01/12/2025

BIZ & FINANCE MONDAY | DEC 1, 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

Malaysia bond yields expected to hold steady

Ringgit likely to stay within RM4.12-RM4.14 range THE ringgit is expected to hold steady within RM4.12 to RM4.14 this week as traders and investors remain cautious ahead of the US Federal Reserve’s Federal Open Market Committee (FOMC) meeting in December. Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the Fed’s interest rate decision, with the probability of a 25-basis-point cut exceeding 80%, continues to be a key factor influencing the local currency. “Key US data to watch include the Institute for Supply Management index, Personal Consumption Expenditures inflation, and the University of Michigan Consumer Sentiment Index,” he told Bernama. The local note rose on Monday, Tuesday, and Thursday, but eased on Wednesday, ending the week firmer amid rising expectations of a US interest rate cut in December. Meanwhile, Kenanga Investment Bank Bhd said the ringgit strengthened within a narrow RM4.13–RM4.14 range against the greenback as the US Dollar Index slipped below the 100 level. Mohd Afzanizam said Bank Muamalat also expects the US dollar–ringgit pair to trade stronger in the RM4.12–RM4.13 band next week. “With little to challenge the prevailing ‘Fed-cut’ narrative, investors may continue reinforcing December-cut bets, leaving US dollar risks skewed to the downside,”Kenanga said in a note. On a weekly basis, the ringgit strengthened against the greenback, closing higher at 4.1300/1350 compared with 4.1460/1495 last week. It improved against the yen at 2.6420/6456 from 2.6453/6479 and gained versus the euro to 4.7768/7825 from 4.7779/7819.

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

KUALA LUMPUR: Malaysian Government Securities (MGS) and Government Investment Issues (GII) yields are expected to stay broadly stable this week, with the PMI release acting as the key catalyst. Kenanga Investment Bank Bhd, in a report, said persistent expectations of a December Fed cut should continue to ease pressure on domestic yields. “We are monitoring the scheduled December reopening of the 10-year MGS, which may be cancelled. If this happens, a tighter supply should offer marginal support to MGS. “Geopolitical risks around the China–Taiwan and Russia-Ukraine conflicts remain key swing factors. Ongoing flood risks could disrupt agriculture and broader economic activity.” Last week, the MGS and GII yields moved in a narrow, mixed range of -3.0 to 2.5 basis points (bps). The 10-year MGS rose 2.5 bps to 3.451%, while the 10-year GII slipped 0.7 bps to 3.514%. Kenanga said the MGS yields drifted higher as lingering China–Taiwan tensions kept sentiment cautious, and markets continued to reprice the odds of a December Fed cut. “Domestic factors added a mild drag, as monsoon flooding in parts of Malaysia and the region raised concerns over near-term disruptions to economic activity. “Still, the upward move was contained, supported by resilient domestic fundamentals. Inflation remains stable, and prospects for stronger bilateral ties, particularly with India, Botswana, and South Africa, continue to support confidence. “Solid demand at the latest MGII auction, with a bid-to-cover (BTC) ratio of 2.34x, also helped limit the rise in yields,“ Kenanga said.

1 US Dollar

4.2000 2.7540 3.2330 2.9860 4.8640 2.4090 3.2330 5.5540 5.2410 3.5060 59.5800 66.7600 54.4300 4.7900 0.0263 2.7030 42.3200 1.5500 7.2400 116.2100 112.8900 25.3300 1.4300 45.6200 13.5900 115.4100 N/A

4.0520 2.6420 3.1300 2.9010 4.7040 2.3190 3.1300 5.3740 5.0140 3.2500 57.0200 61.4000 51.6900 4.4500 0.0233 2.5770 38.9000 1.3700 6.8100 110.3200 107.1700 22.8700 1.2500 41.5200 12.0400 109.3600 N/A

4.0420 2.6260 3.1220 2.8890 4.6840 2.3030 3.1220 5.3540 4.9990

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

109.1600 3.0500 61.2000 51.4900 4.2500 0.0183 2.5670 38.7000 1.1700 6.6100 110.1200 106.9700 22.6700 1.0500 41.3200 11.6400 N/A 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

