KUALA LUMPUR, July 30 (Bernama) -- Bursa Malaysia's key index closed at an intraday high today, supported by continued buying interest even as renewed geopolitical tensions and a weaker overnight lead from Wall Street following the US Federal Reserve's (Fed) decision to stand pat on interest rates weighed on broader sentiment. The Fed has decided to hold rates steady for the fifth consecutive meeting, with the Federal Funds Rate unchanged between 3.50 per cent and 3.75 per cent. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 4.84 points to 1,720.40 from yesterday’s close of 1,715.56. The benchmark index, which opened 1.14 points lower at 1,714.42, hit its lowest level of 1,710.69 in early trade before gaining momentum for the rest of the day. However, the broader market was negative with losers outpacing gainers 581 to 411, while 612 counters were unchanged, 1,173 untraded, and 87 suspended. Turnover declined to 2.49 billion units valued at RM2.25 billion from ...
Shares of Seng Fong Holdings Bhd (KL) soared to their highest level in two weeks on Wednesday, after the rubber processing company reported a record annual profit for FY2024.
Key Highlights:
Stock Surge: Seng Fong’s shares climbed as much as 5% or six sen to RM1.25, marking the stock’s highest level since July 30, 2024. By 9:30 am, the shares were trading at RM1.22, giving the company a market capitalization of RM880 million. Trading volume spiked, with over 2.48 million shares exchanged, surpassing the 200-day moving average.
Record Profit: Seng Fong reported a net profit of RM57.3 million for FY2024, more than doubling the RM22.6 million profit from FY2023. This marks a new high for the company since its listing in 2022. The company attributed this significant profit increase to the integration of a biomass system, which reduced diesel costs, and the extension of production hours.
Earnings Growth Drivers: According to Apex Securities, the sole research house covering the stock, Seng Fong’s earnings growth will be driven by a gradual increase in production capacity and margin expansion through the integration of biomass systems and smart equipment. Apex Securities maintained its ‘buy’ rating on the stock with a target price of RM1.90.
Production Capacity Expansion: Seng Fong has been steadily increasing its production capacity. For FY2024, the company’s total annual production rose to 190,000 metric tons, up from 166,000 metric tons in FY2023. Apex Securities forecasts that the company will further increase its capacity to 200,000 metric tons in FY2025 and 210,000 metric tons in FY2026.
Rubber Price Impact: The company, which processes raw rubber into intermediate blocks for manufacturers like tire makers, has benefited from rising rubber prices. The SMR 20 grade has climbed approximately 12% this year to 781.50 sen per kilogram, supporting the company’s profitability.
Future Outlook: For FY2025, Seng Fong is expected to achieve a net profit of RM72.2 million, driven by capacity expansion and cost savings from full utilization of the biomass system and smart equipment integration.
Conclusion: Seng Fong’s strong performance and strategic investments in technology and capacity expansion have positioned the company for continued growth, with analysts maintaining a positive outlook on its future earnings potential.
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