EPF recovers RM1.5b of RM6b loss in value

Fund sees biggest jump in portfolio value in CMS by 37.93% to RM400,000


The Employees Provident Fund (EPF) has recovered RM1.5 billion of the RM6 billion loss in investment value for its 10 public-listed investee companies, two months after the 14th General Election (GE14).

Last month, the media reported that the fund had suffered a 12% drop in investment value amounting to RM6.09 billion between May 8 (a day before GE14) and June 7 through its top 10 worst performing counters.

The investee companies were Cahya Mata Sarawak Bhd (CMS), Malaysian Resources Corp Bhd (MRCB), IJM Corp Bhd, Gamuda Bhd, Telekom Malaysia Bhd (TM), Axiata Group Bhd, Tenaga Nasional Bhd (TNB), CIMB Group Holdings Bhd, Malayan Banking Bhd (Maybank) and Genting Plantations Bhd. The EPF’s stake value in the 10 companies was RM51.21 billion on May 8.

Tracking the same companies last Friday, a compilation by The Malaysian Reserve (TMR) showed the EPF’s shareholding value in the 10 companies has risen by RM1.52 billion to RM46.63 billion from Rm45.11 billion on June 7. However, the EPF still has to recover RM4.5 billion of the initial rm billion wiped out post-GE14.

All the 10 counters have improved, except for Genting Plantations (-11.86%), TM (-8.4%), CIMB (-4.31%) and Axiata (-2.56%) as the loss widened between June 7 and Aug 10.

The downtrend in crude palm oil price since end-2017 has brought negative sentiments to palm oil planters including Genting Plantations.

TM, CIMB and Axiata were impacted due to Pakatan Harapan administration’s crackdown on all government-linked companies that led to changes in management.

TM also recently announced it had cancelled its collaboration with TNB on the Nationwide Fiberisation Plan, which in turn fuelled negative sentiment in the market.

On the other six counters, the EPF has recuperated some of the losses in its investment value, partly because the fund has been buying more units leveraging on the depreciating share prices. The EPF saw its biggest jump in portfolio value in CMS by 37.93% to RM400,000 between June 7 and Aug 10.

The EPF is one of the most active, as well as among the largest investors on Bursa Malaysia. As at last Friday, it controlled RM165 billion of Bursa’s total market value via 245 public-listed companies.

Some 95% of the EPF’s investment is in the local market. CEO Tunku Alizakri Alias said EPF assets under management will reach RM1 trillion in the next two to five years, from the current RM814.38 billion.