Tuesday, December 29, 2009


Due to technical difficulties yesterday we were not able to have a report for you today. Apologies for any inconvenience caused.

Monday, December 28, 2009



The bourse on Thursday had a relatively calm day with reasonable volumes changing hands for BSP. BSP saw a late rally, surging 6.66 percent to close at K0.80. While LGL and NBO ended the week flat at K8.00 and K18.00 respectively. IOC registered last trade at US$75.87.

In commodities, gold jumped 0.91 percent to close at US$1104 per ounce likewise oil closed stronger above the US$75.00 mark.

The market is expected to have calm sessions through the holiday period, with offers for CCP as low as K1.77 as bidders for HIG are queuing up at a high K0.80.

Last Thursday’s movers on the local bourse 24/12/09:
BSP: 6.66%

Thursday, December 24, 2009




Yesterday, the bourse closed active again with reasonable volumes changing hands for BSP and LGL. NGE dropped 10 toeas tracking a stronger US dollar pushing the commodity prices lower previously. While OSH finished slightly up at K14.00. IOC continued to surge on the back of signing of the LNG project with the State.

The market may finish relatively flat as per leads from overseas. As our kina this morning is buying 0.4423 and selling at 0.4004 aussie.

Yesterday’s movers on the local bourse 23/12/09:
CGA: -3.17%
NBO: 2.85%
NGE: -20.00%
OSH: 0.07%

Tuesday, December 22, 2009



The KSi fell 4.77 percent to end the day at 6271 yesterday, on the back of weaker performances from LGL and OSH closing at K8.00 and K12.10 respectively. Diversified Financial also finished slightly weaker at K1.78. IOC on the NYSE ended the day at US$71.70.

Gold lost its appeal an alternative investment after the green back continued to surge against most of the major currencies. Likewise oil tracking the stronger dollar to close at US$72.47 per barrel.

The opening phase of the market this morning had CPL open the day at K2.45. Our Kina this morning is buying 0.4421 while selling at 0.4002.

In company news, IOC reported the scheduled signing between the State and IOC to initiate another LNG project.

Monday’s movers on the local bourse 21/12/09:
CCP: -0.55
LGL: -0.12%
OSH: -13.44%

Monday, December 21, 2009



The bourse finished relatively active last Friday with reasonable volumes being traded. BSP and HIG were the major movers with 1.35 and 12.50 percent jumps. While OSH finished marginally weak at K13.98, in overseas saw IOC closed at US$66.10 with a day’s high of US$71.22.

The markets were generally stronger on the back of positive signals from two major tech companies that business was improving, lifting hopes about business spending. On which the US dollar pared its gains.

The pre open phase of the market this morning has shares available for BSP at K0.75 while NBO sellers are lined up at a low K18.00. Kina this morning is buying 0.4371 and selling 0.3957 aussie.

Last Friday’s movers on the local bourse 18/12/09:
BSP: 1.35%
BSPHA: 0.56%
HIG: 12.50%
NBO: 0.57%
OSH: -0.07%

Friday, December 18, 2009



The local bourse closed relatively active with BSP registering trades at K0.74 with a day’s high of K0.75. HIG on the other hand dropped 11 percent to close at K0.80, while CPL finished steady at K2.45 on light volumes. KSi edged higher by 5 percent to conclude the day at 6570 points.

No other company news, but the market looks to gain on trading momentum as the festive season nears. The market may have a lower start today with negative leads from overseas. Kina this morning is buying 0.4386 and selling 0.3970 aussie.

Yesterday’s movers on the local bourse 17/12/09:
HIG: -11.11%
OSH: 0.28%

Tuesday, December 15, 2009

BSP purchase of Commonwealth Bank's Fiji Operation

BSP yesterday announced that they have received all necessary regulatory consents to proceed to completion of the purchase of Commonwealth Bank's Fiji operations.



Generally the international markets closed higher on the back of Dubai’s bailout by Abu Dhabi, this also prompted the commodities to end on higher note, although on light volumes. The local bourse yesterday finished flat with BSP, CCP and HIG concluding the day steady, while OSH and NBO fell 5 and 6 percent respectively.

The pre-open phase of the market has sellers for HIG shares lined up at K0.90 and OSH shares are available as low as K14.00. Our kina this morning opened lower buying aussie at 0.4275 while selling at 0.3870.

