.

The stepped-up enforcement comes as
Vietnam looks to be upgraded to emerging
market status from frontier, which would
open the country up to more investment
funds.Vietnam’s stocks have been on the
shortlist for a possible upgrade to second-
ary emerging market, from frontier mar-
ket, by FTSE Russell since 2018.

FROM PAGE 25 admitting wrongdoing. Musk also agreed could reinstate former President Donald
not to tweet about specific topics without Trump’s account if he became Twitter’s
While it’s unclear if any of Musk’s advance approval from a Tesla lawyer. owner.
tweets have been removed by Twitter, his
account has come under intense scrutiny Another of Musk’s tweets drew scru- “It’s always hard when you put humans
by third parties, including the U.S. Secu- tiny from the National Labor Relations in charge of making decisions about what
rities and Exchange Commission, which Board.That post, also from 2018, threat- speech should be allowed or what speech
sued Musk for fraud over his infamous ened workers with the loss of stock options should not be allowed,” said Clay Calvert,
“funding secured” tweet from August if they formed a union. who directs the Marion B. Brechner First
2018.The wording was part of a message Amendment Project at the University of
saying he was considered takingTesla pri- But it’s Twitter’s own efforts to mod- Florida. “The one answer for people who
vate, and it sent the shares surging. erate speech that has drawn recent scorn object toTwitter’s content moderation pol-
from Musk. He has said that the company icies is forming your own company.”
Musk and Tesla ended that dispute by should resort less frequently to banning
agreeing to pay $20 million apiece, without users.That’s led to speculation that Musk Or, in Musk’s case, buying Twitter.

F R I D A Y A P R I L 2 2 , 2 0 2 2 27 T H E E D G E C E O M O R N I N G B R I E F

MARKETS

CPO RM 6,307.00-1.00 OIL US$ 108.051.25 RM/USD 4.2892 RM/SGD 3.1511 RM/AUD 3.1924 RM/GBP 5.603 RM/EUR 4.681

Top 20 active stocks

NAME VOLUME CHANGE CLOSE YTD MARKET
(MIL) (RM) CHANGE CAP
(%) (RM MIL)

MNC WIRELESS BHD 141.90 0.005 0.030 100.00 68.6

VIZIONE HOLDINGS BHD 101.20 0.005 0.105 31.25 214.8

SAPURA ENERGY BHD 78.60 0.005 0.045 -10.00 719.1

TANCO HOLDINGS BHD 66.10 0.035 0.355 47.92 617.4

TA WIN HOLDINGS BHD 63.10 0.005 0.160 28.00 546.3

DATASONIC GROUP BHD 51.40 0.020 0.570 39.02 1632.7

WIDAD GROUP BHD 45.20 0.000 0.365 0.00 1004.7

FITTERS DIVERSIFIED BHD 44.20 -0.015 0.125 -60.32 76

TECHNA-X BHD 42.90 -0.005 0.105 40.00 231.2 World equity indices

DAGANG NEXCHANGE BHD 39.30 0.040 1.090 43.42 3439.8

PASUKHAS GROUP BHD 36.10 0.000 0.020 -20.00 37.7 CLOSE CHANGE CHANGE CLOSE CHANGE CHANGE

CENGILD MEDICAL BHD 34.00 -0.005 0.495 0.00 405.3 (%) (%)
DOW JONES 35,160.79 249.59 0.71 INDONESIA 7,276.19 48.83 0.68
VELESTO ENERGY BHD 28.30 0.000 0.115 -4.17 944.8

DATAPREP HOLDINGS BHD 25.70 0.010 0.295 -63.58 198.5 S&P 500 4,459.45 -2.76 -0.06 JAPAN 27,553.06 335.21 1.23

MY EG SERVICES BHD 23.30 -0.005 0.995 -7.01 7348.6 NASDAQ 100 13,998.53 -211.73 -1.49 KOREA 2,728.21 9.52 0.35

VORTEX CONSOLIDATED BHD 22.2 -0.005 0.19 192.31 203.9 FTSE 100 7,624.56 -4.66 -0.06 PHILIPPINES 7,061.49 -80.93 -1.13

BOUSTEAD HOLDINGS BHD 21.8 0.035 0.81 52.83 1641.9 AUSTRALIA 7,592.79 23.56 0.31 SINGAPORE 3,348.46 13.14 0.39

OCR GROUP BHD 21.2 -0.005 0.125 -13.79 111 CHINA 3,079.81 -71.24 -2.26 TAIWAN 17,127.95 -20.93 -0.12

PUBLIC BANK BHD 20.9 0.02 4.67 12.26 90647.9 HONG KONG 20,682.22 -262.45 -1.25 THAILAND 1,690.55 10.20 0.61

FOCUS DYNAMICS GROUP BHD 20.9 -0.005 0.04 0 254.9 INDIA 57,911.68 874.18 1.53 VIETNAM 1,370.21 -14.51 -1.05

Data as compiled on Apr 21, 2022 Source: Bloomberg Data as compiled on Apr 21, 2022 Source: Bloomberg

