by u o y o t t h g u o r b s i y p o c l a t This digi FBM KLCI 1844.31 5.08 KLCI FUTURES 1838.00 6.00 STI 3472.38 12.08 RM/USD 3.6655 CPO RM2127.00 8.00 OIL US$57.87 1.30 GOLD US$1204.40 PP 9974/08/2013 (032820) PENINSULAR MALAYSIA RM1.60 (INCLUSIVE OF 6% GST) MONDAY APRIL 13, 2015 ISSUE 1938/2015 FINANCIAL DAILY MAKE BETTER DECISIONS www.theedgemarkets.com 6 HOME BUSINESS HK investors propose RM142b concrete deck island for Penang 7 HOME BUSINESS Six Flags keen on Malaysian entry 8 HOME BUSINESS Hovid eyes to market first Malaysian drug globally 18 F O C U S New Oysterflex bracelet reimagines the rubber strap 23 W O R L D B U S I N E S S Commodity giants’ S’pore trading hubs under fire Dr M: Set up independent panel for 1MDB probe 14 H O M E 10.90 2 M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY For breaking news updates go to www.theedgemarkets.com ON EDGE T V www.theedgemarkets.com EPF in talks to divest UK property assets Expensive homes call for smaller public housing units ECB likely to continue bond buying Chief Draghi expected to give ‘short shrift’ — analysts FRANKFURT: The European Central Bank’s (ECB) decision makers will meet on Wednesday, buoyed by the successful debut of a mass bond-buying spree designed to kick-start growth and will likely quash talks of it wrapping up early. Analysts said ECB chief Mario Draghi is expected to give short shrift to any suggestion of a premature end to the quantitative easing (QE) programme, the long-awaited and controversial gambit launched by the central bank last month. Amid ongoing uncertainty about cash-strapped Greece, the first volley of the ECB’s US$1.2 trillion (RM4.39 trillion) scheme offered some good news, getting off to a solid start by meeting its target. That has fed speculation that the anti-deflationary policy of buying around €60 billion (RM232.74 billion) of public and private bonds each month could be stopped before its planned September 2016 end date. But Royal Bank of Scotland economist Richard Barwell said he doubted Draghi will follow such a course as confidence in the ECB’s future actions is so crucial to the current markets. “Therefore, we should expect the driver’s determination to complete the journey to be a central theme in the ECB’s communica- tion strategy,” he said, ahead of the regular policy-setting governing council’s meeting in Frankfurt this week. Launched on March 9, the strategy behind the ECB’s QE programme is akin to those of the US Federal Reserve and the Bank of England to pump money into the eurozone, with massive purchases of debt to bring down borrowing costs and in turn foster easier credit. “A success,” remarked Berenberg Bank economist Christian Schulz after nearly €61 billion in government and corporate debt was purchased in the first round, despite fears of a possible shortage of assets to buy. — AFP The Edge Communications Sdn Bhd (266980-X) Level 3, Menara KLK, No 1 Jalan PJU 7/6, Mutiara Damansara, 47810 Petaling Jaya, Selangor, Malaysia Publisher and Group CEO Ho Kay Tat Editorial For News Tips/Press Releases Tel: 03-7721 8219 Fax: 03-7721 8038 Email: [email protected] Senior Managing Editor Azam Aris Executive Editors Kathy Fong, Jenny Ng, Siow Chen Ming, Surinder Jessy, Ooi Inn Leong Associate Editors R B Bhattacharjee, Joyce Goh, Jose Barrock, Vasantha Ganesan Deputy Editors Cindy Yeap, Kang Siew Li Assistant Editors Adeline Paul Raj, Tan Choe Choe Chief Copy Editor Halim Yaacob Senior Copy Editors Marica Van Wynen, Lam Seng Fatt, Melanie Proctor Copy Editor Evelyn Chan Art Director Sharon Khoh Design Team Cheryl Loh, Valerie Chin, Aaron Boudville, Aminullah Abdul Karim, Yong Yik Sheng, Tun Mohd Zafian Mohd Za’abah Asst Manager-Editorial Services Madeline Tan Corporate Managing Director Au Foong Yee Deputy Managing Director Lim Shiew Yuin Advertising & Marketing To advertise contact GL: (03) 7721 8000 Fax: (03) 7721 8288 Chief Marketing Officer Sharon Teh (012) 313 9056 General Manager, Digital Media Kingston Low (012) 278 5540 Senior Sales Managers Geetha Perumal (016) 250 8640 Fong Lai Kuan (012) 386 2831 Shereen Wong (016) 233 7388 Peter Hoe (019) 221 5351 Acting Senior Sales Manager Gregory Thu (012) 376 0614 Ad-Traffic Manager Vigneswary Krishnan (03) 7721 8005 Ad Traffic Asst Manager Roger Lee (03) 7721 8004 Executive Ad-Traffic Norma Jasma (03) 7721 8006 Email: [email protected] Operations To order copy Tel: 03-7721 8034 / 8033 Fax: 03-7721 8282 Email: [email protected] Private capital forsakes Asia BY ANDY M U K HE RJ E E SINGAPORE: Private capital looks to have fled Asia to the tune of US$160 billion (RM585.6 billion) in 2014, leaving the region’s central banks scrambling for dollars to add to their reserves. Those economies doing most to reform, like India and Indonesia, seem the best at keeping investors keen. In 2014, the 10 large Asian economies outside Japan earned a combined surplus of US$413 billion from trade, their biggest in five years. Normally, when money comes in, central banks add to their stockpiles of hard-currency assets to prevent exchange rates from rising too fast. Last year, though, they hardly had to lift a finger. At US$47 billion, reserve accumulation was the weakest since the 1997 Asian crisis. Where did the rest go? Currency moves will have wiped away some of it. It is said Asian central banks follow the global trend of having three-fifths of their reserves denominated in US dollars, a quarter in euros and 8% split between the yen BY C H R IS T IN E L IM KUALA LUMPUR: Standard Chartered Bank Malaysia sees strong growth and demand for wealth management products and services in Malaysia. Managing director and chief executive officer Mahendra Gursahani said the country is the second largest wealth management market for Standard Chartered in Asean. “Our network advantage puts us in a strong position to facilitate trade and investment in Malaysia with our presence in all 10 Asean countries,” he told Bernama in an interview recently. He said Standard Chartered’s footprint markets, comprising Asia, Africa and the Middle East, are expected to account for 60% of the global growth in high net worth individuals’(HNWI) personal financial assets over the next three years. It was reported that rising wealth in Asia has spurred Standard Chartered to focus on the growth in wealth management, targeting HNWI for the banking group’s business division in China. Mahendra said the bank is investing in better technology and standardising platforms across networks in order to improve client experience through easy and convenient banking. — Bernama Bank Negara: 99% have access to banking services and the pound. A stronger doller would have erased US$205 billion of the region’s overall reserves. But even after accounting for that, there is still US$161 billion of the trade surplus unaccounted for. The simple explanation is that the private sector has taken the money elsewhere, and there is one likely culprit: Asia’s fading gross domestic product (GDP) growth. China, which is courting a GDP increase of just 7% this year, the lowest since 1990, accounted for a third of the estimated outflows. South Korea and Singapore are being hit by anaemic world trade. Elsewhere, Asia’s chronic weak governance is worsening. Thailand and Malaysia wed shaky leadership with high household debt. — Reuters Thai police detain man after Samui car bomb BANGKOK: Thai police have detained a man suspected of involvement in a car bomb on the resort island of Samui that wounded seven people, authorities said yesterday. Military officers detained the man for questioning late Saturday in Nonthaburi Province, on the northern outskirts of Bangkok, in connection to the explosion, national police spokesman Prawut Thavornsiri told AFP. “Authorities have brought in a Stan Chart sees strong growth in wealth management man for questioning after finding a threatening post on his Facebook page,” Prawut said, adding the post appeared last Friday before the blast. “As far as I know, he is still in military detention for further investigation,” he said. Security in the tourist hub has been tightened since the car bomb in a mall parking lot went off last Friday, injuring six Thais and a 12-year-old Italian girl. Extra police officers have since been deployed as Thailand enters the busy Songkran new year holiday period, Prawut said. “We have sent more police to check the airport and ferry port,” he added. The blast came a week after Thailand’s junta, which seized power last May, replaced martial law with sweeping security powers retaining the military’s control, including the right to arrest and detain people for crimes such as breaching national security. — AFP SEMPORNA: Ninety-nine per cent of Malaysians have access to banking services at bank branches or through banking agents, says Bank Negara Malaysia. Its Director of Development Finance and Enterprise Marina Kahar said the central bank introduced the banking agent initiative in 2012 under the 2011-2020 Financial Sector Masterplan. She said nationwide, 96% of mukims with a population exceeding 2,000 now have access to basic banking services compared to just 46% in 2011. Banking agents nationwide perform 34 million transactions worth RM3.5 billion, she said at the presentation of AgroAgent appointment certificates and the opening of AgroBank’s Semporna branch by Agriculture and Agro-based Industry Minister Datuk Seri Ismail Sabri Yaakob here yesterday. AgroAgents may be based at post offices, petrol stations, chain stores or sole proprietorships, and offer rural residents basic services such as cash deposits and withdrawals, she said. Banking transactions may also be made at offices of area farmers’ organisations and fishermens’ associations or the nearest Agrobazaar, and are safe, fast and easy, she added. — Bernama 4 HOME BUSINESS M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY Ewein eyes next Tanjong Pinang project Company has high hopes of being chosen because of its current relationship with CZBUCG BY KA NG SI EW L I & CHESTER TAY KUALA LUMPUR: Ewein Bhd, which is developing its first property project valued at RM800 million at Bandar Tanjong Pinang, Penang in a joint venture (JV) with Consortium Zenith BUCG Sdn Bhd (CZBUCG), is looking to bag the next parcel of land the latter will be offering for development there. It expects the next project to be up for grabs in the second half of this year. “We are now working closely with CZBUCG to explore the potential [development] of the next parcel of land measuring 4.29 acres (1.73ha). It will also require the approval of the Penang Island City Council on the planning permission for the proposed development,” Ewein managing director Datuk Ewe Swee Kheng told The Edge Financial Daily in an interview last week. He declined to reveal the details, but that it is likely to be another high-rise residential development. It is understood that the second project will have a gross development value (GDV) of RM1 billion. On March 31, 2015, Ewein (fundamental: 1.1; valuation: 1.4), through Ewein Zenith Sdn Bhd, a 60:40 JV between Ewein and CZBUCG, received planning permission from the Penang Island City Council to develop luxury serviced apartments on a 3.67-acre piece of freehold land in Bandar Tanjong Pinang. Dubbed “City of Dreams”, the project features two blocks of 38-storey towers housing a total of 572 units, with built-ups ranging from 1,100 sq ft to 2,350 sq ft. Ewe said the sea-fronting serviced apartments will be priced from RM1,200 per sq ft, which is relatively lower than Eastern & Oriental Bhd’s high-end condominiums at Seri Tanjung Pinang nearby which are going for RM1,800 per sq ft. Ewe pointed out that while Ewein Zenith was chosen to develop the City of Dreams project, it is not guaranteed that it will be the chosen developer to undertake the remaining parcels of land in Bandar Tanjong Pinang. “Of course, we (Ewein) have high hopes of being chosen because of our current relationship with CZBUCG. That’s why we must ensure that our first project (City of Dreams) is successful. If we do the project well, there is no reason why the relationship cannot continue,” he said. CZBUCG executive vice-chairman Datuk Lee Chee Hoe con- Ewe said the group expects “exciting times” in FY16 as earnings contribution from its property development starts rolling in. curred, saying Ewein Zenith can then focus on property development while CZBUCG will focus on construction projects. Bandar Tanjong Pinang entails 110 acres of reclaimed land in Tanjung Pinang that was given to CZBUCG by the Penang state government as compensation-in-kind for the building of the RM6.3 billion Penang Undersea Tunnel, which includes three road bypasses. Lee said Bandar Tanjong Pinang is estimated to have a GDV of RM25 billion over the next 10 years. According to Ewe, Bandar Tanjong Pinang will comprise a combination of residential and commercial properties, but the proportion will depend on prevailing property market conditions. “We have a masterplan [for Bandar Tanjong Pinang], but it is subject to change according to market conditions,” he added. Ewein, which is diversifying its revenue stream from manufacturing of precision sheet metal fabricated parts to include property development, expects moderate growth for the current financial year ending Dec 31, 2015 (FY15) as the sluggish demand from the electronics and electrical sector continues. The group saw net profit for FY14 grow 110.3% to RM3.46 million from RM1.65 million in FY13 on higher contribution from its investment holding activities. However, revenue fell 14.2% to RM44.63 million from RM51.99 million due to a slowdown in orders caused by lower demand for home appliances electronics. Ewe said the group expects “exciting times” come FY16 as earnings contribution from its property development starts rolling in. Ewein Zenith will launch the City Of Dreams project in the middle of this year, with construction work to begin in the second half and completion within 48 months. “We expect revenue contribution from the property development segment to outpace all other segments from FY16,” said Ewe. He sees Ewein Zenith reaping RM200 million in gross profit from the City Of Dreams project over four years starting from 2016. “The land cost [for the 3.67-acre parcel] was RM133 million, while the total development cost is estimated to be more than RM400 million,” he said. Ewe is a substantial shareholder of Ewein, with a 43.05% stake. Ewein shares closed unchanged at 60 sen last Friday, giving it a market capitalisation of RM126.56 million. The Edge Research’s fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations. Go to www.theedgemarkets.com for more details on a company’s financial dashboard. ABN loan was subject of debate in Dewan Rakyat two years ago BY T E R E N C E F E R N A N D E Z KUALA LUMPUR: The RM450 million loan from Bank Pembangunan to Asian Broadcasting Network (M) Sdn Bhd (ABN) was the subject of heated debate in Parliament two years ago. Deputy Finance Minister Datuk Ahmad Maslan outlined the loan agreement following repeated questioning by Pakatan Rakyat MPs led by opposition leader and Permatang Pauh MP Datuk Seri Anwar Ibrahim and Pandan MP Rafizi Ramli. Responding during question time on July 16, 2013, Ahmad Maslan said the loan is for seven years at an interest rate of 7.8% per annum. According to the Hansard, the loan totalled RM450 million with the equity portion being RM192 million. Cost of the project was RM642 million while the debt to equity ratio was 70:30. “At that time only RM50 million was withdrawn; to withdraw another RM150 million, ABN has to complete cable networks of 855,000 homes,” he explained to the MPs who questioned the loan, which included Barisan Nasional’s Kinabatangan rep Datuk Bung Mokhtar Radin. The drawdown of the full loan will only be allowed once 1,575,000 houses are wired. ABN which was launched in mid2013 has around 50,000 subscribers. He said the loan was approved by the group credit committee on May 18, 2012 based on three criteria: intense credit and technical analysis by consultants Frost & Sullivan; the appointment of an independent checking engineer to verify the project costs and a RM1 billion collateral by ABN’s largest shareholder Tan Sri KK Eswaran. Ahmad Maslan said the assets were “cash in hand, cash in the bank, quoted and unquoted shares, landed properties and other properties.” The Edge Financial Daily on April 7 reported that ABN was facing financial problems which caused it to close its news division and studio division, taking ABN News off the air and its accompanying news portals offline. Over 60 staff were also retrenched. Hansard records, meanwhile, show that on July 11 and 13 Finance Minister II Datuk Seri Ahmad Husni Hanadzlah was grilled over the merits of the loan, raising fears that if the venture fails, people’s money would be at risk. “Funding another cable television project is not an infrastructure project ... it is a commercial project,” said Rafizi on July 11, adding that as a commercial project, ABN should have the competitive edge to get a loan from a commercial bank. Anwar questioned the special treatment accorded to KK Eswaran as he was awarded a cable TV licence followed by a loan from a bank that is guaranteed by the government. “This while thousands of bumiputera entrepreneurs cannot even approach Bank Pembangunan,” he said. Ahmad Husni reasoned that Bank Pembangunan had studied the business plan where the limit for loans to commercial entities is RM500 million and government agencies RM1.77 billion. He said the bank’s credit committee appointed Frost & Sullivan to conduct a credit and technical analysis of the business plan. “The consultants also appointed an independent engineer; so procedures had been followed,” Ahmad Husni said, refuting allegations that the bank was forced to approve the loan following “instructions from the top”. ABN assures partners it has never defaulted on its debt servicing BY T E R E N C E F E R N A N D E Z KUALA LUMPUR: In a letter to its business partners and associates, the company addresses “recent media reports alleging that ABN is unable to service its bank borrowings and is in financial trouble”. President and chief executive officer Sreedhar Subramaniam said in the letter that the company has only drawn down half the amount, which worked out to RM225 million. (The Companies Commission of Malaysia records list the loan status as “fully released”.) “ABN has never defaulted on its debt servicing,” said Sreedhar in the letter which The Edge Financial Daily was able to get a copy of. But he then went on to say: “While there may be payment processing delays, we have always endeavoured to keep up to date for most of our essential expenses, including salaries. “Any suggestion that ABN has incurred severe losses and will not be able to meet its financial obligations is completely untrue. “The terms of the drawdown are being worked out and ABN stays committed to complete the project and honour its obligations to all its business partners,” the letter went. With regard to the shutting down of its news division, Sreedhar said the decision was purely commercial and “reflects ABN’s prerogative to make business decisions to meet its stakeholders’ objectives”. In assuring its associates and partners not to be “anxious” about the reports, Sreedhar went on to say that the article contained misleading statements and inaccuracies and that the company will be taking legal action. 6 HOME BUSINESS M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY HK investors propose concrete deck island To avoid environmental impact from Middlebank reclamation for PTMP BY SA NGEETHA AM ARTHALINGAM KUALA LUMPUR: Two Hong Kong investors have proposed to the Penang state government to build a concrete deck island measuring 2,500ha instead of reclaiming the Middlebank in a land swap deal for the RM27 billion Penang Transport Master Plan (PTMP). State Local Government, Traffic Management and Flood Mitigation committee chairman Chow Kon Yeow told the media last month that the 15-year PTMP would be funded via a land swap deal. The land swap business model, involving the 607ha Middlebank land, is similar to the funding agreement with Consortium Zenith BUCG Sdn Bhd which received 110 acres (44.51ha) of land after being tasked to build the RM6.3 billion Penang Undersea Tunnel. Requesting anonymity, the source told The Edge Financial Daily that the foreign investors have offered a private financing initiative solution to the PTMP by building a concrete island platform dubbed Menapolis (elevated water city) instead of reclaiming Middlebank to resolve fears of environmental impact. It is believed that the 15-year five-phased Menapolis project that could house a population of 250,000 by 2030, is expected to feature electronic, electrical, industrial, commercial, residential and hospitality developments. It would also incorporate green energy technology, health services, government offices, recreational parks, an artificial beach, as well as security and safety services, the source said. This latest revelation adds a twist to the conditions related to the deal offered by the Penang government if it chooses to accept the concrete deck island proposal tagged at a gross development value of RM142 The land value is based on land prices in Singapore, Japan, Hong Kong and Japan because of facilities that would be made available such as renewable energy and mixed development The proposal by the Hong Kong investors is not new to Penang as it was once suggested but rejected by Guan Eng. The Edge file photo billion, the source said. The source added that the cost of building the decks would, however, require cross financing and expertise, which the investors were already privy to, including that from the Dutch Hydraulics Institute (DHI). The source said the Hong Kong investors, represented here by independent strategic adviser Datuk Dr Nik Zamri Majid, and who are also involved in property developments in China, had suggested that the offshore concrete decks be built off Gertak Sanggul near Pulau Kendi. The source said the plan was for the appointed project delivery partner (PDP) for the PTMP to purchase the rights from the Hong Kong investors to develop the decks while earning construction and development profits profits. The contractors are expected to earn between 20% and 25% profit from the deck development, while the state government would benefit through local and foreign investments, and upstream and downstream industrial activities, the source said. “It is believed that the contractor would be able to earn profits from the construction of the PTMP, Menapolis, development on the decks and from the sale of the developments,” the source said. The proposal by the Hong Kong investors is not new to Penang as it was once suggested but rejected by Chief Minister Lim Guan Eng in January 2013, said the source, adding that this would be the biggest concrete deck in the world. Back then, a Kuala Lumpur-based company Al Cube Sdn Bhd consisting of local and Hong Kong investors proposed to build a RM75 billion “offshore concrete structure for industrial development” on stilts in Balik Pulau. It was to feature electrical and electronic, and oil and gas industries, government offices, schools, hotels, residences, parks, and an artificial beach, and house about half a million people. When contacted, Nik Zamri, who was also its then project consultant, declined to comment on the investors’ latest venture in Penang. “This time, the investors who were represented by a local alliance, proposed the solution to land reclamation to the state during a PTMP briefing in Komtar on March 9. “They admitted their inability in fulfilling the entire requirement in the PTMP (consisting of recommendations to reduce traffic congestion) but were certain they could solve the issue of land reclamation,” the source said. The source said the investors predicted a value of RM750 per sq ft for the decks when completed. The investors believed concrete decks reduced environmental impact. “The land value is based on land prices in Singapore, Japan, Hong Kong and Japan because of facilities that would be made available such as renewable energy and mixed development,” the source said. However, the source said the investors were also keen on working with the PDP to build the tramway at an estimated cost of between RM850 million and RM1 billion on the island. The source said the investors were aware that most of the bidders for the PTMP were “not very keen” on building the tramway because of the low returns. “Thus, the investors are willing to work with the PDP to build the 19km tramway from Weld Quay to the Penang International Airport. Its local alliance is believed to have been approached by leading trams and rail manufacturers to develop it. “They include German Siemens AG which would be using Chinese technology, and plane and train maker Canadian Bombardier Inc. The investors might seek help from French contractor Vinci Construction Grande Projets. “The local alliance, who is said to have ample experience in this field, has spoken to the bidders to offer the investors’ services as well as the proposal to build the concrete decks. “If the investors’ proposal is accepted, DHI will be tasked to conduct the environmental impact assessment,” the source added. Proposal raises interest and reservations BY SA NGEETHA AM ARTHALINGAM GEORGE TOWN: A private financing initiative (PFI) solution offered