JF Apex Securities Berhad Newsletter Daily As Highlights 5 December Malaysia News & Highlights. Foreign News

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1 JF APEX SECURITIES BERHAD (47680-X) KDN PP13226/04/2013 (032022) JF Apex Securities Berhad Newsletter Daily As Highlights 5 December 2013 Malaysia News & Highlights Long way to go before water impasse in S'gor can solved? Ekovest named Duke Phase 2 master builder Caely unit wins deals worth RM97.25m YTL unit banks on network expansion Turnaround on right track, says MAS chief Cypark to gain from new surcharge Bina Goodyear buys Astinas assets Two Benalec directors resign HELP to be taken private? Foreign News U.S. Stocks Drop on Fed Stimulus Bets Amid Budget Talks European Stocks Advance Before U.S. ADP, Home Sales Data Emerging Stocks Decline After U.S. Data as Rand Tumbles Treasury Yields Climb to 11-Week High as ADP Spurs Jobs Optimism Moody s Boosts Spain s Credit Rating Outlook on Growth Prospects FBM KLCI Daily Chart Closing: Support: 1800 Resistance: 1840 Please read carefully the important disclosures at end of this publication

2 Market Thoughts U.S. stocks were little changed on Wednesday as Wall Street shifted through economic reports for hints as to when the Federal Reserve would reduce stimulus, with investors on shaky ground two days before the release of the November jobs report. Meanwhile, European equities closed lower for a third-straight day, after betterthan-expected jobs data from the U.S. increased concerns that the Federal Reserve would "taper" its bondbuying program sooner rather than later. On the local bourse, the FBM KLCI fell 2.39 points to points. Asian equity markets are headed for a mixed start following a tepid session on Wall Street overnight and we expect the KLCI to remain range bound above the 1800-point threshold. Stocks to watch for today are: 1) Ekovest, as the group has bagged the DUKE highway phase 2 worth RM1.2b; 2) Water concessionaires, as Puncak Niaga and Gamuda are unable to consider the offer by Selangor government; 3) Caely, after the group has won two construction projects worth RM97m; 4) HELP, as the media highlighted that the group may be taken private by a foreign private equity firm for around RM2.50/share following its share suspension today pending material announcement; 5) Developers having projects in Medini Iskandar such as Mah Sing, Sunway, E&O, WCT, following the news that the special economic zone has been given an exemption from the RPGT announced in Oct Budget. Malaysia News & Highlights Long way to go before water impasse in S'gor can solved? Puncak Niaga Holdings Bhd has come out strongly to say that it has refused the latest offer by the Selangor government that expired yesterday to acquire its water assets because such a move would be detrimental to its shareholders. The company, in a press statement yesterday, claimed the deal would only give the company proceeds of RM1.555bil for its 100% equity stake in Puncak Niaga Sdn Bhd and 70% equity stake in Syarikat Bekalan Air Selangor Sdn Bhd (Syabas). This is far below the RM5.594bil stated price offered by Kumpulan Darul Ehsan Bhd (KDEB), the Selangor state investment arm. (Source: The Star) Ekovest named Duke Phase 2 master builder Ekovest says it has received a letter from Konsortium Lebuhraya Utara-Timur (KL) Sdn Bhd appointing the company as the master contractor for the RM1.18 billion Phase Two of the Duke Highway here. In a filing to Bursa Malaysia, Ekovest said it will be responsible for the design, construction, safety, landscaping, maintenance of construction works and signage works related to the Phase Two of Duke highway. The threeyear contract is expected to be completed at the end of 2016, it said. (Source: Business Times) Caely unit wins deals worth RM97.25m Caely Holdings Bhd says its unit Caely (M) Sdn Bhd has won two construction projects worth RM97.25 million from Koperasi Peserta-Perserta Felcra Malaysia Bhd. The company said the first project is to design, construct and complete 770 houses in Pasir Salak, Perak, for RM69.04 million, while the second project is to construct and complete the infrastructure at the same area for RM28.21 million. The contracts are to be completed within a period of 24 months from the date of the contract, it told Bursa Malaysia yesterday. (Source: Business Times) YTL unit banks on network expansion Conglomerate YTL Corp Bhd's communications arm, YTL Communications Sdn Bhd, is optimistic of breaking even at a much faster pace with an aggressive expansion of its network coverage nationwide. Its chief executive officer Wing K. Lee said this could be achieved in less than three years, in line with its total number of subscribers of 700,000 to date. "The increasing number of subscribers is due to the wider network coverage of 85 per cent in the country so far," he said at a memorandum of understanding (MoU) signing ceremony between YTL Communications and Intel Malaysia here yesterday. (Source: Business Times) Turnaround on right track, says MAS chief The Malaysia Airlines (MAS) chief is hopeful that the national carrier will turn around in fiscal year 2014 as its strategy to improve profitability is bearing fruit. Group chief executive officer (CEO) Ahmad Jauhari Yahya told

