MBM Resources Berhad -  Within Expectations
Fri, 29-Aug-2025 02:51 pm
by Research Team • Apex Research

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MBMR (5983)

Target Price (RM)

6.30

Recommendation

Buy

  • 2QFY25 CNP stood at RM72.5m (+7.3% YoY, +1.6% QoQ), bringing the 6MFY25 CNP to RM143.9m (-0.8% YoY). The results were in line with expectations, accounting for 47% of our full-year forecast and consensus estimates.

  • The Group declared a first interim dividend of 7.0 sen (ex-date 17 Sept) (2QFY24: 6.0 sen) and a special single-tier dividend of 15.0 sen.

  • QoQ and YoY CNP growth were driven by resilient sales volumes and ringgit strength.

  • No change to our earnings forecast. We maintain our BUY recommendation with an unchanged TP of RM6.30, pegged to 8.0x FY26F EPS of 78.73 sen

 

Results within expectations. 2QFY25 core net profit (CNP) stood at RM72.5m (+7.3% YoY, +1.6% QoQ), bringing 6MFY25 CNP to RM143.9m (-2.7% YoY). The results were in line with expectations, accounting for 47% of both our and consensus full-year estimates.

 

Dividend increased. The Group declared a first interim dividend of 7.0 sen (ex-date 17 Sept) (2QFY24: 6.0 sen) and a special single-tier dividend of 15.0 sen, bringing total DPS declared for 1HFY25 to 22.0 sen (1HFY24: 16.0 sen).

 

QoQ. 2QFY25 CNP rose 1.6%, with revenue up 4.8% on firmer consumer and OEM demand. JV contribution improved 38% QoQ to RM5.9m on stronger demand from customers and longer working days. Motor Trading revenue advanced 4.6% QoQ to RM524m. Auto Parts revenue gained 6.4% QoQ to RM77.4m, though adjusted PBT eased to RM5.3m on one-off solar installation costs.

 

YoY. 2QFY25 CNP rose 7.3% YoY on the back of a 5.8% revenue uplift, with PBT up 8.4% to RM87.2m driven by stronger vehicle sales and production. JV earnings fell 15.3% to RM5.9m on model mix and cost-down pressures, while associates delivered RM64.7m (+12.6% YoY) supported by stable volumes and a stronger ringgit. Motor Trading revenue grew 4.3% YoY to RM524m on steady Perodua supply, higher Daihatsu sales, incremental VW contribution and Jaecoo’s maiden volumes. Auto Parts PBT softened on customer mix and reduced output from selected carmakers.

 

YTD. 6MFY25 CNP slipped 2.7% YoY, reflecting softer 1Q performance, though the Group outperformed the industry’s 4.6% TIV contraction. Motor Trading & Assembly revenue slipped 1.8% YoY on weaker demand, while Auto Parts rose 6.1% YoY on revised component purchase arrangements. Despite stronger top line, Auto Parts PBT declined 16.3% YoY on lower volumes and adverse customer mix.

 

Outlook. Looking ahead to FY25, MBMR’s earnings growth will be driven by sustained Perodua sales, strong contributions from its auto parts division, and cost optimisation efforts. Perodua’s market leadership and steady demand will support vehicle sales, while the auto parts segment benefits from higher production volumes and efficiency improvements

 

Earnings Revision. No changes to current forecasts.

 

Valuation. We maintain our BUY recommendation with an unchanged target price of RM6.30, by pegging at 8.0x P/E FY26F EPS of 78.73 sen and 0% ESG factored premium/discount based on three-star ESG rating.

 

Risk. US tariff revisions and ongoing trade negotiations have heightened global uncertainties, with potential spillovers to raw material costs, FX volatility, and domestic demand. 

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Disclaimer

The report is for internal and private circulation only and shall not be reproduced either in part or otherwise without the prior written consent of Apex Securities Berhad. The opinions and information contained herein are based on available data believed to be reliable. It is not to be construed as an offer, invitation or solicitation to buy or sell the securities covered by this report.

Opinions, estimates and projections in this report constitute the current judgment of the author. They do not necessarily reflect the opinion of Apex Securities Berhad and are subject to change without notice. Apex Securities Berhad has no obligation to update, modify or amend this report or to otherwise notify a reader thereof in the event that any matter stated herein, or any opinion, projection, forecast or estimate set forth herein, changes or subsequently becomes inaccurate.

Apex Securities Berhad does not warrant the accuracy of anything stated herein in any manner whatsoever and no reliance upon such statement by anyone shall give rise to any claim whatsoever against Apex Securities Berhad. Apex Securities Berhad may from time to time have an interest in the company mentioned by this report. This report may not be reproduced, copied or circulated without the prior written approval of Apex Securities Berhad.

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