Counters linked to Taib see selling pressure on news he may step down
BY YVONNE TAN
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PETALING JAYA: Sarawak-linked counters were sprinkled across the loser’s list of stocks on Bursa Malaysia following news that Chief Minister Tan Sri Abdul Taib Mahmud(pic) might step down soon.
Cahya Mata Sarawak Bhd (CMSB), which is some 43% owned by Taib’s family, was among the biggest losers of the lot, finishing 2.6% down to RM7.24.
The company, which started out as a cement manufacturer and has since moved into other industries such as construction, property and financial services, has often been seen as the main beneficiary of large projects in the state by virtue of its political connections.
A top performer last year, CMSB appreciated by some 105% last year alone. The stock remains 6% higher year to date.
Apart from CMSB, another Sarawak-linked counter, property developer Naim Holdings Bhd also finished yesterday’s trade 0.57% lower to RM3.50.
Additionally, shares of Naim’s unit – oil and gas-related outfit Dayang Enterprise Holdings Bhd – finished 1.91% lower to RM3.60. Dayang shares had also performed well last year after clinching some significant oil and gas services-related contracts from oil majors.
Other counters which reflected the same weak sentiment were timber companies Ta Ann Holdings Bhd, Jaya Tiasa Holdings Bhd and WTK Holdings Bhd, which all closed trading yesterday lower by at least 0.44% each.
A local daily, quoting a source, reported yesterday that Taib would announce his decision to retire at Barisan Nasional’s central working committee meeting this weekend.
Analysts said while yesterday’s fall in most Sarawak counters could be merely a knee-jerk reaction, some investors were using the opportunity to take profit, especially in counters like CMSB which was among the star performers of the stock market last year.
“Furthermore, the outlook of the market remains murky for now largely as a result of external factors, so it’s better to take profit,” said another market analyst.
He said it was unlikely that a major sell-down in Sarawak counters would occur, if Taib were to step down as he had already expressed his intention to step down from politics as early as 2011.
Danny Wong, fund manager at Areca Capital which has investments in certain Sarawak counters including CMSB, told StarBiz that he was not switching or selling down any Sarawak stock just yet.
“We buy on fundamentals, not on politics and besides, this is not official news,” he said,
Still, in the event the news becomes official, Wong said he would re-visit his entire Sarawak investment theme to assess the impact on the investments.
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