3 Business Times in an interview yesterday that MAS three-year business plan, introduced in late-2011,is on the right track. (Source: Business Times) Cypark to gain from new surcharge Renewable energy player Cypark Resources Bhd will be ensured a steady income flow with the revised surcharge on electricity bill for the renewable energy (RE) fund. Cypark, the only listed renewable energy developer, is expected to benefit hugely from the revised surcharge and in tandem with the company s growing capacity. (Source: The Star) Bina Goodyear buys Astinas assets Bina Goodyear Bhd is buying the assets of Johor-based builder and property developer Astinas Construction & Development Sdn Bhd for RM10mil in cash to remedy its PN17 status. It told Bursa Malaysia in a filing the assets comprised construction contracts with an orderbook of RM250mil and the related receivables and documents. Bina Goodyear, a construction and building contractor, said it would pay for the acquisition with funds to be raised from a regularisation plan to be announced later. (Source: The Star) Two Benalec directors resign Benalec Holdings Bhd s Datuk Leaw Tua Choon and Datuk Leaw Ah Chye have quit as directors of the company ahead of an EGM to remove them. The resignations took effect yesterday, Benalec said in a stock exchange filing. The board has also called off the EGM. In October, the brothers were redesignated as non-executive directors from executive directors after their service agreements were terminated due to certain land deals which Benalec has since taken to court. (Source: The Star) HELP to be taken private? Tertiary education provider HELP International Corp Bhd may be taken private by a foreign private equity firm for around RM2.50 per share, sources said. HELP as well as Selangor Properties Bhd, which owns 51% in the company, have requested that both counters be suspended today, pending a material announcement, separate filings by both companies to the stock exchange showed. The private equity firm might make an offer of around RM2.50 per share to shareholders of HELP, said the source without elaborating. (Source: The Star) Foreign News U.S. Stocks Drop on Fed Stimulus Bets Amid Budget Talks U.S. stocks fell a fourth day, the longest slump in 10 weeks for the Standard & Poor s 500 Index, as investors weighed economic data for clues on the timing of Federal Reserve stimulus cuts amid optimism over a budget deal. The S&P 500 fell 0.1 percent to 1, at 4 p.m. in New York. The gauge fluctuated during the session, rising as much as 0.3 percent and declining 0.9 percent at its lowest. The Dow Jones Industrial Average dropped points, or 0.2 percent, to 15, About 6.6 billion shares changed hands on U.S. exchanges, 7.6 percent above the three-month average. European Stocks Advance Before U.S. ADP, Home Sales Data European stocks declined for a fourth day, their longest losing streak in more than five months, as better-thanexpected U.S. jobs data fueled concern the Federal Reserve will pare stimulus measures sooner than forecast. The Stoxx Europe 600 Index slid 0.6 percent to at the close of trading, after earlier losing as much as 1.1 percent. The benchmark fell 1.5 percent yesterday as investors weighed valuations before U.S. jobs data this week. It has gained 13 percent this year as central banks around the world pledged to keep interest rates low for a prolonged period. Emerging Stocks Decline After U.S. Data as Rand Tumbles Emerging-market stocks declined to a three-week low after better-than-estimated U.S. data bolstered speculation the Federal Reserve will reduce stimulus. South Africa s rand slumped to the lowest level since The MSCI Emerging Markets Index fell 0.7 percent to The Czech PX Index decreased 1.1 percent after a report showed the nation s economy contracted for a seventh quarter. The Shanghai Composite Index rose 1.3 percent, led by companies linked to Shanghai s free-trade zone, after the central bank said it plans to

4 implement reform measures for the area within three months. The rand retreated for a third day amid the longest selloff of South African bonds in five years. Treasury Yields Climb to 11-Week High as ADP Spurs Jobs Optimism Treasuries slid, pushing 10-year yields to the highest level since September, as industry data showed job growth accelerated more than forecast, adding to bets the Federal Reserve may reduce bond purchases this month.the difference in yields on two- and 10-year notes approached the widest level since July 2011 as the ADP Research Institute said companies in the U.S. boosted payrolls in November by the most in a year. The Labor Department will report Dec. 6 that U.S. nonfarm payrolls grew last month, a Bloomberg survey forecast. Fed policy makers meet Dec Moody s Boosts Spain s Credit Rating Outlook on Growth Prospects Moody s Investors Service increased Spain s credit rating outlook to stable from negative amid evidence of a sustained economic rebalancing and improving growth prospects.the nation s Baa3 rating, the lowestinvestment grade ranking, was also affirmed by New York-based Moody s, according to a statement yesterday. Spain s economy emerged from a two-year recession in the third quarter as household spending grew for the first time in more than a year, data showed last week. The government forecasts that next year economic growth will be strong enough to create jobs, even as the International Monetary Fund predicts unemployment won t fall below 25 percent until (Source: Bloomberg) Futures Kuala Lumpur Composite Index Futures Crude Palm Oil *As at 8.00am 5 December 2013

