09/03/2026

BIZ & FINANCE MONDAY | MAR 9, 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

Foreign funds exit Malaysian bonds as global volatility rises KUALA LUMPUR: Foreign investors recorded net outflows of RM2.5 billion in February, from RM1.0 billion in January, ending a four-month streak of inflows. Kenanga Investment Bank Bhd said the reduced appetite for longer tenor government securities reflected heightened caution following global market volatility. Foreign holdings declined to RM299.2 billion in February, from RM301.7 billion in January, lowering their share of total outstanding debt to 13.1% from 13.3% in January. Kenanga IB said early February saw sizeable outflows of about RM3.0 billion, following movements in the US Treasury market after US President Donald Trump named Kevin Warsh as the new Fed chair on Jan 31. Bond market movements indicated softer foreign demand, with overall outflows driven by continued selling in Malaysian Government Securities (MGS), Government Investment Issues (GII), and corporate bonds and sukuk (CBS). Inflows into MGS moderated to RM0.5 billion from RM3.9 billion in January, reducing foreign ownership slightly to 33.9% from 34.1%. Outflows from GII persisted at RM1.4 billion, down from RM1.8 billion in January, edging foreign ownership down to 7.8% from 8%. Meanwhile, outflows from CBS widened to RM1.7 billion from RM0.7 billion previously, lowering foreign ownership to 2.0% from 2.2%, largely due to selling in corporate bonds amounting to RM1.5 billion. “We expect inflows into the local debt market to remain muted in the near term as global risks persist. The US-Israel strike on Iran at the end of February is likely to push foreign outflows higher in March, as any escalation could disrupt cross-border supply chains and energy markets,” Kenanga said. Mega First Corporation Bhd Outperform. Target price: RM5.12

THE ringgit is expected to trade cautiously against the US dollar this week as market sentiment continues to be shaped by developments in the Middle East, while investors will also keep a close watch on the trajectory of crude oil prices and upcoming US economic data. Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the focus this week will continue to be on the Middle East conflict. He said important data points include the US Consumer Price Index and personal consumption expenditures for February, but the impact is likely to be overwhelmed by geopolitics. “What the market is hoping for is a de-escalation in the conflict, yet that seems to be elusive at the current juncture,” he told Bernama. Meanwhile, Kenanga Investment Bank Bhd opined that markets remain focused on the path of crude prices and their implications for US inflation and Federal Reserve policy. It noted that while Malaysia benefits economically from higher oil prices in the short term, the ringgit no longer behaves as a traditional oil proxy and instead trades more like a high beta emerging market currency. “Until investors gain clearer visibility on the conflict’s duration, the US dollar should remain supported, keeping the ringgit pressured around 3.94-3.98 per US dollar,” it added. On a week-on-week basis, the ringgit ended lower against the US dollar to close at 3.9425/9535 compared with 3.8910/8960 on the previous Friday. The local note edged down versus the Japanese yen to 2.4973/5044 yesterday from 2.4930/4963 a week earlier and fell vis-a-vis the British pound to 5.2530/2676 from 5.2470/2538. Middle East developments, US data to guide ringgit direction

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

1 US Dollar

4.0230 2.8320 3.1360 2.9350 4.6630 2.3780 3.1360 5.3650 5.1720

3.8770 2.7180 3.0360 2.8530 4.5110 2.2900 3.0360 5.1930 4.9500 3.1100 56.1000 58.8600 49.2200 4.1500 0.0220 2.4480 39.1400 1.3300 6.5100 105.5200 102.5400 22.6000 1.1800 40.8400 11.6900 104.7000 N/A

3.8670 2.7020 3.0280 2.8410 4.4910 2.2740 3.0280 5.1730 4.9350

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

110.4800 3.3540 58.5800 63.9800 51.8200 4.4700 0.0249 2.5670 13.7000 42.5700 1.4900 6.9100 111.1500 108.0200 25.0300 1.3600 44.8600 13.1900

