1. business and industrial
2. energy
3. oil

FBM KLCI 1728.06
18.88
KLCI FUTURES 1734.50
22.00
STI 3345.11
46.75
RM/USD 3.5650
CPO RM2369.00
39.00
OIL US$51.52
0.37
GOLD US$1206.70
4.00
PP 9974/08/2013 (032820)
PENINSULAR MALAYSIA RM1.50
FRIDAY JANUARY 9, 2015 ISSUE 1876/2015
FINANCIAL
DAILY
MAKE
BETTER
DECISIONS
Seven detained
in hunt for Paris
media killers
www.theedgemarkets.com
4 HOME BUSINESS
Survey: Malaysia’s
middle class
wants RM1.9m
for retirement
4 HOME BUSINESS
Port tariff hike likely
this year, says CIMB
10 H O M E B U S I N E S S
Former FGV boss
Sabri Ahmad dies
18 H O M E
The new homeless
of Kuala Krai
20 P R O P E RT Y
Federall Republic
of
Fede
R
Germany land up
for sale
by
u
o
y
o
t
t
h
g
u
o
r
b
s
i
y
p
o
c
l
a
t
This digi
27 W O R L D
FBM KLCI 1728.06
18.88
KLCI FUTURES 1734.50
22.00
STI 3345.11
46.75
RM/USD 3.5650
CPO RM2369.00
39.00
OIL US$51.52
0.37
GOLD US$1206.70
4.00
PP 9974/08/2013 (032820)
PENINSULAR MALAYSIA RM1.50
FRIDAY JANUARY 9, 2015 ISSUE 1876/2015
FINANCIAL
DAILY
MAKE
BETTER
DECISIONS
www.theedgemarkets.com
4 HOME BUSINESS
Survey: Malaysia’s
middle class
wants RM1.9m
for retirement
4 HOME BUSINESS
Port tariff hike likely
this year, says CIMB
10 H O M E B U S I N E S S
Former FGV boss
Sabri Ahmad dies
18 H O M E
The new homeless
of Kuala Krai
20 P R O P E RT Y
Federal Republic of
Germany land up
for sale
Seven detained
in hunt for Paris
media killers
27 W O R L D
2
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
For breaking news updates go to
www.theedgemarkets.com
ON EDGE T V
www.theedgemarkets.com
Govt to revisit
trade figures
due to ringgit
depreciation:
Minister
Top Glove
forecasts
higher profit
amid fall in
material costs
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Singapore updates
tax guidelines
To better align with Western governments
SINGAPORE: Singapore is updating guidelines on an accounting
practice mired in controversy for
helping multinational companies
minimise their tax bills, as the city
state moves more in line with a
crackdown by Western governments on aggressive tax avoidance.
International taxation has come
under scrutiny since a quirk of
“transfer pricing” was found to
have helped lower the tax bills of
a number of multinationals, including Starbucks Corp, Google
Inc and Amazon.com Inc.
Such issues prompted the Organisation for Economic Cooperation and Development to call
on governments to revise tax treaties, tighten rules and share more
information, in a project due for
completion by the end of this year.
In transfer pricing, a company sets
a price for goods or services to be
sold between two of its subsidiaries.
The company can use the price
to minimise its tax bill by having a
subsidiary in a low-tax jurisdiction
such as Singapore sell products to
a subsidiary in a higher-tax jurisdiction at a high price. This allows
the company to book more of its
profit in the low tax location.
From Jan 6, the Inland Revenue
Authority of Singapore (Iras) will
require related parties to keep con-
temporaneous records to support
the pricing of such transactions.
The Iras also detailed methods
by which transactions were benchmarked to show that prices charged
would be similar if the transactions
had been with a party outside of
the company.
The new guidelines are also much
more specific about who is required
to prepare transfer pricing documentation and its content, said Henry Syrett, a partner at audit firm EY.
Singapore has attracted many
international companies thanks to
generous tax incentive programmes,
a reliable legal system, skilled labour,
and high living standards. — Reuters
Oil plunge leaves energy
bondholders at risk
BY NABILA AHM E D
NEW YORK: Investors who bought
more than US$50 billion (RM178
billion) of bonds sold by US energy companies are at risk of being
pushed lower down the ranks of
creditors as the firms prepare to issue more debt to preserve liquidity
amid plunging oil prices, according
to Moody’s Investors Service.
Junk-rated oil companies that
funded exploration and production
with debt are the most vulnerable
to the price of oil, which has fallen by more than half since June,
Moody’s analysts led by Alexander
Dill wrote in a report yesterday. They
are expected to turn to second-lien
financing as the value of their energy reserves declines, Moody’s said.
Such debt ranks higher than unsecured bonds and its investors would
stand in front of existing bondholders in the event of a default.
Speculative-grade energy producers have sold US$90 billion of bonds
Oil firms are preparing to issue more debt to
preserve liquidity amid plunging oil prices.
in the past three years as companies have relied on debt financing to
make up for cash shortfalls as they expanded. With the US Federal Reserve
keeping interest rates at historic lows,
investors searching for yield have
piled into the debt, pushing energy
bonds’ share of the speculative-grade
market to 17% since 2008, according
to an Oct 14 report by Citigroup Inc.
“Investors have been willing to
accept the yield so far but their day
of reckoning will come,” Dill, Moody’s
New York-based head of covenant research, said in a telephone interview.
Moody’s found that 87%, or
US$21.7 billion, of bonds issued
by midstream oil and gas companies, and 86%, or US$3.2 billion, of
bonds issued by propane producers
have structures that allow new lenders to trump existing bondholders.
The figures are extrapolated from
the Moody’s database which includes most of these bonds issued
between 2011 and 2014, Dill said.
“These companies also have poor
protection overall because they are
master limited partnerships, which
are required to distribute substantially all of their cash to their owners,” according to the report.
Investors who buy any new second-lien bonds issued by energy
companies are expected to receive a
higher yield, Dill said. “Second-lien
debt is going to cost more,” he said.
— Bloomberg
US jobless claims dip, 2014 layoffs lowest in 17 years
BY LUCIA M U TI K ANI
WASHINGTON: The number of
Americans filing new claims for
unemployment benefits fell last
week and job cuts declined for a
second straight month in December, adding to signs of a strengthening labour market.
Initial claims for state unemployment benefits slipped by 4,000 to a
seasonally adjusted 294,000 for the
week ended Jan 3, the Labor Department said yesterday. While that was
a bit less than Wall Street’s expectations of a drop to 290,000, the trend
in claims remained consistent with
a steadily tightening labour market.
At current levels, claims probably
have little room to fall further.
The four-week moving average of
claims, considered a better measure of labour market trends as it
irons out week-to-week volatility,
dipped by 250 to 290,500 last week.
It has remained below 300,000 for
17 straight weeks.
US stock futures held gains and
US Treasuries trimmed losses after
the data. The dollar was up against
a basket of currencies.
In a separate report, global out-
placement consultancy Challenger,
Gray & Christmas Inc said the number of job cuts announced by US
employers fell 9.2% in December.
For the whole of 2014, employers
announced a total of 483,171 job
cuts. That was 5% fewer than in 2013
and the smallest number since 1997.
“This bodes well for job seekers
who will not only find more employment opportunities in 2015,
but will enjoy increased job security once they are in those new
positions,” said John A Challenger,
chief executive officer of Challenger, Gray & Christmas. — Reuters
IN BRIEF
Indonesia cracks down
on cheap fares to boost
airline safety
JAKARTA: Indonesia has
cracked down on the sale of
cheap tickets for domestic
flights to ensure that airlines
do not cut corners on safety,
the transport ministry said yesterday. The decision to tighten the rules on the fares came
into effect on Dec 30, two days
after Indonesia AirAsia flight
QZ8501 crashed into the Java
Sea. The price floor for economy class domestic flights has
been raised, according to ministry documents seen by Reuters, with airlines prevented
from selling tickets at less than
40% of a ceiling price set by the
ministry. — Reuters
Modi throws open doors
to people of Indian origin
around the globe
NEW DELHI: Prime Minister
Narendra Modi yesterday appealed to millions of people of
Indian origin across the world
to turn to their homeland after
he eased visa rules to lure overseas talent, in a bid to make the
country a top power. India has
the world’s second largest diaspora after China, with more
than 25 million people settling
overseas since colonial times,
from Guyana in South America to Singapore in East Asia.
Modi’s desire to harness the
group’s skills and resources is
bolstered by his Hindu nationalist leanings towards reasserting India’s position as a global
leader with a unique civilisation stretching back thousands
of years. — Reuters
New Delhi fires employee
who skipped work for
24 years
NEW DELHI: AK Verma, an executive engineer at the Central Public Works Department,
was fired after last appearing
for work in December 1990.
“He went on seeking extension
of leave, which was not sanctioned, and defied directions to
report to work,” the government
said in a statement yesterday.
Even after an inquiry found him
guilty of “wilful absence from
duty” in 1992, it took another 22
years and the intervention of a
cabinet minister to remove him,
the government said. — Reuters
Porsche expects sales to
reach 200,000 cars this
year — CEO
STUTTGART (Germany): Porsche AG said it expects to increase sales to 200,000 cars or
more this year, hitting a longplanned target three years early, after posting record deliveries in 2014. Sales in December
surged 39% from a year earlier
to 20,644 sports cars and sport
utility vehicles (SUVs), boosting
full-year deliveries to a record
189,849, Porsche said yesterday.
That marked a 17% gain on 2013
levels. More than two-thirds of
Porsche models sold are SUVs,
thanks to its new Macan model
which hit dealerships last April,
sales data showed. — Reuters
4 HOME BUSINESS
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
tariff hike likely
Malaysia’s middle Port
this year, says CIMB
class wants RM1.9m
for retirement
BY C Y N T H IA B L E MIN
Almost half thinks financial security can never be achieved
BY SU PRI YA SU RENDRAN
KUALA LUMPUR: The average
amount that Malaysia’s middle-class segment desires to have
for retirement is RM1.9 million,
according to a survey conducted
by the AIA group.
In the survey on “Hopes and
Aspirations of the Middle Class in
Asia”, Malaysia’s middle class said
saving for retirement is a serious
challenge, with 33% citing enjoying a comfortable retirement as the
most difficult goal to achieve in life,
and 53% stating they are worried
they can’t save enough for a comfortable retirement.
AIA Bhd chief marketing officer
Thomas Wong said Malaysian respondents had indicated a variety
of investment instruments for their
retirement plans.
“These investment instruments
include contributions to regular
retirement plans (70%), investing
in the stock market (70%), real estate (61%), and contributing to a
regular savings account (50%),”
he told a press conference after
a panel discussion on the survey
results yesterday.
The survey was conducted in
2014 among 3,000 self-identified
middle-class individuals from six
Asean markets, namely Malaysia, Indonesia, the Philippines, Singapore,
Thailand and Vietnam, through online and face-to-face interviews.
In Malaysia, the survey was conducted among 500 respondents aged
25 years and above and living in
Peninsular Malaysia, with an average household income of RM6,339
per month.
(From left) AIA Asia regional director for family focus Lee Wee Min, National
Population and Family Development Board deputy director-general (policy) Dr Anjli
Doshi-Gandhi and Wong after the panel discussion. Photo by Sam Fong
These Malaysian respondents
have, on average, RM160,000 in
assets, considerably higher than
those in Thailand, Vietnam, Indonesia and the Philippines.
Besides retirement, the survey
covered areas such as quality of
life and financial security as well
as family and education.
On financial security, 53% of
Malaysian respondents believe that
it can be achieved in their lifetime,
while 47% of them feel that it is a
never-ending pursuit.
“Generally the Malaysian middle class has a higher expectation
on how much is needed to achieve
financial security compared with
other Asean markets surveyed. On
average, Malaysian respondents
said they need RM1.5 million in
asset value in order to feel financially secure,” said Wong.
By contrast, on average, the
middle-class groups in Thailand,
the Philippines and Indonesia
feel they need about RM360,000,
RM864,000 and RM451,000 respectively to feel secure.
One concern raised by the Malaysian middle class is rising healthcare costs, with 51% stating that
they are concerned about the cost
of healthcare, and 46% stating that
they are concerned about the cost
of unexpected emergencies.
On the 2015 outlook for healthcare costs, Wong said this will still be
a concern due to factors such as advancement in medical technology.
“We don’t think that the rising
healthcare cost trend is going to
change too much, simply because
of factors such as advances in medical technology, which translate
into higher healthcare costs. These
will fuel medical inflation to an extent,” he said.
KUALA LUMPUR: Port Klang, comprising Northport and Westports,
is likely to see a tariff hike this year,
which will be one of the key catalysts
for Westports Holdings Bhd’s share
price in 2015, said CIMB Research.
When contacted, Westports chief
executive officer Ruben Emir Gnanalingam told The Edge Financial
Daily that the Port Klang Authority
(PKA) had submitted a proposal
to the Transport Ministry for the
port tariff to be reviewed last year.
The tariff rates in Port Klang are
set by the Transport Ministry and
regulated by the PKA.
“We actually don’t have much
clarity [on whether or not the
much-awaited tariff hike will be
announced] at the moment,” said
Ruben, noting that the last tariff
review was in 2002.
“Some [of the port charges have
not been reviewed] even longer. As
such, it [a hike] is definitely due,”
he said. There are different charges
for different types of boxes, such
as 20-foot boxes, 40-foot boxes,
45-foot boxes, refrigerated boxes,
storage charges or transshipment.
“I am sure the ministry is looking
into it carefully and will come back
to us when they have completed
their review. Until then, anything
we say would be pure speculation,”
said Ruben.
NCB Holdings Bhd group managing director Abi Sofian Abdul Hamid concurred, adding that Northport, on its part, had submitted
the necessary documentation to
the PKA to support the tariff hike.
“A tariff hike will be good for us,
although industry observers may
say that we are passing on the cost
to them,” he told The Edge Financial
Daily yesterday. “To date, there has
yet to be any update on the status
of the tariff hike.”
Still, an industry source said
the government is unlikely to push
through plans to increase the tariff this year given the plummeting
crude oil prices and the devastation
caused by the floods.
“The government may not be in
favour to push it for the time being,
although both the terminal operators
have been lobbying for a tariff hike as
that could significantly improve their
earnings,” the source said.
In a sector report dated Jan 7,
CIMB Research said following its visit
to Northport last month, the latter’s
management said a 20% tariff hike
was insufficient given that rates were
only increased every 10 to 15 years.
“[Thus,] our view is that a 30%
tariff hike is the most likely scenario,” said the reseach firm.
A tariff hike will be
good for us, although
industry observers may
say that we are passing
on the cost to them.
“We believe that Northport’s new
15.7% shareholder, MMC Corp Bhd,
is likely to exert [a] positive influence
to push the tariff hike through and
this will be one of the key catalysts
for Westports’ share price this year
in our view,” CIMB Research said.
“Westports is in a strong competitive position in Port Klang, and we
expect it to enjoy multiple catalysts
to its share price this year, including a likely tariff hike, an increase
in transshipment volumes from the
start of the Ocean Three [shipping]
alliance, and the high chance of
getting a renewal of its investment
tax allowance,” it noted.
CIMB Research said the Ocean
Three alliance of CMA CGM, China
Shipping and United Arab Shipping
Co — Westports’ three largest customers — is on track for implementation from this month onwards.
CIMB Research is maintaining
an “add” recommendation on Westports, with a target price of RM4.57.
Westports stock ended 10 sen or
3.03% higher at RM3.40 yesterday,
giving it a market capitalisation of
RM11.59 billion, while NCB shares
were 12 sen or 5.08% higher to settle
at RM2.48, bringing a market cap
of RM1.17 billion.
IJM Corp expects construction orders to hit RM7b by FY16
BY A H MA D NAQ I B IDR IS
KUALA LUMPUR: IJM Corp Bhd
aims to secure another RM1 billion worth of construction projects to grow its order book to a
record RM7 billion by the start of
financial year ending March 31,
2016 (FY16), from its current size
of over RM6 billion.
IJM Corp chief executive officer
(CEO) and managing director Datuk Teh Kean Ming said the group
is targeting to secure those projects
before end-FY15.
He said the group had pre-qualified for the tender of the KL118
development, formerly known as
Warisan Merdeka, and could also
be tendering for the Klang Valley
Mass Rapid Transit 2 project when
bidding commences.
“We have over RM6 billion contracts, [if ] plus another RM1 billion, I think our order book could
potentially reach RM7 billion by
the start of FY16,” Teh told reporters after the group’s extraordinary
general meeting (EGM) yesterday.
He said the RM7 billion orders
should keep the group busy for the
next three to four years.
At the EGM yesterday, IJM Corp’s
shareholders “unanimously” passed
the resolution for the privatisation
of IJM Land Bhd for a total consideration of RM1.98 billion, to be satisfied by an issuance of 280 million
shares amounting to RM1.86 billion
and cash consideration of approxi-
mately RM0.12 billion.
“We are pleased to say that the
resolution was unanimously carried
out, with 927 million shares voting for
the privatisation exercise,” said Teh.
Post-privatisation, Teh sees IJM
Land being able to take on larger-scale projects, while leveraging
on IJM Corp’s financial strength
and resources.
IJM Land currently has 4,900
acres (1,983ha) of undeveloped
land bank, with a gross development value (GDV) of RM30 billion.
“We already have the land bank.
Now we want to work on a larger
scale in terms of capacity and financial strength,” said Teh.
In 2015, IJM Land CEO and managing director Datuk Soam Heng
Choon said the company will be
embarking on phase two of The
Light Waterfront project in Penang,
phase five of Bandar Rimbayu in
the Klang Valley, 176 shop offices
in Seremban 2, and Sebana Cove
and Nasa City in Johor.
He said IJM Land has launched
projects worth RM2 billion in GDV
since the start of its current financial year, leaving the company with
a balance of RM1 billion worth of
projects to be launched in January.
He said the company is looking
into property investment as a new
business segment, leveraging on
the stronger financial position of
the group post-acquisition.
“With the stronger balance
sheet that we have, we can actu-
ally restrategise our business. We
could probably start another sector
on property investment to leverage
on the yield income, rather than
purely property development,”
said Soam.
He said the property investment
business would not take a real estate investment trust structure, as
the company would invest in its
own assets.
There is no fixed timeline yet for
the new business segment, Soam
said.
IJM Corp closed unchanged at
RM6.59, with a market capitalisation of RM9.82 billion, while IJM
Land rose eight sen or 2.42% to
RM3.38, translating into a market
cap of RM5.27 billion.
6 HOME BUSINESS
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
CIMB, RHBCap
may revise terms of
US$12.9b merger
Renegotiation possible after lower earnings reported
KUALA LUMPUR: CIMB Group
Holdings Bhd and RHB Capital
Bhd are considering changing the
terms of a proposed US$12.9 billion
merger that would create Malaysia’s largest banking group, people
with knowledge of the matter told
Bloomberg yesterday.
The newswire reported that RHBCap investors may oppose the allstock deal after CIMB shares tumbled
24% as of yesterday’s close since the
transaction was announced in October, said the people, who asked not
to be identified because the deliberations are private. RHBCap shares
dropped 14% in the same period.
The banks may need to renegotiate terms of what could become
the nation’s biggest-ever merger after both reported lower earnings in
the most recent quarter. The stock
exchange has ruled that RHBCap’s
largest shareholder, the Employees
Provident Fund (EPF), can’t vote on
the deal, making it more important to
convince other investors of its merits.
Including the proposed acquisition of smaller lender Malaysia Building Society Bhd (MBSB), the deal
would be valued at RM53.6 billion,
data compiled by Bloomberg show.
Lois Kam, a spokesman for RHB-
Cap, said by email there is “no new
development” to announce at this
time. Effendy Shahul Hamid, chief
marketing and communications officer at CIMB, declined to comment
when contacted by phone.
Bloomberg added that the proposed transaction was structured
as a reverse merger, with smaller
RHBCap to issue shares to acquire
CIMB, Malaysia’s largest bank. That
method was seen as a way to overcome potential opposition from RHBCap’s second largest shareholder,
Aabar Investments PJSC, which paid
RM10.80 a share when it bought its
stake in 2011.
The steeper drop in CIMB shares
means the transaction has become
less favourable to RHBCap investors.
The companies are now discussing
whether terms of the merger will
need to be changed, and no final
decision has been made, the people
said. The transaction is still pending
approval from the central bank. The
banks are expected to complete due
diligence on the deal by the end of
January, the people told Bloomberg.
The proposed combination would
see RHBCap issue one share for every
1.38 CIMB shares, according to an
Oct 9 statement. At the time, the
merger valued CIMB at RM7.267 a
share, a stock exchange filing showed.
CIMB’s share price closed yesterday
at RM5.29.
As part of the deal, CIMB will
acquire MBSB’s business at a fixed
price of RM7.8 billion and create a
“mega-Islamic bank,” according to
the October filing. Bursa Malaysia
ruled in late October that the EPF
can’t vote on the deal. The fund is
RHBCap’s largest investor with a
40.9% holding, and also owns stakes
in CIMB and MBSB, data compiled
by Bloomberg show.
CIMB said in November its third
quarter profit fell 16% to RM890 million, hurt by higher loan impairments
in Indonesia. RHBCap’s net income
for the period slipped 2.5% to RM545
million. CIMB’s own banking analyst, Winson Ng, in December recommended investors to be “underweight” on bank stocks. He said in
a research report that “weak loan
momentum” and narrower margins
would hurt revenue growth, according to Bloomberg.
Potential provisioning differences have been uncovered during due
diligence on the merger, The Edge
reported last month, citing unidentified people.
Independent
committee for Tanjung
BY C Y NTHI A B L E M IN
KUALA LUMPUR: Tanjung Offshore Bhd, which recently aborted a proposed reverse takeover
(RTO) by Paris-based oil and gas
giant Bourbon SA, has set up an
independent committee to “review
and make recommendations on
matters arising from recent media
reports on the company”.