Yesterday’s movers on the local bourse 14/12/09:
NBO: -5.29%
OSH: -6.73%

Monday, December 14, 2009

Market Commentaries

Bank South Pacific
BSP continues to increase its exposure in the South Pacific region as it acquires Colonial National Bank in Fiji. The stock has been trading between 70t and 73t for some time but it is finding a new level around 75t. Trading has been quite active and the stock is rallying from its lows. A number of reports place the stock price at K1.00 in one year. We believe BSP will return around 30% over the next twelve months. Our price target is K0.95. Our recommendation is BUY.

Credit Corporation
Credit Corporation shares have traded between K1.75 and K1.80 in November. Trading was irregular apart from a 9,000,000 crossing by BSP Capital at K1.75. We have seen some additional buying interest, mostly due to a recent Nasfund report that valued CCP at around K2.40. As you know CCP is held tightly and it is hard to flush out any selling. We believe the stock will move in a range between K1.80 to k2.20 over the next 6 months. Our recommendation is BUY.

City Pharmacy Limited (CPL)
CPL opened new pharmacy outlets in Alotau and Kokopo and is supplying pharmacy products to four locations with properties leased by Post PNG. The company has other exciting projects coming up including a new pharmacy outlet at Vision City and a new supermarket at Badili in Port Moresby. Meanwhile the Kavieng pharmacy outlet will increase its floor space by three. Its hardware business adopted an exciting Kit Home concept from Europe to address the housing needs in PNG. The stock was trading fairly at K2.50 for all month round with light volumes changing hands. But we view the stock price is lagging behind its profit growth. The target price in one year is K3.20. It is with this in mind that we continue to recommend as a STRONG BUY.

Airlines PNG
Bid and offer remain fairly active, however no trading has occurred during the month. The market is bid 63t and offered 64t. We are hearing various views on APNG with the majority on the negative side. It has recently leased a Dash 8 aircraft to the Solomon Islands that leads us to believe aircraft are underutilized. Many employees have departed over the past 12 months which may lead to lower costs. Conversely, concerns may arise through maintenance and management issues. We are negative on the stock and the heavy selling pressure multiplied by a falling share price will do APNG no favors. Our recommendation is SELL.

New Britain Palm Oil
New Britain Palm Oil has released encouraging third quarter operating results and trading updates. Productions of crude palm and kernel oil increased by 14% to 273,354 tonnes compared to the same period last year. The stock has risen to K18.00 with solid buying support both locally and in the UK market. Prices in the first 9 months of the year for palm oil have ranged between US$530 to US$825 per tonne. NBPOL has averaged US$717 per tonne in the first three quarters for crude palm oil. The majority of the fourth quarter’s production of crude palm oil has been sold at an average price of US$694. The UK palm oil refinery will commence operations around April 2010. It will further consolidate NBPOL as a leader in the sector. We are happy to recommend the stock as a BUY.

Lihir Gold Limited
LGL released its third quarter production report at the end of October. It had quarterly gold production of 233,000 oz. Year to date production is 845,000 ozs and the company is on track to achieve record full year production of 1-1.2million ozs. Reserves increased by 7.5million ozs to 28.8million ozs. A maiden interim dividend of US1.5 cents per share was announced. The gold price rose 13.2% over the month to US$1177 and continues to rise. Quarterly production exceeded guidance for the quarter. The MOPU and Interim Power Station project is on schedule and on budget. The project will cost $315million and $142million has been outlaid so far. We have been advising investors to reduce 25% of their gold exposures and to book some profits. LGL is slightly different in that it is both increasing production and lowering costs substantially. We are going to stay the course for another three months before we take a further look at Lihir Gold. Our recommendation is HOLD.

Oil Search Limited
After the successful completion of the A$895million Institutional Placement, we believe OSH is well placed for its future cash requirements. PNG LNG project entered into a Heads of Agreement with Unipec Asia Co Ltd, a subsidiary of China Petroleum and Chemical Cooperation (Sinopec). It is for a long term supply of 2 million tonnes of liquefied natural gas (LNG). Oil Search as a major partner will directly benefit from the supply agreement. During the month the stock traded between A$5.52 and A$6.12 on the ASX and between K13.00 and K15.50 on POMSoX before closing at A$5.70 on the ASX and K. With the Benefits Sharing Agreement about to be completed and the Final Investments Decision (FID) scheduled for 8 December, the stock is expected to rally. OSH continues to represent a long term investment in to the PNG oil and gas industry. It is with this in mind that we maintain our recommendation as a BUY.

