RHB Investment Bank Bhd maintained its target price for Bursa Malaysia Bhd at RM9.70 as Bursa Malaysia's trading activity is expected to remain strong this year, driven by continued retail participation and sector-to-cycle rotation.
The investment bank was quoted by Bernama as saying that the average daily value of securities (SADV) and the average daily value of exchange derivatives (DADV) would remain high in 2021, although moderate from last year, retail participation remained strong and sector turnover to the cycle sector maintain trading.
“Our SADV expectation in 2021 of RM3.15 million assumes a normal 26% year-on-year normalization from 2020, but still higher than the pre-Covid-19 trading level, which is 30% higher than the SADV average in 2017-2019, ”He explained in today's research note.
Bursa Malaysia ended the first trading week of 2021 with SADV of RM5.36 billion with a total trading value of RM26.79 billion.
RHB Investment Bank estimates total trading value and SADV in the fourth quarter of 2020, remaining strong at RM319 billion and RM4.98 billion, respectively.
"Although SADV declined 14% quarter-on-quarter compared to higher levels in the third quarter, Bursa Malaysia still recorded 143% year-on-year growth, rejecting concerns about a lack of liquidity, especially among retail investors after the moratorium," he said.