In a filing with Bursa Malaysia
yesterday, Tanjung Offshore said
the three-member panel will comprise its independent directors
George William Warren Jr, Datuk
Ab Wahab Ibrahim and Shahrizal
Hisham Abdul Halim (pic).
On Dec 29, the company told Bursa its deal with Bourbon SA had been
called off. The announcement came
following an article titled, “Tanjung
Offshore to abort Bourbon RTO
deal?” that appeared in The Edge
Financial Daily on the same day.
Tanjung Offshore said then it had,
together with Singaporean Farid
Khan Kaim Khan and his business
partners, Mower Tunggal Jaya PT,
Megagold Indonesia PT, and Zona
Maju Mapan PT (BNI shareholders)
and their business partners, as well
as Bourbon Far East Pte Ltd, mutually agreed to terminate the heads of
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KLK disposes of 20% stake in KLK
Premier Capital for RM154m
BY L E V IN A L IM
KUALA LUMPUR: Kuala Lumpur
Kepong Bhd (KLK) is disposing of
a 20% equity interest in its wholly-owned subsidiary, KLK Premier
Capital Ltd, for US$44 million or
RM154 million cash.
In a filing with Bursa Malaysia, KLK said it, together with
KLK Premier Capital, signed a
share purchase agreement yesterday to dispose of the former’s
20% equity interest to its longtime Japanese partner, Mitsui
and Co Ltd.
“Mitsui shall acquire from KLK
2.36 million ordinary shares and
84,500 redeemable preference
shares in KLK Premier Capital,”
said the plantation giant, adding
that its cost of investment in the
unit was US$54.06 million since
Sept 12, 2013.
“As Mitsui is KLK’s long-term
business partner, the proposed
disposal will allow KLK to leverage
on Mitsui’s business/marketing
relationships in the PRC (People’s
Republic of China) and technological expertise in oleochemical downstream manufacturing
activities,” said KLK.
KLK Premier Capital owns
100% equity interest in Taiko
Palm-Oleo (Zhangjiagang) Co
Ltd (TPOZ), The proposed disposal is conditional, among others,
upon the injection of US$50.3 million by KLK/KLK Premier Capital
into TPOZ, to fund the latter’s expansion of its plant capacity and
product range.
The deal is expected to be completed in the first quarter of this
year, or on any other date mutually agreed upon.
It is expected to result in a gain
before tax to KLK of approximately
US$33.3 million.
Former IGP listed as substantial
Astro shareholder
BY C H E S T E R TAY
KUALA LUMPUR: Former Inspector-General of Police (IGP) Tun
Hanif Omar is listed as a substantial shareholder of Astro Malaysia
Holdings Bhd, according to the
pay TV operator’s filing with Bursa
Malaysia yesterday. However, he
has no economic interests in such
shares, the filing added.
According to the filing, Hanif,
75, “is deemed to have an interest in 462.12 million shares or an
8.88% stake in Astro by virtue of
his 25% direct equity interest in
Harapan Terus Sdn Bhd”.
Harapan Terus’ deemed interest in the Astro shares arises
through its wholly-owned subsid-
iaries, namely Berkat Nusantara
Sdn Bhd, Nusantara Cempaka
Sdn Bhd, Nusantara Delima Sdn
Bhd, Mujur Nusantara Sdn Bhd,
Sanjung Nusantara Sdn Bhd and
Gerak Nusantara Sdn Bhd.
“The Harapan Terus subsidiaries hold such Astro shares under
discretionary trusts for bumiputera objects. As such, they do not
have any economic interest in
such Astro shares as such interest is held subject to the terms of
such discretionary trusts,” said
Astro in the filing.
Astro retreated one sen or
0.33% to RM3.02 yesterday, with
3.68 million shares traded. It had a
market capitalisation of RM15.76
billion.
MMC Corp MD Che Khalib joins
NCB board
KUALA LUMPUR: Port operator and logistics services provider NCB Holdings Bhd has appointed MMC Corp Bhd group
managing director Datuk Seri Che
Khalib Mohamad Noh, 49, to its
board as a non-independent and
non-executive director.
“Datuk Seri Che Khalib represents the interest of MMC Corp
through its wholly-owned subsidiary MMC Ventures Sdn Bhd, which
has [a] 15.73% interest in NCB,” the
group said in its filing with Bursa
Malaysia yesterday.
NCB on Nov 27 last year announced that MMC Corp, controlled by tycoon Tan Sri Syed
Mokhtar Al-bukhary, had acquired 73.99 million shares or
15.73% stake from MISC Bhd,
via an off-market direct business
transaction.
NCB counts Permodalan Nasional Bhd as its largest shareholder
with a total of 53.77% stake, while
pension fund Kumpulan Wang Persaraan has a 9.18% interest.
sian Association of Asean Young
Entrepreneurs here yesterday.
He said the ministry would revisit its forecast figures on foreign
direct investments and export value
for electrical and electronic prod-
ucts in view of the current ringgit’s
performance.
“The ringgit has pluses and minuses in terms of impact. We will
do more detailed calculation,” he
said. — Bernama
BY S UL H I A Z MA N
agreement they had entered into in
relation to the proposed RTO.
It also noted that the parties had
decided to mutually terminate the
deal as the economic and financial
conditions for an agreement that
is satisfying for both parties cannot be met in view of the declining
oil prices.
Miti sees challenging year ahead for trade sector
KUALA LUMPUR: The trade sector
may face challenging prospects
this year, said International Trade
and Industry Minister Datuk Seri
Mustapa Mohamed.
Mustapa said a team of experts
from his ministry is currently working
on the trade forecast figures for 2015.
“The team is looking at the impact of current oil prices, the economy, balance of payments, fiscal
deficit as well as the goods and
services tax. The figures will be announced in several weeks.
“The year 2015 is challenging.
More detailed analysis is needed
[for a clearer picture],” he told reporters after launching the Malay-
8 HOME BUSINESS
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
M’sia needs to revise Budget 2015
To account for rapid decline in crude oil prices, says Credit Suisse
BY A FI Q I SA
SINGAPORE: It is timely for Malaysia to revise its Budget 2015 to
account for the rapid decline in
crude oil prices, which could potentially stall its fiscal deficit target, said Credit Suisse director and
head of Malaysia equity research
Tan Ting Min. “They [the Malaysian government] definitely have to do a revision because Budget 2015 used
an oil price assumption of US$100
(RM357) per barrel. As a result, we
think it will be very difficult for
them to hit the fiscal deficit target
of 3% this year,” Tan told a media
briefing on the sidelines of Credit
Suisse’s 4th Annual Macro Conference and 6th Annual Asean Conference here yesterday.
The government has trimmed
its fiscal deficit to 3.9% of gross
domestic product (GDP) in 2013
and is expected to further reduce
it to 3.5% in 2014. A slew of rationalisation measures, particularly the
Tan said the prospect of the government
not being able to meet its fiscal deficit
reduction target could have serious
ramifications for Malaysian equities.
removal of the fuel subsidy from
Dec 1, 2014, to a managed float
system, has eased the pressure on
government expenditure. Previously, the government had
indicated that it intended to have a
balanced budget by 2020.
Since Prime Minister Datuk Seri
Najib Razak presented Budget 2015
Malaysia’s foreign
reserves fall 14% to
lowest since 2011
KUALA LUMPUR: Malaysia’s foreign-exchange reserves dropped to
the lowest level since March 2011,
a sign that the central bank may
have intervened to stem a slide in
Southeast Asia’s worst-performing
currency.
The holdings fell 14% to
US$116 billion (RM414 billion)
as of end-December 2014 from a
year earlier, Bank Negara Malaysia (BNM) data showed yesterday. They declined 4% from the
previous fortnight. The ringgit has
weakened 10% since June 2014
and dropped to a five-year low of
RM3.5862 a US dollar yesterday.
It closed 0.4% higher at RM3.5665
yesterday.
A slide in global crude oil prices has put pressure on the ringgit,
posing a revenue risk for oil-exporting Malaysia, which is seeking
to lower the fiscal deficit to 3% of
gross domestic product in 2015
from 3.5%. The central bank may
have intervened in the first two
weeks of December to stem the
currency’s slide, UBS AG strategists
including Gareth Berry wrote in a
research note earlier yesterday.
Malaysia’s foreign reserves were
supported by a bigger current account surplus and foreign direct
investment inflows in 2014, BNM
said in a statement. The holdings
can finance 8.4 months of retained
imports and are 1.1 times the
short-term external debt, it said.
“The reserves are expected to
remain ample in 2015, supported
by trade and investment inflows,”
BNM said.
The central bank told local lenders last month to guard against
speculation in its currency. All
short-dated transactions requiring the exchange of ringgit for a
foreign currency must be backed
by documentation, BNM said in
a Dec 4 statement.
Concern about the nation’s finances is already starting to show
in the local-currency debt market,
where global funds reduced holdings of Malaysian government and
corporate debt in November by
5.8%, the most since September
2011, to RM236.5 billion, official
data showed Dec 31.
The reserves are
expected to remain
ample in 2015,
supported by trade
and investment
inflows.
The impact on the ringgit from
the drop in oil is “amplified by the
heavy foreign presence” in bonds
and equities, the UBS report said.
Valuation effects will distort yesterday’s reserves numbers, magnifying any drop, as the US dollar
rally into year-end lowered the
US currency value held in other
currencies, it said. — Bloomberg
back in October, the Brent crude
price has fallen from US$100 to just
above US$50 presently. It is worth
noting that at present, the government has yet to indicate when and
how it intends to have a relook at
the country’s projected petroleum
earnings, which would amount to
far less at present oil prices.
Oil and gas-related income is a
backbone of the Malaysian economy as it currently accounts for 30%
of the government’s total revenue.
To account for lower petroleum revenue contribution from
Petroliam Nasional Bhd (Petronas), an alternative for the government would be to request the
state-owned oil major to increase
the quantum of its dividend payment this year. Petronas paid the
government dividends amounting
to RM28 billion in 2012 and RM27
billion in 2013.
“However, there has to be a limit.
If oil price stays at US$50 per barrel,
you can’t expect Petronas to pay the
government the same amount as
it did in previous years,” said Tan.
A revision in the national budget
is widely expected by observers, especially after Saudi Arabia revised
its own oil price assumptions for
its budget from US$100 per barrel
to US$60 per barrel. After adjusting for lower oil prices, the Saudi
government projected a deficit of
US$38.6 billion this year.
A further decline in oil prices
and a weakening ringgit would both
spell lower revenues for the Malaysian government in spite of the
substantial savings arising from the
removal in oil subsidies.
Tan said the prospect of the government not being able to meet its
fiscal deficit reduction target could
have serious ramifications for Malaysian equities.
“Malaysia was already one of the
worst-performing markets in the
region last year. We have started
the year with the ringgit weakening further and oil prices have continued to fall, which has certainly
dampened investors’ sentiments
further,” she said.
However, a silver lining would
be that the markets should have
factored in the negatives by the
second half of this year, she added.
“The market may have factored
in some of the downside expectations from lower oil prices, but
weaker economic data and the
implementation of the goods and
services tax in April could mean a
rather tricky first half of the year.”
In a Dec 5 strategy note, Credit
Suisse said the market was too optimistic about Malaysia’s corporate
earnings outlook this year with an
expected growth of 9.2% year-onyear. The firm believes that this is
unachievable, and is instead projecting negative earnings momentum going forward.
Credit Suisse favours the construction, telecommunications and
plantation sectors as the most promising. Its “top buy” recommendation
includes Axiata Group Bhd, Gamuda
Bhd, Astro Malaysia Holdings Bhd,
and Genting Plantations Bhd.
Business confidence and consumer sentiment
to affect REITs performance
MOHD IZWAN MOHD NAZAM
BY AHM AD NAQI B I DRI S
KUALA LUMPUR: Rental reversion
— the main income for real estate
investment trusts (REITs) — is largely
dependent on business confidence
and consumer sentiment, and both
seem to be sluggish this year.
Consumer sentiment is expected
to be weak this year — no surprises
there — due to a higher cost of living
and the implementation of the goods
and services tax (GST) on April 1.
Business confidence also does not
seem to be faring any better, what
with the continued slump of the ringgit and global oil prices seen in the
first week of the new year. The FBM
KLCI lost 2.5% to 1,709.18 points
on the first six days of the year before snapping the downward trend
yesterday after gaining 18.88 points
or 1.1% to settle at 1728.06 points.
AllianceDBS Research Sdn Bhd
analyst Marvin Khor told The Edge
Financial Daily that the generally
softened consumer sentiment could
dampen prospects for rental reversion. He said rental for the office
segment will be particularly pressured as the segment continues to
be plagued by a supply glut, while
older buildings are expected to see
increasing vacancy rates.
For the retail segment, Khor expects positive rental reversion for
well-located assets.
“We think retail REITs with assets
in prime locations would be more
likely to secure positive reversions,
as retailers should want to maintain
their locations in key addresses, regardless of which stage the economic
cycle is in. Nonetheless, it will still be
subject to the level of rents tenants
will be able to absorb,” he said.
2015
OUTLOOK
Hence, Khor expects retail REITs
will generally fare better than office
REITs this year. However, he cautioned that rental and occupancy
in suburban areas may come under
pressure going forward, due to the
increasing supply of rental space.
Still, he said it will be positive for
REITs if the central bank maintains
the overnight policy rate (OPR) next
year, which he thinks is likely.
“Our economist is no longer expecting any OPR hikes in 2015 due to
a more subdued economic outlook,
which is positive for yield-curve sensitive securities like REITs,” he said,
adding that any unexpected and significant changes in the interest rate
could cause a rerating for the sector.
For now, AllianceDBS maintains
a “neutral” rating on the REIT sector, with Sunway REIT as its top
pick, due to its high potential for
inorganic growth as it will soon
complete the refurbishment of Putra Place, and possible asset injections from Sunway Bhd.
Meanwhile, Malaysian REIT Managers Association chairman Datuk
Stewart LaBrooy (pic) said macroeconomic factors, like weaker commodities, will be a key determinant
of REITs’ performance this year.
“The impact of oil prices on Malaysia’s economy and its effects on
government spending, consumer
and business confidences, are go-
ing to be the main talking point in
2015,” LaBrooy told The Edge Financial Daily.
If the current weakness in the
market persists, LaBrooy, who is also
chief executive officer of Axis REIT,
expects companies to enter into sale
and leaseback agreements to bolster
their balance sheets this year.
“REITs have the advantage of long
leases and secure tenants, which allow them to transact in a challenging
market environment, leveraging on
their [tenants’] financial stability,”
he said.
However, he admitted that the
oversupply of space in the Greater
Kuala Lumpur region, particularly
for office and retail spaces — will
pose a challenge for REITs in those
segments.
But there’s a silver lining for the
industry, according to LaBrooy,
who thinks that the measures employed by the government to cool
down the property segment could
work to REITs’ advantage.
“We are seeing more assets becoming available for sale to REITs,
with accretive yields, following the
cooling measures taken by Bank
Negara Malaysia on property transactions,” he said.
10 H O M E B U S I N E S S
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
Top Glove keeps
10% FY15 net profit
growth target
Maintains forecast despite higher operating costs
SHAH ALAM: Top Glove Corp Bhd,
the world’s largest rubber glove
maker, is keeping its 10% net profit
and revenue growth forecast for the
financial year ending Aug 31, 2015
(FY15), even though its chairman
Tan Sri Lim Wee Chai recognises that a double-digit growth rate
would be more difficult to achieve
amid higher operating costs.
Lim said achieving a double-digit growth rate will be a challenge as
labour cost has escalated.
However, the group aims to offset higher labour cost in FY15 with
increased automation.
He said with the capital expenditure (capex) to increase automation
in its manufacturing process, especially in the nitrile glove packaging
segment, the group can cut labour
costs by half.
Top Glove has allocated RM150
million in capex for FY15. For the
first quarter ended Nov 30, 2014
(1QFY15), RM40 million was spent.
Lim told a media briefing yesterday that with automation and
improved efficiency, the group had
managed to reduce its head count
by 1,000.
Lim is of the view that FY15 will
Lim says achieving a
double-digit growth rate
will be a challenge as
labour cost has escalated.
Photo by Patrick Goh
be a better year, with a better profit
margin on the back of falling crude
oil prices and the weakening ringgit
against the US dollar.
This is despite Top Glove seeing
its net profit fall 3.2% to RM48.68
million for 1QFY15 from RM50.28
million a year ago, while its net
margin declined 0.2% year-on-year.
“FY15 will be a tailwind [for Top
Glove], but we still have to work
not only hard, but smart,” Lim said,
maintaining that the group’s gain
on falling crude oil prices is only
“temporary” as oil prices move
in cycles.
The Brent crude oil fell more
than 50% to US$51.50 (RM183.85)
yesterday from US$115 in June last
year.
The softening natural rubber
prices in the past few months are
also a boost to the rubber glove
margin, which stands close to 20%
now, as the average selling price
of rubber gloves has not dropped
as much as the raw material price.
KUALA LUMPUR: Express delivery
service firm GD Express Carrier
Bhd (GDex) has proposed to undertake a private placement of up
to 10% of its issued share capital to
raise up to RM227.12 million at an
illustrative issue price of RM1.58
per placement share.
In a filing with Bursa Malaysia yesterday, GDex said the proceeds from the private placement
will be used for working capital
(RM65 million), capital expenditure (capex) and business development (RM161.42 million) and estimated expenses in relation to the
proposed exercise (RM700,000).
“After due consideration of the
various methods of fundraising,
the board is of the view that the
proposed private placement is
the most appropriate avenue of
fundraising at this juncture, as it
enables the company to raise funds
expeditiously without incurring
interest cost compared to bank
borrowings,” said GDex.
Prior to the proposed private
placement, GDex had proposed to
undertake a 3-for-1 bonus issue, a
5-for-1 warrants issue as well as a
dividend reinvestment plan (DRP)
on its final dividend of 1.125 sen
per share.
“Assuming all the warrants-A
are exercised, the entire bonus
shares issued, all the warrants-B
exercised and the entire DRP is
undertaken, the proposed private
placement will entail the issuance
of up to 143.74 million placement
shares, representing 10% of the
enlarged issued share capital of
GDex.
The issue price of the placement
shares will be fixed by the board
at a later date after obtaining the
necessary approvals.
The issue price will not be
priced at more than 10% discount
to the five-day volume-weighted average market price of GDex
shares immediately before the
price-fixing date.
KUALA LUMPUR: Citi was awarded the Best Bank in Asia in 2014
by industry publication FinanceAsia, making it the sixth year in
a row that the bank has won the award.
The magazine’s editorial team chose Citi after assessing various banks on their institutional and retail banking performance
for the last 12 months.
Citi also picked up the Best M&A Bank award after leading
over US$85 billion (RM303.11 billion) of mergers and acquisitions (M&A) transactions in 2014, it said in a statement yesterday.
“The bank’s client work was also recognised via Deal of the
Year, Best Equity Deal, Best IPO, Best Equity-linked Deal, Best
M&A Deal, Best Project Financing, Best Loan and Best Private
Equity Deal,” it added.
The bank was also recognised for having led the transaction
that picked up the Best Country Deal award in South Korea.
“Asia is at the heart of Citi’s transformation and we are well
placed to capture more of the growth opportunities in this region,” said Citi Asia-Pacific chief executive officer Stephen Bird.
The magazine’s editors said Citi won the top award for its remarkable momentum in Asia.
“It also maintained a well-balanced split among businesses and
countries. Citi has managed to harness the growing importance
of Asia in a region that now accounts for a third of Citi’s global
net income and a fifth of its global revenues.”
Citi helped raise over US$150 billion for clients from international capital markets in 2014 and advised on over US$85 billion
in M&A.
The past year also saw the bank passing the seven million mark
for digital banking users in Asia, as well as US$250 billion in client
assets in the region for the first time in its history.
Gan joins ailing Perwaja
Powdered latex gloves accounted for 48% of Top Glove’s total glove
production in 1QFY15, while nitrile
gloves accounted for 24% of total
production.
Despite fiercer competition
among glovemakers in Malaysia,
Top Glove expects its share of the
global market to rise to 30% by 2020
from 25% currently, said Lim.
This will happen if the group has
more than 30% market share from
the existing 25% of natural rubber
gloves, as well as a bigger market
share for the nitrile glove segment
from the existing 18% to 25% in five
years, he added.
GDex to raise up to RM227m
from 10% private placement
BY L EVI N A L I M
BY Y IMIE YO N G
“The proposed private placement is not expected to have a
material effect on the earnings
of the GDex group for the financial year ending June 30, 2015 as
the proceeds to be raised are expected to be used within 12 to 24
months from the date of listing of
the placement shares.
“However, it is expected to
contribute positively to the future earnings of the group when
the benefits of the utilisation of
proceeds are realised,” it added.
After the proposed private
placement, its gearing ratio as at
June 30, 2014 will fall from 0.27
times to 0.09 times.
The proposed private placement
is subject to the approval of regulatory authorities, and applications
to the relevant authorities are expected to be submitted within one
month from yesterday.
GDex shares closed six sen or
2.93% higher to RM2.11 yesterday,
giving it a market capitalisation of
RM1.89 billion.
BY C H E S T E R TAY
KUALA LUMPUR: Former deputy youth and sports minister Gan
Ping Shou has joined the board of directors at Perwaja Holdings
Bhd as an independent and non-executive director.
In a filing with Bursa Malaysia yesterday, the loss-making steel
maker said the appointment of Gan, 48, is with immediate effect.
Perwaja also named Datuk Henry Pheng Chin Guan, son of Tan
Sri Pheng Yin Huah, as alternate director to his father. Chin Guan
is also the chief executive officer (CEO) of Kinsteel Bhd.
