• Manufacturing component down to -0.1% dragged by E&E sub-component (Nov: -6.8%)

• We anticipate a positive outlook for the mining sector in 2024

• Reiterate our forecast for IPI growth, we expect a 1.1% growth in 2023F and a 3.5% growth in 2024F.

OVERVIEW
 

Malaysia's Industrial Production Index (IPI) slightly improved to +0.6% in November. The positive growth was largely driven by higher output from mining (+1.9%) and electricity sector (+4.2%). The expansion of IPI was due to better domestic business activities in November. The YTD average growth for Malaysia's IPI is currently stands at 1.0%.

Manufacturing. The manufacturing component experienced a negative growth in November. Manufacturing segment edged down or by -0.1% in November compared to +0.9% in October as output was mainly dragged by subdued performance from E&E sector which decreased by -6.8% on the back of gloomy global demand and geopolitical issues.

Mining: In November, the mining sector experienced an increase in production, grew by +1.9% YoY compared to +7.4% increase in October. The better production can be attributed to higher output from both natural gas and petroleum oils & condensate.

Electricity: Electricity component delivered another positive growth of 4.2% in November, compared to 5.6% in October.

Source: BIMB Securities Research - 12 Jan 2024