[%Exky%]
Research by Kenanga
Outperform - TP RM0.81

"Bracing For Water Piping Boom"

ENGTEX’s 1HFY24 results disappointed. This was no thanks to weak sales in 2QFY24 compounded by higher-cost inventory that
reared its ugly head again in the quarter. We cut our FY24F earnings by 31% but still expecting a stronger showing in 2HFY24 as the recent water tariff hikes allow water operators to kick start the long overdue water projects including pipe replacement. The sentiment towards water-related stocks has improved, and we keep our TP of RM0.81 which commensurate with previous up-cycle valuations, and leave our OUTPERFORM call unchanged.

Analyst:
Nigel Ng 
[%vGYB%]

$KLSE-ENGTEX
Research by Kenanga
Outperform - TP RM0.81

"Bracing For Water Piping Boom"

ENGTEX’s 1HFY24 results disappointed. This was no thanks to weak sales in 2QFY24 compounded by higher-cost inventory that
reared its ugly head again in the quarter. We cut our FY24F earnings by 31% but still expecting a stronger showing in 2HFY24 as the recent water tariff hikes allow water operators to kick start the long overdue water projects including pipe replacement. The sentiment towards water-related stocks has improved, and we keep our TP of RM0.81 which commensurate with previous up-cycle valuations, and leave our OUTPERFORM call unchanged.

Analyst:
Nigel Ng 
nigel@kenanga.com.my