• Distributive trade sales declined 8.4% yoy
• Retail sales continued contracting but on improving trend
• Declining performance in all three components
• Global retail sales see some recovery in June
• Better retail trade performance to be seen in 3Q20

Malaysia’s distributive trade declined for the third consecutive month in June albeit at a significantly softer pace of -8.4% yoy. All three major components recorded lower fall with motor vehicles chalking the fastest improvement.

Sales of motor vehicles contracted at a far slower pace of -4.5% yoy attributable to the sales tax exemption for cars highlighted in PENJANA stimulus package. Sales of motor vehicles recorded the highest mom increase of RM3.5bn, growing 113.5% to achieve RM6.7bn as sale of motor vehicles parts and accessories registered a sales value of RM2.9bn. Wholesale trade continued contracting but on improving trend of -8.7% yoy. Other specialised wholesale spearheaded the increment to register RM17.3bn with a 35.6% mom growth (Jun: -21.7% yoy; May: -41.8% yoy).

Retail sales decreased RM4.2bn or -9.2% yoy in June, following a 16.2% yoy plunge in the previous month. It was the fourth consecutive decline in retail trade, but the smallest in the current sequence, amid the reopening of almost all economic sectors and business activities. Sales via stalls and markets continued to increase (Jun: +8.9%; May: +4.9%; Apr: +4.3%; Mar: +1.7%) whilst retail trade not in stores, stalls or markets stabled at +9.8% yoy (May: +10.0%; Apr: +3.7%; Mar: +2.4%). Meanwhile, sales growth eased for sale of other goods in specialised stores (Jun: -17.1%; May: - 28.0%; Apr: -56.8%); sale of automotive fuel in specialised stores (Jun: -15.8%; May: -27.2%; Apr: -56.3%); sale of cultural & recreation goods in specialised stores (Jun: - 18.7%; May: -27.8%; Apr: -53.2%) and sale of other household equipment in specialised stores (Jun: -16.5%; May: -25.5%; Apr: -48.3%).

On monthly basis, sales value of Wholesale & Retail Trade grew 21.8% to RM102.9bn in June, contributed mainly by the wholesale trade sub-sector. The wholesale trade sub-sector, which contributed the most to the increase of Malaysia’s sales, rose 20.3% to RM49.0bn, followed by motor vehicle, which soared 78.9% to RM12.1bn, while retail trade increased 13.0% to RM41.8bn.

Source: BIMB Securities Research - 11 Aug 2020