With so many funds available in the market today, just comparing them can be a headache. Of course if you are in the financial industry and have access to the Lipper rankings things can be a little simpler; but to an average Joe (or Mat in Malaysia) the maze can be very tricky.

Here is an example; (since I am quite familiar with MAAKL Unit Trust Funds I will use them). Below are six of MAAKL Unit Trust Funds.


Which one of these fund a better investment?

First look .. would be MAAKL Value Fund after all that is the best return above: one year 30.79%, five years 152.48%. (Note most funds in Malaysia drop in the 3 years return).

Would that be the right answer?

No not really.

First lets look at the fourth column VC/VF (Volatility Category/Volatility Factor). This figure tell us how volatile each fund is. Rule of thumb would be as follows:


How does this figure help us in picking the best fund?
Step 1: Take the return
Step 2: Minus the risk free rate (normally the FD Rate) however for my calculation I take the EPF dividend rate (which is higher)
Step 3: Divide this figure with the VF

Example calculation: MAAKL Dividend Fund - 1 Year
1 year return= 27.55%
Less 1 year EPF return of 5.65% = 21.90%
Dividing by VF 21.90 ÷ 10.5 = 2.100
The sharpe ratio of 2.100 means for every RM1 you risk you can get RM2.100 in return

By running the same calculation to all the funds the ranking will be as follows:


From here we can see that Dividend fund is the better fund to buy. You can try this calculation to any fund house.

The Original Article can be accessed directly from the Edge Website

When Maxis Communications Bhd or “the old Maxis” debuted on the Main Board in July 2002 with just over three million subscribers, the country’s mobile penetration rate was under 40%. By the time it was privatised five years later in July 2007, Malaysia’s mobile penetration rate had gone just above 90% and its subscriber base had more than tripled.

Growth numbers made headlines and its Ebitda (earnings before interest, tax, depreciation and amortisation) margin of over 50% was the envy of most of its peers, both locally and abroad.

Between 2006 and 2008, Maxis’ revenue grew 21.5% to RM8.45 billion in FY2008 from RM6.96 billion in FY2006, even as its mobile subscriber base expanded around 18% a year to 11.2 million users in December 2008 from 8.1 million users in December 2006. Mobile revenue, which made up over 90% of Maxis’ group revenue, grew 20.4% to RM7.9 billion in 2008 from RM6.5 billion in 2006.

Today, thanks to people who carry more than one mobile phone, Malaysia’s mobile penetration rate is already above 100%, alongside the likes of Singapore, Hong Kong, Taiwan and Australia. Mobile operators are now looking to services such as mobile broadband as well as value-added 3G data services to grow or maintain average revenue per user (ARPU) numbers.

Packages for enterprise users have turned more competitive following the introduction of mobile number portability (MNP) last October. The battle for price-sensitive prepaid users has also become cut-throat, with at least four active mobile virtual network operators (MVNO) selling rebranded mobile services riding Celcom (M) Bhd’s network.

And it is in this scenario of a highly competitive, near-saturated market that Maxis Bhd or “the new Maxis” is seeking to list on the Main Board — without its sister companies in India and Indonesia that are still in the red due to start-up losses.

Given tougher market conditions, the question is, what kind of growth can Maxis deliver in the current environment?

Investors who follow Maxis would remember that Axiata Group Bhd’s group chief executive Datuk Jamaludin Ibrahim, the “face of Maxis” for 10 years until July 2007, had used the words “pressure cooker” to describe how it felt like to be faced with the need to deliver growth “quarter after quarter after quarter” for some 40 consecutive quarters.

In fact, delivering in terms of growth and dividend was so much expected of Maxis that everyone missed the fact that it made more sense for billionaire businessman T Ananda Krishnan to privatise Maxis and use the more than RM1 billion cash a year it was paying as dividend to fund growth in India and Indonesia. And the surprise privatisation bid came in May 2007 and its partnership with state-owned Saudi Telecom Co Ltd soon thereafter.

From the growth that Maxis has delivered over the past two years under its new group CEO, Sandip Das, the need to perform remains imperative. Maxis is, after all, still “an AK company”.