by two Hong Kong investors to the state government to build a 2,500ha offshore concrete island deck has raised both interest and reservations. Declining to be named, an expert in the land reclamation industry told The Edge Financial Daily that the RM142 billion project proposed as an alternative to the Middlebank reclamation would serve the same purpose. “The development would serve the same purpose whether the land is reclaimed or if it featured concrete decks,” said the expert, adding that the reclamation cost would also be less than half the decks’ gross development value. The concrete deck island, dubbed Menapolis (elevated water city), has been proposed by the investors through local independent strategic adviser Datuk Dr Nik Zamri Majid as the means to finance the RM27 billion Penang Transport Master Plan (PTMP). The investors, who were among six bidders who submitted their proposals for the 15-year PTMP project, were said to have highlighted the environmental advantages the sea decks would have over reclamation. To this, the expert questioned the investors’ reason in taking extra risks of building concrete decks because human lives were involved. “When we build something loosely anchored, it becomes more risky than reclaimed land,” the expert said. Meanwhile, Raine & Horne (Penang) director Michael Geh told The Edge Financial Daily that the land price, which the investors valued at RM750 per sq ft when completed, was dependent on the permissible usage on the platform. “It is difficult to say if the land value is fair or not because we do not know the actual permissible usage and density allowed by the state. That would depend on the density level allowed by the state government,” he said. While Geh is unable to comment further because the project is still at proposal stage, he said the project’s value should also take into account its proximity to Gertak Sanggul, a less developed area where the land value would be lower. Sarawak’s exports last year up 7% to RM116.67b KUCHING: Sarawak recorded an export value of RM116.67 billion last year compared with RM108.4 billion the previous year — an increase of 7%. Sarawak Matrade (Malaysia External Trade Development Corporation) director Leany Mokhtar said according to figures released by the Statistics Department recently, the state’s export value was RM103.63 billion in 2012. She said natural gas and manufactured goods dominated Sarawak’s main exports, representing 64.59% of total exports last year, followed by petroleum and petroleum-related products at 24.85%. “Others included fixed vegetable oils, fluid or solid, crude, refined or purified (8.4%), veneers, plywood, particle boards and other woods (4.92%), and non-ferrous metals (2.8%),” she said. She said Japan remained Sarawak’s major export destination, accounting for 45.52% of Sarawak’s export value, followed by Peninsular Malaysia (18.56%), South Korea (12.45%), Taiwan (9.87%) and China (7.9%). On Sarawak’s cross-border trade with Kalimantan Barat, Indonesia, Leany said Sirikin and Tebedu were the two main border points. — Bernama Melaka medical centre gearing for expansion BY C H R IS T IN E L IM KUALA LUMPUR: Mahkota Medical Centre Melaka, the largest private hospital in southern Peninsular Malaysia, is investing about RM200 million to build a new 500-bed hospital block. Chief executive officer Stanley Lam said the new block, on a parcel of land adjacent to the existing 270-bed hospital building, will be ready in two to four years. Lam said the hospital, owned by Health Management International Ltd (HMI), a company listed on the Singapore Exchange, has more than 300,000 patients annually, with more than 30 of them foreigners, mainly from Indonesia. “Every year our patient numbers increase by more than 6%. There has been an increase in medical tourism in Malaysia, which can provide equally good medical treatment at a fraction of the cost when compared with Singapore,” he said. The centre, with its niche in the middle-income group, has seen a steady increase in annual revenue of more than 10%. — Bernama HOME BUSINESS 7 M ON DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY Six Flags keen on Malaysian entry It is seeking partner to establish brand here BY VA SA NTHA GA N ESAN KUALA LUMPUR: United Statesbased theme park owner and operator Six Flags Entertainment Corp — known for having some of the wildest and fastest roller coaster rides in the world today — plans to enter the Malaysian market and is seeking a partner to establish the brand here, said government matchmaker Malaysia Property Incorporated (MPI). MPI, whose main function is to bring in foreign investment into Malaysia’s real estate, had in its latest Property Quotient Issue 3, 2015, highlighted Six Flags’ interest in having a presence in Malaysia. Six Flags, said to be the world’s largest regional theme park company with a revenue of US$1.2 billion (RM4.39 billion), offers world-class coasters, family rides, animal encounters and water parks. The business is listed on the New York Stock Exchange. “We are matchmaking them,” MPI general manager Veena Loh said when contacted by The Edge Financial Daily. She added that MPI was Loh says Six Flags explored the possibility of investing here several years ago, but the venture did not materialise. Photo by Abdul Ghani Ismail approached by a Six Flags representative less than a month ago. According to Loh, Six Flags explored the possibility of investing here several years ago, but the venture did not materialise. “They are now looking at a franchise format and for this partner to run [the] Six Flags [franchise here] for them,” she added. MPI, a Malaysian government initiative under the purview of the Economic Planning Unit of the Prime Minister’s Department, serves as a bridge between foreign investors and real estate investment opportunities in Malaysia. It is calling out to any developer or entrepreneur who may be interested in this Six Flags’ venture. The article pointed out four potential states most suitable for a Six Flags’ amusement park — Penang, Johor (Iskandar Malaysia), Melaka and Selangor (Sepang). All these states have high local and foreign tourist arrivals. Johor, for example, is expected to have the highest concentration of theme parks and amusement parks. Malaysia is quickly becoming a popular theme park and amusement park destination in the region — with the potential of emerging as the theme park capital of Southeast Asia, a position comparable to that of Orlando in Florida, the US. Last November, The Edge weekly said it had managed to identify that Malaysia will have at least 50 theme parks by 2020. The highest concentration of theme parks will be in Johor with 15, followed by Selangor with 10. Established theme park operators have started to bring in foreign licensed intellectual properties (IPs) in recent years to be able to compete better. Sunway Bhd (fundamental: 1.5; valuation: 1.8), for example, has tied up with US cable television network Nickelodeon to introduce the Nickelodeon Lost Lagoon, while the Genting group will, in 2016, have its Resort World Genting 20th Century Fox World, a movie-inspired outdoor theme park. Australia-based Sanderson Group International, together with Perak Corp Bhd (fundamental: 1.9; valuation: 2), have also tied up with DreamWorks for the development of an animation theme park in Ipoh, which is set to open its doors to the public by the end of this year. Khazanah Nasional Bhd’s Themed Attractions and Resorts Sdn Bhd (TAR) got the ball rolling when it brought in Merlin Enter- tainments Group’s Legoland Resort, which has both a theme park and a water park in Johor. TAR has also established the first Sanrio Hello Kitty Town outside Japan in Nusajaya, together with the Little Big Club. Next on TAR’s list is the opening of the Ocean Splash Water Park and Ocean Quest Marine Park in Desaru, Johor. Six Flags has 18 parks in the US, Mexico and Canada. The first Six Flags outside the US is expected to open its doors in Dubai, the United Arab Emirates, in 2017. Its founder, Angus Wynne, opened the first Six Flags in Texas in 1961. The Edge Research’s fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations. Go to www. theedgemarkets.com for more details on a company’s financial dashboard. TG AgroSolutions eyes expansion of its operations BY JEFFREY TA N KUALA LUMPUR: Malaysia-based agriculture and plantation firm TG AgroSolutions Ltd plans to expand its operations and generate higher earnings growth after a successful listing on the National Stock Exchange of Australia (NSX) in February. The company specialises in cultivating and supplying high-quality rubber and oil palm seedlings via its wholly-owned subsidiary TG Agro Seedlings Sdn Bhd (TGS). TG AgroSolutions chief executive officer Datuk Yap Foot Loy said the firm’s decision to list outside Malaysia was to tap into the international investor market. “We want to access the international investor market. The NSX is one of the top 10 stock exchanges in the world. It is a good platform for us to raise funds in the future,” he told The Edge Financial Daily in an interview. He added that the foreign listing provides more funding options to TG AgroSolutions, which could be in “more favourable terms” for the company. TG AgroSolutions was listed on the NSX on Feb 16 via the compliance listing approach. As defined by the NSX, the compliance listing does not permit a company to raise any capital in three months before and after the listing application. “We did a compliance listing where we fulfilled all the condi- tions attached as a listed company. So, there is no fundraising in this exercise,” said Yap, who has a 23.81% stake in TG AgroSolutions. At the end of its first trading day, TG AgroSolutions closed at A$0.48 (RM1.35), giving it a market capitalisation of A$120.96 million. According to Yap, the firm is planning to set up two new nurseries covering 30 to 40 acres (12.14ha to 16.19ha) of land in Peninsular Malaysia — one on the East Coast and the other on the West Coast. The expansion is expected to incur a capital expenditure of about RM2 million to RM3 million, which will be financed by internally-generated funds. It will increase the firm’s total number of nurseries to six from the current four. Hence, it is expected to bump up supply of rubber and oil palm seedlings by an additional five million units per year at the start. Currently, TG AgroSolutions has a capacity to produce not less than 10 million seedlings per year. “[From the new nurseries], we expect to go for oil palm first. We plan to produce 30,000 oil palm seedlings per month. So, it will be be 360,000 oil palm seedlings per year,” said Yap. Yap said he wants the company to balance the production of rubber and oil palm seedlings more equally. At the moment, rubber seedlings comprise 80% of its total production. “By the end of the year, it should be 50:50. We intend to produce oil palm seedlings at a minimum of 80,000 to 100,000 units per month, starting in April,” he remarked. Yap said the two new nurseries will be set up via joint ventures with other companies, but he did not name the parties involved, which TG AgroSolutions is currently in talks with. In the long term, Yap said the firm will look to acquire ownership of land that it intends to operate on, but he declined to specify where. The company currently operates its four nurseries on 130 acres of leased land. Yap said TG AgroSolutions will also enhance its logistics capabilities by acquiring five new trucks worth a total of RM1.2 million, which will deliver seedlings to its customers. With the expansion plans in place, Yap is confident that the firm can achieve a profit-after-tax (PAT) growth of at least 25% this year. “It should be better than 2014. [It will] definitely [be] double-digit growth. We expect to grow by at least 25%,” he said. Yap is confident that the firm will perform reasonably well against competition, emphasising that it has the experience, quality and competency to fend off rivals. Some of TG AgroSolutions’ prominent customers include Sarawak Plantation Bhd’s wholly-owned subsidiary Sarawak Plantation Agriculture Sdn Bhd. Others include Risda Semaian, Jabatan Pertanian Sarawak, Lagenda Aktif Sdn Bhd and Solid Oil Palm Plantations Sdn Bhd. Honey (left) and Ooi. Honey’s appointment follows an earlier senior appointment which saw Ooi join the team as general manager, strategy and platforms, in the fourth quarter of last year. New leadership team of Maxus Malaysia BY Y IMIE YO N G KUALA LUMPUR: Global media agency Maxus Global has appointed Glynn Honey as the managing director of Maxus Malaysia, replacing Lorraine Capel who left the agency in the third quarter of last year. In a statement dated April 8, Maxus Global said the appointment follows an earlier senior appointment which saw Eileen Ooi join the team as general manager, strategy and platforms in the fourth quarter of last year. The statement said Honey is a “digital native” who joins Maxus Malaysia after leading digital marketing businesses in the United Kingdom and Australia. It said he had spent his entire 23-year marketing career in digital. “His career highlights include working on one of the first-ever websites to incorporate graphic images in the UK, launching global online banking brand Rabo Bank in Australia, helping Subaru to sell the first-ever car online in Australia, and working with Google on the globally-awarded ‘Build with Chrome’,” the statement added. It also said Honey joined Maxus after successfully leading Mark, M&C Saatchi in Australia. Meanwhile, Ooi is the former head of strategy of Carat Malaysia, with previous experience at Mindshare and Starcom. Maxus Global is part of GroupM, the world’s largest media investment management group that serves as the parent company of all WPP media agencies. Maxus, the newest of GroupM agencies, was set up in 2008 to take advantage of opportunities created in the digital age and to help its clients to “lean into change”. 8 HOME BUSINESS M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY Hovid seeks to market first Malaysian drug globally If pharmaceutical product passes the US Food and Drug Administration’s trials BY JON AT HA N GAN KUALA LUMPUR: Ipoh-based Hovid Bhd may soon be the first Malaysian company with a pharmaceutical product that can be marketed globally, if one of its products — touted as one that can reduce the risk of a mini stroke — passes the US Food and Drug Administration’s trials this year, according to the company’s managing director and chief executive officer David Ho Sue San. Ho said about one in three people who suffer from a transient ischemic attack (TIA), also known as mini-stroke, will eventually have a major episode — with half of them occurring within a year after the first TIA. “The studies on our drug should finish this year and if that proves to be positive, our company will initiate an IND (investigational new drug) filing. That would make it the first Malaysian pharma product in the world,” said Ho, but did not reveal a specific time frame for that. The product, named Tocovid Suprabio, contains a compound extracted from palm oil named tocotrienol, a little known but potent part of the vitamin E family which Ho claims can protect brain cells and prevent risks of stroke. Tocovid SupraBio has been sold locally as a health supplement for 15 years, for which Hovid is increasingly known for, besides its Ho Yan Hor Herbal Tea. The company is also studying the effects of the drug on diabetic patients to see whether it can slow down the risk of diabetic neuropathy, said Ho. Diabetic neuropathy is nerve damage which occurs in individuals as a result of diabetes, which damages nerve fibres throughout the body. While that is ongoing, business-wise, Ho said Hovid (fundamental 2.1; valuation 1.2) will be focusing on three key initiatives this year, namely improve its manufacturing facilities in Ipoh, set up a research and development (R&D) facility in Penang, and establish a centralised logistic warehouse in Perak. Chief financial officer Andrew Goh said the three initiatives — to cost some RM70 million — will be mostly financed by borrowings (80%), while the remainder (20%) will be borne by internally generated funds. Ho said the improvement of its manufacturing facilities in Ipoh will be split into two phases where the company will focus on improving its physical packaging in the first phase and its capsule facility in the second. He said the improvement will double Hovid’s existing production capacity and aid in exports where higher manufacturing standards are required. Ho estimates the improvements to be concluded by this year. He estimates a contribution of 20%-30% to its top and bottom line from its improved manufacturing facilities for the company’s next financial year. For the financial year ended June 30, 2014 (FY14), Hovid reported a net profit of RM18 million, down 11% from RM20.33 it Ho said Hovid will be focusing on three key initiatives this year. The Edge file photo saw in the previous year — due to higher operational expenses and unscheduled repairs and maintenance and lower sales mix margin — even though its revenue rose 6% to RM183.54 million from RM172.51 million. On the company’s R&D facility, Ho said the new facility will help the company conduct more clinical trials and bio-equivalent studies on its existing products. Ho explains that in laymen terms bio-equivalence equates to the rate of absorption when compared to a certified drug. “The new facility will help us conduct clinical trials as it is equipped with hospital beds and staff. This will give us faster development time for our products.” On the company’s centralised logistic warehouse, Ho said the fully automated facility will help the company reduce wastage of inventory and streamline its distribution. Being an exporter of pharmaceutical products to over 50 countries, the company is also a beneficiary of the weakening ringgit. About 60% of its business come from exports while the remainder is made up by local customers. CIMB’s pharmaceutical analyst Saw Xiao Jun said in his note to clients dated March 26 that he expects Hovid’s new capacity for its Ipoh facility to be operational by the middle of this year. “The first phase of its new tablet and capsule plant is on track to commence operations by mid2015, and may take 4-5 months to ramp up production. The second phase of the same plant is expected to start by early-2016,” said Saw in his note. Hovid shares closed at 49.5 sen last Friday, up 2.5 sen or 5.32%, with a market capitalisation of RM362.86 million. The Edge Research’s fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations. Go to www.theedgemarkets.com for more details on a company’s financial dashboard. Xidelang targets doubledigit revenue growth in FY15 BY C H E S T E R TAY PUTRAJAYA: Sports and casual shoe manufacturer Xidelang Holdings Ltd is eyeing double-digit growth in revenue for its financial year ending Dec 31, 2015 (FY15). “We have established a few collaborations with certain international brands, which will see them placing more orders with us,” the China-based group’s managing director cum chief executive officer Mark Ding Peng Peng told reporters after an extraordinary general meeting (EGM) last Friday. These brands include Spain’s Zara and America’s Brooks as well as Sketchers. When pressed for more details, Ding declined to reveal more, citing non-disclosure agreements. According to Ding, Xidelang (fundamental: 1.3; valuation: 1.8) will be one of the manufacturers for these brands. Xidelang has seen its earnings fall for four consecutive financial quarters last year. The group registered a net profit of RM28.21 million for FY14, less than half the RM58.93 million it made in FY13, while revenue contracted 18% to RM301.54 million from RM367.62 million previously. Meanwhile, Ding noted that the group’s traditional sales model is incurring more costs, thus the management is venturing into electronic commerce (e-commerce) “Traditionally, we were focused on our retail outlets. By the second half of 2015, we hope to sell our products online, to adapt to the new market condition,” he said. However, Ding said the idea of going online is still a nascent one. Meanwhile, China remains its main target market. “We will still be distributing our products in China even after we embark on e-commerce,” he stressed. LCTH plans to spend RM65m capital expenditure BY JEFFREY TA N KUALA LUMPUR: Precision plastic injection mould manufacturer LCTH Corp Bhd has plans to spend up to RM65 million in capital expenditure this year as it aims to secure more manufacturing orders. The Johor-based firm, whose customers include Hewlett Packard (HP), Bose Corp, International Business Machines (IBM) and Dyson Ltd, is looking to obtain more orders from its existing customers as well as new ones. “We are trying to get more projects from them (existing customers). We are also looking for new customers,” LCTH’s managing director Hew Lien Lee told The Edge Financial Daily. LCTH (fundamental: 2.5; valuation: 1.2) currently operates two manufacturing plants with one new plant in Johor and the other in Penang. Incorporated in 2003, LCTH has two wholly-owned subsidiaries — Penang-based Fu Hao Manufacturing (M) Sdn Bhd and Johor-based Classic Advantage Sdn Bhd. The two subsidiaries are engaged in the manufacturing and sub-assembly of precision plastic parts and components as well as fabrication of precision moulds and dies. The company also has a 40% stake in Berry Plastic Malaysia Sdn Bhd, which is principally involved in the manufacturing and assembly of precision plastic moulded products for electrical, electronics, healthcare, food and petroleum industries. In a phone interview, Hew said the company is in talks with the Penang state government to buy land for manufacturing expansion, though discussions are still at a preliminary stage. According to Hew, the move to buy the land is necessary as the Fu Hao plant is already op- erating at peak capacity. Assuming the state government approves the land buy, the total investment cost could amount to RM30 million to RM40 million, inclusive of building the plant, said Hew. In Johor, Hew said LCTH still has surrounding land to build another plant. “We still have land in excess of three acres (1.214ha) to utilise,” he said, noting that this gives it the advantage to build immediately if demand increases. A new plant can cost it RM15 million-RM20 million. Hew is optimistic the firm may source more orders this year from multinational companies (MNCs) as some are relocating here from China due to escalating costs there. “We still see some growth in Penang because of more MNCs setting up plants there. Just last year, Bose held its opening ceremony [at its plant] in Batu Kawan. HP also intends to move some of its businesses to Johor from China. We will try to capitalise on that move,” he added. Hew said LCTH intends to buy new injection moulding and tooling machineries as part of the company’s renewal process, which could amount to RM3 million to RM5 million. “Whenever we make money, we will try to renew both injection moulding and tool-making machines just to stay ahead of the competition,” he said. With the significant capex spend it is looking at, it is fortunate that LCTH is flush with cash. As at Dec 31, 2014, the company net cash stood at RM73.8 million. “The reason why we have survived all this while is because we have a healthy cash flow,” said Hew. For the quarter ended Dec 31, 2014 (4QFY14), LCTH’s net profit went up more than 10 times to RM5.95 million from RM438,000 a year ago, mainly due to its fo- cus on higher margin projects with lower costs as a result of the right-sizing exercises. For the full FY14, however, its net profit slipped 18% to RM12.9 million from RM15.8 million in the previous year — due mainly to the one off gain on disposal of property, plant and equipment in year FY13. Excluding this one-off gain in the year 2013, the group achieved better performance in terms of profitability in FY14 compared with FY13, the company noted in its latest results filing. LCTH closed down half sen to 42 sen last Friday — which is still up a whopping 86.7% compared with 22.5 sen on Dec 15 last year. The latest price gives it a market capitalisation of RM151.2 million. On the share price hike, Hew said: “The investing public is reacting to our improved financial results. I believe shareholders are happy to see the share price gain.” ST O C KS W I T H M O M E N T U M 9 M O N DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY This column is an analysis done by Asia Analytica Sdn Bhd on the fundamentals of stocks with momentum that were picked up using proprietary algorithm by Anticipatory Analytics Sdn Bhd and that first appeared at www.theedgemarkets.com. Please exercise your own judgment or seek professional advice for your specific investment needs. We are not responsible for your investment decisions. Our shareholders, directors and employees may have positions in any of the stocks mentioned. FRONTKEN CORPORATION BHD (-ve) FRONTKEN (Fundamental: 1.8/3, Valuation: 1.1/3) was the most actively traded stock last Friday with more than 177 million shares changing hands. It closed up 2.5 sen or 13.2% to 3-year high of 21.5 sen. Frontken provides surface and mechanical engineering services to a wide range of heavy industries such as oil & gas, power generation and semiconductor. For 2014, revenue saw a significant 