Alleged losses need better analysis
FocusM | 03 Aug 2018 00:30
Much has been said about the RM2 bil in market capitalisation being wiped out in the local stock market following the en masse resignation of the Khazanah Nasional Bhd board on July 26. How accurate is this?
The fact is, the very next day on Friday, July 27, the benchmark FBMKLCI went up 2.91 points, or 0.2%, with the market capitalisation of Bursa Malaysia’s 30 index stocks rising by RM4 bil. Then on Monday, July 30, the FBMKLCI went up a further 1.12 points to 1770.26.
Hence, it is strange to say that over RM2 bil was wiped out from the market as a result of Khazanah’s board resignations as Telekom Malaysia Bhd, Axiata Group Holdings Bhd and Malaysia Airports Holdings Bhd (MAHB) are Khazanah-linked government-linked companies (GLCs). This is because several other Khazanah-linked GLCs gained in market capitalisation, tipping the FBMKLCI into a net gain on July 27.
For instance, Tenaga Nasional Bhd closed unchanged on July 27 but rose 4 sen on July 30, gaining RM4 bil in market capitalisation. Sime Darby Bhd rose 2 sen on July 30, gaining RM136 mil in market capitalisation. Hence the loss in terms of market capitalisation must be taken in perspective.
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