In Malaysia, Maxis is still the leading mobile operator, with its 11.25 million subscriber base, commanding 40% of the market, ahead of Celcom’s 34%, DiGi.Com Bhd’s 25.3% and U Mobile Sdn Bhd’s 0.7%. Maxis’ revenue market share also remains the largest, at about 41%, versus Celcom’s 33% and DiGi’s 25%.

Rivals catching up
However, due to competitive pressures, Maxis’ Ebitda margin fell to 50.6% for the six months ended June 30, 2009, from the 54.2% it enjoyed in the previous corresponding period. Maxis is not alone. DiGi’s Ebitda margin for the 1HFY2009 was also lower y-o-y at 43.9% compared with 47.2% before, mostly due to higher sales and marketing costs. Celcom’s slide, however, was relatively smaller, down less than one percentage point y-o-y to 44.6% for 1HFY2009 from 45.5% before.

There are signs of Maxis’ dominance coming under threat.

Maxis’ postpaid ARPU is still the highest in the industry, at RM102.9 per month, compared with Celcom’s RM94 and DiGi’s RM82. But its postpaid revenue market share has slipped below the 50% mark. Maxis is also no longer the leader in terms of prepaid ARPU.

Notwithstanding the size of the subscriber base, DiGi’s prepaid ARPU was at RM49 per month in 2QFY2009, ahead of Celcom’s RM42 and Maxis’ RM41.6 per month. This has caused Maxis’ dominance in terms of blended ARPU, or the average amount that each of its mobile subscribers spends a month, to narrow. Maxis’ blended ARPU stood at RM56.50 end-June, slightly ahead of DiGi’s RM54.40 and Celcom’s RM53.50.

Maxis was also the only one of the big three operators to lose prepaid subscriber market share in 1H2009. It lost 66,200 prepaid users in the six months ended June 30, 2009, but its total subscriber base still grew during the period, thanks to the 223,900 postpaid subscribers it added. Still, while its postpaid net additions were ahead of DiGi’s 77,000 users, Celcom grew faster by adding 384,000 postpaid users over the same period. And Celcom added 553,000 prepaid users at the same time, well ahead of DiGi’s 91,000 users.

Celcom has made known its intention to unseat Maxis as market leader by 2011. As at June 30, 2009, Maxis, with 11.42 million mobile phone subscribers, had a 1.72 million user lead on Celcom’s 9.7 million users, while DiGi’s base stood at 7.23 million.

One of the factors which caused some Maxis prepaid users to opt out earlier this year was its failed strategy to change its billing period to 60-second from 30-second blocks, which effectively meant users who made short calls had to pay for more unused talk time. This has since been reversed but it remains to be seen if Maxis can successfully retain its dominant lead on rivals.

Maxis, whose average monthly blended churn (subscriber drop-out) rate jumped to 4.2% for the six months ended June 30, 2009 (from 3.6% in 2008), expects the churn rate to “continue to be under pressure with the entrance of MVNOs and intensifying competition”.

In terms of mobile broadband users, Celcom has been more successful in growing its subscriber base.

As at end-June, it had 420,000 mobile broadband users, more than double Maxis’ 171,200 users. DiGi, which launched its 3G mobile broadband service in March this year, had 11,000 users end-June. Both Celcom and Maxis launched 3G in 2005. But the fact remains that Celcom has the largest pool of 3G mobile broadband users regardless of whether there is merit in the argument that it costs too much for operators to upgrade their network to justify taking in a lot of users who want quality but are not willing to pay a lot of money. There is also competition from four WiMAX licensees on this front.

Where would growth come from?
In its exposure draft listing prospectus (not yet registered by the SC and may still be subject to amendments), posted on the Securities Commission Malaysia website on Sept 17 for public comment until Oct 12, Maxis said it believes there is still “significant future growth opportunities” in the less penetrated regions of Sabah and Sarawak, the east coast of Peninsular Malaysia as well as the youth segment, although SIM card penetration has exceeded 100%.

“Maxis believes Malaysia’s demographic profile, whereby 50% of its population is estimated to be under 25 years of age, provides opportunities for growth both in terms of subscribers and adoption of new data services,” the exposure draft prospectus read.

