Stocks In Focus (Hock Seng Lee, OCK, UMW Hldgs) – 27/10/14

Stocks In Focus (Hock Seng Lee, OCK, UMW Hldgs) – 27/10/14  

HSL Eyes New Highway Jobs

• Hock Seng Lee (HSL) is eyeing new jobs in the Pan Borneo Highway project, which is expected to be accelerated by big funding under the federal budget 2015.
• The firm is expected to bid for the works on a case-by-case basis based on its strength in the marine engineering field and stated that it is quite competitive in road works, especially in coastal swampy areas that normally involves reclamation works.
• Currently, HSL has an order book of about RM2.2 billion and is undertaking five ongoing road projects with combined contract value of nearly RM370 million.

Significance: HSL expects to have inflow benefits from the increased development allocation for the Pan Borneo Highway and noted that it is very competitive where logistics is concerned through leveraging on its shipping arm.
OCK Gets Approval For Mainboard Transfer

• OCK Group, Malaysia’s leading telecommunications network services provider, has received approval from the respective authorities for its proposed transfer from the Ace Market to the Main Market of Bursa Malaysia Securities.
• Since its listing in 2012, OCK’s share price reached a high of RM1.58 in on 23 July, representing a premium of 338.9 percent as compared to its issue price of RM0.36.
• OCK has successfully increased its telecommunication asset count since the group’s listing and is currently managing a portfolio of maintenance work nationwide for various major telecommunication operators. The firm has also ventured into the green energy and power solutions segment.

Significance: According to the group’s managing director, Sam Ooi; to be listed on the Main Market has always been one of the firm’s key objectives to proliferate its corporate value, stating that OCK can start on its next phase of growth with the approval of a Mainboard transfer.
UMW’s Unit To Grow Lubricant Market Share

• UMW Holdings wholly-owned unit, UMW Lubricant International (ULI), aims to grow its lubricant market share to double digits by 2019 up from about 7 percent currently.
• ULI is the official distributor of Repsol lubricants in Malaysia and the plan to capture more market share is in line with the company’s plans to increase its dealership network and production volume.
• At the moment, about 90 percent of ULI’s Repsol products sold in the country are locally blended and the firm plans to achieve 100 percent product localisation in a bid to offer lower prices to consumers and increase its market share.

Significance: Presently, the group is utilising about 80 percent of its 50 million-litre blending plant in Shah Alam and has plans for a new lubricant plant if production volume increases. The firm also expressed interest to expand to other Southeast Asian countries as the company continues to grow.

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