Bursa Malaysia’s top performers and losers

Investors have voted with their money which has flowed into stocks that have shown a marked improvement in earnings or prospects

by SHAZNI ONG/ pic by TMR

THE prospects of a weaker economy and cut in the Overnight Policy Rates (OPR) have impacted banking stocks negatively, while improved cost control measures attracted investors to telecommunications company (telco) stocks.

As Bursa Malaysia seeks catalysts to retest the 1,600-point level ahead of Budget 2020, investors have voted with their money which has flowed into stocks that have shown a marked improvement in earnings or prospects.

According to Bloomberg, as of last Friday, Public Bank Bhd has lost some 18.49% or RM17.7 billion in market value to RM78.03 billion year-to-date (YTD).

Public Bank earnings declined 4.5% year-on-year (YoY) to RM1.33 billion in the second quarter (2Q) as a result of the OPR reduction.

Petronas Chemicals Group Bhd (PetChem) was another big mover losing some 18.61% or RM13.76 billion in market capitalisation to RM60.16 billion over the same period.

PetChem saw its net profit dropped by 22.3% YoY in 2Q19 ended June 30, 2019, as its revenue was impacted by lower crude oil prices, weaker demand and higher tax expenses.

Hong Leong Bank Bhd (HLB) was the other big loser, with its market capitalisation dropping 14.71% or RM6.11 billion to RM35.42 billion YTD.

This came about despite HLB’s net profit rising 1.7% YoY to RM636.45 million in 4Q19 ended June 30, 2019, on a higher share of profit from associates.

Other companies that saw their market capitalisation fall significantly YTD were Malayan Banking Bhd (Maybank) and British American Tobacco (M) Bhd (BAT).

Maybank, which maintained its top spot in terms of the largest capitalised counter on the local exchange, saw its market value drop RM5.82 billion to RM97.8 billion, while BAT’s market valuation dipped RM4.92 billion to RM5.48 billion over the same period.

As we move into the final quarter of the year, Axiata Group Bhd remains the biggest gainer in terms of market value as the telco giant’s market capitalisation grew by 16.1% or RM5.51 billion to RM39.71 billion YTD.

The figure would have been higher if not for Axiata and Telenor ASA, Digi. Com Bhd’s parent, ending talks on a proposed non-cash merger of their Asian telecommunications and infrastructure assets.

Another big gainer over the nine months was MISC Bhd which saw its market value rise by 17.54% or RM5.13 billion to RM34.37 billion on improved financial results.

The other big gainer was Telekom Malaysia Bhd (TM), with its capitalisation improving by more than a third — or 38.23% or RM3.75 billion — to RM13.56 billion.

TM saw its net profit grew 12% in 2Q19 ended June 30, 2019, to RM114.18 million on lower operating costs.

Other companies that saw market capitalisation improvements were Gamuda Bhd and IHH Healthcare Bhd. Gamuda’s market value has spiked by 58.42% or RM3.33 billion to RM9.03 billion over the last nine months, while IHH Healthcare saw its capitalisation increased by RM3.27 billion to RM50.1 billion.

In terms of share price increase YTD, KNM Group Bhd leads the list, registering a 413.3% gain since January this year.

KNM market capitalisation has spiked 429.65% to RM994.1 million, while its share price is now trading in the 40 sen region compared to eight sen in early January.

This came about after the company increases its presence in renewable energy (RE) to diversify its income base away from project-based contracts.

The RE business provides the equipment manufacturer and engineering services provider a recurring income base.

KNM currently operates a bioethanol plant in Thailand with a production capacity of up to 400,000 litres per day. It further runs an 80MW waste-to-energy power plant in Peterborough, UK. The company has also secured a new contract for equipment supplies from various clients.

Other companies that gained significantly in share value are Sealink International Bhd (304.76%), MNC Wireless Bhd (300%), G3 Global Bhd (268.1%) and Dayang Enterprise Holdings Bhd (205.56%).

Companies that have lost significant share value YTD are London Biscuits Bhd (-80.31%), Meridian Bhd (-76.27%), MCT Bhd (-71.81%), Dynaciate Group Bhd (-65.22%), MSM Malaysia Holdings Bhd (-60%) and Utusan Melayu (M) Bhd (-56%) according to Bloomberg.

As of last Friday, the FTSE Bursa Malaysia KLCI (FBM KLCI) was down by 6.3% on a YTD basis.

That said, the Bursa Malaysia Small Cap Index is up 15.2% since the start of the year, while the Bursa Malaysia Mid 70 Index is up 6.54%.