In a separate filing, Datuk Seri Mohd Fauzi Yon is now alternate
director to Datuk Ong Tee Thong, a non-independent non-executive director of Perwaja.
On Dec 31, 2014, Perwaja saw the resignations of Chin Guan as
CEO of Perwaja, Yin Huah as its managing director and Ong as its
chairman,following a reduction of Kinsteel’s interest in Perwaja
to 31.25%.
Perwaja shares inched up 10% to close at 5.5 sen yesterday, giving it a market capitalisation of RM30.8 million.
Meanwhile, Kinsteel’s share price was up 3.45% to close at 15
sen, bringing a market cap of RM157.4 million.
Former FGV boss Sabri Ahmad dies
KUALA LUMPUR: Former Felda
Global Ventures Holdings Bhd
(FGV) group president and chief
executive officer (CEO) Tan Sri
Sabri Ahmad (pic), 68, passed
away from lung cancer at 5.30am
yesterday.
Sabri was also former CEO of
Golden Hope Plantations Bhd
and former chairman of the Malaysian Palm Oil Board.
He first joined the civil service
in 1970 to serve in the agriculture
ministry, then moved on to the
private sector in 1985 to join Harrisons Malaysia Plantations Bhd.
He later joined Golden Hope
Group, Mentakab Rubber Co Malaya Bhd, Negara Properties (M)
Bhd, MSM Malaysia Holdings Bhd and Australian Agricultural Co Ltd.
When Sabri was at Golden Hope, the company had the distinction of having the country’s largest land bank, as well as the best
oil extraction rate.
Sabri led the privatisation of FGV and was instrumental in its
listing, which saw all the major plantation companies acquired
under Synergy Drive, and thereafter Sime Darby.
During Sabri’s tenure as president and CEO of FGV, the group
successfullylisted on the Main Market of Bursa Malaysia in 2012,
becoming the world’s second-largest initial public offering (IPO)
after Facebook. — Bernama
THE EDGE FILE PHOTO
BY C H EN SHAUA F UI
Citi is best bank in Asia for 6th time
1 2 I N V E ST I N G I D E A S
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
I N S I D E R A S I A’S S TO C K O F T H E D AY
OKA CORPORATION BHD
(ALL FIGURES IN RM MIL)
OKA Corporation Bhd
IPOH-based OKA Corporation is a major manufacturer of pre-cast concrete products in Malaysia. Founded in 1981, it has five factories located
in the peninsula, producing pipes, L-shaped
retaining wall units, U-shape drains and other
concrete products catering for the infrastructure,
sewerage, construction and highway industries.
OKA offers investors an attractively-priced
exposure to Malaysia’s ramp-up in infrastructure spending with its strong fundamentals, low
valuations and decent yields. At 78 sen, the stock
is trading at just about its book value of 77 sen
and a trailing 12-month P/E of just 7.5 times.
Having supplied to major projects including KLIA 2, MRT and LRT, as well as the Pasir
Panjang Terminal in Singapore, OKA should
continue to benefit from future infrastructure
projects such as the MRT 2 and LRT 3.
The company implemented a 1-to-2 stock
split in May and a 1-for-4 bonus issue in November, improving liquidity for the stock. Its
share price had been trending higher through
to the third quarter of 2014 before correcting under current weak market conditions.
OKA’s revenue has grown steadily, from
RM103 million in FY March 2010 to RM145.4
million in FY2014 while net profit expanded
from RM3.9 million to RM13.4 million over
the same period. Net margin widened to 9.2%
in FY2014, on the back of revenue growth and
prudent cost control.
The company’s financials improved further
in 1HFY2015. Revenue rose 13.7% to RM80.9
million while net profit grew an outsized 44.6%
to RM8.1 million. Strong earnings growth over
the past few years has pared OKA’s debts,
from gearing of 17.8% in FY2010 to net cash
of RM960,000 as at 30 Sept 2014.
The company has paid consistent dividends, between 3-3.5 sen per share over the
last 5 years. Dividends for FY2014 totalled 3
sen per share, translating into net yield of 3.8%.
Valuation factor *
2.40
Fundamental factor **
2.20
Trailing 12m P/E (x)
7.46
Trailing 12m PEG (x)
0.08
P/NAV (x)
1.00
Trailing 12M Dividend yield (%)
3.07
Market capitalisation (RM mil)
118.78
Shares outstanding (ex-treasury) mil 152.28
Beta
1.10
12-month price range
0.4 - 1.03
*Valuation factor — Composite measure of historical return & valuation
**Fundamental factor — Composite measure of balance sheet strength &
profitability
Note: A score of 3.0 is the best to have and 0.0 is the worst to have
T O N G ’S
MOMENTUM
P O RT F O L I O
ON Wednesday, stocks on the local bourse
rebounded after six days of consecutive losses, taking their cue from regional markets and
Wall Street which closed higher. The benchmark index surged 1.1% to close at 1,728.06.
Market breadth was positive, with gainers
outperforming losers by a 2-to-1 ratio. The brief
improvement of investor sentiment can be attributed to the halt in the ringgit’s slide, which
traded at just over 3.56 per US dollar after threatening to inch towards RM3.60 the previous day.
Investors were also relieved that crude oil
prices finally stopped plunging and chalked
up gains overnight. However, it is unclear if
crude oil prices have finally found a bottom,
or whether this is just a temporary reprieve
given oversold conditions for the commodity.
Global equities advanced taking their lead
from strong overnight gains on Wall Street,
which snapped five days of consecutive losses.
The catalysts for the rally there were data
showing strong private sector job creation and
minutes from the Federal Reserve meeting
which reassured investors that a potential rate
hike was nowhere near yet on the horizon.
Bucking the uptrend, China stocks fell on
profit taking activities after its benchmark
index, Shanghai Composite rallied to a five
year high the day before.
I continue to be cautious on the outlook
for Malaysian equities and have therefore
kept my portfolio unchanged with a high
cash holding level.
Currently, I am only holding Willowglen,
which was unchanged yesterday.
My portfolio is currently registering a gain
of 1.0% since inception, and has still outperformed the benchmark KLCI by 9.7%.
Income statement
Turnover
EBITDA
Depreciation and amortisation
EBIT
Associates
Interest income
Interest expense
Extraordinary gain/(loss)
Pre-tax profit/(loss)
Net profit/(loss) - owners of company
Balance sheet
Fixed assets - PPE
Biological assets
Intangibles & goodwill
Cash and equivalents
Total current assets
ST borrowings
Total current liabilities
Total assets
Shareholders’ fund
Long term borrowings
OKA CORPORATION BHD
RATIOS
DPS (RM)
Net asset per share (RM)
ROE (%)
ROA (%)
Turnover growth (%)
Net profit growth (%)
Net margin (%)
Current ratio (x)
Gearing (%)
Interest cover (x)
QUANTITY
BOUGHT PRICE
RM
9,000
0.789
FY12
31/3/2011
FY13
31/3/2013
FY14
31/3/2014
LATEST 2QFY15
30/9/2014
121.1
10.7
4.3
6.4
0.0
1.0
5.4
4.9
133.1
14.4
5.4
9.0
0.0
0.8
(0.0)
8.2
5.7
145.4
24.7
6.0
18.8
0.1
0.5
18.3
13.4
41.7
8.4
1.5
6.9
0.0
0.0
6.9
5.1
64.6
1.6
75.5
21.4
46.1
94.7
93.7
0.7
64.1
1.8
73.8
17.8
40.5
97.9
97.6
-
64.8
3.6
79.1
8.7
34.4
110.1
109.7
-
63.9
2.6
86.5
1.6
32.8
118.2
117.8
-
FY12
31/3/2011
FY13
31/3/2013
FY14
31/3/2014
ROLLING 12-MTH
0.03
1.56
5.61
5.58
8.78
(12.07)
4.08
1.63
21.84
11.18
0.04
1.63
5.93
5.89
9.89
14.84
4.26
1.82
16.34
18.01
0.03
1.80
12.91
12.86
9.27
135.80
9.20
2.30
4.60
46.02
0.03
0.77
15.12
15.07
16.38
92.42
10.26
2.63
104.55
BOUGHT VALUE CURRENT PRICE
RM
RM
CURRENT VALUE
RM
GAIN / LOSS
RM
% GAIN / LOSS
6,615.0
(489.3)
(6.9%)
Shares held:
Willowglen MSC Bhd
Total
7,104.3
0.735
--------------7,104.3
--------------- --------------6,615.0
(489.3)
--------------7,104.3
--------------- --------------6,615.0
(489.3)
Shares bought:
No shares were bought today.
Total shares held
(6.9%)
Shares sold:
No shares were sold today.
Cash balance
94,369.9
Realised profits / (losses)
1,474.3
Total Portfolio Returns
Annualised returns for portfolio
100,000.00
100,984.9
984.9
Portfolio Beta
Risk adjusted returns for portfolio
1.0%
1.9%
1.166
1.7%
Performance Comparison
FBM KLCI
FBM KLCI Emas
At portfolio start
1,892.7
13,163.7
Current
1,728.1
11,853.3
Change
(8.7%)
(10.0%)
Relative portfolio outperformance
9.7%
10.9%
This is a personal portfolio for information purposes only and does not constitute a recommendation or solicitation or expression of views to influence readers to buy/sell any stocks.
Portfolio started on 8 July 2014 with RM100,000.
B R O K E R S’ C A L L 13
F R I DAY JA N UA RY 9 , 2015 • T HEED G E FINA NCIA L DA ILY
‘Brahim’s to reduce
airline catering
dependence’
Brahim’s Holdings Bhd
(Jan 8, RM1.33)
Not rated, but with a target price
(TP) of RM1.33: Brahim’s share
price retreated 56% from a high of
RM2.70 to a low of RM1.19 after a
series of disappointing financial
results and amid the concern of
Malaysian Airline System Bhd
(MAS) restructuring exercise.
Financially, nine months of
financial year 2014 (9MFY14)
core profit after tax and minority interests (Patami) fell 27% to
RM10.6 million on the back of
lower revenue (3.9%) amounting
to RM274.5 million.
The 9MFY14 net profit contribution from the airline catering
segment (contributes 95% of revenue) slumped 37.2% to RM34.5
million, on the back of lower passenger volume following the recent air disasters as well as lower
average selling price per meal of
MAS flights due to the cost reduction initiatives.
Although MAS flights accounted for more than 70% of the total
airline meals sales of Brahim, we
do not expect a complete slump
even if MAS decides to cut down
its flights significantly as the demand-driven flights to certain
destinations will eventually be
taken over by the other airlines in
KLIA, where Brahim has a commanding market share of 99%.
However, margins are projected
to be narrowed as contracts with
other airlines offer lower margins
compared with MAS.
To recap, the group has proposed to acquire Burger King (BK)
Malaysia and Singapore franchise
holder, Rancak Selera Sdn Bhd for
a cash consideration of RM95 million through 80:20 joint venture
with Quantum Angel Sdn Bhd,
headed by Datuk Ahmad Zaki
Zahid, the former managing director of KFC Holdings (M) Bhd.
The group is aiming to turn
around the loss-making entities by
leveraging Ahmad Zaki’s expertise
as well as through various marketing and product strategies. We
conservatively expect the group
to take two to three years to turn
around the business.
In another corporate exercise,
Brahim has entered into a business joint venture (49:51) with
Carpenter Beef Pty Ltd for the
development of a halal-compliant
abattoir in Perth, Australia, which
will incur a capital expenditure
(capex) of RM21.3 million based
on Brahim’s stake.
The move will provide the
group better control and cost ef-
ficiencies of raw material (beef )
for both its airlines catering needs
as well as for the BK should the
deal materialises.
We understand that the group
is aiming to reduce the dependency on the dominant airline catering business (95% revenue)
to a more balanced mix of 50:50
with food and beverage (F&B)
business. Thus, we foresee the
group will seek further acquisition opportunities in the F&B
space moving forward.
Gearing is expected to increase
to 0.76 times from 0.47 times post
BK and abattoir JV, but management still sees room to gear up at
below the one time level.
We do not rate Brahim’s, but
we believe that it has a fair value of RM1.30, based on 19 times
price-earnings ratio (PER) FY15
earnings per share of 6.83 sen, in
line with its three-year mean PER.
We laud the group’s effort in
focusing more on F&B business
in order to reduce its exposure
to the airline catering business.
However, we think that the contribution from BK will only arrive
in the longer term, considering
the loss-making status it is in now.
Meanwhile, higher finance
costs will be incurred to fund the
acquisitions as well as the capex.
We have yet to factor in the financial impact from the acquisitions
before the deals are completed.
At this juncture, the stock is
fairly valued judging by the 7%
earnings growth we project in
FY15. — Kenanga Research, Jan
8, 2015.
Caring increasing
retail presence with
10 new outlets
Caring Pharmacy Group Bhd
(Jan 8, RM1.19)
Upgrade to neutral from sell with a
target price of RM1.27: We view Caring Pharmacy Group’s commitment to
10 new outlets in 2015 and increasing
retail presence vis-à-vis its peers as
positive for the long run. We upgrade
our call to “neutral” from “sell” with
an unchanged RM1.27 target price or
6.7% upside pegged to 16 times 2015
price-earnings ratio (PER). However,
we reiterate our cautious stance on
the near-term outlook for this stock
due to intense competition and cost
pressures.
Management recently said it is
committed to opening about 10 new
outlets in 2015. These outlets are to be
located in around the Klang Valley, in
line with its new expansion strategy.
Caring currently has a strong foothold
in urban middle class areas. The group
plans to operate a total of 115 to 120
outlets by 2016.
Our recent observation on Caring’s
major competitors — Cosway Sdn
Bhd and Guardian Health & Beauty
Sdn Bhd — has shown a reduction in
outlet numbers in major states such
as Kuala Lumpur and Selangor. We
believe this is due to the competition
from independent pharmacies and
the high costs incurred in maintaining
pharmacists at these outlets. Caring
has now surpassed Guardian with 102
outlets compared with 99 respectively. Meanwhile, Cosway remains in the
lead with 138 outlets.
We expect Caring to experience
minimal impact from the implementation of the goods and services tax
(GST). This is due to healthcare demand being inelastic. Hence, we expect the group’s sales to remain steady
post GST. We remain cautious on increasing price competition, underperformance of new outlets, rising pperating costs — personnel and marketing,
and scarcity of good new locations. We
make no changes to our forecasts at
this juncture. We believe the recent
selldown of its shares has priced in the
two consecutive quarterly earnings
disappointments and the weakness
in the financial market. We view the
group’s increasing presence in the retail
pharmacy market via its peers as positive in the long run. — RHB Research
Institute Sdn Bhd, Jan 8.
si-Ulu Kelang Elevated Expressway
(RM4 billion) and Damansara-Shah
Alam Highway (RM4 billion).
Concern is rife that low oil prices
would lower government revenue
which may lead to a cut in development expenditure to ensure the
fiscal deficit target of 3% is met.
We believe that lower oil revenue
will be offset by savings from the removal of fuel subsidies. The strong
development expenditure increase
for 2015 has also been paired with
flattish operating expenditure. Our
economics team estimates that
development expenditure growth
will come in flat should the crude
oil price average of US$63 (RM225)
per barrel for 2015.
Even if development expenditure is cut, this should not adversely impact the roll-out of mega
projects as they are mostly implemented “off balance sheet” by the
government.
We retain our “overweight” rating on construction premised on
three catalysts: (i) ramp up in development expenditure; (ii) continued roll-out of mega projects; and
(iii) unveiling of the 11MP. — HLIB
Research, Jan 8, 2015.
Expect some excitement for construction
Construction sector
Maintain overweight: Development expenditure is targeted to
increase strongly by 15% year-onyear (y-o-y) in 2015 to RM48.5 billion. This is significant considering
that y-o-y changes for 2011 to 2014
only ranged between 1% to -12%.
Given its high correlation (81%) to
development expenditure, growth
in nominal construction output is
expected to be strong.
Real construction growth has
outperformed overall gross domestic product (GDP) since the first
quarter of 2012. Our economics
team projects this to continue in
2015 with construction growth at
10% on back of GDP of 4.8%. Domestic contract awards to listed
contractors were robust with 2014
amount at RM17.9 billion, displaying a 16% y-o-y growth.
The 11th Malaysia Plan (11MP)
[2016 to 2020] will be unveiled in
May 2015. This will be the most
critical Malaysia Plan as it ends in
2020, the target timeline to achieve
a “high income nation” status. Similar to past plans, we expect some
excitement for construction.
The key mega projects that we
expect to be rolled out over the next
one to two years include the mass
rapid transit Line 2 (RM23 billion),
light rail transit Line 3 (RM9 billion), and Warisan Merdeka (RM3
billion). There are also a variety of
highways such as the open tender
portion of the West Coast Expressway (RM2.2 billion), the Sungai Be-
14 B R O K E R S’ C A L L
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
Strong demand sees
increase in Ta Ann’s
log exports
Parkson closure
in Hanoi seen as
a positive move
Parkson Holdings Bhd
(Jan 8, RM2.50)
Maintain buy with a target price
of RM3.40: We reaffirm our “buy”
recommendation on Parkson Holdings Bhd with an unchanged fair
value of RM3.40 per share, pegged to
an unchanged price-earnings ratio
(PER) of 22 times financial year 2015
(FY15) earnings — one standard deviation above its five-year historical
mean PER.
Parkson has temporary closed its
store at the 72-storey Hanoi Landmark Tower in Vietnam. We are
not surprised by the closure of this
loss-making store given Parkson’s
proactive store management.
This is seen as a positive move,
in our view, given that this store has
been loss-making since its opening
three years ago, largely due to high
rental costs and low footfall traffic.
We understand that the temporary closure is pending the renegotiation of some long-standing
matters with the landlord.
As mentioned previously, we
believe that the swing factor for an
improvement in Vietnam’s operation largely hinges on the closure of
this store, in addition to its strategy
to improve the merchandising mix.
The continued operating losses
at the Hanoi Landmark Tower store
has dragged losses further — operating losses for Vietnam and Myanmar doubled to RM3.1 million in
the first quarter of FY15 (1QFY15)
while Vietnam’s same-store sales
growth (SSSG) contracted by 5.5%
in 1QFY15.
Parkson continues to expand
and is earmarked to open a store in
Danang, Vietnam, on Jan 11. Currently, it has a total of nine stores
Parkson Holdings Bhd
FYE JUNE 30 (RM MIL)
2013
Revenue
Core net profit
FD Core EPS (sen)
FD Core EPS growth (%)
Consensus net profit
DPS (sen)
PER (x)
EV/Ebitda (x)
Dividend yield (%)
ROE (%)
Net gearing (%)
2014
2015F
2016F
2017F
3,501.7 3,550.9 3,600.2 3,754.1 3,971.6
239.7
138.3
168.0
195.7
238.8
22.1
13.0
15.4
18.0
21.9
(36.5)
(41.2)
18.5
16.5
22.0
172.4
191.6
217.7
18.0
0.0
6.2
7.2
8.8
11.3
19.2
16.2
13.9
11.4
5.0
5.7
5.2
5.3
5.2
7.2
0.0
2.5
2.9
3.5
8.8
5.1
5.7
5.9
7.0
Net cash Net cash Net cash Net cash Net cash
Source: Company, AmResearch estimates
KENNY YAP
Ta Ann Holdings Bhd
(Jan 8, RM3.65)
Maintain buy with a target price
(TP) of RM4.55: A rise in mature
plantation areas has increased Ta
Ann Holdings’ fresh fruit bunch
(FFB) production, while a strong
demand for logs and improved log
production have increased exports.
Maintain “buy” rating with an unchanged sum-of-parts-derived TP
of RM4.55, based on 2015 to 2016
earnings per share growth of 10%
to 13% and a solid 5.3% 2015 dividend yield.
Ta Ann recently announced that
total log production in the 11 months
of 2014 (11M14) rose by 26.7% yearon-year (y-o-y) to 467,786 cu m.
Strong demand for tropical logs,
especially after Myanmar’s ban on
log exports from April 2014, has increased Ta Ann’s total log exports
and kept its average selling price
(ASP) high at US$250 (RM891) to
US$260 per cu m.
The Tasmanian mill is scheduled
for a trial run next month. This should
enable Ta Ann to manufacture and
sell plywood directly to the Australian market. Demand for plywood was
3.9% y-o-y higher in the 9M14, and
this helped to push up the blended
ASP for Ta Ann’s plywood products
to between US$524 and US$546 per
cu m. We expect plywood demand to
remain stable in 2015, underpinned
by Japan’s construction needs and
sustained demand for plywood products given specialist applications and
sales to the Australian market.
Our 2015 to 2016 forecasts conservatively factor in a ASP of US$525
per cu m.We expect the earnings contribution from Ta Ann’s plantation
division to continue to grow, driven
by the rising maturity of its plantation
estates and increasing FFB and crude
palm oil (CPO) production, as well
as yield. Thus, we expect plantation
earnings to grow by 10% to RM75
million in 2015.
We reaffirm our “buy” call on Ta
Ann shares due to above-market
earnings per share growth of 10%
to 13% in 2015 to 2016 on higher
log exports, improving plantation
earnings given rising mature areas,
and higher FFB and CPO production
and what we view as an attractive
2015 dividend yield of 5.3%. — Affin
Hwang Investment Bank Bhd, Jan 8.
Ta Ann Holdings Bhd
FYE DEC 31 (RM MIL)
in Vietnam including the one in the
Hanoi Landmark Tower.
All said, we remain committed
to the investment thesis of expected improved profitability from a
low base, underpinned by improving SSSG and margin uplift from a
proactive store rationalisation and
merchandising mix.
The key valuation driver lies in
the improvement in SSSG for China
and monetisation of loss-making
retail assets.
On a positive note, Parkson continues to engage in active share buybacks, providing downside risk to
its share price. Valuation wise, the
stock is trading at a forward PER
of 16 times. Stripping out its net
cash, PER stands at an attractive
nine times. — AmResearch Sdn
Bhd, Jan 8.
