PNB remains optimistic about Malaysia’s economy and bourse next year

KUALA LUMPUR: Permodalan Nasional Bhd (PNB) remains optimistic about the outlook for Malaysia’s economy and local bourse next year, underpinned, among others, by clear economic policies and steady inflows of foreign direct investments (FDI).

President and group chief executive Datuk Abdul Rahman Ahmad said policies such as the National Energy Transition Roadmap and the National Semiconductor Strategy have been well received, bolstering investor confidence.

He also noted that the country is currently experiencing a third wave of investment upcycle, which was contributed greatly by FDI inflow.

“The combination of well-received economic policies, strong FDI inflows driven by electrical and electronics sector data centres, and robust domestic direct investments indicates real activity on the ground. This positive trend reflects the close relationship between the economy and the stock market. I believe that the momentum we have in 2024 will continue in 2025,“ he said during an editors’ briefing at Menara 118 today.

Currently, 77% of PNB’s assets are invested domestically, with 60% of that allocation in the public equity market, mainly in the FTSE Bursa Malaysia Kuala Lumpur Composite Index (FBM KLCI), Abdul Rahman said.

“One potential risk is that while the Malaysian economy performs well, this has not yet translated into better earnings or performance for corporate Malaysia,” he added when asked about concerns that can derail the projection next year.

When asked about potential merger and acquisition (M&A) activities following the Sime Darby-UMW Holdings Bhd deal, Abdul Rahman emphasised that PNB’s priority is ensuring Sapura Energy Bhd completes its debt restructuring.

“Sapura Energy’s debt restructuring scheme has been extended to March 2025, and completing this process is vital for stabilising its operations,” he said, adding that PNB is not currently pursuing M&A activities in the oil and gas sector.

On Velesto Energy Bhd, where PNB holds a 54% stake, Abdul Rahman declined to comment further, noting that discussions regarding potential divestment are ongoing.

On June 6 this year, it was reported that Sapura Energy was granted a nine-month extension by the High Court to the convening and restraining orders that the group obtained from the court in March 2024, allowing it to continue restructuring its debts. The new orders are effective from June 11, 2024, to March 10, 2025.

PNB stated it remains focused on reviewing its portfolio performance, taking a bottom-up approach to identify companies with strong organic growth potential. – Bernama