Broker: Maybank Research Pte Ltd
Date of Report: 9 June 2025

ASEAN Markets Poised for Growth: Top Stocks, Sector Insights, and Key Risks in 2025

Regional Outlook: Optimism Amid Negotiation Apprehension

The ASEAN equity landscape is set for a robust 2025, with Maybank Research maintaining an OVERWEIGHT stance on Singapore, Malaysia, and Indonesia. Domestic resilience, capital returns, and the AI-driven upcycle underpin the positive outlook for Singapore, while Malaysia is buoyed by broad-based investment and Indonesia by rate-sensitive sectors. Meanwhile, Vietnam could extend its recent outperformance, pending successful tariff negotiations and ongoing economic reforms. The “Sell America” trend, triggered by moderating US job growth and trade tensions, is expected to further benefit ASEAN equities and currencies as global investors seek diversification.

• Top Overweight Markets: Singapore, Malaysia, Indonesia
• Neutral Markets: Thailand, Philippines, Vietnam
• Currency Outlook: SGD, MYR, THB, and IDR likely to appreciate as USD weakens
• Key Risks: Tariff negotiation outcomes, US macro volatility, and sector-specific headwinds

Singapore: Safe Haven with AI and Capital Return Upside

Singapore remains a preferred market due to its domestic resilience and safe haven appeal. The investment case is strengthened by capital returns and growing AI adoption across key sectors.

• Key Stock Picks: SCI, STE, RFMD, CD, CICT, FCT, Grab, ST
• Sector Outlook: Singapore banks face a low single-digit loan growth (3.4% YoY in April 2025), with NEUTRAL ratings maintained due to tariff-related macro uncertainty. However, Singapore REITs remain POSITIVE, supported by falling rates and resilient economic growth.
• Key REIT Picks: CICT, CLAR, CLAS, FCT, MLT, MPACT, PREIT

Malaysia: Investment Upcycle and Policy Support

Malaysia stands to benefit from anticipated policy rate cuts in the third quarter, fueling rising investments and consumption. The oil & gas sector faces a downgrade to NEUTRAL due to lower offshore activity and a reduced Brent crude assumption (USD67/bbl for 2025), but other sectors are poised for growth.

• Top Picks: AMMB, PBK, GAM, ECW, YTLP, KPJ, ITMAX, TNB
• Oil & Gas Top Buys: Dialog and BArmada

Indonesia: Rate Sensitivity and Weaker USD to Drive Gains

A weaker USD and potential rate cuts could boost Indonesia’s equity market, particularly in banks and developers.

• Top Picks: BBCA, BRIS, PWON, CIPUTRA, INTP, SMGR

Vietnam: Awaiting Tariff Outcomes, Reforms Underpin Growth

Vietnam’s trajectory depends on tariff negotiation results. Structural reforms and the prospect of a market upgrade support a constructive view.

• Preferred Sectors: Infrastructure (VHM, HPG, ACV), Banks (TCB, MBB), Consumer (MWG)

Sector Spotlights and Company Analyses

Capital A: Soaring Higher on Strong Fundamentals

Capital A, the low-cost carrier operator, has been upgraded to BUY following better-than-expected results. Key catalysts include a weaker USD, lower jet fuel prices, and a fleet operating at full capacity. Financially distressed status is expected to be lifted by September 2025, with dual listings in Hong Kong and the US on the horizon.

• Upside: 28% potential
• New SOTP-TP: MYR1.09 (up from MYR0.86)
• Key Catalysts: PN17 status removal, Hong Kong/US listings, capital restructuring

KPJ Healthcare: Buying Opportunity on Mispriced Weakness

KPJ Healthcare’s shares fell 8% after expected seasonal softness in 1Q25, presenting a value opportunity. Healthy fundamentals, anticipated earnings rebound in 2H25, and a positive sector outlook support a BUY rating.

