KUALA LUMPUR: Hong Leong Capital Bhd (HLCB), recorded a profit after tax of RM29.9 million for H1’25, 23% lower compared to corresponding period in the previous year of RM38.7 million.
The results were primarily impacted by lower income from investment banking division (IB division) and asset management, as well as lower equity investment returns.
Book value per share increase to RM4.26 as at Dec 31, 2024 from RM4.10 a year ago.
HLCB chairman Tan Kong Khoon commented, “The group delivered encouraging results in the first half of FY25, in light of volatile capital markets resulting in lower investment gains and delays in some capital market deals. A key highlight was the continued positive momentum in our stockbroking franchise, driven by increased trading volumes on the local bourse, leading to gains in our domestic retail and institutional market share.”
Looking ahead, he added they anticipate continued positive economic growth in Malaysia, supported by a robust labour market, healthy domestic consumption, a recovery in exports, and rising domestic investment.
However, he said external headwinds could present challenges to near-term growth.
“In particular, the escalation of protectionist policies could lead to heightened trade tensions, inflationary pressures and tighter global financial conditions. Nevertheless, we believe Malaysia’s inherent economic resilience offers a strong foundation for continued expansion,” he added.
HLIB reported a net profit after tax of RM21.9 million, an increase of 2% y-o-y, driven primarily by the improved performance of their stockbroking division (SB division).
The SB division delivered strong results with a profit before tax (PBT) of RM24.9 million, an 18% increase from RM21.2 million the previous year. This growth is attributed to the higher Bursa Malaysia average daily trading volume of RM3.3 billion compared to RM2.5 billion a year earlier. However, their overall market share declined by 0.24% y-o-y to 3.67%, driven by the increase of foreign institution flows, of which HLIB has limited participation. Excluding foreign participation, HLIB’s market share had increased by 0.35% to 5.97%.
“Our IB division reported a lower PBT of RM3.9 million, a decline of 45% y-o-y due to lower profit contribution from our Debt Markets and Treasury & Markets (T&M).
“Our Debt Markets’ performance was impacted by the delay in the completion of a few mandated deals while T&M’s performance was affected by mark-to-market movements arising from widened spreads between bonds and interest rate swap. Our Equity Markets recorded improved deal flows and delivered better profits,” said Tan.
