MAYBANK Malaysia 2025 Outlook & Lookouts...

Brace up for a volatile year.

- Navigating opportunities and challenges
Navigating Trump 2.0 would be a task in 2025. Although ASEAN will likely not be a priority or a direct target, Malaysia could catch some attention as it has been a beneficiary of trade diversion. Domestically, Malaysia is seeing an investment upcycle wave with non-trade growth engines including tourism, data centres and ASEAN Economic integration as growth supports. We list five themes to play in 2025, mostly centric on consumption and investment realisation. We have a 2025 YE KLCI target of 1,740 (15x 2026E PER), driven mainly by banks, which is our key OW.

- Malaysia Equity: Themes to play in 2025
We lay out five themes to lookout in 2025: (1) External disruptions: We see opportunities in a shift of trade diversion to trade diversification which would benefit manufacturing and tech plays, (2) Domestic secular plays: Hedging uncertainties externally, we see positive trends
to benefit banks, consumer and tourism (incl REITs), (3) State-driven activities: Following through from Johor, Sarawak and Penang where we will continue to see investment action, we would also watch for developments in Sabah, Kedah and Perlis in the energy and EV space, (4) Investment realisation: After receiving strong approved investments since 2023, it is time to reap the fruits of the harvest. We expect positives from tech, construction and industrial properties to spread to second order beneficiaries such as consumer, retail and offices, (5) Corporate restructuring: We expect to see a stepping-up
of GLC reinvigoration given new head honchos on board. Separately, we expect the GEAR-uP initiatives to take
shape in 2025.

- Positioning for 2025: Growth, yields and ESG
We forecast YE 2025 KLCI target of 1,740 (15x 2026E PER), driven mainly by banks, our key OW. We are also OW consumer and healthcare while selectively positive on construction (DC plays), oil & gas (FPSOs) and tech (EMS). Other key sectors such as property, plantations, telcos and utilities are Neutral. Petrochemicals is our only Underweight. Our BUYs are AMMB, CIMB, Gamuda, YTLP, Hartalega, KPJ, VSI, Frontken, Aeon and Solarvest. Top Sells are Lotte Titan, Astro, Tan Chong, BFood and RCE. Top 5 high-yield picks in FY25E-26E are Eco World Int’l, Bermaz Auto, DXN, MBM Resources and Sentral REIT. Not forgetting, our ESG picks are Allianz, Gamuda, IOI, Public Bank and Hong Leong Bank.

$GAMUDA / 5398 (GAMUDA BERHAD)
$VS / 6963 (V.S. INDUSTRY BERHAD)
$SLVEST / 0215 (SOLARVEST HOLDINGS BERHAD)