Kuala lumpur: MBSB Investment Bank Bhd is positive on the Capital Market Masterplan (CMP) 2026-2030, saying the blueprint could enhance the vibrancy of Malaysia's capital market.
According to BERNAMA News Agency, the bank stated in a research note that the 2030 targets, which include a market size of RM5.8 trillion to RM6.3 trillion, are ambitious yet achievable. This optimism is grounded in the strong baseline of RM4.3 trillion projected for 2025, which is about 2.1 times the gross domestic product.
However, the bank highlighted that reaching the CMP's upper-bound 2030 scenario of a RM6.3 trillion market size would require whole-of-nation alignment. This includes calibrated tax and investment incentives, continued reforms, pragmatic capital account flexibility, and clear policy signals on sustainability, artificial intelligence (AI), and digitalisation.
The bank emphasized that successful implementation hinges on execution. It noted that disciplined execution could yield significant rewards, such as a market that allocates capital efficiently, broadens participation and retirement security for Malaysians, channels funding to climate transition and resilience, and serves as a gateway for ASEAN and Asia at large.
Furthermore, MBSB views the 'MY Value Up' programme as the CMP's centrepiece for public markets. The initiative places responsibility on boards and management to deliver value creation and introduces clear key performance indicators, such as total shareholder return and return on invested capital (ROIC). It also proposes incentives like a premium index and fee rebates, alongside stricter measures for persistently non-compliant or dormant public listed companies.
The bank noted that the planned early-warning supervision and action-plan windows could prevent chronic value destruction. Overall, it believes 'MY Value Up' could enhance market quality and valuations if aligned with the Malaysian Code on Corporate Governance and improved research coverage for small- and mid-cap companies, ensuring operational progress translates into price discovery.
MBSB also suggested that this could motivate corporates to pursue more efficient balance sheets, including improvements in shareholding metrics such as shares outstanding and share capital.
While optimistic about the CMP's long-term prospects, the bank acknowledged short-term headwinds currently facing markets, mainly due to geopolitical tensions and the conflict involving Iran and US-Israel. It stated that these developments are likely to influence markets until hostilities cease, although the conflict's duration remains uncertain.
Given the prevailing uncertainty, the bank recommended that investors tactically seek shelter in defensive sectors like real estate investment trusts, utilities, healthcare, and consumer staples, which typically provide stable earnings and consistent dividends irrespective of broader market conditions. It also suggested that investors might consider taking a trading view on oil and gas stocks.