Sime Darby Berhad

$SIME / 4197 (SIME DARBY BERHAD)
Research by CGSI

$SIME / 4197 (SIME DARBY BERHAD)
Research Report by TA

$SIME / 4197 (SIME DARBY BERHAD)
Research Report by KENANGA

$SIME / 4197 (SIME DARBY BERHAD)
Research Report by CGSI

KUALA LUMPUR: Sime Darby Bhd is set to bring in luxury electrice vehicle (EV) Denza into Malaysia through a Denza importation & distribution agreement with BYD Auto Industry Co., Ltd.

© New Straits Times Press (M) Bhd

Sharing market perspective from broker. Found it useful..

CHINA ROARING BUT MY STILL ATTRACTIVE; RINGGIT DOUBLED EDGED SWORD; FPSO STILL BRIGHT SPARK IN O&G SPACE; ASTRO TURNING AROUND?; PROFIT TAKING FLOWS...

*MY MKT:* *YES, CHINA IS EXCITING AGAIN BUT M’SIA REMAINS THE MARKET TO BE IN =)* In fact, there are many questions remain and execution is key for China esp. fiscally. The capital injections into SOE banks would help but as Michael (CH banks analyst) noted, he’s unsure which segments could *drive loan growth* as households may not be a driver unless *property transactions/consumer confidence* pick up materially. What’s more if demand’s weak, it won’t matter if corporates are given funds while banks may not dare to lend unless they’re absolved of blame for bad debts. Hence, focus on *MY domestic mkt.* though on flows, we see local insti funds are realizing profits.

Yes, ringgit’s strength is a double-edged sword ie. *good for importers but a bane for exporters.* Regardless, seasoned FMs we spoke to aren’t too worried as weaknesses seen in exporters are *short-term knee-jerk* effects. Take *VSI* for instance, stock was beaten down on weak USD as *ASP adjustments are done qtrly.* However, correction is an opportunity to collect instead as eventually, currency differences will be *passed on* while underlying demand for its clients’ *products are healthy.* *SIME’s* position is even *better.* Contrary to mkt. perception, SIME’s a *net beneficiary of RINGGIT gains* due to acquisition of *UMW.* Although *China/industrial* operations have ongoing challenges, thanks to *currency and full UMW* impact, its M’sia based *PBIT contribution will increase* from 24% in ’23 to *60% by ’25,* showing how *accretive UMW is.* Plus, *60% of component costs* are sourced abroad and currency *savings* from this alone flow *straight to EBIT.* All in, with China stimulus, SIME could win on *both* currency and China fronts.

Meanwhile, it’s *not getting better* for O&G services here till better clarity on issues like *Petros/Petronas* and of course, escalating *Mid East* conflict isn’t helping but at least, *FPSO segment* still looks lively. *MISC* looks likely to achieve *first oil for FPSO Mero-3* in the coming days and this a *huge catalyst for 4Q* earnings though this call comes with *caveat* as Petronas *will end 5 x legacy LNG* charters in 27-28 and replace them with charters for *2 x LNG from ‘27* onwards. Basically, it seems *most/all of MISC’s* maturing long term LNG charters with Petronas *will not be extended* for the long haul (20 yr) which Raymond thinks will be a *2-3% negative to earnings.* He’s not worried though as LNG charter *terminations were sort of expected* as other shipping companies can offer *better terms* to Petronas while MISC’s legacy vessels are also *not up to IMO* standards. BUT, MISC now has *orders for 10 x LNG ships* which should more than help *arrest the decline* in LNG earnings from *FY26 onwards* and yes, Mero 3 will be the *driver in FY25.*

Similarly, *YINSON’s* MQ & Atlanta FPSOs will achieve *first oil in Oct and Dec* respectively which is *music to investors’ ears* as this means cash *inflows* from charter hire. Recall, YINSON is a well-run company, in the *right space ie FPSO* and so, its management still wants to take advantage of the *growth* in this segment, but this has come at the *expense of gearing* which has ballooned. So, achieving first oil will boost both *operating cashflows and investors’ confidence* as daily charter hire is paid only when the assets are working.

