[Tindak-tanduk Mahathir yang terkini serta rancaknya pergerakkan pasaran saham Malaysia menyebabkan banyak pihak menggeleng kepala. Malaysia sudah menjadi seumpama papan berjudi...... - Editor]

http://www.asiaweek.com/asiaweek/magazine/ Enterprise/0,8782,173087,00.html

Asiaweek

SEPTEMBER 7, 2001

The Unlikeliest Bet

Malaysia's stock market has been the region's best performer in the past three months. Here's what to do next

By ASSIF SHAMEEN

Quick, which is Asia's best-performing stock market over the last three months? (Hint: not Indonesia.) The answer is Kuala Lumpur, and while it is true that "best performer" is not the most competitive category these days among regional exchanges, the Malaysian bourse has grown a healthy 23% since the end of May. This is more than an odd bit of trivia. If you truly believe that the early stirrings of corporate restructuring and improved transparency in Malaysia are real, there is a way to play this market. "But from here on, you have to be very, very selective," says Ang Siok Peng, investment manager with Credit Suisse in Singapore. "All the easy gains have pretty much been made."

One way to do it is focus directly on the restructuring story. Ng Eian Kiam, fund manager with Indocam Asia in Singapore, likes conglomerate Malaysian Resources Corporation Bhd. (MRCB), which recently got a new chief executive in Abdul Rahman Ahmad, and Time Engineering, formerly part of Halim Saad's empire. Ng thinks future restructuring of Malaysia's crowded telecommunications market could help a Time subsidiary, Timedotcom. Kum Seok Chin, a fund manager at Morley Fund Management in Singapore, likes the infrastructure and construction companies that would benefit from a new government stimulus package, which is expected. In March, Malaysia unveiled an $800 million emergency spending plan. She likes IJM Corp., Gamuda and Road Builder, two Kuala Lumpur-based heavy-construction companies. Kum says there is a more level playing field for big contracts than in the past.

But be careful. Until late June, most foreign brokerages rated Malaysia as a market to avoid -- "underweight" was the verdict. It was when a few analysts raised their view of the market to "neutral" that a rally began in earnest. Still, this is not a ringing endorsement. "Malaysia has made all the right noises and all the right moves after ignoring investor sentiment," says Ng. "But there are people who are still skeptical." Also, Malaysia is especially vulnerable to the global technology recession because so much of its economy is geared toward exporting electronics to the U.S. market.

Even for the optimists, there are parts of Malaysia's economy you want to avoid. Prime Minister Mahathir Mohamad says he'd like to see banks take a bigger haircut from non-performing loans. Many technology manufacturers still rely on Japanese and American brands for business, and those consuming markets show little sign of life. Some economists see more layoffs ahead at tech-related companies in Malaysia. PC maker Gateway announced this week it would close its Malacca plant, which employs 400. Look on the bright side, says Morley Fund's Kum: Kuala Lumpur stocks "have momentum." Remember the days when that counted for something? "Momentum investing" meant that last week's winning counters were probably good picks for the coming week as well. If only it were still so simple.