Bursa Malaysia's performance reflects a revaluation aligned with regional benchmarks following a robust performance in the second quarter of the Calendar Year (CY2024), as cited by Kenanga Investment Bank (Kenanga) in their report today (July 15, Monday).
Kenanga gave Bursa Malaysia a MARKET PERFORM rating and raised its target price based on stronger-than-expected average daily value (ADV) metrics in 2QCY24, reaching RM3.61 billion, up by 23% quarter-on-quarter and 103% year-on-year, to an increased target price (TP) of RM9.90, up by 48%. This surge was bolstered by increased interest in large-cap stocks, supported by favourable investment themes and economic developments in Johor.
The bank forecasts Bursa Malaysia's upcoming core earnings for 2nd Quarter Fiscal Year 2024 (2QFY24) to potentially range between RM80 million and RM85 million, marking an 11% quarter-on-quarter increase and a robust 70% year-on-year growth, driven by heightened ADV performance and market sentiment.
In addition to the TP upgrade, Kenanga adjusted its forward price-to-earnings ratio (PER) for FY25F to 25x, aligning it with global financial exchange peers amidst heightened trading activities. The revision underscores positive sentiment and potential upside in Bursa Malaysia shares amid a favourable market cycle and lean cost structure advantageous in a market upswing.
