06/01/2026

BIZ & FINANCE TUESDAY | JAN 6, 2026

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

Contract flow in construction sector to remain steady: RHB IB KUALA LUMPU R : Malaysia’s construction sector is expected to see steady contract flow in 2026, the first year of the 13th Malaysia Plan (2026–2030), which allocates RM81 billion for development projects, slightly up from RM80 billion in 2025. RHB Investment Bank Bhd (RHB IB) said 2026 would be a year of execution, with contract deliveries translating into earnings for contractors that secured deals last year. Data from the Construction Industry Development Board showed the value of contracts awarded in 2025 fell to RM202.5 billion from RM231.6 billion in 2024, representing a 12.6% year-on-year decline. “This is not a major concern for the construction sector, as 2024 was a high base – the highest contract value awarded since the record RM241 billion seen in 2016,” the research house said. By contract type, the value of government contracts awarded declined 22.5% year-on-year in 2025, while private-sector contracts fell by a smaller 9% over the same period, it added. The value of infrastructure jobs awarded in 2025 decreased by 44% year-on-year to RM24 billion from RM44 billion, reflecting a 22% decline in government contract awards. Nonetheless, RHB IB expects several infrastructure awards to be rolled out this year, including the systems package and Segment 2 of the Penang Light Rail Transit, the Perak–Penang water transfer project, and the Johor Bahru Elevated Autonomous Rapid Transit. “The icing on the cake would be the debut of Mass Rapid Transit 3 awards in late 2026, although we expect this to more likely occur in 2027 following the land acquisition process,” it said. RHB IB maintained an overweight call on the sector, with Gamuda, Sunway Construction and Kerjaya Prospek among its top picks. – Bernama Malaysian economy Manufacturing PMI slightly above neutral

THE ringgit ended lower against the greenback yesterday, as markets shifted toward safe-haven currencies amid rising geopolitical uncertainty after the US attack on Venezuela over the weekend, an analyst said. At 6 pm, the local currency fell to 4.0695/0745 versus the US dollar from Friday’s close of 4.0515/0560. IPPFA Sdn Bhd’s director of investment strategy and country economist, Mohd Sedek Jantan, said the Venezuela situation boosted demand for liquid reserve assets, particularly the US dollar. “The move was reinforced by firm US growth momentum, which has pushed back expectations of interest rate cuts in the United States and kept yield differentials supportive of the greenback. As a result, emerging market currencies, including the ringgit, face short-term pressure despite stable domestic fundamentals,” he told Bernama. At the close, the ringgit traded lower against a basket of major currencies. It depreciated against the Japanese yen to 2.5932/5965 from 2.5817/5848 last Friday, weakened versus the British pound to 5.4706/4774 from 5.4509/4569, and dipped vis-à-vis the euro to 4.7540/7598 from 4.7488/7540 previously. The local note traded lower against ASEAN peers. It inched down vis-à-vis the Indonesian rupiah to 243.0/243.5 from 242.2/242.6, and fell against the Singapore dollar to 3.1603/1644 from 3.1502/1540. It slipped versus the Thai baht to 12.9891/13.0109 from 12.8996/9201, and was almost flat against the Philippine peso at 6.88/6.90 from 6.88/6.89 previously. Ringgit lower vs US dollar on geopolitical uncertainty

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

1 US Dollar

4.1350 2.7730 3.2050 3.0000 4.8350 2.3850 3.2050 5.5520 5.2400 3.4350 59.3600 66.3600 53.4900 4.6800 0.0258 2.6470 42.0500 1.5300 7.1200 114.0400 111.1400 25.9100 1.4000 46.1100 13.7000 113.6000 N/A

3.9870 2.6580 3.1030 2.9150 4.6760 2.2950 3.1030 5.3710 5.0140 3.2080 56.8200 61.0200 50.8000 4.3500 0.0228 2.5240 38.6500 1.3700 6.6900 108.2600 105.5000 23.4000 1.2200 41.9600 12.1400 107.6300 N/A

3.9770 2.6420 3.0950 2.9030 4.6560 2.2790 3.0950 5.3510 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

107.4300 3.0080 60.8200 50.6000 4.1500 0.0178 2.5140 38.4500 1.1700 6.4900 108.0600 105.3000 23.2000 1.0200 41.7600 11.7400 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

