‘Opportunity behind narrowness.’
The announcement of the end of the ceiling price of chicken and chicken eggs as well as cooking oil subsidies have made the shares of domestic poultry companies soar.
It is believed that investors are taking advantage of the announcement of the Ministry of Domestic Trade and Consumer Affairs that it will end price controls on chicken starting July 1.
In addition, Prime Minister Datuk Seri Ismail Sabri also stated the elimination of subsidies for poultry farmers.
During the closing session of Bursa yesterday, LTKM shares jumped 6 sen (5.22%) at RM1.21, Teo Seng Capital Bhd gained 4 sen (5.19%) at 81 sen while CCK Consolidated Holdings Bhd jumped 3 sen (5.36%) at 59 sen.
Also, shares of Leong Hup International Bhd drove 2 sen (3.88%) at 53.5 sen, TPC Plus Bhd added 2 sen (10%) at 22 sen and Sinmah Capital Bhd expanded 2 sen (20%) at 12 sen.
Not to be outdone, Lay Hong Bhd rose 1.5 sen (5.56%) at 28.5 sen, Malayan Flour Mills Bhd added 1.5 sen (2.44%) at 63 sen while PWF Corporation Bhd grew 1.5 sen (2.8%) at 55 sen.
Meanwhile, for now until July 1, the ceiling price of standard chicken remains at RM8.90 per kilogram in Peninsular Malaysia.
On the other hand, the Minister of Domestic Trade and Consumer Affairs, Datuk Seri Alexander Nanta Linggi, hinted that the farmers' group planned to increase the price of chicken between RM10 to RM12 per kilogram.
Meanwhile, MIDF Research notes that the elimination of subsidies will cause food inflation to rise.
This is because the current situation with global commodity prices peaking will put pressure on food demand.
In addition, the MIDF also outlined food prices to increase by 3.9% year -on -year in the first 4 months of 2022 compared to the average increase in food inflation of 2.9% per annum from 2011 to 2019.
And, if the domestic food supply becomes more murky then headline inflation will reach a peak of 5.8%.
