2021-12-02-Credit_Suisse-马来西亚_2022年前景谨慎乐观_92页_2mb

Malaysia Market Strategy Outlook 2022: Cautiously Optimistic

We maintain a cautious optimistic outlook for the Malaysian market in 2022, highlighting opportunities deriving from economic reopening, domestic consumption growth, supply chain disruptions, and digital economy expansion. Despite recent performance challenges, valuations appear attractively discounted relative to historical averages and the broader Asia-Pacific region.

Key Economic & Market Drivers

• GDP Growth: Projected at 6.1% for 2022, driven primarily by private consumption (nearly 60% of GDP).
• Corporate Profits: Market net profit growth slowed to 10% (vs. 56% in 2021) due to the one-off prosperity tax, though the average across ASEAN (AxJ) was just 9%.
• Valuations: The Bursa Malaysia index (KLCI) trades at an average P/E of 14.4x, approaching its lowest level since pre-crisis GFC days (1.4x P/B, historically). Often among the cheapest in Asia-Pacific despite being among the worst performers in ASEAN.

Top Investment Themes

1. Shift to Endemic COVID: Economic reopening, growth in tourism & private consumption sectors. Key beneficiaries: Tourism (Malaysia Airlines, Genting), Retail (Mr DIY).
2. Self-Help Initiatives: Corporate restructuring, asset monetization, financial deleveraging (CIMB, Maybank, TM). Focus areas: Financials, Utilities, Tourism, Tech.
3. Supply Chain Disruptions: Advantage for certain sectors (Plantations/Gloves - CPO prices supported by shortages). Benefit for Technology supply chain players.
4. Rapid Growth in Digital Economy: Massive surge in digital adoption, e-commerce (Google projects RM35bn internet economy by 2025). Beneficiaries: Banks, Telecoms (Maxis, Telekom), Digital platforms (CTOS).
5. Growing Focus on ESG: Creating valuation divergence (sectors like Plantation, Gloves de-rated due to scrutiny).

Top Picks & Valuation Considerations

• KLCI Target: 1730 (16% upside).
• Preferred Sectors/Stocks:
  • Economic Reopening: CIMB, IHH, SP Setia, Sime Darby (EV), Sime Plant.
  • Undervalued: CIMB (low P/B), Maybank (discounted valuation).
  • Supply Chain: Pentamaster (auto-tech), Yinson (FPSO services).
  • Digital/Consumption: CTOS (digital solutions), Maxis/Telekom (telecoms infrastructure/broadband).
  • Property: SP Setia (selective exposure), Sime Property (logistics/industrial developments). Hotels (GENM) poised for recovery.
• Key Discount Factors: Post-COVID performance, ESG concerns (primarily Plantation, Glove sectors), EPF outflows in early 2021 (though to a lesser extent now).

Key Risks

• Politics: Uncertainty surrounding general election timing in late 2022.
• COVID-19: Potential resurgence impacting mobility and reopening plans, especially in upcoming state elections.
• Global Inflation/Policy: Upward pressure on interest rates in the US/global could impact sentiment, currency, and valuations.

Sector Specific Notes

• Banks: Projected 10% net profit growth, aided by credit cost improvement and potential rate hikes. (CIMB, RHB, Maybank, Public).
• Credit Reporting: Rapid growth ahead, technology enabler (CTOS).
• Construction: Largest near-term growth sector (11.5%); PPP opportunities (Gamuda, IJM).
• Tourism: Overall outlook cautious, but key property players (GENM) have positive catalysts.
• Power: Significant carbon transition risk (Tenaga).
• Rubber Gloves: Market stabilizing but below trend; larger TPP threat than previously expected.
• Property: Strong pent-up demand, but still face supply imbalances; execution and affordability key.
• Consumer: Recovery expected, but cautious on margins due to input cost pressures.
• Plantation: Valuations remain attractive despite ESG concerns; sensitive to CPO prices.

Disclaimer: This summary reflects a cautious optimistic outlook based on the provided report dated 3 December 2021. Market conditions can change rapidly.