Pekat Bhd Buy. Target price: RM1.90

SBS Nexus Bhd IPO Fair value: RM0.27

Jan 5, 2025: R M1.70

Source: Company prospectus, PublicInvest Research

Source: : S&P Global, TA Research

Source: Bloomberg, Phillip Capital Research

SBS Nexus provides branding and marketing solutions across offline and digital channels. Its offerings include out-of-home media, public relations and event management, as well as online marketing, digital broadcasts, and mobile and web-based applications. The group also organises business awards and networking events as part of its lead generation initiatives. SBS Nexus has consistently delivered revenue growth, reflecting a shift toward budget-rich customers and deeper cross selling across its offline and digital branding solutions. Core profit is projected to grow at a 3-year CAGR of 20%. The group plans to hire 50 employees to strengthen its in house capabilities in content creation, graphic design, video production, and IT to reduce reliance on third-party providers, which in turn supports scalable margins. SBS Nexus is targeting the Malay market, leveraging its strength in branding and digital solutions to access additional client segments and diversify its revenue base. The Malaysian branding and marketing industry is competitive and fragmented with low entry barriers. While major media groups such as Media Prima Bhd, Media Chinese International Ltd and Star Media Group Bhd command significantly larger revenues due to their ownership of proprietary media assets, they compete with SBS Nexus in the provision of branding and marketing services rather than on a like-for-like business model. In FY2024, SBS Nexus captured a 0.34% market share in the offline branding solutions and 0.31% in the digital branding solutions market in Malaysia. Our fair value of RM0.27 is derived from 10x price-to-earnings ratio pegged to its FY27F EPS of 2.7 sen. – PublicInvest Research, Jan 5

PEKAT’ S 60%-owned subsidiary, EPE Switchgear, has secured a RM113.3m contract from TNB for the supply of 11kV motorized ring main units (RMU) with interconnector and remote control boxes (RCB) of various configurations in accordance with TNB’s requirements and specifications. EPE Switchgear is required to provide a RM5.7m performance security, equivalent to 5% of the contract value. The contract spans over two years. This marks EPE Switchgear’s first contract secured in 2026, lifting Pekat’s outstanding order book to RM745m (equivalent to 2.6x 2024 revenue cover ratio). The order book is primarily composed of power distribution (54%), solar (25%), ELP (19%), and trading (2%). This award accounts for 21% of our RM546m full-year 2026 order replenishment assumption. We expect this contract to deliver a 10 12% net profit margin, consistent with EPE Switchgear’s historical margin. This would translate into RM7-8m PATAMI, representing 13 14% of our forecasted PAT for 2026. Looking ahead, we expect continued healthy order replenishment across all divisions, with solar supported by the recently announced LSS5+ and upcoming LSS6; ELP stands to benefit from a robust data centre project pipeline; and EPE Switchgear remains a key player within TNB’s supply chain. We make no changes to our earnings forecast as this contract win falls under our order replenishment assumption. We remain positive on Pekat’s earnings prospects as it continues to benefit from Malaysia’s renewable energy initiatives. Key downside risks include project execution delays, intense market competition, and volatility in solar PV panel prices. Maintain BUY and RM1.90 TP. – Phillip Capital Research, Jan 5

MALAY S IA’ S manufacturing sector maintained its momentum in December 2025, signalling a modest but sustained improvement in operating conditions. The S&P Global Malaysia Manufacturing PMI remained unchanged at 50.1, marking a second consecutive month above the neutral 50 threshold. However, the pace of new orders softened during the month, prompting manufacturers to recalibrate their purchasing activity amid still-fragile demand conditions. New orders eased slightly in December after registering a modest expansion in the preceding month, reflecting subdued demand conditions. Meanwhile, new export orders continued to soften for a fourth consecutive month. Although the pace of contraction remained mild, it was marginally more pronounced than in the previous survey period, indicating persistent weakness in external demand. Malaysian manufacturers encountered renewed challenges in sourcing inputs on time during the month, as suppliers’ delivery times lengthened following a modest improvement in November. The deterioration was attributed to adverse weather conditions and congestion. Nevertheless, delivery delays remained marginal, partly reflecting subdued input purchasing amid the absence of strong growth in production and new orders. In line with subdued purchasing activity and longer input delivery lead times, stocks of purchases declined again in December, extending the contraction to a sixth consecutive month. Nonetheless, the pace of inventory drawdown was modest and eased to its weakest rate in three months, suggesting a degree of stabilisation in inventory management. – TA Research, Jan 5