KUALA LUMPUR (Feb 11): MSCI maintained the constituents of its main country index for Malaysia, while deleting four stocks from its small-cap index following its latest review.

The indices are closely watched by fund managers and international investors. An exclusion from the indices can trigger outflows as passive investors sell the former constituent in their portfolios to mirror the benchmarks.

CTOS Digital Bhd (KL:CTOS), Guan Chong Bhd (KL:GCB), Malaysian Resources Corporation Bhd (KL:MRCB), and VS Industry Bhd (KL:VS) will be removed from MSCI’s small-cap index. Property developer KSL Holdings Bhd (KL:KSL) will be added to the index that tracks small firms on Bursa Malaysia.

All changes to the MSCI indices will be effective at the close of Feb 27, 2026, the index provider said. The next review announcement has been scheduled for May 12, 2026.

MSCI indices are rebalanced every three months on the final trading day of the quarter. MSCI will add or remove stocks based on specific criteria such as size and liquidity to ensure the indices stay relevant as benchmarks of the markets they represent.

CTOS lost nearly one-third of its market value in 2025 after missing analyst estimates amid prolonged vacuum at the top management. The credit scoring firm has since filled the positions of its chief executive officer and chief financial officer near the end of last year.

Johor-based KSL Holdings, meanwhile, surged 77% as investors scrambled for a piece of the action in the property sector benefitting from the Rapid Transit System project and the Johor-Singapore Special Economic Zone (JS-SEZ).

Among the developers, KSL Holdings stands out as a key beneficiary as more than half of its landbank is located in Johor Bahru, Asia Analytica wrote in a note on Dec 18, 2024.

Malaysia currently has 27 constituents that cover about 85% of the country’s equity universe in MSCI’s standard index designed to measure the performance of the large- and mid-cap stocks. The small-cap index, meanwhile, has more than 60 stocks that make up about 14% of Bursa Malaysia.