Finally, *ASTRO,* yes ASTRO just had its *best quarter* in a while *(5 qtrs of decline)* on among other things, *favorable forex impact.* Out of the woods? Hard to say as *rising content costs and adex weakness* persist but encouragingly, bundling/upselling strategies have *driven ARPU* higher. All in, it requires patience when it comes to *ASTRO turnaround* as costs savings are taking *longer* to materialize but at least, the strengthening *ringgit helps* the c.35% USD-based costs, and so, *reinstatement of dividends* could be on the cards which is a rerating catalyst. Hopefully…

$VS / 6963 (V.S. INDUSTRY BERHAD) $SIME / 4197 (SIME DARBY BERHAD) $MISC / 3816 (MISC BERHAD) $YINSON / 7293 (YINSON HOLDINGS BERHAD) $ASTRO / 6399 (ASTRO MALAYSIA HOLDINGS BERHAD)

$SIME / 4197 (SIME DARBY BERHAD)
Research by TA
Hold - TP RM2.74

"Motor Competition Heating Up"

Maintain SIME as HOLD with a revised TP of RM2.74/share, based on sum-of-parts (SOP) valuation.

Analyst:
Angeline Chin
angelinechin@ta.com.my

$SIME / 4197 (SIME DARBY BERHAD)
Research by RHB
Buy - TP RM3.10

"Industrial Segment Leads In Profitability; Still BUY"

Still BUY, new MYR3.10 SOP TP from MYR3.20, 21% upside, c.6% FY25F (Jun) yield. FY24 earnings met our forecasts but missed Street's full-year estimates. We remain positive on Sime Darby due to industrial wing’s strong performance in Australasia and full-year contributions from recently acquired UMW. It positions SIME towards providing a wide range of offerings across different market segments in the local automotive industry.

Analyst:
Syahril Hanafiah
syahril.hanafiah@rhbgroup.com

$SIME / 4197 (SIME DARBY BERHAD)
Research by Public
Neutral - TP RM2.45

"Dragged by China Operations"

Sime Darby reported a lower net profit of RM83.0m (-86.5% YoY, -76.2% QoQ) for the 4QFY24, mainly due to one-off impairments, provisions, and losses at the Motors Mainland China operations, as well as higher finance costs and
deferred tax provisions. Excluding non-operating items, the Group’s estimated core net profit stood at RM376.0m, bringing the 12MFY24 core net profit to RM1,275.0m (+15.4% YoY). The results were below both our and consensus
estimates, making up 90.0% and 91.4% of full year forecasts, respectively. This was largely due to weaker-than-expected performance at the Motors Mainland China operations. We cut our FY25-26F earnings forecasts by 10-14%, factoring in lower revenue and higher operating costs. Consequently, our sum-of-parts (SOP) based target price is revised to RM2.45 (from RM2.73). A second interim dividend of 10 sen per share was declared, bringing total dividend for the year to 13 sen per share (FY23: 13 sen per share). We maintain a Neutral rating on Sime Darby.

Analyst:
Denny Oh
research@publicinvestbank.com.my

$SIME / 4197 (SIME DARBY BERHAD)
Research by Kenanga
Outperform - TP RM2.90

"China’s Green Shoot of Recovery"

SIME’s FY24 results met our expectation but disappointed the market. Its FY24 core net profit jumped 15% YoY driven by its industrial and automative segments and consolidation of UMW’s earnings. The heavy price discounting drawback in the automotive market in China has started to see a green shoot of recovery. We maintain our forecasts, TP of RM2.90 and OUTPERFORM rating.

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

$SIME / 4197 (SIME DARBY BERHAD)
Research by HLIB
Buy - TP RM3.05

"Headline affected by impairments"

Sime posted 4QFY24 core PATMI of RM367m (-11.8% QoQ; -33.8% YoY) and FY24 at RM1.5bn (+9.8% YoY) – below HLIB’s expectation (94%), but within consensus (105%). We expect Sime to sustain its FY25 performance, driven by its Industrial segment with RM4.25bn orderbook and full FY contribution from UMW, cushioning the deteriorating Motor segment. We maintain our BUY recommendation with a lower TP of RM3.05 (from RM3.28), based on 15% discount to SOP of RM3.58.

Analyst:
Daniel Wong
kkwong@hlib.hongleong.com.my

$SIME / 4197 (SIME DARBY BERHAD)
Research by CGS
Add - TP RM3.28

"Solid industrial division"

■ FY6/24F core net profit came in within our expectations, at 98% of our FY24F forecast vs. 102% of Bloomberg consensus.
■ Industrial division continues to outperform, despite weak contributions from the motor division (especially in China).
■ We expect its industrial division to remain strong, as well as higher contributions from non-China motor, in particular the recently acquired UMW.
■ Reiterate Add, with an unchanged SOP-based TP of RM3.28. This note marks the transfer of coverage to Jacquelyn Yow.

