CGS International
July 23, 2025

Malaysia’s “Merdeka Goodies”: New Measures Set to Boost Consumer Stocks and Private Consumption

Overview: Malaysia’s Bold Moves to Ease Cost of Living

Malaysia’s government has unveiled a series of impactful measures aimed at alleviating the rising cost of living, just ahead of the nation’s Independence Day. These initiatives—spearheaded by Prime Minister Datuk Seri Anwar Ibrahim—are positioned to directly benefit broad segments of the population, with substantial implications for consumer-facing stocks and the broader economy.
Key highlights include a one-off RM100 cash handout to all adult citizens and a planned reduction in RON95 fuel prices, alongside enhanced subsidies and a freeze on toll hikes. This comprehensive strategy is likely to stimulate private consumption, offering new opportunities for leading Malaysian retailers and consumer brands.

Major “Merdeka” Initiatives: Direct Cash Aid and Subsidy Improvements

• RM100 Sumbangan Asas Rahmah (SARA) Cash Handout: Every Malaysian adult will receive a one-off RM100 cash handout, distributed via their MyKad identification card. This aid can be spent on daily necessities at over 4,100 participating outlets—including major chains like Mydin, Lotus’s, Econsave, and 99SpeedMart—from August 31, 2025, to December 31, 2025.
• Scope and Scale: The initiative is set to benefit 22 million Malaysian adults, with a total allocation of RM2 billion, equivalent to 0.1% of the forecasted 2025 GDP. This pushes the total allocation for the Subangan Tunai Rahmah and SARA schemes to a record RM15 billion for 2025 (up from RM10 billion in 2024).
• RON95 Fuel Subsidy Rationalisation: The government plans to lower the RON95 pump price from RM2.05/litre to RM1.99/litre for the masses. This move will be funded by excluding higher income earners and foreigners from the subsidy, compelling them to pay market rates. The strategy also anticipates reduced RON95 smuggling, mirroring the success seen after diesel subsidy retargeting in 2024.
• Additional Supportive Measures:
  • Doubling the allocation for Madani Rahmah Sales to RM600 million, expanding both reach and access to discounted daily essentials.
  • Freezing scheduled toll rate increases on 10 highways at a cost of RM500 million in government compensation to concessionaires.

Positive Impacts: Stimulating Private Consumption

The newly announced measures are positioned to significantly bolster private consumption, which is forecast to grow by 5.5% year-on-year in 2025. These policies build on other recent government actions—such as the flexible EPF Account 3 (introduced in May 2024), civil servant salary increases (slated for December 2024 and January 2026), and a minimum wage hike (coming February 2025).
With a broad base of Malaysians receiving targeted support, both consumer staples and discretionary sectors stand to gain. The RM100 SARA handout, in particular, is expected to drive higher footfall and sales at participating retailers, while improved disposable income should have a positive spillover effect across the consumer sector.

Company-by-Company Analysis: Who Stands to Benefit?

99 Speed Mart Retail Holdings

• Rating: HOLD
• Target Price: RM2.30
• Current Price: RM2.34
• Network: 2,833 outlets nationwide—Malaysia’s largest mini-market chain.
• Key Insights: With most of its product range eligible under the RM100 SARA cash handout, 99 Speed Mart is a direct beneficiary of the scheme. The chain’s extensive reach ensures broad participation, though there remains some uncertainty about the inclusion of all outlets in the program. Increased customer traffic is also likely to lift sales of items outside the necessity category, offering incremental revenue opportunities.

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

• Rating: ADD
• Target Price: RM2.09
• Current Price: RM1.64
• Retail Focus: One of Malaysia’s largest retailers for household cleaning products, personal hygiene items, and school supplies—all eligible under the SARA scheme.
• Key Insights: Management confirms MRDIY’s participation in the RM100 SARA initiative in select outlets. The anticipated surge in customer visits is expected to boost both necessity and discretionary product sales, reinforcing MRDIY’s position as a leading beneficiary of the government’s cash aid strategy.

Mynews Holdings Berhad

• Rating: ADD
• Target Price: RM0.75
• Current Price: RM0.535
• Retail Presence: Operates a wide range of MyNews and CU stores, catering to everyday consumer needs.
• Key Insights: Mynews is poised to benefit from increased consumer spending power, as the RM100 SARA initiative and other government measures drive higher discretionary and staple purchases. The company’s diverse retail footprint positions it well to capture incremental demand.

Other Beneficiaries: 7-Eleven and F&N

• 7-Eleven and Fraser & Neave (F&N): Both companies stand to gain from the positive spillover effects of higher disposable income and mass-market reach. The government’s continued support for consumer spending is likely to translate into stronger sales for these brands as well.

Broader Financial Outlook and Historical Context

• Record Allocation for Cash Aid: The government’s commitment to broad-based cash assistance has reached new heights, with the combined Subangan Tunai Rahmah and SARA programs totaling RM15 billion in 2025—up from RM10 billion in 2024 and significantly higher than previous years.
• Supporting Chart: Annual Allocation for Broad-Based Cash Aid (RM bn)

Conclusion: Malaysia’s Proactive Consumer Policy Sets the Stage for Market Growth

Malaysia’s latest measures underscore a decisive and targeted approach to supporting private consumption and mitigating the impact of rising living costs. The RM100 SARA cash handout, reduced RON95 fuel prices, and additional subsidies are set to drive significant consumer demand, especially among mass-market retailers and consumer brands.
Key players such as 99 Speed Mart, MRDIY, Mynews, 7-Eleven, and F&N are poised to benefit directly and indirectly from these initiatives. The record allocation for cash assistance programs signals the government’s commitment to sustaining economic momentum and supporting the rakyat.
With private consumption expected to expand robustly in 2025 and a landscape of supportive policies, Malaysia’s consumer sector offers compelling opportunities for investors seeking exposure to resilient and growth-oriented markets.

About the Analysts

• Jeremy Goh, CFA – [email protected]
• Lew Cheng Wei – [email protected]

Stock Ratings Framework

• Add: Total return expected to exceed 10% over the next 12 months.
• Hold: Total return expected to be between 0% and +10% over the next 12 months.
• Reduce: Total return expected to fall below 0% over the next 12 months.

Distribution of Stock Ratings (as of June 30, 2025)

Coverage: 561 companies (quarter ended June 30, 2025)