KUALA LUMPUR, July 29 (Bernama) -- Bursa Malaysia rebounded to close higher on Wednesday on selective buying of defensive stocks after a volatile trading session. IPPFA Sdn Bhd director of investment strategy and country economist Mohd Sedek Jantan said consumer products and services stocks lifted the key index higher, overcoming lingering geopolitical concerns. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 3.08 points to 1,715.56 from yesterday’s close of 1,712.48. The benchmark index, which opened 1.91 points higher at 1,714.39, moved between 1,710.79 and 1,720.59 during the day’s trading. In the broader market, gainers outstripped decliners 550 to 476, while 612 counters were unchanged, 1,129 untraded, and 48 suspended. Turnover rose to 2.96 billion units valued at RM2.48 billion from 2.94 billion units valued at RM2.56 billion on Tuesday.
Sector Rating: POSITIVE
MBSB IB maintains a POSITIVE call on the Malaysian property sector, citing improved sentiment, better loan approvals, and a favorable monetary environment following the recent OPR cut by Bank Negara Malaysia (BNM).
Top BUY Picks & Target Prices
| Company | Rating | Target Price | Highlights |
|---|---|---|---|
| Mah Sing Group | BUY | RM1.49 | Focus on affordable housing; rate cut to boost first-time homebuyer demand |
| UOA Development | BUY | RM2.04 | 5.6% dividend yield; expanding into Johor |
| Matrix Concepts | BUY | RM1.65 | MVV City growth driver; ~6% yield; steady Bandar Sri Sendayan contributions |
Key Sector Insights
1. OPR Cut Spurs Affordability & Lending
The OPR cut is expected to improve loan eligibility, reduce interest costs, and reignite buying interest, particularly for mid-range residential units.
Loan approvals rose 5% MoM in May, with a higher approval ratio (46.4% vs. 44.3% in April).
Cumulative approved loans (Jan–May 2025): RM110.9 billion, showing sustained demand.
2. Residential Overhang Still Manageable
Q1 2025 overhang: 23,515 units, driven mainly by Sabah.
Kuala Lumpur overhang declined, while Johor and Perak saw slight increases.
Analysts view this as non-systemic and manageable amid improving fundamentals.
3. Valuation & Market Performance
KL Property Index: +8.4% since May but -6.9% YTD.
Sector trading at 0.66x P/B, aligned with historical average.
MBSB IB narrowed RNAV discounts by ~10%, reflecting better investor sentiment post-OPR cut.
Other Ratings
| Company | Rating | Rationale |
|---|---|---|
| Eco World Development | NEUTRAL | Downgraded due to limited upside post rally |
| S P Setia, Sunway, IOI Properties | NEUTRAL | Valuation revised upward to reflect sector optimism |
Sector Catalysts in 2H25
OPR Cut: Improves loan affordability and boosts housing demand
JS-SEZ & RTS Link: Boost Johor property market and cross-border economic activity
Budget 2026 (Oct): Possible consumption and housing incentives
Investor Takeaway
The combination of improved macroeconomic outlook, resilient loan approvals, and ongoing infrastructure development points to a healthier 2H25 for Malaysian residential property. Developers with strong affordable offerings, regional growth projects, and dividend visibility are poised to outperform.
Watchlist Top Picks: Mah Sing, UOA Development, Matrix Concepts
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