CEO Morning Brief

Bursa Small-cap Index Near Ten-year High Amid Tech Upcycle, Notches RM40b Year-to-date Gains

Publish date: Tue, 11 Jun 2024, 10:31 AM
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TheEdge CEO Morning Brief

KUALA LUMPUR (June 10): Bursa Malaysia’s FBM Small Cap Index neared a ten-year high on Friday (June 7) amid the widely-anticipated global technology upcycle, with small-cap counters gaining nearly RM40 billion in market value since the start of the year.

The FBM Small Cap Index — which includes the top 98% of companies listed on Bursa Malaysia excluding the top 100 — rose 1.21% to hit 19,315.16 points at Friday’s market close, last breached on August 19, 2014.

It outperformed the FBM KLCI by gaining 18.1% year to date and 28.8% over the past year. In comparison, FBM KLCI notched relatively lower 11.2% year-to-date gains while growing 17.35% over the past twelve months.

Notably, companies valued between RM100 million and RM5 billion in the FBM Small Cap Index have racked up nearly RM40 billion in market capitalisation, according to data compiled by The Edge. The top movers were mainly dominated by technology, construction, as well as industrial products and services companies.

Among companies valued between RM500 million and RM1 billion in the FBM Small Cap Index, electronics manufacturing services (EMS) firm Notion VTec Bhd (KL:NOTION) stood out as the frontrunner, skyrocketing 353.1% year to date. Following behind is information technology (IT) services provider MMAG Holdings Bhd (KL:MMAG), which recorded a 215.8% gain.

Meanwhile, cable manufacturer Southern Cable Group Bhd (KL:SCGBHD) rose 111.9% amid rising demand for renewable energy (RE), while solar photovoltaic (PV) supplier Pekat Group Bhd (KL:PEKAT) also gained 102.3%.

As for companies with a market value of between RM1 billion and RM5 billion on the FBM Small Cap Index, construction outfit Southern Score Builders Bhd (KL:SSB8) rose as the top performer, soaring an impressive 214% year to date.

In its wake is Chin Hin Group Property Bhd (KL:CHGP), which recorded a remarkable 213.8% increase year to date.

Notably, three out of the five top gainers in this category are technology-related companies, with hard disk drive (HDD) mechanical components manufacturer JCY International Bhd (KL:JCY) leading the pack, surging as much as 190.9%.

This is followed closely by VSTecs Bhd (KL:VSTECS) with an increase of 190.2%, and SNS Network Technology Bhd (KL:SNS) with an increase of 176.6%.

To recap, VSTECS made headlines in January after it was named an authorised distributor for SpaceX’s Starlink high-speed internet. Meanwhile, SNS was recently appointed by VSTECS as the authorised retailer for Starlink’s equipment.

As for companies valued between RM100 million and RM500 million, Sabah-based property developer WMG Holdings Bhd (KL:WMG) was the top mover, increasing as much as 320% year to date.

It is closely followed by resort operator Pan Malaysia Holdings (KL:PMHLDG) with a 300% gain, and structural steel specialist Eversendai Corp Bhd (KL:SENDAI) with a 272.7% surge.

Source: TheEdge - 11 Jun 2024

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