PETALING JAYA: MY Value Up, a programme to improve the valuation of stocks listed on the domestic exchange, may be a catalyst for the re-rating of stock-exchange operator Bursa Malaysia Bhd
, CGS International Research said.
The brokerage, which has maintained an “add” call on the stock with a target price (TP) of RM11.80, said Bursa stands out as the key beneficiary based on a pick and shovel approach.
It said increased disclosure of information such as dividend policy, guidance for financial performance in the recent year/ in the longer term and long-term strategies required under the programme would give investors comfort in putting their money in certain companies, potentially leading to higher trading value of their stocks.
“This is because we expect the MY Value Up programme to raise the overall average daily value (ADV) of the FBM KLCI from 2026 onwards,” it said.
“We believe now is the best time to accumulate Bursa, as we expect Bursa (and the Securities Commission) to disclose the information about the MY Value Up programme in June 2026,” it added.
It is also expecting equity ADV to increase for the financial year ending Dec 31, 2026 (FY26) to FY28.
It has raised FY26 to FY28 net profit forecast growth by 5.8% to 15% and projects double-digit earnings-per-share growth of 16% to 19% in FY26 to FY27 as well as strong expansion in return on equity to 41.8% in FY28 from 29.9% in FY25.
“If the equity ADV exceeds our expectation, every 1% rise in equity ADV would lift our FY26 to FY28 net profit forecasts by 1%.
“The impact on our TP would be similar at 1%,” it pointed out, forecasting equity ADV to increase by 25.1% to RM3.2bil in FY26 and 17.3% to RM3.7bil in FY27.
The research firm noted Bursa’s share price has yet to react positively to the programme as investors could be concerned that tensions in the Middle East would dampen sentiment in the local bourse.
“Ironically, since the outbreak of the war in the Middle East on Feb 28, 2026, the equity ADV remained robust at RM3.1bil to RM3.8bil in March 2026 to May 2026, representing 30% to 54% year-on-year growth in the March to May period.
Equity ADV surged by 53.2% to RM3.15bil in 2024 (excluding off-market transactions, as provided by Bursa Malaysia), partly lifted by inflow of foreign funds but dipped 19.2% last year on foreign fund outflows.
