Maybank rises after EPF ups stake, foreign shareholding rebounds from lowest in four years

Maybank rises after EPF ups stake, foreign shareholding rebounds from lowest in four years
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KUALA LUMPUR (Oct 27): Malayan Banking Bhd's (Maybank) share price settled higher at Wednesday's (Oct 27) Bursa Malaysia afternoon break after Maybank said on Tuesday (Oct 26) the Employees Provident Fund (EPF) upped its direct stake in Maybank to 14.1% comprising 1.67 billion shares on Thursday (Oct 21) when the EPF acquired 12.62 million shares and as investors took cue from Maybank's higher foreign shareholding update.

At 12.30pm on Wednesday, Maybank's share price settled up four sen or 0.49% at RM8.16, which gives the bank a market capitalisation of about RM96.86 billion after the stock was traded between RM8.14 and RM8.18 so far.

Maybank's latest reported number of issued shares stood at 11.87 billion, according to its Bursa filing on Thursday (Oct 21). Maybank's share price has risen to current levels from its closing share price of RM8.01 on Oct 5.

Maybank's share price rose on Wednesday (Oct 27) as investors also took cue from Maybank's update that its foreign shareholding had risen to 16.22% as at Oct 15 from 16.14% on Oct 8, 2021.

Updates on Maybank's website showed that its 16.14% foreign shareholding as at Oct 8 was the lowest in over four years since Feb 3, 2017 when the bank's foreign shareholding stood at 16.07%.

In a Tuesday (Oct 26) Bursa filing, Maybank said the EPF on Thursday (Oct 21) acquired the 12.62 million shares in two tranches of 11.73 million and 888,000 units.

After the purchases, the EPF's Maybank stake rose to 14.1% from 13.99% a day earlier, according to Maybank.

Maybank are among stocks closely watched by analysts for its low foreign shareholding relative to its historical levels.

In a Tuesday (Oct 26) note, Hong Leong Investment Bank Bhd analyst Jeremy Goh said that within Hong Leong's coverage, stocks that have low foreign shareholding relative to their historical levels that Hong Leong has "buy" rating on include FBM KLCI components Maybank, Tenaga Nasional Bhd and Sime Darby Plantation Bhd.

"(Across Bursa) After 25 months of consecutive equity outflow, foreigners turned net buyers from Aug to MTD (month-to-date)-Oct totalling +RM3.5bn. While still premature to say if recent inflows can sustain in the coming months, we opine that foreign shareholding has scraped the bottom of the barrel, hitting a low of 20.2% in July-Aug before inching up to 20.4% in Sept.

"Judging from foreign inflows thus far into Oct, we estimate that foreign shareholding could recover further to 20.6% this month (+0.2ppts MoM). From our analysis of the KLCI and foreign shareholding — computing a 69% correlation — a recovery in the latter (foreign shareholding) could provide some market uplift.

"We keep our end-2021 KLCI target unchanged at 1,640," he said.

At 12.30pm on Wednesday, the 30-stock KLCI settled up 1.04 points or 0.07% at 1,585.24.

Chong Jin Hun