KUALA LUMPUR: CIMB Securities Sdn Bhd anticipates that AMMB Holdings Bhd
(AmBank) may replace Hong Leong Financial Group Bhd (HLFG) in the FTSE Bursa Malaysia KLCI (FBM KLCI) Index, following an upcoming KLCI semi-annual review.
In a note, CIMB Securities said the review is based on share prices at the close of trading on May 26, 2025.
FTSE and Bursa Malaysia will announce the preliminary results of the KLCI review on June 4 2025, a day ahead of the official release of the final review on June 5. Any changes to the index constituents will take effect on June 23, 2025, the note said.
CIMB Securities said HLFG is likely to fail the liquidity screening requirement, which mandates a monthly median trading velocity of at least 0.04 per cent in eight out of the past 12 months. HLFG is one month short of the required eight months.
"To remain in the KLCI during the semi-annual review, existing constituents must satisfy all three criteria.
"First, in the market capitalisation ranking. Secondly, a minimum free float of 15 per cent and third, the liquidity screening,” the note said.
The liquidity screen assesses the median daily trading volume as a percentage of shares in issue over a 12-month review period.
A stock must maintain a monthly median daily trading volume of at least 0.04 per cent of its shares in issue, after applying any investability weightings, in at least eight out of the past 12 months.
HLFG’s weighting in the KLCI stood at 0.7 per cent as at Dec 31, 2024.
CIMB Security said if an existing FBM KLCI constituent is removed from the index, it will be replaced by the highest-ranking non-constituent company based on market capitalisation.
"As of May 26, AmBank holds this position. Our checks also confirm that AmBank meets the other two inclusion criteria: it has a minimum free float of at least 15 per cent and has satisfied the liquidity requirement, with a monthly median trading velocity of at least 0.05 per cent in the past 12 months (Jun 2024-May 2025),” it added. - Bernama
