Latest news with #BIMB
The Star
10-07-2025
- Automotive
- The Star
BIMB Securities remains 'neutral' on EV adoption outlook
PETALING JAYA: The future of the electric vehicles (EV) market in the country looks promising as structural incentives and increasing ESG awareness provide a supportive backdrop for long-term electrification. But underinvestment in distribution infrastructure presents a structural bottleneck, said BIMB Securities Research. The absence of proactive upgrades in substations and feeder lines, particularly in high-density urban and legacy residential areas, continue to constrain home-charging scalability. Until grid resilience improves materially, EV uptake may remain biased towards landed homes or public charging networks, delaying broader adoption. In this context, BIMB said, it sees selective upside for contractors exposed to grid enhancement projects and power distribution assets, while turning cautious on EV original equipment manufacturers and charging infrastructure players with concentrated exposure to the residential segment. It retains its 'neutral' stance on both the automotive sector and Malaysia's EV adoption outlook. Within its coverage, it maintains 'hold' calls for Sime Darby Bhd and MBM Resources Bhd , while reiterating its 'sell' call on Bermaz Auto Bhd . Its target price for the three stocks are RM1.76, RM4.30 and 65 sen a share respectively. Despite offering EV models across the board, it continues to favour Sime Darby for its balanced exposure, anchored by strong EV traction from BYD and BMW, and resilient Internal Combustion Engine volumes via Perodua. This diversified product mix enables Sime Darby to ride both ends of the adoption curve, supporting earnings stability as the market transitions. In contrast, Bermaz Auto's narrower model range and higher premium bias limit its relative defensiveness in a more price-sensitive and infrastructure-constrained EV landscape. To ensure that EV adoption can scale sustainably, Malaysia must undertake several key actions, said BIMB. First, a comprehensive mapping and stress-testing exercise should be conducted to identify weak substations and prioritise them for upgrades. Secondly, it suggested, public-private funding mechanisms should be mobilised, particularly involving government-linked companies and institutional investors, to finance grid modernisation efforts. Thirdly, the development of a domestic battery recycling industry should be incentivised to manage end-of-life battery waste and enable second-life usage. Finally, the adoption of smart load management technologies should be encouraged, particularly for home and commercial EV chargers. These systems can balance power draw across time and location, reducing peak stress on the grid. It adds that Malaysia's current electricity generation capacity stands at 27,288MW, and is projected to rise to 40,000MW by 2029. However, generation is not the primary bottleneck, the real pressure point lies in the distribution segment. Substations and feeder lines, particularly in mature urban areas, are not equipped to support EV charging loads ranging from 11–20kW per household. The issue becomes more acute when multiple households charge their vehicles concurrently, resulting in localised demand spikes that risk overloading transformers and causing power disruptions.
New Straits Times
30-05-2025
- Business
- New Straits Times
Bank Islam Q1 earnings down on higher provisions, but non-fund income jumps 50pct
KUALA LUMPUR: Bank Islam Malaysia Bhd's (BIMB) net profit dropped 3.4 per cent to RM126.27 million in the first quarter ended March 31, 2025 (1Q25) from RM130.73 million a year ago. The lower earnings were mainly due to higher net allowance for impairment on financing and higher total overheads, mitigated by higher net income, the bank said in a filing to Bursa Malaysia today. However, revenue for the quarter rose to RM1.23 billion, down 7.89 per cent from RM1.14 billion previously. Earnings per share stood at 5.57 sen, down 0.2 sen from 5.77 sen in 1Q24. BIMB registered a net income of RM673.5 million in 1Q25, a nine per cent increase from a year earlier, primarily driven by a 50.3 per cent surge in non-fund-based income at RM133.6 million. Other contributing factors included increased foreign exchange transactions income and net gains from the sale of investment securities. BIMB's net allowance for impairment on financing and advances rose by RM37.5 million to RM79.8 million in the quarter, primarily due to an increase in net new impaired financing. The bank's total assets stood at RM98.3 billion, up eight per cent year on year, spurred by increased investment securities and financing. Gross financing grew six per cent to RM71.8 billion, driven by a 6.5 per cent increase in consumer financing and a 10.4 per cent rise in commercial financing. Customer deposits and investment accounts rose 5.5 per cent to RM80.6 billion. As of March 2025, the bank's current, savings and transactional investment accounts stood at RM30 billion, representing a healthy composition of 37.2 per cent. Total capital ratio remained robust at 18.7 per cent. Commenting on the financial performance, group chief executive officer Datuk Mohd Muazzam Mohamed said the bank delivered a modest first quarter performance, driven by strategic growth and a commitment to sustainability. "As a forward-looking, Shariah-compliant financial institution, we continue to evolve with customer expectations while leveraging technological advancements in Islamic finance. "Our continued focus on responsible banking and long-term sustainable growth reinforces Bank Islam's leadership in shaping a more inclusive, resilient, and future ready financial ecosystem," he said in a separate statement. On prospects, BIMB said its business growth strategies for 2025 prioritise the expansion of wealth management, Ar-Rahnu and bureau-de-change services, while fortifying collaboration with its subsidiaries, namely, BIMB Investment Management Bhd and BIMB Securities Sdn Bhd. The bank will also continue to strengthen its Ar-Rahnu services by expanding product offerings and enhancing accessibility, further advancing Shariah-compliant financial solutions to meet evolving customer needs. BIMB said it remains steadfast in addressing environmental and social challenges, particularly climate change and community upliftment. It noted that social finance remains the key pillar in this approach, spearheaded by its globally recognised social finance driver, Sadaqa House.
