22/09/2025

BIZ & FINANCE MONDAY | SEPT 22, 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

M’sia trade growth path holds despite US tariff risks: Kenanga KUALA LUMPUR: Malaysia’s exports slowed in August, rising just 1.9% year-on-year compared with 6.5% in July, as higher US tariffs and softer demand for electrical and electronic (E&E) products weighed on performance. Kenanga Investment Bank Bhd said shipments to the US fell 16.7%, the steepest in 20 months, though stronger demand from China, up 10.4%, provided some support. By sector, manufacturing exports moderated to 1.7%, while mining remained weak. Agriculture bucked the trend, rebounding 4.5% on firmer palm oil exports, which rose 9.7% after recent declines. E&E exports, Malaysia’s largest export category at 42.2% of the total, eased to 10.1% growth. Commodities remained a drag, with steep falls in crude petroleum and petroleum products. Imports contracted sharply by 5.9%, the weakest since September 2023, driven by lower demand for intermediate and consumption goods. Capital goods imports slowed but stayed positive. The overall trade surplus widened to RM16.1 billion, above market expectations. Kenanga said despite near-term volatility, Malaysia’s trade outlook remains intact. Exports for the first eight months of 2025 grew 3.9%, outpacing the full-year forecast of 3.1%. Demand for E&E is expected to stay resilient, supported by global adoption of AI, 5G, automation, and electric vehicles. Kenanga further said risks remain from US trade policy uncertainty, uneven global growth, and geopolitical tensions, but stronger demand from key partners and supportive domestic policies may lift prospects. Malaysian Pacific Industries Bhd Buy. Target price: RM35

Ringgit to trade within tight range this week

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

THE ringgit is expected to continue trading within a tight range with an upward bias this week, as investors reassess the trading trend following the US Federal Reserve interest rate cut. SPI Asset Management managing director Stephen Innes said that this week is relatively light on US top-tier economic data, with the US Manufacturing Purchasing Managers’ Index readings being one of the real macro waypoints. Nevertheless, the release of the US second-quarter 2025 gross domestic product data will be closely watched for signs of economic momentum and its potential implications on the Fed’s policy path. “Market compass may also point towards Fed speakers. A string of officials will speak, and if their tone tilts more dovish than Fed chair Jerome Powell’s careful script, the dollar could easily moderate again and the ringgit strengthen again,” he told Bernama. In the meantime, Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid opined that emerging market currencies, including ringgit, could gain further traction if traders and investors sensed that the Fed could be behind the curve. “For now, it seems that they are on track in steering the monetary policy,” he noted, adding that the ringgit might stay above 4.20 per dollar in the immediate terms. On a weekly basis, the ringgit ended easier against the greenback, closing at 4.2040/2115 versus 4.1975/2080 previously. The ringgit depreciated vis-a-vis the Japanese yen to 2.8419/8471 from 2.8373/8446 in the previous week and weakened versus the euro to 4.9447/9536 from 4.9203/9326, but gained against the British pound to 5.6775/6876 from 5.6864/7006. It was slightly lower against the Singapore dollar to 3.2744/2805 from 3.2719/2803 at the end of last week.

1 US Dollar

4.2770 2.8370 3.3290 3.0920 5.0340 2.5200 3.3290 5.7870 5.4200 3.5800 60.4100 69.1400 55.4600 4.9200 0.0268 2.8920 44.3400 1.5300 7.5800 118.3700 115.0500 25.4900 1.4500 47.0500 13.9700 117.5500 N/A

4.1310 2.7230 3.2250 3.0060 4.8720 2.4270 3.2250 5.6050 5.1890 3.3330 57.8500 63.6200 52.6900 4.6200 0.0242 2.7880 40.7900 1.4300 7.1300 112.3700 109.2200 23.0200 1.3300 42.8500 12.3800 111.4500 N/A