Maxis also said it saw a 31.1% subscriber growth in the SME segment and 24.1% subscriber growth in the corporate sector between 2007 and 2008, adding that it intends to “consolidate its market leadership in the mobile market” through “a combination of strategies” to preserve and enhance cash flow generation, as well as to “address tangible growth opportunities in areas such as data and broadband”.

Nonetheless, the fact remains that competition is getting tougher and margins are being eroded. Without the potential growth factor from markets abroad, Maxis’ valuations would likely be closely tied to its ability to generate cash and pay dividends.

These factors would likely not be missed by investors as they weigh how much they are willing to pay for Maxis shares being offered for sale. The indicative IPO price for institutional investors is RM5.50 apiece, according to OSK Research. The research house considers RM5.50 a share for institutions (and RM4.95 a share for retail investors) to be “fair” as it would imply an equity valuation of RM37.1 billion or 16.3 times annualised 1HFY2009 earnings and nine times EV/Ebitda.

“The valuation is on a par with the prospective PER of 14 to 16 times at which domestic and regional mobile companies are trading, albeit at a premium to regional 5.2 times EV/Ebitda. We deem this fair considering Maxis’ superior Ebitda margin of over 50%,” OSK says in a note dated Sept 23.

ECM Libra Research reckons that Maxis will be priced at RM5.60 apiece, being 18 times earnings, but estimates that the final price could range from RM5.20 to RM6.20, being 16 to 20 times FY2010 estimated earnings.

Affin Investment Research and HwangDBS-Vickers Research had more conservative valuations. Affin puts Maxis’ price range from RM3.67 to RM4.40, assuming between 5% and 6% yield. HwangDBS-Vickers’ estimated range of RM4 to RM4.70 was arrived at using an array of valuation methods derived from a target market capitalisation of between RM30 billion and RM35 billion.

Back-of-the-envelope calculations using Maxis’ annualised 1HFY2009 net profit numbers and its 75% dividend payout commitment price Maxis between RM3.80 and RM5.70 apiece, assuming yields of between 4% and 6%. This price range would imply valuations of between 12.5 and 18.7 times annualised 1HFY2009 earnings per share of 30.43 sen, and EV/Ebitda multiples of between 7.81 and 11.13 times. Market capitalisation would be between RM28.5 billion and RM42.75 billion at this price range.

DiGi, which closed at RM21.32 last Friday, was trading at 15.6 times FY2009 earnings and 7.25 times FY2010 EV/Ebitda, according to Bloomberg data. Singapore’s MobileOne Ltd (M1), another yield-stock, was trading at 11.02 times FY2009 earnings and six times EV/Ebitda. Closing at S$1.84 last Friday, M1’s indicative yield was at 7.3%, according to Bloomberg data.

Notably, Maxis’ actual FY2010 earnings would see higher finance costs from the RM5 billion loan it is seeking to repay its parent company, among other things.

To match the old Maxis’ market capitalisation of RM39 billion at the point of privatisation, the new Maxis shares will need to be quoted at least at RM5.20 apiece.

The final retail and institutional price would be decided after a book-building exercise by joint global coordinators and book-runners CIMB Investment Bank Bhd, Credit Suisse (Singapore) Ltd and Goldman Sachs (Singapore) Pte Ltd.

While a straightforward Main Board listing would take some four to six months and the company will have six months from the date of approval to decide the listing date, expectations are that Maxis will be listed by year-end and be in time for inclusion into the 30-stock bellwether FBM KLCI at its upcoming constituent review in December.

To qualify for inclusion, Maxis needs to be listed by Nov 26 as the constituent review will be done using full market capitalisation data at the last trading day of November. Any constituent change in the upcoming semi-annual review will take place effective Dec 21.

In any case, Maxis’ relisting — first announced by Prime Minister Datuk Seri Najib Razak on July 21 — would boost Malaysia’s current total market capitalisation of RM920 billion by between 3.8% and 4.3%. This assumes a RM35 billion to RM40 billion market capitalisation, which prices Maxis at between RM4.67 and RM5.33 apiece. The boost to the FBM KLCI’s market capitalisation, which stood at RM368 billion last Friday, would be greater at about 9.5% to 10.9%.

