BERMAZ AUTO BERHAD Faces Historic Low Amid Stalled Growth

Bermaz Auto Bhd (KL: BAUTO) has fallen to a new all‑time low on Friday, trading at MYR 0.69, a 31‑day decline that underscores the mounting pressure on the company’s profitability and market share. The dip follows a series of quarterly results that have highlighted a persistent erosion in revenue and gross margins, coupled with an intensifying competitive landscape dominated by low‑priced Chinese automotive imports.

Quarterly Performance Highlights

  • First‑quarter profit collapse – For the period ending 31 July 2025 (FY 2026 Q1), the company reported a net loss of MYR 8.28 million, a decline of 88.2 % from MYR 70.22 million in the same period last year. The profit slide is the sharpest in five years and reflects a sharp drop in revenue from MYR 846.18 million to MYR 491.28 million, a 41.9 % year‑over‑year fall.
  • Revenue‑driven decline – The revenue contraction is largely attributable to reduced sales of domestic Mazda and Kia models whose product life cycles are nearing termination. In addition, the influx of competitively priced Chinese vehicles has further eroded demand for the company’s offerings.
  • Dividend decision amid distress – Despite the earnings slide, the board declared a MYR 0.75‑per‑share interim dividend, signalling an attempt to maintain investor confidence while acknowledging the short‑term challenges.

Market Sentiment and Analyst Outlook

The market reaction has been swift. Two analysts have moved BAUTO to a “sell” rating, and the consensus earnings forecast for the full year has been trimmed sharply after the company’s quarterly profit accounted for only 5 % of the initial consensus. The company’s share price, which had briefly rebounded from a low of MYR 0.67 earlier in the day, was pushed back to the historical minimum following the earnings announcement.

Strategic Response and Product Pipeline

Bermaz Auto has begun to address the product‑cycle issue by launching two new Mazda models— the CX‑60 and the CX‑80 PHEV— intended to bridge the gap until the next generation of vehicles arrives. These models have already garnered positive consumer reception in early market tests, suggesting that the company’s product strategy may start to mitigate the current sales slump.

However, the company’s forward‑looking outlook remains cautious. Management has warned that inflationary pressures, geopolitical uncertainties, and a muted global growth environment will continue to constrain the Malaysian economy, thereby dampening automotive demand. The company is also grappling with losses from its joint‑venture operations, which further compress overall profitability.

Key Takeaways

  1. Record Low Stock Price – The share price drop to MYR 0.69 marks a new low, reflecting investor concern over the company’s deteriorating financials.
  2. Profitability Crisis – An 88 % plunge in Q1 profit, coupled with a 42 % revenue decline, highlights a significant operational challenge.
  3. Competitive Pressures – The aggressive pricing tactics of Chinese automakers are accelerating the decline in demand for Bermaz Auto’s existing model lineup.
  4. Strategic Product Refresh – New Mazda models are being introduced to stave off the impact of product‑cycle attrition.
  5. Cautious Outlook – Management forecasts a difficult year ahead, with inflation and geopolitical factors expected to limit growth.

In light of these developments, stakeholders should monitor Bermaz Auto’s ability to execute its product refresh strategy, control costs, and navigate the competitive pressures that currently undermine its financial performance.