Revenue
Ebitda
Pretax profit
Net profit
EPS (sen)
PER (x)
Core net profit
Core EPS (sen)
Core EPS growth (%)
Core PER (x)
Net DPS (sen)
Dividend yield (%)
EV/Ebitda (x)
Change in EPS (%)
Affin/Consensus (x)
2012
2013
2014E
2015E
2016E
789.9
166.3
77.8
57.5
15.5
24.3
80.4
21.7
(58.2)
17.4
5.0
1.3
10.5
-
774.2
171.3
114.7
92.1
24.8
15.2
68.6
18.5
(14.6)
20.4
5.0
1.3
9.7
-
950.1
234.1
168.9
125.8
34.0
11.1
109.4
29.5
59.4
12.8
25.0
6.6
6.8
1.0
1,056.5
252.4
165.9
123.6
33.4
11.3
123.6
33.4
13.0
11.3
20.0
5.3
6.2
1.1
1,106.4
266.0
182.3
135.8
36.7
10.3
135.8
36.7
9.9
10.3
22.0
5.8
5.6
1.0
Source: Company, Affin Hwang estimates
Genting Malaysia should finally see strong rerating this year
Genting Malaysia Bhd
FYE DEC (RM MIL)
Revenue
Operating Ebitda
Net profit
Core EPS (RM)
Core EPS growth (%)
FD Core PER (x)
DPS (RM)
Dividend yield (%)
EV/Ebitda (x)
P/FCFE (x)
Net gearing (%)
P/BV (x)
ROE (%)
Change in core
EPS estimates (%)
CIMB/consensus EPS (x)
Source: CIMB, company reports
2012A
2013A
2014F
2015F
2016F
7,893
2,478
1,402
0.26
1.7
15.21
0.090
2.28
8.46
23.57
(16.1)
1.77
12.2
8,328
2,409
1,603
0.28
9.8
13.85
0.095
2.41
8.81
18.06
(11.1)
1.51
11.8
8,449
2,445
1,475
0.25
(12.6)
15.86
0.095
2.41
8.91
59.29
(9.9)
1.42
9.2
8,461
2,373
1,398
0.24
(5.2)
16.73
0.097
2.46
9.14
40.75
(9.9)
1.34
8.2
10,305
3,022
1,876
0.32
34.1
12.47
0.100
2.54
6.60
10.35
(18.4)
1.24
10.3
-
-
0.00
1.09
(6.87)
0.92
(8.99)
1.08
Genting Malaysia Bhd
(Jan 8, RM3.94)
Maintain add with a lower target
price (TP) of RM5.38 from RM5.51:
Genting Malaysia provided guidance
on the negative impact of the goods
and services tax (GST) on financial
year 2015’s (FY15) earnings, which
it will absorb. This proved higher
than our estimate and we reflect
this accordingly in our FY15 to FY16
forecasts. Also, a sizeable provision
for costs associated with the failed
New York casino bid will be made in
the fourth quarter of FY14 (4QFY14).
On a positive side, its land in Miami
has appreciated strongly and approval has been given for the new
gaming capacity.
Our revalued net asset value-based TP falls slightly to RM5.38
on lower FY16 earnings before interest, taxes, depreciation and amortisa-
tion (Ebitda), mitigated by revaluation
surplus for Miami. Maintain “add”,
with gaming capacity addition in late2015 as a potential rerating catalyst.
Genting Malaysia participated in
our Malaysia Corporate Day conference on Tuesday and met with 10
fund managers.Questions surrounded
the outlook for 2015 and updates on
the timeline for the various Genting
Integrated Tourism Plan milestones.
For the first time, Genting Malaysia
provided preliminary guidance on
the negative impact of the GST on its
Ebitda. It estimates that FY15 Ebitda
will be negatively affected by RM200
million to RM300 million which is
equivalent to three to four percentage
points of its Malaysian gaming Ebitda
margin, which it will try to mitigate
by cutting commissions to junkets.
To offset domestic day trippers
potentially cutting back on gaming
spending, the management will be
aggressively targeting Johor, Singapore and China tourists or gamblers
in 2015 given the weak ringgit.The
4QFY14 results will also see a “sizeable” provision for costs associated
with the failed New York bid, although
no specific guidance was given.
A big positive was that the additional gaming capacity has been
approved by the government.There
could be downward pressure on Genting Malaysia’s share price leading
to 4QFY14 results in late February
given consensus earnings downgrades to reflect the GST impact as
well as uncertainty about the size
of the one-off provision in 4QFY14.
With the additional gaming capacity
approved and on track to open by
year-end, Genting Malaysia should
finally see a strong rerating this year.
— CIMB Investment Bank, Jan 8.
16 H O M E
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
Universiti Malaya bans
political activities
It is prohibiting students and staff from organising such events
KUALA LUMPUR: Amid growing
student activism, Universiti Malaya (UM) has reportedly issued a
circular prohibiting its staff from
organising political activities.
In the circular dated Dec 23, 2014,
the country’s oldest varsity said that
it had noticed the active involvement
of its students and staff in political
activities of late.
“The university views seriously
any behaviour, attitude and actions
that are not mindful about, or does
not preserve and defend the sover-
eignty and dignity of the country, as
well as respect and obey [its] laws,”
the circular said.
“It is an obligation for Universiti
Malaya staff to give their loyalty to
the Yang di-Pertuan Agong, country,
government and Universiti Malaya
at all times,” it said.
The circular, which was issued
by the university’s registrar, Yusoff
Musa, said to protect the interests
of the university, it will prevent its
staff, including those on study leave,
or attending seminars and courses
in the country or overseas, from organising political activities.
This comes after the university
hauled up eight of its student leaders, dubbed the UM8, for organising a banned programme that saw
opposition leader Datuk Seri Anwar Ibrahim entering the campus
last October.
Two of the students, former UM
Undergraduates Association president Fahmi Zainol and UM Pro-Mahasiswa president Safwan Shamsuddin, were suspended while the rest
were fined RM150 each, while one
was let off with a warning.
Associate Professor Dr Azmi Sharom, who is also UM’s Academic Staff Association president, had
backed the Anwar programme,
which the university earlier banned.
Azmi also criticised the university
for its “antagonistic stance” against
its students, saying the ban on Anwar’s talk was inconsistent with its
goal to be an internationally recognised institution of higher learning.
— The Malaysian Insider
Revise fuel purchasing system, govt told
KUALA LUMPUR: The government
must revise its fuel purchasing system for petrol station operators to
save them from losses due to price
fluctuations, an opposition lawmaker said.
PKR secretary-general Rafizi
Ramli said that rather than having
to buy fuel wholesale, it would be
more equitable for the stations if a
consignment system was adopted,
as seen in countries such as Australia and South Africa.
Then station operators will not
have to pay up front to giant oil
companies for fuel.
Currently as “agents”, they are
only paid a commission by the oil
companies based on the volume
of sales.
Under the current wholesale system, oil companies such as Petronas, Shell, Petron and BHP require
that petrol stations buy stock in cash
that is at least three days’ worth of
their sales at any given time.
This exposes the station operators to losses when oil prices go
down, as they buy their stocks of
petrol and diesel at a higher price.
“[In] the consignment system,
the financial risks faced by operators
are removed. The petrol prices can
also be revised frequently without
It has been alleged that Putrajaya made RM633
million in one month from the difference
between world oil prices and the prices
Malaysians pay for petrol and diesel.
Rafizi said by implementing the
consignment system, the excuse
that fuel prices cannot be revised
on a weekly basis no longer
exists. The Edge file photo
any financial impact on key stakeholders,” Rafizi said in a statement.
Rafizi warned that petrol station
operators are at risk of closing down
under the automatic price mechanism Putrajaya uses to fix the retail
price of petrol and diesel, saying
that at current pump prices retail-
ers would have racked up losses of
up to RM15,000.
They will have to bear these losses for the rest of the month, and run
the risk of debt snowballing, owing
to the higher price they paid to petrol companies.
Rafizi said by implementing the
consignment system, the excuse
that fuel prices cannot be revised
on a weekly basis no longer exists.
Putrajaya resisted calls for weekly
revisions of petrol and fuel pump
prices despite the continued plunge
in global oil prices (which have
reached below US$50 (RM178.50)
a barrel this week, and is expected
to be at US$40 a barrel by the end
of the month).
It removed fuel subsidies early
this month due to the tumbling of
global oil prices and set up a managed float pricing system where
prices would be set on a monthly average price. The price would
G25 given assurance of meeting with Najib
BY MD I ZWA N
KUALA LUMPUR: The group of 25
prominent Malays (G25) was given
an assurance on Wednesday night
that they will be granted a meeting
with Prime Minister Datuk Seri
Najib Razak.
G25 spokesman Datuk Noor
Farida Ariffin (pic) told The Malaysian Insider that a meeting with
the Prime Minister’s Office (PMO)
representative on Wednesday night
had been positive.
“We are all very happy. This is a
good meeting before the appoint-
ment with the prime minister,” she
said.
The meeting on Wednesday
night included PMO representative Datuk Jailani Ngah, who is
also Najib’s political secretary, and
representatives from the Malaysian
Islamic Development Department
(Jakim) and syariah lawyers.
Noor Farida, however, said no
date has been set for the meeting
with Najib.
(Wednesday evening’s) meeting
was merely to discuss the agenda
of the meeting with the prime minister, she said.
The meeting comes a month after G25 issued an open letter urging Najib to end extremist rhetoric
and resolve disputes arising from
the application of Islamic law in
the country.
“The meeting is being held on
the instructions of the prime minister for the relevant government
agencies to meet with the G25 and
to come up with suitable recommendations for his consideration
regarding the issues that the G25
had raised in the open letter,” Noor
Farida had said. — The Malaysian
Insider
be announced at the end of each
month for the following month.
Rafizi said that with weekly revisions, RON95 petrol might reach
RM1.40 a litre by the end of January, as opposed to RM1.91 a litre
that consumers are forking out this
month.
“Weekly price reviews of petrol
and diesel prices will see it fluctuate
according to market prices, and Barisan Nasional can no longer collect
billions of ringgit in hidden taxes as
what is happening now,” he said.
Rafizi previously alleged that Putrajaya made RM633 million in one
month from the difference between
world oil prices and the prices Malaysians pay for petrol and diesel.
He said if the federal government refused to revise the system, it meant it wanted to maintain above-market prices to collect
taxes from the commodity. — The
Malaysian Insider
Blogger jailed
three months for
contempt over
articles against
Rais Yatim
PUTRAJAYA: Blogger Amizudin
Ahmat was sent to prison yesterday to serve a three-month
jail term for contempt of court
over articles against former
information, communication
and culture minister Tan Sri
Dr Rais Yatim (pic).
He had failed to obtain leave
from the Federal Court here to
appeal against the High Court
decision which found him to
be in contempt for further publishing defamatory articles on
Rais and had sentenced him to
three months’ jail.
A five-member panel
chaired by Federal Court judge
Tan Sri Ahmad Maarop issued
the committal warrant against
Amizudin, 44, after rejecting
his application for leave to
appeal.
He said Amizudin could not
get the leave as the legal questions he posed did not meet the
threshold requirement under
Section 96 of the Courts of Judicature Act 1964.
Applicant in civil cases must
first obtain permission from
the Federal Court in order to
bring their appeal to the Federal Court, which is the apex
court.
On Nov 21, 2011, Rais, 72,
was granted leave to commence committal proceedings
against Amizudin in relation to
a civil suit filed by him.
Rais won his defamation
suit in the High Court which
on July 19, 2011, ordered Amizudin to pay RM300,000 in
damages and RM100,000 in
costs to the then minister.
He filed the suit on Jan 31,
2011, against Amizudin for defamation over an article posted
on the latter’s blogsite, sharpshooterblogger.blogspot.com,
on or about Dec 28, 2010.
The Court of Appeal had later upheld the High Court’s decision to award Rais RM300,000
in damages but reduced the
costs from RM100,000 to
RM50,000.
Amizudin also lost his appeal at the Court of Appeal
to set aside the three-month
jail term. His appeal was dismissed on July 23, 2013. He
subsequently filed leave to
appeal to the Federal Court.
— Bernama
H O M E 17
F R I DAY JA N UA RY 9 , 2015 • T HEED G E FINA NCIA L DA ILY
Search for black boxes in Java Sea
Now that the tail of Flight QZ8501 is confirmed, we are confident, says investigator
JAKARTA: Scores of divers plunged
into the Java Sea yesterday to search
for the wreckage of an AirAsia jet for
the black box recorders that could
reveal why the plane crashed, Indonesia’s search and rescue agency said.
Flight QZ8501 vanished from
radar screens over the northern
Java Sea on Dec 28, less than halfway into a two-hour flight from
Indonesia’s second-biggest city of
Surabaya to Singapore. There were
no survivors among the 162 people
on board.
The cause of the crash remains
a mystery, with hopes centring on
the so-called black boxes — the
flight data recorder and the cockpit voice recorder — providing vital
clues. The plane which crashed was
an Airbus A320-200, which carries
the recorders near the tail section.
The tail of the plane was found
on Wednesday, upturned on the sea
bed about 30km from the plane’s
last known location at a depth of
around 28m to 32m.
“After we found the tail, our
plan is to do everything step by
step,” Fransiskus Bambang Soelistyo, head of the search and rescue agency, told a news conference
in Jakarta.
“First we will [check whether]
the black box is still at its place, in
the tail, or if it has detached.”
A total of 84 divers are in ships
in the vicinity and teams began
searching the jet’s tail at 6.45am
with visibility poor and strong currents still impeding efforts, Fransiskus said.
Should diving teams confirm
the location of the recorders, the
tail will probably be plucked out
of the sea using a crane capable
of lifting 70 tonnes.
Ships with acoustic “pinger locators” designed to pick up signals from
the black boxes were at the location
but were no longer being used, in a
possible sign of confidence among
Indonesian officials that the recorders will be found soon.
Two Japanese ships that were
part of the international effort to
find the plane would now leave
the mission today, Fransiskus said.
“Now that the tail is confirmed,
we are confident,” Mardjono Siswosuwarno, the main investigator of
the National Transportation Safety
Committee, said on Wednesday.
“In my opinion, the pinger locators are no longer necessary to
finding the black box.”
Forty bodies and debris from the
plane have been plucked from the
surface of the waters off Borneo, but
strong winds and high waves have
been hampering divers’ efforts to
reach larger pieces of suspected
wreckage detected by sonar on the
sea floor. — Reuters
Peaceful assembly subject to
national security, court told
BY V A N B A L AGA N
KUALA LUMPUR: The right to assemble peacefully is not an absolute right but subject to conditions,
a government lawyer told the High
Court in a suit brought by Putrajaya
against Bersih over its rally in 2012.
Senior federal counsel Kamal
Azira Hassan said the protection of
the rights of other persons is a crucial
part in exercising the right to gather.
“It is for this reason, the right [to assemble peacefully] is not an absolute
right but made subject to restrictions
in the interest of the federation or
public order,” he said in his submissions before judge Datuk John Louis
O’ Hara.
In May 2012, Putrajaya took the
unprecedented step of suing former
Bersih co-chairman Datuk Ambiga
Sreenivasan and Bersih steering committee members, as rally organisers,
for damages of RM122,000.
The government filed its suit
against Ambiga under Section 6(2)
(g) of the Peaceful Assembly Act (PAA)
2012 which states that organisers
must “ensure that the assembly will
not endanger health or cause damage to property or the environment”.
“The plaintiff [government] charges that the defendants failed to carry
out their statutory responsibility when
the assembly went out of control and
turned into a riot, causing damage
to vehicles owned by the plaintiff,”
the writ said.
The government’s statement of
claims lists 15 vehicles, mostly belonging to the police, and repair costs
amounting to RM122,000. But in June,
2012, Ambiga filed a counter suit
against Putrajaya, alleging that the
government had breached her constitutional rights. Among other things,
the former Bar Council president
charged that the PAA was against
the Federal Constitution, particularly
Section 6 which she said had restricted her right to freedom of assembly.
In court yesterday, Kamal Azira
said the government was also a class
of persons to be accorded protection
from damage to their property.
“Parliament passed the PAA by
striking a balance between the interest of the plaintiff [government] and
the defendants to maintain public
order. The government, including local authorities, which has the right to
acquire and manage property , must
also be given the right to peaceful enjoyment of their possessions.”
Kamal Azira said Section 6 of the
PAA did not run foul of key articles in
the Federal Constitution. While Article 10 guaranteed the right to hold
peaceful assembly, he said, the rally
organisers had a duty to ensure that
gatherings were orderly and without chaos. Kamal Azira added that
any restriction imposed on Article 10
could not be questioned as provided
under Article 4 (2) of the constitution.
“Article 4 states that the validity of
any law shall not be questioned on
grounds that it imposes restriction
as mentioned in clause (2) of Article
10.”— The Malaysian Insider
Malaysia strongly condemns Charlie Hebdo attack
KUALA LUMPUR: The government
strongly condemned the attack on
the French satirical magazine, Charlie
Hebdo on Wednesday, the Foreign
Ministry said in a statement.
“Nothing justifies taking innocent
lives. Malaysia is united with the families of the victims, the government
of France, and the French people.
“As the prime minister has said,
we must fight extremism with moderation, cross cultural understanding and respect,” said the statement
yesterday, Bernama reported.
Datuk Seri Najib Razak said in
his official blog www.najibrazak.
com that Malaysia condemned
in the strongest terms all acts of
violence.
“We stand in unity with the
French people. We must fight extremism with moderation,” he said.
Three masked gunmen opened
fire at the Charlie Hebdo office on
Wednesday in Paris and killed 12
people and left three others critically wounded.
Also yesterday, Malaysia earned
praise for its moderate approach,
which helped it to secure the non-permanent member seat in the United
Nations Security Council (UNSC).
Several envoys noted that Malaysia’s
approach, themed “Peace and Security through Moderation” helped the
country to secure the seat, and is a
relevant concept for the international
community to combat extremism.
Malaysia, which won the seat in
October last year, assumes the post
from Jan 1, this year until 2016.
French Ambassador to Malaysia, Christophe Penot told Bernama said the approach, which he
described as a “meaningful one”,
could help the world tackle issues
and resolve conflicts.
He said Malaysia is already con-
tributing to France’s collective efforts
by participating in the UN peacekeeping operation and by facilitating the
Mindanao Peace Process between
the Philippines and the Moro Islamic
Liberation Front.
Apart from France, the other
UNSC permanent members are
China, the United Kingdom, Russia
and the United States.
China’s envoy to Malaysia Dr
Huang Huikang said China greatly
appreciates Malaysia’s responsible
attitude and relentless efforts to
push for peace and moderation
in the world.
US Ambassador to Malaysia, Joseph Y Yun told Bernama: “Our two
countries share a history of collaboration on global issues and we look
forward to working together in this
arena to uphold these responsibilities
and tackle the many global challenges
we face”. — Bernama
Students sitting for the UPSR. Putrajaya and the Malaysian Examinations Syndicate
have applied to strike out a suit brought by a 13-year-old boy following leaks in last
year’s test papers. Photo by The Malaysian Insider file pic
Govt moves to stop teen’s UPSR suit
on grounds it lacks merit
BY V A N B A L AG A N
KUALA LUMPUR: The government and the Malaysian Examinations
Syndicate have applied to strike out a suit brought by a 13-year-old boy
following the leaks in last year’s Primary School Achievement Test, or
Ujian Pencapaian Sekolah Rendah (UPSR). A notice filed by the Attorney-General’s Chambers, which is appearing for the government, stated
that Ananda Krishnan Menon’s suit lacked reasonable cause for action.
A trial will not be heard if the government succeeds in its application. Ananda, who has dyslexia, filed the suit last October against the
Malaysian Examinations Syndicate and Putrajaya for negligence in
the handling of the UPSR examination papers which was leaked the
previous month, resulting in some 480,000 Year Six pupils having to
retake four of the papers. The government’s application further stated
that the suit was frivolous, vexatious, and an abuse of court process.
“The plaintiff has a hopeless case and obviously not sustainable
against the defendants,” stated court papers made available to the media.
The government is also asking for legal costs to be paid by Ananda
and other relief deemed fit by the court.Ananda said in his suit that he
had suffered from emotional and mental stress as a result of the examination fiasco. The suit was filed through his mother K Managala
Bhavani through law firm Rajadevan & Associates last Oct 13.
Ananda, from Sekolah Kebangsaan Taman Tun Dr Ismail (2) in Kuala
Lumpur, said he lacked the will to repeat the entire process of preparation for the resits of the public examination. In his statement of claim,
Ananda said he was more depressed than the other pupils over the resit
because of his disability. Ananda claimed the government did not take
action against the examinations syndicate members and their agents
over the leaks. “Instead, the government set up an independent committee to review its standard operating procedure in the conduct and
management of public examinations,” the schoolboy said in the suit.
He said the syndicate, its employees or their agents were negligent
which resulted in the leak of the Science, English, Mathematics and
Tamil papers. He added that the syndicate had failed to provide a safe
system in ensuring there was no leak and failed to supervise its employees from the time the examination papers were sent to all schools
nationwide.
He is seeking aggravated damages for the situation allegedly created
by the syndicate. The examinations syndicate is entrusted to prepare
and print question papers for all public examinations as these documents are classified under the Official Secrets Act before the examinations start. — The Malaysian Insider
18 H O M E
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
The new homeless of Kuala Krai
Villagers setting up tents and bracing themselves for a future without any basic amenities
BY A NI SA H SHU KRY
KUALA KRAI: Besides his mother, all
Mohd Zafian Abdullah could save
was his grey cat, Labu. Everything
else he owned, including his house,
was destroyed in the worst floods to
have hit Malaysia in decades.