Be that as it may, the absence of the potential growth factor from markets abroad and heightening competition in a near-saturated market at home mean it would be tough for the “new Maxis” to outshine the “old Maxis”.


This article appeared in The Edge Malaysia, Issue 774, Sep 28-Oct 4, 2009.

The original article can be accessed from the Edge Website

Two years after taking Maxis private, low-profile tycoon Ananda Krishnan is relisting the leading cellular network operator. The exercise will potentially see the parent company Binariang GSM degear and leave it in a solid financial position to expand its international telecoms business. The key lies in the value that the market attaches to Maxis.

When none other than the prime minister announces the listing of a company, it will attract more than the normal attention.

That was the case when Datuk Seri Najib Tun Razak, during a visit to Saudi Arabia in July, expressed to top executives of Saudi Telecom Co (STC) his wish to have Maxis Communications relisted on Bursa Malaysia.
STC has a 25% stake in Binariang GSM Sdn Bhd, the parent company of Maxis.

This immediately got CIMB Investment Bank (the lead adviser for Maxis Bhd’s listing) working round the clock. The draft prospectus of Maxis’ initial public offering (IPO) was submitted to the Securities Commission Malaysia in record time — Sept 17.

On the face of it, it may appear that T Ananda Krishnan, the low-profile billionaire who is controlling shareholder of Binariang and Maxis, was nudged by Najib to relist the company he took private just two years ago in a RM39 billion exercise.

After introducing a series of measures to liberalise the local stock market upon becoming prime minister in April, Najib needed a mega listing to give Bursa a boost. The problem was, there were not that many big and quality private Malaysian companies available for listing.

So, he turned to an old investor favourite — Maxis.

That said, Ananda will not lose out even though his original plan might not have factored in such an early relisting of Maxis. Indeed, he gains big time on three counts.

First, he is relisting only his Malaysian telco assets whereas the Maxis he took private in 2007 included international assets.

Second, through a series of deft pre-IPO restructuring, Binariang, which he controls privately, will raise billions in cash that will enable him to retire virtually all the debt he and Binariang had taken to privatise Maxis if he chose to. In short, Binariang will be able to pay the bulk of its debts and still end up controlling 70% of the relisted Maxis.

Third, Ananda will score brownie points with Najib, who is also finance minister and who wants to put Bursa back on the radar screen of international fund managers the way Malaysia was in the 1990s. To achieve this, Bursa needs more profitable big companies.

Sources familiar with Ananda’s companies, which include listed Tanjong plc, Astro All Asia Networks plc and Measat Global Bhd, say Najib expressed his wish about the same time there was a need for Binariang to restructure its debts.

Binariang has ringgit-denominated debts of RM21 billion and US dollar-denominated debt paper of US$900 million. Sources say Binariang needed to shore up its balance sheet to continue to enjoy a debt rating of AA (2) and A (3) respectively for the ringgit and US dollar debts.

They say Binariang needed to inject more money into its Indian telco Aircel Cellular Ltd (Aircel), but it would have been difficult for it to borrow unless it restructured its existing debt. They also say the global financial crisis meant bank borrowings had become more difficult and expensive.

Financing needs
Those close to the deal say the Najib factor was not the cause for Ananda’s early relisting of Maxis.

“[It was] a combination of the financial crisis, which made US dollar borrowing expensive, and Maxis’ Indian operations requiring capital to expand market share that led to the restructuring of Maxis and listing of its Malaysian arm,” says a banker.

The Indian operation is key to Ananda’s realising his dream to have a cellular mobile empire with strong presence across Asia. When Maxis was taken private in 2007, it was primarily because the listed company would incur massive debt due to its operations in India and Indonesia, something that would dampen its share price performance. Moreover, the cash being paid as dividends could be used to fund expansion.

Binariang later sold a 51% interest in its Indonesian arm PT Natrindo Telepon Seluler to STC, leaving it and Maxis with Aircel as its major overseas investment.

As at end-December 2008, Aircel is the seventh-largest mobile wireless service provider in India, with 16 million subscribers or 4.6% market share.

While Aircel is not in the big league in terms of market reach, it has been expanding since Maxis acquired it in 2006. In 2008 alone, Aircel added 6.65 million subscribers to its operations, which cover 10 of the 23 regions in India.