Top gainers (ranked by %) Top losers (ranked by %)

NAME CLOSE CHANGE VOLUME YTD MARKET NAME CLOSE CHANGE VOLUME YTD MARKET
(%) (‘000) CHANGE CAP (%) (‘000) CHANGE CAP
(%) (RM MIL) (%) (RM MIL)

MALAYSIA PACIFIC CORP BHD 0.115 43.75 943.1 15 33.1 XOX BHD 0.015 -25.00 1,022 -50.00 75.5

TALAM TRANSFORM BHD 0.025 25.00 120.2 25 107.4 GREEN OCEAN CORP BHD 0.020 -20.00 2,880.3 -33.33 42.2

MNC WIRELESS BHD 0.030 20.00 141854.2 100 68.6 BORNEO OIL BHD 0.025 -16.67 3,366.7 -16.67 186.6

ALDRICH RESOURCES BHD 0.040 14.29 9.1 0 44.5 MLABS SYSTEMS BHD 0.030 -14.29 723.2 0.00 43.5

SAPURA ENERGY BHD 0.045 12.50 78571.8 -10 719.1 AE MULTI HOLDINGS BHD 0.030 -14.29 600.0 0.00 64.9

EA TECHNIQUE M BHD 0.045 12.50 582.5 -43.75 23.9 ANZO HOLDINGS BHD 0.030 -14.29 108.1 0.00 33.5

TEXCHEM RESOURCES BHD 2.800 12.00 2957.5 141.38 327.2 SCOMI ENERGY SERVICES BHD 0.030 -14.29 7.0 -45.45 14.0

QUALITY CONCRETE HOLDINGS BHD 1.150 11.65 1.7 -14.18 66.7 SC ESTATE BUILDER BHD 0.070 -12.50 5,730.8 -6.67 75.2

COUNTRY VIEW BHD 1.070 11.46 10.4 7 107 WONG ENGINEERING CORP BHD 0.585 -11.36 7,431.5 -21.48 147.5

TANCO HOLDINGS BHD 0.355 10.94 66108 47.92 617.4 FOCUS DYNAMICS GROUP BHD 0.040 -11.11 20,873.6 0.00 254.9

EVERGREEN FIBREBOARD BHD 0.770 9.22 16476.2 65.59 650.5 GIIB HOLDINGS BHD 0.080 -11.11 4,365.0 -38.46 47.3

REACH ENERGY BHD 0.060 9.09 55 0 65.8 BINA PURI HOLDINGS BHD 0.040 -11.11 1,093 -11.11 63.9

RUBBEREX CORP M BHD 0.705 8.46 16760 35.58 615 FITTERS DIVERSIFIED BHD 0.125 -10.71 44,187.6 -60.32 76

IQZAN HOLDING BHD 0.065 8.33 2677.9 30 14.4 CHEETAH HOLDINGS BHD 0.175 -10.26 13,491.9 59.09 85.1

HWA TAI INDUSTRIES BHD 0.720 7.46 4429.1 2.13 53.9 BARAKAH OFFSHORE PETROLEUM 0.045 -10.00 808.0 -43.75 45.1

SKB SHUTTERS CORP BHD 0.360 7.46 2755.8 -46.27 47.5 PDZ HOLDINGS BHD 0.045 -10.00 139.5 0.00 26.2

ADVANCE INFORMATION 0.145 7.41 352.6 11.54 38.6 AGESON BHD 0.265 -8.62 2,304.7 -55.83 27.5

MMAG HOLDINGS BHD 0.075 7.14 345.5 0 98.4 CSH ALLIANCE BHD 0.110 -8.33 14,633.5 15.79 152.0

BIG INDUSTRIES BHD 0.98 7.1 4169.7 12.64 62.2 SAUDEE GROUP BHD 0.060 -7.69 2,609.2 9.09 59.5

SYSTECH BHD 0.235 6.82 3382.4 2.17 81.3 FAST ENERGY HOLDINGS BHD 0.060 -7.69 1,545.5 -36.84 40.1

Data as compiled on Apr 21, 2022 Source: Bloomberg Data as compiled on Apr 21, 2022 Source: Bloomberg

