Apart from GPS leaving BN, nothing else has changed at the moment, says analyst

By NUR HAZIQAH A MALEK / Pic By TMR

The move by component parties of Barisan Nasional (BN) to break off and form Gabungan Parti Sarawak (GPS) had no major impact on Sarawak-based counters as the possibility of the development was priced-in after the outcome of the 14th General Election (GE14) last month.

On Tuesday, Parti Pesaka Bumiputera Bersatu, Sarawak United People’s Party, Parti Rakyat Sarawak and Progressive Democratic Party formed a new coalition called GPS which holds 19 parliamentary seats and 72 seats (out of 82 seats) in the state assembly.

“Apart from GPS leaving BN, nothing else has changed at the moment,” AllianceDBS Research Sdn Bhd analyst Abdul Azim Muhthar told The Malaysian Reserve yesterday.

Timber and oil palm grower Ta Ann Holdings Bhd was little changed, down by two sen to RM2.74 in yesterday’s trade, while Cahya Mata Sarawak Bhd (CMS) lost two sen to RM2.78.

CMS has been upgraded to a ‘Buy’ by AllianceDBS after the sharp fall in its share price post-GE14.

Trading at RM4 levels prior to the election, CMS fell sharply after Pakatan Harapan gained control of Putrajaya to hit a low of RM1.74 before buying support saw it rising to current levels.

“We suspect the selling pressure is mainly due to market sentiments regarding political uncertainties in Sarawak, given that CMS is perceived as a politically-linked stock and the possibility of existing projects to be put under review,” it said.

AllianceDBS added that the stock’s sentiment will return to normal once the dust settles.

“As the state government has extended the state road concession contract for another six months, we expect CMS to secure a long-term renewal for the concession,” it said.

Meanwhile, other Sarawak- based counters like Dayang Enterprise Holdings Bhd and Sarawak Cable Bhd gained by 0.5 sen to 72.5 sen and 0.5 sen to 43.5 sen respectively, at the close yesterday.

The share prices of Naim Holdings Bhd, Hock Seng Lee Bhd, WTK Holdings Bhd, Bintulu Port Holdings Bhd and Sarawak Plantation Bhd were unchanged.