62.6% increase to RM309.8 million. Domestic market accounted for about half of total revenue, FRONTKEN CORPORATION BHD with the balance coming from, mainly, Taiwan and Singapore. Net profit surged to RM18.8 million, a reversal from net loss of RM2.3 million in 2013, due to stronger demand from the semiconductor industry and progressive income recognition from a hydrocarbon project in Tanjung Bin, Johor. Frontken has a net cash position of RM28.8 million. The stock is trading at a trailing 12-month P/E of 10.6 times and 0.96 times book value of 24 sen. Valuation score* 1.10 1.80 Fundamental score** 10.61 TTM P/E (x) TTM PEG (x) 0.96 P/NAV (x) TTM Dividend yield (%) 199.21 Market capitalisation (mil) Shares outstanding (ex-treasury) mil 1,048.47 1.24 Beta 0.10-0.20 12-month price range *Valuation score - Composite measure of historical return & valuation **Fundamental score - 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 HO WAH GENTING BHD (-ve) HO Wah Genting Bhd (HWGB) (Fundamental: 0.35/3, Valuation: 0.3/3) is mainly involved in manufacturing and trading of wires and cables, moulded power supply cord sets and cable assemblies for electrical and electronic devices. Its share price has risen steadily this year, after falling to a 3-year low of 11.5 sen in mid-December 2014. The stock gained 17.9% last week on rising volume to close at 16.5 sen. HWGB has been in the red since 2011. Revenue for 2014 declined 16.5% y-y to HO WAH GENTING BHD RM191.4 million on lower demand for wires and cables. Pre-tax losses was slightly lower at RM22.8 million, from RM25.8 million in 2013, due to lower impairments on securities investments. The company is hopeful that a stronger housing market in the US, its primary market, will result in better performance going forward, although competition is expected to remain intense. Gearing is high at 57.8% as end-2014 while interest cover is negative. Valuation score* 0.30 0.35 Fundamental score** TTM P/E (x) TTM PEG (x) 1.75 P/NAV (x) TTM Dividend yield (%) 96.18 Market capitalisation (mil) 601.15 Shares outstanding (ex-treasury) mil 1.47 Beta 0.12-0.21 12-month price range *Valuation score - Composite measure of historical return & valuation **Fundamental score - 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 VISDYNAMICS HOLDINGS BHD (-ve) FRONTKEN CORPORATION BHD (ALL FIGURES IN MYR MIL) Financials Turnover EBITDA Interest expense Pre-tax profit Net profit - owners of company Fixed assets - PPE Total assets Shareholders' fund Gross borrowings Net debt/(cash) FRONTKEN CORPORATION BHD RATIOS DPS (MYR) Net asset per share (MYR) ROE (%) Turnover growth (%) Net profit growth (%) Net margin (%) ROA (%) Current ratio (x) Gearing (%) Interest cover (x) HO WAH GENTING BHD (ALL FIGURES IN MYR MIL) Financials Turnover EBITDA Interest expense Pre-tax profit Net profit - owners of company Fixed assets - PPE Total assets Shareholders' fund Gross borrowings Net debt/(cash) HO WAH GENTING BHD RATIOS DPS (MYR) Net asset per share (MYR) ROE (%) Turnover growth (%) Net profit growth (%) Net margin (%) ROA (%) Current ratio (x) Gearing (%) Interest cover (x) VISDYNAMICS HOLDINGS BHD (ALL FIGURES IN MYR MIL) VISDYNAMICS (VIS) (Fundamental: 2.5/3, Valuation: 0.3/3) traded as high as 31 sen last Friday, before closing down 1.7% at 29.5 sen. The company proposed a private placement last month. Proceeds from the placement, involving up to 10 million new shares of RM0.10 each or 9.9% of existing share capital, are intended for working capital and future expansion plans. The issue price is yet to be determined. Based in Malacca, VIS provides equipment VISDYNAMICS HOLDINGS BHD solutions to the semiconductor assembly and test industry. The company derives most of its sales from North Asia. Balance sheet is solid with net cash of RM2.1 million or 2.1 sen per share. But VIS was loss-making in FYOct2012-FY2013 on falling sales, although it recovered some in FY2014 to book a net profit of RM1.24 million. The stock is trading at a relatively high trailing 12-month P/E of 22.5 times and 1.66 times book value. No dividend was paid since April 2011. Valuation score* 0.30 2.50 Fundamental score** 22.53 TTM P/E (x) TTM PEG (x) P/NAV (x) 1.66 TTM Dividend yield (%) 30.21 Market capitalisation (mil) 100.70 Shares outstanding (ex-treasury) mil 0.93 Beta 0.19-0.77 12-month price range *Valuation score - Composite measure of historical return & valuation **Fundamental score - 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 Financials Turnover EBITDA Interest expense Pre-tax profit Net profit - owners of company Fixed assets - PPE Total assets Shareholders' fund Gross borrowings Net debt/(cash) VISDYNAMICS HOLDINGS BHD RATIOS DPS (MYR) Net asset per share (MYR) ROE (%) Turnover growth (%) Net profit growth (%) Net margin (%) ROA (%) Current ratio (x) Gearing (%) Interest cover (x) FY11 FY12 FY13 FY2014Q4 31/12/2011 31/12/2012 31/12/2013 31/12/2014 198.12 24.62 2.80 3.00 2.48 180.97 262.78 179.27 68.63 42.27 181.03 26.50 2.87 3.24 3.82 153.53 245.10 184.89 61.23 19.77 190.61 27.24 1.45 5.91 (2.32) 144.05 243.71 186.30 32.45 (4.66) 105.05 14.74 0.35 9.91 7.16 135.55 267.68 206.81 35.12 (28.82) FY11 FY12 31/12/2011 31/12/2012 31/12/2013 0.18 1.40 35.05 (79.28) 1.25 0.94 1.69 23.58 8.78 0.18 2.10 (8.62) 53.78 2.11 1.50 1.88 10.69 9.23 0.18 (1.25) 5.29 (1.22) (0.95) 2.23 18.77 FY13 ROLLING 12-MTH 0.20 9.84 62.55 6.06 7.56 2.08 36.21 FY11 FY12 FY13 FY2014Q4 31/12/2011 31/12/2012 31/12/2013 31/12/2014 246.66 (0.95) 5.70 (10.72) (6.52) 62.64 99.43 93.83 73.49 53.40 243.57 (22.34) 5.04 (34.14) (32.52) 58.08 82.95 86.91 69.74 46.81 229.20 (12.77) 4.69 (25.82) (24.43) 58.70 72.93 76.56 73.26 43.45 39.17 (8.57) 1.12 (11.42) (10.86) 58.72 72.39 55.00 43.66 31.81 FY11 FY12 31/12/2011 31/12/2012 31/12/2013 0.19 (6.85) 2.55 (2.64) (6.13) 0.88 56.91 (0.17) 0.16 (35.98) (1.25) (13.35) (35.66) 0.89 53.86 (4.43) 0.13 (29.89) (5.90) (10.66) (31.35) 0.86 56.74 (2.72) FY13 ROLLING 12-MTH 0.06 (32.10) (16.43) (11.10) (26.58) 1.04 57.82 (2.82) FY12 FY13 FY14 FY2015Q1 31/10/2012 31/10/2013 31/10/2014 31/1/2015 9.75 0.09 0.06 (0.44) (0.44) 5.48 18.80 18.66 1.76 (4.02) 3.62 (2.00) 0.03 (2.40) (2.40) 5.11 16.27 16.27 0.37 (1.84) 16.12 1.73 0.05 1.24 1.24 4.74 17.51 17.51 2.52 (1.35) 3.27 0.75 0.02 0.68 0.68 4.84 18.19 18.19 1.53 (2.14) FY12 FY13 31/10/2012 31/10/2013 31/10/2014 0.19 (2.32) (37.73) (4.50) (2.28) 4.00 1.43 0.16 (13.71) (62.82) (66.11) (13.66) 5.09 (60.28) 0.17 7.35 344.78 7.70 7.35 2.54 34.35 FY14 ROLLING 12-MTH 0.18 7.89 115.70 8.58 7.88 3.32 24.35 1 0 I N V E ST I N G I D E A S M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY Note: This report is brought to you by Asia Analytica Sdn Bhd, a licensed investment adviser. Please exercise your own judgment or seek professional advice for your specific investment needs. We are not responsible for your investment decisions. Our shareholders, directors and employees may have positions in any of the stocks mentioned. I N S I D E R A S I A’S S TO C K O F T H E D AY KOSSAN RUBBER INDUSTRIES BHD (ALL FIGURES IN MYR MIL) KOSSAN RUBBER INDUSTRIES BHD SHARES for the four biggest glove makers have far outperformed the broader market in the year-to-date. This we believe is due, in no small part, to the precipitous drop in the ringgit against the US dollar — glove makers are, primarily, exporters. The current environment of low commodity prices would also favour the industry. Low oil and rubber prices translate into cheaper selling prices — which will, in turn, be the perfect time to encourage greater adoption/ consumption. This is particularly true in developing countries, including China, where per capita consumption is still very low — and where usage is more price-sensitive. Since Kossan (Fundamental: 2.1/3, Valuation: 0.5/3) was first featured by InsiderAsia, on October 15, 2014, its shares have gained 31.6% to close at RM5.71 yesterday. The stock is not cheap, trading at trailing P/E of 25 times against the broader market average KOSSAN RUBBER INDUSTRIES BHD of 16 times. By comparison, Top Glove and Supermax are trading at 14-17 times although Hartalega is priced at nearly 33 times. Nevertheless, we expect earnings growth to far outpace that of the broader market. Kossan boosted annual production capacity by 38% to 22 billion pieces at end-2014 and plans to raise this further this year, on the back of strong orders for its glove products. Furthermore, the company started shifting towards nitrile gloves, which offer better margins compared to natural rubber gloves, in 2013. It aims to hit nitrile to natural rubber mix of 70:30 this year, compared to 57:43 last year. Its return on equity (ROE) — with modest gearing — of 19.8% is one of the highest in the industry. Utilization is consistently high, above 85%. By comparison, ROE for Top Glove and Supermax stood at 14% and 11%, respectively, while Hartalega, which manufactures mainly nitrile gloves, has a high ROE of over 21%. Valuation score* 0.50 2.10 Fundamental score** 25.31 TTM P/E (x) 11.42 TTM PEG (x) 4.52 P/NAV (x) 1.23 TTM Dividend yield (%) 3,638.57 Market capitalisation (mil) Shares outstanding (ex-treasury) mil 639.47 0.45 Beta 3.57-5.85 12-month price range *Valuation score - Composite measure of historical return & valuation **Fundamental score - 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 Income Statement Turnover EBITDA Depreciation EBIT Associates Interest income Interest expense Extraordinary gain/(loss) Pre-tax profit Net profit - 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 KOSSAN RUBBER INDUSTRIES BHD RATIOS DPS (MYR) Net asset per share (MYR) ROE (%) Turnover growth (%) Net profit growth (%) Net margin (%) ROA (%) Current ratio (x) Gearing (%) Interest cover (x) FY11 FY12 FY13 FY2014Q4 31/12/2011 31/12/2012 31/12/2013 31/12/2014 1,089.97 159.08 40.91 118.17 1.59 7.47 112.29 89.19 1,234.00 188.89 45.10 143.79 1.07 6.41 138.45 102.16 1,307.29 235.31 50.98 184.33 2.69 6.88 180.13 136.42 360.96 65.49 14.70 50.79 0.47 2.04 49.21 37.93 473.24 4.93 51.62 374.40 124.94 245.92 606.80 531.16 18.20 514.37 4.93 99.85 470.51 151.98 284.45 705.49 604.60 35.68 600.54 4.93 100.60 500.44 112.17 278.73 827.29 704.94 37.86 724.53 4.93 71.70 550.89 122.01 329.49 950.98 804.82 40.05 FY11 FY12 31/12/2011 31/12/2012 31/12/2013 FY13 ROLLING 12-MTH 0.07 1.66 18.32 4.12 (21.33) 8.18 16.05 1.52 17.23 21.31 0.12 1.89 17.99 13.21 14.54 8.28 15.57 1.65 14.52 29.48 0.07 1.10 20.84 5.94 33.53 10.44 17.80 1.80 7.01 34.18 0.07 1.26 19.80 (0.80) 2.22 11.06 16.96 1.67 11.23 30.48 B R O K E R S’ C A L L 11 M ON DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY MAHB’s Turkey business better than expected Mobile HyppTV for DiGi subscribers DiGi.Com Bhd FYE DEC (RM MIL) Revenue Operating profit Pre-tax profit Net profit EPS (sen) PER (x) DPS (sen) Dividend yield 2013A 6,733.4 2,141.5 2,140.2 1,705.9 21.9 28.8 21.3 3.4 2014A 2015F 2016F 2017F CAGR (%) 7,018.5 7,260.2 7,510.5 7,722.9 2,658.6 2,787.0 2,886.0 2,952.6 2,645.2 2,766.4 2,867.6 2,936.7 2,031.1 2,088.6 2,179.4 2,231.9 26.1 26.9 28.0 28.7 24.1 23.4 22.5 22.0 26.0 26.9 28.0 28.7 4.1 4.3 4.4 4.6 2.8 6.6 6.5 5.5 5.5 Source: Company, PublicInvest Research estimates Malaysia Airports Holdings Bhd (April 10, RM6.99) Maintain hold with a higher target price (TP) of RM7.45 from RM7.22: This is the first of a two-part series on Malaysia Airports Holdings Bhd (MAHB)’s businesses in Malaysia and Turkey. Unfortunately, our “hold” call is intact as the outlook for Malaysia is weak, though Turkey is doing better than expected. We recommend to switch to Westports Holdings Bhd. Even so, we raise our discounted cash flow (DCF)-based TP to RM7.45, as we raise the value of both the Malaysia and Turkey businesses, due to lower discount rates. We raise our financial year 2015 forecast (FY15F) as we incorporate an additional 40% contribution from Turkey, but cut FY16 core earnings per share (EPS) as we adopt MAHB’s depreciation practice until 2034, instead of 2069. Our DCF still discounts cashflow to 2069, assuming the KLIA concession is extended. In our first instalment, we take a closer look at Istanbul Sabiha Gökçen (ISG), which is doing better than expected. Although ISG suffered a core net loss of €33 million (RM128.24 million) in FY14, it was ahead of our €41 million loss forecast. FY15 looks brighter for ISG with passenger traffic growth forecast at 20%, against our old 7% forecast. We believe our new passenger traffic growth forecast is achievable, after reviewing the latest guidance from the two airlines that use ISG, i.e. Pegasus Airlines and Turkish Malaysia Airports Holdings 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) 2013A 2014A 2015F 2016F 2017F 4,099 811 389.2 0.25 (13.9) 27.87 0.11 1.59 15.50 na 73.7 1.94 7.17 3,344 846 748.6 0.13 (46.4) 49.72 0.05 0.78 17.08 na 57.7 1.37 3.20 3,902 1,434 173.6 0.11 (18.3) 60.31 0.07 1.03 10.47 235.0 39.0 1.31 2.22 4,262 1,578 167.4 0.14 23.9 51.82 0.07 1.00 9.09 8.2 31.3 1.30 2.52 4,480 1,756 249.0 0.22 66.2 34.48 0.08 1.13 6.58 7.8 22.2 1.06 3.42 9.1 0.72 (32.0) 0.46 0.77 Source: CIMB, Company reports Airlines, and examining the airlines forward seat capacity plans. Hence, we expect ISG to turn a core net profit of €12.6 million in FY15, up from the previous loss forecast of €30 million. The second runway is critical for the Istanbul Sabiha Gokcen International airport (SAW) to take advantage of the congestion at the Istanbul Ataturk airport, because SAW’s single runway is saturated during the peak morning and evening slots. Sadly, a delay in the completion of the second runway from early-2016 to mid-2017 will shorten the golden period for SAW that lies between the completion of its second runway and the expected commissioning of Istanbul’s third airport in early 2019. This is a golden period of growth for SAW because airlines have nowhere else to go until the third airport is ready, but this duration of time is now expected to be 1½ years. We valued ISG in mid-2014 at €620 million. Our revised valuation is €667 million, mainly due to accretion from using a lower cost of equity, but largely offset by lower cash flow from the delay in the completion of the second runway, and a reduction in our assumption of the growth of duty-free revenue per pax. In conclusion, MAHB’s purchase of 40% of ISG from GMR Infrastructure Ltd in April 2014 was 23% less than our base-case valuation, but its recent 40% purchase from Limak Holdings AS was 4.6% overpriced. — CIMB Investment Bank Bhd, April 9 Sunway to acquire premium wholesale hardware firms Sunway Bhd (April 10, RM3.76) Maintain buy with a target price (TP) of RM3.76: Sunway is proposing to acquire Winstar Trading Sdn Bhd (Winstar) and PND Hardware & Trading Pte Ltd (PND) for RM130.9 million and S$2.6 million (RM6.96 million), respectively. The acquisitions will be completed in three tranches whereby Sunway will first acquire a 60% stake, expected to be completed by the second quarter of 2015 (2Q15) in the companies, followed by an additional 20% stake each by 2Q17 and 2Q18. There is a profit guarantee for financial years 2015 (FY15) to FY17 of RM15 million per annum and S$250,000 per annum for Winstar and PND, respectively, implying good prospects for the hardware trading business. This translates into 8.7 times price-earnings ratio (PER) for Winstar and 10.4 times for PND. Given that both companies are market leaders with over 30 years of experience in the wholesale hardware market with extensive distribution networks and customer bases, the acquisitions will complement Sunway’s trading and manufacturing division. We maintain our earnings forecast for now as Sunway’s 60% stake in Winstar and PND will only increase our FY16 earnings by 1.6%. The listing of Sunway Construction Group Bhd by June this year remains the next re-rating catalyst for the group, given the potential 9% yield (special cash dividend and free Sunway Construction shares). Nevertheless, our rating is under review as the share price has rallied 14% since our last update in February, and is now close to our TP. — Alliance DBS Research Sdn Bhd, April 10 DiGi.Com Bhd (April 10, RM6.25) Maintain neutral with a target price (TP) of RM5.90: According to news reports, DiGi.Com Bhd (DiGi) will collaborate with Telekom Malaysia Bhd (TM) to offer TM’s Internet Protocol television (IPTV) services (HyppTV) for DiGi subscribers. Under the collaboration, TM will provide entertainment, sports and video on demand on its HyppTV to DiGi’s subscribers through the mobile application, HyppTV Everywhere. The mobile service is due to be launched today. While we are positive on DiGi tapping into additional digital content to stimulate mobile data usage, we believe the new service will have negligible financial impact (less than 1% on top line) on DiGi. HyppTV Everywhere is a mobile (on-the-go) version of TM’s HyppTV’s service which will enable users to view the IPTV channels via smartphones, tablets and notebooks. Previously, HyppTV was only offered to UniFi and Streamyx, but TM has offered the service since January to any user who downloads the HyppTV Everywhere app (either android or iOS). The HyppTV Everywhere has two major components: broadcast live TV (free channels such as Channel News Asia and Bloomberg TV, and premium channels such as Warner TV and Cinema World), and Video on Demand (channels such as Cinema World HD On Demand and HyppSports HD On Demand). Currently, non-HyppTV subscribers can choose three channels from RM15.90 a month or purchase premium channels on an a la carte basis. We b e l i e v e d e d i c a t e d DiGi-HyppTV Everywhere packages will be offered to DiGi subscribers to differentiate from what is currently being offered. While we are positive that additional digital content offered by HyppTV Everywhere will be helpful for DiGi to increase data usage by its subscribers, we believe the take-up rate of paid subscription of HyppTV Everywhere by DiGi subscribers will be rather limited as there are plenty of free or competing alternatives available on the Internet. The collaboration is a good start for DiGi to increase its digital content offering without incurring substantial costs, as well as to drive data usage by its mobile data subscribers. We reiterate our “neutral” call on DiGi with an unchanged discounted cash flow (DCF)-derived TP of RM5.90. — Public Investment Bank Bhd, April 10. Sunway Bhd FYE DEC (RM MIL) Revenue Ebitda Pre-tax profit Net profit Net pft (pre ex) EPS (sen) EPS pre ex (sen) EPS gth (%) EPS gth pre ex (%) Diluted EPS (sen) Net DPS (sen) BV per share (sen) PER (x) PER pre ex (x) P/Cash flow (x) EV/Ebitda (x) Net div yield (%) P/Book value (x) Net debt/Equity (x) ROAE (%) 2014A 2015F 2016F 2017F 4,842 962 969 743 592 43.1 34.3 (50) 22 37.0 10.3 344.9 8.7 11.0 8.4 9.0 2.7 1.1 0.3 13.2 5,361 949 719 569 569 33.0 33.0 (23) (4) 28.3 9.9 368.0 11.4 11.4 8.6 9.0 2.6 1.0 0.2 9.3 5,943 1,000 753 597 597 34.6 34.6 5 5 29.7 10.4 392.3 10.9 10.9 10.2 8.5 2.8 1.0 0.2 9.1 5,236 969 717 552 552 32.0 32.0 (7) (7) 27.5 9.6 414.7 11.7 11.7 11.1 8.8 2.6 0.9 0.2 7.9 Source: Company, AllianceDBS, Bloomberg Finance L P 12 B R O K E R S’ C A L L M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY Unimech affected by margin compression Unimech Group Bhd (April 10, RM1.41) Maintain sell with unchanged target price (TP) of RM1.45: Unimech Group Bhd’s (Unimech) share price had declined by 21% since the peak of RM1.78 in October 2014. We believe the weakening of the share price was due to persistent margin compression as observed in the quarterly financial results and uncertainty in the outlook of the oil and gas as well as plantation sectors. We see no immediate rerating catalyst at this juncture and margin compression remains a major concern. Therefore, we reiterate our “sell” recommendation for Unimech with an unchanged TP based on calendar year 2016 (CY16) price-earnings ratio (PER) of 10 times. On an annual basis, Unimech’s margin started to narrow noticeably in financial year 2014 (FY14) despite an increase in revenue. We believe the group may lose control over the pricing power for some of its products in FY14. Furthermore, higher finance cost and depreciation have exacerbated the situation. The group’s margin had been resilient at around 19% to 20% in the FY09 to FY13 period, which had Unimech Group Bhd FYE DEC 31 (RM MIL) Revenue Ebitda Ebitda margin (%) Pre-tax profit Net profit Core net profit Diluted EPS (sen) Diluted EPS growth (%) PER (x) Net DPS (sen) Div yield (%) ROE (%) FY13 FY14 FY15E 2016F 2017F 227.2 45.2 19.9 32.5 20.6 20.7 17.1 (6.0) 8.3 6.0 4.3 10.6 238.0 42.0 17.7 25.9 15.5 15.3 10.2 (40.0) 13.8 4.5 3.2 7.0 249.1 55.5 22.3 35.0 19.9 19.9 12.8 24.6 11.1 5.5 3.9 8.6 264.7 60.2 22.8 39.0 23.0 23.0 14.5 13.5 9.7 6.8 4.8 9.4 285.7 62.6 21.9 40.5 23.9 23.9 15.0 3.5 9.4 7.1 5.0 9.2 Source: TA Securities previously served as an investment merit. We note that margin has deteriorated since then, especially over the last two quarters of FY14. The group recently disposed of a 40% stake in a subsidiary, All Torque Control Pte Ltd (ATC), for S$35,000 (RM93,742). We understand that Unimech will register a loss on disposal as the selling price is less than the book value. Note that ATC has an unaudited shareholders’ fund of S$97,700 as at Dec 31, 2014. Management guided that ATC is actually a dormant entity and doesn’t generate profit as initially planned. The subsidiary is involved in the marketing and supplying of pneumatic actuators for remote control valves for use in oil and gas, refinery, petrochemical, food industry, machine maker, power plant, water treatment plant, oil rig or platform and general trading. Unimech’s official policy is to pay up to 30% of its net profit as dividends. In FY14, the payout ratio worked out to 34%, compared with 35% in FY13. Nonetheless, its dividend per share (DPS) was lower at 4.5 sen in FY14 versus six sen in FY13. Management guided that the capital expenditure (capex) requirement for FY15 will be lower by about RM10 million compared with RM26.9 million in FY14. This suggests upside to dividends going forward. Our analysis indicates that after taking into account the capex requirement, working capital, finance cost and depreciation, Unimech will easily meet the 30% payout target without incurring any additional borrowing. We expect the group to pay DPS of 5.5 sen and 6.8 sen in FY15 and FY16, respectively. That translates into dividend yields of 3.9% and 4.8% in FY15 and FY16. We value the stock based on 10 times CY16 diluted earnings per share of 14.5 sen. Unimech appears to be fairly valued at the current price. The softening outlook for plantation and oil and gas sectors will prompt companies to trim capex budget and reduce the demand for valve products. Downside to the stock price is buffered by the attractive dividend yield. — TA Securities Holdings Bhd, April 10 KNM unveils RM204m contracts for FY15 KNM Group Bhd (April 10, 63.5 sen) Maintain buy with a target price (TP) of 88 sen: KNM Group Bhd (KNM) announced contracts with a total value of RM204 million for year to date in financial year 2015 (FY15). The contract details are: Refinery and Petrochemical Integrated Development (Rapid) subcontractor contract from Toyo Engineering (Package 5) for RM120 million; Rapid subcontractor contract from Technicas (Package 3) for RM54.6 million; and Turkmengas petrochemical complex project for RM29 million. Contracts’ period are for between 12 and 18 months. Total contract win from Rapidcurrently is around RM1.2 billion. We maintain our earnings forecasts as we have already factored in a total of RM2.2 billion in Rapid-related contracts or RM540 million per annum based on a contract duration of four years. We believe our earnings forecast in FY15 is fairly achievable as we only factored in RM270 million revenue from Rapid and we only expect Rapid-related contracts to contribute in the second half of 2015. We are positive on the contract wins. KNM being among the largest process equipment manufacturer KNM Group Bhd FYE DEC (RM MIL) Revenue Ebitda Patami EPS (sen) PER (x) BV/share P/BV (x) ROA (%) ROE (%) 2013A 2014A 2015E 2016E 1,984 199 23 2 31.1 1.40 0.45 0.6 1.1 1,865 277 46 3 22.6 1.35 0.47 1.1 2.1 2,419 288 122 7 8.5 1.42 0.44 2.8 5.2 2,514 297 132 8 7.8 1.50 0.42 2.9 5.4 Source: HLIB should be one of the main beneficiaries of the Rapid project. With the Rapid project proceeding, we expect to see a continuous contract newsflow. We understand that KNM has a good chance to secure more subcontractor jobs from some refinery packages in the near term. In addition, KNM has also sub- mitted bids for subcontractor jobs for the other packages of refinery plant and engineering, procurement, construction and commissioning contract for tank farms and other associated facilities. The recent joint venture (JV) with Korea-based Hansol Corporation (40:60) will be bidding for some biomass projects in Malaysia. The contract size is ranging from RM100 million to RM300 million. We understand there are numerous tenders for biomass projects. Together with United Kingdom’s EnergyPark Peterborough biomass project, we expect to see significant contribution of income from the recurring renewable energy division in the future. Catalysts are the announcement of more Rapid contract wins; financial closing of EnergyPark Peterborough; additional contribution from renewable energy business in Thailand and/or from JV with Hansol Corp. Risks are fluctuation in oil price; project execution ability and delay in contracts