Maybank IB places Bermaz Auto above-average as per its ESG assessment as the company stands out in several “S” and “G” initiatives, with robust CSR activities and an established governance framework supported by policies aligned with international standards. BAuto scores 57 (out of 100) in the latest assessment vs. 65 in the assessment in Sep 2022.
The house said it is keenly watching BAuto’s transition to EV, which would be critical for the next phase of growth. Maybank IB maintains its earnings forecasts and MYR3.48 TP, based on an unchanged 12x FY25E PER. BAuto excels in several “S” and “G” initiatives, notably robust CSR activities under “S”, such as EV training workshops conducted via BAuto Training School (BTS) to help improve youth unemployment. In terms of “G”, BAuto has established a strong governance framework supported by various policies including a Board Charter, Code of Conduct and Business Ethics, Whistleblowing Policy and Procedure, Anti-Bribery and Corruption Policy, and Fit and Proper Policy, to name a few. These practices align with the three key principles of good corporate governance outlined in the
Malaysian Code on Corporate Governance (MCCG)
Areas for improvement
On the flip side, areas for improvement include its EV sales contribution, which the house anticipates will accelerate with BAuto securing distributorship of XPeng, a leading smart EV car manufactured in China. Additionally, there is a downward trend in women’s participation in top management roles.
Remain positive on robust fundamental
Maybank IB said it will continue to favor BAuto for its robust fundamentals, resilient financials (solid net cash, strong FCF from asset-light model), and appealing >8% dividend yield. BAuto remains optimistic about its vehicle sales target,
anticipating sustained growth into FY25E (25.8k units; +8% YoY), driven by a robust pipeline of new launches, an expanding CKD mix, and a strategic focus on niche markets with higher-margin models
