Broker: CGS International
Date of Report: July 23, 2025

Malaysia’s Merdeka Goodies: How New Government Measures Are Set to Boost Private Consumption and Consumer Stocks

Malaysia’s Bold Move to Ease Cost of Living and Stimulate Private Consumption

Malaysia has unveiled a suite of strategic measures to address rising living costs and support private consumption. Announced by Prime Minister Datuk Seri Anwar Ibrahim ahead of the country’s Independence Day, these initiatives underscore a record-high investment in cash assistance and targeted subsidies aimed at benefiting the broader population while maintaining fiscal responsibility.

Key Government Initiatives: Cash Handouts, Fuel Subsidies, and More

• One-Off Cash Handout: Under the Sumbangan Asas Rahmah (SARA) programme, all adult Malaysian citizens will receive a one-off RM100 cash handout via their MyKad. This amount can be spent on daily necessities at over 4,100 participating outlets—including Mydin, Lotus’s, Econsave, and 99SpeedMart—from August 31, 2025, to December 31, 2025.
• Wider Reach and Record Allocation: Estimated to benefit 22 million adults, the initiative involves an RM2 billion allocation, representing 0.1% of 2025’s forecasted GDP. The total allocation for Subangan Tunai Rahmah and SARA cash assistance rises to RM15 billion for 2025, up from RM10 billion in 2024.
• Targeted RON95 Fuel Subsidy: The government will implement targeted RON95 fuel subsidies, reducing the pump price from RM2.05/litre to RM1.99/litre. Higher income earners and foreigners are likely to be excluded and will pay market rates. This targeting, along with reduced smuggling as observed in previous diesel subsidy retargeting, is expected to fund the lower pump prices for the masses.
• Expanded Madani Rahmah Sales: The allocation for Madani Rahmah Sales—offering daily essentials at discounted prices—doubles to RM600 million, with plans for greater geographical coverage.
• Toll Rate Freeze: The scheduled toll rate increase along 10 highways is frozen, costing the government RM500 million in compensation to concessionaires.

Implications: Strong Tailwinds for Private Consumption

These measures are expected to significantly bolster private consumption, with forecasts indicating a 5.5% year-on-year increase in 2025. The latest announcements build upon earlier initiatives, such as the flexible EPF Account 3 (May 2024), civil servant salary increases (Dec 2024 and Jan 2026), and a minimum wage hike (February 2025).

Direct Beneficiaries: Retail and Consumer Stocks in the Spotlight

The direct injection of cash and targeted subsidies are poised to benefit several retail and consumer discretionary companies. Here’s a detailed look at the highlighted companies:

99 Speed Mart Retail Holdings

• Recommendation: HOLD
• Target Price: RM2.30
• Current Price: RM2.34
• Profile: Malaysia’s largest mini-market chain, with 2,833 outlets nationwide.
• Outlook: With most of its products likely eligible under the RM100 SARA cash handout initiative, 99SpeedMart stands as a direct beneficiary. The company’s extensive network ensures widespread access, although it remains unclear if all outlets will participate. The anticipated increase in customer traffic could boost sales across both essential and discretionary categories.

Mr D.I.Y. Group (M) Bhd

• Recommendation: ADD
• Target Price: RM2.09
• Current Price: RM1.64
• Profile: One of Malaysia’s largest retail chains, specializing in household cleaning products, personal hygiene items, and school supplies.
• Outlook: MRDIY is included in the RM100 SARA initiative, with some outlets confirmed to accept the handout. The expected increase in footfall could enhance revenue, especially as shoppers may purchase additional non-necessity items during their visits.

Mynews Holdings Berhad

• Recommendation: ADD
• Target Price: RM0.75
• Current Price: RM0.535
• Profile: Operates MyNews and CU convenience stores, serving a broad mass market.
• Outlook: Higher disposable and discretionary incomes from the government’s measures are expected to benefit MyNews. Its diversified range of stores positions it well to capture increased consumer spending.

Other Potential Beneficiaries

Higher consumer spending is likely to spill over to other mass-market retailers such as 7-Eleven and F&N, particularly those with strong reach in daily essentials and discretionary segments.

Annual Allocation for Broad-Based Cash Aid (RM Billion)

Conclusion: Robust Support for Malaysian Consumers and Retail Sector

Malaysia’s record cash handouts, targeted fuel subsidies, and expanded discount sales initiatives signal a strong commitment to easing the cost of living and driving private consumption. The measures are designed to maximize impact among mass-market consumers while funding is prudently managed through targeted subsidy rationalization and anti-smuggling efforts.
Retailers with significant national footprints and a broad product mix—such as 99SpeedMart, MRDIY, MyNews, 7-Eleven, and F&N—are well-positioned to capture the anticipated surge in consumer spending. Investors and market watchers should monitor developments closely as the government finalizes subsidy targeting details and rolls out these impactful measures.