AUTOMOTIVE
[%hAFb%] 
Research by Kenanga
Neutral

“No-Frills Vehicles in Pole Position”

We remain NEUTRAL on the sector. We also maintain our projection for industry-wide sales volume, also known as total industry volume (TIV), of 740k units (-8%) in CY24, in line with the forecast of Malaysia Automotive Association (MAA). We believe while it will be business as usual for the affordable segment, fuel subsidy rationalisation will likely hurt the demand for mid-market models, giving rise to a two-speed automotive market locally in CY24. In general, the industry’s earnings visibility is still good, backed by a booking backlog of 200k units. Our sector top pick is MBMR (OP; TP: RM6.30), a good proxy to the affordable and fuelefficient Perodua brand. It also offers an attractive dividend yield of about 7%.

Analyst(s):
Wan Mustaqim Bin Wan Ab Aziz 
[%fdsQ%]

AUTOMOTIVE
$KLSE-MBMR 
Research by Kenanga
Neutral

“No-Frills Vehicles in Pole Position”

We remain NEUTRAL on the sector. We also maintain our projection for industry-wide sales volume, also known as total industry volume (TIV), of 740k units (-8%) in CY24, in line with the forecast of Malaysia Automotive Association (MAA). We believe while it will be business as usual for the affordable segment, fuel subsidy rationalisation will likely hurt the demand for mid-market models, giving rise to a two-speed automotive market locally in CY24. In general, the industry’s earnings visibility is still good, backed by a booking backlog of 200k units. Our sector top pick is MBMR (OP; TP: RM6.30), a good proxy to the affordable and fuelefficient Perodua brand. It also offers an attractive dividend yield of about 7%.

Analyst(s):
Wan Mustaqim Bin Wan Ab Aziz 
wanmustaqim@kenanga.com.my