CIMB Investment Bank Bhd (CIMB Securities) maintained its NEUTRAL view on the consumer sector for the second half of 2026, expecting more cautious consumer spending behaviour amid inflationary pressures and macroeconomic uncertainties.
The research house favoured defensive, mass-market names including QL Resources Bhd, Empire Premium Food Bhd and Life Water Bhd.
CIMB Securities expects consumer sector sales momentum to soften in the third quarter of 2026 as festive-driven spending was largely brought forward into the first quarter, before recovering in the fourth quarter on year-end and festive demand.
The research house said consumers are likely to remain selective, with spending focused on daily essentials and value-for-money purchases while discretionary categories could face weaker demand. It added that government support through the RM15 billion Sumbangan Tunai Rahmah (STR) and Sumbangan Asas Rahmah (SARA) allocation in 2026 should continue supporting essential goods spending.
However, CIMB Securities expects the boost from cash assistance to moderate in the second half of 2026 as the programme enters a higher-base phase following wider SARA utilisation.
On costs, the research house said consumer companies have avoided broad-based shortages of key inputs despite recent geopolitical tensions. It expects firms to manage cost pressures through selective price adjustments, better product mix and tighter cost controls rather than broad-based price increases.
CIMB Securities noted the consumer sector is trading at 27.7 times one-year forward price-to-earnings, around one standard deviation below its five-year mean of 30.5 times. The valuation discount reflects softer sentiment, slower earnings momentum and persistent cost pressures.
The research house added that tourism could provide further support, with Malaysia recording 10.6 million foreign tourist arrivals in the first quarter of 2026, though travel risks from geopolitical uncertainties and higher airfares remain.
