Duopharma Biotech Bhd (DPHARMA) started off since 1978 and is principally involved in the manufacturing, distributing, importing and exporting of pharmaceutical products and medicines. DPHARMA owns and operates 3 manufacturing plants in Klang, Bangi and Glenmarie, Selangor with a portfolio of more than 300 generic drugs.

The FBM KLCI reversed last week’s gains as the key index succumbed to broadbased selling prior to the BNM’s interest rate decision during the Monetary Policy Committee (MPC) meeting; we believe traders may focus on banking stocks for the near term. Given the lacklustre trading and the increase in continuation of net foreign selling, we opine that the local bourse may see selling pressure interspersed with bargain hunting activities in undervalued stocks.

Kumpulan Fima Bhd (KFIMA) engages as a diversified group with core businesses in manufacturing, plantation, bulking, food sectors. Over at the manufacturing arm, the group is regarded as the largest domestic security printer in Malaysia which offers printing of travel documents, while the plantations sector comprises 18,877-ha of plantable area in Malaysia and Indonesia.

The FBM KLCI outperformed the regional peers as investors picked up beatendown shares, led by the banking and telecommunication & media heavyweights. While late-day rebound lifted Wall Street, we expect volatility to persist on the local bourse as inflationary pressure and recession fears still dominating the market. Investors are likely to stay cautious prior to the Malaysia’s interest rate decision and the US FOMC meeting (later this month).

The FBM KLCI ended 1H2022 in the negative territory as the key index dipped in the final-hour selldown. As Wall Street registering steep decline on the final trading session of 1H2022, we believe the weak sentiment is likely to spill over to the regional markets as well as the local bourse, which has been struggling to find a bottom. Meanwhile, concerns over inflation and recession continued to ripple through the market.

Heightened volatility was experienced due to (i) rising inflationary pressure, (ii) tension between Ukraine-Russia, (iii) hawkish Fed’s tone and (iv) recession fears. Given Malaysia has transitioned into endemic phase, it might benefit consumer & services sector with the reopening of business activities and upliftment of borders. We expect firm demand for the transportation & logistic sector moving forward. We like energy sector with the elevated Brent oil price, while the tech sector could see upward potential after a near-to-40% drop in the sub-index from the peak. We favour the banking industry under the interest rate upcycle environment.

The FBM KLCI dipped following three straight winning sessions, taking cue from the negative regional markets. The local bourse may see further volatility amid the quarter-end rebalancing activities. Meanwhile, new ceiling price for chicken to be set at RM9.40 per kg may be mildly positive for the poultry players, albeit the capping price is RM0.50 higher than the previous level.

For FY23f, we have imputed a FFB production assumption of 280,000MT (1QFY23 numbers makes up to 21.8% of our assumption). We expect production to improve in subsequent quarters as labour shortage issues may see some alleviation. Meanwhile, we take note that biogas plants at Keningau and Telupid mills are expected to commence operation to supply power grid by end of 2QFY23.