104.5000 2.9100 56.1000 58.6600 49.0200

3.9500 0.0170 2.4380

N/A

38.9400 1.1300 6.3100 105.3200 102.3400 22.4000 0.9800 40.6400 11.2900

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

QES Group Bhd Outperform. Target price: RM0.47

Optimax Holdings Bhd Buy. Target price: RM0.79

March 6, 2026: RM3.00

March 6, 2026: RM0.385

March 6, 2026: RM0.565

Source: PublicInvest Research

Source: PublicInvest Research

Source: Bloomberg, Phillip Capital Research

MANAGEMENT is increasingly confident that the Batu Kawan plant could turn around earlier than expected following some positive talks with the China-based equipment makers. Despite a disappointing performance from the manufacturing segment last year due to weak semiconductor sales, this year, manufacturing is set to see a change of fortune this year, thanks to the robust orders from the med-tech products. The group experienced a slight drop in FY25 sales, down 1% YoY to RM266.8m, mainly dragged by weaker momentum in the manufacturing segment (-27.7% YoY) as local semiconductor activities slowed down. In terms of sales breakdown by industry, automotive overtook semiconductor to become the biggest sales contributor, making up 33.9% of group sales. Semiconductor came in second at 33.2%, followed by E&E, 20.7%. The semiconductor segment registered a decline of 23.7%, dragged by lower Automated Wafer Handling System (AHS) equipment deliveries to the front-end wafer fab located in Kulim. Under the manufacturing division, AHS, which is designed to automate the material handling processes for semiconductor wafers, was the sole underperformer as sales slumped 78% YoY due to a lack of bulky deliveries compared to 3 units in FY24. Despite registering a loss of RM2.2m in FY25, the Batu Kawan plant could see a turnaround sign earlier than expected after securing lucrative medical technology (under SMS segment) orders from a US-based medical device company specialising in glucose reading worth RM18m, and it could potentially increase to RM25-28m. Bulk of the med tech orders (about 8-10 units), which are destined to the US, Chile and Ireland operations, are expected to be delivered by mid-2026. Upgrade to Outperform with higher TP of RM0.47. – PublicInvest Research, March 6

DURING the analyst briefing, management highlighted that it will either scale back investment or exit non-core businesses to realign its focus on Renewable Energy (RE). To prepare for the next large scale RE project, the group will i) prioritise cash preservation, ii) strengthen RE operations, and iii) rationalise non-core businesses. In view of that, we estimate that the group’s cash level will swell to RM1bn (from RM466m) level this year, bringing down the net gearing to a minimal level. Ringgit appreciation remains the key headwind for the group as more than 90% of its income is derived in USD. RE continues to grow. Two turbines at the Don Sahong Hydropower plant are undergoing an overhaul exercise at a cost of USD2m for each turbine, and it will take up to 3 months. This would result in a slight decline in FY26’s Energy Availability Factor (EAF) compared to FY25’s 83.1%. Nevertheless, the group expects a positive growth for the RE segment as the lower EAF will be offset by a slight upward adjustment for the hydro tariff (from 6 to 6.05sen) and commissioning of two new large-scale solar plants totalling 62.4 MWp by 2Q 2026. With the kick-in of the corporate tax on Don Sahong earnings at an annual incremental rate of 5% starting this year, before rising to the standard rate of 24% in 2030, the group expects an effective tax rate of 3.5-4% for FY26. Management is currently exploring several RE opportunities, namely, i) five dams dubbed Cascading Power Sources in Sarawak (100-300MW), ii) Laos (Hydro project and water rights), iii) Cambodia (wind project), and iv) throughout Malaysia (Battery Energy Storage Systems, Corporate Renewable Energy Supply Scheme, pumped storage hydropower, and LSS6 projects. The scale of the project investment that it is eyeing will be around RM1bn. – PublicInvest Research, March 6

OPTIMAX is progressing steadily with its Kempas and Selgate hospitals, both currently under construction and renovation, with completion targeted by 3Q26 and operations expected to commence in 1Q27. The ACC at Pantai Indah Kapuk (PIK), Jakarta, is also undergoing renovation, with operations planned for early-27, supported by biweekly visits from Malaysia-based doctors to ensure continuity of service and operational quality. Separately, Optimax plans to launch Juicemax, a food, beverage, and in-house supplements store, at its Atria ACC by the end of Mar26, transitioning prior online and clinic sales into a physical location to enhance the customer experience. Moving forward, surgery is expected to account for the bulk of the group’s revenue at over 90%. We anticipate softer QoQ earnings in 1Q26 due to the festive holidays, which reduce clinic operating days. Optimax’s latest venture into otorhinolaryngology (ENT) services is expected to see minimal cash outflow, with annual capex spending projected below RM1m as the group leverages the existing operating theatre (OT) at Atria ACC. Management plans to utilise 4 existing OTs to boost utilisation, targeting 60-70% from the current 50% once the ENT segment is operational. Optimax plans to establish 2 ENT clinics over the next 3-years, adopting a conservative performance-based rollout strategy similar to the Neumax model, which was launched in late-24, achieved profitability in 2025, and is now progressing towards a second centre in the Klang Valley. We view current valuations as undemanding, with the stock trading at -1SD its 3-year mean. Key downside risks include weak consumer spending, which could lead to lower foot traffic, delays in the expansion plan, and a shortage of licensed medical practitioners. Maintain BUY rating with an unchanged TP of RM0.79. – Phillip Capital Research, March 6