The three of them now live in a
makeshift tent, constructed from
scrap metal and plastic sheeting.
Nearby, an elderly widow,
Hasnah Mohamad, walks around
her ruined village, talking to neighbours to pass the time. She has no
house left to clean or belongings to
salvage from the rubble, and being
idle only makes her depressed.
As Putrajaya calculates the cost
of the damage from the recent
floods, the now homeless villagers of Kampung Dusun Nyior in
Kuala Krai, Kelantan, are setting
up tents in their flattened village
and bracing themselves for a future without any basic amenities.
The tiny village, tucked away in an
oil palm estate and so remote that it
cannot be found on maps, was almost
completely destroyed after Sungai
Kelantan burst its banks and pounded
their homes a fortnight ago.
Where wooden houses used to
stand, flimsy tents made out of donated tarpaulins, straw mats and planks
have been erected to shelter the villagers who have nowhere else to go
and no money to rebuild their homes.
Zalfian, 26, nudges the amber-eyed cat (which also goes by
the name Puma) purring beside
him. “I brought her with me to the
relief centre. I couldn’t have just
left the poor thing here when the
flood hit,” he said.
Home now is a small, raised
metal platform built from a metal
frame he scavenged from the nearby cemetery, while the plastic tarp
over his head was donated.
His former home, he said, is buried somewhere under a mound of
debris.
“All I do now is eat and sleep, and
clear out the foundation. I don’t
even know when I can start work
02
01
01. Kampung Dusun Nyior
in Kuala Krai was almost
flattened in the recent floods.
Many of its inhabitants are
now homeless.
02. The floods muddied
everyone’s possessions in
Kampung Dusun Nyior.
03. The aftermath of one of the
worst flooding episodes in
Kampung Dusun Nyior.
Photos by Afif Abd Halim/
The Malaysian Insider
because the stall that I used to work
at was destroyed by the flood. Definitely not next month,” he told The
Malaysian Insider.
“I’m all out of capital. So I’m just
going to stay here in this ‘tent’ until
and unless the government helps,”
said Zalfian, who makes and sells
roti canai for a living.
Food so far has not been a problem for the 50 or so villagers of Kampung Dusun Nyior. Donations have
come pouring in from non-governmental organisations and individuals
since the flood subsided last week.
But Hasnah, 60, cannot imagine
what will become of her and her two
children when the food supplies
stop and she is left to fend for her
family alone.
Their home was swept away
by the flood’s merciless pull, so
now she and her children — one
of whom is blind and intellectually
disabled — live in one of the many
tents dotting the ravaged village.
“I watched the flood swallow up
my house with my own eyes that
night. The water was like a huge
wave. Furniture rose up, spinning
in the rushing water. The water
level was so high you could pluck
the coconuts right from the boat.
“Now the water is gone, but I
don’t know what we will do. It is
all up to God. I just want the best
for us. I just don’t want to have to
go through that any more,” said
Hasnah, in tears.
As she wiped the tears with a
headscarf, Hasnah said she has no
source of income apart from what
her three other sons — who live in
other states — send to her, adding
that she is praying for the government to help her rebuild her house.
“I have little money, very little
money. Even before the flood hit, I
only had enough to feed the three of
us. I’ve been out of work for five years.
My husband died on Sept 19, 1992.”
Life has only worsened for
Hasnah since the floods. At night,
she is only able to squeeze in a few
hours of sleep in the cramped tent.
The mere sound of an engine
spurting to life or of falling rain jolts
her awake and arouses a fear that
another flood is coming. During
the day, with no house left to clean,
Hasnah said she spends the time
wandering around the village and
talking to her neighbours.
“If I just sit still, I will feel
stressed. So I walk around, I talk
to other people, I cook for everyone,” she said, gesturing towards
a kitchen stove resting on a table
which stood out in the open.
Her neighbour, Noriah Hussain,
63, is one of the few villagers whose
house had withstood the flood, but
a quick tour of her ruined home
revealed gaping holes in the floor
and in the ceiling.
“I don’t think the house will survive much longer. The ceiling panels
are falling off as we speak because
they are weighed down by mud,”
Noriah told The Malaysian Insider.
“I’m moving out. Now I’m just
waiting for my son to finish se-
03
curing the tent.”
Noriah said her family had built
the wooden house more than 30
years ago from scratch, and it was
with a heavy heart that she had to
bid goodbye to it.
At first, she thought she could
continue living there and with the
help of several volunteers, had
managed to clear almost half of the
thick mud that covered the floor.
But with her house threatening to fall apart, Noriah, like her
neighbours, is now counting on
government aid so that she will not
have to live on the streets.
“I don’t have much savings left.
I’m widowed and I have stopped
working in the oil palm estates
since 2006. If the government
doesn’t help me, I will live like
this until I die.”
Not a single villager in Kampung
Dusun Nyior that The Malaysian
Insider spoke to knew when the
government would start providing
aid to rebuild their homes, and
none was optimistic that help was
coming anytime soon.
Should there be no help coming, the villagers said they would
simply live the rest of their days in
their tents. — The Malaysian Insider
Clean water supply to resume fully next week
KUALA KRAI: Water supply to 13,817
consumers, which has been disrupted since Dec 25 due to the floods in
Kelantan, is expected to be restored
when the damaged water processing
plant is completely repaired within
a week.
Deputy Energy, Green Technology and Water Minister Datuk
Seri Mahdzir Khalid said the operators of the water division in other
states are now actively assisting,
Air Kelantan Sdn Bhd (AKSB) to
speed up repair work.
“During the floods, AKSB lost
about RM10 million when the water processing equipment at its plants
was badly damaged by flood wa-
ters,” he told reporters after visiting
the Tualang water processing plant,
yesterday.
Mahdzir said the plants that were
badly damaged and being repaired in
the Gua Musang district are in Limau
Kasturi, Aring and Bertam, while in
Kuala Krai the affected plants were
in Tualang and Stong.
He said that so far, 12 plants
damaged in the whole state of
Kelantan had been repaired to provide clean water supply to 223,300
consumers, Bernama reported.
More than two weeks since the
floods, Putrajaya has begun to divide the post-disaster reconstruction
work among government agencies.
An English daily reported yesterday that the Cabinet had instructed
Chief Secretary to the Government
Tan Sri Dr Ali Hamsa to determine
the roles of ministries and agencies to
deal with the aftermath of the floods.
It reported that Prime Minister
Datuk Seri Najib Razak at the Cabinet meeting on Wednesday ordered
a review of standard operating procedures and asset deployment strategies to ensure that authorities would
be prepared if floods of a similar scale
occurred again.
Quoting unnamed sources, the
paper said the immediate priority
is to provide temporary shelters
to victims.
“The chief secretary will have
to gather all the necessary data to
start the process of rebuilding and
reconstruction,” the daily quoted
an anonymous minister as saying.
On long-term flood mitigation
measures, the paper said the Cabinet is considering the construction
of more dams.
In addition to preventing floods,
dams can control peak flows, provide water supply, irrigation and
hydroelectricity as well as ecotourism attractions.
The paper also reported Urban
Wellbeing, Housing and Local Government Minister Datuk Abdul Rahman Dahlan saying that the Cabinet
is looking into several options for
temporary housing for flood victims.
This includes opening the 2,250
houses built under the hardcore
poor programme in Kelantan,
Terengganu and Pahang.
“We are also looking at providing them with cabins or making
use of government quarters and
national service camps as efforts
to rebuild houses are underway,”
he was quoted as saying.
National Security Council secretary Datuk Mohamed Thajudeen
Abdul Wahab told the daily that
2,660 homes in Kelantan had been
hit by floods, 20 in Terengganu and
17 in Perak.
COMMENT 19
F R I DAY JA N UA RY 9 , 2015 • T HEED G E FINA NCIA L DA ILY
Top economists leaning left
Over the past quarter century, economics has been shifting from singing the praises of free markets
BY N OA H SMI TH
A
lot of people see economics as a “conservative science”
that makes up unrealistic theories
in order to push a
free-market agenda. I don’t know
if that was ever true — maybe in
the 1970s? — but if so, those days
are long gone.
At the latest American Economic Association (AEA) meeting — the big annual economist
convention, which ended on Monday — some people turned out to
protest against what they claim is
too much mathematical formalism
in economics.
In an act of supreme irony, their
main target was Carmen Reinhart,
a Harvard economist whose most
famous work was a book about
the history of financial crises — a
famous example of modern econ
that isn’t mathematical.
Why did the protesters go after
Reinhart? Because she’s in favour
of cutting government debt. What
the protesters want has nothing to
do with methodology — they want
economics to lean more to the left.
But if the protesters bothered to
look around, they would see that
their wish has been coming true
for decades.
Over the past quarter century,
economics has been shifting from
singing the praises of free markets.
Instead, it has moved toward a
greater focus on inequality, human
welfare and the ways that markets
break down.
In academia, the shift has come
partly through the introduction of
new tools, and models that reveal
the shortcomings of unfettered
capitalism. Game theory shows
Economist and blogger Cowen rates Krugman as the
modern Friedman.
how competition can lead to waste,
and models of asymmetric information also show how markets
can fail.
Decision theory, learning theory and behavioural economics
have poked holes in the old assumptions of perfect rationality.
Even in macroeconomics, all the
focus is on incomplete and imperfectly functioning markets, as
Karthik Athreya explains in his
recent book, Big Ideas in Macroeconomics.
The move away from pure
free-marketeerism has been
helped by a flood of new data. Economics has become much more
empirical, and that has made it
much harder to wave away the
possibility of market inefficiencies.
But academic economists them-
Piketty is on Cowen’s list of the five most
influential economists.
selves aren’t very ideological in the
first place. Where the shift from
right to left has really been more
pronounced isn’t in the ivory tower, but in the public sphere.
Back in the 1970s, the public face
of economics was Milton Friedman.
A consummate public intellectual,
Friedman would travel around the
country giving lectures about the
power of free markets and the virtues of capitalism. J
Just search YouTube and you
can easily see highlight reels of
Friedman smacking down socialists and idealistic leftist youths.
He inspired a generation of bright
young conservatives to go into
economics. And before Friedman,
there was Friedrich Hayek, whose
tirade against Keynesian government intervention is still revered
by many on the right.
Look around now. Where is the
Milton Friedman of the 2010s? According to a recent post by George
Mason University economist and
blogger Tyler Cowen, the modern
Milton Friedman is ... Paul Krugman. Friedman’s Free to Choose
has been replaced by Krugman’s
The Conscience of a Liberal.
Krugman isn’t alone. Cowen’s
list of the five most influential
economists also includes Thomas Piketty, Joseph Stiglitz, Jeffrey
Sachs and Amartya Sen. Piketty,
of course, exploded on the national scene last year with a book
warning about inequality, and his
ideas were apparently all the rage
at this year’s AEA meeting. Stiglitz,
who helped invent the theory of
asymmetric information, travels
the country talking about how markets are flawed. Sachs campaigns
in favour of foreign aid to poor
countries and Sen has spent his life
trying to inject a human element
into the cold equations of econ.
On the right side of the spectrum, what popular economists
can match the appeal of Krugman, Piketty and the rest? The
only candidate is Greg Mankiw of
Harvard, who has become known
as America’s economics teacher
through his authorship of the
most popular introductory college textbook. Mankiw is a rockribbed conservative, arguing tirelessly for lower taxes on the rich.
But in terms of popular influence, he can’t match the
heavy hitters on the left. Other
right-leaning economists such
as Robert Barro, John Cochrane,
Martin Feldstein and John Taylor
pen occasional op-eds in the Wall
Street Journal, but none of them
has written a book or blog whose
popularity or influence matches
that of Krugman or Piketty.
It’s worth asking: Why has economics shifted to the left? Maybe it’s because the country itself,
and its problems, have shifted.
In the 1970s, when conservatism
and Friedman became the face
of economics, we faced high tax
rates, heavy regulation, high inflation and powerful unions. But in
2015, we confront rising inequality, economic insecurity, and the
aftermath of a financial crisis and
a long, deep recession.
Maybe a country simply gets
the economics it needs. In any
case, if you think of economics
as a bastion of conservatism and
free-market dogma, it’s time to
take another look. The winds have
changed. — Bloomberg View
China’s big year ahead
BY JI M O’ N EI L L
HALFWAY through a decade in
which China set out to rebalance
its economy, it is poised to drastically enlarge its role in the world.
Let me explain why.
Back at the start of the decade,
I made certain assumptions about
how the so-called BRIC economies — Brazil, Russia, India and
China — would perform in the 10
years ahead.
Five years on, China is the only
one of the four to have either met
or possibly slightly surpassed my
expectations. Assuming that China’s
soon-to-be-published fourth quarter gross domestic product (GDP)
number will come in at or close
to 7.3%, as many experts assume,
then from 2011 to 2014, China will
have averaged real GDP growth of
just less than 8%.
I had assumed it would be 7.5%
for the full decade (as did Chinese
leaders back in 2011), and China
could achieve this if its economy
continues to grow by 7% for the
next five years.
If so, it will have become a US$10
trillion (RM35.7 trillion) economy
in current nominal US dollars, well
more than half the size of the US
(probably even bigger, adjusting
for purchasing power), twice the
size of Japan, bigger than Germany, France and Italy put together
and not far off 1½ times the size
of the other three BRIC economies
put together.
Brazil and Russia, for their part,
have significantly disappointed my
expectations. Indeed, their economic performance supports sceptics of their long-term potential,
who attributed earlier growth primarily to high commodity prices.
India also disappointed, but its
growth rate accelerated in 2014.
With the election of Narendra Modi
as prime minister and the large
drop in oil prices, India still has
an outside chance of meeting my
expectations for the full decade. It
could even grow more than China
in the second half.
Many international commentators remain bearish about China,
expecting real GDP growth to slip
significantly below 7%. The reasons
cited usually involve some combination of excessive debt, inefficient
lending, weaker export markets and
consumers’ ongoing inability to
play a bigger role in the economy.
All of these things are relevant,
but they are challenges that Chinese
policymakers are familiar with and
seem eager to overcome.
What has become especially intriguing, in contrast to this pessimism, is how strongly Chinese equity markets have performed since
early November. For the past few
months, the Shanghai index has
been the top performing market.
What happened to all those
claims that Chinese equities never rise? The eternal bears now say
the Chinese market is an unsustainable bubble and/or that local buyers have been essentially
press-ganged into buying equities
in order to make the economy look
good. Perhaps illiquidity is playing
some role, but it seems unlikely to
be much of the story.
I can think of at least three basic reasons to be bullish on China:
First, the collapse of crude oil prices
will boost consumers’ real incomes,
helping them play a larger role in
the economy.
Second, even though property
prices have recently stalled and
begun to fall, China will probably
avoid a serious credit crunch, partly because Chinese policymakers
have been more serious about re-
straining prices before they can collapse. Moreover, the price decline
has made real estate affordable for
more Chinese.
A third reason to be optimistic
is the subdued nature of inflation
in China. This allows for more accommodative monetary policy going forward.
Taken together, these factors
will make it easier for China to rebalance its economy — by raising
wages, increasing property ownership rights for urban migrants and
reforming pension systems.
In 2016, when China — with
its economy growing at 6% to 7%
— chairs the Group of 20 nations,
it can do so as a fully engaged
member of the global economy.
— Bloomberg View
Jim O’Neill is a Bloomberg View
columnist.
2 0 P R O P E RT Y
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
Federal Republic of
Germany land up for sale
BY ZAT I L H U SNA WAN FAUZI
KUALA LUMPUR: Two parcels of land owned
by the Federal Republic of Germany in the
city centre are being sold via tender by Rahim & Co Chartered Surveyors Sdn Bhd.
The plots are in Jalan Kia Peng and Jalan
Tun Razak, measuring 1.87 acres (0.75ha)
and 0.38 acres, respectively.
The Jalan Kia Peng land is a freehold
mixed-use residential plot, and is next to the
KL Convention Centre. It currently houses
a vacant mansion with staff quarters and
swimming pool, and was the former residence of the German ambassador. The land
has a guide price of RM2,300 per sq ft (psf ).
The Jalan Tun Razak plot is next to the
Brazil embassy and has two vacant detached
buildings. It is a freehold commercial land
and used to house the Goethe-Institut, a
cultural centre. The land has a guide price
of RM1,500 psf.
According to Rahim & Co head of investments, James Goh, the guide prices are
based on a plot ratio of six as indicated by
the Kuala Lumpur City Hall. The Federal
Republic of Germany has vacated both
plots more than 10 years ago.
The tender exercise opened on Dec 15,
Goh says the two parcels of land can expect
higher bids based on the previous sale of the
British High Commission plot. Photo by Mohd
Izwan Mohd Nazam
2014 and will conclude on Jan 26, 2015,
said Goh.
“Based on our experience with the British High Commission, which put its land
up for sale two years ago, we can expect
buyers to place higher bids for the land.”
The 3.07-acre British High Commission plot was sold to S P Setia Bhd for
RM2,200 psf — higher than the guide price
of RM1,500 psf.
He noted that it’s a trend for embassies
to sell their land as part of an exercise to
trim their countries’ budgets.
Most embassies prefer to move into
green-certified office buildings or those
that have green features.
“Moving into office buildings [reduces]
management costs compared with managing large tracts of land,” Goh said.
Best Western hotel opens in Shah Alam
BEST WESTERN
BY EL EN A T U NKU SHER IE
SHAH ALAM: Best Western International,
one of the world’s largest hotel chains with
4,000 hotels in over 100 countries, has opened
its first hotel in Shah Alam.
Best Western i-City Shah Alam is in the 72acre (29ha) i-City next to i-City Waterworld.
i-City is developed by I-Bhd.
“As Selangor’s capital, Shah Alam is a
key economic hub in Malaysia. Located just
25km from Kuala Lumpur and 30km from
the Kuala Lumpur International Airport, the
city is at the heart of the country’s development and provides an ideal setting for Best
Western’s new generation of contemporary
hotels,” said Best Western International senior vice-president of brand management
and development, Ron Pohl.
The RM50 million development will feature an 18-storey building with 214 guest
rooms and suites comprising 144 superior
rooms (priced at RM450 nett), 58 deluxe
rooms (RM500 nett) and 12 suites (RM700
nett). The rooms range from 19 sq m to 35
sq m in size.
“Malaysia is an incredibly exciting market for Best Western International. With five
hotels already open [in Kuala Lumpur, Ipoh,
Kota Kinabalu and Sandakan], and eight
more in the pipeline, we look forward to
serving the needs of our guests,” Pohl said.
Ahmedabad poised
to be an auto
manufacturing hub,
reports JLL
BY L IM K IA N W E I
GURGAON: Ahmedabad is poised to
be an automobile manufacturing hub
in India, said Jones Lang LaSalle Property Consultants Pvt Ltd (JLL) Monthly
Real Estate Monitor in November 2014.
According to the report, industrial
developments at Sanand and Bechraji,
25km and 100km from Ahmedabad respectively, are to be developed as automobile manufacturing hubs in India.
The city, with its many textile, pharmaceutical and chemical industries,
has seen rapid industrial growth.
Quality infrastructure, competitive
real estate cost and well administered
law and order make Ahmedabad a desirable residential and business destination.
The residential market in Ahmedabad is diverse with units starting from as low as 500,000 rupees
(RM28,100) in the affordable category
to as high as 50 million rupees in the
ultra-luxury category, said JLL. The city
also has a mall and high-street retail
developments, while the Prahaladnagar and Satellite area has emerged as
the new office hub of Ahmedabad. The
Gujarat International Finance Tech
City is also near Ahmedabad, which
is planned as a smart city.
The two plots in KL city centre will be sold via tender
01
BEST WESTERN
01. An artist’s impression of the guest room.
02. An illustration of the restaurant.
02
FR I
Quality infrastructure,
competitive real
estate cost and well
administered law
and order make
Ahmedabad a
desirable residential
and business
destination.
Meanwhile, the bus rapid transit
system (BRTS) contributed to the rise
of real estate prices on the outskirts
of Ahmedabad. There are plans to increase the floor space index and have
a transit- oriented development along
the BRTS corridor, which will further
boost economic activities in the city.
The Indian government has taken
initiatives to develop affordable housing in the city and eased foreign direct
investment for the construction sector
to attract investments in October 2014.
Among the proposed new rules are
the reduction of built-up area from
50,000 sq m to 20,000 sq m, and the
reduction of minimum capital requirement from US$10 million (RM35.7
million) to US$5 million. The move
was hailed by the real estate industry
as it will help developers to raise foreign funds, said JLL.
In October 2014, office space in
Ahmedabad saw a notable rise in demand. The Prahlad Nagar precinct,
9km from the city, registered a rental
value of between 35 rupees and 50 rupees per sq ft (psf ) and capital value
from 6,000 rupees to 7,000 rupees psf.
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P R O P E RT Y 2 1
F R I DAY JA N UA RY 9 , 2 015 • T HEED G E FINA NCIA L DA ILY
SAFFRON
HOT DEALS
How much is your property worth?
Which and what property has just been
sold, and for how much? What interesting
buys are now on the market? Check out
the following Hot Deals of the week.
Go to www.theedgemarkets.com for more.
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2-storey link house in Bandar Botanic,
Klang, Selangor
Built-up: 1,800 sq ft; 4 bedrooms; 3
bathrooms; Freehold; RM590,000
The intermediate unit has an extended and
renovated kitchen and porch. It is also partially furnished with a built-in book rack,
built-in wardrobes, air-conditioning units
in all rooms and water heaters for all bathrooms. Bandar Botanic is easily accessible
via the Kesas Highway.
Contact: Ridian Tan of Reapfields Properties
(Klang) Sdn Bhd (012) 730 0937.
An artist’s impression of the living room of a Royal Dockside unit.
