KUALA LUMPUR: The Malaysian capital market surged 12.6 per cent to RM3.2 trillion in 2017 with strong growth seen across all segments, said the Securities Commission Malaysia (SC). It said the capital market saw double-digit growth across segments with the equity market rising 14.4 per cent to RM1.9 trillion, bond and sukuk was 10.1 per […]
KUALA LUMPUR: The Securities Commission Malaysia (SC) expects total capital raising through primary and secondary markets to be around RM120 billion this year, lower than the record high of RM146.6 billion raised in 2017.
Last year’s figure represents a 48.8% jump from the RM98.5 billion capital raised in 2016.
In its annual report for 2017, the SC said domestic fundraising this year is expected to be driven mainly by capital raising in the corporate bond and sukuk market for infrastructure financing as well as refinancing of bonds and sukuk.
Fundraising through the corporate bond and sukuk market is expected to amount to about RM100 billion while equity fundraising is expected to be about RM20 billion, with RM8 billion to be raised via initial public offerings (IPOs) and RM12 billion via the secondary market.
SC chairman Tan Sri Ranjit Ajit Singh (pix) said 2017 was an exceptional year and the RM120 billion projected for 2018 is much higher than the long-term average of RM114 billion.
“People were anticipating rate hikes so they were positioning things differently. There are companies who deferred capital raising in 2015 and 2016, and moved to 2017. So there are multiple factors. You cannot use an outlier and use that as a new benchmark, it is not an appropriate comparison to make,” he told reporters at a briefing today.
Ranjit said there is a consistent level of capital raising that is occurring through Malaysia’s very well developed capital market, which shows that there is an avenue for businesses to raise a lot of funding.
“Malaysia is very fortunate to be able to develop a financial system that has a strong banking system and a strong capital market, not present in many markets. We have a very deep bond and sukuk market, which allows companies to access the bond and sukuk market to raise the sort of financing that you’ve seen,” he added.
Ranjit said both the equity and bond and sukuk markets still have a very favourable outlook and believes that the capital markets will remain vibrant this year while emerging markets will continue to outpace growth in developed markets.
“We believe the economic and market fundamentals for Malaysia are extremely strong, and given the improvements in corporate earnings, we think the positive sentiments overall will continue. We think 2018 will be a very good year,” he said.
Last year, the capital market grew 12.6% to RM3.2 trillion with total fundraising hitting a record high of RM146.6 billion, above the five-year average of RM114 billion.
Equity market capitalisation grew 14.4% to RM1.9 trillion while bond and sukuk outstanding grew 10.1% to RM1.3 trillion. Islamic capital market increased by 11.9% to RM1.9 trillion, representing close to 60% of the overall capital market.
Of the RM146.6 billion raised last year, RM124.9 billion was raised in the corporate and bond market, RM7.2 billion via 12 IPOs and RM14.5 billion in the secondary equity market.
The fund management industry posted 11.5% growth with assets under management of RM776.2 billion compared with RM696.3 billion in 2016, while the unit trust industry’s net asset value expanded 19.1% to some RM427 billion.
Meanwhile, the SC announced today that it will jointly establish a working group with Bank Negara Malaysia to accelerate digitisation of the stockbroking industry. Named Brokerage Industry Digitisation Group (BRIDGe), it aims to enhance operational efficiencies and service standards.
This year, the SC also aims to license the first digital investment manager and release findings from its ongoing blockchain pilot project.
KUALA LUMPUR (March 15): Oil and gas (O&G) and construction are the sectorial themes for PMB Investment Bhd’s equity investment strategy this year, amid improving prospects underscored by Petroliam Nasional Bhd’s (Petronas) significantly higher earnings last year. The technology sector had been the focus of PMB’s investments last year, its chief executive officer Najmi Mohamed said. At a media conference today, he said the Islamic fund management firm intends to increase its exposure to O&G given Petronas’ encouraging financial performance for the year to end December when it doubled itsRead More
KUALA LUMPUR (March 15): Fundraising total jumped nearly 49% in Malaysia’s capital market to RM146.6 billion in 2017, compared with RM98.5 billion in 2016 against a positive global backdrop. In its Annual Report 2017 released today, the Securities Commission Malaysia (SC) said primary market issuances amounted to RM132.11 billion, while the remaining RM14.5 billion was raised through the secondary market through rights issues and private placements. A total of RM124.9 billion was raised in the corporate bond and sukuk market, while RM7.2 billion was raised via new equity listings withRead More
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