• Implied FY26E EV/EBITDA: 13x
• Target Price: MYR3.24

PTT Global Chemical: Downgrade on Prolonged Downcycle

PTTGC is downgraded to SELL with a target price of THB16 as the petchem downcycle is expected to last until at least 2028E. Recent optimism around US-China trade and Chinese stimulus is seen as unjustified, with valuation concerns persisting.

• P/tangible BV: 0.68 (second highest in Thai downstream)
• Preferred Alternative: SPRC (BUY, TP THB9.1)

IHH Healthcare: Resilience Across Geographies

IHH Healthcare delivered in-line 1Q25 results, supported by stable revenue and EBITDA margins. Despite geopolitical and regulatory challenges, the outlook remains bullish, with the company focused on organic and opportunistic inorganic growth.

• Target Price: MYR7.97

Singtel: Capital Returns Drive Narrowing Holdco Discount

Singtel’s FY25 results highlight strong execution, with buybacks and dividends now central to its investment case. The company remains well-positioned for upside as its Holdco discount narrows and core operations, as well as key associates (Optus, NCS, Airtel, AIS), show solid traction.

• Target Price: SGD4.30
• Holdco Discount: 20%

CapitaLand Ascendas REIT: Strategic Acquisitions Add Growth

CapitaLand Ascendas REIT (CLAR) is acquiring a tier-III co-location data center at 9 Tai Seng Drive and a business park at 5 Science Park Drive, both completed in 2019 and fully occupied. These assets will increase CLAR’s Singapore presence to 67% of AUM and boost exposure to tech tenants.

• DPU Accretion: 1.36% (1% including deferred payment and excess equity)
• Pro-forma Gearing: 38.4% (from 38.9% at end-1Q25)
• Growth Potential: Under-rented assets (30% for DC, 15% for business park); possible lease step-ups and added power capacity

Major Developments in the Region

Great Eastern: Fresh Delisting Bid by OCBC

OCBC has launched a new exit offer for Great Eastern at S\$30.15 per share, aiming to delist the insurer after a prior S\$25.60 offer. The offer is conditional on at least 75% shareholder approval at an extraordinary general meeting.

Keppel: Accelerated Monetisation Program

Keppel has divested S\$80 million of assets as part of its S\$10-12 billion monetisation target by 2026. Recent sales include a 20.5% stake in Computer Generated Solutions, aligning with Keppel’s strategy to unlock value from non-core assets.

Sats: Divestment to Strengthen Balance Sheet

Sats has proposed selling its 49% stake in Servair-Sats to Gategroup for 4.2 million euros, as part of its capital recycling efforts. The proceeds are expected to bolster the balance sheet and allow a greater focus on core strategic businesses.

Technical Trading Ideas: Nanofilm and Thakral Corp

• Nanofilm Technologies (NANO SP): Bullish reversal breakout, potentially entering a new upcycle. Buy range: SGD0.530-0.560; resistance at SGD0.605/0.660; stop-loss below SGD0.490.
• Thakral Corp (THK SP): Signs of potential profit-taking after a strong run. Sell range: SGD1.52-1.56; support at SGD1.43/1.25; stop-loss above SGD1.65.

Macro Commentary: Recalibration in the Works

Recent volatility in global markets, driven by US protectionist policies and a weakening USD, has favored ASEAN assets. The “Sell America” narrative is underscored by increased currency and equity flows into the region, with the USD’s decline set to continue as long as US macro headwinds persist.

Upcoming Events and Sector Summaries

• ASEAN Corporate2U Series: Thailand – Humanica Plc (HUMAN TB) on 10 June
• ASEAN Corporate2U Series: Bermaz Auto (BAUTO MK) on 13 June

Dividend and Insider Activity Highlights

• Top dividend yields and insider activities are closely monitored, offering additional signals for value-seeking investors.

Conclusion: ASEAN Positioned for Outperformance

With easing macro headwinds, attractive valuations, and robust sectoral drivers, ASEAN markets are poised to outperform in 2025. Investors are encouraged to focus on markets and sectors highlighted above, while monitoring ongoing policy and tariff developments for new opportunities.