19/06/2025

BIZ & FINANCE THURSDAY | JUNE 19, 2025

20

MARKETS/FROM THE BROKERS

SUNBIZ presents extracts of a selection of commentaries and research reports received from stockbrokers on counters that could be of interest to investors.

DISCLAIMER: The information is extracted from stockbrokers’ commentaries and research reports and do not represent the views or opinions of Sun Media Corporation Sdn Bhd. It is not a solicitation, recommendation or an offer to buy or sell the equities featured. Sun Media Corporation shall not be liable or responsible for any consequences resulting from usage of the information.

[ Compiled by SunBiz Team

Hyundai Motor Malaysia debut marks direct entry to market PETALING JAYA: Hyundai Motor Company has established Hyundai Motor Malaysia (HMY), a newly formed local entity following the brand’s direct entry into the market. This move represents Hyundai’s evolution from a distributor-led model under Sime Motors to a principal-led operational approach. This transition reinforces Malaysia’s strategic importance to the brand’s future. This transition will see Hyundai taking the driver’s seat – assuming full responsibility for brand, marketing, sales, and customer experience – with a dedicated local team empowered to make faster, market-relevant decisions and deliver a more connected, customer-first approach. Hyundai’s direct entry into the Malaysian market marks a significant milestone in its global expansion strategy — underscoring a long-term commitment to the nation’s economic and industrial growth. This commitment is realised through its strong emphasis on sustainable development and a growing local presence. The company is actively expanding its dedicated Malaysian team, laying the foundation for a robust nationwide dealer network and will be launching a series of on-ground initiatives designed to embed the Hyundai brand more deeply into the local automotive landscape. With a growing workforce projected to reach 100 employees by year-end, Hyundai has firmly planted its roots by establishing its Malaysian headquarters in Kuala Lumpur. “With the establishment of Hyundai Motor Malaysia, we are bringing the strength and agility of a global brand closer to home. This isn’t just a new chapter – it’s a long-term commitment to Malaysia as a strategic hub in Asean,” said Hyundai Motor Malaysia president Eric Lee.

Ringgit falls against dollar ahead of Fed rate decision

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

THE ringgit ended lower against the greenback yesterday ahead of a decision on US interest rates and as the war between Israel and Iran continued to escalate. At 6pm, the local note stood at 4.2500/2550 versus the greenback compared to Tuesday’s close of 4.2390/2475. Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the key indicator to watch is the “dot plot” of the US Federal Reserve (Fed) funds rate, which essentially reflects the near-term outlook for US monetary policy. The Fed dot plot is a chart used by the US Federal Open Market Committee (FOMC) to show the individual interest rate forecasts of its members. “It appears that the Fed may not be keen to ease monetary policy, as the risk of higher inflation remains fairly evident with the ongoing conflict in the Middle East. Markets are bracing for the outcome of the FOMC meeting tonight. Meanwhile, the US Dollar Index (DXY) fell 0.3% to 98.526 points despite the heightened geopolitical uncertainty,” he told Bernama. At the close, the ringgit traded mostly higher against a basket of major currencies. It rose against the British pound to 5.7218/7285 from 5.7413/7528, and gained vis-à-vis the euro to 4.8888/8945 from 4.8986/9084, but it depreciated versus the Japanese yen to 2.9322/9359 from 2.9271/9332 at Tuesday’s close. The ringgit was mostly lower against its Asean peers. It dipped versus the Indonesian rupiah to 260.5/260.9 from 260.2/260.8, eased against the Singapore dollar to 3.3074/3115 from 3.3068/3137, and was down vis-à-vis the Thai baht to 13.0240/0449 from 13.0114/0443 previously.

1 US Dollar

4.3130 2.8130 3.3520 3.1500 4.9630 2.6080 3.3520 5.8000 5.3160

4.1800 2.7000 3.2550 3.0650 4.8030 2.5120 3.2550 5.6170 5.0900 3.3510 57.8500 62.7800 52.7400 4.7700 0.0248 2.8790 41.0000 1.4500 7.2600 113.5000 110.2800 22.4400 1.3500 42.4200 12.2400 112.6000 N/A

4.1700 2.6840 3.2470 3.0530 4.7830 2.4960 3.2470 5.5970 5.0750 3.1510 57.8500 62.5800 52.5400 4.5700 0.0198 2.8690 40.8000 1.2500 7.0600 113.3000 110.0800 22.2400 1.1500 42.2200 11.8400 112.4000 N/A

1 Australian Dollar 1 Brunei Dollar 1 Canadian Dollar 1 New Zealand Dollar 1 Singapore Dollar 1 Sterling Pound 1 Swiss Franc 100 UAE Dirham 100 Bangladesh Taka 100 Chinese Renminbi 100 Danish Krone 100 Hongkong Dollar 100 Indian Rupee 100 Indonesian Rupiah 100 Japanese Yen 100 New Taiwan Dollar 100 Norwegian Krone 100 Pakistan Rupee 100 Philippine Peso 1 Euro

