The highest dividend yield stock in Msia

As a distributor of Perodua in Malaysia, MBMR is surely a stock to watch as the best selling auto brand in Msia. Yet it might be one of the most underated stock.

1. The group plans to capitalize on Perodua's robust order backlog, exceeding 150,000 units, along with continued substantial new orders projected for 2024.

2. Perodua has increased its 2023 sales forecast to 325,000 units (previously 314,000), supported by an enhanced production goal of 338,000 units (up from 330,000).

3. Perodua anticipates the launch of two more facelift models in the upcoming months.

4. Dealerships for brands like Volvo and Volkswagen are experiencing a decline in demand, leading to more aggressive discount promotions.

5. The group aims to sustain its competitiveness by persisting in process enhancements and cost rationalization measures.

Despite trading at just 5.7x of trailing PE, the dividend yield is as high as 10%. Many might worry about the sustainability of the the dividend payout, but the resilient and stable earnings since 2018 (NP margin at ~8.5%) should clear our doubts.