CEO Swift said he expects more IPOs in 2024, with a target of 42 listings this year.
KUALA LUMPUR: Bursa Malaysia Bhd
has a positive outlook for 2024, as it expects the local equity market to perform better on the back of stronger economic growth forecast for this year.
Its chairman, Tan Sri Abdul Wahid Omar, said this is expected to pave the way for higher corporate earnings and an increase in fund-raising activities.
“The stock market performance for the first 30 days of 2024 has improved with an average daily value (ADV) of RM3.2bil and foreign investment flows of RM512mil,” he told reporters during the Bursa Malaysia 2023 Financial Results briefing here yesterday.
He added the local bourse would remain committed to improving market liquidity and vibrancy to ensure the country remains an appealing investment destination.
His positive outlook stemmed from Bursa Malaysia’s better financial results in 2023 compared to 2022.
Bursa Malaysia recorded a profit after taxation and minority interest (Patami) of RM252.4mil for the financial year ended Dec 31, 2023 (FY23), an 11.4% increase from the RM226.6mil reported in FY22.
Abdul Wahid said the growth was attributed to a higher operating revenue of RM592.8mil for FY23, a 1.3% increase from the RM585.3mil registered in FY22.
According to him, the stock exchange’s performance was commendable despite 2023 being marked by global challenges including geopolitical concerns, monetary tightening and slower growth from the larger economies.
“Malaysia’s economy, in particular, remained resilient in 2023 with a projected gross domestic product (GDP) growth rate of close to 4%,” he said.
Total operating expenses saw a 0.6% marginal increase to RM294.5mil from RM292.7mil in FY22 which was mainly due to higher headcounts for new business and capacity building, enhancement of cybersecurity and higher depreciation from IT and non-IT assets.
The Securities Market registered trading revenue of RM266.6mil in FY23 compared to RM263.5mil in FY22, an increase of 1.2%, due to ADV traded for On-Market Trades and Direct Business Trades.
For the Derivatives Market, trading revenue fell by 7.8% to RM89.6mil from RM97.2mil in FY22, mainly due to lower collateral management fees earned, and fewer crude palm oil (FCPO) futures contracts traded in FY23.
However, conference fees and exhibition related income increased significantly to RM7.3mil from RM2.1mil in FY22, driven by a substantial rise in the number of participants at the Palm and Lauric Oils Price Outlook Conference & Exhibition.
As for the Islamic Market, Bursa Suq Al-Sila’ (BSAS) trading revenue grew by 3.9% to RM17.1mil in FY23, up from RM16.4mil in FY22.
Non-trading revenue from data business recorded a notable rise to RM68mil in FY23, as compared to RM60.8mil in FY22, underpinned by the higher Securities and Derivatives market data revenue.
This was as a result of the revision in fees at the beginning of the second quarter of 2023 and a higher number of subscribers in FY23.
The board declared a final dividend of 14 sen per share, amounting to about RM113.3mil which will be payable on Feb 29, 2024.
He said this was in addition to the interim dividend of 15 sen per share that was paid in August last year, bringing the total dividend to 29 sen per share, representing a payout ratio of 93.0% for FY23.
Meanwhile, Bursa Malaysia’s chief executive officer Datuk Muhamad Umar Swift said the local bourse hit 32 out of its target of 39 initial public listings (IPO) for 2023.
Seven were listed on the Main Market, 24 on the ACE Market and the remaining one on the LEAP Market.
“We fell below our targets primarily due to ongoing global macroeconomic uncertainties and unfavourable market conditions, which led companies to delay their listing applications. Companies were also accessing the LEAP Market Transfer Framework before making decisions on their applications,” he said.
Swift said they expect the IPO performance to improve in 2024, with a target of 42 listings this year.
He also said Bursa Malaysia successfully launched two products, Bursa Gold Dinar and the commercialisation of new debt fundraising solutions for small and medium-sized enterprises.
“BR Capital, has been established to assist small to mid-sized companies in their fundraising efforts, by providing them with new avenues for capital beyond the traditional wholesale markets,” he said.
Swift said that as a Multi-Asset Exchange, the local bourse is focused on diversifying fundraising and trading opportunities for valued stakeholders.
“This includes the recently launched Bursa Gold Dinar, MyBURSA portal and BURSA REACH, all aimed at enhancing investor access and experience,” he said.
Swift added Bursa Malaysia’s commitment to invigorate the Malaysian derivatives market was exemplified through the introduction of the currency futures contract, Mini USD/CNH Currency Futures and the Futures Trading Apprenticeship Programme.
He noted on the environmental, social and governance (ESG) front, Bursa Malaysia will continue to deliver products and services in line with that.
“This will include the launch of the ESG Reporting Platform to aid public listed companies in fulfilling their ESG reporting requirements, and the launch of the Centralised Sustainability Intelligence, to facilitate both listed and unlisted companies in assessing their carbon
emissions impact and ESG data reporting in accordance with global standards,” Swift added.