118.7400 3.5970 60.3900 68.2100 55.4900 5.0800 0.0274 2.9730 15.7000 44.5600 1.5500 7.7000 119.5600 116.1700 24.8400 1.4700 46.5700 13.8100

100 Qatar Riyal 100 Saudi Riyal

100 South Africa Rand 100 Sri Lanka Rupee 100 Swedish Krona

100 Thai Baht

Source: Malayan Banking Bhd/Bernama

Eco World Development Group Bhd Buy. Target price: RM2.21

Auto & Autoparts Neutral

Westports Holdings Bhd Buy. Target price: RM5.84

June 18, 2025: RM5.43

June 18, 2025: RM1.89

Source: Maybank Investment Bank

Source: Maybank Investment Bank

THE formalisation of Port Klang’s new tariffs were officially gazetted by the MoT on June 13. It encompasses charges related to terminal handling, shifting, restow, storage, and heavy lift or uncontainerised cargo. As previously announced, the revised tariffs is to be implemented in three phases: Phase 1 entails an average increase of 15%, effective July 15; Phase 2 will see a further 10% hike effective Jan 1, 2026; and Phase 3 will introduce a final 5% increase effective Jan 1, 2027. This will result in a cumulative hike of 30% over 1.5 years. A steep increase in storage charges will also take effect from June 15. This comes at a critical time, with yard utilisation >95% as of mid-June (vs. ~80% in Q1’25), amid congestion driven by geopolitical tensions and supply chain disruptions. The higher charges could more effectively reflect land use costs and discourage exporters from using the port as a storage ground for idle containers. Besides improving turnaround, the increased fees should support revenue and help offset rising costs from yard inefficiencies. That said, our revised forecasts have yet to factor in any uplift from storage charges, which could provide further upside. However, we maintain our container growth forecast of 2% for FY25–27, underpinned by steady intra-Asia trade. Key risks include a weaker global trade outlook, prolonged geopolitical tensions affecting transshipment flows, and persistent yard congestion. Delayed tariff pass-through, particularly for transshipment under fixed contracts, may cap near-term upside, while capex overruns/CT10 delays could weigh on LT growth. BUY with RM5.84 TP. – Maybank Investment Bank, June 18

Source: Company data, RHB

THE SPA for the second land sale (138 acres, RM694 million) to Microsoft became unconditional on June 10 (the first land sale became unconditional in early Jan 2025). This should ease investor concerns over the potential cancellation of data centre (DC)-related land sales in Malaysia, following announcements by key DC operators to halt expansion plans due to regulatory restrictions in the US and prevailing market conditions. We understand that the remaining two land deals i.e. with Princeton Digital Group (57 acres, RM224 million) and Pearl Computing (58 acres, RM266 million) are expected to become unconditional by year-end. The revised 6% SST is expected to weigh on ECW’s operating margins due to higher construction costs for sold commercial and industrial properties. As of Feb 2025, 43% of ECW’s RM5 billion unbilled sales are from these segments, including Se.Duduk D’Kajang (on commercial title). The impact on other duduk (affordable apartment) projects is harder to assess due to limited disclosure. In our view, the SST will likely affect duduk products more than industrial ones, given their thinner margins and more price-sensitive buyers. Additionally, most of ECW’s business park infrastructure is nearing completion/completed, except for Quantum Edge Business Park. That said, residential units on commercial land may be exempt from SST, pending further clarification. If so, the SST impact to ECW could be muted. BUY with RM2.21 TP. – Maybank Investment Bank, June 18

AUTO sector players’ performance largely missed expectations as SIME and Tan Chong Motor (TCM) tracked below our forecasts, while MBM Resources (MBMR) and Bermaz Auto (BAUTO) met expectations. SIME’s miss was due to weaker contributions from the industrial division and UMW’s machinery and equipment sub segment, coupled with wider losses from its auto business in China. That said, its RM4.8 billion industrial orderbook (+12.6% YoY) remains robust, while the effect of the parts price reduction should recede with declining inventory costs. Automotive sales volumes may slow, but solid contributions from mass-market brands, i.e. Perodua and Toyota, should cushion the impact. Despite challenges in China, SIME continues to benefit from strong BMW support. Meanwhile, TCM remained in the red, amidst weak sales volumes and the lack of a clear turnaround plan. MBMR’s Q1’25 core earnings declined by 11% YoY, in line with lower Perodua contributions. BAUTO’s FY25 earnings plunged by 56% YoY, in line with our projection. RON95 subsidy rationalisation is coming. Prime Minister Datuk Seri Anwar Ibrahim has reaffirmed the government’s commitment to removing the blanket subsidy as planned. While details remain limited, earlier indications may point to a rollout in 2H’25. Nonetheless, we believe the policy will raise vehicle ownership costs. This could accelerate EV adoption or lead some consumers to downtrade, especially given the limited affordable EV options. – RHB Research, June 18