The Bursa Malaysia Consumer Products & Services Index is a benchmark that, as the name suggests, tracks the performance of companies listed on Bursa Malaysia operating within the consumer products and services sector.
This index encompasses businesses that are involved in the production, distribution, and retail of a wide range of goods and services that cater to everyday consumer needs—from food and beverages to personal care, retail, and leisure services. It offers investors a view of the companies that drive consumer spending in Malaysia.
Consumer products and services companies are often regarded as a core component of a resilient economy. Launched in 1993, as of August 30, 2024, the index includes 167 constituents and represents a total market capitalisation of MYR 261.74 billion.
Bursa Malaysia Consumer Products & Services Index Performance
Despite a rise in late 2023 and early 2024, the index has declined significantly and is currently trading at levels last seen in April 2020. The decline in the stocks has been, in part, put down to the rise of certain commodities. Nevertheless, many expect that, over the long term, the index will rise.
| Period | Performance (as of February 2025) |
|---|---|
| 1-Year Performance | -5.93% |
Bursa Malaysia Consumer Products & Services Index Top 5 Companies
The index is reviewed quarterly in March, June, September, and December.
| Company | Market Cap |
|---|---|
| Nestle (M) BHD | MYR 21.37 Billion |
| Petronas Dagangan | MYR 19.07 Billion |
| PPB Group | MYR 16.25 Billion |
| Mr D.I.Y. Group (M) | MYR 14.10 Billion |
| Sime Darby | MYR 15.47 Billion |
Malaysia Consumer Products & Services Stocks Forecast
The Bull Argument: In January, BIMB Securities Research said that the food and beverage will benefit from a projected rise in disposable income. They explained that consumers will shift towards premium options within the same product categories. They reportedly added that an increase in consumer spending is expected due to the upcoming civil servant wage hike, the minimum wage hike, the continued and elevated allocation of cash assistance like Sumbangan Tunai Rahmah, the Employees Provident Fund (EPF) Account 3 withdrawals and strong tourism activities.
Overall, the sector should benefit from the continued growth driven by changing consumer lifestyles and rising disposable incomes in Malaysia. Many analysts observe that increased digitalisation, the expansion of e-commerce, and innovative retail formats are transforming the sector in the country, leading to improved customer engagement and enhanced revenue streams.
The Bear Argument: Conversely, as we mentioned earlier, an increase in certain commodity prices, such as coffee and cocoa, can impact the sector, weighing on margins. Meanwhile, BIMB Securities Research noted that there was an increase in the sugar tax on sugary drinks, from 50 sen to 90 sen per litre. However, they said it will “have minimal impact, as most companies are operating well below threshold.” Even so, investors should keep a close eye on similar factors that may come into play in the future.
Other factors to watch include trade tensions and the introduction of new tariffs, intensifying competition from both established brands and private-label products, which could squeeze profit margins, and supply chain disruptions and rising labour costs, as they could further exacerbate risks, potentially leading to reduced profitability for some names in the sector.
Our View: The Bursa Malaysia Consumer Products & Services Index offers an opportunity to invest in a key segment of the Malaysian economy, which is expected to grow steadily over the long term. The steady growth is underpinned by a resilient consumer base and an evolving retail landscape that continues to adapt to modern trends.
However, investors must remain cautious of short-term volatility triggered by trade policies and rising operational costs.
Who Should Invest in Malaysian Consumer Products Stocks
For investors interested in Malaysia consumer stocks, the iShares MSCI Malaysia ETF has a 10.17% weighting to consumer staples stocks and a 4.06% weighting to consumer discretionary names.
Investors with an interest in the consumer sector and a focus on the Malaysian market will find It is ideally suited for:
Growth-Oriented Investors: Those looking to tap into the expanding consumer market in Malaysia, driven by rising incomes and evolving lifestyles.
Long-Term Investors: Given the sector’s potential for sustainable growth over time, investors with a longer investment horizon may benefit from the steady capital appreciation.
