MUAR: The newly set-up ValueCap Sdn Bhd looks set to keep the Kuala Lumpur Composite Index (KLCI) on its upward trend from now on, said Deputy Finance Minister Datuk Chan Kong Choy.
He said the RM10bil fund management firm, equally owned by Khazanah Nasional Bhd, Permodalan Nasional Bhd and Kumpulan Wang Amanah Pencen, planned to bring out the true share value of companies on the stock market.
He said the market had not been reflecting the true value of many companies in the last two years, although they were fundamentally strong.
“We have companies making over RM1bil annually, but their shares in the stock market continue to remain low and many are even undervalued.
“The low value of their shares was caused by external factors, not because the companies are weak,” he said after attending a singing performance at the Sing Ming temple in Sungai Senduk near here.
Chan said ValueCap, which was managed by experts and specialists in the related field, would be professional in all its dealings and would go for the undervalued companies with strong fundamentals.
He said there were many such companies and the fund management had many good shares to buy, adding that ValueCap would not have any direct dealings with shareholders of any company before buying.
To a question that ValueCap’s role in the stock market could trigger a buying spree, especially of blue chip counters, among foreign fund managers, Chan said the aim was to reflect the true value and strength of Malaysia’s share market.
He said over the past 60 months, Malaysia, with reserves of RM130bil, had enjoyed a continuous export surplus, especially in the electronic sector, and high commodity prices.
However, these factors had failed to reflect the true strength of the nation’s economy and the Kuala Lumpur Stock Exchange continued to remain low because Malaysians tend be guided by the Dow Jones.
“The Dow Jones has nothing to do with the KLSE or our economic strength and should not be an indicator for Malaysians to buy shares.
“The drop in the Dow Jones was due to the Sept 11 attacks and business scandals in the United States, and it should not have any influence on our stock market,” he added.
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