On the market
Zerin, Saffron present London’s
Royal Dockside
SAFFRON
BY EL EN A T U NKU SHERIE
KUALA LUMPUR: This weekend local real
estate investment house Zerin Properties
Sdn Bhd and London luxury property agent
Saffron International will be showcasing the
London project Royal Dockside at Docklands.
The event will be held at Saffron KL, 73 Jalan
Maarof, Bangsar, Kuala Lumpur.
Developed by London developer One
Housing Group, the project comprises a
series of luxury apartments and penthouses near the upcoming Asian Business Port
and London City Airport.
Zerin Properties chief executive officer
Previndran Singhe said the development
is set to be the next big thing because of its
prime location.
“The airport is most [important to] this
development, apart from [the development]
being a regeneration project,” he said. “People [nowadays] fly in and out for work. Here,
the airport is just minutes away. I [believe]
investors can expect high capital appreciation of about 30% in the next five years.”
“We liked the Chinese factor, the fact
that the Chinese Business Park is literally
on your doorstep (400m away) apart from
being close to the University of East London
and the Docklands Light Railway,” added
WHAT’S
HAPPENING &
WHERE
An artist’s impression of the kitchen of a Royal Dockside unit.
Saffron director Monty Nawaz.
The Asian Business Port is the result of a
deal involving London Mayor Boris Johnson, Chinese developer Advanced Business
Park Holding Group and British developer
Stanhope plc.
The site is to be redeveloped for an office
complex, homes and shops owned mainly
by Chinese companies.
The £34 million (RM183.67 million) Royal Dockside will feature 76 units with one- to
four-bedroom homes. Prices are from £270,000.
Previndran and Monty said that while
the year may start off slower compared with
last year, they are optimistic it will gradually
pick up with a 4% to 5% increase in London
property prices.
The development is already 57% taken up
from its previous launches last year in March
(Hong Kong) and May (Kuala Lumpur). However, these were prior to the port’s approval.
The development will sit on 1.11 acres
(0.44ha) of leasehold land and is due to be
completed in the first quarter of 2016.
Slow times for luxury homes
BY EL EN A T U NKU SHERIE
KUALA LUMPUR: Prices of luxury homes
across 33 cities saw an increase of only
0.2% in the third quarter of 2014 (3Q14),
the weakest performance in two years, reported Knight Frank’s Residential Research
Prime Global Cities Index 3Q14.
Prime residential prices rose 4% over a
12-month period, down from 6.6% a year earlier. Despite the index’s muted performance,
luxury prices continue to outperform their
mainstream counterparts, said Knight Frank.
The prime index stands at 36.3% above
its low in 2Q09, while the mainstream global index rose 14.3% over the same period.
Tokyo recorded the strongest quarterly
growth, while Jakarta saw the strongest an-
2-storey terraced house in USJ 3, Subang
Jaya, Selangor
Built-up: 1,800 sq ft; 4 bedrooms; 3
bathrooms; Freehold; RM660,000
The house is a partially furnished intermediate unit with wardrobes, and kitchen
cabinets and cooker hoods. The kitchen
has also been renovated and extended. The
neighbourhood is accessible via the Kesas
Highway, NPE and Federal Highway.
Contact: CY Yong of GS Realty Sdn Bhd
(016) 878 4628.
nual rise in luxury prices.
On a quarterly basis, Tokyo and Cape
Town were the strongest performers, with
prices ending the three-month period at
9.2% and 6.3% higher, respectively.
Despite topping the ranks with prices
reaching 27% in the year to June, Jakarta has
seen a sharp deceleration in prices, with prices rising only 2.5% in the first half of the year.
The rate of luxury price growth declined in
Dubai due to temporary factors such as Ramadan and the Central Bank of the United Arab
Emirates’ mortgage cap, which is stricter for
those purchasing properties above 5 million
dirham (RM4.86 million).
Between cities in the United States and
those in Europe, there is a stark disparity.
Luxury homes in North American cities in-
creased 10.5% on average in annual terms
and by comparison, averaged a 1% rise in
European cities.
The 3Q also marks the inclusion of Seoul
for the first time. Prices in the South Korean
capital are continuing their recovery since
hitting a low in 2013.
The moderate price growth of the index
is partly due to 3Q being dominated by the
summer holiday season which contributed
to slower sales activity, thus reducing the
pressure on prices.
The prospect of tightening monetary policy in the US, an approaching general election
in the United Kingdom, cooling measures in
major Asian cities and negative economic
indicators in Europe are among the factors
that also play a part.
Penang International Property
Summit and International Property
Expo 2015 (PIP)
Date: Today until Sunday
Venue: sPICE Arena Penang (Pisa)
Time: 11am to 9pm
Contact: (04) 296 1333
The PIP conference will have experts discussing a wide range of issues in the property industry. Among the highlights are the
CEO Roundtable Dialogue with the Penang
chief minister, and a panel discussion on
affordable housing. The expo features developments such as IJM Land Bhd’s The
Light, which is part of the Greater Penang
Masterplan.
Launch of Bandar Puteri Bangi
Date: Tomorrow and Sunday
Venue: IOI Galleria, Bandar Puteri Bangi
Time: 10am to 5pm
Contact: (03) 8912 3333
IOI Properties Bhd is launching its Bandar
Puteri Bangi township. The freehold project
offers three developments: the Terresse 2-storey superlink homes, the Almyra Residence
serviced apartments and the Kubica Square
3- and 4-storey shop offices.
22 F E AT U R E
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
World Bank sees
slower track for
global trade engine
Lacklustre recovery from the financial crisis expected to persist
G
lobal trade should
expand more slowly over the next decade than it did in the
30 years before the
financial crisis, the
World Bank said on Wednesday,
citing forecasts for slower economic growth and longer-term shifts in
trade patterns.
For the three decades leading
up to the global financial crisis of
2007 to 2009, trade had expanded
at a steady clip of about 7% a year.
But trade growth levels have fallen to about half that for the past two
years, and should only rise to about
5% over the medium term, four World
Bank economists said in an essay.
International trade helped the
global economy tide over rough
spots in the two decades before the
financial crisis, when it grew nearly
twice as fast as economic output.
But recent data show the trade engine is running out of steam.
The authors point to the lacklustre recovery from the financial crisis, which the World Bank expects
to persist. And data show import
demand levels may be a fifth lower
than they would be otherwise even
five years after an economic crisis.
Weak spending on investment
since the crisis, especially in the
eurozone, has also sapped trade
growth. Investment is especially reliant on imports compared to other
economic drivers like consumption
and government spending.
But deeper factors have also
tamped down trade expansion. China’s reduction of trade barriers and
the fragmentation of production into
global supply chains boosted trade
at the end of the last century, factors
that would be hard to replicate now.
Countries like the United States
and China are also making more
inputs for final products closer to
home, the economists write.
“Global trade is growing more
slowly not only because world
income growth is lower, but also
because trade has become less
responsive to income growth,” according to the essay.
Polic ymakers are hoping
far-reaching regional and global
trade pacts could help trade growth
regain some lost momentum.
The World Bank said more integration of South Asia, sub-Saharan
Africa and South America into global supply chains would also help.
“Drawing these parts of the
world into a finer division of labour
could lend renewed dynamism to
trade,” the bank said. — Reuters
For JPMorgan, breaking up could be hard to do
BY JEFF COX
THE JPMorgan Chase (JPM) breakup drumbeat is starting up again
on Wall Street.
With the largest holding company in the United States by assets
(US$2.53 trillion or RM9.03 trillion)
in regulator crosshairs, industry
analysts are wondering how long it
will be before the company splits up
and how a break-up would occur.
The bank itself has been mum
about its future in that regard, but
that hasn’t stopped a growing swell of
speculation about what will happen.
Sparking the latest round was the
Federal Reserve’s move to make JPM
effectively hold 12% of capital as a
required buffer against the type of
systemic breakdown that precipitated the financial crisis in 2008
and 2009. Through stress tests and
additional measures, the Fed and
other regulators are looking to prevent another “too big to fail” event.
But the capital requirement at
least on its face is greater than its
peers, increasing anticipation that the
anti-JPMorgan crowd may finally get
its wish and see the firm split into as
few as two or as many as four pieces.
The Fed’s capital proposal had the
effect of “reigniting the debate about
whether a break-up could unlock
shareholder value given that size is
now a regulatory negative,” Goldman
Sachs analyst Richard Ramsden and
others said in a note to clients.
The analysis noted that JPM could
be “a victim of its own success,” targeted in part because its ability to grow
in the face of a challenging environ-
ment has made it a regulator target.
Indeed, there is strong irony
about the company’s disfavour:
It is as large as it is also in big part
because it not only absorbed Chase
when it was reeling but also took
on other flagging banks — Bear
Stearns and Washington Mutual — during the financial crisis,
largely at the Fed’s behest. While
the deals were done at terms that
favoured JPMorgan, the moves arguably helped stem damage from
the crisis.
The company is coming off a
strong year at least in terms of revenues. The firm ranked at the top
for investment banking fees, raking
in US$6.3 billion or 7% of market
share, according to Thomson Reuters data. JPM was the top bank in
six different sectors.
Goldman believes a break-up
into two or four parts, depending
on your choice of scenario, “could
unlock [shareholder] value in most
scenarios although the range of
outcomes we assessed is wide, at
[5% to 25%] potential upside.
“Upside is sensitive to the magnitude of the multiple rerating, the
speed and size of potential capital
returns from each stand-alone business, and reductions in estimated
synergies,” the report said.
However, Ramsden’s report cautions of the “execution risk” involved — essentially, that JPM is
so big that breaking it into smaller
parts would be labour-intensive
with many moving parts.
Besides, the surviving entities
would be so big themselves that
they may not get much of a break
themselves in terms of capital requirements.
Banking analyst Christopher
Whalen handicaps a 1-in-3 chance
that JPM executes a big break-up,
and probably a better chance that
it begins to sell off assets in a more
gradual manner. The latter scenario,
he said, is likely with many big institutions, with a move like a break-up
of the Bank of America-Merrill Lynch
marriage put together during the
crisis a decent probability.
In JPM’s case, the result, then,
could be a simple separation of
JPMorgan and Chase, ending the
merger put together in 2000 and
separating institutional and consumer operations.
“If you really start breaking these
things up, you call into question
why the Fed put them together in
the first place” said Whalen, senior
managing director at Kroll Bond
Rating Agency. “They kept slamming dead banks together because
they didn’t know what else to do.”
He expects some form of “voluntary break-up” to occur for both a
company and an industry that regulators are having a difficult time
trying to control in a post-crisis
environment.
“Now you have a huge concentration in asset classes, and these
things are too big — they’re really
too big to manage,” Whalen said.
“The Fed is struggling for a way
to approach these issues,” he added.
“They never should have put these
guys together in the first place.”
— CNBC
Filepic of private yachts berthed outside luxury condominium apartments at Sentosa
Cove in Singapore. Of the top 10 loss-making sales in 2014, four were located in
Sentosa and four in the Orchard Road area. Photo by Bloomberg
Singapore property
— are foreigners
about to bail out?
BY ANSUYA HARJANI
RESALE prices at luxury projects in
neighbourhoods popular among
foreign buyers took a hit in 2014,
raising concerns that foreigners
could exit Singapore’s real estate
market en masse.
Last year saw several high-end
apartments in the city state’s exclusive enclave of Sentosa Cove and
the highly sought-after address of
Orchard Road sell at hefty losses.
The highest loss-making transaction was a four-bedroom apartment at the Turquoise@Sentosa,
which was sold for S$3.9 million
(RM10.4 million) in July 2014, almost half the S$7.1 million it was
originally bought for in November
2007, according to data compiled
by Malayan Banking Bhd.
Of the top 10 loss-making sales
in 2014, four were located in Sentosa and four in the Orchard Road
area, which historically have attracted much higher foreign interest than other parts of the island.
“The concern around foreigners exiting en masse came about
because resale values in foreign
enclaves such as Orchard and Sentosa have dropped more than other areas,” Ng Wee Siang, head of
research at Maybank told CNBC.
“While there have been more fire
sales, some of them have their own
peculiar reasons — we can’t jump to
the conclusion that it is because foreigners are walking away,” he added.
An analysis of the top 30 projects
with the highest level of foreigner
ownership indicates that valuations
have largely been resilient, said Ng.
These include apartment buildings
such as Rivergate, City Square Residences and Costa Del Sol.
“This supports our view that luxury homes sold at large losses are
sporadic and isolated to selected
projects,” he said.
Overall, prices of private residential property in the city dipped
4% in 2014, according to a flash
estimate by the Urban Redevelopment Authority.
Donald Han, managing director
at Chestertons Singapore, shares a
similar view. “There will always be
buyers that need to cash out, but
we have seen rampant cases of such
sellers,” he said.
Some fire sales last year occurred
because buyers were asked by banks
to top up their loans due to a decline
in the valuation of their properties
and instead of putting in additional
cash, they decided to exit their investment, Han said.
Ng sees minimum risk of a massive withdrawal of foreign cash from
the housing market without a global
economic collapse.
“Foreigners may be concerned
about the fall in resale values, but
I don’t think there will be panic. If
you look at Singapore, over the past
10 years, it’s becoming a wealth and
private banking hub, so a lot more
rich people reside here compared
to before.”
Over the last decade, foreigners
from around the region have flocked
to buy property in Singapore — a
city that boasts a stable economy
and superior quality of life.
At the peak, in the fourth quarter
of 2011, overseas buyers accounted
for over 20% of non-landed property transactions on the island, according to Maybank.
While the proportion of foreign
buyers has since declined, they still
play a key role in the market. In
the third quarter of 2014, foreigners accounted for roughly 10% of
transactions.
Han agreed, adding that the
strength of the Singapore dollar
vis-à-vis regional currencies and
relative stability of the market will
keep foreign investors from heading for the exit. — CNBC
For more, visit www.cnbc.com
24 W O R L D B U S I N E S S
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
StanChart to cut 2,000 jobs
London-based bank also closing its loss-making cash equities operation
REUTERS
BY A L FRED L I U
HONG KONG: Standard Chartered
plc (StanChart) is closing its institutional equities business, eliminating
about 200 jobs ahead of plans to cut
2,000 more staff as chief executive
officer Peter Sands (pic) tries to turn
the UK bank around.
Shutting the loss-making cash
equities, equity capital market and
equity research operations will save
about US$100 million (RM357 million) in 2016, the London-based
bank said in a statement yesterday.
It will keep its convertible bonds
and equity derivatives businesses,
as well as economic and fixed-income research.
Sands, who turned 53 yesterday,
plans to cut US$400 million of costs
this year to stem profit declines that
led the shares to plunge the most in
six years in 2014. StanChart stands
apart from its peers in exiting the
business of managing companies’
share offerings as it unwinds an expansion pursued since the global
financial crisis.
“The shares are up today [yesterday] on the news but this announcement is not enough to
convince the market that the bank
is on the road to recovery,” Jim Antos, a Hong Kong-based analyst at
Mizuho Securities Asia Ltd, said in
an email yesterday. “What we need
is a clear statement from management about the way forward.”
Shares in the UK bank rose 2.4%,
the biggest advance in almost three
weeks, to HK$114.50 (RM52.62)
at 2.14pm in Hong Kong trading
yesterday. They earlier pared gains
after reports on the exit. The stock
slid 33% in Hong Kong last year.
Xiaomi buying spree gives Apple,
Samsung new reasons to sweat
BEIJING: Xiaomi Corp zoomed
past Apple Inc and Samsung Electronics Co in China smartphone
sales just three years after releasing its first model. Founder Lei
Jun is now on a buying spree to
take that momentum beyond
handsets.
Since November, the maker
of Mi devices has participated
in more than US$600 million
(RM2.14 billion) of investments
in three companies and announced it bought into dozens
of start-ups making everything
from air purifiers to low-energy
light bulbs.
Xiaomi, which doubled revenue to US$12 billion last year,
could be just getting warmed up.
Lei wants to be No 1 in smartphone sales and has committed
to spending US$1 billion on content as he seeks to build a brand
bigger than Apple and Samsung
within a decade. Much like with
Apple’s success, the idea behind
his investments is to assemble
enough products and services
that customers will be glued to
Xiaomi.
“Xiaomi is expanding into
the smart home and following
the lead of Apple, Samsung and
others,” said Neil Mawston, executive director of researcher
Strategy Analytics. “We expect
Xiaomi to build an ecosystem
of Mi devices and apps for the
home, office and car.”
Lei’s push has credibility because of Xiaomi’s roots in software. The Beijing-based company only started selling phones
after developing an adaptation of
Google Inc’s Android software
called MIUI, which now has more
than 85 million users worldwide.
Xiaomi is the world’s fastest growing smartphone maker and ranks
No 3 globally. — Bloomberg
About half of the cost savings
planned for this year will come from
its retail clients business, StanChart
said yesterday. The bank cut about
2,000 jobs in the past three months
as it focused on key cities and accelerated a switch to digital banking,
with a further 2,000 reductions anticipated this year, it said. It shut 22
branches in the second half of 2014
as part of a previously announced
target of 80 to 100 closures.
StanChart reiterated in the statement its plans to exit or restructure
“non-core” operations. The bank
makes about three-quarters of its
profit in Asia, where more than
900 of its over 1,600 branches are
located, according to its website.
“Investors should feel reassured
that Standard Chartered is moving
forward on its cost-cutting measures,” Edmond Law, a Hong Kongbased analyst at UOB-Kay Hian
(Hong Kong) Ltd, said by phone
yesterday. “It’s the right direction
to focus on its core business.” —
Bloomberg
Oil investors pour
money into funds
BY M O M I NG Z HO U
NEW YORK: Investors betting oil
will rebound from the lowest prices
in 5½ years poured the most money
in more than four years into funds
that track crude.
The four biggest oil exchange-traded products listed in
the United States received a combined US$1.23 billion (RM4.39
billion) in December, the most
since May 2010, according to data
compiled by Bloomberg. Another
US$109.9 million was added this
month through Monday.
Investors are piling into oil exchange-traded funds (ETFs) even
after West Texas Intermediate
(WTI) crude, the US benchmark,
tumbled the most since 2008 last
year amid signs of rising supply and
weak demand. Shares outstand-
ing of the four funds surged to the
highest since 2009.
“Commodity investors can be
contrarian investors,” said Matt
Hougan, president of San Francisco-based research firm ETF.com.
“There are a lot of true believers
in the commodity space. A lot of
people are attached to the idea
that oil’s natural price should be
US$100, not US$50.”
The US Oil Fund, the biggest oil
ETF, attracted US$629.9 million in
December and US$100.4 million
so far this month. The fund, which
follows WTI prices, added 1.8% to
US$18.369 on Wednesday on the
New York Stock Exchange.
The four funds also include ProShares Ultra Bloomberg Crude Oil,
iPath S&P GSCI Crude Oil Total Return Index ETN and PowerShares
DB Oil Fund. — Bloomberg
IN BRIEF
Baby food recalled over
cricket contamination
TOKYO: A Japanese firm said
yesterday it was recalling tens
of thousands of pouches of
baby food after an insect was
discovered in one package, the
latest food scare to rock consumers. Asahi Holdings said
its subsidiary would be calling
back an estimated 120,000 bags
of the meat-and-potatoes mix
after one was found to contain
a cricket. Baby brand Wakodo received the complaint last
month from a customer who
bought the pack in Tochigi,
northeast of Tokyo, and reported it included a 7.4mm insect,
the two companies said. — AFP
Thailand sees cheaper
phone charges by March
BANGKOK: All mobile phone
service providers will offer new
promotional packages by March
which will see callers charged
on a per-second basis in a step
which could overhaul the entire system in the future. The
agreement was reached in a
meeting between the National
Broadcasting and Telecommunications Commission (NBTC)
and Advanced Info Service,
Total Access Communication,
True Move, TOT Pcl and CAT
Telecom Pcl. The meeting followed criticism of the NBTC on
Tuesday by the National Reform
Council for turning a blind eye
to excessive charges by phone
companies. — Bangkok Post
GIC to invest further in
India real estate
SINGAPORE: Private equity
fund KKR & Co said yesterday
it had set up a non-banking financial company in India for
lending to the real estate sector,
with an investment from Singapore sovereign wealth fund GIC,
The Straits Times reported. This
would be GIC’s third investment
in India’s real estate sector in
two months. In December, it
announced plans to buy a controlling stake in Mumbai-based
real estate firm Nirlon Ltd for
around US$200 million (RM714
million). Earlier in the month,
GIC entered into a joint venture
with Indian firm Vatika Group.
Asia’s central banks are behind rate-cutting curve
BY A NDY MU KHER JEE
SINGAPORE: Asia’s central banks are
in danger of falling behind the yield
curve. The region’s monetary authorities have so far failed to heed bond
investors’ legitimate worries about
disinflation. Their reticence could
imperil both gross domestic product
growth and financial stability.
Investors have been pushing
down interest rates across Asia.
The average yield on 10-year sovereign bonds issued by the region’s
10 major economies has fallen by
almost 80 basis points over the past
year. Yet short-term policy rates
have barely budged. The narrowing
gap shows that the growing sense
of alarm over disinflation in the
marketplace has yet to upset the
relative calm in policymakers’ ivory
towers. That could turn out to be
an error of judgement.
Central banks may be worrying about a repeat of the mid-2013
“taper scare”, when the prospect of
higher interest rates in the United
States prompted foreign investors
to flee Asian markets. If that’s the
case, they are fighting yesterday’s
battles. Yields on 10-year US bonds
have dipped below 2%; Japanese
government debt of similar maturity yields 0.28%, a record low. Hot
money will only flow out of the region if rates in advanced economies
are much more attractive.
A more valid concern is that lower rates will drag down exchange
rates, making foreign currency debt
more expensive to service. That
might be especially problematic for
China, which owes US$1.1 trillion
(RM3.93 trillion) in cross-border
claims, according to the Bank for
International Settlements.
Some central bankers may be
hoping that cheaper energy will reignite global and domestic growth.
