KUALA LUMPUR, Sept 8 (Bernama) -- Bursa Malaysia closed almost flat on Tuesday as buying interest rotated away from index heavyweights towards smaller-cap construction stocks, with sentiment affected by geopolitical uncertainty, said an analyst. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) eased 0.39 of a point to 1,714.40 from Monday’s close of 1,714.79. The benchmark index opened 1.65 points lower at 1,713.14 and moved between 1,710.44 and 1,714.50 throughout the trading session. The broader market was almost evenly balanced, with decliners leading gainers 548 to 546, while 598 counters were unchanged, 1,107 were untraded and 25 were suspended. Turnover expanded to 4.13 billion units valued at RM3.14 billion from 3.60 billion units valued at RM2.45 billion on Monday.
SP Setia surprised us with a proposed renounceable rights issue of up to 1,069,686,243 new Islamic redeemable convertible preference shares (“RCPS-i”) on the basis of two RCPS-i for every five existing ordinary shares. The cash call is expected to raise a minimum of RM536.6m to as much as RM1.07bn. We understand that the proceeds will be used for projects and working capital requirements, though some are also earmarked for future property development and expansion plans. With net gearing of 0.2x and unbilled sales of RM8.6bn, this came as a negative surprise for the Group to tap the equity market currently. All told, this cash deal will be dilutive to our RNAV, and hence adjusted our TP to RM3.70 (from RM3.85 previously) to account for the rights issue with c.20% discount to RNAV. Our Outperform call is retained. To raise up to RM1.067bn . The rights issue via the issuance of 1,069,686,243 new ICPS-i shares in SP Setia is priced at ...