Aircel has set a target of 29 million subscribers, with operations in 18 regions, by end-2009, which seems to be too ambitious as it had only 18.5 million users in 15 regions as at end-March 2009.

Although the potential for growth in the Indian market is very high, competition is heating up. There are five players with bigger market share than Aircel in India. Bharti Airtel leads the pack.

To compete aggressively, Aircel needs more capital, an aspect not all shareholders of Binariang may be comfortable with.

The biggest shareholder of Binariang is Ananda, with a 37% stake via Usaha Tegas Sdn Bhd, followed by Harapan Nusantara Sdn Bhd, with 30%. STC holds a 25% equity stake while Shield Estate NV, a vehicle linked to Ananda, has 8%.

Among the directors of Harapan Nusantara are former inspector-general of police Tun Mohamed Hanif Omar and Astro chairman Datuk Badri Masri. Both men have been long-time bumiputera partners of Ananda.

According to Rating Agency Malaysia (RAM), Aircel’s capital expansion programme over the next four years is about RM16.4 billion and this is expected to be primarily financed via additional equity and/or debt.

“In line with Aircel’s funding needs, the group’s [Binariang] debt load is expected to balloon to around RM25 billion in 2010 [from RM21 billion as at end-December 2008],” RAM stated in a note in July.

It was the rating rationale that gave the market the first indication of the need for Binariang to undergo a restructuring to give Aircel additional funds to accelerate expansion.

RAM stated that on account of a ballooning debt load and a fairly saturated and mature operating environment in Malaysia, a strong uptick in Aircel’s cash-generating ability was imperative to sustain the group’s rating.

To this end, RAM said Binariang has provided a formal commitment to preserve the group’s debt-protection measures and balance sheet at levels that commensurate with the ratings via shareholders’ staggered equity injections or subordinated loans, either for Binariang or its subsidiaries.

That got the market talking of an impending relisting of Maxis.

OSK Research was the first to come out with a report speculating the possibility of Maxis being injected into Astro. Talk also surfaced that the group’s wide restructuring would include satellite operator Measat.

In the end, it turned out to be a straight-forward listing of Maxis’ Malaysian cellular business.

Meanwhile, Astro’s board is still evaluating proposals to optimise its capital and operating structure. No details have been announced at press time.

Pre-IPO restructuring
The restructuring and relisting of Maxis are being done in a manner that will solve Binariang’s balance sheet and funding woes and give the company the flexibility to expand in India and other countries without burdening shareholders.

According to the exposure draft IPO prospectus, Maxis Communications Bhd (MCB) will list its Malaysian arm Maxis Bhd by divesting 30% or 2.25 billion shares to investors. MCB is wholly owned by Binariang.

Assuming the sale is done at RM5 per share (the low end of analysts’ expectation, which is as high as RM6 a share), the divestment will net MCB some RM11.3 billion and value the Malaysian assets at RM37.7 billion. This compares with the RM39 billion valuation of Maxis that included its entire Malaysian and overseas assets when it was taken private.

Also, prior to the relisting, MCB is undergoing a restructuring that will see Maxis acquiring assets from the parent (MCB) for close to RM4 billion and also receiving a dividend payment amounting to RM4.03 billion.
According to the prospectus, as a result of the pre-listing restructuring, Maxis will owe MCB RM4.99 billion. Maxis will seek a RM5 billion long-term external debt to repay the debt.

Apart from that, four subsidiaries of MCB — Maxis Mobile Services, Maxis Broadband, Maxis Mobile and Maxis International — have declared dividends to MCB to the tune of RM4.03 billion before the upcoming listing.

Of this amount, some RM2.84 billion was paid in cash. The remaining RM1.18 billion will be settled by Maxis from the RM5 billion borrowing.

According to the prospectus, the dividends were declared by utilising the retained earnings of the four subsidiaries, which will come under the Malaysian arm of Maxis after the listing.

Apart from dividends from the four subsidiaries, Binariang also received dividends to the tune of RM290 million in respect of redeemable convertible preference shares in Maxis Broadband.

