Bursa Malaysia’s ADTV to reduce by 18.5 pct to RM3.6bil in 2H?

KUALA LUMPUR: Bursa Malaysia Bhd’s equity average daily trade value (ADTV) is expected to decline by 18.5 per cent to RM3.6 billion in the second half (2H) of 2021, according to CGS-CIMB Research.

Its analyst Winson Ng said this is given the more cautious market sentiment, as the ADTV fell by 30.7 per cent for the first 18 trading days in July 2021.

“We project a 21.8 per cent slide in Bursa’s 2H of 2021 net profit to RM164.4 million. We also forecast 2H’s net profit dwindling by 27.5 per cent year-on-year (YoY) on the back of a 31.7 per cent YoY drop in 2H 2021 ADTV,” he said in a research report today.

CGS-CIMB Research has retained its FY21-FY23 earnings per share forecast for Bursa Malaysia but pegs its target 2022 price-earnings-ratio (PE) to 1 s.d premium over a five-year historical average of 21 times.

“This is in line with our expectation for lower equity ADTV in 2H of 2021 (partly due to cautious market sentiment) and FY22. With this, our target 2022 PE declines from 31.7 times to 25.8 times, leading to a drop in our target price for Bursa from RM9.18 to RM7.48.”

However, the research firm said Bursa Malaysia’s share price would be supported by the attractive dividend yield of 5.5 per cent in FY21.

Bursa Malaysia’s net profit jumped 39.4 per cent to RM210.4 million in the first half (1H) ended June 30, 2021, from RM151.0 million posted a year ago.

This was attributed to higher operating revenue, which grew by 31.0 per cent to RM420.2 million from RM320.7 million in 1H 2020.

Source: NST