Industry experts gave their stock picks for 2024. I dissect their thesis and give my honest opinion. (Link here)

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Gamuda (MIDF)

Strong overseas expansion and consistency in getting jobs. High order book of RM26 billion for the next three years. Projected involvement in MRT3, Penang LRT and Pan Borneo Sabah.

My opinion: I think this is a ‘safe’ pick from the experts. Gamuda has been and will always be a key player in the construction sector. It has already proven its track record with MRT1 and MRT2. There is no doubt in my mind that infrastructure will be key for the government and Gamuda will still be in the driver’s seat.

Yinson (Areca Capital)

Top 5 player in the floating, production, storage and offloading (FPSO) oil & gas industry. Cheap valuations. The huge order book of US$22 billion for the future. Well-positioned for the green technology trend.

My opinion: I think Yinson is attractive for its low valuations. But it all depends on its transition to green energy. Oil & gas is a sunset industry. With electric vehicles hot on everyone’s minds these days, fossil fuel industries will eventually die off. However, it’s probably going to take a while so Yinson is still ok in terms of short-term prospects in the oil & gas industry.

Inari Amerton (RHB)

Various diversification strategies and expansion plans. Potential strong rebound in the semiconductor sector in 2024. One of the largest OSAT service providers.

My opinion: I am generally fine with semi-conductor stocks. There will always be demand for electrical and electronic products. The last cycle was mainly for smartphones. Right now, it is shifting towards the electric vehicle and AI-related industries. However, I do worry about the trade war between the U.S. and China, and how it could affect other E&E companies in the region. Will they have to take sides if a war breaks out?

Farm Fresh (Maybank)

Resilient product demand from consumers shifting to basic food & beverage. Competitive pricing strategy and high product quality. Easing of raw material cost to improve margins.

My opinion: I guess the impression is still strong in Malaysian minds that Farm Fresh is great. Its foray into the ice cream industry is natural and expected. But I think we still need to be aware that the majority of its raw materials are made in Australia – not Malaysia. As much as I want to say this is a home-grown brand, the company is still very much exposed to the ever-changing global commodity markets.