award. We maintain our “buy” call with unchanged TP based on unchanged 11 times FY16 price-earnings ratio. Our TP has not factored in value from EnergyPark Peterborough and Thailand’s renewable energy business yet. — Hong Leong Investment Bank Bhd, April 10 Setting up of commission to boost growth of sector Aviation Sector Maintain positive: Parliament passed a new bill, the Malaysian Aviation Commission Bill 2015, which paves the way for the setting up of the Malaysian Aviation Commission (MAC). While the Ministry of Transportation (Mot) and the Department of Civil Aviation (DCA) are already overseeing the aviation industry we believe the addition of the MAC would provide a more structured path to boost the growth of the sector. The MAC focuses on the economic aspects of the aviation industry, which is different from the DCA’s role which covers air traffic management, airworthiness, flight operations, aviation security, etc. The MoT focuses on ensuring all rules in air transport or aviation are in accordance with the International Civil Aviation Organisation and implementing infrastructural projects to meet demands of air transport.The MAC will take over from the MoT (via the DCA) for the issuance and renewal of air service licences (scheduled services) and permits (non-scheduled services). In addition, the MAC will also be responsible for administering, allocating and managing air traffic rights and slot allocations. We believe the MAC would better position Malaysia to take advantage of the implementation of the Association of Southeast Asian Nations Open Sky policy. Furthermore, on the back of a tragic year for the Malaysian aviation industry, we believe the commission could also improve consumer confidence in the aviation sector. The new bill entails several clauses aimed at promoting healthy competition among airlines such as preventing agreements between enterprises which restrict or distort competition (collusion); abuse of a dominant position by an enterprise (anti-monopoly); mergers that diminish competition (antitrust); and reviewing the aviation service market for actions which prevent, restrict or distort competition. The MAC could regulate air fares or excessive capacity expansion to prevent instances of fare dumping, price wars and overcapacity issues as seen in recent years. This would bode well for airline players in the form of higher yields and better load factors. We are positive that the protection of consumer rights is highlighted. Within our coverage, we have “buy” calls on AirAsia Bhd (target price or TP: RM3.70) and AirAsia X Bhd (ex-rights TP: 49 sen) while we are “neutral” on Malaysia Airports Holdings Bhd (MAHB) (TP: RM7.53). — MIDF Amanah Investment Bank Bhd, April 10 14 H O M E M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY Dr M: Set up independent panel for 1MDB probe Former PM unhappy over Najib’s response to the issue Dr Mahathir: Who is this Jho Low, who has suddenly become so very important? Photo by Patrick Goh KUALA LUMPUR: Unhappy over the lack of answers given by Datuk Seri Najib Razak on the 1Malaysia Development Bhd (1MDB) issue, Tun Dr Mahathir Mohamad said the government needs to set up a “totally independent commission” to investigate the debt-ridden government-owned investment company. The former prime minister said the Auditor-General’s office might not do a thorough investigation or forensic [audit], and sought to know when the probe will be concluded. He said it took the courts five years to clear him of a defamation suit, and something like the 1MDB probe would drag on a long time. Dr Mahathir also demanded to know where the 1MDB funds had gone, and who Low Taek Jho, the businessman commonly known as Jho Low, was after more video clips of [Dr M]’s recent recorded interview with bloggers were uploaded on a blog named Din Turtle yesterday. “Who is this Jho Low, who has suddenly become so very important? Dia tak ada jawatan dalam kerajaan (he has no government position), dia bukan (he is not a) civil servant ... suddenly he has such power ... and people tell me, although I cannot say it is proven, that he conducts himself as if he is the government. “Tak berani (you don’t dare to do it), I will ring up the PM ... That was what they said. Whether it is true or not, I don’t know-lah. That is the story,” he said. One clip showed Dr Mahathir saying that “if Barisan Nasional (BN) loses the next general election, the country will see a lot of people paying a big price” in his comments related to 1MDB. “It is very difficult now to do anything. At least a few billion dollars (ringgit) would be lost. I fear that when the opposition wants us to lose, and they will have no sympathy, they will dig. “And when they do, people may be charged in court and found guilty. So if BN loses, this country will see a lot of people paying a big price.” Dr Mahathir said the time for Najib to resign was now when the coalition still had two years to work and recover. “If he doesn’t go now, [and] this PAC (Public Accounts Committee) and others investigate for two [or] three years until the general election and he is still there and we lose, I think there will be a lot of trouble for everyone. “Those who cover up will have to pay a price,” he said. Dr Mahathir has been bashing Najib and his administration in recent months for the 1MDB scandal, continuing the 1Malaysia People’s Aid (BR1M) and the murder of Mongolian translator Altantuya Shaariibuu, and called for the prime minister’s resignation. Last Thursday, Najib gave a special interview on TV3 to address the issues raised by Dr Mahathir, but in doing so he raised more questions. In an earlier video clip on Din Turtle on Saturday, Dr Mahathir said: “We asked about 1MDB, and he said the matter has been referred to the Auditor-General. That is not an answer.” — The Malaysian Insider ‘Umno today is about money’ KUALA LUMPUR: As Tun Dr Mahathir Mohamad comes under fire from the party he led for 22 years, the former president lambasted his critics, saying that Umno now “is about money”. Under the current leadership, Umno is filled with rent-seeking leaders who are loyal only to money, Dr Mahathir said in a video uploaded on the blog Din Turtle on Saturday. The former prime minister’s latest tirade comes as he is criticised by Umno members for causing a rift in the party with his constant attacks against Datuk Seri Najib Razak. “The Umno now is about money. The leaders of Umno are loyal because they get contracts. “The ones who receive posts receive money,” Dr Mahathir said in response to the claim that his criticism was dividing Umno members. Although Dr Mahathir claimed that Najib would bring Umno down, some in Umno had countered that it was his constant attacks against the prime minister that were weakening Umno. “Umno is already split. The Umno that I led was quite powerful. If you looked at the assembly (then), the spirit was there. “The Umno now is about money,” Dr Mahathir said in response to a question that his calls for Najib to resign were splitting Umno between pro-Najib and pro-Mahathir camps. Dr Mahathir has become the face of a movement within the party to oust Najib, who remains a powerful leader and one who is able to command the support of almost all of the party’s grassroots leaders at the division level. Dr Mahathir has called for Najib to resign over his fiscal policy missteps such as the 1Malaysia People’s Aid scheme (BR1M) and 1Malaysia Development Bhd’s RM42 billion debt. He also said that if Najib did not resign, Umno and the Barisan Nasional coalition would lose the next general election. He and Umno veterans such as former finance minister Tun Daim Zainuddin claimed that all the support Najib was getting in Umno was insincere. In the three-minute clip, Dr Mahathir repeated his reasons he thought Najib should resign. “The New Economic Policy (NEP), the Malays being disappointed. It’s very deep (the reasons). They come and see me, ordinary people,” Dr Mahathir said, adding that they complained about Najib’s administration. “[They say] scholarships are hard to get. In the past, you could get them.” He also defended his right to criticise Najib, saying that when it came to national and Malay issues, he had the right to talk about them as he considered himself Malay, even though this had been disputed. “About the country and the Malays, I am here, I am a Malay. Although some people say I am not. Legally, I am Malay. I’ve struggled for this. It is the right of people to reject what I say but it is my right to criticise.” Dr Mahathir was later seen in the video nodding his head to the question on whether as a Malay leader, Najib has failed. — The Malaysian Insider Lee (centre) says the bureau will be organising a trip to Baram, Sarawak in May to support the Baram people in their struggle against the construction of the 1,200mw dam. Photo by The Malaysian Insider / Afif Abd Halim PKR lends support to Baram Dam blockade MIRI: For over a year now, people from 30 villages near the proposed Baram Dam project in Sarawak had taken turns to stand guard at two barricades in their fight against the mega project. Yesterday marked the 536th day the Baram people have stationed themselves at the two barricades — the Long Lama about 142km from Miri city, and Long Keseh about 50km further inland. PKR environmental bureau chief Lee Chean Chung said the party would lend its support to the Baram people in their struggle to protect their homes from destruction. “Our bureau will be organising a trip to Baram from May 10 to 17 to [lend] support and solidarity to the Baram people in their struggle against the construction of the 1,200mw dam,” he said. Lee, who is also the Semambu assembly member, said the project would displace some 20,000 people into resettlement areas. He said the dam when completed, will flood 400 sq km of rainforest, destroy the Baram people’s centuries-old longhouses, the graves of their ancestors, padi fields and orchards. “The Baram Dam is not a standalone issue. It is only one of 12 proposed by the state government to generate power needed to fire its ambitious plan to propel Sarawak into an industrialised and developed state by 2030,” he said. Lee said PKR recognised that Sarawakians had long fought for their environmental rights and justice. Land grabs, forced displacement of natives, deforestation and institutionalised marginalisation of vulnerable residents had been a long-standing issue in the state, he said. “It cannot be improved by merely changing the chief minister and top officials. “A thorough institutional reform, democratisation and change of mindset are required regarding the role of government and the meaning of development. “Therefore, apart from giving moral support, the solidarity trip will also have sharing and empowerment programmes to help us learn from each other about the struggles for environmental justice,” he said. Lee will share experiences from the Stop Lynas Campaign in Kuantan, while other group members share their expertise. He said interested individuals or non-governmental organisations are invited to join the trip and contribute their support for the struggle. — The Malaysian Insider H O M E 15 M O N DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY Six schools to receive RM1.2m for new halls BUKIT MERTAJAM: Six schools in the Permatang Pauh parliamentary constituency will get halls after receiving an allocation of RM200,000 each from the federal government. The construction of the open halls is expected to be completed in three months. Deputy Prime Minister Tan Sri Muhyiddin Yassin yesterday handed over project plans of the open halls to the six schools involved: Sekolah Kebangsaan (SK) Seberang Jaya 2, Sekolah Menengah Kebangsaan (SMK) Pauh Jaya, SK Bukit Indera Muda, SK Permatang Tok Kandu, SK Seri Penanti and SK Mengkuang. He officiated at the opening of SMK Samagagah’s open hall and aid presentation to 15 needy persons here during his one-day working visit to Penang. Meanwhile, Umno Permatang Pauh division chief Datuk Mohd Zaidi Mohd Said said 11 schools in the area had been identified to get new open halls. He said SMK Samagagah was among five schools that already had new open halls being built for RM200,000 each. — Bernama BN to field clean candidate for Permatang Pauh by-election Muhyiddin: Umno division has unofficially submitted several names BUKIT MERTAJAM: Barisan Nasional (BN) will consider all factors — especially a clean record and the acceptance of local residents — in determining the candidate for the Permatang Pauh parliamentary by-election, said Deputy Prime Minister Tan Sri Muhyiddin Yassin. He said the Umno division has unofficially submitted several names as candidates for the by-election and a decision will be made by the party’s top leadership soon. “We consider all factors. What’s important is the acceptance of Permatang Pauh voters. [The candidate] must have a good track record, not involved in any scandal, highly qualified and close to the locals. “Ideally, they (the candidates) should be locals with good track records,” he told a press conference after chairing a meeting with state Umno and BN leaders yesterday. Also present was Umno secre- Muhyiddin: We consider all factors. What’s important is the acceptance of Permatang Pauh voters. Photo by The Malaysian Insider tary-general Datuk Seri Tengku Adnan Tengku Mansor. The deputy prime minister said Umno Permatang Pauh and the state Umno had also expressed their commitment to give full support to the candidate decided by the top leadership. Muhyiddin, who is the director of the Permatang Pauh and Romp- in by-elections, said he would be assisted by Umno vice-presidents Datuk Seri Dr Ahmad Zahid Hamidi in Permatang Pauh and Datuk Seri Hishammuddin Hussein in Rompin. Another Umno vice-president, Datuk Seri Mohd Shafie Apdal, had been appointed as the coordinator of both by-elections, he said. “We will set up a strong strategy for the by-election. We know we are the underdog in the constituency which is said to be a PKR stronghold, but nothing is impossible ... BN’s hopes are to win,” he said. The Permatang Pauh seat has been declared vacant after its incumbent, Datuk Seri Anwar Ibrahim, was disqualified as a Member of Parliament on March 16, after the Pardons Board rejected a petition for a royal pardon sought by the opposition leader’s family over his conviction for sodomising his former aide, Mohd Saiful Bukhari Azlan. The Election Commission set April 25 as the nomination day, early voting on May 3 and the polling day on May 7. In the 2013 general election, Anwar retained the Permatang Pauh seat after defeating BN candidate Dr Mazlan Ismail with a majority of 11,721 votes. — Bernama 16 H O M E M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY Unity council to push for communal relations laws Legislations are to tackle discrimination and set up a harmony commission BY SHERI DA N MAHAV ERA KUALA LUMPUR: New laws to manage communal relations which are supposed to replace the Sedition Act are still relevant even as the government decides to keep the colonial-era law, said a member of the National Unity Consultative Council (NUCC) which crafted the new legislation. Datuk Saifuddin Abdullah said these laws were supposed to tackle discrimination and set up a new commission to deal with ethnic and religious tensions — two elements not in the amended Sedition Act. “There were three aims of the new laws to replace the Sedition Act. The first aim was to criminalise hate speech. This was to directly replace the Sedition Act. “But there are two other aims: to deal with discrimination and to set up a national harmony commission. “The bills for these two other aims can still be pursued and we are moving forward with them,” said Saifuddin. The NUCC was formed in 2013 to find new ways to bridge Malaysia’s ethnic and religious divides. One of its tasks was to propose new laws which can replace the Sedition Act but at the same time, make hate speech a crime. Another NUCC member, Datuk Mujahid Yusof Rawa doubts whether Putrajaya would go ahead with the other two proposed laws since all Saifuddin: There were three aims of the new laws to replace the Sedition Act. Photo by The Malaysian Insider three were meant to be in a package. “They can still incorporate elements from the other two bills but I do not know. We are disappointed because the administration chose to maintain the Sedition Act.” Saifuddin’s comments follow Putrajaya’s U-turn to keep the Sedition Act despite pledging in 2012 to repeal it. Last Friday, the Dewan Rakyat passed several controversial amendments aimed at “strengthening” the act which human rights groups and opposition politicians claimed would stifle free speech. Mujahid said the racial and religious hate crimes bill, which the NUCC proposed and which was supposed to replace the Sedition Act, would have been a better law. “The new law would have set a higher burden of proof to prove that someone was out to create hostility between different communities. “To prove that something is hate speech, you have to prove intent,” said Mujahid, who is also Parit Buntar Member of Parliament and a member of the NUCC’s committee which proposed the new laws. Saifuddin, a former minister, said the new laws would be submitted to Putrajaya in the NUCC’s report by the middle of the year. The law to deal with discrimination would make it illegal to discriminate individuals based on gender, ethnicity, religion, descent, place of birth and disability, he said. Another law would establish a communal harmony and reconciliation commission, which can act as a mediator in cases of communal friction. “This can be fights between neighbours, road rage or even child custody battles between inter-faith couples,” said Saifuddin, adding that the body would be similar to the Malaysian Human Rights Commission or Suhakam. The commission could compel community leaders to appear before the body to tone down public rhetoric and seek to resolve disputes, said Saifuddin, who is also Global Movement of Moderates Foundation chairman. — The Malaysian Insider Non-traditional security threats can jeopardise sovereignty KUALA LUMPUR: The Asean community, especially Malaysians, must understand that non-traditional security threats, if not effectively tackled, can jeopardise national security and sovereignty. Universiti Teknologi Malaysia (UTM) geostrategist Dr Azmi Hassan said it is important for people in this region to understand what is meant by non-traditional security threat as they are unaware that it is rampant in their societies. “Non-traditional security threats are something which are rarely given attention to by society, but if it happens, it can threaten the nation or the surrounding areas, and even create conflicts in relations between nations. “In the Asean context, such as in human trafficking, it is not a problem of national security, but it can threaten the sovereignty and relations between two countries,” he said in an interview recently. Azmi said the intrusions in Lahad Datu, Sabah in 2013 were an example how non-traditional security threats became bloody incidents. “About 20 years ago, the presence of foreigners was not a security threat but now this could disrupt security, resulting in us having to form the Eastern Sabah Security Command.” He said the increase in the number of Malaysians and other nationalities involved in the Islamic State militant group, as they were influenced by ideologies which were supposedly based on religion, was proof of how non-traditional security threats could be prone to extremism. “We can categorise IS as a non-traditional threat, as it is not a formal group, nation or organisation,” he said. Azmi added this was why it was important for Asean to be united to resolve the issue, including sharing intelligence information. Meanwhile, Universiti Utara Malaysia’s Dean of the College of Law, Government and International Studies associate professor Dr Ahmad Marthada Mohamed said Malaysia as chairman of Asean 2015 has an advantage as it is known for unity and harmony in a multiracial society. — Bernama Sedition Act changes intended to choke free flow of information BY V A N B A L AG A N KUALA LUMPUR: Putrajaya is attempting to regulate news portals and other social media users that are critical of the establishment through amendments to the Sedition Act that were approved by the Dewan Rakyat last Thursday, lawyers said. They said the changes were not only intended to check on news articles or commentaries deemed seditious, but also to curb feedback from readers. The lawyers said provisions in the law could be used to remove any information that, in the opinion of the establishment, was against government leaders and organisations. Civil rights lawyer Syahredzan Johan said the amendments were targeted against news portals and Internet users like bloggers, and social media users who provided alternative views and comments. He said the amendment that gave powers to the court to prohibit the circulation of seditious publications was a serious attack against free speech and expression in a democratic society. Vague words such as “likely” and “appears” were relied upon to allow the public prosecutor to convince the courts to remove publications deemed seditious in the electronic media, he noted. “The threshold of what is seditious is low and this is sufficient for the court to allow applications by government lawyers.” New provisions in the law state, among others, that publications that are likely to lead to bodily injury or damage to property or appear to be promoting ill will, hostility, hatred between different races on grounds of religion are seditious in tendency. Syahredzan said in such cases, the court could order the removal of the said material and ban the person making or circulating the prohibited publication from using any electronic devices. Further, the court could order an officer authorised under the Communications and Multimedia Act to remove online seditious materials put up by persons who could not be identified. “This is a major arsenal that the government can utilise and I foresee that news portals will be asked to remove critical comments from its readers and subscribers,” he added. Lawyer Eric Paulsen said the amendments were used as a mask to impose Internet censorship because the government was unable to come to terms with the Internet and social media era. “Unlike newspapers which are licensed, the authorities do not have control over how information is disseminated by the alternative media which are gaining popularity,” said Paulsen, the executive director of Lawyers for Liberty. The government, he said, was going to the other extreme by using excessive means to try to control what could and could not be published. The Institute of Journalists Malaysia (IOJ) also expressed con- Syahredzan: The threshold of what is seditious is low. Photo by The Malaysian Insider cern that the amendment did not specify an expiry date for prohibition orders obtained from the court. “The inability to access tools of the trade will mean online journalists’ careers are at risk and threatens the existence of legitimate news portals,” it said in a statement. It said the prohibition on “propagating” seditious speech or their publication also meant that online news portals could not share allegedly seditious remarks on social media, and Rich Site Summary feeds would cease to exist, further silencing discussion of policies and issues which are of national interest. The situation is further exacerbated by the heavy penalty for first-time offenders who contravene a prohibition order, as they face a maximum fine of RM5,000 or a jail term of up to three years. “This latest curtailment of freedom of expression further restricts public discourse and will create a void in Malaysian social media and a deafening silence in news forums,” said the IoJ. Constitutional lawyer Nizam Bashir said that, via the new Section 10A of the Sedition Act, the court could order an authorised officer to remove articles and comments that were deemed seditious. However, he said amendments to the sedition law appeared inconsistent with Section 3 (3) of the Communications and Multimedia Act, which guarantees no censorship of the Internet, specifically if the authorised officer is attached to the MCMC. Universiti Sains Malaysia Communication Studies Faculty senior lecturer Assoc Prof Mohamad Md Yusoff said the government should consider compelling all Facebook users to register their accounts with the Malaysian Communications and Multimedia Commission . He said the move was better compared with blocking access to the social network websites to prevent abuse by users. However, DAP secretary-general Lim Guan Eng threatened that his party would organise nationwide protests to oppose any attempt to ban or close down Facebook, citing the right for freedom of expression and Putrajaya’s pledge not to censor the Internet. There are 15 million Malaysian Facebook accounts. — The Malaysian Insider H O M E B U S I N E S S 17 M ON DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY WEEK IN FOCUS Photos by Chu Juck Seng, Patrick Goh, Shahrin Yahya, Suhaimi Yusuf & Sam Fong 1 (From left) MCT Bhd non-independent deputy executive chairman Tan Sri Barry Goh, independent non-executive chairman Tan Sri Abi Musa Asa’ari Mohamed Nor and Bursa Malaysia Bhd chief executive officer Datuk Tajuddin Atan at the company’s listing ceremony in Kuala Lumpur on April 6. 