Overall, occupancy rate has been gradually showing a mild uptrend move QoQ for majority of the buildings. As at 3Q22, the occupancy rate for older buildings aged more than 20 years which include UOA Centre, Wisma UOA II, and Wisma UOA Damansara I stood around 68.0-73.0%. For newer buildings such as Menara UOA Bangsar and UOA Corporate Tower, occupancy rate remained above 90.0%. Meanwhile, rental revision rate for 3Q22 remained flattish.

We gather that orderbook replenishment now stood at RM1.62bn, largely surpassing RM1.28bn recorded in FY21. Given that demand for from big data centers, electric vehicles, IoT and 5G applications are still in the picture, there is no slowdown in global wafer fabrication plant expansion plans. We believe that KGB is well positioned to ride onto the aforementioned growth and we made no changes to our orderbook replenishment assumption of RM1.20bn for FY23f.

Hung parliament is likely to contribute to the knee jerk sell down. The market may stabilise after the PM candidate is sent in at 2pm, but with some side effects. PN coalition – the market may avoid sin sectors, while focusing on shariah related. PH government – the market could focus on construction, telco and renewable energy, but may not be corporation-friendly. Traders may pick up apolitical sectors such as telco, utilities, O&G and consumer. Also, high net cash, low gearing and high dividend yield companies could be seen as good to accumulate during the knee jerk sell down.

The FBM KLCI eked out marginal gains on Thursday as buying interest emerged in the final hour ahead of the GE15. As Malaysia faced with a hung Parliament scenario after none of the coalitions won enough seats to form a majority, key focus is now on the outcome of the negotiations among various parties in today’s afternoon. Market sentiment may remain tepid and trade negatively before the submission of PM candidate name to Istana Negara at 2pm.

Following an increase of number of distributors from 806 in FY21 to 960 in FY22, NOVA remained committed to increase the number to 1,200 by FY25. With the construction of Phase 2 of its new plant well underway, we believe the upcoming additional capacity will allow the group to meet rising demand for nutraceutical products from distribution network expansion.

In view of a sustained repayment trend, ELKDESA raised its hire purchase receivables by 10.9% YoY and 3.8% QoQ to RM521.1m to capture a stronger demand for used-car hire purchase financing amid normalising economy. Contributing factors driving the demand include the popularity of online trading platforms for used car, as well as the revision of minimum wages to RM1,500.

The FBM KLCI ended on a downbeat note amid weakness in selected banking and plantation heavyweights, as the market sentiment remained cautious ahead of the GE15. With the softer market performance on Wall Street, we reckon that the market tone may stay tepid at least for the near term, as the key focus is shifted towards the outcome of the GE15, where it is still uncertain which party is having a lead at this juncture.

The poultry industry witnessed continuous increase in demand for eggs in the domestic and overseas market amid economic recovery. However, the elevated feed price could continue to hit TEOSENG’s margin with egg being placed under price control scheme. Hence, we remained cautious on the industry’s outlook until both the price and feed costs normalise.