UNCERTAINTIES surrounding a potential new law to prohibit smoking and the sale of tobacco products to anyone born after 2005, in a move dubbed the “generational endgame”, may continue to weigh on British American Tobacco (Malaysia) Bhd (BAT Malaysia) in the short term, say analysts. Its share price has fallen 6% since Health Minister Khairy Jamaluddin announced on Feb 17 that the government was looking to implement this law in Malaysia. The stock closed at RM11.82 last Wednesday, giving the company a market capitalisation of RM3.37 billion.
Heineken Malaysia Bhd has emerged as the top gainer at mid-morning on Thursday (Feb 17) after its net profit for the fourth quarter ended Dec 31, 2021 (4QFY21) surged 76.93% to RM95.85 million from RM54.17 million a year ago, and it proposed a final dividend of 66 sen per share.
Hong Leong Investment Bank (HLIB) Research and Kenanga Research expect further challenges for British American Tobacco (Malaysia) Bhd (BAT Malaysia) in light of the proposal to ban all types of cigarette products for those born after 2005 (a generation smoking ban), as well as renewed illegal activities as a result of the proposed ban.