Highlands Pacific Limited
Progress on Highlands Pacific Ltd’s (HIG) interests in Ramu Nickel, Frieda River and the Nong River projects have shown steady progress over the month. The Ramu Nickel project is fully funded and commissioning of various ancillary parts of the plant has already commenced. There is likely to be staged commissioning which will continue throughout the early part of 2010. Pre-feasibility studies on the Frieda River project continue to show impressive results with an upgraded resource model expected in December 2009. The pre-feasibility study is expected to be completed in mid 2010. HIG has renewed its Tifalmin exploration licence with funding of US$3.0m while HIG is in negotiation with Xstrata on a possible joint venture agreement on the Nong River exploration licence. Both licence areas are located 20km from the Ok Tedi Mine site. With expected resource upgrades in Frieda and the efficient progress in Ramu, we expect HIG to increase gradually with a rally in the second half of 2010. In November the stock closed at 36 cents on the ASX and 96t on the POMSOX after reaching a high of 45 cents on the ASX. Our recommendation is a BUY.

Westpac Banking Group
The Bank has released encouraging news on its second half yearly performances portraying 2% sequential rise in profit at the back of increased business loans and consumer’s credit as well as increases in bank fees and charges. Although the lending margin has been shrinking, housing loans are not suffering greatly. The global financial crisis will soon be history as banking stocks are performing well above the required level. The stock was trading on ASX between $23.03 and $26.78 and closed the month at A$24.14.
National Australia Bank
Trading was active on the market as substantial volumes changed hands. In November the stock traded between $30.39 and $26.81 and closed at $28.26 on ASX. The outlook is promising as business confidence edges higher led by construction activities. Long term lending rates set to be unchanged and this provides a unique opportunity for the bank to increase its lending margin. We anticipate the stock to perform better in the next 30 days.

Australia New Zealand Bank
The ANZ Bank has released its financial report for the year ending 2009 with profits tumbling 11% to $2,943 million, although and far better performance than the previous corresponding period. The shareholders who participated in a Share Purchase Plan initially issued at $14.40 per share in July to the retail shareholders have made 54% gains on investments in five months after ANZ’s share price closed in November at $22.15. ANZ has invested heavily into income generating assets in the last year and we expect profits to increase within the next 12 to 18 months. Our recommendation is a BUY.

Commonwealth Bank of Australia
Trading was active with substantial volumes changing hands during the month. Investors maintained the market price between $50 and $55 on ASX with the price closing at $52.80 at month end. The bank’s outlook is promising due to increased lending through offshore issuance and favorable domestic interest rates which are up by 25 basis points to 3.75%. We expect the stock to continue trading within this price range for remainder of the year. Our recommendation is HOLD.

Marengo Mining Ltd
The stock was on a down-turn trading between 18 cents and 16 cents on ASX and 50t and 56t on POMSoX as too many resources stocks has been grossly undersold. Marengo Gold announced the raising of A$421.7 million to fund the Yandera Copper Gold project. The details of the Yandera Copper Gold project are expected to be announced in December. We have a SPECULATIVE BUY recommendation on Marengo.

Ord River Resources Ltd
Trading was fairly active with a strong start early in the month at 7.1 cents, but the price tumbled toward the end to close at 5.2 cents on ASX. The price is anticipated to recede as Copper Flat Exploration in Western Australia has been delayed due to wet weather.

Allied Gold Ltd
Allied Gold (ALD) acquired Australian Solomon Gold (ASG) in November and has taken control of all its operations. Fears of lower earnings per share may have pushed the price lower to close at 39.5 cents as the company issued new shares to raise capital to complete the takeover. The stock opened high at 41 cents and steadied lower to 35 cents after reaching high to close at 48 cents. Probability of expansion and growth is high with number of projects ASG is embarking on including ALD own record gold production at Semberi. We recommend investors HOLD their shares.

New Guinea Energy Ltd
New Guinea Energy (NGE) has done a private placement with sophisticated investors to raise A$18.5 million to fund its exploration activities in the Western forelands of PNG. The stock performed with mixed results opening at 19 cents and increasing to 22.5 cents before closing lower at 15.5 cents. NGE has farmed out its PPL 267 and 268 to Talisman Energy Limited for US$55 million. The exploration areas are estimated to contain approximately 3 billion mmboe. We view this stock as a tool for growth and urge investors to be there early. Our recommendation is a BUY.

Call us on (+675) 321 4333 and speak to one of our client advisors



Last week Friday saw the local market closed active with almost all the trading stocks registering trades; BSP and OSH were the highlights finishing stronger at K0.74 and K15.00 respectively. While on the NYSE IOC closed at US$70.33 reaching a high of US$70.55. Gold was down by 0.59 percent to US$1120 per ounce likewise oil finishing just under US$70.00 per barrel.

This morning should have the market open flat with mixed leads from overseas. BSP shares are available at K0.74 while buyers for HIG are bidding as high as K0.80.

