Full spectrum of auto offering by Sime Darby after UMW takeover
By THE STAR | 12 February 2024![](https://da4dkroembtou.cloudfront.net/wp-content/uploads/2024/02/file7etl4t76bp05wjeibnz.jpg)
PETALING JAYA: Sime Darby Bhd’s takeover of UMW Holdings Bhd has positioned the group with a full spectrum of auto offering in the local automotive market.
According to Kenanga Research, Sime Darby has now expanded its presence in the mid-market and affordable segments, from its previous predominantly premium offerings.
“This puts it (Sime Darby) in a better position to navigate the impending fuel subsidy rationalisation,” said the research firm in a note to clients.
Kenanga Research, which maintained an “outperform” call on the stock, has raised its target price by 14% to RM2.80 from RM2.45 previously.
It also raised the group’s financial year 2024 (FY24) and FY25 net profit by 2% and 14%, respectively, on earnings enhancement from the acquisition.
“We like Sime Darby for the robust growth in its businesses, post-economic reopening, the strong brands under its stable such as BMW, Caterpillar, Toyota and Perodua as well as its attractive dividend yield of over 5%,” said Kenanga Research.
Upon the conclusion of Sime Darby’s takeover of UMW in February 2024, the group’s presence in the local automotive market will be expanded to the mid-market segment such as Toyota and affordable segment such as Perodua, from the predominantly premium offerings such as BMW.
“Moreover, Sime Darby will likely benefit from the anticipated new launches of Perodua D66B and Toyota Yaris Cross by April,” it added.
Post-acquisition, by virtue of having well known marques namely Toyota and Perodua under UMW, Kenanga Research expects Sime Darby’s market share in the local automotive total industry volume (TIV) will surge to over 50% from 3% previously.
It added that UMW provides access to the massive Toyota ecosystem, a strong high-value supply chain and will enhance Sime Darby’s local market exposure.
Geographically, Sime Darby will have equal exposure to Malaysia, China and Australia, with the remaining 10% in other markets versus being predominantly in China previously.
Tags
Autos News
Reviews
![](https://da4dkroembtou.cloudfront.net/wp-content/uploads/2024/07/2024-Hyundai-Tucson-1-6T-Max-1-300x202.jpg)
7.6
Hyundai Tucson 1.6T Max: Punchy powertrain, roomy, premium c...
![](https://da4dkroembtou.cloudfront.net/wp-content/uploads/2024/07/Royal_Enfield_Shotgun_650_1-300x200.jpeg)
6.4
Royal Enfield Shotgun 650: Aiming at the sweet spot
![](https://da4dkroembtou.cloudfront.net/wp-content/uploads/2024/07/2024-07-16-15_04_16-Window-300x190.jpg)
8.0
Mercedes-Benz S 580 e: Plug in to hybrid luxury
![](https://da4dkroembtou.cloudfront.net/wp-content/uploads/2024/07/Chery_Tiggo_9_A-300x200.jpeg)
Chery Tiggo 9 PHEV: A jaw-dropping juggernaut
![](https://da4dkroembtou.cloudfront.net/wp-content/uploads/2024/07/HD_Street_Glide_1-300x199.jpeg)
8.2
Harley-Davidson Street Glide: Slick and comfortable tourer
![](https://da4dkroembtou.cloudfront.net/wp-content/uploads/2024/07/iPhone_0X3A1416-Custom-300x200.jpg)
8.2
Chery Omoda E5: Premium features, 430km range (WLTP)
![](https://da4dkroembtou.cloudfront.net/wp-content/uploads/2024/07/GWM_Ora_07_1-300x200.jpeg)
GWM Ora 07 Performance: Juiced up and ready to go
![](https://da4dkroembtou.cloudfront.net/wp-content/uploads/2024/07/Triumph_Speed_400_A-300x200.jpeg)
6.8
Triumph Speed 400: Fun and easy on the wallet
Videos
![](https://i.ytimg.com/vi/V4OFuw8vpBc/mqdefault.jpg)
Double take: Electric Porsche Macan RWD and Macan 4S add div...
![](https://i.ytimg.com/vi/EqpdLT8QhmQ/mqdefault.jpg)
New Porsche Panamera blazes record time on Nürburgring
![](https://i.ytimg.com/vi/yXgsalFl7uE/mqdefault.jpg)
Maserati's Exclusive Electric GranCabrio Celebrates 50 Years...
![](https://i.ytimg.com/vi/KYkcy37pD-s/mqdefault.jpg)