2 JOINT PROJECT ... (From left) Deputy Science, Technology and Innovation Minister Datuk Dr Abu Bakar Mohamad Diah, NanoMalaysia Bhd chief executive officer (CEO) Dr Rezal Khairi Ahmad and Nanopac Innovation Ltd CEO Datuk Dr Cheng Kok Leong at the groundbreaking ceremony for Nano Valley and Nano Solar Factory in Behrang, Perak on April 5. The setting up of Nano Valley is the world’s first-ever nanotechnology-based solar research factory. (Seated, from left) K&N Kenanga Holdings Bhd senior executive director Bruce Kho, group managing director Datuk Chay Wai Leong, Tokai Tokyo Financial Holdings Inc president and chief executive officer Tateaki Ishida and Tokai Tokyo Securities Co Ltd adviser to the chairman Datuk Akira Okabe with members of their teams (standing) at the signing of a business cooperation agreement between K&N Kenanga and Tokai Tokyo Financial in Kuala Lumpur on April 9. 3 (From left) UEM Sunrise Bhd acting chief marketing officer Zadil Hanief Mohamad Zaidi, chief financial officer Azhar Othman, Iskandar Regional Development Authority chief executive Datuk Ismail Ibrahim and Cahaya Jauhar Sdn Bhd chief operating officer Mohd Auzir Mohd Tahir at the unveiling of the Gerbang Nusajaya project at Puteri Harbour in Nusajaya, Johor on April 8. 4 1 International Alternative Investment Review (IAIR) group president Guido Giommi (left) presenting Mah Sing Group Bhd executive director Datuk Steven Ng with the best company for leadership property development award (real estate category) at the IAIR awards ceremony in Hong Kong on March 10. 2 5 (From left) Malayan Banking Bhd (Maybank) president and chief executive officer Datuk Abdul Farid Alias, chairman Tan Sri Megat Zaharuddin Megat Mohd and group chief financial officer Mohamed Rafique Merican at a press conference after Maybank’s 55th annual general meeting in Kuala Lumpur on April 7. 3 5 4 6 6 (From left) RAM Holdings Bhd chairman Tan Sri Siti Norma Yaakob, Minister in the Prime Minister’s Department Datuk Seri Abdul Wahid Omar, Standard Chartered Saadiq Bhd chief executive officer (CEO) Adhha Abdullah and RAM group CEO and executive director Datuk Seri Dr K Govindan at the 12th Annual RAM League Awards. Standard Chartered Bank Malaysia Bhd clinched two awards in recognition of its outstanding accomplishments in the Malaysian bond market in Kuala Lumpur on March 27. Abdul Wahid presented the awards. 18 FO CU S M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY T New Oysterflex bracelet reimagines the rubber strap BY SEE film the and Lyk (RM 240 hu wo nev Doing things the easy way isn’t the Rolex way com Eas Du pro the cos 02 BY STEPHEN PULVIRENT R olex doesn’t do anything halfway. When the curtains went up at Baselworld 2015, we were as surprised as everyone else to see a strange rubber strap on the new Everose gold Yacht-Master sitting in the Rolex booth window. Precious-metal sport watches are nothing new for Rolex, but a rubber strap seems almost too cool and under the radar for the brand. We should have known it was no ordinary rubber strap, though. It’s the new Oysterflex bracelet, and it deserves a closer look. Most rubber straps are about as simple an affair as a watch strap can be: two pieces of injection-moulded rubber, one with holes and the other with a buckle at the end. They’re flexible, they don’t get smelly or absorb sweat, and they lend some fake deep-sea diving credibility to those of us who spend most of our watch-wearing days above the surface. There’s really little need to innovate or add anything here, but of course Rolex found ways to make this basic accessory even better. Every Rolex employee I’ve spoken with (along with the pile of marketing material out there) is careful to refer to the Oysterflex as a bracelet and not a strap. Typically, metal links qualify as a bracelet, while a leather, rubber, or fabric band would be called a strap. The Oysterflex is not an injection-moulded rubber strap, but instead a two-piece titanium bracelet with a rubber coating. Yes, that’s both as prosaic and as complicated as it sounds. eve ury wit get mo but 03 04 01. It was most surprising to see a strange rubber strap on the new Everose gold YachtMaster at Baselworld 2015. 01 02. Using a gold Oysterlock clasp is overkill but feels totally appropriate here. The foundation of the Oysterflex is a pair of titanium blades, one on each side of the watch. These are coated in black elastomer (a substance similar to what you’ll find on the Apple Watch) and anchored to the Yacht-Master’s case. Underneath each half is a patented longitudinal cushion system, which is basically a collection of strange rubber flaps with a funny name. They’re supposed to “stabilise” the watch, but more on that later. The solid Everose gold Oysterlock clasp holding the two pieces together seems like overkill, but anything else in this context might feel like a letdown. On the wrist the Oysterflex does have the same rigidity that you’d expect from a metal bracelet but without that cold, silky feeling 03. The Oysterflex bracelet is a far cry from your typical rubber strap. 04. The patented cushioning system is strange-looking but effective. Photos by Bloomberg when you first put it on. I don’t know if I feel like those pads stabilise the watch (whatever that means), but they do allow some air to circulate between the rubber and your skin. A few hours into a hot day this will become your favourite feature, I promise. I thought I’d find the gold clasp annoying and heavy, but it actually balances out the watch nicely, making the whole package feel more complete. There are no two ways about it: The Oysterflex bracelet is one of the most overengi- neered, overly complicated, and probably unnecessary watch accessories ever. But that’s kind of why it’s so awesome. Someone at Rolex headquarters decided a rubber strap might be an interesting idea to think about, and then followed that out to its logical conclusion, giving us a titanium and rubber hybrid that has a patented cushioning system and a solid gold clasp. That’s a kind of thinking I can get behind. — Bloomberg An astronaut’s 18K gold Omega chronograph BY STEPH EN PU LV IR ENT THE Omega Speedmaster beat out the Rolex Daytona and a handful of other chronographs to be Nasa’s official choice for mid-century astronauts. That’s right. Watches. In. Space. Today, many people call the Speedy the Moonwatch because of this. (In Apollo 13, you can see Tom Hanks dramatically fiddling with his to time the events that would bring everyone back home safely.) The watches that actually made it beyond the stratosphere were more modest steel chronos, but this solid 18K gold Speedy Pro was presented to Apollo 12 astronaut Alan Bean once he was back on earth. And now it’s hitting the block. Designed in 1969 to commemorate the first moon landing, only 1,014 watches of this model were ever produced — and this gold Speedmaster Professional is of an even rarer subset, one of 30 given to President Richard Nixon, Vice President Spiro Ag new, and the Apollo 12 astronauts. It’s No 26, to be exact, and belonged to Bean, who MO 01. This 18k gold Omega Speedmaster belonged to an actual astronaut, though it didn’t go to space. ple an the Ma pro tha wo 300 gel hai the as rich sup to b Ne Blu typ mu the aut Lam pri figu line aut lar dev car to t res to r the tru 02. ‘To mark man’s conquest of space with time, through time, on time’. The engraved caseback commemorates when the gift was given. Photos by Bloomberg 01 02 became the fourth person to walk on the moon and later took another trip to space in the early 1970s. The caseback engraving explicitly says that this watch marks “man’s conquest of space with time, through time, on time”. Seriously, it just doesn’t get any cooler than that. The watch itself is quite similar to the steel Speedmasters that went to the moon. Inside is the caliber 861 movement, a slightly less expensive and robust version of the caliber 321 that sat inside Buzz Aldrin’s watch, but it still has the same familiar dial layout and pump-style pushers. The tachymeter bezel is black, but the 18K gold gives the optical illusion of it having a deep burgundy colour, amplified by the blockier hour markers. At 42mm, the watch was absolutely massive for the time, making it particularly well-suited to being strapped over a spacesuit for easy reading on the fly. With an estimate price of between US$40,000 (RM146,400) and US$60,000, this 18K gold Omega Speedmaster is lot 141 in Bonhams’ Space History Sale on April 21. — Bloomberg Th fo Bi 21 FO CU S 19 M O N DAY A PR I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY The beauty and logic of the million-dollar car BY HANNAH ELLIOTT bly But ne rap ut, onhyem nd. o an SEEN Furious 7 yet? You should. Among the film’s hard bodies and the muscled engines, there’s a sexy little number that stands head and haunches above the rest: It’s called the Lykan HyperSport. The car is a US$3.4 million (RM12.44 million) beast with a top speed of 240mph (386kph) and the face of a raptor. The huge audiences who saw the movie recently won’t soon forget it — even if they’ll likely never see the vehicle in real life. The Lykan is the first supercar made by a company (W Motors) based in the Middle East (formed in Beirut, with headquarters in Dubai). It’s also among the most expensive production cars ever to go on sale. But it’s not the only land rocket to come out lately that costs more than a million dollars. Far from it. Over the past decade we’ve seen almost every automaker (that calls itself a true “luxury” brand, at least) produce a contraption with a seven-digit price tag. Sometimes, they get there only by making a one-off with diamond-rimmed headlights and titanium bones, but they get there. The brands make these cars because people buy them. The past few years have seen an explosion of royals and tycoons around the globe who buy the entire fleet of Aston Martins and Lamborghinis to support their proclivities. Bloomberg has discovered more than three dozen new billionaires in the world since January alone, and more than 300 since 2012. They buy the cars in Los Angeles, Doha, Moscow, Sao Paulo and Shanghai. Some, like hotel tycoon Steve Wynn, buy them to bolster their business interests just as much as their personal life. For them, it’s not that big a deal. “The fact of the matter is there are a lot of rich people around the world, and I mean super rich — hundreds of millions of dollars to billions of dollars of net worth,” says Jack Nerad, executive market analyst for Kelley Blue Book. “When you’re talking about these types of people, a million-dollar car isn’t really much of a stretch at all.” It’s also lucrative for the carmakers, despite the extra work required to specialise in a given automobile. Margins on a standard Ferrari or Lamborghini hover around 15%, and when the price tag on a particular car reaches into seven figures, that amount can increase significantly. If you have to set up a separate assembly line, it can become expensive to produce an automobile, Nerad says. “But with million-dollar cars, there’s still money to be made.” The basic rule is that it takes US$1 billion to develop and produce a normal mass-market car. But developing one that’s not accessible to the public can cost less than that because resource needs are narrowed. Plus, it’s easier to recoup the expense when price tags are in the millions rather than, say, US$30,000. That’s true even if a company sells only 300 cars. Lamborghini made three Venenos to celebrate its 50th birthday -— and the supercar is fittingly named after one of the most famous, most aggressive Spanish fighting bulls. Each has a V12 engine and 740 horsepower, with a top speed of 221mph and a paint job recalling the Italian flag. Price: US$4 million. Photos by Bloomberg The Lamborghini Sesto Elemento V10 coupe premiered at the 2010 Paris Motor Show. It has a six-speed semi-automatic transmission and a 0mph to 60mph sprint of 2.5 seconds. Fast, yes -— but it comes without a radio or air conditioning. Price: US$2.2 million. The Porsche 918 Spyder hybrid will hit 60mph in 2.6 seconds and has a top speed of 210mph. It comes with a V8 engine paired with lithium ion electric batteries. Base models start at US$845,000, but upgrades push the cost up much higher. The Koenigsegg Regera hybrid is the company’s latest model. It has a twin-turbo V8 engine paired with three electric motors for a total combined output that’s the equivalent of 1,489 horsepower. Top speed is 249mph; only 80 will be made. Price: US$1.9 million. The Lykan HyperSport premiered at the International Dubai Motor Show in 2013. Top speed is 239mph, with a 0 to 60 sprint time of 2.8 seconds. The car is rumoured to have diamond and titanium accents in its headlights. Price: US$3.4 million. These super expensive cars fall into different categories. Some, like the Bugatti Veyron and Lyons Motor Car’s LM2, are truly unique and made in minuscule production numbers. Others are special editions of existing models. Let’s look at how a Rolls-Royce gets to a million dollars. A base-level Phantom starts at about US$400,000. Then you add custom treatment, which most of them receive: That’s special wood, paint, and leather that can hike the price by hundreds of thousands of dollars. Getting the full-armoured treatment on a sedan can cost almost half a million dollars alone. And at that point the real heavyweight treatment starts: true bespoke, one-of-one work that adds precious gem and pearl accents, hand-stitching, bullet-proofing, theatre systems and elite engine tuning. That last stage is where a standard Phantom crosses the million-dollar threshold. “The trend is growing, and it’s driven by bespoke cars like our Serenity,” says Gerry Spahn, Rolls-Royce’s head of communications, referring to the US$1.5 million Phantom it introduced last month in Geneva. You can probably get speed or strength or comfort in such an expensive car, but not all three. Then there’s what automakers call a “halo car”. That’s when a brand that makes several different lines comes out with a concept car or ultra high-end superstar that serves a purpose beyond its own price tag. In fact, the indirect monetary benefits of making a halo hypercar are usually more important than direct profit. High-profile products can make the entire brand shine like a backlit Hope Diamond -— the brilliance associated with the crown jewel car inevitably rubs off onto the less expensive offerings in the fleet. If the cachet is compelling enough, it will deliver cash. Finally, some automakers don’t want to persuade a broader market to buy their cars. Ultra-niche supercar companies such as Koenigsegg, Zenvo, and the aforementioned Lykan make limited runs of cars whose price tags can soar into the multimillions. They’re selling only to the super rich, and in those cases the exclusivity is a big part of the draw: You can’t drive these cars except on a track, but that’s okay, because no one else can drive them at all. These efforts are often a gamble — high risk, and not always high rewards. Zenvo, in Denmark, will make only 15 of its US$952,000 ST1 supercars. They’re betting that the top speed of 233mph and 1,104 horsepower will help them sell through the line, at which point the owners estimate they’ll break even. But before the Geneva Motor Show this year, the company had delivered only two and received orders for five more. Then it’ll be a few years before Zenvo can roll a new model off the production floor — a time period when bigger automakers can accomplish all kinds of feats. Or consider the US$2 million Pagani Zonda, which has a certain flair but has endured persistent criticisms about its high maintenance costs and propensity to break down under even the slightest inclement conditions. “Exotic cars are fairly unpractical,” says Cars.com’s Mays, in the understatement of the week. “You need a whole garage of things to drive when you own one of these — things that are a bit more rugged. With something like a Pagani, you need real roads and, ultimately, racetracks to stretch its legs.” Of course, if you’re wealthy enough to afford something like the Pagani, you’re wealthy enough to afford the racetrack that goes with it. — Bloomberg by n’s iar The old eep ckiwas g it ped fly. en 00, 141 pril The Maybach Exelero was introduced in 2004 and even then was notable for its extremely high price and famous reputed owner (the rapper Birdman; it also appeared in the Jay Z music video Lost One). Top speed is 218mph, and it can hit 60mph in 4.4 seconds. Price: US$8 million. The Lyons Motor Car LM2 Streamliner. Price: US$1.3 million (estimated). Photos by Lyons Motor via Bloomberg The Aston Martin One-77 was unveiled in Paris in 2008 as the British automaker’s most expensive offering to date. It has a V12, 750-horsepower engine, and only 77 were made. Price: US$1.7 million. 22 C O M M E N T M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY Britain in political turbulence Broadcast debate proves meltdown of two-party system BY JOHN LLOYD L ast week in Britain, four men and three women faced the cameras in a broadcast debate that not only marked the start of a crucial election campaign but also served as proof of the meltdown of what had been one of the world’s most stable two-party political systems. The plethora of parties vying for representation in the mother of Parliaments may bring about the mother of all political turbulence. The candidates are plunging Britain into an uneasy time that will only become more intense after the May 7 vote. There is no avoiding it, with one exception — the men representing parties that have existed for a century — the Labour Party, led by Ed Miliband, and the Conservative Party, led by Prime Minster David Cameron. The Liberal Democratic Party, led by Deputy Prime Minister Nick Clegg, is the heir to the 19th-century Liberals. The exception is Nigel Farage, leader of the United Kingdom Independence Party founded 12 years ago. The women are the real radicals. Nicola Sturgeon, new leader of the Scottish National Party, is a Scot; Leanne Wood of Plaid Cymru, the party of Wales, is a Welsh; and Na- talie Bennett of the Green Party is, surprisingly, an Australian. The first two want to break up Britain by taking Scotland or Wales out of the union. Bennett wants “a radical transformation of society for the benefit of all”, which would mean low or no growth. All are hostile to “austerity”, the economic policy followed throughout Europe that focuses on reducing national budget deficits through a mixture of public-sector cuts and tax increases. The three main party leaders represent the great forces of the 20th century, a century in which Britain started out as the motherland of the largest empire the world had seen — and ended with Britain still rich and of some importance but no more geographically than two islands off the west coast of Europe, one of which is also occupied by another state, Ireland. The Liberal Party governed before World War I and faded rapidly thereafter. Since then, the Conservatives and Labour managed the transition from grandeur to normalcy. The forces they represented (never exclusively) — the professional, commercial and employing classes versus organised labour and the intelligentsia, broadly defined — were never in danger of rebelling against each other. In the past few decades, all classes demanded of both these Cameron emphasises, banking on Miliband’s relative unpopularity, that only one of the two can become the prime minister. Photo by Reuters parties roughly the same things — increased consumption, continuously-socialised medicine, education and social care, more-or-less free markets, free press and free speech, and a secular state. Britain, like other states, thinks it is special. So it is. At the same time, it is very much like the other peaceful, rich states of Western Europe. The other four people who faced the cameras challenged much of that. For Sturgeon and Wood, the 20th century was a loss of external imperial rule and a strengthening of internal imperialism over the other nations of Britain. “London rule” is the common bogeyman. It conjures up an image of a capital divorced from the reality of Welsh valleys or Scottish lowlands, both scarred by the 19th-century in- dustries that had fuelled the empire. Farage of the UK Independent Party has two main arguments. One, there are too many immigrants in Britain and their number must be sharply reduced to roughly 30,000 to 50,000 a year. Two, Britain must leave the European Union. Farage has many fans across Britain, especially outside London. Though his party has faded since winning the largest vote in the 2014 European Parliament elections, it may take some seats in the May vote, which will defy the British bias that the first past the post-electoral system presents for all new parties. Meanwhile, Cameron and Miliband see each other as major enemies. Cameron emphasises, banking on Miliband’s relative unpopularity, that only one of the two can become the prime minister. However, both are conscious — more than any of their predecessors in the past 100 years — that the basic offerings of their parties are peeling and flaking off. Consider this: the Conservatives’ full name is the Conservative and Unionist Party. In contrast, the insurgents, especially in Scotland, have the wind at their backs. Labour, as its name proclaims, should be hostile to an austerity policy that hits the poor and working classes hardest, but it can’t afford to be seen as reckless or insouciant about debt, or destructive to the relatively healthy economic growth that the Conservatives have managed to encourage. Clegg has struggled to convince his followers that his small party’s participation in the government over the past five years has made the country more liberal or, indeed, more democratic. However, the great causes of the Liberals have long been absorbed into left and right policies. Cameron, Miliband and Clegg are in the same moderate boat. They face four who see radicalism as their best trick. All seven are trying to navigate currents already treacherous for parliamentary rule, including social media and the Internet, the rise of new powers like China and India, and the decline of the environment carved into the measured decorousness of the old representative democracies. — Reuters American leadership in a multipolar world BY PAOL A SU B ACCHI GIVING up the spotlight is never easy. The United States, like many ageing celebrities, is struggling to share the stage with new faces, especially China. Upcoming meetings of the International Monetary Fund (IMF) and the World Bank — two institutions dominated by the US and its Western allies — provide an ideal opportunity to change that. The US must come to terms with the reality that the world has changed. The longer the US remains in a state of denial, the more damage it will do to its interests and global influence, which remain substantial, if more constrained than before. The world no longer adheres to the static Cold War order, with two blocs locked in open but guarded confrontation. Nor does it work according to the Pax Americana that dominated in the decade after the Soviet Union’s collapse, when the US briefly emerged as the sole superpower. Today’s world is underpinned by a multipolar order, which emerged from the rise of developing economies — most notably China — as major actors in trade and finance. The US — not to mention the other Group of Seven countries — now must compete and cooperate not only with China, but also with India, Brazil and others through expanded forums like the Group of 20. To this end, the US must show leadership and adaptability. It cannot refuse to support China’s efforts to expand its role in global governance. Nor should it issue harsh rebukes to its allies when they do not follow suit, as it did when the United Kingdom announced its intention to join the new China-led Asian Infrastructure Investment Bank (AIIB). The US seems to be stuck in the Bretton Woods system, the rule-based order — underpinned by the IMF and the World Bank, with the US dollar at its heart — that emerged after World War II. The Bretton Woods system institutionalised America’s geopolitical supremacy, leaving the old imperial power — the UK — to step aside, a step that it took graciously — if a little desperately — given its grave postwar economic situation. Over the years, however, the Bretton Woods system, with its mix of liberal multilateralism and market-oriented economic policies, has come to symbolise the Anglo-American dominance of the global economy that much of the world now criticises, especially since the global financial crisis. In particular, the Washington Consensus — the set of free-market principles that influences policies of the IMF, the World Bank, the US and the UK — has generated considerable resentment, especially after the Asian financial crisis in the 1990s. Against this backdrop, it is hardly surprising that China uses its growing global influence to help engineer a new economic order — one in which the US dollar does not reign supreme. Zhou Xiaochuan, the governor of China’s central bank — the People’s Bank of China — has repeatedly called for a shift towards an international monetary system that allows the use of multiple currencies for payments and investments. Such an approach would reduce the risk and impact of liquidity crises, while decoupling the international monetary system from “economic conditions and sovereign interests