Johari: MidS scheme to enhance mid, small cap stocks

  • Business
  • Friday, 26 May 2017

KUALA LUMPUR: The newly-launched Mid and Small Cap (MidS) Research Scheme would provide visibility and enhance tradability of under research stocks.

Second Finance Minister Datuk Seri Johari Abdul Ghani said the objective of the scheme was multi-pronged and could indirectly help listed companies gain better access to raise funds, as well as, increase merger and acquisition activities crucial in ensuring the local stock market remained vibrant and attractive.

“Retail investors must seize this opportunity to learn from research reports to make responsible and informed investing decisions,” he said after launching the scheme here yesterday.

The scheme which was tabled in Budget 2017 by Prime Minister Datuk Seri Najib Tun Razak, led to the setting up of a task force headed by the Securities Commission Malaysia (SC) to oversee the operationalisation of the scheme.

Johari said for a start, 100 listed companies, selected based on a series of quantitative and qualitative criteria, would receive independent analysts by licensed research houses in the first year, with more companies to be featured in the second year. “We believe that the mid and small cap universe have interesting business models and exciting prospects that can be the impetus for improved valuations for this segment,” he said.

Johari said government-linked investment companies (GLIC) would also allocate RM3bil to be invested in potential mid and small cap listed companies to enhance the liquidity and interest for these stocks.

“These allocations may be outsourced partly or wholly to licenced external fund managers,” he added.

SC chairman Datuk Seri Ranjit Ajit Singh said the scheme was aimed at facilitating the medium and small cap segment in optimising the segment”s potential through the issuance of high-quality and publicly independent research reports. – Bernama


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