Such complacency is plain wrong.
Inflation expectations in the region
could slide further as companies
receive lower prices for their goods
and services and workers get lacklustre raises. If producer prices and
wages don’t grow, the already-high
real corporate debt burden in China
and the household debt overhang
in Malaysia, South Korea, Thailand
and Singapore would worsen.
China, South Korea and Thailand cut rates last year. All three
need to do so again. Australia and
India would have to join in. Malaysia, Indonesia and the Philippines,
which raised rates last year, should
at least avoid further increases. The
longer Asian central banks take to
decode the disinflation risk, the farther they will fall behind the yield
curve. — Reuters
26 W O R L D B U S I N E S S
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
China to invest US$20b
in struggling Venezuela
It has agreed to ‘strengthened cooperation’ with the South American country
CARACAS: China has agreed to
more than US$20 billion (RM71.4
billion) in investments in economically struggling Venezuela, the
South American nation’s president,
Nicolas Maduro, said on Wednesday during a summit meeting in
Beijing. Maduro arrived on Tuesday in Beijing, where he has been
meeting China’s President Xi Jinping, at a critical time for Venezuela
which is in the throes of financial
crisis from falling oil prices.
“We scooped up more than
US$20 billion in investment,” Maduro told Venezuela’s official AVN
news agency.
He did not say whether new
loans from China were included
in that figure, or whether it included previously announced investment deals.
Xi said that China, the world’s
second biggest economy which
has been bolstering its diplomatic and economic reach in South
America, had agreed to “strength-
Maduro (centre) greeting Xi as Costa Rica’s President Luis Guillermo Solis (left) looks
on during the China-Celac (Community of Latin American and Caribbean States)
Forum in Beijing yesterday. Photo by Reuters
ened cooperation”.
The sweeping investment deal
covers a wide range of areas including technology, housing and
urban planning, AVN said.
The meeting between the two
Fed worries about international
risks to US economy
BY VERON I CA S M ITH
WASHINGTON: The US Federal Reserve worried about foreign risks
to the US economy but could raise interest rates despite weaker
than desired inflation, according to the minutes of the last meeting published on Wednesday. “Many participants regarded the
international situation as an important source of downside risks
to domestic real activity and employment,” said the minutes of the
Dec 16 and 17 meeting of the Federal Open Market Committee.
The potential for weaker US economic growth would rise “particularly
if declines in oil prices and the persistence of weak economic growth
abroad had a substantial negative effect on global financial markets,”
the minutes said, “or if foreign policy responses were insufficient.”
The outlook for growth in the eurozone, Japan and China has
dimmed and slumping oil prices are battering the economies of
Russia, Venezuela and other oil-exporting countries.
The final 2014 meeting of the Fed’s policy arm came amid a
plunge in oil prices since June that has further deepened, more
than halving the value of crude oil to below US$50 (RM178.50) a
barrel currently.
The sharp fall in oil has roiled financial markets, especially in
the first trading days of the year, as investors worry about weaker
demand in a slowing economy and a global oil supply glut. — AFP
leaders is their third, after talks in
Beijing in September 2013 and another in Caracas last July.
China is Venezuela’s largest investor and the second largest purchaser of its oil.
Caracas last week announced
that it has entered recession, a
heavy blow for an already beleaguered economy where annual
inflation tops more than 60%.
Plummeting global oil prices
have caused additional distress for
Venezuela, a member of the Organisation of the Petroleum Producing
Countries that relies heavily on its
oil revenue to keep its lumbering
command economy afloat.
Analysts have warned that socialist Venezuela is on the brink of a debt
default, struggling to pay its bills while
maintaining its lavish subsidies, oil
discounts to allies and rigid system
of foreign exchange controls.
China has been a key ally of Venezuela since Maduro’s predecessor Hugo Chavez came to power
in 1999.
Beijing has extended US$42 billion in long-term loans to Venezuela, US$24 billion of which has
been paid out so far, according to
Venezuelan officials. — AFP
Beijing pushes for
bigger role
BEIJING: Chinese President Xi Jinping pledged to increase cooperation with Latin America and the
Caribbean yesterday as he opened
a forum in Beijing with leaders from
30 countries in the region.
The China-Celac (Community
of Latin American and Caribbean
States) gathering comes as China
pushes for more influence in what
has traditionally been Washington’s
backyard, and with many in the
area looking to the Asian nation
to offset US dominance.
“China will focus on overall
cooperation with Latin American
countries and this forum will build
a deepening discussion,” Xi said
in a speech televised live from the
Great Hall of the People.
“Expanding cooperation discussions at this forum will determine
deepening integration with Latin America in the next five years
in fields including security, trade,
finance, technology, energy, resources, industry and agriculture,”
he said.
Xi also reiterated a plan first
mentioned during a tour of Latin
America last year to raise annual
trade to US$500 billion (RM1.78
trillion) within a decade and to increase direct Chinese investment
in the area to US$250 billion. But
in a sign that the meeting was not
entirely about trade, China’s official
Xinhua news agency made it clear
the country wants to increase its
regional influence. — AFP
IN BRIEF
Chip sales cushion
Samsung 4Q
profit decline
SEOUL: Samsung Electronics,
the world’s largest smartphone
maker, flagged a lighter than
expected profit decline in the
fourth quarter yesterday, with
memory chip sales cushioning a continued slump in mobile revenue. Operating profit
for the October to December
period was estimated at 5.2
trillion won (16.92 billion),
down 37.4% from the fourth
quarter of 2013, the company
said. The performance beat
analyst forecasts with profits
from high-margin chip sales
helping to offset the downturn
in the key mobile sector which
has struggled in the face of intense competition from cutprice Chinese rivals. — AFP
Google loses most US
search share since 2009,
Yahoo gains
SAN FRANCISCO: Google
Inc’s dominance of the US Internet search market slipped
last month in the biggest drop
since 2009 while Yahoo! Inc
posted its largest share gain, as
the companies grappled with
the fallout of a search deal
on Firefox browsers. Google’s
slice of the US search market
fell to 75.2% in December from
79.3% a year ago, while Yahoo
jumped to 10.4% from 7.4%,
according to analytics firm
StatCounter. That put Google at its smallest share of the
US Web search market since
at least 2008 and the highest
share for Yahoo since 2009. —
Bloomberg
Thailand to raise
wholesale price of LPG
by almost half
BANGKOK: Thailand’s military-backed government will
raise the wholesale price of liquefied petroleum gas by almost half to US$488 (RM1,742)
a tonne from Feb 2, bringing
it close to import costs. The
move is part of Thailand’s attempt to restructure domestic
gas prices to more fully reflect
market prices and cut the subsidy burden on state-controlled
PTT Pcl, the country’s sole gas
supplier. The government is
also considering adjusting domestic gas prices to reflect actual costs, the energy minister
said. — Reuters
Falling prices show ECB failed at its only mandate
BY SWA HA PATTANAIK
LONDON: Eurozone prices are falling annually, for the first time since
2009. Investors’ faith in the European
Central Bank’s (ECB) ability to deliver on its “price stability” mandate is
falling even faster — and rightly so.
Cheaper oil was largely responsible for the 0.2% annual decline in
consumer prices reported for December by the European Union statistics office. Even so, the ECB can
hardly be absolved from responsibility for missing by such a huge margin
its self-imposed target of keeping
inflation “below but close” to 2%.
The central bank has seen inflation in the monetary union fall
further and further below the target since 2013. A number of eurozone members have been reporting sub-zero rates for some time.
In 2009, by contrast, the inflation
rate dropped suddenly and sharply.
Investors’ dwindling confidence
in the ECB’s ability to fulfil its mission is another danger signal which
has been flashing for some time.
The central bank may well focus
on the medium term, rather than
being swayed by monthly figures.
But its own preferred “five-year/
five-year forward” gauge, which
tracks how investors expect prices
to behave over a five-year period
starting five years from now, has
been on a downward trajectory
for five months. It hit a record low
of 1.58% on Tuesday. Inflation expectations never fell to such lows
even at the height of the financial
crisis, the last time consumer prices
were falling annually.
The central bank can’t be accused of inaction. It has lowered
its key policy interest rate to near
zero, and taken measures to improve the flow of credit. But the eagerness of president Mario Draghi
to build a consensus for action has
prevented him from acting in time
to counter the deflation threat. And
he has mostly cobbled together
compromise measures, rather than
launching the all-out quantitative
easing which is now a step closer.
Draghi said in a New Year newspaper interview that the risk of the
ECB failing to fulfil its price stability
mandate is higher now than half a
year ago. The reality is that the ECB
has already failed, and needs to
take strong action, without delay.
— Reuters
W O R L D 27
F R I DAY JA N UA RY 9 , 2015 • T HEED G E FINA NCIA L DA ILY
Seven detained in hunt
for Paris media killers
Police release photos of two brothers said
to be involved in killing of 12 people
PARIS: Seven people have been
detained in the hunt for brothers
suspected of gunning down 12
people in an Islamist assault on a
satirical weekly, Interior Minister
Bernard Cazeneuve said yesterday.
The masked, black-clad gunmen
burst into the offices of the Charlie
Hebdo magazine on Wednesday
morning, killing some of France’s
most outspoken journalists and
two policemen, before jumping
into a car and escaping.
They are still on the run, and
authorities have warned they are
“armed and dangerous.”
“Seven people,” Cazeneuve said
on French radio when asked how
many people were currently being
held and questioned over the attack — the bloodiest in France in
half a century.
A judicial source, who refused
to be named, added that those
who were being questioned are
Brunei bans
Christmas
celebrations
in public
KUALA LUMPUR: Oil-rich Brunei has banned public celebrations of Christmas for fear of
Muslims being led astray, its
religious affairs ministry said
yesterday, in a country that last
year controversially instituted
tough Islamic syariah penalties.
The ban, instituted after
Christmas last month when
local children and adults were
seen wearing clothes “that
resemble Santa Claus”, raises
fresh concerns about religious
restrictions.
A spokesman declined to
comment directly on the ban,
but referred to a Dec 27 statement in which the ministry
said the act of publicly marking
non-Islamic rituals or festivities
“can be seen as propagations
of religions other than Islam.”
It noted in particular: “For
example, in conjunction with
Christmas celebrations, Muslim
children, teenagers and adults
can be seen wearing hats or
clothes that resemble Santa
Claus. Believers of other religions who live under the rule of
an Islamic country — according
to Islam — may practise their religion or celebrate their religious
festivities among their community, with the condition that the
celebrations are not disclosed or
displayed publicly to Muslims,”
the statement said. — AFP
men and women who are close to
the suspects, without saying where
they had been detained.
Prime Minister Manuel Valls
told RTL radio that the two suspects were known to intelligence
services and were “no doubt” being followed before Wednesday’s
attack.
They have been identified as
Cherif Kouachi, 32, a known jihadist convicted in 2008 for involvement in a network sending
fighters to Iraq, and his 34-yearold brother Said. Both were born
in Paris.
The massacre triggered an outpouring of solidarity around the
world, with outraged people from
Moscow to Washington rallying in
their tens of thousands under the
banner “I am Charlie”, in support
of press freedom and the controversial Charlie Hebdo magazine.
— AFP
BEIRUT: Nusra Front Islamist
militants linked to al-Qaeda have
blown up the 13th century tomb
of a revered Islamic scholar in
southern Syria, Syrian state news
agency SANA and monitoring
group, the Syrian Observatory
for Human Rights, reported. The
mausoleum of Imam Nawawi is
in Nawa in Deraa province near
the Jordanian border, a town
captured by groups fighting the
Syrian government in November. The Nusra Front follows the
same puritanical interpretation
of Sunni Islam adopted by the
Islamic State group that has also
destroyed shrines in areas of Syria that it controls. They see tombs
as sacrilegious. — Reuters
HONG KONG: The teenage face
of Hong Kong’s pro-democracy
movement, 18-year-old Joshua
Wong, slammed the authorities
yesterday in a court appearance
linked to mass protests which
brought parts of the city to a
standstill for months. Wong was
one of 29 activists at the High
Court for a preliminary hearing
on possible criminal contempt
charges. “The government is using legal procedures to suppress
the Umbrella Movement,” Wong
said, referring to the name for
the pro-democracy campaign.
“It is wasting taxpayers’ money... to stop people from taking
future action.” Another student
leader, Lester Shum, 21, accused
the authorities of “abusing legal
proceedings”. — AFP
Australian on death row
loses final appeal
Brothers Cherif
(left) and Said.
Photo by AFP
a spate of bombings and a plane
hijacking in France in the 1990s.
Cherif was also suspected of being close to another key French jihadist, Djamel Beghal, who spent
10 years in prison for planning attacks.
His brother Said was born on Sept
7, 1980, also in Paris. His photo shows
him with brown eyes, lightly bearded
with short brown hair.
Their presumed accomplice,
who surrendered himself to police in north-eastern France was
identified as Mourad Hamyd, the
18-year-old step-brother of Cherif.
He is suspected of helping the two
brothers in the attack, with one witness saying a third man was in the
car when they made their getaway.
Mourad presented himself to police in the town of Charleville-Mezieres “after seeing his name on social networks”, a source told AFP.
Several of his school friends had
taken to Twitter saying he had been
in class with them at the time of the
attack. — AFP
Policewoman dies after shooting outside Paris
PARIS: A policewoman was killed
and a city employee were seriously hurt yesterday after a
man opened fire with an automatic rifle outside Paris, police
said, but no link has yet been
Al-Qaeda-linked militants
blow up 13th century
Muslim tomb in Syria
Hong Kong student leader
slams authorities in court
Suspects in Charlie Hebdo attack
well-known to anti-terror police
PARIS: Cherif Kouachi, the 32-yearold hunted along with his older
brother Said for the attack on satirical weekly Charlie Hebdo is a jihadist who has been well known to
anti-terror police for many years.
Cherif, who was born on Nov
28, 1982 in Paris not far from where
the attack took place, had already
been jailed in 2008 for his role in
sending fighters to Iraq.
Sometimes going by the name
of Abu Issen, he was part of the
“Buttes-Chaumont network” that
helped send would-be jihadists to
join al-Qaeda in Iraq during the
US-led invasion in the mid-2000s.
He was arrested just before he
was due to fly to Syria and on to
Iraq — and was later sentenced
to three years in prison, including
an 18-month suspended sentence.
Two years later, his name was
cited in a police report related to
the attempted prison escape of
Smain Ait Ali Belkacem, a former
member of the Algerian Armed Islamic Group (GIA) that carried out
IN BRIEF
established with Wednesday’s
deadly attack on a satirical
magazine.
The gunman is still on the
run, said Interior Minister Bernard Cazeneuve — who rushed
to the scene at Montrouge just
south of the city — contradicting information given earlier by
a source close to the case, who
said the suspect had been detained. — AFP
DENPASAR: An Australian drug
smuggler on death row in Indonesia has lost a bid for presidential clemency, his final chance to
avoid execution, a court official
said yesterday. Myuran Sukumaran was one of nine Australians
arrested in 2005 for attempting
to smuggle 8kg of heroin out of
the Indonesian resort island of
Bali. “The presidential decree
signed on Dec 30 stipulates that
the clemency of an Australian on
death row, Myuran Sukumaran,
has been rejected,” Hasoloan
Sianturi, a spokesman for the
court in Bali with jurisdiction
for the case, said. — AFP
Turkey urges remaining
citizens to leave Libya
ANKARA: Turkey urged all of
its remaining citizens to leave
Libya amid worsening security following a threat made on a
Facebook page to shoot down
Turkish aircraft. The warning,
published on the Foreign Ministry’s website on Wednesday,
came a day after Turkish Airlines
became the last foreign operator
to suspend all flights to Libya.
On Wednesday, the ministry
released a statement saying a
threat to shoot down Turkish
civilian and military aircraft had
been posted on a Facebook page
allegedly belonging to the Libyan Air Force. — Reuters
28
live it!
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
FR I
WELLBEING . THE ARTS . WINE+DINE . STYLE+DESIGN . LEISURE
Personal
ASSISTANT
COMPI L ED BY CAR M EL DOM INIC
WORK. LIFE. BALANCE
Spring Edition
THE Malaysia International Jewellery Fair
is once again set to shine from today until
Monday from 11am till 7pm at the Kuala
Lumpur Convention Centre (Hall 2). An
estimated 120 jewellery brands from over
13 countries including Italy, Japan, Hong
Kong, Sri Lanka, India, Turkey, the United
Arab Emirates, Singapore, Myanmar,
Cambodia, Indonesia, Thailand and
Malaysia will be showcasing more than
100,000 pieces of the most luxurious and
trendiest jewellery collections. For preregistration, please log on to http://www.
mijf.com.my/mijf_spring/pre-registration_
attend or contact (03) 5891 1157.
All
hea
him
for
lec
wit
Keith Michaels (Grant) striking up an unlikely friendship with his student, Holly Carpenter (Tomei). Photo by 20TH CENTURY FOX
AN event that has become the talk of
Southeast Asia, the Royal Langkawi
International Regatta will see more than 50
yachts competing in nine highly-charged
racing classes. Do not miss the drama
and excitement on the high seas. Taking
place in Langkawi, Kedah, from Jan 12 to
17, the competition has received 35 entries
from local and international yachts for
the races out of which 10 entries are from
Malaysia, seven from Great Britain, six from
Australia, three from Thailand, two each
from Singapore and New Zealand, and
one each from Austria, Denmark, China,
Hong Kong, Japan and Russia. For more
information on the Royal Langkawi Yacht
Club, visit www.langkawiregatta.com or
contact Wicky Sundram at wickysundram@
langkawiyachtclub.com.
Movie Review:
THE REWRITE
BY QUAH S U ANN
Director: Marc Lawrence
Cast: Hugh Grant, Marisa Tomei
Rating: 3.5 out of 5
Length: 106 minutes
Opening: Now showing
THE Regional Seminar on Islamic Tourism
serves as an avenue to share, discuss,
coordinate, plan and develop suitable
Islamic tour packages and tourism trails
that showcase Malaysia’s Islamic tourism
products for local and international visitors.
Besides discussing ways to make the country
a premier Islamic tourism destination,
the seminar also identifies the needs and
expectations of Muslim tourists to Malaysia.
It also discusses partnerships and alliances
between the public and private sectors. It will
take place from Jan 12 to 14 at The Pacific,
Sutera Harbour Resort, Kota Kinabalu, Sabah,
and interested participants can log on to
http://itc.gov.my/industry/initiatives/regionalseminar-on-islamic-tourism-resit/ and
download the registration form.
G
o ne are the days when
Hugh Grant would grace
the Hollywood screens as
a heartthrob, stealing the
hearts of many a woman
along the way. Today, at
age 54, Grant can no longer fit the role
of a young, suave yet funny hero, saving
damsels in distress along the way. But his
charm and good looks are still as evident
as ever in his newest role as washed out
screenwriter, Keith Michaels.
The Rewrite tells the story of Michaels,
who at the height of his career had won
a Golden Globe award for writing “Paradise Misplaced” in 1998. Fast forward
a decade and three failed movies later,
he is down and out, largely forgotten by
Hollywood and forced to accept a job
teaching screenwriting at Binghamton
University — located almost 320km away
from New York City — to pay the bills.
At the university, he finds himself
oddly misplaced among academics, all
of whom hold doctorates and specialise
in dissecting historical works such as
Shakespeare and Jane Austen. After a
skirmish with Mary Wheldon (played by
wit
stu
two
to e
mi
be
rub
bec
tale
and
qu
a te
live it! 29
F R I DAY JA N UA RY 9 , 2 015 • T HEED G E FINA NCIA L DA ILY
WELLBEING . THE ARTS . WINE+DINE . STYLE+DESIGN . LEISURE
Michaels teaching a class in Binghamton University.
Allison Janney), who also happens to be the
head of the ethics committee, Michaels finds
himself in trouble for dismissing his class
for a month after giving them a five-minute
lecture and having an intimate relationship
with one of his students.
Michaels strikes up an unlikely friendship
with Holly Carpenter (Marisa Tomei), another
student in his class — a single mother with
two daughters who has gone back to college
to earn a degree. Carpenter, an upbeat, optimistic person who believes that anything can
be accomplished if you put your heart to it
rubs off on Michaels, who over the years has
become a cynical, bitter writer who thinks that
talent is something that people are born with
and can’t be taught. This therefore calls into
question his reason for agreeing to become
a teacher in the first place.
However, during the course of the semester, Michaels finds himself blossoming
in his role, and becomes quite successful in
cultivating his students’ talents, and inspiring them to become better writers.
The Rewrite reads like a mid-life crisis of
sorts — almost everyone, at some point of
time in their lives, will find themselves down
and out of luck, having to look back and reflect on the past to remind themselves why
it is that they chose the path that they chose.
Grant’s natural comedic qualities truly
shine through in this movie.
Although several of the supporting characters do a commendable job, The Rewrite
focuses on Grant and his talent at being painfully funny in his own self-deprecating British way. If one has watched videos of Grant
at interviews and at award ceremonies (in
Michaels helping a student with his screenplay.
fact, one of the most poignant moments in
this film consists of the original footage in
which Grant accepts the Golden Globe for
Best Actor in 1995, albeit slightly edited for
the movie), one would, no doubt, be able to
spot his brand of humour.
While The Rewrite isn’t groundbreaking nor
will it become Hollywood’s next blockbuster,
it does offer some genuinely funny laughs.
The movie is written based on a very relatable
premise, but the supporting characters were
not utilised quite enough throughout the movie. There were moments when it seemed like
something great was just about scratching the
surface, but it was never explored, leaving the
movie somewhat short of inspiring.
For instance, nothing becomes of Michaels’ awkward, distant relationship with
his son, nor is the blossoming relationship
between Michaels and Carpenter really explored and delved into; which is a pity, because both were emotional, interesting and
thought-provoking.