The Star
13-05-2025
- Business
- The Star
Govt's fiscal path remains on track
KUALA LUMPUR: Malaysia's fiscal path this year remains on track, but timely execution of targeted fuel-subsidy reforms will be critical to offset short-term revenue shortfalls caused by delays in tax measures, BIMB Research says. In a report, the research house noted that while the government's fiscal strategy continues to emphasise economic growth, fiscal responsibility and social welfare, delays in the expansion of the sales and service tax (SST) and the rollout of phase three of e-invoicing are expected to result in 'a minor headwind to ongoing fiscal consolidation efforts'. 'Together, these postponements could result in a total revenue shortfall of about RM2.5bil, equivalent to roughly 0.1% to 0.15% of gross domestic product (GDP),' it said. Although this gap is modest, BIMB warned that 'it may put upward pressure on the fiscal deficit, particularly if not offset by other measures or expenditure controls'. The SST expansion, which was expected to begin on May 1, has been delayed to June 1, while the third phase of the e-invoicing rollout – initially set for July – is now being pushed to next January. The research house said the expanded SST was expected to raise RM5bil annually, while the full e-invoicing rollout could generate between RM3bil and RM4bil in additional tax revenue once fully adopted. It said the revised SST would apply to more non-essential goods, including imported premium goods like salmon and avocados, and extend to more commercial services, with 5% for food and beverages, 8% for logistics, and 10% for other services. The research firm said the third phase of e-invoicing, which targets medium-sized businesses, is seen as crucial, as it captures a broad swath of small and medium enterprises, where compliance gaps are most prevalent. It said the SST expansion, which was expected to generate about RM700mil a month in additional revenue, would now contribute a month later than planned, resulting in a RM700mil shortfall. Meanwhile, the research house estimated the deferment of e-invoicing for medium-sized businesses could cost the government an estimated RM1.8bil in tax revenue in the second half of the year (2H25). However, BIMB Research highlighted that the government still has fiscal space if it proceeds with rationalising the subsidy for RON95 petrol, which 'remains a high-impact policy lever'. 'If implemented in 2H25, even a partial rationalisation could yield savings in the range of RM4bil to RM6bil for the year, depending on global oil prices and the targeted coverage,' it said. It added that such savings could more than offset the RM2.5bil shortfall from the delayed SST and e-invoicing, while creating room for development spending or social support. 'Moreover, it would signal strong policy commitment to structural reforms, enhancing Malaysia's fiscal credibility and investor confidence amid heightened global economic uncertainty,' the research house said. It added that Malaysia's fiscal outlook remains stable, supported by sustained growth in tax collection, new revenue measures such as the capital gains tax and digital tax, and the government's commitment to fiscal discipline. 'The slight delay in implementing the expanded SST and third phase of e-invoicing is not expected to significantly derail Malaysia's economic growth trajectory. 'Momentum continues to be underpinned by a recovery in private consumption and strengthening export performance.' It also noted that the government's projected fiscal deficit of 3.8% of GDP for this year could widen slightly due to the delays, but could return to 3.85% with subsidy reforms in place. Meanwhile, the research house expects the country's debt-to-GDP ratio to stabilise around 62% to 63%, below the 65% statutory ceiling. 'Overall, Malaysia's fiscal outlook for this year remains stable. Continued focus on policy execution and the careful sequencing of fiscal initiatives will be key to ensuring both economic resilience and fiscal sustainability in the medium term,' BIMB Research said.