Ananda comes out tops
In a nutshell, even prior to the listing, MCB (which is 100% owned by Binariang) will receive RM7.84 billion in dividends and divestment of assets arising from the pre-listing restructuring. Together with the RM290 million that Binariang received for its preference shares, the total sum MCB will pay the holding company is more than RM8 billion.

Add the post-IPO proceeds of some RM11.3 billion (assuming the sale of 30% of Maxis is done at RM5 per share) to the RM8 billion and the total proceeds that Binariang will get are more than a whopping RM19 billion. That is not too far off the cost incurred by Ananda and Binariang when they took Maxis private.

Then, Binariang had piled on ringgit debt papers of RM21 billion that were used to buy out the old Maxis’ minority shareholders.

That being the case, what is the upside for Ananda and Binariang after Maxis Bhd is relisted?

Plenty.

“When Maxis was taken private, it had both the international and local businesses. Now, only the local arm is being relisted and the proceeds received will almost cover the debt incurred in taking Maxis private, if the shares are sold at RM5 and above,” says a banker.

Effectively, if the shares are sold at RM5, this will value the Malaysian operations at RM37.7 billion. When Maxis was privatised at RM15.60 per share, the company’s market capitalisation stood at RM39 billion.

Also, after taking Maxis private, STC invested a total of US$3.1 billion to take a 51% stake in Maxis’ Indonesian operations — which was the group’s Achilles’ heel — and a 25% stake in Binariang. This was done via an issue of new shares, which meant the money went to Binariang’s coffers, hence reducing its cost of taking the old Maxis private by some RM10 billion.

The funds from STC are said to have been channelled into Binariang’s overseas operations. Also, STC, together with Binariang, jointly underwrote a US$900 million loan for the Indian expansion.

“If Ananda can raise enough funds from the relisting to pay off the ringgit papers raised to fund the privatisation of Maxis, he will free Binariang from a substantial amount of debt and still end up owning 70% of a listed Maxis and 100% of MCB’s overseas arm,” says the banker.

Will Maxis fetch a good price?
But the question is, will Maxis be able to list at RM5 a share or more?

So far, based on investment analyst reports, the valuations given to Maxis range from RM4 to RM6, depending on the kind of valuation methodology applied.

According to merchant bankers, if Maxis is valued based on enterprise value/earnings before interest, tax, depreciation and amortisation (EV/Ebitda), a RM5 tag is too high as it would translate to more than nine times EV/Ebitda. (This is based on the Ebitda of RM4.4 billion Maxis registered for FY2008 ended Dec 31.)

By comparison, China Mobile, a hot favourite of fund managers, is trading at less than five times EV/Ebitda while Bharti Airtel is trading at 8.3 times.

A more decent value, some say, will be closer to RM4 a share, which would bring down its EV/Ebitda valuation to less than seven times. This is about the valuation that Singapore’s Mobile One, which is essentially a low-growth cellular service provider, currently commands.

On the other hand, if Maxis is positioned as a dividend play, it can fetch a higher price of about RM5 a share, analysts say.

But then, they add, if an investor is looking at dividend play, there are other options available such as Axiata and DiGi (see separate story on Maxis valuations). So really, the question that begs to be answered is, what’s the true value of Maxis?

Whatever the valuation, what will comfort investors is that Ananda has a record of creating value for his shareholders.

When he took Maxis private, it was at an EV/Ebitda of more than 10 times, a price- earnings multiple of 18.3 times and the offer price of RM15.60 was the highest the stock ever achieved after it was listed in 2002.

Many funds, such as the Employees Provident Fund (EPF) and Lembaga Tabung Haji, made respectable profits from their Maxis shares when it was taken private. So did retail investors.

Ananda, who is close to former premier Tun Mahathir Mohamad, was considered to have been generous with his Maxis privatisation offer to his shareholders.

The only blemish was that just a month later, he drew scrutiny when STC came into the picture, paying US$3.1 billion for stakes in Binariang and its Indonesian operations. Cynics had said Ananda had taken Maxis private to enable him to sell a stake in Binariang to STC at a premium.

But those close to him said STC did not come in at a premium. Observers also pointed out that without taking Maxis private, Ananda would not have been able to bring in STC as a partner without reducing his interest in Binariang and Maxis.