Instead, too much screen time is devoted
to Michaels’ mistake in his fling with the student, which in the end amounts to nothing.
Janney played her part to perfection, though,
somewhat in a 360° twist from her previous
appearance as a teacher in 10 Things I Hate
About You (1999).
To sum things up, it’s nice to see Grant
playing the lead role in a romantic comedy
again after a 10-year hiatus between Bridget
Jones: The Edge of Reason and The Rewrite,
even if he does sport more creases on his face
and more than just a few white hairs on his
head. Definitely a worthy watch on a relaxing weekend, unwinding from work stress.
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30
live it!
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
WELLBEING . THE ARTS . WINE+DINE . STYLE+DESIGN . LEISURE
Zen TODAY
Love can change a person the way a parent can change a baby —
awkwardly, and often with a great deal of mess. — Lemony Snicket
LOOKING EAST
Trouble with the throne
‘The Empress of China’, which stars Fan Bingbing, runs into controversies
BY L K TA N
T
he Empress of China is making
headlines.
For one, it marks the comeback of China A-lister Fan Bingbing to the small screen after a
six-year hiatus.
Second, most of the female cast in this
imperial court drama — servants, concubines and consorts — don cleavage-baring
costumes, said to reflect the openness of
seventh- and eighth-century Tang Dynasty,
and possibly the reason behind stirred-up
discussions and boosted ratings.
And third, the show was suspended seven days after being aired on Hunan TV over
“technical glitches”.
It was revived on Jan 1 — with cleavage-exposing scenes censored, believed to be under
the directive of the Chinese authorities. Netizens quickly observed that all the characters
were “flat-chested”, and lamented that the
editing was out of proportion as most scenes
zoomed into the actresses’ faces.
Regardless of the controversies, The Empress
of China looks set to be the most viewed and
most talked about Chinese series this year.
The plot
It follows the life of Wu Zetian — the only
female empress in Chinese history — from
the beginnings of her imperial life as a
16-year-old concubine to Emperor Taizong,
through to the end of her rule.
The Empress of China boasts an A-list line-up from China, Taiwan and
Hong Kong. Pictures from Weibo.
It follows her trials of power, love and politics, her winning over of Emperor Gaozong,
and then her dominion over the throne from
the age of 66. Wu ruled during the self-proclaimed “Zhou Dynasty” from 690 to 705 and
was thought to be a strongly opinionated woman who was fierce and ruthless. She died at
the age of 82.
The series made its debut on Hunan TV on
Dec 21 last year, and it was the highest rated
premiere of a drama in China.
There is little doubt about its success as
The Empress of China follows in the footsteps
of previous Chinese historical dramas which
detail the infighting among emperors’ siblings
and concubines.
It was reported that the production investment for the 85-parter was a sky-high 300
million yuan (RM172 million). Hong Kong’s
TVB snapped up the broadcasting rights at a
Fan plays Wu Zetian — first as a 16-year-old concubine, then an 82-year-old
empress.
hefty price, to air the drama over prime-time mei, 48, is a familiar face, having starred in
many hit TVB dramas in the 1990s. The forslots in February.
mer Miss Hong Kong pageant participant,
The cast
who is divorced from veteran actor Ray Lui
Heading a string of gorgeous and popular Leung-wai and was romantically linked to
actresses, Fan, 33, takes the limelight. The first Canto-pop king Leon Lai, left for China in
Asian to appear in the X-Men franchise — in the early 2000s to develop her career in the
X-Men: Days of Future Past — she doubles mainland. Chow plays one of the consorts
as the central character and the producer and was not coy about showing off her hourfor The Empress of China.
glass figure in the series.
Having invested eight months in the proTaiwanese actress Chang Ting, 44, on the
ject, Fan says: “This is a dream role for every other hand, is the only “modest” supportactress, and regardless of how much time it ing actress whose costumes stayed above
might have taken, it was worth the effort.”
her bosom. She started out by acting in TaiThe Qingdao-born beauty was No 1 in the wanese television commercials at just 19,
2014 Forbes China Celebrity 100 list, raking and her dimpled sweet looks put her firmly
in an annual income of 122 million yuan. She ahead in the Taiwan TV industry until she
beat Hong Kong’s Andy Lau and Taiwanese faded out on venturing into the real estate
Mando-pop singer Jay Chou.
business in China with ex-actor husband
Hong Kong actress Kathy Chow Hoi- Lin Rui-yang.
S P O RT S 3 1
F R I DAY JA N UA RY 9 , 2015 • T HEED G E FINA NCIA L DA ILY
Bangladesh cricketer
remanded in rape case
19-year-old actress Naznin claims they had an intimate affair
DHAKA: Bangladesh cricketer Rubel Hossain, who has been
named in the country’s World Cup
squad, was behind bars yesterday
after being remanded in custody
over allegations that he raped an
actress.
A magistrate in the capital Dhaka
delivered the order after 19-yearold Naznin Akter Happy lodged a
complaint of “rape” and a “false
promise of marriage” against the
cricketer last month.
The court’s decision puts a
huge question mark over the
24-year-old’s appearance in next
month’s World Cup in Australia
and New Zealand after selectors
picked him in the 15-man squad
last weekend.
“The metropolitan magistrate
court rejected his bail plea ... He
was sent to prison pending the next
hearing of the case,” deputy commissioner of Dhaka police Anisur
Rahman told AFP.
No date has been set for the next
hearing.
Police last month launched a
probe after Happy lodged a complaint with police that the fast bowler had backed away from an earlier
Halep, Kvitova
swing into
Shenzhen semis
BEIJING: Top seed and world
No 3 Simona Halep, along with
second seed Petra Kvitova,
ranked four, both breezed past
lowly opponents in straight
sets yestersday to reach the
semi-finals of the WTA Shenzhen Open.
Romanian Halep, last year’s
French Open runner-up, made
short work of Serbian qualifier
Aleksandra Krunic, winning
through 6-3, 6-3 in 62 minutes.
Double Wimbledon winner
Kvitova needed slightly longer
to dispose of her fellow Czech
Tereza Smitkova but did so 7-5,
6-4. She will play Swiss eighth
seed Timea Bacsinszky in the
semi-finals, after former world
No 2 Vera Zvonareva’s injury
devils returned to haunt her
and she retired in tears just
29 minutes into her first WTA
quarter-final since 2012.
The Russian reached the
Wimbledon and US Open finals in 2010 but has since
been plagued by injury and
illness, dropping to 250 in the
world, and was attempting to
launch a 2015 comeback at the
US$500,000 (RM1.78 million)
tournament.— AFP
Filepic of Rubel Hossain celebrating during the first one-day international cricket
match aainst New Zealand in Dhaka on Oct 29, 2013. A young actress has accused him
of rape and a false promise of marriage. Photo by Reuters
pledge to marry her after having a
months-long “intimate affair”.
After hearing the complaint,
a court ordered medical tests on
Happy and both the alleged victim
and Hossain to undergo DNA tests.
The scandal has gripped the con-
servative Muslim-majority country
for weeks, with Happy telling reporters that she would be prepared
to withdraw the case if Rubel agrees
to marry her.
Although victims of alleged
rapes are usually entitled to an-
onymity, Happy’s decision to go
public prompted police to waive
the usual restrictions.
Under Bangladeshi law, anyone
who makes what is considered a
“false” marriage proposal is liable
to criminal prosecution.
The fast bowler has rejected the
accusations of rape or making a
marriage proposal, saying Happy
was trying to “blackmail” him. He
also ruled out marrying the actress.
Happy became a household
name for her debut movie Kichu
Asha Bhalobasa (Some Hopes, Some
Loves) which hit the cinemas in
September 2013.
After filing the complaint, Happy
told private Channel-71 that they
“had a relationship like any other
couple” but that “recently, he was
finding excuses not to marry me”.
“It’s an act of cheating and I want
him to be punished,” she said without elaborating on the rape allegation.
Rubel has played 22 Tests for
Bangladesh and taken 32 wickets.
He has also taken 69 wickets in
53 one-day international matches
including a hat-trick against New
Zealand. — AFP
Spidercam caught in web
of controversy
SYDNEY: Television’s “spidercam”
found itself at the centre of controversy over a dropped Australian
catch on the third day of the final
Test against India yesterday.
Australia skipper Steve Smith
put down a skied chance off Lokesh
Rahul on 46 before lunch, and then
appeared to blame spidercam for
missing the catch.
Smith was seen mouthing “[expletive] wire” to teammates after
his line of sight was affected by the
cables connecting the aerial TV
camera.
Cricket Australia and the Nine
Network later confirmed that Smith
had been “distracted by one of the
wires in his eyeline”.
“We [CA and Nine] have spoken
about the matter involving spidercam and the dropped catch before
lunch and it’s clear the ball did not
hit the camera or its supporting
wires,” the joint statement read.
“Captain Steve Smith was distracted by one of the wires in his
eyeline. Both CA and Nine will continue to work together on the use of
spidercam in the broadcast coverage
and will take on board any player
feedback as necessary.
“As it stands, if any player has
a concern about the placement of
spidercam they can ask the umpires
for it to be moved.”
Australia coach Darren Lehmann
said while he is a fan of spidercam,
he thinks its positioning during
games needs to be thought out. “It
wasn’t ideal where it was positioned
for that particular ball,” he said. “I
like watching it, but I think they have
to get the position right when the
bowler’s bowling, particularly on
the off-side which we are speaking to
Channel Nine about it, making sure
we get that right moving forward.
“It was just the wire moving as the
ball was coming down,” Lehmann
said of Smith’s split catch.— AFP
Wozniacki, Williams continue Auckland charge
AUCKLAND: Former World No 1s
Caroline Wozniacki and Venus Williams overcame spirited opposition
yesterday to reach the semi-finals of
the Auckland Classic.
Wozniacki, the tournament top
seed, produced fighting qualities
to overcome big-serving German
Julia Goerges 6-4, 6-4 and set up a
final four clash with Czech Barbora
Zahlavova Strycova.
Third seed Williams had to come
from 2-4 down in the second set to
beat Russian Elena Vesnina 6-2,
6-4 and will play fellow American
Lauren Davis in the semis.
Wozniacki dropped her serve
once and broke back twice in a tense
first set against Goerges who saved
five of the seven break points she
faced.
The German kept up the pressure in the second round and after
breaking Wozniacki a second time,
the Dane showed her anger with
herself as she swatted a ball away.
After she broke back, Wozniacki
later slammed her racquet on the
ground when losing game point
at 4-3 and 40-15 before regaining
her composure for the remainder
of the match.
Williams cruised through the first
set against Vesnina but was made
to fight when the Russian broke her
early in the second.— AFP
IN BRIEF
Kimetto and Kipsang to
race London Marathon
LONDON: Dennis Kimetto,
who smashed the world record last year, and fellow Kenyan and defending champion
Wilson Kipsang, whose mark he
beat, will go head-to-head for
the first time in a mouth-watering London Marathon on
April 26, organisers said yesterday. Kimetto, who clocked
two hours, two minutes, 57 seconds in last September’s Berlin
Marathon to take 26 seconds off
Kipsang’s 2013 record, will be
making his London Marathon
debut, while Kipsang is seeking a third title after winning
in 2012 and 2014. The two are
training partners in the Kenyan town of Iten but have never faced each other over the
marathon distance. — Reuters
Elliott recalled to New
Zealand World Cup squad
WELLINGTON: All-rounder
Grant Elliott has been recalled
to the New Zealand one-day
side after 14 months in the wilderness to be the surprise in
their cricket World Cup squad
named yesterday. His inclusion
comes at the expense of Jimmy
Neesham who performed creditably in the Test series against
Sri Lanka won by New Zealand 2-0 on Wednesday. Rising
speedster Adam Milne won the
fifth paceman’s slot over Matt
Henry in an otherwise predictable line-up which features
veteran spinner Daniel Vettori, selected for his fifth World
Cup, and seven members of the
successful Test squad. — AFP
Al-Attiyah, Barreda extend Dakar lead in desert
COPIAPO, Chile: Former champion Nasser Al-Attiyah mounted a late charge to extend his
Dakar Rally lead on Wednesday as the gruelling 9,000km
event climbed the Andes and
then crossed Chile’s Atacama
desert. Qatari driver Al-Attiyah,
the 2011 champion, finished
two minutes 40 seconds ahead
of Mini team-mate Nani Roma,
the defending champion, whose
hopes had disappeared on a disastrous opening stage on Sunday when he lost eight hours.
In third place on Wednesday’s
fourth stage was South Africa’s
2009 champion Giniel De Villiers behind the wheel of a Toyota. — AFP
Rahul ‘relieved’ to score
first Test ton
SYDNEY: Rising India star
Lokesh Rahul said he was more
relieved than proud of scoring his maiden century in just
his second Test match against
Australia in Sydney yesterday.
The 22-year-old right-hander
from Bangalore rode his luck
on his way to 110 in India’s 342
for five in reply to Australia’s
572 for seven declared at third
day stumps in the fourth and
final Test. He shared in a 141run stand for the third wicket
with skipper Virat Kohli, who
compiled his fourth ton of the
series. — AFP
3 2 S P O RT S
FR I DAY JAN UARY 9, 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY
In-form Atletico seek to
pile pressure on Barca
Barcelona is reeling from rift between coach and star striker Messi
BY TI M HA NLON
BARCELONA: In-form Atletico Madrid will aim to pile pressure on a
Barcelona side reeling from a rift
between coach Luis Enrique and
star player Lionel Messi in a crunch
La Liga clash this Sunday.
It was an all-or-nothing match
last time the two sides met at the
Camp Nou in the final game of last
season with a draw giving the visitors the title.
Now while the stakes are not as
high, a negative result could have
a major impact on the future of
Luis Enrique.
It is a perfect time for Diego Simeone’s Atletico side to face Barca who
have failed to convince this season
and are embroiled in a supposed rift
between Luis Enrique and Messi.
The pair are believed to have almost come to blows during a training session last Friday and then had
a heated argument after Sunday’s
La Liga defeat by Real Sociedad.
That result left champions At-
Miss semis and
we’ve failed,
S Korea’s Lee
CANBERRA: Former Tottenham Hotspur and PSV Eindhoven star Lee Young-Pyo
yesterday told AFP that South
Korea’s Asian Cup would be
considered a “failure” if they
don’t reach the semi-finals.
The retired full back, who
is one of South Korea’s most
capped players of all time, said
the squad are under pressure to
perform after a disappointing
World Cup in Brazil last summer.
“We have to get to the
semi-final,” said Lee, who also
played for Borussia Dortmund
in a glittering career which saw
him make 127 appearances for
his country.
“[South] Korea are one of the
best teams in Asia,” the 37-yearold added. “We have enough
ability to reach the semi-finals.
After the semi-finals nobody
knows what is going to happen.
If we don’t get to the semi-finals
then we would have definitely
failed,” said Lee, who is commentating for Korean TV.
Angry fans hurled toffees
at South Korea’s players when
the 2002 World Cup semi-finalists returned winless from last
year’s edition in Brazil. “Go eat
a toffee!” is a sexually charged
Korean insult.
“I think the players are under a bit of pressure because
the World Cup wasn’t good,”
said Lee. — AFP
Messi (left) and Enrique are believed to have almost come to blows during training last
Friday. Photo by AFP
letico level with Barcelona on 38
points, one less than leaders Real
Madrid who also have a game in
hand of their two title rivals.
While Barcelona have hit the
headlines for the wrong reasons,
Simeone has gone about the business of adapting new players to his
system with quiet efficiency.
In the wake of the departure of key
players such as striker Diego Costa,
they started the season slowly but
have picked up the pace and began
the New Year with a victory over Levante in La Liga followed by a win
against Real Madrid in the first leg
of their King’s Cup last 16 tie.
“I don’t understand this game
without the word competition,”
Simeone said. “In order to com-
pete against opposition you need
to compete together. The team is
working very hard.
“In order to have success in three
competitions you need to have a
group. The team is competitive and
we will take on the opposition in
whichever competition.”
Returning hero Fernando Torres has been the centre of attention
since arriving back at the Calderon
in the January transfer window but
he had a quiet game against Real.
Simeone urged patience with
the Spain striker, who left Atletico
for Liverpool and then moved to
Chelsea and Milan.
“He offers drive and energy,”
said Simeone. “He is strong and
fast but needs more time to create
an understanding with his teammates.”
Real Madrid finished 2014 with a
Spanish record 22 consecutive victories but after a La Liga defeat by
Valencia and the loss to Atletico, they
will need to get back on track against
Espanyol on Saturday. — Reuters
No crisis, but Ancelotti
concerned by passive Real
BY KIER AN C ANNI NG
MADRID: Real Madrid coach Carlo
Ancelotti believed his side lacked
penetration as they left themselves
with a mountain to climb if they are
to progress to the quarter-finals of
the Copa del Rey after a 2-0 defeat
to Atletico Madrid.
Ancelotti’s men have now suffered back-to-back defeats after a
run of 22 consecutive wins to end
2014 and three of their five losses this
season have come at the hands of
the Spanish champions. Both sides
meet again for the second leg at the
Santiago Bernabeu on Jan 15.
“I think to call it a crisis is a bit
exaggerated,” he said. “We controlled the game well until the pen-
alty and then we didn’t play well in
the final part of the game. We needed a bit more efficiency in the final
pass in the first-half. We played a
lot of square balls, but Atletico also
defended well. They always defend
together and compact so it is difficult to find a solution.”
Ancelotti had left Cristiano Ronaldo on the bench, but otherwise
named a strong side including Gareth Bale, James Rodriguez and
Karim Benzema.
Cristiano was summoned after
Raul Garcia had put Atletico in front
from the penalty spot just before the
hour mark, but made little impact
as the hosts went onto double their
lead through Jose Gimenez’s powerful header 13 minutes from time.
“Ronaldo was a bit tired, so it
was a risk to play him for the full
90 minutes,” Ancelotti explained.
“We have a chance. It is clear
that Atletico have the advantage,
but at home anything can happen.
The odds aren’t in our favour but
we will try our best.”
Fernando Torres’s return to Atletico ensured there was a buoyant
atmosphere at the Vicente Calderon
throughout. And he was delighted
to register his first win over Real
as an Atletico player despite a far
from perfect performance which
saw him replaced after an hour.
“I am happy for many reasons.
“For the result, the atmosphere
we experienced, the fans, for
everything,” he said.— AFP
Aussies launch bid to dethrone Japan
MELBOURNE: Australia will launch
their attempt to reach new heights
in football by toppling champions
Japan and winning their first Asian
Cup when they kick off the tournament today.
A sell-out crowd is expected at
the 30,000-capacity Melbourne Rectangular Stadium as Ange Postecoglou’s men take on Kuwait on day
one of the 16-nation extravaganza.
An eventual victory for Australia would put the country on top at
both club and international level
after Western Sydney Wanderers
won the AFC Champions League
in November. And it would provide
a further boost for football among
the Australian public.
Four-time winners Japan are
one of their main rivals, despite a
match-fixing case swirling around
their coach, and Carlos Queiroz’s
Iran also look like top contenders.
South Korea are looking to end a
55-year title drought, but the draw
has been unkind to 2011 semi-finalists Uzbekistan who are likely
to face the Koreans or Australia if
they reach the quarter-finals.
Among the minnows, Palestine
have overcome major hurdles to
qualify for the first time, and North
Korea are trying to escape the group
stage for the first time since 1980.
Australia joined the Asian Football Confederation in 2006 but have
yet to lift the region’s most coveted
trophy. — AFP
IN BRIEF
Sarver makes increased
bid for Rangers
GLASGOW: The owner of the
Phoenix Suns basketball side,
Robert Sarver, has increased his
takeover bid for Rangers Football
Club to £20 million (RM107.92
million) emergency loan to help
keep it in business. The US businessman had an £18m offer rejected on Tuesday despite the
Ibrox board facing a cash crisis.
But Sarver is now sweetening his
offer by saying he is willing to
provide money to pay off loans
already taken out in recent weeks
if the club accepts his new revised bid. He further indicated
he would be willing to continue
working with former director
Dave King and wealthy businessmen fans Douglas Park, George
Letham and George Taylor who
have both bought significant
stakes in the past week. — AFP
Football grounds to honour
attack victims
PARIS: A minute’s silence will
be observed at football grounds
throughout France this weekend as a mark of respect for the
12 people killed in the terrorist
attack on the Charlie Hebdo satirical newspaper, the French
Football Federation (FFF) announced yesterday. “Following
the terrible attack at the headquarters of Charlie Hebdo, the
French Football Federation has
decided to observe a minute’s
silence in all fields of the Hexagon [France] this weekend, at
national and regional matches,”
the FFF said in a statement.
“The entire family of French
football joins the general spirit of solidarity and affirms its
support for the families of the
victims.” — AFP
Marseille aim to bounce
back from Cup humiliation
PARIS: Marseille will look to
put the disappointment of their
shock French Cup exit behind
them and extend their lead at
the top of the Ligue 1 table
when they go to Montpellier
today. Marcelo Bielsa’s side endured a disastrous start to 2015,
losing on penalties to fourthtier Grenoble in the last-64 of
the French Cup after throwing
away the lead three times. It
was bitterly disappointing for
Bielsa, who took Athletic Bilbao to the Copa del Rey final in
2012 in his first season in Spain,
and the Argentine accepted
the blame for the exit. — AFP
Iran’s Beikzadeh out
with broken hand
SYDNEY: Three-time winners
Iran suffered a blow on the
eve of the Asian Cup when defender Hashem Beikzadeh was
ruled out with a broken hand.
Coach Carlos Queiroz said the
loss of the 30-year-old, who sustained the injury in training on
Wednesday, had caused “big
damage” to Iran’s plans. The full
back, who can also play in central defence, will be replaced by
Mohammad Reza Khanzadeh,
23, who arrives today ahead of
Iran’s opener against Bahrain
on Sunday. — AFP