of any single country”. Of course, China believes that its own currency — the yuan — should eventually play a central role in this new monetary system, so that it reflects China’s role not only as a leading engine of global economic growth, but also as the world’s largest creditor. Indeed, together with other systemically important economies — the US, the UK, Japan and the eurozone — China drives trends that, for better or worse, extend far beyond its borders. Since 2009, China’s leadership has been pursuing a set of policies that encourage the use of the yuan in regional trade and reduce its dependence on the US dollar in international payments. However, expanding the yuan’s role in the international monetary system is just the first step towards institutionalising a multipolar world order. China has also spearheaded the establishment of new multilateral institutions, with the AIIB following on the heels of the New Development Bank — created with other major emerging economies, including Brazil, Russia, India and South Africa. By taking these steps, China’s leaders have called attention to the inadequacy of the existing international monetary system — and its institutional framework — in today’s complex, multipolar world economy. In particular, China’s agenda highlights questions about America’s capacity to provide the needed liquidity to support international trade and finance. To be sure, the US is right to wonder whether the new order — that China hopes to build — will be as open and rule-based as the American-led order, the one that gave China the market access it needed to achieve its spectacular economic rise. However, the answer to that question can be found only by engaging China on the issue of global governance reform — not by denying that change is needed. As the US stubbornly pursues a policy of containment towards China — exemplified in its fight against the AIIB’s establishment, its relentless accusations of currency manipulation and its refusal to ratify IMF reforms that would increase China’s influence — it risks losing its ability to shape what comes next. The result could be a world of fragmented blocs, an outcome that would undermine not only global prosperity, but also cooperation on shared challenges. Spring Meetings of the IMF and the World Bank offer an important opportunity to signal a new approach towards China. There is no signal more credible than US support for the yuan’s addition to the basket of currencies that the IMF uses to value its international reserve assets — the Special Drawing Rights. America will be in the spotlight once again, but how will it perform? — Project Syndicate Paola Subacchi is the research director of international economics at Chatham House and a professor of economics at the University of Bologna. W O R L D B U S I N E S S 23 M ON DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY Hong Kong stock boomlet tests China’s capital dam BY JOHN FOL EY BEIJING: If the man-made dam that separates China’s financial markets from the rest of the world were removed, which way would the money flow? The sudden boom in Hong Kong’s stock market, driven by mainland Chinese money and the promise of more to come, should leave no doubt. The answer is out — and at considerable speed. Hong Kong’s benchmark stock index rose as much as 6.4% on April 9, a day after Chinese investors maxed out their quota on a cross-border investment scheme launched five months ago. The rush is hard to square with actual events. True, China’s regulators on March 27 said the mutual fund industry, with 4.4 trillion yuan (RM2.6 trillion) of assets at the end of 2014 according to Z-Ben Advisors, can now participate in the Shanghai-Hong Kong Stock Connect. But it’s unlikely many have. Tweaking paperwork could take weeks. A new fund product requires around 20 days to get ready, Z-Ben estimates. Perhaps investors have just got wise to the gulf between Shanghai and Hong Kong stocks. Shares in Shanghai Electric Group, one of the more popular trades, used to cost 69% less in Hong Kong two weeks ago; now the gap is 47%. But that is not new. And the stocks aren’t yet interchangeable — though the Hong Kong exchange is considering a way to create something like substitutability, people familiar with the situation say. Most likely, the cause of the rally is simple speculation on the wall of money bursting to get out of the mainland, some of it fuelled by leaked funds already sloshing around in Hong Kong. That makes it problem- IN BRIEF atic. The previous slow start to the Connect scheme was reassuring for regulators on both sides who wanted to avoid the perception they are promoting market manias. The latest surge may actually slow progress towards further opening up. For now the dam is secure, at least as far as the Connect scheme goes. But predicting what happens when it is eventually dismantled must be keeping China’s planners awake at night. Pressure is building, and in the People’s Republic where there’s a will, there is always a workaround. — Reuters Commodity giants’ S’pore trading hubs under fire But companies deny any improper transfer pricing BY RAC H EL A RMST RONG SINGAPORE: The Singapore trading hubs of the world’s largest commodity companies are coming under scrutiny from the governments of some resource-producing countries who say they suspect they are using units in the Southeast Asian financial centre to avoid tax. Some of the world’s largest oil, mining and soft commodity companies book billions of dollars of revenue in the tiny island state every year, where tax rates can be very low, which is perfectly legal unless they deliberately underprice group China-led AIIB will be lean, clean and green BEIJING: The China-led Asian Infrastructure Investment Bank (AIIB) will be lean, clean and green, its interim chief said, playing down concerns about transparency and standards governing the institution. The US$50 billion (RM183 billion) bank, expected to start operations by the end of the year, is attracting a growing list of countries, from Britain to India to New Zealand. The AIIB is seen as a potential rival to established lenders the World Bank and Asian Development Bank, which are dominated by the United States and Japan. “Lean is cost effective; clean, this bank will have zero-tolerance on corruption; green means it’s going to promote the economy,” China’s Xinhua news agency quoted Jin Liqun, secretary-general of the bank’s multilateral interim secretariat, telling a forum in Singapore on Saturday. — Reuters transactions so as to shift profit there from units in other countries. The companies deny any improper transfer pricing and say they are in Singapore to be closer to Asian clients, to local expertise and trade routes, as the region accounts for a growing share of their business. The world’s two largest miners, BHP Billiton and Rio Tinto, between them booked close to US$50 billion (RM183 billion) in revenue in Singapore in 2013, according to documents from the country’s corporate registry, and posted a combined net profit of more than US$2 billion. They mostly conduct trading operations there, a high-volume, low-margin business that involves buying up commodities from their global operations and selling them to clients. They also look after logistics and risk management. The companies say their Singaporean operations were not set up to cut tax but to serve their clients better. Australia and Indonesia’s tax authorities say they are investigating whether arrangements like these simply shift profits away from where the commodities are extracted. Most jurisdictions require such arrangements to have a commer- cial purpose beyond saving tax, and the group transactions should be conducted at arms-length pricing. Australia and Indonesia both rely heavily on mining exports and count global miners among their biggest taxpayers. Australia’s tax office has said it is conducting audits of 15 marketing hubs in Singapore and Switzerland that it says it expects will raise an extra US$1 billion. It has not identified the companies involved, although BHP and Rio told an Australian Senate hearing last Friday that their Singapore units were being audited. — Reuters Experts: India, France jet deal may fuel trade partnership BY ABHAYA SR I VAS TAVA NEW DELHI: India’s multi-billion-dollar deal to buy 36 fighter jets from France will cement strategic political ties between the two countries at a time when both are looking to kick-start their economies, experts say. Indian Prime Minister Narendra Modi, in his first trip to France, said last Friday he had ordered the 36 “ready-to-fly” Rafale jets as part of a push to modernise his country’s ageing warplane fleet. The announcement put to rest intense speculation over the fate of the contract, which was first signed in 2012 but had been bogged down by questions of cost and New Delhi’s insistence on assembling a portion of the high-tech planes in India. It also comes as Modi is seeking to curry up interest from investors during his maiden trip to Europe, where he is seeking to rewrite India’s reputation as a tricky place The Rafale fighter jet Length: 15.27 m Wing span: 10.80 m Empty weight: 10 tonnes Maximum speed: Mach 1.8 (2,170 kph) Service ceiling: +16,700 m Uses: interceptions, attacks on land and sea targets, nuclear strikes, reconnaissance Propulsion: 2 SNECMA M88-2 engines to do business. “Such major deals are never purely commercial, they are a part of a larger government strategy,” Mrinal Sumant, a retired army major general and procurement specialist, told AFP. “It’s a decision based on the geopolitical and strategic interests SINGAPORE: The investment outlook for both equity and fixed-income asset classes continues to be positive, according to a report by UOB Asset Management (UOBAM), The Straits Times reported. “Improving global economic growth in 2015, combined with low inflation and supportive monetary policies, will lead to a year of moderate performance distributed broadly and similarly across most regions,” it said. UOBAM noted that there is still “very low inflation” last Friday, with policies such as quantitative easing programmes being implemented across the world to stimulate money supply and global liquidity. — The Straits Times Tee International third-quarter net profit plunges 76.5% SINGAPORE: Tee International, a mainboard-listed engineering and property firm, reported last week a 76.5% plunge in third quarter net profit, to S$133,000 (RM356,227), The Straits Times reported. Revenue for the three months to Feb 28 rose 15.5% to S$43.1 million, from a year earlier, owing to higher revenue for ongoing engineering projects. Cost of sales also increased by 19.2% to S$37.3 million. Gross profit fell 3.8% to S$5.8 million. Other operating income fell 10.6% to S$995,000, owing to lower interest income from associated companies. — The Straits Times China super-rice grower blames weather, fungus for harvest failure BEIJING: China’s super-rice grower, Yuan Longping HighTech Agriculture Co Ltd, blamed abnormal weather and disease for large crop failures in the rice growing province of Anhui last year. Rice blast fungus caused a reduction in yields or no harvests in many areas in the province, said an executive with the company founded by Yuan Longping, an agricultural scientist who is sometimes referred to by Chinese media as “the father of hybrid rice”. — Reuters Pakistan to raise more than US$1b via Habib Bank sale Flight autonomy: 3 hours Range: 1,850 km Source: Dassault ‘Positive’ outlook for equity and fixed-income asset classes Photo: Karim Sahib of the two countries.” India, which has long been the world’s largest buyer of defence equipment, is in the midst of a multibillion dollar upgrade of its Soviet-era military hardware in the face of antagonistic neighbours Pakistan and China. — AFP KARACHI: Pakistan will raise more than US$1 billion (RM3.66 billion) by selling its entire stake in Habib Bank Limited, a government official said on Saturday, a deal that will be the country’s biggest privatisation so far. The government will sell its 42.5% stake in Pakistan’s biggest bank at 168 rupees (RM6.05) per share after a successful book-building exercise last week, Mohammad Zubair, the chairman of the privatisation commission, said. — Reuters 24 W O R L D B U S I N E S S M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY ‘Greece’s list of reforms wanted by April 20’ FRANKFURT: The European Union has given Greece until April 20 to present a list of reforms which, if found acceptable, would unlock the final tranche of aid funds promised under a multibillion euro bailout, a German newspaper reported yesterday. Eurogroup ministers have set the Greek Church offers up property to help Athens raise funds for debt ATHENS: The head of Greece’s Orthodox Church said on Saturday it was willing to put property it owns up for development to help raise money to repay the country’s debt. The Orthodox Church is a powerful institution in Greece and owns more land than anyone except the state, including prime real estate in Athens. “Come, let’s develop [the property] for Greece,” Archbishop Ieronymos of Athens told Greek TV in an interview during the Greek Orthodox Easter holiday. Asked if the Church would consider selling off property, he said: “No, I would say let’s work together and [the state can] use the revenues to repay all its debts ... but the plots of land will remain Greek, in Greek hands.” He did not say what kinds of business developments he had in mind. It is unclear how much property the Church owns as its structure is decentralised and Greece has no central land registry. Greece has teetered on the verge of bankruptcy since its debt crisis broke out in 2009 and has depended on rescue loans totalling €240 billion (RM930.97 billion) from the European Union and International Monetary Fund to stay afloat. While an integral part of Greek society, critics say the Church owns too many assets, pays too little in taxes and has failed to contribute its fair share as ordinary Greeks’ bills have soared during the economic crisis. — Reuters deadline in order to have sufficient time to examine Athens’ proposal ahead of a meeting on April 24, the Frankfurter Allgemeine Zeitung reported, quoting unnamed representatives in the negotiations. Negotiators from Greece and the EU have struggled to make head- way over the final payout of €7.2 billion (RM27.9 billion) as Athens has refused to consider cutting civil servants’ pensions. Alexis Tsipras’s government, which was elected on an anti-austerity ticket, is reticent about accepting further cuts in public spending. Rather, it is looking at raising national revenues through improving tax compliance. Last Thursday, the Greek government also began examining a draft bill aimed at rehiring around 4,000 civil servants who were retrenched due to austerity reforms. — AFP New economic order, says USDA US will just barely remain global leader, China’s GDP to double BY JEANNA S M I ALE K WASHINGTON: Get ready for a new economic order. In the world 15 years from now, the United States will be far less dominant, several emerging markets will catapult into prominence, and some of the largest European economies will be slipping behind. That’s according to the US Department of Agriculture’s (USDA) latest macroeconomic projections that go out to 2030, displayed in the chart as shown. The US will just barely remain the global leader, with US$24.8 trillion (RM90.77 trillion) in annual output. The gray bar represents the US$16.8 trillion gross domestic product projected for 2015, and the green bar shows how much bigger the economy is expected to be 15 years from now. The country, worth 25% of the world economy in 2006 and 23% in 2015, will see its share decline to 20%. China’s gross domestic product will grow to more than twice its size today, helping the Asian powerhouse to almost entirely close its gap with the US India, ranked eighth for 2015, will climb past Brazil, the United Kingdom, France, Germany and Japan to take third place in the world ranking. The country will have the largest workforce in the world within the next 15 years, the International Monetary Fund notes, and among the youngest. Other nations won’t be so lucky, particularly among developed MADRID: Royal Dutch Shell sat out previous waves of energy consolidation. Now the Anglo-Dutch major has struck the first mega deal of the latest oil rout. Paying US$70 billion (RM256.2 billion) for smaller, gas-focused rival BG looks like a smart and opportunistic way to boost growth. Shell admits eyeing BG for years. The deal looks well-timed: a series of profit warnings and management changes made BG vulnerable, with new chief executive Helge Lund only taking over in February. At first glance, though, this looks better value for BG shareholders. A fat 50% premium equates to a total mark-up of nearly US$23 billion. That outstrips planned annual savings of US$2.5 billion: taxed at BG’s 37% rate and capitalised at 10 times, these would have a net present value of closer to US$16 billion. However, there may be plenty of extra savings that Shell has not Wal-Mart says Walton family to sell shares to keep lid on stake BENTONVILLE (United States): Wal-Mart Stores Inc said the Walton family was putting 6% of the retailer’s outstanding shares in a newly formed trust for possible sale to offset expected increases in its stake due to stock buybacks and to help fund charitable contributions. The amount of stock set to go into the trust is worth US$15.6 billion (RM57.1 billion) at the current price. The Walton family, which founded the company, owned 50.86% of Wal-Mart’s stock as of Dec 31. In a statement, the company said it had been informed by the family that it planned to sell shares “from time to time” to ensure its stake does not increase as a result of the company’s stock repurchase programme, and to finance investments in charity. — Reuters Canada’s Bombardier looks to raise cash from rail business — sources economies. Japan, which was a roaring economy until its asset bubble burst in the early 1990s, has already slogged through decades of stagnation and will likely continue to see very little growth over the next 15 years. That will push Japan down a spot in the rankings by 2030, according to the USDA estimates. Japan is “an important lesson in how quickly you can downshift your status of what a structure of an economy delivers,” said Bruce Kasman, JPMorgan’s chief economist. France will slide three spots, while Italy drops two. In the overall ranking, Jamaica will surrender the most ground, bumping down 13 places to 136. Countries with the biggest advances — like Uganda, which will climb 18 spots to rank 91 — are concentrated in Africa, Asia and the Middle East. The USDA is not the only — and hardly the most widely-followed — ranking of global economic growth, though it does offer the advantage of particularly long-term outlooks. — Bloomberg Shell could win from bold US$70b swoop on BG BY FI ON A MA H A RG-BRAVO IN BRIEF quantified yet. And BG’s depressed share price might overstate the real premium — the stock has plunged 28% in the last nine months. Moreover, the strategic argument is compelling. BG will boost Shell in two complementary areas: Brazilian deepwater assets and liquid natural gas. Shell, which has a lacklustre reserve replacement ratio compared to peers, will see production lifted by 20%. As ever with mega deals, much depends on execution and keeping costs down. Given BG’s recent troubles, this may not be straightforward, although the company’s capital commitments are falling as it completes large projects. There is also an in-built optimism behind Shell’s move. BG will add to cash from operations in 2016 and will be strongly accretive to earnings per share from 2018, Shell says. But it is assuming that by then Brent crude has recovered to US$90 a barrel, some 50% higher than today’s price. If it doesn’t, Shell will need to find a sharper axe. — Reuters LONDON: Bombardier Inc is exploring a possible sale of all or part of its railway business, which bankers value at up to US$5 billion (RM18.3 bilion), among options to pay for huge cost overruns in its aircraft business, sources familiar with the matter said. The Canadian company is working with banks on strategic options for its transportation arm including a possible initial public offering , three sources said last Friday. A merger with peers such as Germany’s Siemens or France’s Alstom could also be considered, one of the sources said, pointing to a tie-up between China’s biggest train makers CNR and CSR Corp last year that put pressure on rivals to gain scale. — Reuters Spotify said to seek financing to value music site at US$8b NEW YORK: Spotify Ltd is in the process of raising new financing that would value the largest subscription music-streaming service at about US$8 billion (RM29.28 billion), according to people familiar with the matter. That valuation is double what the company was worth when it raised money in November 2013. The latest round totals about US$400 million, according to one of the individuals, and comes from a group that includes Goldman Sachs Group and an Abu Dhabi sovereign wealth fund, the Wall Street Journal reported last Friday. — Bloomberg Toyota to build plant in China — reports TOKYO: Toyota is planning to build a new plant in northern China as the world’s top automaker ramps up investment after a two-year freeze, reports said on Saturday. Proposals for the plant in Tianjin should be finalised by the summer, Jiji Press and Kyodo News agency reported. — AFP W O R L D 25 M O N DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY Police: Man shoots, kills self near US Capitol BY ST EPH EN D OCKERY WASHINGTON: A man holding a protest sign shot and killed himself on Saturday near the steps of the US Capitol at the height of tourism season in Washington, triggering a brief lockdown of the congressional building. Police said the man had a “so- Iran cannot be trusted, Netanyahu warns JERUSALEM: Israeli Prime Minister Benjamin Netanyahu kept up his assault on the framework nuclear deal between world powers and Iran, warning late Saturday that the Islamic republic could not be trusted. It was the latest attack on the emerging deal under which Iran would curtail its nuclear activities in exchange for relief from punishing economic sanctions. Following marathon talks in the Swiss city of Lausanne, the negotiators agreed on a framework deal on April 2, which Israel has repeatedly denounced as an “historic mistake”. “To my regret, all of the things I warned about vis-avis the framework agreement that was put together in Lausanne are coming true before our eyes,” Netanyahu said. “This framework gives the leading terrorist state in the world a certain path to nuclear bombs,” he warned. “How can such a country be trusted?” The emerging deal, which is to be finalised by June 30, would leave Iran with “significant nuclear capabilities,” he said. “It is not dismantling them, it is preserving them. We also see that the inspection is not serious... as of now, there is no monitoring,” he added. “We see that the sanctions are being lifted, immediately, according to Iran’s demand, and this is without Iran having changed its policy of aggression everywhere.” — AFP cial justice” protest sign with him when he produced a weapon and shot himself on the western side of the building in the afternoon. US Capitol Police chief Kim Dine said no shots were fired by police. His force investigated a backpack and case the man had with him before reopening the legisla- tive building and its visitor centre. Dine said the shooting was not terrorism-related, declining to comment further on the man’s identity or his motive pending an investigation. The FBI, Secret Service and local police are investigating the shooting. “We potentially know who he is but obviously we have to secure that and verify it,” Dine said. Washington is in the middle of one of its peak tourism seasons as visitors flock to view the city’s famous cherry blossoms. The shooting took place just after 1.00pm (1700 GMT) and the lockdown ended nearly three hours later. — AFP Obama back in Washington Describes meeting with Castro as ‘candid and fruitful’ PANAMA CITY: US President Barack Obama arrived home late Saturday, just hours after unprecedented face-to-face talks with Cuban President Raul Castro and a first meeting with Venezuelan President Nicolas Maduro. Obama characterised his meeting with Castro — the first sitdown between leaders of both nations since 1956 — as “candid and fruitful,” while the White House said the US leader voiced support for a peaceful dialogue between Venezuela’s government and the opposition during brief talks with Maduro. The historic talks in Panama, on the sidelines of the Summit of the Americas, came after Obama and Castro announced in December that they would move to normalise ties between the United States and communist Cuba after more than a half-century of animosity. Obama faced stinging criticism on his return to the US capital, with Senator Ted Cruz, a Cuban-American Republican candidate in the 2016 presidential race, accusing him of “caving to a communist dictator in our own hemisphere”. On another note, Obama said Hillary Clinton would make a fine US president, he told reporters on Saturday, on the eve of the expected launch of her candidacy for the Democratic Party’s nod in 2016. SUMMERVILLE (United States): Hundreds mourned on Saturday