KUALA LUMPUR: Bursa Malaysia Bhd's average daily value (ADV) has been sequentially softening, but this will hopefully improve as macros continue to perform well.

Securities ADV may remain slow, according to Kenanga Research, as participation did not increase much.

This, according to the research firm, will take place despite the improved economic performance, a more stable domestic political environment, and reopened Chinese borders.

"That said, the traction from recent initial public offerings (IPOs) could continue to fuel retailers' interest, with Bursa indicating a pipeline of 39 IPOs this year," it said.

Meanwhile, Kenanga Research said Bursa is working on new efforts to drive non-trading revenue such as the launch of the Bursa Gold Dinar and a new debt fund-raising platform with RAM.

The firm said its inaugural carbon credit auction in March 2023 could also serve as a platform for sustainable revenue in the near term.

"For now, our financial year 2023 (FY23) pre-tax profit falls within Butsa's target of RM295−RM326 million," it said.

Kenanga Research said Bursa's reported net profit of RM56.2 million for the first quarter (Q1) FY23 was within expectations

This makes up 25 per cent of Kenanga Research's full-year forecast and 24 per cent of consensus full-year estimates.

"No dividend was declared this quarter, as Bursa typically pays biannually.

"Post-results, our earnings were slightly tweaked from 1QFY23's inputs.

"In terms of ADV, we maintain our FY23 assumption of RM2.2 million with FY24 at RM2.4 million backed by higher participation.

"Maintain market Perform with a target price of RM6.25," it added.

https://www.nst.com.my/business/2023/05/905903/bursa-malaysias-average-daily-value-likely-improve