KUALA LUMPUR: Gamuda Bhd is likely to be included in the next FBM Kuala Lumpur Composite Index (KLCI) review in December, with 99 Speed Mart Holdings Bhd possibly in the reserve list and Genting Malaysia Bhd removed.
MIDF Research in its note on the upcoming semi-annual review of the benchmark index said it does not expect 99 Speed Mart to qualify for fast entry inclusion given that its market capitalisation was only 0.8 per cent of the entire FBM Emas Index, lower than the requisite 2.0 per cent or more.
The firm said that the share price, which last traded at RM1.88 on last Friday, commands a market capitalisation of RM15.79 billion, placing it 33rd.
It will likely be included in the reserve list in the upcoming review.
"For it to ascend into the FBM KLCI by Dec 2024, its share price must climb to RM2.41, if everything else remains status quo."As a comparison, Mr DIY Group (M), which was listed on the Oct 26, 2020 at RM1.60, entered the FBM KLCI during the Jun 2021 review after its share price rose 2.4 times to RM3.89 (before one-for-two bonus issue in Jun 2022)," it added.
MIDF Research said Gamuda could be added to the FBM KLCI after two-years of being on its reserve list while Genting Malaysia potentially removed following its reduced market capitalisation.
The semi-annual review is scheduled on Dec 23.
The report highlighted that since the review on 24 June 2024, Gamuda's share price has increased by 19 per cent to RM7.59 as of Sept 13, placing it 24th in terms of market capitalisation.
Since the review in June this year, the company's share price has increased by 19 per cent to RM7.59 as at Sept 13, ranking 24th based on market capitalisation.
"As long as it remains at the 25th spot and above by the cut-off date (Nov 25), an inclusion into the index is rather certain as Gamuda meets both the free float and liquidity requirements.
"Gamuda's previous entry into the FBM KLCI was more than a decade ago on Sept 20, 2010, replacing Tanjong that was taken private. Gamuda was removed from the index in the December 2011 review alongside MISC to make way for Bumi Armada and AirAsia," the firm said in a research report.
On Genting Malaysia, MIDF Research said it has fallen to the 36th spot in terms of market capitalisation.
If it remains at that position by the cut-off date of the upcoming review, the firm said it will have to be deleted from the index, going by the ground rules, making way for Gamuda's potential entry.
"With the expected inclusion of Gamuda into the FBM KLCI, the construction sector reemerges again in the index with an estimated weightage of 3.18 per cent.
"The consumer products and services sector will see a reduction from 9.81 per cent to 8.48 per cent with the potential removal of Genting Malaysia. Financial services will remain the anchor sector of the index with a weightage of 41.90 per cent," it added.