TA SECURITIES TOP PICKS 2025

Shifting Into High Gear.

This year has laid a strong foundation for economic recovery, setting the stage for continued growth in 2025,
which should positively impact the equity market. Key factors underpinning a positive outlook for equities include: 1) A stronger domestic economy and improving fundamentals, supported by a resilient global economy, 2) Increased foreign and domestic investments, 3) Structural reforms backed by a strong government, boosting the country’s finances and investor confidence, 4) Continuous growth in corporate earnings, supporting expansion in valuation multiples, and 5) A net inflow of foreign funds. However, we anticipate several downside risks that could undermine investor confidence next year: 1) Geopolitical tensions, 2) Trade wars, and 3) Deflationary pressures in China. There could be some volatility in the local equity
market during the early periods of Donald Trump’s second presidency, but in our view, Malaysia has its own merits in remaining resilient and eventually emerging stronger. Our 2025 FBMKLCI target is 1,845, based on a CY26 PER of 15.5x, still undemanding compared to its 5-year (2020-2024) average of 17.0x.

Maintaining our cautiously optimistic outlook on local equities and anticipating a potential 15.5% upside for the FBMKLCI, we recommend the following key investment themes for 2025:
1) Growth Stocks (BNASTRA & PGF): Focus on agile small cap players poised to seize opportunities and deliver strong earnings growth.
2) Disruptive Technologies and Digital Economy (INARI. TM & YTLPOWR): Significant investments in the E&E sector, data centres, and related infrastructure will drive this theme.
3) Domestic Spending and Resilient Economy (AEON,FFB, FOCUSP, GAMUDA, SUNCON, MAHSING, IOIPG, SIMEPROP, CIMB, MAYBANK & PBBANK): Benefiting from a strong labour market, higher disposable income, improving tourism and related industries, robust investments, greater capital market activities and the largestever allocation under Budget 2025.
4) Energy Transition (SAMAIDEN & TENAGA): Aligning with sustainable development goals.
5) Stronger Ringgit (ASTRO & LHI): Favouring companies with high domestic business and import content.

$IOIPG / 5249 (IOI PROPERTIES GROUP BERHAD)
$POLY / 8117 (POLY GLASS FIBRE (M) BERHAD)
$FOCUSP / 0157 (FOCUS POINT HOLDINGS BERHAD)