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MBM poised to ride on recovery in auto sector


Solid performance: A teaser image of the new Perodua SUV. Maybank Investment is expecting Perodua to report further sequential earnings growth in the fourth quarter of FY18 from an already solid third quarter.

Solid performance: A teaser image of the new Perodua SUV. Maybank Investment is expecting Perodua to report further sequential earnings growth in the fourth quarter of FY18 from an already solid third quarter.

MBM Resources Bhd may be one of the companies that is best placed to ride on the anticipated upswing in the automotive industry given its exposure as a shareholder of Perusahaan Otomobil Kedua Sdn Bhd (Perodua).

Excitement appears to be returning to the automotive industry as new car models are launched and the Chinese New Year may see demand for new cars rising.

The recent launch of the Proton X70 sport utility vehicle (SUV) has reignited some interest in the industry and the second national carmaker Perodua will also be unveiling its own SUV – the Aruz.

The industry generally took a backseat for last year and the year before as the ride-sharing phenomenon took the limelight following aggressive promotional campaigns. There was also the constant highlight on the efforts to increase rail infrastructure in the country moving forward.

All the concerted efforts also led to a belief that there would not be a necessity to own cars.

It appears that interest could be returning after the consolidation of the ride-sharing industry following the Grab-Uber merger in South-East Asia early last year that had likely reduced competition and the increased government regulations that may give further upward pressure on ride fares.

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