[%lDqQ%] 
Research by HLIB
Hold – TP of MYR 0.33

“Impacted by higher opex” 

Hevea recorded 1Q24 core net profit of RM392k (QoQ: -93%; 1Q23: -RM7.3m), which came in below our expectation, making up 10.1% of our full year forecast. The negative deviation was due to higher-than-expected operating expenses. We cut our FY24/25 forecasts by -12.8%/-6.1% to account for higher opex. Despite revenue seeing improvement over the past few quarters, Hevea’s operating expenses have been increasing as well attributed largely to operational hiccups at its RTA segment as it pivots to a changing business landscape. The demand for the group’s products in the near-term remains uncertain due to the challenging economy from its main export market of Japan. Maintain HOLD with an unchanged TP of RM0.33 based on 0.45x P/B of its FY25 BVPS of RM0.73.

Analyst(s):
Tan Je Jyne
[%RaLf%]

$KLSE-HEVEA 
Research by HLIB
Hold – TP of MYR 0.33

“Impacted by higher opex” 

Hevea recorded 1Q24 core net profit of RM392k (QoQ: -93%; 1Q23: -RM7.3m), which came in below our expectation, making up 10.1% of our full year forecast. The negative deviation was due to higher-than-expected operating expenses. We cut our FY24/25 forecasts by -12.8%/-6.1% to account for higher opex. Despite revenue seeing improvement over the past few quarters, Hevea’s operating expenses have been increasing as well attributed largely to operational hiccups at its RTA segment as it pivots to a changing business landscape. The demand for the group’s products in the near-term remains uncertain due to the challenging economy from its main export market of Japan. Maintain HOLD with an unchanged TP of RM0.33 based on 0.45x P/B of its FY25 BVPS of RM0.73.

Analyst(s):
Tan Je Jyne
jjtan@hlib.hongleong.com.my