IN­DEX SURGE MAY KEEP IN­VESTORS ON SIDE­LINES

Nev­er­the­less, there are still good buys out there, says fund man­ager

New Straits Times - - Business -

KUALA LUMPUR

THE surge in Malaysian small caps over the last few months may be rea­son enough to avoid buy­ing many of them now. So says Gan Eng Peng, head of eq­ui­ties at Af­fin Hwang As­set Man­age­ment Bhd, cit­ing an 18 per cent gain in the FTSE Bursa Malaysia Small Cap In­dex since Novem­ber.

Stocks in the mea­sure are up more than twice as much as those in the large-cap bench­mark, as a gov­ern­ment plan to sup­port the sec­tor co­in­cided with an emerg­ing mar­ket rally.

“We’re al­ways on the look­out for ideas which are fresh, turn­around situations and deep value plays,” said Gan, whose Asia ex-Ja­pan small and mid-cap fund has re­turned 34 per cent over the past year to beat 96 per cent of its peers.

“With the re­cent run in the in­dex, this is get­ting harder to come by.”

Prime Min­is­ter Datuk Seri Na­jib Razak’s bud­get pledge in Oc­to­ber to es­tab­lish a RM3 bil­lion fund to in­vest in small- and mid­sized com­pa­nies and pro­mote re­search on them stirred in­ter­est in the sec­tor.

The gov­ern­ment’s will­ing­ness to sup­port the sec­tor was im­prov­ing sen­ti­ment and boost­ing de­mand from in­sti­tu­tional in­vestors, said at Phillip Cap­i­tal Man­age­ment Bhd chief in­vest­ment of­fi­cer Ang Kok Heng.

While this had pushed some small and mid-caps “be­yond our tar­gets”, there were still good buys out there, said Ang.

Th­ese in­cluded JAKS Re­sources Bhd, Gabun­gan AQRS Bhd, Ekovest Bhd and ViTrox Corp Bhd, he said. Bloomberg

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