[%LEoz%] 
Research by HLIB
HOLD – TP RM 0.83

" Heightened competition”

SLP reported 1HFY24 core PAT of RM8.2m (+25.5%), which came in within our and consensus expectations. The quarter saw lower GP margin due to heightened competition in the local packaging industry, leading to a downward revision in ASP. While the appreciation of JPY against USD is expected to enhance its sales outlook in the Japanese market, the limited availability of shipping containers in SEA could constrain the recovery. Prolonged logistical issues may also lead to further shifts in the local market, affecting local sales. In light of the recent weakness in share price, we upgrade SLP to HOLD (from Sell), with an unchanged target price of RM0.83, as the risk-reward profile has now become more balanced.

Analyst:
Sam Jun Kit
[%RkhZ%]

$KLSE-SLP 
Research by HLIB
HOLD – TP RM 0.83

" Heightened competition”

SLP reported 1HFY24 core PAT of RM8.2m (+25.5%), which came in within our and consensus expectations. The quarter saw lower GP margin due to heightened competition in the local packaging industry, leading to a downward revision in ASP. While the appreciation of JPY against USD is expected to enhance its sales outlook in the Japanese market, the limited availability of shipping containers in SEA could constrain the recovery. Prolonged logistical issues may also lead to further shifts in the local market, affecting local sales. In light of the recent weakness in share price, we upgrade SLP to HOLD (from Sell), with an unchanged target price of RM0.83, as the risk-reward profile has now become more balanced.

Analyst:
Sam Jun Kit
jksam@hlib.hongleong.com.my