KUALA LUMPUR (Dec 24): Permodalan Nasional Bhd (PNB) remains optimistic about the outlook for Malaysia's economy and the local bourse next year, underpinned, among others, by clear economic policies and steady inflows of foreign direct investments (FDIs).

President and group chief executive Datuk Abdul Rahman Ahmad said policies such as the National Energy Transition Roadmap and the National Semiconductor Strategy have been well received, bolstering investor confidence.

He also noted that the country is currently experiencing a third wave of investment upcycle, which was contributed greatly by FDI inflow.

“The combination of well-received economic policies, strong FDI inflows driven by electrical and electronics sector and data centres, and robust domestic direct investments indicates real activity on the ground.

"This positive trend reflects the close relationship between the economy and the stock market. I believe that the momentum we have in 2024 will continue in 2025," he said during an editors' briefing at Menara 118.

Currently, 77% of PNB’s assets are invested domestically, with 60% of that allocation in the public equity market, mainly in the FBM KLCI, Abdul Rahman said.

“One potential risk is that while the Malaysian economy performs well, this has not yet translated into better earnings or performance for corporate Malaysia,” he added when asked about concerns that can derail the projection next year.

When asked about potential merger and acquisition activities following the Sime Darby Bhd (KL:SIME)-UMW Holdings Bhd deal, as well as the possibility of similar initiatives in the oil and gas sector involving Sapura Energy Bhd (KL:SAPNRG) and Velesto Energy Bhd (KL:VELESTO), Abdul Rahman emphasised that PNB’s priority is ensuring that Sapura Energy completes its debt restructuring.

“Sapura Energy’s debt restructuring scheme has been extended to March 2025, and completing this process is vital for stabilising its operations,” he said.

PNB also stated that it remains focused on reviewing its portfolio performance, adopting a bottom-up approach to identify companies with strong organic growth potential.

On June 6, it was reported that Sapura Energy had been granted a nine-month extension by the High Court for the convening and restraining orders obtained in March 2024, allowing the company to continue restructuring its debts. These new orders are effective from June 11 to March 10, 2025.

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