18/03/2026

BIZ & FINANCE WEDNESDAY | MAR 18, 2026

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Adnex makes strong market debut, confident about growth

CIMB: Goodwill discounts to have negligible impact on banks, NBFC PETALING JAYA: CIMB Securities Sdn Bhd views the introduction of goodwill discounts tied to the Rule of 78 as having a negligible impact on domestic banks and non-bank financial companies (NBFC), reflecting the measure’s largely transitional nature. The research firm said the overall impact on banks and NBFC is expected to be negligible, as guidance from most financial institutions (FI) suggests that customers who opt for early settlement account for a relatively small proportion of the overall hire-purchase portfolio in any given year. “From our channel checks, some of these FI already offer financing packages based on the ‘reducing-balance’ methodology; hence, there is little incentive for borrowers to switch from one financing package to another. “Given that early settlements usually occur mid-cycle or closer to maturity, the quantum of unearned interest subject to potential ‘goodwill adjustments’ remains limited and unlikely to be material for both borrowers and FI,“ CIMB Securities said in a note. On Monday, the Association of Banks in Malaysia, Association of Islamic Banking and Financial Institutions Malaysia and Association of Development Finance Insti tutions of Malaysia said banks will offer “goodwill discounts” to certain customers from June 1, 2026, to March 31, 2027. The discounts apply to customers who choose to settle their existing fixed-rate hire purchase loans early, particularly those calculated using the Rule of 78 method, ahead of the implementation of the Hire Purchase (Amendment) Act. To qualify, customers must be in good repayment standing, with accounts not more than 90 days overdue, not under legal action or repossession, and not part of any restructuring, rescheduling, or formal debt management pro gramme. The initiative aims to help borrowers transition to the new framework while improving transparency in hire-purchase financing. CIMB Securities maintains its Overweight rating on the banking sector, with a more defensive stance on its macro outlook. The firm said solid capital and liquidity buffers at 14.5%, liquidity coverage ratio at 152%, and loan loss reserve coverage at 125.9% as at January 2026) provide banks with ample capacity to absorb unexpected credit losses while maintaining lending activity through the cycle. Dividend visibility remains firm, anchored by payout ratios of 50-70% and yields of 5.0-6.6%. “Our preferred sector ex posures are RHB Bank, Public Bank, and Hong Leong Bank,“ the firm said.

phical expansion into East Malaysia by the end of the year, while laying the groundwork for selective overseas ventures. However, it indicated that it will approach international expansion cautiously, with timelines dependent on market readiness. Growth visibility appears sup ported by a solid order book. As of January 2026, Adnex reported an outstanding order book of RM66 million, alongside a tender book of about RM130 million, with a historical success rate exceeding 50%. This pipeline, management said, underpins confidence in delivering strong growth momentum for the current financial year, with ex pectations that performance could potentially more than double. Adnex’s revenue surged to RM94 million in the financial year ended 2025, a RM44 million increase from the previous year, driven largely by higher project execution and the group’s ability to undertake larger and more complex jobs. The company operates on a

with 89 million shared traded. Managing director Kan Wai Chun described the listing as a turning point for the group, marking its transition from a long-established private outfit into a publicly traded company with broader growth ambitions. “From a small company more than 30 years ago, we’ve become a listed company today. This is not the finish line, but the beginning,” he said at a press conference following the listing ceremony. Despite the strong debut, Kan emphasised that the group’s priority remains operational delivery rather than short-term share price move ments. “Our focus now is to continue executing our projects well. In the long run, the market will reflect the true value of our company,” he said. Adnex raised RM18.1 million from its initial public offering, with proceeds earmarked primarily for business expansion, working capital and project-related commitments such as performance bonds. The group is targeting geogra

