Tayyib Alternatives to This Malaysian Stock That Deserves to Be on the BDS List
Muslim investors ought to drop Sime Darby, a top-tier Caterpillar dealer, that is profiting off a genocide.
Israel is openly genocidal about Gaza. Yet, the world continues to look the other way. The incapacity of the Arab League and the Muslim ummah at large to properly counteract the zionist agenda pours salt into the gaping Palestinian wound.
But when governments fail to act, people really need to step up.
Consider the case of Malaysia's Sime Darby that makes over a third of its revenue from distributing Caterpillar’s murder machines, long used by the Israeli military against the civilian population in both Gaza and the West Bank. The enduring relationship with the criminal American corporation has not faltered even through the height of Israel’s genocidal mission since late 2023.
Muslim investors, in Malaysia and elsewhere, are under a moral obligation to divest from Sime Darby, a purportedly halal stock. There are plenty of genuinely tayyib alternatives that are untainted by complicity in Israel’s crimes against humanity.
‘Halal’ only in name: Sime Darby Berhad
With a market cap of USD2.7bn, Sime Darby (KLSE:SIME) is one of Malaysia’s largest consumer conglomerates. Its biggest and most consequential Industrial segment contributes close to half of the group revenue (45% of USD10.7bn in FY2024). And that is precisely the business that distributes the culpable Caterpillar equipment across Asia Pacific.
Even as Caterpillar (NYSE:CAT) faces weakening demand and eroding margins amid growing competition, Sime Darby remains a devoted ally. Not only that: the criminal association has recently expanded, with a buyout of Cavpower in Australia in 2023. Though this has not helped reverse the negative trend in Sime Darby’s own performance.
Divestment imperative
Civil societies like BDS Malaysia have been calling on Permodalan Nasional Berhad (PNB), a state-owned fund manager and the biggest shareholder in Sime Darby with a 44% stake, to break the unethical partnership. So far, those pleas have fallen on deaf ears.
What then conscionable people ought to do? If you are a consumer based in Southeast Asia, you can avoid buying the brands Sime Darby represents. These happen to include Hyundai whose heavy machinery has been used by Israel in house demolitions and destruction of agriculture and water structures throughout occupied Palestine.
If you are an investor, take a page from institutions, like Norway’s KLP Pension Fund, that have divested from Caterpillar and other complicit companies. Retail investors hold 16.3% of Sime Darby’s shares, altogether valued at USD440mn. It may not seem like much but it sends a message — that the public does not wish to profit from violence and occupation. Such individual initiative just might spur PNB to action.
Muslim investors, in particular, should question whether Sime Darby truly qualifies as a halal stock. After all, Shariah compliance is not simply about fulfilling a few financial requirements but a more holistic conformity with fundamental human values, social justice included.
Tayyib alternatives
Thankfully, the Malaysian stock market — 80% of which is Shariah compliant — has loads more to offer to Muslim investors. The table below is made up of prominent growth and dividend plays from sectors that correspond to Sime Darby’s past and current businesses, namely Industrials, Materials, Construction, Infrastructure and Automotive.
Press Metal Aluminium Holdings is Southeast Asia’s largest aluminium smelter and a leading industrial materials company in Malaysia. It achieved a record net profit of MYR1.76bn (up 45%) in 2024 and continued to grow in 1Q 2025 (13%). Dividend yield is modest at 1.6%, but there is a track record of increasing payouts.
Gamuda Bhd is one of Malaysia’s foremost infrastructure groups, with a record-high order book of MYR30bn and significant overseas exposure. In the most recent quarter, revenue jumped 47% year-on-year, driven by strong construction activity both locally and abroad. Dividend yield is a stable 2.7%.
IJM Corporation Bhd is a top-tier diversified group in Malaysia with operations in property, industry and ports. Profit before tax nearly doubled and revenue went up 30% in FY2024, thanks to a healthy order book and strong performance from the industry division. Dividend is a solid 3.3%.
Sunway Construction Group Bhd is a big pure-play construction company. The group posted record-high revenue and profit before tax in FY2024, with revenue up 28% and profit before tax 53%, reflecting robust performance across segments. Dividend is small but steady.
Bermaz Auto Bhd is an automotive distributor in Malaysia, best known for Mazda, Kia and Peugeot. For the six months ended October 2024, revenue and profit before tax declined by 28% and 41% respectively, due to increased competition, but the company has maintained very high dividends.
MBM Resources Bhd is a key automotive group and the main listed proxy for Perodua, Malaysia’s top-selling car brand. In 2024, it reported steady revenue growth and improved profitability, outperforming the industry’s total vehicle sales growth. Dividend yield is a generous 7.9%.
Hong Leong Industries Bhd is a major player in Malaysia’s automotive sector, specifically in Yamaha motorcycles and auto parts. Despite a 9% drop in FY2024 revenue due to softer motorcycle demand, profit before tax rose 29% owing to a better sales mix and operational efficiency. Total dividend yielded 4.6%.
DRB-HICOM Bhd is a diversified conglomerate and the controlling shareholder of Proton, Malaysia’s original national car maker. In FY2024, its revenue rose 2%, but net profit fell sharply due to higher costs and lower auto margins. With new Proton EV launches, the group remains optimistic about its automotive business.
Muslim investors all of sizes must join the divestment movement against zionist Israel and contribute to BDS becoming a powerful force for justice, in Palestine and beyond. Making investment returns in tayyib ways is perfectly possible and the only acceptable option. Willing silence in support of the indefensible status quo is not.