News Highlights - Petronas Dagangan, Pos Malaysia, Building Materials Sector, Plantation Sector

Petronas Dagangan Bhd (RM21.66/share)

Sets aside RM200m for capex

Petronas Dagangan Bhd (PDB), the retail arm of Petroliam Nasional Bhd (Petronas) has set aside RM200.0mil as capital expenditure (capex) to boost its recently acquired six downstream assets across Southeast Asia. PDB chairman Datuk Wan Zulkiflee Wan Ariffin said the capex will be spent on warehouses and construction of liquefied petroleum gas (LPG) terminals. To keep up with the year-on-year growth momentum, Wan Zulkiflee said PDB recently acquired six downstream companies from the Petronas group in the Philippines, Vietnam, Thailand and Malaysia. He said PDB has invested US$62 million (RM196 million) to bring Petronas Energy Philippines Inc (PEPI) and Duta Inc in the Philippines; Petronas Vietnam Co Ltd (PVL) and Thang Long LPG Co Ltd (TLLCL) in Vietnam; Petronas International Marketing (Thailand) Co Ltd in Thailand; as well as Petronas Aviation Sdn Bhd in Malaysia into its fold. – Business Times

Pos Malaysia Bhd (RM2.87/share)

Ventures into Islamic pawnbroking

Pos Malaysia Bhd continues its diversification by venturing into Ar-Rahnu, the Islamic pawnbroking business. The postal group has entered into a 80:20 joint venture with Bank Muamalat Malaysia Bhd (BMMB) to start Ar-Rahnu in selected Pos branches. The partnership will leverage Pos Malaysia’s extensive network of more than 700 outlets nationwide to minimized start-up and operating costs. Pos and BMMB are considered sister companies with a common shareholder, DRB-Hicom Bhd. DRBHicom holds 70% equity interest in BMMB and 32.21% in Pos Malaysia. In an announcement to Bursa, Pos Malaysia said it will inject RM16mil and BMMB RM4.0mil into the business. – The Edge

Building Materials Sector

New steel mill in Lumut

An integrated steel mill, to be built in Lumut, is expected to reduce the country’s steel import dependence by some RM6.0bil once it is fully operational by June 2015. Maegma Steel HRC Sdn Bhd director Tunku Shaharuddin Tunku Mahmud said the company would be investing RM4.5bil in the first phase of the project to build the plant, which would have the capacity to produce some 1.5 million tonnes of thin metal sheets, or “Hot Roll Coils” (HRC), a year. He added that once the plant is fully operational, it will have a capacity of producing three million tonnes per year, valued at RM6.0bil. The steel mill is located in Tanjung Hantu. Tunku Shaharuddin said the facility will cater to a majority of the country’s manufacturing companies from a wide range of industries. – Business Times

Source: AmeSecurities