UEM Sunrise Bhd Neutral. Target price: RM0.60

Sime Darby Bhd Neutral. Target price: RM2.05

QL Resources Bhd Neutral. Target price: RM4.50

Nov 28, 2025: RM0.595

Nov 28, 2025: RM4.05

Nov 28, 2025: RM1.95

Source: PublicInvest Research

Source: PublicInvest Research

Source: PublicInvest Research

UEM Sunrise (UEMS) reported 3QFY25 net profit of RM18.9m (- 20.3% YoY, -15.7% QoQ), which came in within our estimates but below the consensus. YTD, the group’s 9MY25 of RM64.2m (+28.1% YoY) constituted about 76% and 64% of our and consensus full year estimates, respectively. Separately, the group has surpassed its FY25 pre-sales of RM1.05bn, after securing RM1.08bn in 9MFY25. Unbilled sales now stood at about RM2.1bn, which are expected to be recognised over the next 36 months. All told, no change to our earnings estimates. 9MFY25 revenue rose 60% YoY to RM1.3bn, driven by stronger property development revenue of RM931m, mainly supported by continued progress across key projects in the Central and Southern regions. In 3QFY25, the group recorded RM417.8m, rising 13% sequentially with property development contributing 82% of total revenue. Ongoing projects like The MINH in Mont’Kiara, The Connaught One in Cheras, and Residensi ZIG in Kiara Bay in Central region as well as Aspira Hills, Aspira LakeHomes and DiReka Square in Southern region delivered strong sales. However, group net profit moderated to RM18.5m due to higher finance costs and income tax expenses but was partially cushioned by improved operating margins and joint venture contributions. Unbilled sales amounted to RM2.1bn are expected to be recognised over the next 36 months. To recap, the group announced its FY25F sales target of RM1bn, with RM2bn worth of projects to be launched in FY25. So far, it has launched about RM1.8bn in GDV in 9MFY25, or 88% of its RM2bn full-year target. We upgrade our call to Neutral but revised its TP to RM0.60 from RM0.70. – PublicInvest Research, Nov 28

SIME Darby Bhd’s 1QFY26 headline net profit plunged 55.3% YoY to RM355.0m, entirely due to the absence of a one-off land disposal gain. Stripping this out, core net profit showed greater resilience with a more modest decline of 5.4% YoY to RM335.0m. The results were within both our and consensus estimates, accounting for 24.4% and 27.4% of full-year forecasts, respectively. 1QFY26 revenue saw a marginal dip of 1.3% YoY to RM18bn. The decline was led by a 13.9% drop in the Industrial division to RM4.5bn, resulting from a shift in equipment delivery timings to the next quarter. This softness was partly offset by a 5.7% revenue increase in the Motor division to RM9.2bn, fuelled by strong electric vehicle sales in Singapore Meanwhile, UMW revenue held steady at RM4.4bn, on the back of robust performance from UMW Toyota and Perodua. 1QFY26 core net profit contracted 5.4% YoY to RM335m, pressured by sharp declines in the Industrial and Motor divisions. The Industrial was hit by delivery delays and foreign exchange headwinds, while the Motor division suffered from intense competition and weaker assembly production. The standout performer was UMW, which delivered a 22.0% PBIT growth, effectively offsetting some of the losses. This was largely due to resilient sales, margin improvement, cost optimisation initiatives and a favourable currency tailwind. Group’s outlook remains uncertain, with challenging business conditions anticipated to continue across its operating markets, most notably in China. A potential positive catalyst is China’s proposed pricing law reform, which, if enacted, could mitigate cut-throat competition, rationalise industry capacity, and bolster margins. We maintain our earnings forecasts, Neutral rating, and SOTP-based TP of RM2.05. – PublicInvest Research, Nov 28

QL Resources Bhd recorded a core PATAMI of RM116.2m in 2QFY26, down 9.4% YoY, mainly due to weaker performance across the Palm Oil and Clean Energy (POCE), Marine Product Manufacturing (MPM) and Convenience Store Chain (CVS) segments. 1HFY26 core PATAMI of RM216.8m was broadly in-line with expectations, accounting for 45% and 46% of ours and consensus estimates. However, we adjust our earnings forecast lower by 3-5% for FY26-28F, as we lower our sales assumption for MPM and CVS segments. We foresee QL’s outlook to remain subdued, given the challenging operating environment in the MPM and CVS segments. Nevertheless, we think that the recovery in egg prices in Indonesia and Vietnam, coupled with lower feed costs, should help to cushion the weaker performance. Depressed fishmeal selling price and sales volume lead to a 10.8% YoY decline in the MPM segment. Meanwhile, Integrated Livestock Farming (ILF) segment’s revenue decreased by 10.4% YoY, on lower feed raw material trading prices. POCE segment revenue declined by 9.8% YoY, mainly dragged by extremely low CPO sales. Meanwhile, CVS segment increased 5.1% YoY on a net addition of 55 stores, though overall performance was impacted by softer consumer sentiment and intensifying competition. 2QFY26 core PATAMI declined 9.4% YoY to RM116.2m, weighed down by margin compression in MPM segment following lower sales volume and ASPs. POCE segment PBT fell 47.9% YoY on lower solar project contribution. CVS segment PBT also decreased 44% YoY owing to weaker average store sales and higher operating expenses. On a positive note, ILF segment PBT rose 9.3% YoY, supported by stronger farming operations in Vietnam and better-than-expected margins from Malaysia’s layer operations. Downgrade to Neutral, with a revised TP of RM4.50. – PublicInvest Research, Nov 28