5 Technical Review: FBM KLCI Index Closing: Support: (S1) 1800 / (S2) 1780 Resistance: (R1) 1826 / (R2) 1840 Comments: The FBM KLCI fell 2.39 points to points. Technical indicators are mixed with the RSI hovering below the overbought zone while the MACD crossed above its signal line. In early May, the index rallied to an all time high of points after the general election but has since been moving sideways until August s selldown to a 4-month low followed by a rebound in September. The index is hovering around 1800 points and we expect consolidation with an upward bias with support of 1800 points and resistance of 1840 points. FKLI Spot Month Contract FKLI Closing: Support: (S1) 1775 / (S2) 1750 Resistance: (R1) 1828 / (R2) 1834 Comments: The spot-month FKLI futures added 0.50 points to points. The contract represents 6.40 points discount to the cash market compared to 9.29 points discount in the previous trading day. Technical indicators are mixed with the RSI hovering in the neutral zone while the MACD climbed above its signal line. We expect consolidation below resistance level of 1828 points with an upward bias

6 3 rd Month Crude Palm Oil Contract CPO Closing: RM2656 Support: (S1) 2630 / (S2) 2505 Resistance: (R1) 2690 / (R2) 2755 Comments: The 3rd month CPO futures contract rose RM39 to RM2656. Technical indicators are mixed with the MACD crossing below its signal line from below while the RSI hovered below the overbought zone. The rally since last month failed to beat the resistance of RM2630 and remains in the long-term sideways trend since October We expect the support level of RM2630 to hold before embarking on an up-trend. The contract needs to breach the RM2690 resistance level to kick start its rally.

7 JF APEX SECURITIES BERHAD CONTACT LIST JF APEX SECURITIES BHD Head Office: 6 th Floor, Menara Apex Off Jalan Semenyih Bukit Mewah Kajang Selangor Darul Ehsan Malaysia General Line: (603) Facsimile: (603) PJ Office: 15 th Floor, Menara Choy Fook On No. 1B, Jalan Yong Shook Lin Petaling Jaya Selangor Darul Ehsan Malaysia General Line: (603) Facsimile: (603) DEALING TEAM Head Office: Kong Ming Ming (ext 3237) Shirley Chang (ext 3211) Norisam Bojo (ext 3233) Wong Wing Haur, Alvin (ext 3226) Institutional Dealing Team: Lim Teck Seng Sanusi Bin Mansor (ext 740) Fathul Rahman Buyong (ext 741) Ahmad Mansor (ext 744) Lum Meng Chan (ext 743) Zairul Azman (ext 746) PJ Office: Mervyn Wong (ext 363) Mohd Hanif Wan Said (ext 111) Fong Jia Wen (ext 822) Nursyazaleen Hazwani (ext 362) RESEARCH TEAM Head Office: Lee Chung Cheng (ext 758) Lee Cherng Wee (ext 759) Jessica Low Jze Tieng (ext 756) Soong Wei Siang (ext 754) Gabriela Fang Minn Fern (ext 753) Elliya Harisna binti Junaedi (ext 752) JF APEX SECURITIES BERHAD - DISCLAIMER Disclaimer: The report is for internal and private circulation only and shall not be reproduced either in part or otherwise without the prior written consent of JF Apex Securities Berhad. The opinions and information contained herein are based on available data believed to be reliable. It is not to be construed as an offer, invitation or solicitation to buy or sell the securities covered by this report. Opinions, estimates and projections in this report constitute the current judgment of the author. They do not necessarily reflect the opinion of JF Apex Securities Berhad and are subject to change without notice. JF Apex Securities Berhad has no obligation to update, modify or amend this report or to otherwise notify a reader thereof in the event that any matter stated herein, or any opinion, projection, forecast or estimate set forth herein, changes or subsequently becomes inaccurate. JF Apex Securities Berhad does not warrant the accuracy of anything stated herein in any manner whatsoever and no reliance upon such statement by anyone shall give rise to any claim whatsoever against JF Apex Securities Berhad. JF Apex Securities Berhad may from time to time have an interest in the company mentioned by this report. This report may not be reproduced, copied or circulated without the prior written approval of JF Apex Securities Berhad. Published & Printed by: JF Apex Securities Berhad (47680-X) (A Participating Organisation of Bursa Malaysia Securities Berhad)