KUALA LUMPUR (May 6): AMMB Holdings Bhd (KL:AMBANK) could be included in the 30-stock FBM KLCI to replace Hong Leong Financial Group Bhd (KL:HLFG), according to CIMB Securities.

This is mainly because HLFG may fail the liquidity screening test, which requires a monthly median trading velocity of at least 0.04% in eight out of the past 12 months — a threshold it would not meet unless it hits the 0.04% mark in May 2025.

To remain in the KLCI during the semi-annual review, existing constituents must meet all three criteria, namely the market capitalisation ranking, minimum free float of 15%, and liquidity screening. The liquidity screen assesses the median daily trading volume as a percentage of shares in issue over a 12-month review period.

For existing constituents, a stock must maintain a monthly median daily trading volume of at least 0.04% of its shares in issue (after applying any investability weightings) in at least eight out of the past 12 months.

AMMB was the highest-ranked non-KLCI stock by market capitalisation at RM17.25 billion as of Monday, May 5, making it the 29th largest stock. It also meets the minimum 15% free float requirement and has fulfilled the liquidity criteria, with a monthly median trading velocity of at least 0.05% over the past 11 months.

After being removed from the KLCI a year ago, AMMB was placed on the reserve list. At that time, Sunway Bhd (KL:SUNWAY) made it to become one of the top 30 stocks following a surge in its share price.

Changes to the 30-stock KLCI will take effect on June 23, with the review date set for May 26. CIMB Securities in a note expects the preliminary results of the KLCI review by FTSE and Bursa Malaysia to be released on June 4, a day ahead of the official announcement on June 5.

Since the last review on Nov 25, 2024, YTL Power International Bhd (KL:YTLPOWR), Petronas Dagangan Bhd (KL:PETDAG), and YTL Corp Bhd (KL:YTL) have seen the biggest gains of 14.8%, 10.4% and 8.2% respectively in market capitalisation among KLCI constituents.

In contrast, Petronas Chemicals Group Bhd (KL:PCHEM), CIMB Group Holdings Bhd (KL:CIMB), and Axiata Group Bhd (KL:AXIATA) have recorded the steepest declines of 28.1%, 15.3% and 10.3% respectively.

As of April 30, the banking sector made up the largest share of the KLCI at 40.9%, followed by utilities at 16.6% and telecommunications at 9.9%.

The KLCI remained steady above the 1,500-point mark, closing at 1,536.8 points on Tuesday, recovering from the recent low of 1,400.59 points on April 9, after the US paused tariffs for negotiations. The benchmark index has, however, fallen 0.18% year-to-date.