Looking Back at 2025: A Springboard for 2026
Our 2025 picks delivered a better return than the broad market, gaining 10.3% against the FBM KLCI’s 3.9%. That outperformance underscores a few enduring themes: select banks with solid capital positions, exporters riding commodity cycles, and consumer-focused companies that weather higher borrowing costs. As Bursa Malaysia navigates global uncertainty and domestic policy shifts, the path for 2026 favors firms with strong cash flow, disciplined capex, and the ability to pass through cost pressures.
With that frame in mind, we present our 2026 stock ideas across core sectors that typically drive earnings in a Malaysia-linked portfolio: financials, consumer and industrials, commodities and plantations, energy, and technology-led growth. Each pick is chosen for resilience, liquidity, and the potential to compound value over the year.
Our 2026 Picks: A Ten-Stock Shortlist
1) Maybank (MAYBANK) – The flagship bank remains a cornerstone of Malaysian banking. A strong CASA mix, prudent risk management, and a broad regional footprint give Maybank the capacity to deliver steady loan growth and healthier margins as rate normalization continues.
2) Public Bank (PBBANK) – Known for its low credit costs and conservative risk appetite, Public Bank could outperform in a higher-rate environment and during periods of improved asset quality.
3) CIMB Group (CIMB) – With a diversified income base across Malaysia, Indonesia, and Singapore, CIMB offers earnings resilience through cross-border fee income and improving ROE as costs are managed.
4) Genting Berhad (GENTING) – A diversified leisure and hospitality name that benefits from a gradual reopening cycle and a potential uptick in travel demand, supported by a robust balance sheet.
5) IOI Corporation (IOICORP) – A key planter with exposure to crude palm oil and downstream products. In a year of variable commodity prices, IOI’s integrated model can help stabilize margins.
6) Sime Darby Plantation (SIME) – As a major palm oil producer, Sime Darby Plantation carries macro exposure to demand and prices, but its scale and vertical integration can support cash flow generation.
7) Top Glove (TOPGLOVE) – A global glove maker that benefits from healthcare demand and production efficiencies. A disciplined capex plan and cost control could drive margins higher as demand normalizes post-2020s disruptions.
8) Hartalega Holdings (HARTAL) – A high-quality nitrile glove producer with advanced manufacturing processes. If input costs stabilize and demand remains strong, Hartalega could deliver solid earnings growth.
9) Petronas Dagangan (PETDAG) – As a key downstream energy retailer, PETDAG can benefit from stable domestic fuel volumes and potential regulatory tailwinds that support profitability.
10) Tenaga Nasional (TENAGA) – The national utility company offers a defensive earnings profile with regulated returns and potential upside from efficiency programs and fuel-cost pass-throughs.
Notes on the list: these picks span financials, consumer and industrials, plantation and commodities, energy, and specialty manufacturing. Each stock is chosen for liquidity, governance, and the potential to deliver earnings growth even as macro conditions shift. We are mindful of valuation risk and prefer names with robust free cash flow and prudent balance-sheet management. As always, diversification and a careful rebalancing plan remain essential as 2026 unfolds.
What This Means for Your Portfolio
For 2026, the overarching message is balance: blend reliable yielders with growth-oriented plays and maintain exposure to domestic demand. Keep an eye on earnings visibility, dividend capacity, and the ability to navigate rising or stabilizing interest rates. Our ten-pick framework aims to provide a diversified spine for a Malaysian equity sleeve while retaining upside potential from sector leaders.
Strategy tips for 2026
- Monitor macro factors that affect interest rates, commodity prices, and exchange rates, as they influence earnings translation and input costs.
- Review quarterly earnings with a focus on free cash flow, dividend payout trends, and balance-sheet strength.
- Maintain liquidity to opportunistically add on dips while sticking to your core long-term thesis.
This article originally appeared in The Edge Malaysia Weekly from December 22–28, 2025, and reflects our forward-looking stance for 2026 based on 2025 performance and market dynamics.