Top gainers (ranked by RM) Top losers (ranked by RM)

NAME CLOSE CHANGE VOLUME YTD MARKET NAME CLOSE CHANGE VOLUME YTD MARKET
(RM) (‘000) CHANGE CAP (RM) (‘000) CHANGE CAP
(%) (RM MIL) (%) (RM MIL)

NESTLE MALAYSIA BHD 132.80 0.50 16.9 -1.04 31141.6 PETRONAS DAGANGAN BHD 21.70 -0.20 214.10 5.34 21558.0

HEINEKEN MALAYSIA BHD 24.14 0.38 87.7 15.83 7292.6 ANCOM NYLEX BHD 3.70 -0.13 1574.5 20.13 1070.0

TEXCHEM RESOURCES BHD 2.80 0.300 2957.5 141.38 327.2 HONG LEONG CAPITAL BHD 6.22 -0.13 2922.2 -14.56 1535.7

KUALA LUMPUR KEPONG BHD 28.28 0.260 2,905.9 29.84 30490.3 AXIATA GROUP BHD 3.58 -0.11 5971.5 -13.94 32853.0

CARLSBERG BREWERY MALAYSIA 21.62 0.240 192.5 7.67 6610.3 PETRONAS GAS BHD 16.90 -0.10 332.6 -5.56 33440.6

MALAYSIA SMELTING CORP BHD 5.43 0.230 1,976.4 67.08 2280.6 PMB TECHNOLOGY BHD 18.84 -0.10 55.7 53.42 4411.1

KOBAY TECHNOLOGY BHD 3.87 0.230 1848.4 -35.82 1254.6 AJINOMOTO MALAYSIA BHD 14.40 -0.10 23.0 -6.49 875.5

HONG LEONG BANK BHD 20.70 0.220 892.5 11.17 44871.8 SIME DARBY PLANTATION BHD 5.25 -0.09 6064.2 39.63 36307.5

HENGYUAN REFINING CO BHD 4.36 0.200 1777.6 12.66 1308.0 SARAWAK OIL PALMS BHD 6.47 -0.09 565.8 85.39 3729.5

TELEKOM MALAYSIA BHD 4.96 0.130 1616.3 -9.82 18717.6 WONG ENGINEERING CORP BHD 0.59 -0.08 7431.5 -21.48 147.5

ORIENTAL HOLDINGS BHD 7.03 0.130 259.3 33.9 4361.1 HARTALEGA HOLDINGS BHD 4.57 -0.07 2684.7 -20.24 15617.8

QUALITY CONCRETE HOLDINGS 1.15 0.120 1.7 -14.18 66.7 HONG SENG CONSOLIDATED BHD 2.65 -0.07 2621.7 -1.49 6768.7

GREATECH TECHNOLOGY BHD 4.12 0.120 3980.1 -38.78 5158.8 IJM CORP BHD 1.82 -0.07 2462.9 19.74 6426.6

COUNTRY VIEW BHD 1.07 0.110 10.4 7.00 107 GAMUDA BHD 3.68 -0.07 2455.1 26.90 9398.5

TA ANN HOLDINGS BHD 6.14 0.100 2361.0 74.93 2704.4 HARRISONS HOLDINGS MALAYSIA 5.35 -0.07 0.8 11.46 366.3

UWC BHD 3.45 0.100 808.3 -44.44 3799.7 AEON CREDIT SERVICE M BHD 15.54 -0.06 122.6 14.1 3967.5

PETRON MALAYSIA REFINING 4.94 0.1 341.7 12.79 1333.8 PADINI HOLDINGS BHD 3.35 -0.06 635.4 19.64 2204.0

PPB GROUP BHD 17.1 0.1 220.8 0 24326.5 AJIYA BHD 1.15 -0.05 3404.0 2.68 335.5

BRITISH AMERICAN TOBACCO M’SIA 12.98 0.1 209 -7.15 3706.2 AME ELITE CONSORTIUM BHD 1.7 -0.05 376.1 -10.05 1089.1

DKSH HOLDINGS MALAYSIA BHD 4.87 0.1 138.1 1.46 767.8 UMW HOLDINGS BHD 3.37 -0.05 23.1 13.47 3937.2

Data as compiled on Apr 21, 2022 Source: Bloomberg Data as compiled on Apr 21, 2022 Source: Bloomberg