Follow Us For The Latest Updates

Follow Us For The Latest Updates

TM-C41 took over the stock warrant space

Warrants Commentary (27 May to 31 May)

The Malaysian warrants market was revived last week following the shorter trading week in the preceding week, sporting a turnover of RM452.5mil, 63.0% higher than the preceding week. Telecommunications giant Telekom Malaysia (TM) reported a net profit of RM308.3mil for the first quarter ended 31 March  2019, almost doubling the net profit of RM157.2mil for the same period a year ago. The sizable growth can be attributed to a reduction in TM’s operating costs. The share price of TM soared 27.2% following the positive news to close at RM3.46 on Thursday (30 May), the highest level since August 2018. Call warrant TM-C41 was the most notable warrant over TM with RM3.0mil traded on Thursday (30 May) and a total RM7.7mil traded last week. TM-C41 tracked the underlying price movement closely, gaining a substantial 267.7% week-on-week (w-o-w).

Meanwhile, low cost carrier AirAsia Group (AirAsia) was another Malaysian listed company that made headlines last week. The company posted a 92.0% drop in net profit to RM96.1mil for the first quarter ended 31 March 2019, but declared a record-high special dividend of 90 sen per share. AirAsia shares extended their 5 days of gain to close at RM2.89 last Friday, posting the best weekly performance in the last 6 months. Call warrant AIRASIA-C83 came in second to TM-C41 on the top traded stock warrant list with a RM4.39mil turnover. On Thursday and Friday, we saw investors selling back a total of 1.8mil units of AIRASIA-C83 as the bid price surged 88.9% w-o-w.

In foreign news, the trade dispute between US and China escalated further last week as China has been reported to have plans to retaliate by restricting exports of rare earth minerals to the US (Reuters, 29 May), which could impact not just the tech sector, but the energy, automobile and defense industries as well. Global equities including the Hang Seng Index (HSI) futures were trading in the negative territory throughout the week, with the HSI futures finishing at 26,717.0 points last Friday. A total of RM351.5mil worth of HSI warrants were traded last week, capturing 77.7% of the total warrants market turnover. Put warrant HSI-H6S was the most active warrant last week with RM70.3mil traded, followed by call warrant HSI-C5Q with a turnover of RM59.4mil.

Top stock warrants by value traded:

Warrant nameValue
(RM’mil)
IssuerExercise priceExpiry date
TM-C417.72Macquarie3.5030 Sep 2019
AIRASIA-C834.39Macquarie2.8831 Oct 2019
DRBHCOM-C703.85CIMB1.8031 Oct 2019
MYEG-C653.43Macquarie1.5030 Sep 2019
MYEG-C683.23Macquarie1.8531 Oct 2019

If you have any questions or need further assistance, please do not hesitate to contact us email us at [email protected].

To view the full list of structured warrants available on Bursa Malaysia, kindly visit malaysiawarrants.com.my.

Provided for Malaysian residents information only. It is not an offer or recommendation to trade and is not research material. Past performance is not indicative of future performance. You should make your own assessment and seek professional advice.


Share:

Share on facebook
Share on twitter
Share on linkedin
Share on telegram

More Posts

market pulse

Still within consolidation mode

The FBM KLCI settled in red in tandem with the regional peers as selling pressure in the glove stocks returned, offsetting the gains on the banking heavyweights following the unchanged Overnight Policy Rate (OPR) by Bank Negara Malaysia. Tracking the losses on Wall Street overnight, we expect the local bourse may continue to consolidate further as market players are likely to trade on a cautious tone on the broader market. Nevertheless, we expect traders to position themselves for the recovery theme as Covid-19 vaccination is taking place. Meanwhile, the Brent oil price has surged firmly above USD65.

market pulse

Bank Negara’s OPR in focus

Bargain hunting activities emerged on the glove counters after more than one week of pullback, lifting the FBM KLCI and the healthcare sector higher. Market will be looking forward to the second Monetary Policy Committee meeting today to gauge market movements. However, economists anticipate an unchanged stance on the Overnight Policy Rate (OPR) amid expectation of an economic recovery. We believe the lower liners will continue to remain upbeat if the positive market sentiment persists. Meanwhile, the Brent oil price has seen a rebound.

market pulse

Streched valuations

Bucking the downturn across the regional markets, the FBM KLCI ended modestly higher as continued selling in glove heavyweights were offset by buying support in IHH and selected banking heavyweights. We believe the local bourse should trade in an upward bias tone following the change of MCO status for Selangor, Johor, Penang and KL. Meanwhile, the number of Covid-19 confirmed cases daily has dropped to year-to-date low. However, note that the negative sentiment on Wall Street overnight could cap the upside potential on the local front.

technical focus

Technical Focus – LHI

One of the largest fully integrated producers of poultry, eggs and livestock feed in Southeast Asia with strong presence in Malaysia, Indonesia, Vietnam and Singapore. Committed to expand the Malaysia, Philippines and Vietnam operations via additional capacities and infrastructures, whilst targets 160 Baker’s Cottage outlets by end-FY21 (from 103 outlets since end-FY20). Sequential earnings recovery is on the table, premised to the stabilising poultry prices in Malaysia as well as Indonesia in recent months. Technically, the flag-formation breakout above RM0.71 may lead price towards the immediate resistances at RM0.775-0.82, with long term target at RM0.885.

tm-c41-took-over-the-stock-warrant-space-m-online