BIMB Securities forecasts FBM KLCI’s earnings to grow by 6.7% this year

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KUALA LUMPUR (Jan 7): BIMB Securities Research has forecast the FBM KLCI’s earnings to expand by 6.7% in 2016 with its FBM KLCI target at 1,820 premised on a market PE of 16.5x.

In a strategy note today, the research house said that as expected, December had been a rather good month for the local bourse.

It said that admittedly window dressing activities spurred the FBM KLCI to end the year on a positive note amid some foreign buying interests which saw a net foreign inflow of RM675 million during the final week of the year.

However, the research house said that on the whole 2015 had been a whitewash year domestically for both equities and also currency, it was also a same story regionally albeit to a lesser extent.

“If we are to gauge the cumulative performances of both equities and currencies, Malaysia (-26.7%) stands out as the worst performer within the SEA region whilst the Philippines (-8.75%) was the best performer.

“Whilst we are optimistic that Malaysia will recover in 2016, the picture painted by the consensus remains rather mixed.

“Whilst our peers had predicted that Malaysia’s corporate earnings will grow by 8.0-11.0% with their FBMKLCI targets at 1,750-1,900 for 2016, we have projected 2016 earnings to expand by 6.7% with our FBM KLCI target at 1,820 premised on a market PE of 16.5x,” it said.