4.1210 2.7070 3.2170 2.9940 4.8520 2.4110 3.2170 5.5850 5.1740

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

111.2500

3.1330

N/A

63.4200 52.4900 4.4200 0.0192 2.7780 40.5900 1.2300 6.9300 112.1700 109.0200 22.8200 1.1300 42.6500 11.9800 N/A

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

Sunway Bhd Buy. Target price: RM6.08

Eco World Development Group Bhd Buy. Target price: RM3

Sept 19, 2025: RM5.38

Sept 19, 2025: RM2.24

Sept 19, 2025: RM29.12

Source: Bloomberg, RHB Research

Source: Bloomberg, RHB Research

Source: Bloomberg, RHB Research

MALAYSIAN Pacific Industries is acquiring Infineon Technologies (Thailand) (IFTH) from Infineon Technologies (Infineon) for US$77.9m. While near-term neutral, it is medium-term positive as it expands MPI’s semiconductor backend manufacturing footprint, secures a strategic tie with Infineon, and strengthens regional diversification. Despite the terrific share price run in recent months, we still like the stock for a stronger FY26F performance, technology roadmap, and strong footholds in high-growth segments. Incorporated in 1984, IFTH is engaged in semiconductor assembly and testing with operations in Nonthaburi, Thailand. It produces a diverse range of products spanning memory, microcontroller, communication, mixed-signal & analogue, and system-on-chip technologies. With advanced memory test systems, IFTH’s plant boosts cost efficiency in testing semiconductors and memory chips. For FY24 (Sep), it reported net assets of THB3.55bn (c.RM470.7m) and net loss of THB57m (c.RM7.6m) due to FX effects vs an FY23 PAT of THB58m (c.RM7.7m). IFTH has more than 1,000 employees and its facilities sit on a 772k sq ft area. The US$77.9m base price for the 100% stake was agreed on a willing-buyer, willing-seller basis - subject to adjustments for net working capital, cash, and debt. The acquisition will be fully cash funded with no dilution to shareholders. At 0.7x P/BV (based on FY24 net assets), we view the valuation as undemanding. We view the deal as medium-term positive. It enables MPI to: i) Take over IFTH’s backend site in Thailand to diversify its own manufacturing footprint, ii) facilitate closer collaboration and potential long-term synergies through technology transfers and scale efficiencies, and iii) create customer stickiness, given that IFX Group is MPI’s existing customer. BUY, new RM35 TP from RM30.50. - RHB Research, Sept 19

WE are positive on Sunway’s acquisition of MCL Land from Hongkong Land Holdings, providing an immediate lift in Singapore’s unbilled sales to almost SG$1.8bn from SGD614m. MCL Land’s existing portfolio also suits Sunway’s profile with its other retail mall and land parcels in Wangsa Maju and Seremban. At 1x P/NAV, we think the acquisition is fair given the synergy that the deal can bring to Sunway, and three of the MCL Land’s projects in Singapore will be completed very soon by end 2025. The total cash consideration of up to SG$738.7m (or RM2.4bn) comprises five projects in Singapore with combined GDV of SG$2.96bn (by effective stake), Wangsa Walk Mall (at 99% occupancy and NPI yield of 6.4%) as well as land parcels in Wangsa Maju (>3m sqf GFA) and Forest Heights township in Seremban (4m sqf undeveloped land, 50% JV stake). Apart from strengthening its presence in Singapore, the Wangsa Walk Mall also provides a development opportunity due to unutilised plot ratio (4x for the project). Seremban is also a new area that Sunway recently ventured to for a transit-oriented development. Currently there are about 70-80 employees in MCL Land, and Sunway will absorb all of them. The acquisition does not require approval from Sunway’s shareholders, and will be completed in 4Q25. Sunway is certainly bullish on the Singapore property market over the long term. The acquisition is also timely, as the property market in Singapore has been going strong lately. Through the acquisition, Sunway is able to participate in more projects in Singapore at historical land costs, lowering execution risks compared to new land tenders. Moving forward, Sunway will continue to focus on the mid- to mid-high segment with the ASP of SG$2.2k-2.7k psf price range. Maintain BUY, with new RM6.08 TP. - RHB Research, Sept 19

ECO WORLD’S 3QFY25 results are in line with expectations. Its sales momentum remained strong as 10MFY25 new sales already hit MYR3.84bn, exceeding management’s full-year target of RM3.5bn. Demand for upcoming projects seems promising, and these should drive its FY26 property sales. Meanwhile, the construction of a data centre (DC) in Puncak Alam has already commenced, and should be on track for completion in 2HFY27. Revenue and earnings contracted QoQ, mainly due to the recognition of the sale of a 123-acre parcel of industrial land at Quantum Edge to Microsoft Payments (M) in the previous quarter. In addition, higher billings from the Eco Rise pillar also resulted in a slight decline in its development margin (as the margin for landed homes is more lucrative). A 2-sen third interim DPS was declared, bringing YTD DPS to 5 sen. Net gearing was at 0.53x (vs 0.55x in 2QFY25). 3QFY25 property sales amounted to RM855m vs MYR1.06bn in 2QFY25. Note: 10MFY25 property sales already hit RM3.84bn, surpassing its FY25 target of RM3.5bn. Projects in Iskandar Malaysia remain the key contributor with RM1.99bn in sales (52% of total), followed by projects in the Klang Valley (38%) and Penang (10%). Among all products, Eco Townships contributed RM1.3bn in sales (54%), followed by Eco Business Parks (EBP) and Quantum (32%) and Eco Hubs (15%). Interestingly, sales for SWNK Houze@BBCC (MYR174m sales for 9MFY25) also rose solidly, with recent buyers mainly hailing from Taiwan. The encouraging response was largely driven by the positive impact of ECW’s value creation initiatives (which include TUAH 1895 and Mitsui Outlet Park@LaLaport) as well as overseas roadshows. Maintain BUY and RM3 TP. - RHB Research, Sept 19