Friday’s movers on the bourse 11/12/09:
BSP: 4.22%
OSH: 7.14%

Friday, December 11, 2009



Thursday had the KSi rose slightly, up by 0.99 pts to end at 6,552. BSP and HIG were the movers yesterday with BSP finishing the day weaker at K0.71 while HIG ended on the upside gaining 8.88 percent to close at K0.98. LGL on the ASX concluded trading at A$3.19 riding on a falling gold price.

In commodities, had gold climb 0.49 percent US$1126 per ounce as spot crude oil ended lower registering a close at US$70.55 per barrel.

This morning, the market is expected to open flat with shares for BSP available at K0.71 and CPL offers are at a low K2.45.

Yesterday’s movers on the local market 10/12/09:
BSP: -1.38%
HIG: 8.88%

Tuesday, December 8, 2009



Yesterday saw the local market closed quiet with light volumes changing hands for BSP and HIG ending the day at K0.74 and K0.90 respectively. While in London had NBPO advanced 6 percent to finish stronger to GBP3.95 which is equivalent to K18.23 as IOC edged higher concluding the day at US$62.30 on the NYSE.

On the commodities front, saw oil and gold closed weaker with Gold price settling at US$1164.00 per ounce as crude slid 2 percent.

This morning in the pre open phase has bids for LGL as high as K8.00 while sellers are queuing up at K8.30. We should expect the market to open lower riding on negative leads from the international markets.

All of the stocks closed flat yesterday.

Monday, December 7, 2009

Marengo Minning European Investor Presentation

Marengo Mining released an Investor presentaion outlining the overall operations and an update on its Yandera prospects in Madang Province, Papua New Guinea.

MSTG Equity & Debt Placement Correction

Metal Storm previously announced today that the Company has negotiated an immediate small equity placement to provide carry forward funding. It was stated in that announcement that documentation for this is expected to be completed today.

The Company wishes to correct this. The funding and documentation in respect of this is expected to commence today. The Company will advise the market further when this facility is completed or when there is further material progress in this matter.

As stated in the previous announcement the Company now expects to receive the First Tranche funding in the AFHL equity and debt placement by 7pm (Brisbane) Tuesday, 8December 2009.

Source: Metal Storm Limited

Friday, December 4, 2009



The KSi closed slightly higher yesterday, advancing 0.16 percent to 6728 points. Trading was active with most of the major trading stocks witnessing trades. The movers of the day included BSP and NBO finishing respectively at K0.74 and K17.00. IOC closed weaker at US$61.51 on the NYSE.

The market may open flat due to mixed leads from the international markets, with bids for BSP at a high K0.72 in the pre open phase and sellers for NGP are lined up as low as K1.71. The kina is up this morning and is buying 0.4284 and selling 0.3887 aussie.

Yesterday’s movers on the local bourse 02/12/09:
BSP: -1.33%
NBO: 6.11%

Wednesday, December 2, 2009



Tuesday had the market close relatively active with reasonable volumes changing hands, with BSP and NBO ending the day in positive territory. On the downside was HIG finishing weaker at K0.90; while the others closed steady. Resulting in the KSi closing marginally in the black gaining 0.29 percent (6721).

In commodities, saw the precious metal climbing 18 dollars to register a close at US$1200 per ounce, likewise did Crude advancing 1.41 percent to finish at US$78.16 per barrel. This all was supported by a weakened US dollar.

This morning may also see a reasonably active day of trading with positive leads from overseas. The sellers for CCP in pre-open phase of the market today are queued at K1.80, as bids for OSH are lined up as high as K14.99. In currency news, our kina this morning is buying aussie at 0.4288 while selling 0.3882.

Monday’s movers on the local bourse 01/12/09:
BSP: 1.38%
HIG: -5.26%
NBO: 6.25%

Tuesday, December 1, 2009



The local bourse closed lower yesterday with light volumes changing hands for BSP, HIG, MGO, NBO and OSH. BSP share price plummeted by 4 percent after strong finish on the previous trade. HIG also plummeted meanwhile OSH had a massive gain of 7.14 percent. Other common stocks remain unchanged as of last trade.

The market this morning may open high at the back of good news coming out of debt strapped Dubai World after the UAE government announced that it will back Dubai to repay its debts. The US dollar is down by 3 cents.

The KSI closed higher, up by 144.60 points to close at 6,702.26. NGE shares are on bid on the local bourse at a low of K0.450. Our Kina this morning is buying at 0.4330and 0.3919 aussie.

Friday’s movers on the local bourse 1/12/09:
BSP: -4.00%
HIG: -1.04%
OSH: +7.14%
KSI: +2.12%