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Friday, December 16, 2011

Navigating Malaysia – A challenging year ahead.

Investors need to tread carefully in 2012 which could be a very tough and volatile year for the stockmarket. Besides having to contend with a slowing economy, investors will very likely have to brace for the impact of the 13th general elections, amid a multitude of risks. We downgrade Malaysia from Overweight to Neutral and reduce our end-2012 KLCI target from 1,570pts to 1,520pts due to earnings cuts in the Nov results season. Our target basis remains 12.6x P/E, a 10% discount to the 3-year moving average P/E.

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