The country will raise the minimum wage level to RM1,700 (US$395) in February, from RM1,500, and set aside RM13 billion for poorer Malaysians, Prime Minister Datuk Seri Anwar Ibrahim said in his budget speech on Friday (Oct 18). The government plans to trim petrol subsidies from mid-2025, to dial back its subsidies and social assistance bill by 14.4% next year.
Other measures announced include allocations to boost the tourism sector and facilitate energy transition.
Here’s a look at some of the key winners and losers of the budget for 2025:
Winners
Consumption
A higher minimum wage and targeted aid, coupled with an earlier broad pay-hike for civil servants, would raise disposable income for consumers. That should benefit retailers, such as 99 Speed Mart Retail Holdings Bhd (KL:99SMART). and MR DIY Group (M) Bhd (KL:MRDIY).
Energy firms
The government announced a RM300 million allocation as part of its energy transition plan to achieve net-zero goal by 2050. That’s triple the RM100 million set aside for this year.
This is set to benefit companies involved in developing large-scale solar fields, such as UEM Sunrise Bhd (KL:UEMS) and SD Guthrie Bhd (KL:SDG); as well as grid operators, such as Tenaga Nasional Bhd (KL:TENAGA).
Tourism
Malaysia is setting aside RM550 million to promote tourism, ahead of its Visit Malaysia Year in 2026. Entertainment and gaming companies, such as Genting Bhd (KL:GENTING); and airline operator AirAsia X Bhd (KL:AAX) may benefit from a boost in tourism receipts.
Palm oil planters
The government’s plan to increase the threshold on profit in which palm oil companies have to pay a windfall tax, will positively impact earnings of major planters, such as SD Guthrie, IOI Corporation Bhd (KL:IOICORP). and Kuala Lumpur Kepong Bhd (KL:KLK).
Losers
Beverage makers
Malaysia will increase its excise duty on sugary beverages by 40 sen per litre starting Jan 1, 2025, adding on to the sugar tax that was increased under Budget 2024. That may raise the cost for companies, such as Nestle (M) Bhd (KL:NESTLE) and Fraser & Neave Holdings Bhd (KL:F&N).
Steel producers
Anwar announced that a carbon tax will be imposed on the steel-making industry in 2026, which may impact producers, such as Southern Steel Bhd (KL:SSTEEL).
Click here for all you need to know about Malaysia's Budget 2025.
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