KUALA LUMPUR: Small-cap counters have emerged as standout performers on Bursa Malaysia this year, with a number of lower-priced stocks posting gains which have outpaced the broader market, highlighting growing investor appetite for speculative and turnaround plays.
Analysts say the rally reflects targeted bargain hunting and trading-driven momentum rather than a broad-based market upswing, as investors rotate into cheaper counters supported by turnaround stories or thematic catalysts.
Leading the pack is BCM Alliance Bhd, which has doubled in value year-to-date to 10 sen, marking a 100 per cent surge, with Public Investment Bank Bhd (PublicInvest) placing the counter at the top of the performance table.
Property developer GuocoLand Malaysia Bhd followed with an 81.2 per cent gain to RM1.06, while technology player Globaltec Formation Bhd rose 79.4 per cent to RM1.13. Electronics manufacturer Mikro MSC Bhd also posted a strong showing, climbing 72.9 per cent to 41.5 sen.
Other notable gainers include Nexgram Holdings Bhd, up 66.7 per cent to 25 sen, and defence-related Boustead Heavy Industries Corp Bhd, which advanced 62.5 per cent to 45.5 sen.
Mid-tier performers rounding out the top ten are GO Hub Capital Bhd (57.1 per cent to 93.5 sen), logistics group Knusford Bhd (55.2 per cent to 67.5 sen), and Sorento Capital Bhd, which gained 50 per cent to 70.5 sen.
According to data compiled by PublicInvest, the rally highlights how liquidity flows and sentiment can rapidly reprice smaller companies, particularly when trading volumes spike.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said value investors are constantly on the lookout for undervalued stocks.
"We have seen the FTSE Bursa Malaysia KLCI have made a strong comeback with the index currently hovering above 1,700 points and it seems it might go nearer towards 1,800 points perhaps towards the end of the year," he said.
Afzanizam said in the process, some blue-chip stocks may have risen significantly, prompting investors to look for other counters that still offer potential upside.
"In that sense, it's a healthy trend as the rise in the share prices could be broad based which benefits the investors," he added.
Meanwhile, PublicInvest analyst Lee Siao Ping said trading interest is also picking up in selected small-cap counters, with technical indicators signalling potential upside for healthcare-related Sunzen Biotech Bhd and Marine & General Bhd, as improving momentum points to possible trend reversals.
According to him, both counters are entering technically sensitive zones, where volume expansion and sustained buying pressure will be key determinants of whether anticipated breakouts or reversals materialise.
M&G, which last closed at 18 sen, is seen approaching a critical technical juncture after moving within a sideways channel, he said.
He said chart signals suggest the counter may be poised for a breakout should buying momentum strengthen.
A decisive move above its immediate resistance at 19.5 sen could trigger further gains toward 21 sen, representing potential returns of about 8.3 per cent to 16.6 per cent from the latest close, he said in a note.
"Failure to hold on to the support level of 16.5 sen may indicate weakness in the share price and hence, a cut-loss signal," he said, with 15 sen identified as the risk threshold.
Lee said Sunzen is also showing early signs of reversing its prior downtrend.
"Sunzen appears poised to stage a breakaway from its downtrend, with continued improvement in both momentum and trend anticipated in the near term. Should the immediate resistance level of 27.5 sen be broken with renewed buying interest, it may continue to lift the price higher to the subsequent resistance level of 29.5 sen.
"However, failure to hold on to the support level of 25 sen may indicate weakness in the share price and hence, a cut-loss signal," Lee said.
In a separate note, Rakuten Trade Sdn Bhd said shares of RGB International Bhd are showing signs of a technical recovery after staging a rebound that lifted the stock above its key exponential moving average (EMA) lines, signalling renewed buying interest following an extended 11-month downtrend.
The firm said the emergence of a bullish EMA crossover has strengthened the counter's near-term outlook, indicating improving momentum and a possible shift in trend direction. The stock has also reclaimed the 26.5 sen level, previously a resistance point, which is now seen acting as support – a development typically interpreted as a positive technical signal.
"We believe this zone could act as a near-term accumulation area, as the stock has returned to its early-2024 levels, where stronger demand previously emerged.
"Thus, we expect the upward trajectory to steer the stock higher towards its initial resistance at 28.5 sen (R1), followed by 30 sen (R2)," the firm said.
On the downside, risk management remains crucial. A decline below 25 sen would invalidate the bullish setup and may indicate renewed selling pressure, prompting traders to consider a stop-loss strategy.