at the funeral of an unarmed black suspect gunned down in a “disgraceful” shooting by a white officer, an episode that has raised questions about race and excessive force in the United States. Walter Scott, a 50-year-old father of four, was shot five times in North Charleston, South Carolina after fleeing a routine traffic stop while a bystander caught the event on video. Scott’s body arrived at Word Ministries Christian Center, where Obama beat Clinton — who is vying to be the first woman president of the United States — for their party’s nomination in 2008 after a gruelling campaign. “She was a formidable candidate in 2008. She was a great supporter of mine in the general election. She was an outstanding secretary of state. She is my friend,” Obama said at the regional summit in Panama. Several US media reports, citing sources in Clinton’s campaign team, said the 67-year-old was to announce her candidacy for the Democratic nomination yesterday. — AFP NAIROBI: One Kenyan student died and more than 100 others were injured after an exploding electricity transformer caused a stampede yesterday, in a sign of high tensions a week after gunmen stormed another university campus, officials said. The student who died was among others who jumped from as high as five floors up, fearing the University of Nairobi’s Kikuyu campus had come under attack, university vice-chancellor Peter Mbithi told Reuters. Gunmen from the al- Qaeda-aligned group al-Shabaab stormed Garissa University College, about 200km from the Somali border, killing 148 people on April 2. — Reuters Malta referendum extends spring bird hunting exception VALLETTA: Hunters on the Mediterranean island of Malta have won a referendum to let them continue to hunt migrating birds in spring, a centuries-old tradition not allowed anywhere else in the European Union. The referendum on Saturday was called by environmentalists who wanted to end an EU exception that allows hunters to shoot turtle doves and quail for 20 days between April and May, a time when the birds fly north to breed after wintering in Africa. Prime Minister Joseph Muscat, who had backed the hunters, said yesterday they had won about 51% of the vote. — Reuters GRENOBLE (France): A seven-year-old British boy died when he fell from a cliff after straying off piste in the French Alps, emergency services said on Saturday. The boy, who had been on a family skiing holiday in the resort of Flaine in France’s Haute Savoie region, is believed to have taken a wrong turn last Friday after asking his mother if he could make the last descent of the day alone. “He fell 50 to 100 metres,” an emergency services spokesperson said. It was not clear whether the boy was skiing at the time of the accident or was on foot. — AFP Shark kills 13-year-old boy off island of La Reunion Judy Scott being escorted in for the funeral of her son Walter at Word Ministries Christian Center on Saturday in Summerville. Photo by Reuters family, friends, politicians and law enforcement officers gathered to bury him. His family declined to speak to reporters, but their lawyer Chris Stewart said that the family would not “be put in corners based on colour, based on creed.” “Their son is going to be remembered for changing the way we look Kenyan student dies, more than 100 injured in stampede British boy, 7, killed in French Alps skiing accident Hundreds mourn at funeral of black man killed by US cop BY JI M WAT SON IN BRIEF at each other, because next time another side to the story,” he said. something does happen to an inAn overflow crowd of more than dividual, be he African American, 100 people gathered under an awnyou will now think maybe there’s ing outside in drizzling rain. — AFP LES AIGRETTES (France): A 13-year-old boy was attacked and killed by a shark yesterday off the French Indian Ocean island of La Reunion, authorities said, the seventh such deadly attack since 2011. The shark tore off the boy’s limbs and part of his stomach as he was swimming in an off-limits section of the ocean off the west coast of the island. It was the 16th shark attack on the island since 2011 and the seventh loss of life. — AFP 26 WORLD M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY Russian navy evacuates over 300 from Yemen MOSCOW: A Russian navy ship has evacuated 308 people of various nationalities from war-torn Yemen, a defence ministry official said yesterday. The evacuees were en route to Djibouti and included 45 Russians, 18 Americans, five British nationals, 159 Yemenis and citizens of former Soviet states and the Middle East. “All evacuated persons are safely on board the Russian ship which will deliver them to Djibouti by morning,” ministry spokesman Igor Konashenkov told Russian agencies. Russia has been evacuating its own and other citizens by air from the capital Sanaa and by sea from Aden since its consulate was hit on March 29. A coalition led by Saudi Arabia began a push last month against the Houthi Shiite rebels backed by Iran. On Saturday the Russian foreign ministry announced that it will attempt to evacuate more people through today, but that continuing air strikes prevented planes from entering Yemeni airspace. Another attempt was to be made yesterday, according to the Russian embassy in Yemen. Russian media cited a source at the Sanaa airport as saying that the Saudi-led coalition carrying out the air strikes prohibited planes from flying over the conflict-torn country. — AFP Bangladesh tightens security after hanging of Islamist China orders media giant Sina to ‘improve censorship’ BEIJING: China’s government has threatened to shut down Sina, one of the country’s most popular news websites unless it “improves censorship”, state media reported, in a rare public glimpse into controls over the press. The online portal “distorted news facts, violated morality and engaged in media hype”, the official Xinhua news agency on Saturday cited the Cyberspace Administration of China (CAC) as saying. The CAC will “seriously” punish Sina, with possible measures including “a complete shut down of its Internet news services”, Xinhua added. — AFP Justin Timberlake and wife Biel welcome baby boy BY SHA FI Q U L ALAM DHAKA: Bangladesh tightened security nationwide yesterday after a senior Islamist was hanged for war crimes during the 1971 independence conflict, a move that triggered anger among his opposition supporters. Police said extra officers were deployed in the capital and other major cities hours after Mohammad Kamaruzzaman, the third most senior leader of the Jamaat-e-Islami party, was executed in a Dhaka prison late on Saturday. “We’re alert against any bid to create anarchy or violence,” a police spokesman told AFP, saying police and paramilitary officers were patrolling key places to prevent his supporters rallying. Kamaruzzaman was convicted in 2013 by a controversial war crimes tribunal of carrying out a massacre in a village as head of a pro-Pakistan militia. Jamaat, the largest Islamist party, called a nationwide “prayer day” for yesterday and a strike today in protest at Kamaruzzaman’s “heinous killing”. The party branded it an act of “revenge and preplanned murder” by the secular government. The 62-year-old’s hanging is expected to deepen a monthslong political crisis that has seen the Islamists and the main opposition party launch nationwide protests to try to topple Prime Minister Sheikh Hasina. But the execution is unlikely to trigger the widespread deadly violence that was unleashed after the only other execution for wartime atrocities, also of an Islamist, was carried out in 2013. Hundreds of Jamaat activists were killed that year when the party held a series of nationwide protests against trials of its leaders by the tribunal, which was established by Hasina’s government. Security forces have since rounded up thousands of Jamaat supporters in a massive crackdown on the unrest. — AFP IN BRIEF People standing on the rubble of a house destroyed by an air strike, in Amran province, northwest of Yemen’s capital Sanaa yesterday. Photo by Reuters Coalition air strike, clashes kill 27 in Yemen As fighting flares in 15 of the country’s 22 provinces SANAA: A Saudi-led air strike hit a base in central Yemen killing 15 rebels yesterday as 12 people died in overnight fighting in main southern city Aden, medical and security sources said. The predawn strike hit Camp 22 in al-Dhahra in the south of Taez province and also wounded eight Houthi Shiite rebels or allied troops, a medic at al-Thawra hospital said. The base belongs to the elite Republican Guard which remained loyal to former president Ali Abdullah Saleh after he was forced from power in 2012 following a year of nationwide protests against his three-decade rule. Saleh has allied his followers with the Houthi rebels, who overran the capital Sanaa in September, in their battle against forces loyal to fugitive President Abedrabbo Mansour Hadi. The Saudi-led coalition said on Saturday that it had conducted 1,200 air strikes since March 26 and neutralised the air and missile capabilities of the rebels and their allies. The air campaign, which has been accompanied by a naval blockade, was launched as the rebels closed in on Hadi’s refuge in Aden. The president escaped to neighbouring Saudi Arabia as the rebels and their allies entered the port city sparking fierce fighting with his loyalists. Four civilians were shot dead in the city’s Mualla and Dar Saad districts on Saturday, a medic at the Ba-Suhaib military hospital said. A Hadi loyalist blamed rebel snipers for the deaths. In the west of Aden, five rebels and three loyalist militiamen were killed in clashes that flared as the rebels tried to advance towards the city’s oil refinery, sources on both sides said. Since the air campaign began, fighting has flared in 15 of Yemen’s 22 provinces. These include Aden, Daleh, Lahj, Abyan and Shabwa in the formerly independent south, where locally recruited militia have remained loyal to Hadi. Taez, Ibb, Baida, Hudeida, Raymah, Amran, Hajja, Saada, Jawf and Marib have seen clashes between the rebels and tribes loyal to Hadi, or with Saudi troops across the border. Meanwhile, al-Qaeda militants have taken advantage of the security vacuum to seize control of Mukalla, the capital of Hadramawt province in the southeast. — AFP Two dead in attack on S Korea embassy in Libya SEOUL: Unidentified gunmen attacked South Korea’s embassy in the Libyan capital Tripoli yesterday and killed two security guards, Seoul’s foreign ministry said. The group fired dozens of rounds at the embassy compound from a passing vehicle, leaving two Libyan guards dead and another injured, it said. Three South Koreans working in the embassy — including two diplomats — were unhurt, a ministry official told AFP on condition of anonymity. “We do not know whether the attack targeted the embassy or the Libyan [security] officers,” the official said, adding the ministry was considering evacuating all its staffers from the country. Militias which fought to topple Moamer Kadhafi’s regime in 2011 often carry out kidnappings or attacks targeting foreign diplomats in the Libyan capital. The country has been awash with weapons since the end of the uprising that killed Kadhafi and has been gripped by increasing lawlessness. — AFP LOS ANGELES: Singer Justin Timberlake and his actress wife Jessica Biel welcomed their first child into the world on Saturday, a boy named Silas Randall. Timberlake, 34, was “ecstatic”, People magazine said, adding that mother and baby were doing well. “My amazing son and his beautiful wife have given us the most precious gift in the world!” Timberlake’s mother, Lynn Harless, wrote on Facebook. “Silas Randall Timberlake! Named after my father and my son! Life is beautiful and we couldn’t be happier! God bless you all and thanks for all the congrats!” — AFP Police: Woman left quadriplegic son in woods in Philadelphia PHILADELPHIA: A mother abandoned her quadriplegic son in a wooded area of a Philadelphia park for nearly a week so she could visit her boyfriend in Maryland, police said. The 21-year-old disabled man was found by a passer-by at night last Friday lying on leaves and covered by blankets with his wheelchair and Bible nearby, said Philadelphia police Lieutenant John Walker. Police said the man who was abandoned in the woods is unable to talk and suffers from cerebral palsy. — Reuters Death sentences for Brotherhood head and 13 others CAIRO: A Cairo court on Saturday confirmed death sentences for Muslim Brotherhood leader Mohamed Badie and 13 others over Islamist protest violence, while the jailing of a US-Egyptian citizen for life was slammed by the White House. Two of the 14 defendants sentenced to death have fled the country and will immediately face a retrial if apprehended. Judge Mohamed Nagy Shehata also handed life terms to 23 detained defendants. — AFP W O R L D 27 M O N DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY NPC member: China to curb Hong Kong visits Will restrict residents to one per week from unlimited number of daily trips BY JAMES POMFRET & M I C H EL L E C H EN HONG KONG: China will limit visits by residents of the city of Shenzhen to neighbouring Hong Kong, a politician and media said yesterday, following recent tension in the former British colony over growing numbers of mainland visitors. Hong Kong has seen a groundswell of discontent over the number of mainland Chinese visiting Pope describes Armenians’ mass murder as ‘genocide’ the crowded city where frustration with what many residents see as attempts by Beijing to restrict democracy erupted in protests last year. Shenzhen authorities would soon restrict residents to one Hong Kong visit a week, from an unlimited number of daily trips, said Michael Tien, a Hong Kong member of China’s parliament, the National People’s Congress (NPC). “It will definitely happen,” Tien told Reuters. “I’ve heard from very reliable government sources.” Hong Kong returned to Chinese rule in 1997 under a “one country, two systems” formula that ensured it autonomy. Visitors from the mainland need permission to visit. Media said the curbs could come into effect as early as today. Shenzhen is just a short train ride from Hong Kong. On the website where residents of Shenzhen apply for Hong Kong visas, the option for multiple visits a year could not be selected yesterday. There was no immediate response or confirmation from the Shenzhen government. The Hong Kong government said any announcement would come from mainland authorities. But it acknowledged, in a statement, that it had proposed concrete measures to adjust visas that allow Shenzhen residents multiple entries to Hong Kong. — Reuters Poles apart? Dancers say their performance is sporting not sexy BY TOM HANCO C K BY EL L A I D E VATICAN CITY: Pope Francis used the word “genocide” yesterday to describe the 1915 mass murder of Armenians in a move likely to severely strain diplomatic ties with Turkey. “In the past century, our human family has lived through three massive and unprecedented tragedies,” he said during a solemn mass in Saint Peter’s Basilica to mark the centenary of the Ottoman killings of Armenians. “The first, which is widely considered ‘the first genocide of the 20th century’, struck your own Armenian people,” he said, quoting a statement signed by Pope John Paul II and the Armenian patriarch in 2001. — AFP BEIJING: Erotic display or serious sport? At the World Pole Dancing Championships finals in Beijing yesterday, competitors in skintight suits insisted that their challenging discipline deserves Olympic recognition. The limber and lithe contestants from more than 10 countries on four continents hope they can shed the sport’s association with seedy strip clubs and win respect as skilled athletes. “Pole dancing requires technical content as much as gymnastics and acrobatics, and the level of difficulty is higher,” Ke Hong, a member of the Chinese team — one of the strongest in the sport — told AFP ahead of the competition. He is one of over 50 contenders including more than a dozen men at the championships. They force IN BRIEF Australia to deny benefits to parents refusing to vaccinate children SYDNEY: Australian Prime Minister Tony Abbott said yesterday his nation will adopt a “no jab, no pay” policy to block parents who refuse to vaccinate their children from accessing some government benefits. The policy change comes amid a debate over immunisation for children, with some parents believing vaccines against deadly diseases are dangerous. The anti-vaccination movement has coincided with the resurgence of measles, a preventable disease, in some European countries as well as in parts of the United States. China to ‘blacklist’ its unruly tourists — report BEIJING: China will create a “blacklist” of its tourists who behave badly overseas, state-media reported, after several embarrassing incidents involving Chinese travelling abroad. The country’s National Tourism Administration will keep a database of travellers who commit offences, with their names passed onto police, customs officials and even banks, the official Xinhua news agency reported Saturday. — AFP Security officials: Five Egyptian soldiers killed in Sinai bombing A competitor warming up before the semi-finals of the 2015 World Pole Dance Championships in Tianjin on Saturday. Photo by AFP themselves onto the pole for as many as eight hours a day to perfect their gravity-defying spins and poses. “It hurts every day,” he added. “The very first week, I thought about giving up.” The scale of the competition reflects the growing appeal of pole dancing as a fitness aid over the last decade — with thousands of clubs estimated to have opened worldwide, including more than 500 in the United States alone. Competitors making the journey to China this year include the British current World champions ‘Bendy’ Kate Czepulkowski and Sam Willis, the event’s organisers said. — AFP CAIRO: Five Egyptian soldiers were killed and three others wounded in a bomb attack on their armoured vehicle in the Sinai region yesterday, security officials said. Security officials said the roadside bomb was planted in an area of the northern Sinai peninsula that is a stronghold of Ansar Beit al-Maqdis, which has pledged allegiance to the Islamic State group.— AFP 28 live it! M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY MO WELLBEING . THE ARTS . WINE+DINE . STYLE+DESIGN . LEISURE Personal ASSISTANT COMPI L ED BY S U ANN QUAH WORK. LIFE. BALANCE LEARN about the colourful history of Kuala Lumpur in a play presented by the Kuala Lumpur City Hall. Set in 1880 against a flourishing tin mining industry, MUD: Our Story of Kuala Lumpur is the tale of three friends trying to make it big in the city despite their cultural differences. The play is a wonderful mosaic of stories and personalities that make up the building blocks of what KL is made of today. Directed by Tiara Jacquelina and Amsalan Doraisingam, written by Ghafir Akbar and Chedd Eddie Yusoff, MUD is a must-watch play for both Malaysians and foreigners wanting to learn more about the history of Kuala Lumpur. The play is currently showing at Panggung Bandaraya, Jalan Raja, Kuala Lumpur. Showtime is 3pm and 8.30pm daily and tickets are priced at RM60 and RM45 (with MyKad), and can be purchased over the counter at the Panggung Bandaraya Box Office, Jalan Raja, 50350 Kuala Lumpur. gum tab som wo bet the ten Money vs MORALITY A local production of David Mamet’s Speed The Plow tackles the proverbial chasm between art and commercial gain BY ANANDHI G O P I NATH S THERE is nothing like indulging in a hearty homemade pie and basking in its glorious aroma of beef, seafood, chicken and mushroom. Head over to traditional English-styled Bentley’s Pub at Intercontinental Hotel KL where they will be serving pies and tarts baked fresh daily for lunch and dinner all through the month. Savour delicious peppered Angus beef and onion pie, seafood pot pie, chicken and mushroom pie, as well as their vegetarian option of curry and sweet potato pie, all priced from RM26. These pies are served from 12pm to midnight at Bentley’s Pub, Intercontinental Hotel, 165 Jalan Ampang, Kuala Lumpur. For reservations or inquiries, call (03) 2782 6268. econds after walking into Pentas 2 and taking my seat, I already knew I was going to like Speed The Plow. Apart from the refreshing and simply delightful menu of 50s music playing in the background, the set that greeted the audience was remarkable — realistic and detailed; it was in complete defiance of the bare and Spartan styles favoured by a lot of contemporary theatre these days. Written by American playwright David Mamet, Speed the Plow’s plot follows two movie executives as they discover that a famous Hollywood star may be willing to headline their new project, despite usually being attached to a rival studio. Flushed with the glow of looming success, Bobby Gould (who has just been promoted) and Charlie Fox make a bet over which one of them will score with the attractive new temporary secretary who has begun working in the office. However, it turns out that the young woman in question, Karen, has her own idealistic views of what works in Holly- wood, not to mention a determination and willingness to do whatever it takes to get her own way. As I was early, I had a chance to absorb some of the more minute details of the set — an Oscar statue taking pride of place in one corner, furniture covered with a plastic covering to protect it from the dust from new renovations, movie posters on the floor waiting to be framed. I couldn’t be completely sure from where I was sitting, but it did look like the framed photograph on a side table was of the Dalai Lama and Gavin Yap, who plays Bob — something that reaffirmed the newly promoted producer’s brash personality. The overall effect is of a gritty movie producer’s office in the 1960s, in a time when men could smoke cigarettes indoors and women wore pretty clothes and answered phones. The play was written in 1988, when the subject of women’s rights and representation was still blurry, which reflects the way Mamet addresses the subject as well — I can’t be sure if the misogyny expressed by the characters is meant to criticise misogyny itself or is a direct reflection of the author’s own is- sues with women. Speed The Plow begins with Bob striding on stage, delivering an opening soliloquy that is a reminder of what a good actor he is and how well he throws himself into a role — he is a glib, overly confident, slightly sleazy and terribly intense movie producer. Charlie, played by comedian and actor Douglas Lim, is jumpy, nervous, more effusive and slightly less refined than his friend Bobby. Within minutes, the intensity of the play and the incredible chemistry between Yap and Lim becomes evident. Although Yap is the much stronger actor, Lim gets increasingly into the role as the play progresses and does a wonderful job of making Charlie’s character extremely likable — you can’t help but warm to his passionate intensity and ability to see through Karen’s pretensions. Amelia Henderson does a remarkable job of playing Karen, and the build-up from ditzy secretary to smart and sassy manipulating femme fatale was a joy to watch. As she is handed a book that Bobby says is a courtesy read and will never make a good movie, she later comes to his home and presents a compelling ar- the be es l Ka say Id mu ord tha thr the tha mo wh Lo id s and hop the like tak mo or t etple the stro be bac the has it. Th gon tru rea Spe Pa cal to p live it! 29 M O N DAY A PR I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY WELLBEING . THE ARTS . WINE+DINE . STYLE+DESIGN . LEISURE The final showdown between Karen (Amelia Henderson), Charlie Fox (Douglas Lim) and Bobby Gould (Gavin Yap). TELEVISION & MEDIA CO MPIL E D BY S U A N N Q UA H Bringing definition to the next level idsood self ent, vie ian rvrethe bent. tor, the ob ely his see ble up ssy y to obver s to ar- gument why he should reject the offer already on the table for this one, and of course, have her involved somehow. As flawlessly as she delivered her lines, it would have been nice to see a little more chemistry between her and Yap — Karen and Bobby do spend the night, after all and there was very little sexual tension to allude to that fact. The next day, Bobby and Charlie battle it out as they decide which movie should be the one that will be made. The ensuing duel is hilarious as Bobby waxes lyrical about what he now believes in because of Karen’s influence, and Charlie puts it in context by saying “Hey, I believe in the Yellow Pages, Bob, but I don’t want to film it.” Mamet’s text needs actors who can make his very musical, percussive dialogue crackle as it should in order to unleash the full, abrasive force required. To that end, Loosley has cast the play brilliantly as the three actors have internalised the text very well and their delivery doesn’t seem rehearsed at all — and that’s quite a remarkable feat. Speed The Plow is very fast-paced and it can almost be an effort keep abreast of what is going on — whether that’s what Mamet intended or something Loosley crafted is not clear. The actors speak in rapid succession and the storyline moves very quickly, and as a result the ending is not as climactic as I had hoped. However, the play is notably short and when the actors make their final bow, you’re left feeling like you really want a little more. Mamet meant for Speed The Plow to be a satirical take on