As we approach the close of 2024, it’s the perfect time to position ourselves for new opportunities in the Malaysian stock market. With Budget 2025, unveiled by Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim on October 18, 2024, there's a lot to look forward to. The budget’s record allocation of RM421 billion underscores the government’s commitment to driving sustainable growth, uplifting public welfare, and ensuring fiscal stability—all essential factors that will impact investor choices in the coming year.

One key highlight in Budget 2025 is Malaysia's GDP growth target of 4.5% to 5.5% for the year, a projection that shows renewed confidence in the economy’s resilience. The aim to reduce the fiscal deficit to 3.8% of GDP, from an estimated 4.3% in 2024, also reflects a disciplined approach to fiscal management. With these ambitious targets, investors can expect a favourable environment for growth across key sectors.

Construction Sector: Key Pick - Gamuda Bhd (5398)

‌The construction sector is set to benefit substantially from Budget 2025, with major allocations for infrastructure projects. This includes the Klang Valley Light Rail Transit (LRT) expansion, valued at RM4.7 billion, as well as RM10 billion for the Penang LRT project and RM11.8 billion for nationwide flood mitigation programmes. These massive investments are expected to boost economic activity and create jobs, making this a promising sector for 2025. My top pick here is Gamuda, well-positioned to capitalise on these infrastructure developments. Known for its strong project portfolio and consistent performance, Gamuda stands out as a robust choice.

Plantation Sector: Key Pick - Lotus KFM Bhd (8303)

‌Budget 2025 has also earmarked RM732.7 million for the Ministry of Plantation and Commodities, signalling ongoing support for diverse commodities beyond palm oil. RM100 million has been allocated for the Palm Replanting Programme Incentive, RM70 million for enhancing palm oil sustainability, and RM10 million for a pilot rubber-tapping project. These initiatives highlight the government's focus on sustainable and diversified growth within the sector. My stock pick here is Lotus KFM, which offers niche exposure to the bamboo segment, a fast-growing and sustainable commodity that aligns well with the sector’s future trends.

Technology Sector: Key Pick - VETECE Holdings Berhad

The technology sector is on an exciting growth trajectory, with Malaysia’s digital economy anticipated to contribute 25.5% to GDP by 2025. The government’s ambitious goal to attract over RM500 billion in semiconductor investments and plans for Southeast Asia's largest integrated circuit design park point to an exceptional growth phase for this sector. VETECE Holdings, with its exposure to Oracle’s tech ecosystem, is my top pick here. VETECE is well-positioned to tap into the booming demand for digital solutions, providing exposure to the sector’s high-growth potential and innovation-led gains.

‌In summary, Budget 2025 lays out a robust strategy to drive Malaysia's economic growth, supporting investor optimism for the coming year. Targeted investments and reforms across the construction, plantation, and technology sectors offer promising opportunities, and these stock picks are set to benefit from the nation’s commitment to sustainable and diversified economic development.