KUALA LUMPUR, Dec 5 (Bernama) -- Bursa Malaysia closed lower on Friday amid mixed regional market performance as investors turned cautious over a possible rate hike by the Bank of Japan (BOJ) and upcoming US economic data that may influence the Federal Reserve’s (Fed) interest rate decision next week. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) pared most earlier losses to settle 4.55 points easier, or 0.28 per cent, to 1,616.52 from Thursday’s close of 1,621.07. The benchmark index, which opened 0.37 of-a-point lower at 1,620.70, moved between 1,609.67 and 1,621.25 throughout the day. The broader market was negative, with decliners outpacing advancers 604 to 439. A total of 550 counters were unchanged, 1,151 untraded, and 18 suspended. Turnover declined to 3.17 billion units worth RM2.24 billion from 4.48 billion units worth RM2.75 billion yesterday. Rakuten Trade Sdn Bhd vice-presiden...
Earnings Miss
1HFY2025 Core Net Profit: RM7.1m
After adjustments (NRV write-down + onerous provision of RM22m).
Only 29% of full-year forecast achieved, well below expectations.
Key Issue: Earnings miss reflects weaker ASPs and thinner margins.
Analyst Downgrades
BIMB Securities Research:
Cut rating from Neutral to Sell.
Slashed earnings forecasts:
FY2025: -48%
FY2026: -68%
FY2027: -72%
Cited Thai sugar dumping risk after China banned liquid sugar imports, putting pressure on ASPs.
MBSB Research:
Downgraded from Neutral to Sell.
Expects recovery delayed to FY2026 instead of FY2025.
Pegged lower TP of RM0.71 (vs current price RM0.98).
Warned of price war among AP players with excess inventory.
Market Reaction
Shares fell 1.5% to RM0.98 (Aug 26).
YTD performance: -19%.
MSM is one of only two refiners in Malaysia (the other is unlisted Central Sugars Refinery under Syed Mokhtar).
Sector & Macro Headwinds
Supply glut: Abundant production from top 3 global sugar exporters driving down NY11 prices.
FX risks: Volatility adds pressure to import-heavy refiners.
China factor: Ban on liquid sugar imports diverts Thai supply into Malaysia and regional markets.
Margins squeezed: Industrial & export segments face narrowing ASP premium.
Investor Takeaways
Structural challenges: MSM’s recovery story is undermined by global oversupply, Thai dumping risk, and currency volatility.
Valuation pressure: With earnings forecast cuts up to 72% by FY2027, the downgrade cycle may weigh further on share price.
Dividend outlook: Payout sustainability in question if earnings continue to underperform.
Long-term play? Turnaround may hinge on regulatory intervention (anti-dumping measures, pricing framework) or demand recovery.
Conclusion: MSM’s short-to-medium term outlook is bearish. Investors should treat it as a high-risk turnaround bet with significant downside until sector dynamics stabilize.
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