Analyst:
Jacquelyn YOW
E jacquelyn.yow@cgsi.com

$SIME / 4197 (SIME DARBY BERHAD)

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - KUMPULAN WANG PERSARAAN (DIPERBADANKAN)

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - EMPLOYEES PROVIDENT FUND BOARD

$CIMB / 1023 (CIMB GROUP HOLDINGS BERHAD)
$KLSE-CDB
$SIME / 4197 (SIME DARBY BERHAD)

44 Largest Companies in ASEAN 2024 by Fortune 500 Southeast Asia 🇮🇩 🇹🇭 🇲🇾 🇸🇬 🇻🇳 🇵🇭 🇰🇭

Number of Companies: -
Indonesia 🇮🇩 110
Thailand 🇹🇭 107
Malaysia 🇲🇾 89
Singapore 🇸🇬 84
Vietnam 🇻🇳 70
Philippines 🇵🇭 38
Cambodia 🇰🇭 2

Aggregated Revenues (Billion Dollar): -
Singapore 🇸🇬 619.4
Thailand 🇹🇭 375.9
Indonesia 🇮🇩 321.4
Malaysia 🇲🇾 194.9
Vietnam 🇻🇳 144.4
Philippines 🇵🇭 130.9
Cambodia 🇰🇭 1.4

Average Company Profit (Million Dollar): -
Singapore 🇸🇬 527.1
Philippines 🇵🇭 350.0
Indonesia 🇮🇩 250.6
Thailand 🇹🇭 177.9
Cambodia 🇰🇭 163.1
Malaysia 🇲🇾 155.5
Vietnam 🇻🇳 154.4

🇲🇾 Malaysia companies that making on the list including $MAYBANK / 1155 (MALAYAN BANKING BERHAD), $TENAGA / 5347 (TENAGA NASIONAL BHD), $SIME / 4197 (SIME DARBY BERHAD), $PETDAG / 5681 (PETRONAS DAGANGAN BHD), and $CIMB / 1023 (CIMB GROUP HOLDINGS BERHAD).

Company Face-Off: $SIME / 4197 (SIME DARBY BERHAD) vs $BAUTO / 5248 (BERMAZ AUTO BERHAD)

The Malaysian Automotive Association (MAA) has increased its car sales forecast for 2024 by 3.38% following strong sales in the first half. The total industry volume (TIV) is now expected to reach 765,000 units, up from the initial projection of 740,000 units. In this comparison, we take a closer look at two major foreign car retailers that might benefit from strong car sales: $SIME / 4197 (SIME DARBY BERHAD) and $BAUTO / 5248 (BERMAZ AUTO BERHAD).

Which company do you believe is the best among the two? Let us know in the comment section below!

$SIME / 4197 (SIME DARBY BERHAD)

AUTOS
$BAUTO / 5248 (BERMAZ AUTO BERHAD) $SIME / 4197 (SIME DARBY BERHAD)
Research by CGS
Neutral

“BEVs in Malaysia – a cost analysis”

Based on a sample size of 273 vehicles covering all major auto brands in Malaysia (Fig 1), we estimate that hybrid vehicles, such as hybrid electric vehicles (HEV) and plug-in hybrid electric vehicles (PHEV), are on average 14.4% and 22.9%, respectively, cheaper to own/use vs. petrol internal combustion engine (ICE) vehicles. Battery electric vehicles (BEV) are also 11.0% cheaper to own/use despite significant battery replacement costs. In our scenario analyses, where we vary charging costs and annual travel distances, our base case conclusion holds true, except if users travel significantly less distance each year. Our cost analysis employs an equivalent annual annuity (EAA)-to-vehicle price ratio and represents the percentage a buyer will spend on a vehicle each year relative to its initial cost price; this method allows us to account for different vehicle: 1) lifespans, and 2) prices.

Analyst(s):
Jeremy MOK
jeremy.mok@cgsi.com
Prem JEARAJASINGAM
prem.jearajasingam@cgsi.com
Jacquelyn YOW
jacquelyn.yow@cgsi.com

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - EMPLOYEES PROVIDENT FUND BOARD

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - EMPLOYEES PROVIDENT FUND BOARD

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - KUMPULAN WANG PERSARAAN (DIPERBADANKAN)

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - KUMPULAN WANG PERSARAAN (DIPERBADANKAN)

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - EMPLOYEES PROVIDENT FUND BOARD

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - KUMPULAN WANG PERSARAAN (DIPERBADANKAN)

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - AMANAHRAYA TRUSTEES BERHAD - AMANAH SAHAM BUMIPUTERA

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - EMPLOYEES PROVIDENT FUND BOARD

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - EMPLOYEES PROVIDENT FUND BOARD

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - KUMPULAN WANG PERSARAAN (DIPERBADANKAN)