project-based model, primarily serving corporate offices, multi national companies and commercial clients. While not strictly recurring, repeat business remains a key feature, with management estimating that 30% to 50% of projects come from returning clients. On industry trends, Adnex remains upbeat on demand despite evolving workplace dynamics and macroeconomic uncertainty. “The demand from the market is still strong,” Kan said, pointing to the group’s current order book as evi dence of sustained activity in the sector. The group also highlighted its execution capabilities and ex perienced team as key differentiators in a competitive industry often cha racterised by pricing pressure. “Execution capability and track record are what set us apart. With our experienced team, we are able to consistently deliver quality,” Kan said. Addressing cost pressures, parti cularly from fluctuating material and labour costs, management said it maintains close coordination with suppliers and subcontractors to manage pricing and ensure quality control. Adnex relies on a network of over 1,000 contractors and suppliers, which it said helps mitigate supply chain risks and provides flexibility in project execution. On external risks, including geopolitical developments and rising energy prices, the group said there has been no significant immediate impact on operations. However, it acknowledged that prolonged increases in fuel costs could affect logistics expenses over time. At the same time, the group sees potential upside from shifting global investment flows, particularly into Southeast Asia, which could support demand for commercial and corporate fit-out projects. As it begins its journey as a listed entity, Adnex is positioning itself to capitalise on these trends, balancing expansion with operational discipline. “We are confident in delivering sustainable growth,” Kan said.

o Interior fit-out specialist’s shares open and close at 25 sen, 25% above offer price

Ű BY DEEPALAKSHMI MANICKAM sunbiz@thesundaily.com

KUALA LUMPUR: Interior fit-out specialist Adnex Group Bhd made a firm debut on the ACE Market of Bursa Malaysia yesterday, opening 25% above its IPO price, as the group signalled confidence in sustaining growth backed by a healthy order pipeline and expansion plans. The counter opened at 25 sen against its issue price of 20 sen, reflecting positive investor sentiment towards the company’s execution track record and positioning in the commercial fit-out segment. The stock closed at 25 sen also,

From left: Adnex Group independent non-executive directors Yeo Jie Yin and Cheong Woon Chee; Public Bank Investment Bhd CEO Lee Yo-Hunn; Kan Wai Choon; Adnex Group non-independent executive director Kan Wai Peng; independent non-executive chairman Datuk Mohd Zaid Zakaria; and independent non-executive director Dr Soon Fong Piew. at the listing ceremony.

M’sian utilities sector seen insulated from global energy shocks KUALA LUMPUR: Malaysia’s utilities sector is seen as relatively insulated from current geopolitical energy shocks compared with many Asean peers, both from a system reliability and sector earnings perspective, according to CGS International Securities. adjustments over time, but we see these as manageable, with limited direct earnings impact for utilities and low risks of power supply disruptions. “The main exception is YTL Power International Bhd, whose exposure to the Singapore merchant power market means earnings are more sensitive to fuel price movements,” it added. LNG imports in 2025, while Brunei has emerged as a secondary supplier. “Notably, Malaysia has not imported LNG directly from the Middle East in recent years, limiting its exposure to potential geopolitical disruptions in that region,” it said. “Our broader investment thesis on the sector remains intact. We expect rising electricity demand and strong policy momentum led by the NETR to drive a multiyear investment cycle, while several company-specific head winds that weighed on share prices and earnings in 2025 are beginning to reverse,” it said.

Overall, the securities firm said Malaysia’s strong domestic supply base provides a high degree of insulation from global gas supply shocks, for now. “Although reliance on LNG imports, we expect, will gradually increase as domestic gas fields mature and gas power plant installed capacity expands alongside the coal-to-gas transition for baseload under the National Energy Transition Roadmap (NETR).

In a note yesterday, CGS International said that while the country’s coal- and gas-heavy generation mix exposes the power system to global fuel price movements, the impact is mitigated by a regulated tariff framework with fuel-cost pass-through mechanisms, partially capped gas prices, and a strong domestic gas supply base. “As such, higher coal and gas prices may translate into some upward tariff

CGS International maintained an Overweight call on the Malaysian utilities sector, noting that the country is entering its most investable power sector cycle in over a decade, evolving from a solar-led transition to a broader capacity-expansion cycle spanning gas-fired generation, renewables, battery storage, gas infrastructure, and grid upgrades. – Bernama

CGS International said it estimates that 85% of Malaysia’s gas supply is sourced domestically (including 5% to 10% from the Malaysia-Thailand Joint Development Area), with the balance supplied via liquefied natural gas (LNG) imports. “Over the past six years, Malaysia has primarily sourced its LNG imports from Australia, which accounted for 96% of