the clash between art and commerce in the movie world — do you talk down to the audience or try and enrich them? Do you treat them like ticket-buying minions or like intelligent thinking people? Is money or morality the priority? To that end, the text itself doesn’t address this very well — the stronger message is how easily your decisions can be reversed, and what it sometimes takes to get you back on track. Watch Speed The Plow not for its aim to discuss the money versus morality argument, as Mamet hasn’t done a very remarkable job in highlighting it. This play is worth a watch for the effort that has gone into its production and the way it has put some truly brilliant acting and directing on stage. Gritty, real and totally in your face. Speed The Plow is playing till April 15 at Pentas 2, KLPac, Jalan Strachan, KL. Tickets are priced at RM68; call (03) 4047 9000 or visit www.ticketpro.com.my to purchase. OUT with the old “High Definition”, and in with the brand new “Ultra High Definition” (UHD). As if watching movies and TV shows in HD isn’t good enough, we can now watch them in UHD, featured in Samsung’s newly unveiled SUHD TV. Designed to elevate our viewing experiences, this television features a SUHD remastering engine which optimises all content being played to match the colour and brightness for the SUHD TV, and a stylish curved design for a more immersive viewing experience. See more and feel more with the TV’s stunning contrast, striking brightness and spectacular colour packed into its UHD detail. Samsung has managed to achieve this through the use of nano-crystal technology that transmits a spectrum of colours depending on their size, and subsequently produces the highest colour purity and light efficiency available in the market today. Ever looking towards the future, Samsung has also partnered with leaders in the filmmaking industry to promote and secure a steady growth of comprehensive UHD ecosystems. In order to establish premium UHD quality standards, they have announced the UHD alliance PICK OF THE DAY WITH the release of Samsung’s newest addition to their flagship Galaxy line, Montblanc has released a collection of fine leather covers for the brand new Samsung Galaxy S6. This new collection is the latest iteration of Montblanc’s partnership with the global leader in mobile technology, following the introduction of the first ever Montblanc ScreenWriters last year. The Pix and the eStarWalker, electronic writing instruments with their inventive e-refill concept were created for the Galaxy Note line in addition to a new generation of smart leather covers encapsulating an ID chip allowing their owners to access exclusive Montblanc digital content. This year, Montblanc presents a hard shell cover and a flip side cover, available in black soft grain leather and Montblanc extreme leather which is renowned for withstanding the toughest conditions. The Montblanc soft grain & extreme leather flip covers (S6) are priced at RM750, the softgrain & extreme leather hard-shell covers (S6) at RM410, the Montblanc extreme leather hard-shell cover (S6 Edge) at RM430 and the Montblanc leather flip cover (S6 Edge) at RM815. — a coalition of companies united to set the bar for next generation video entertainment. Amongst the things that they are currently working on are innovations in video technologies, higher resolutions, higher dynamic range, a wider colour gamut and immersive 3D audio. In addition to the technological advances that Samsung has managed to cram into these new television sets, it has also designed them to be modern and minimalist — styles that are in trend today. Mounted on a wall, the SUHD sets are intended to replicate the look of an art piece instead of a piece of equipment. The Samsung SUHD TVs come in three series: the JS9500, JS9000 and the JS8000 which range from 55 to 58 inches in length. The retail prices for each are: RM39,999, RM24,999 and RM9999 respectively, inclusive of 6% GST. 30 live it! M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE FI N AN C I AL DAI LY WELLBEING . THE ARTS . WINE+DINE . STYLE+DESIGN . LEISURE Zen TODAY We cannot solve our problems with the same thinking we used when we created them. — Albert Einstein CANNES this year Speculations over who’s going to be walking on the Red Carpet at the French Riviera next month W ith the Cannes Film Festival set to open in just over a month’s time, speculation is swirling over which films — and which top directors and actors — could be getting their moment under the French Riviera sun. Woody Allen is seen as more than likely to be walking the red carpet with his new flick, Irrational Man, starring Joaquin Phoenix. Cate Blanchett might also be along for her movie Carol. And fellow Oscar-winner Matthew McConaughey could appear for The Sea of Trees the latest film by director Gus Van Sant, which also stars Naomi Watts. Cannes’ organisers jealously guard their selections for the competition line-up and the out-of-competition programme until a month before the film fest opens. This year, the movies to be shown at Cannes will be announced on April 16, and the festival will run from May 13 to 24. A cocktail of cinema The organisers have a dizzying task in choosing which movies make the cut, wading through some 1,800 films to winnow them down to short lists. The director of the festival, Thierry Fremaux, said last week that “there is no more than a third of the selection definitively decided”. He added that he and his selection committee “watch the movies right to the end”. Cannes mixes international arthouse cinema, Hollywood blockbusters, extravagant parties, industry wheeling and dealing, and eye-catching publicity stunts in a potent cocktail that has made it the pre-eminent global showcase for movies. So far the only movie confirmed to be screened is Mad Max: Fury Road. The dystopian sci-fi movie, the fourth in the high-action Mad Max franchise and the first to star British actor Tom Hardy in the title role, will be shown out of competition on May 14 just before its worldwide release. Fury Road co-stars Charlize Theron, who is expected to saunter up the red-carpeted steps. She could put on another dress and put in another appearance for The Last Face, a film she is in that is directed by Sean Penn and also stars Javier Bardem. Harry Potter actress Emma Watson and Boyhood star Ethan Hawke might be along if Regression, by Spanish director Alejandro Amenabar (who made The Others, The Sea Inside) is selected. Then there’s Colin Farrell and Rachel Weisz in the The Lobster, a sci-fi tale financed with Irish money and directed by Greece’s Yorgos Lanthimos. Or Jesse Eisenberg, Gabriel Byrne and Isabelle Huppert in Louder Than Bombs by Norwegian filmmaker Joachim Trier. A filepic of Fremaux holding an umbrella as he stands on the red carpet at the 2014 Cannes Film Festival. He said last week that ‘there is no more than a third of the selection definitively decided’ for this year. Photo by Reuters Asia anticipation Italy’s flag could flutter over Mia Madre, the most recent picture by Nanni Moretti who won Cannes’ top prize the Palme d’Or in 2001, or maybe La Giovinezza by Paolo Sorrentino, whose Grande Bellezza (The Great Beauty) won a foreign picture Oscar last year. Asia, as always, is expected to be well represented. Thailand’s Apichatpong Weerasethakul has just completed a romance, Love in Khon Kaen, which might screen. Taiwan’s Hou Hsiao-hsien, a competition veteran, has a good chance with martial arts picture The Assassin. Finally, of course, Cannes always has a soft spot for French productions. While directors Jacques Audiard or Arnaud Desplechin might screen their latest films, much attention is being thrown on The Little Prince, a big-budget French animation directed by US filmmaker Mark Osborne that adapts the famous novel by Antoine de Saint-Exupery. — AFP S P O RT S 3 1 M ON DAY A P R I L 1 3 , 20 15 • T HEED G E FINA NCIA L DA ILY Formula One: Rosberg slams Hamilton’s tactics Fragile truce between feuding Mercedes drivers unravelling fast BY A L A STA I R H I MME R SHANGHAI: Nico Rosberg accused Lewis Hamilton of putting himself before the team yesterday as the fragile truce between the feuding Mercedes rivals unravelled spectacularly in China. World champion Hamilton won from pole for a record fourth victory at Shanghai but Rosberg ripped into the Briton after the race, accusing Hamilton of deliberately holding him up as Sebastian Vettel’s Ferrari closed in. “He compromised my race,” fumed Rosberg, who finished second after demanding over the radio that Hamilton be ordered to speed up. “By driving slower than was necessary at the beginning of stints meant Sebastian was very close to me.” Hamilton rejected Rosberg’s claims after dominating from start to finish. Hamilton (right) celebrating his victory in front of team mate driver Rosberg after the Chinese F1 Grand Prix. Photo by Reuters “It’s not my job to look after Nico’s race,” he shrugged. “My job is to control my race. I didn’t do anything intentionally to slow any of the cars up. I just focused on myself.” Rosberg angrily fired back: “It’s now interesting to hear from you, Lewis, that you were just thinking about yourself.” Niki Lauda, the Mercedes team’s non-executive chairman, did not share Rosberg’s view that Hamilton had driven selfishly. “These guys are egocentric people,” he said. “This is the only way to win — they’re all the same. Lewis was better this weekend.” “Lewis had pole position and controlled the race from the beginning to the end,” he added. “There’s nothing more to say. Therefore, I think there’s no need to quarrel.” The pair, whose rivalry dates back to karting as teenagers, bickered constantly last season. An ugly public spat boiled over when Rosberg drove into Hamilton in Belgium, for which the German was disciplined by Mercedes. Signs of friction had already reemerged this season, with Rosberg forced to deny suggestions he deliberately slowed Hamilton by getting in his way during qualifying in Malaysia two weeks ago. Asked if he wanted to respond to Rosberg’s charge, Hamilton laughed “not really”, before repeating: “My job is to manage the car and bring the car home as healthy and fast as possible.” — AFP Khairy hopes for good outcome for Chong Wei KUCHING: Youth and Sports Minister Khairy Jamaluddin yesterday expressed hope that there will be a good outcome for Malaysian badminton ace Datuk Lee Chong Wei’s doping case. “He (Chong Wei) called me after the hearing and told me that the Badminton World Federation (BWF) had given him and his lawyers the opportunity to explain. “Chong Wei also said that he was satisfied with the procedure throughout the hearing. “We have done our best. We have prepared well for the case and I think Chong Wei’s lawyers, led by Mike Morgan, have presented the Spieth stumbles but stays in front at Masters BY JI M SL ATER AUGUSTA: Jordan Spieth stumbled under the weight of leading the Masters, but salvaged par with a clutch closing 10-foot putt to set a 54-hole record and maintain a four-stroke lead. The 21-year-old Texan’s dramatic finish to a two-under par 70 third round on Saturday at Augusta National gave him a 54hole Masters record of 16-under 200 and partly eased the sting of a double bogey at 17. “It was really big. It was huge. It was one of the bigger putts I’ve ever hit,” Spieth said. “I was very frustrated.” Speith, who settled for second last year in his Masters debut after leading on the front nine yesterday, made four birdies in five holes to reach 18-under and led by six with two holes to play. But a poor tee shot led to his setback at 17 and an approach well right of the green at 18 forced an aggressive chip that Spieth admitted would likely fail four times out of five. “It was huge just to see one go in after the disappointment there on 17, where I probably should have just hit 3-wood off the tee,” Spieth said. Spieth, who set a 36-hole Masters record of 14-under 130, lost only one stroke off his halfway lead, but finds 2013 US Open winner Justin Rose alongside him in the final pairing after a closing run of five birdies in six holes and fivetime major winner Phil Mickelson only five shots back after matching Rose with a 67 Saturday. “They are going to bring their game and I’ve got to have a relatively stress-free round going, I mean give myself some tap-in pars and not have to make so many putts,” Spieth said. — AFP best defence possible for him. “All we could do now is to wait for the outcome of the hearing,” Khairy told reporters after the launch of Fit Malaysia by Sarawak Chief Minister Tan Sri Adenan Satem at Padang Merdeka yesterday. It was reported that the hearing process lasted about eight hours in Amsterdam on Saturday and the verdict is expected within three weeks. Chong Wei, 32, was temporarily suspended by the BWF after he was tested positive for dexamethasone at the World Championships in Copenhagen, in August last year. — Bernama Grand National glory for Many Clouds BY I AN C HADBAND LIVERPOOL: Jockey Leighton Aspell and owner Trevor Hemmings celebrated Grand National history on Saturday as the Oliver Sherwood-trained Many Clouds courageously triumphed in the 168th edition of Aintree’s famous steeplechase. Aspell could hardly believe it as he became the first jockey for 61 years to win the National on different horses in two successive years following his victory on Pineau De Re last year. The 79-year-old Hemmings, one of Britain’s biggest leisure tycoons and owner of Preston North End Football Club, was equally astonished as Many Clouds became his third different National winner, equalling a century-old record. The 25-1 shot took up the running with four fences remaining but horse and jockey had to dig deep to hold off runner-up Saint Are (25-1) as they prevailed by one-and-three-quarter lengths after nearly four and a half miles of racing. There was to be no fairytale farewell for the sport’s greatest jockey Tony McCoy in his record 20th and final ride in the race before his retirement when, following a promising outing on Shutthefrontdoor, he faded from second to fifth after the final fence. Aspell’s story had its own touch of fantasy as the 38-year-old, who retired in 2007 only to come back 18 months later when it dawned how much he missed it, became the first jockey since Red Rum’s pilot Brian Fletcher in 1974 to win two years in a row. He was also the first since Bryan Marshall in 1953 on Early Mist and 1954 on Royal Tan to triumph in consecutive years on different horses. Hemmings, owner of Hedgehunter (2005) and Ballabriggs (2011), became the first owner since Charles Assheton-Smith in 1913 to win with three different horses. — Reuters IN BRIEF Drive M7 SIC team suffer technical glitch in Moto3 qualifying KUALA LUMPUR: Unfortunate circumstances hampered the Drive M7 Racing team in the qualifying session of the Red Bull US Motorcycle Grand Prix held at the Circuit of Americas, Texas, on Saturday. Malaysian Moto3 rider Zulfahmi Khairuddin looked set to claim a top 15 grid position when an unfortunate technical issue caused a premature end to his session. The 23-year-old rider met the chequered flag in 28th place after speeding to a best lap of 2 minutes 17.941 seconds, 2.597 behind Danny Kent of Leopard Racing team who secured pole position with a time of 2:15.344s. — Bernama Hafizh Syahrin qualifies at 15th position in Moto2 race KUALA LUMPUR: Malaysian Moto2 rider Hafizh Syahrin Abdullah has done a great job to qualify at 15th position despite riding alone on track in the Red Bull US Motorcycle Grand Prix held at the Circuit of Americas, Texas, on Saturday. The Petronas Raceline rider worked extra hard alone on the track without any tow from the faster riders to clock his best lap of 2 minutes 10.894 seconds, 1.006 seconds off poleman, Xavier Simeon from Federal Oil Gresini Moto2 team. The Belgium rider secured the pole with a new lap record of 2:09.888s in lap 16. — Bernama Button handed time penalty for Maldonado’s collision SHANGHAI: McLaren’s Jenson Button was handed a time penalty that cost him 13th place in yesterday’s Chinese Grand Prix after accepting responsibility for a collision with Lotus driver Pastor Maldonado. The 2009 Formula One world champion, who dropped to 14th as a result of the extra five seconds added to his time, also picked up two penalty points for the turn one collision. “I thought there was room on the inside,” the Briton said of the incident that led to Maldonado’s retirement for the third race in a row. “Just a misjudgement, I guess.” — Reuters Najib congratulates 1Malaysia Cup champions KUALA LUMPUR: Prime Minister Datuk Seri Najib Tun Razak congratulated Ipoh Friday’s Football Club for winning the 1Malaysia Cup yesterday. “I hope this win will be spur them to success as professional players and [they] will benefit from the Real Madrid Foundation Campus Experience,” he said in his Facebook page yesterday. The 1Malaysia Cup football tournament was organised to promote the development of local football players and to turn them into professional players. — Bernama 3 2 S P O RT S M ON DAY AP RI L 1 3 , 2 0 1 5 • TH EEDGE F I N AN C I AL DAI LY City’s season in ‘the garbage’, says Pellegrini Ahead of Manchester derby at Old Trafford LONDON: Manchester City manager Manuel Pellegrini delivered a damning verdict on his club’s season ahead of the Manchester derby at Old Trafford yesterday, saying they had thrown their campaign “into the garbage”. Since the turn of the year, reigning Premier League champions City Hamburg players fight at half-time BERLIN: Relegation-threatened Hamburg confirmed yesterday that their players came to half-time blows during their latest defeat amid jokes that even Cristiano Ronaldo could not help the Bundesliga strugglers avoid a historic drop. Their 2-0 home defeat to Wolfsburg on Saturday left Hamburg 17th in the table and four points from safety with six games left. They finished with 10 men after Swiss defender Johan Djourou was sent off late for a second yellow card against Wolfsburg. Hamburg’s media director confirmed reports that Djourou and midfielder Valon Behrami came to blows in the Hamburg dressing room during the halftime break. “It’s true, there was an incident and those involved will be fined,” Hamburg’s Joern Wolf told SID, an AFP subsidiary. Hamburg have failed to score in the last 494 minutes of Bundesliga football and have netted just 16 times in their 28 league games this season, leading to jokes even Real Madrid goal-machine Ronaldo could not save them from relegation. “My brother said that even Cristiano Ronaldo could come — and he wouldn’t be able to help either,” quipped Hamburg’s Croatia striker Ivica Olic. Olic rejoined Hamburg from Wolfsburg in January’s winter break, but is still waiting for his first goal since his return. Hamburg have lost 15 games, the most in the Bundesliga this season. They are the only team in Germany’s top flight to have never been relegated but a historic drop to the second division looks imminent having stayed up last season only after winning a two-legged play off. — AFP have been eliminated from both the FA Cup and the Champions League. Meanwhile, their hopes of retaining the English top-flight title have all but scuppered by losses to the likes of Arsenal, Liverpool and, more damningly, Burnley and Crystal Palace. Now they will kick off away to Manchester United in fourth place — a point behind their local rivals and at least nine adrift of table-toppers Chelsea, who faced strugglers QPR earlier yesterday. “It has not been a good season,” Pellegrini, quoted in several British newspapers, said yesterday. “It was not so bad until the end of 2014, when we were top of the ta- ble and also had the FA Cup and Champions League. “But in the last three months we have thrown it into the garbage,” the under-pressure Chilean added. “I think always for the fans it is important to finish as near to the top of the table as you can and that’s what we must do.” — AFP ‘Perfect run’ only way for Arsenal to win title, says Wenger BY JAMES MCMATH BURNLEY: Arsene Wenger has said his Arsenal side need a “perfect run” to have any chance of catching Premier League leaders Chelsea. Saturday’s 1-0 win away to Burnley made it eight league wins in a row for the Gunners for the first time since the ‘Invincibles’ season of 2003/04. Chelsea were four points in front with two games in hand ahead of their match away to relegation-threatened Queens Park Rangers yesterday and the title is now theirs to lose. But London rivals Arsenal have emerged as their closest challenges due to a superb run of form. However, cautious Arsenal manager Wenger said after his side’s latest triumph at Turf Moor, “Nothing has changed, we need a perfect run and we need a non-perfect run from them (Chelsea) but we can’t master that, we can only master our own position.” “We want to keep winning because we have to look behind us as well at Manchester United and Manchester City,” the veteran French boss added. “I think we have won 15 of last 17 so we are consistent.” “When you look at the number of players we had out for months at the start of the season, we got our squad back since January and that makes a difference.” “Let’s focus on the next game and give absolutely everything to finish in a strong way.” Aaron Ramsey’s ninth club goal of the season was enough to give Arsenal maximum points against a determined Burnley team, who missed the chance to move out of the relegation zone. Burnley have taken points off Manchester City, Chelsea and Tottenham Hotspur this season with performances full of spirit and they made Arsenal work hard for the victory, without seriously threatening to equalise. Wenger said: “I’m pleased with the performance because it was a fighting performance and many people question us on that side.” — AFP Wenger: Nothing has changed, we need a perfect run and we need a non-perfect run from them (Chelsea). Photo by Reuters The row is just the latest controversy to hit Indonesian football. third parties”, in an April 10 letter posted on the sports ministry’s website yesterday. The row is just the latest controversy to hit Indonesian football, Koeman expects last day drama in battle for Europe SOUTHAMPTON: Southampton manager Ronald Koeman believes the battle to finish fifth in the Premier League will go to the final day of the season. Koeman conceded defeat in his side’s efforts to break into the top four after the recent defeat against Everton, but Saints’ 2-0 home win over relegation-threatened Hull on Saturday moved them up to fifth, two points above Liverpool and Tottenham in the battle for a berth in next season’s Europa League. Liverpool will have the opportunity to leapfrog Southampton when they face Newcastle today, but Koeman insists the three-way contest will go all the way to the wire. — AFP Ancelotti: Real fired up for Atletico revenge MADRID: Real Madrid coach Carlo Ancelotti has said his side will be out to avenge the humiliation of their 4-0 defeat to Atletico Madrid in February when the sides meet in the Champions League quarter-final tomorrow. Los Blancos beat Atletico 4-1 after extra time to win their 10th European Cup in last season’s final, but the La Liga champions have turned the tide in the Spanish capital this season with four wins and two draws in six previous meetings this campaign. The most recent of those matches was the most embarrassing for Real as Atletico outplayed Ancelotti’s men from first minute to last to seal their biggest win in a Madrid derby for 28 years. — AFP PSG retain League Cup, next up Barcelona FIFA warns Indonesia govt over domestic league JAKARTA: FIFA has warned the Indonesian government not to interfere in the running of the country’s domestic league, the sports ministry said yesterday as it rejected the accusation. FIFA secretary-general Jerome Valcke told sports minister Imam Nahrawi to allow the Football Association of Indonesia, known by its Indonesian acronym PSSI, to manage its affairs “independently and without influence of any IN BRIEF which has been beset by problems in recent years including the cases of two foreign players who died after they fell ill but were unable to pay for treatment because they hadn’t been paid for months. The football association has also been in hot water with FIFA and the Asian Football Confederation in recent years over poor management, corruption allegations, leadership tussles and poor security at major matches. — AFP PARIS: Zlatan Ibrahimovic inspired holders Paris Saint-Germain (PSG) to the first of a potential four trophies this season with a 4-0 win over 10-man Bastia in the League Cup final on Saturday. In a repeat of the 1995 final, a first-half brace by the Swedish star, completed by Edinson Cavani’s second-half double, kept Ligue 1 leaders PSG in the hunt for an unprecedented quadruple. The win teed up Laurent Blanc’s side nicely for Wednesday’s visit to Barcelona in the Champions League quarter-final first leg with Auxerre awaiting them in next month’s French Cup final. — AFP Deila says Celtic’s title race far from over GLASGOW: Celtic manager Ronny Deila says the race for the Scottish Premiership title is far from over after Saturday’s disappointing 1-1 draw away to Inverness Caledonian Thistle. The Hoops have an eight-point lead at the top of the table as they chase the fourth successive league title, but this will be reduced to five if Aberdeen were to defeat Kilmarnock. — AFP
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