CGS International lifts KLCI 2026 target to 1,810 on ringgit strength
CGS International Securities Malaysia Sdn Bhd raised its end-2026 FBM KLCI target to 1,810 from a prior forecast, citing a stronger ringgit and clearer trade policy.
Source: Bernama · August 24, 2026 at 1:30 PM · AI-assisted report
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KUALA LUMPUR, 24 AUGUST 2026 —
KUALA LUMPUR, 1 July 2026 – CGS International Securities Malaysia Sdn Bhd has reiterated a bullish outlook for Malaysia’s economy, setting an end‑2026 Kuala Lumpur Composite Index (KLCI) target of 1,810. The forecast is underpinned by a strengthening ringgit, easing trade tensions and supportive policy measures.
Market Impact
CGS International’s chief executive officer, Khairi Shahrin Arief Baki, highlighted that a firmer ringgit has improved gross margins for corporates reliant on imported inputs and reduced interest costs for those with foreign‑currency borrowings. He added that the currency’s appreciation has also bolstered consumer sentiment.
“Trade tensions have eased, and with greater certainty comes greater willingness to invest, which should benefit both corporates and consumers,” Baki said at the opening of the firm’s 18th Annual Malaysia Corporate Day. The research team projects an 8.5 % rise in earnings for companies within its coverage and a KLCI level of 1,810 by the end of 2026.
The firm’s outlook is rooted in a broader assessment of Malaysia’s economic trajectory. Baki noted that 85 % of the companies under CGS International’s coverage are domestic‑focused, positioning them to benefit from a stronger ringgit that lowers operating costs and supports profitability. He also cited the government’s proactive policy environment, which includes initiatives to attract foreign investment and stimulate employment.
“We also look at how the government has not just put in policies, but also made an effort in bringing business into Malaysia, which helps to boost the economy and employment,” Baki added.
Prem Jearajasingam, CGS International’s head of research, provided a currency outlook, expecting the ringgit to strengthen to 4.00 against the U.S. dollar in the near term before retreating to around 4.10 amid market volatility. “There is still volatility in the currency market – the ringgit went to 4.03 and now we are seeing it at about 4.07 versus the greenback,” Jearajasingam said.
He emphasized that short‑term moves are difficult to predict, so the firm focuses on average rates rather than pinpointing a specific level.
The Malaysian market is likely to feel the impact of these developments across several sectors. A stronger ringgit is expected to benefit manufacturing and export‑oriented firms by reducing input costs and improving competitiveness. Conversely, sectors heavily reliant on imported raw materials may see cost advantages that translate into higher margins. The positive earnings outlook for listed companies, driven by improved operating conditions and consumer confidence, could support broader market gains and reinforce the KLCI target.
Looking ahead, CGS International remains cautiously optimistic. The firm’s projections hinge on sustained currency strength, continued easing of global trade frictions, and the effectiveness of domestic policy measures. While short‑term volatility remains a concern, the consensus among the research team is that the combination of a ringgit, supportive fiscal and monetary policy, and a resilient corporate sector will underpin Malaysia’s economic growth through 2026 and beyond.
Related: Kuala Lumpur