“That was why he had to take it private,” says a source.

So, with Maxis, albeit just its Malaysian assets, coming back to Bursa, will investors be willing to pay the price Ananda is seeking?

Ananda has shown from all his past deals, dating back to his takeover of the Selangor Turf Club land and its development into the Kuala Lumpur City Centre (KLCC) with the majestic Twin Towers, that he is able to get the price he wants for his assets. He sold his stake in KLCC to Petronas at an undisclosed price, but those close to him say he made a bundle.

Ananda may well get what he wants, even if Maxis is priced at a rather rich valuation.

Something that would help his cause is Bursa being hungry for a really big IPO. The last big one was the flotation of AirAsia Bhd in 2004.

And with Najib openly rooting for a Maxis listing, one can expect all the major local institutional funds to line up for its shares.

Original article can be accessed at
Business Times

The Amanah Saham 1Malaysia (AS 1Malaysia) unit trust starts selling today.

Malaysians aged 18 and above may subscribe for the units at RM1 each at Amanah Saham Nasional Bhd offices that provide a full range of services as well as the more than 1,600 agents, including Malayan Banking, CIMB Bank, RHB Bank and Pos Malaysia, nationwide.

The fund, with an approved fund size of RM10 billion, will be managed by state-owned investment fund manager Permodalan Nasional Bhd.

The public can invest in at least 100 units. First-year students in public universities will each be given 100 units free.

There will be no maximum limit for investors. However, for 30 days from today, there will be a maximum investment limit of 50,000 units.

During this period, Malaysians aged 55 and above will get a special offer: they can buy as much as 100,000 units each.

(Ranked by 12-Months Return)

Original Article can be read at:
The Edge

Permodalan Nasional Bhd (PNB) will open the remaining 1.6 billion units of Amanah Saham Malaysia (ASM) for subscription to all Malaysians beginning July 21, after the expiry of quota-based offer period on July 20.

These unsold units are part of the 3.33 billion additional ASM units announced on April 20. Of the 3.33 billion units, 50% was allocated for bumiputras, 30% for Chinese, 15% for Indians and the remaining 5% for other races.

"PNB had placed the quota for a period of three months in an effort to promote this fund to all races and to diversify investors' profile. We think this three-month period was sufficient to enable all to invest," PNB's president and group chief executive Tan Sri Hamad Kama Piah Che Othman said at a media briefing here on July 15.

"The quotas for Chinese and Indian had been fully taken up. But beginning July 21, those who want to invest more can do so," he added.

To ensure fair distribution to the investing public, each investor will be allowed to buy maximum 20,000 ASM units from July 21 to 27. The investment limit will be void after July 27. The purchase of ASM units will be on a first come first serve basis.

ASM is an equity-income fund launched in 2000 with a fund size of two billion units, which were fully subscribed in 21 days. Since its introduction, ASM had offered six additional launches with total units of 7.63 billion.

On the upcoming Amanah Saham 1Malaysia new fund announced by Prime Minister Datuk Seri Najib Razak on July 11, Hamad said it would be launched soon but details should be announced by Najib.

Original Article can be access at:
Bernama

KUALA LUMPUR, July 10 (Bernama) -- Over six billion units from various funds under Permodalan Nasional Bhd (PNB)'s Amanah Saham are still available for purchase by Bumiputeras and non-Bumiputeras.

PNB president/group chief executive, Tan Sri Hamad Kama Piah Che Othman, said among the funds available for Bumiputera investors included Amanah Saham Wawasan (1.7 billion), Amanah Saham Didik (1.6 billion), Amanah Saham Nasional (921 million), Amanah Saham Nasional 2 (2.2 billion) and Amanah Saham Malaysia (3.3 billion).

"Non-Bumiputera investors still have opportunity to invest in Amanah Saham Nasional 3 and Amanah Saham Gemilang, a variable-priced unit trust funds," he told a media briefing after the launch of Buku Sajak 30 Tahun PNB by its chairman, Tun Ahmad Sarji, here Friday.

According to Hamad Kama Piah, 3.3 billion units of Amanah Saham Malaysia for Bumiputeras might also be opened to all investors.

