PETALING JAYA: RHB Research has lifted its total industry volume (TIV) forecast for 2025 after the earnings of automotive companies for the third quarter ended September (3Q25) were deemed “overall in-line” with expectations.
In a report, the research house said it had upgraded its 2025 TIV forecast to 795,000 units from 730,000 units, implying a 3% year-on-year (y-o-y) decline, on the back of supportive macroeconomic trends and seasonally stronger 4Q25 numbers.
“This is in line with the year-to-date 2025 TIV of 727,800 units (-1% y-o-y), which is at 92% of our 2025 forecast,” it said.
On the performance of selected companies, RHB Research said Sime Darby Bhd
’s core profit of RM335mil (-8% y-o-y) came largely within expectations.
It said this was primarily driven by a surprise turnaround in the China motor segment, which was partially offset by a weaker-than-expected performance from the industrial business.
“Sime Darby’s motor segment returned to the black with RM126mil in core profit before interest (PBIT), led by China – thanks to the special rebates received, narrowing discounts and stronger sales.
“The industrial segment’s PBIT margin eased to 6.6% due to delayed new equipment deliveries in Australia and (likely) lower after-sales contributions, which typically have higher margins.”
The research house noted that Sime Darby expects quarter-on-quarter sales improvement and a slight margin uptick ahead, supported by higher average selling prices and lower inventory costs.
“As such, we anticipate the company to book stable earnings for the 4Q25, further underpinned by robust Perodua sales, while the China motor division may remain volatile given the intensifying competition in that market.”
Separately, RHB Research noted that Tan Chong Motor Holdings Bhd (TCM) recorded another loss-making quarter, mainly due to weak sales volume and high fixed costs.
This will likely continue as management has yet to outline a clear strategy to address declining sales and mounting losses.
“That said, we reiterate our ‘buy’ call, based on the intrinsic value of its underlying assets, although the time of realisation is uncertain at this juncture.”
The research house said it is positive on TCM’s recent letter of intent with Perodua to rent out some of its assembly lines for the latter’s electric vehicle project, as this may help the group better manage its fixed costs by optimising existing plant capacity.
Meanwhile, for MBM Resources Bhd, RHB Research said the positive deviation mainly came from higher-than-expected Perodua sales volumes and contributions from associates.
“This brought core earnings for the nine months of 2025 (ended September) to RM233mil. Management guided that Perodua’s backlogs remained resilient at 89,000 (from 90,000 in the previous quarter) and we have also lifted our sales volume assumptions for this marque accordingly.”
Overall, RHB Research is keeping its “neutral” outlook for the automotive sector.
“Key downside risks to our sector recommendation include softer-than-expected orders and deliveries, price hikes on completely-knocked-down cars post the open market value duty revision, and intense price competition.
“The opposite represents the upside risks,” it said.
