CEO Morning Brief

Berjaya Mutual Targets RM5 Bil AUM by 2026

edgeinvest
Publish date: Tue, 28 May 2024, 10:40 AM
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TheEdge CEO Morning Brief
(From left) Berjaya Mutual chief investment officer Datuk Nazri Khan, Berjaya Corp founder and adviser Tan Sri Vincent Tan, Berjaya Mutual chairperson Tunku Tun Aminah, Berjaya Mutual executive director Lukman Musa and Berjaya Mutual CEO Eugene Chew. (Photo by Patrick Goh/The Edge)

KUALA LUMPUR (May 27): Berjaya Mutual Sdn Bhd, formerly known as Inter-Pacific Asset Management Sdn Bhd, has set a target to grow its asset under management (AUM) to RM5 billion by 2026 from RM1.2 billion currently.

To achieve the ambitious target, the asset management company said it is targeting to launch five products this year, as it aims to attract more retail investors to the fund.

Its chief executive officer Eugene Chew Boon Chye said the company plans to gather RM100 million in new AUM annually from its three existing products, which comprise a mix of fixed-income securities, US equity and money market instruments.

Additionally, he said the fund aims to increase its AUM by RM200 million annually from the five upcoming products, which involve investments in foreign equity and fixed-income securities, targeting a net return of 6% to 8% per annum.

Over the last four years, the fund has seen its AUM quadruple to RM1.2 billion from RM324 million in 2020.

Speaking at a press conference at the launch of Berjaya Mutual on Monday, Chye said the company aims to penetrate the underserved and unserved market within the retail segment by lowering the entry barrier and allowing a minimum investment of RM50,000.

"Typically, if you were to engage a fund manager to manage your monies via private mandate structure, you have to put in at least RM250,000. However, we offer an opportunity for individuals to start with just RM50,000,” he said.

Berjaya Mutual said the rebranding of the company from Inter-Pacific Asset Management was made to leverage the Berjaya Group brand, project a more modern image and reinforce its mission to offer investment products for the underserved and unserved Malaysians.

Berjaya Mutual is a 71%-subsidiary of Berjaya Group.

About 90% of Berjaya Mutual's AUM is invested in overseas capital markets, mainly in the US, with the company's chief investment officer Datuk Nazri Khan noting that the US is expected to be the main key market for the fund as its main focus area is a “momentum investment”.

“Currently, we focus on megatrends with momentum stocks such as artificial intelligence (AI), blockchain, fintech and robotics stocks. We plan to gather with moderately-leveraged ETFs (exchange-traded funds), inverse ETFs, income-generated option-based ETFs, and non-equity asset plus ETF,” he said.

“There are three types of investors. The first one is value investors whereby they look for undervalued companies, the second is investors who look for growth and then there are investors who look at the sweet spot whereby we look into momentum.

“Presently, most of our investments are in the US market, which is still in its early stage of a bull market. So we want to ride on that momentum,” Nazri told The Edge after the launch.

He also highlighted the potential of retail investors in the market. According to the group, the fund currently consists of 30% retail investors and 70% institutional investors.

Nazri said the group is also targeting the younger generation by launching a digital portal which aims to provide a convenient and seamless connection and communication between both investors and Berjaya Mutual.

He said the fund aims to increase its retail investor segment to 50%, with 20% to 30% of that comprising the Gen Z crowd.

Meanwhile, when asked about the six-month suspension of his capital markets services representative’s licence (CMSRL) by the Securities Commission Malaysia in late 2022, Nazri said it was due to compliance-related matters, adding that it had been a “humbling experience” for him.

“This is actually a catalyst for us to grow stronger. In fact, we learn that communication with investors is the highest priority. It is very important for us to be transparent with our investors moving forward,” said Nazri.

The CMSRL licence is granted to a representative to allow the person to carry out any one or more regulated activities on behalf of the principal.

Besides the suspension of the licence — which was lifted in June 2023 — Nazri was also fined RM577,500 for misleading remarks and advertising, according to the SC's website.

Source: TheEdge - 28 May 2024

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