Cepat Wawasan Group Bhd (CEPAT) was incorporated since 2001 and currently owns and operates approximately 10,280-ha of oil palm plantations in Sabah in East Malaysia with milling capacity of 90MT/hr. In 2021, CEPAT achieved a CPO production of 51,968MT, PK of 12,348MT and FFB of 106,660 MT.

The FBM KLCI slid for the third straight session as investors took further profits in the banking heavyweights, while picking up shares in technology and energy sectors. We believe the local bourse is poised for a mild turnaround supported by bargain hunting activities especially in commodity and technology stocks given the flat overnight Wall Street movements. Nevertheless, downside risks include global inflation and the prolong Russia-Ukraine conflicts.

The FBM KLCI declined marginally into the negative territory as cautious sentiment persisted on the local bourse. Nevertheless, we expect to see bargain hunting activities across the sectors given the strong rebound on Wall Street overnight. We believe crude oil price to remain elevated for the near term on the back of reduced Russian output and larger-than-expected drawdown in the US inventories, thus inflationary pressure may not abate anytime soon.

On the first day of June, the FBM KLCI surrendered big gains from the previous session as global inflationary pressure remains a concern which may derail the economic recovery. Investors may trade cautiously following the overnight decline on Wall Street. Nevertheless, traders are likely to lookout on selected technology stocks with solid balance sheet and growing quarterly results (at least positive QoQ growth).

Evergreen Fibreboard Bhd (EVERGRN) history traces back since 1972 as a timber trading and veneer manufacturing company and subsequently expanded into manufacturing of medium density fibreboard, particleboard, furniture, value-added wood-based products & resin. To-date, EVERGRN has established plants, warehouses and offices across Malaysia, Thailand and Indonesia.

We expect the coal fired thermal power plant in Vietnam to remain as a key profit driver in FY22f and the foreseeable future. The group also aims to strengthen the power-related business with 2 MoU signed in 2021 for the (i) potential collaboration on the development in renewable energy plants such as solar and hydropower in Sabah and (ii) development of 1,500-MW liquefied natural gas (LNG) power project in Vietnam. At the same time, we gather that the progress of LSS4 project remains well on track and is slated for completion in 1Q23.

The FBM KLCI was traded higher due to the MSCI semi-annual review and we noticed trading value surged above RM6.12bn for the session with positive foreign inflows. Nevertheless, we believe the global sentiment may remain tepid as (i) Ukraine-Russia tension persists and (ii) elevated crude oil price may continue to put soaring inflation in focus; these factors may limit the upside potential on the recent relief rebound.

Occupancy rates at Plaza OSK, Faber Towers and Atria Shopping Gallery remains relatively healthy will generate stable recurring income, while the construction segment will be supported by an outstanding orderbook of RM211.0m (for their ongoing property development projects). With Malaysia transitioning into the endemic phase, we reckon that the industry segment is expected to deliver improvement on the back of smoother construction work progress. We also note that the loan portfolio remains stable at RM906.0m.