How to Invest In The Growing Middle Class Of Malaysia

This article was first published on Jun 18, 2014

 

Malaysia is one of the fastest growing regions in Southeast Asia. It has a young population and a growing middle class. The government is implementing structural changes to ensure that Malaysia do not fall into the

middle income trap and continue to transform itself into a developed nation by year 2020.

 

With the growing middle class and wealth of the people, the potential for the retailers in the country is huge. We look at some of the companies that are exposed to this segment and how we can get exposure to the growth story of Malaysia.

 

General Retailer

Aeon Company (m) Bhd (AEON: MK) runs a huge network of supermarkets and hypermarkets selling products from household goods, clothing and grocery. It targets slightly upmarket customers and continue to grow year over year.

 

Discretionary Retailers

Padini Holdings (PAD: MK) is one of the country most famous brand. It manufactures and retail garments, apparels and accessories. The company currently has about 8 brands and is expanding regionally.

Bonia Corp (BON: MK) is a luxury brand in Malaysia. It manufactures and retail leather goods, watches, eyewear and female luxury goods. The company has attracted fame investor Creador Malaysia and even a potential investment by Louis Vuitton.

Poh Kong (PKH: MK) is one of the largest jewellers in Malaysia. It focuses in gold products and currently trade below its net asset value.

 

Value In Action

The growing middle class will benefit these companies a lot. However, how the company is able to capture this potential market is still anyone’s guess.

 

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All views and opinions articulated in the article were expressed in Stanley Lim’s personal capacity and do not in any way represent those of his employer and other related entities. Stanley Lim do not own any shares from the above article.

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