Meanwhile, he said, PNB planned to launch new products from time to time in order to encourage Malaysians to invest.

On when PNB would launch a new fund, he said: "We will announce as soon as possible."

A report in Berita Harian today said PNB was expected to launch another fixed-priced unit trust fund with an estimated size of RM3 billion soon.

Hamad Kama Piah said the establishment of Ekuiti Nasional Bhd (Ekuinas) would not overlap PNB's function but would complement one another.

"PNB will continue to look for opportunities that will provide better returns. We are focusing on managing unit trusts.

"We need investment either in listed or unlisted companies," he said.

He said Ekuinas could also invest in the same company that PNB invested as long as it benefited both parties.

Recently, the government announced the establishment of Ekuinas, a private equity fund with a paid-up capital of RM500 million.

Media released by Bursa Malaysia.
Original Article can be accessed at
Bursa Malaysia

Bursa Malaysia today reminded the market that its benchmark index, the Kuala Lumpur Composite Index (KLCI) will adopt FTSE’s global index methodology and will be renamed as FTSE Bursa Malaysia KLCI, starting on 6 July 2009 onwards.

The FTSE Bursa Malaysia KLCI will be free-float adjusted and liquidity-screened to give investors an investable and tradable index which remains characteristic of the underlying market. Constituents of the FTSE Bursa Malaysia KLCI will be made up of Bursa Malaysia’s 30 largest eligible Main Board companies. The computation is based on investable market capitalisation.

The calculation of FTSE Bursa Malaysia KLCI will be on a 15 second basis in comparison to 60 seconds adopted by KLCI currently. This improvement in speed of index calculation will essentially benefit the investors as they will be able to closely track the pulse of the market trading activity.

The opening index value on 6 July 2009 will remain unchanged and adopt the KLCI index closing value on Friday, 3 July 2009. For example, if the KLCI closes on Friday, 3 July 2009 at 1,000 points, the index will open on Monday, 6 July 2009 at 1,000 points. The computation of the index will then be based on the 30 constituents.

Subsequently with the transition, the FTSE Bursa Malaysia Large 30 Index will be retired on 6 July 2009. Following from the transition, the FTSE Bursa Malaysia 100 Index will be known as the FTSE Bursa Malaysia Top 100 and its features will remain unchanged. Financial products using the FTSE Bursa Malaysia Large 30 Index or KLCI, such as the FBM30etf, Kuala Lumpur Composite Index Futures (FKLI) and the Kuala Lumpur Composite Index Options (OKLI) will adopt the FTSE Bursa Malaysia KLCI as its underlying index with effect from 6 July 2009.

As part of the FTSE Bursa Malaysia Index Series, the FTSE Bursa Malaysia KLCI is reviewed every June and December by an independent index committee for compliance to the Ground Rules of FTSE Bursa Malaysia index series.

For more information on FTSE Bursa Malaysia KLCI, please visit http://www.bursamalaysia.com/website/bm/market_information/fbm_klci.html or www.ftse.com/bursamalaysia.

(Ranked by 12 -months Return)
Source: Islamic Finance Asia June/July 2009
Publisher IFA Media Sdn Bhd

Original article can be accessed at The Edge Daily Web Site

Public Bank Bhd’s unit, Public Mutual has won AsianInvestor’s “Best Malaysia Onshore Fund House” award for the second consecutive year.

Public Mutual chairman Tan Sri Teh Hong Piow received the award from AsianInvestor associate publisher Rebekka Kristin at Public Mutual’s annual awards on May 17.

AsianInvestor is a Hong Kong publication focusing on the region’s asset management industry. It introduced the AsianInvestor - Investment Performance Awards in 2001 to celebrate the excellence in investment performance by the fund managers in Asia Pacific.

Kristin said Public Mutual was named “Best Malaysia Onshore Fund House” due to its resilient performance in a year of financial uncertainty.

“This award acknowledges the outstanding achievements of everyone at Public Mutual who has worked so hard for, in what is truly a challenging industry at the moment,” she said.

Teh said this international recognition also marked the company’s 135th industry award since 1999.

“This esteemed award demonstrates Public Mutual's commitment in continuously delivering top value as well as meeting the diverse needs of our unitholders,” he said.