The Malaysia Stock Exchange, or Bursa Malaysia, might not be a well-known bourse outside Malaysia. However, the market has a unique feature that no other minor exchanges would have. It has many listed subsidiaries of many high quality multinational companies in the exchange. Due to certain special requirement for foreign businesses to operate in Malaysia, many of the multinational has floated their Malaysian subsidiaries on the exchange as a result. Here are our top picks.
Good Food, Good Life
Nestle SA (NESN:VX) is a Swiss multinational food and beverage company which is owner to famous brands like Maggi, KitKat, Nescafe and Milo. In fact, the company is the largest food company in the world as measured by its revenue.
Back in 1912, Nestle started its operation in Malaysia. Currently, its subsidiary, Nestle Malaysia Bhd (NESZ:MK) has become one of the blue chip companies listed in the Bursa. Nestle SA continues to owned about 72.6% of the company. Its long history and strong reputation has resulted in a company that has been consistently profitable and growing for the past few decades. The earnings per share of Nestle Malaysia has risen from 94 sen per share in FY2004 to 239.5 sen per share in FY2013. Its share price has also been a great performance since then, rising from a low of RM20.8 per share in 2004 to the current RM70.10 per share. Nestle Malaysia Bhd should be on everyone’s watchlist.
Probably The Best Beer In The World
Carlsberg A/S (CARLB:DC) is one of the major brewery in the world. Currently the group owns brands like Carlsberg, SKOL, Somersby and Jolly Shandy. The company also has a listed entity in Malaysia called the Carlsberg Brewery Malaysia Bhd (CAB:MK). Carlsberg Malaysia has been listed in Malaysia Since 1971. Its main product, Carlsberg Green Label, is the best selling beer in Malaysia. Carlsberg Malaysia is also in charge of the Singapore’s business which it has a 21% market share and small exposure in India and Sri Lanka. The company is also one of the best dividend payer in the market, currently having a dividend yield of 5.3%.
Better Ideas, Better Life
Amway is one of the oldest multilevel marketing companies in the world. It is also one of the largest Unlisted MLM companies globally today. Its founders, Rich DeVos and Jay Van Andel, have always prided itself as a family-owned business. The direct selling business model is one of the best model from a company point of view because you are able to employ a vast army of sales personnels without incurring a huge fixed operation cost and Amway, is one of the industry’s best. Yet, the company has a listed subsidiary in Malaysia called Amway (M) Holdings Bhd (AMW:MK). The company has the right to distribution in Malaysia and Brunei. The company operates at a return of equity of more than 40% for the past few years. Its gross margins are above 30% and its free cash flow to capital is around 40% for the past few years. The company continues to be a stable and strong dividend payer throughout the last decade.
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All views and opinions articulated in the article were expressed in Stanley Lim’s personal capacity and does not in any way represent those of his employer and other related entities. Stanley Lim does not own any companies mentioned above