UNISEM
Unisem (M) Berhad
Company Background
$UNISEM / 5005 (UNISEM (M) BERHAD)
Research by Kenanga
$UNISEM / 5005 (UNISEM (M) BERHAD)
Research by RHB
$UNISEM / 5005 (UNISEM (M) BERHAD)
Research by HLIB
$UNISEM / 5005 (UNISEM (M) BERHAD)
Research by TA Securities
KUALA LUMPUR: Unisem (M) Bhd, which saw its net profit jump 48.5% in the third quarter ended Sept 30 (3Q24), expects its performance to be satisfactory in the next financial quarter.
$UNISEM / 5005 (UNISEM (M) BERHAD)
Research by RHB
$UNISEM / 5005 (UNISEM (M) BERHAD)
Research by TA
Hold – TP RM4.20
“Seeing Gradual Recovery in Sales"
After revising the earnings forecasts, we tweaked the target price lower from RM4.50 to RM4.20, based on a PE multiple of 32.0x CY25F EPS and 3% ESG premium. Maintain a Hold call on UNISEM.
Analyst:
Chan Mun Chun
mcchan@ta.com.my
$UNISEM / 5005 (UNISEM (M) BERHAD)
Research by RHB
Buy – TP RM4.40
“Recovery Underway, Positive Outlook For 2H24; BUY"
MaintainBUYandMYR4.40TP(10%upside),c.2%yield.1H24coreearnings were below expectations, undermined by lower margins from product mix and additional operational costs. Management is cautiously optimistic about 2H24 loadings, backed by higher loadings from automotive customers, new programmes, and supply chain diversification. Despite the earnings miss, we believe a recovery is underway with QoQ improvement and stronger loadings ahead, consistent with the overall sector trajectory. Therefore, we advocate positioning to ride on the new semiconductor cycle on weakness.
Analyst:
Lee Meng Horng
lee.meng.horng@rhbgroup.com
$UNISEM / 5005 (UNISEM (M) BERHAD)
Research by MIDF
Sell – TP RM3.43
“Single-Digit Profit Margin"
• We are downgrading our recommendation to SELL with a slight revision on target price to RM3.43 post the 2QFY24 results
• Sequential improvement seen in 2QFY24 but was unable to lift 1HFY24 earnings higher as compared to 1HFY23
• Ipoh operation to remain a drag to the group in the near-term, leading to thin profit margin
• Weak 1HFY24 results does not correspond to the strong rally in share price seen on a year-to-date basis
Analyst:
Foo Chuan Loong, Martin
martin.foo@midf.com.my
$UNISEM / 5005 (UNISEM (M) BERHAD)
Research by Kenanga
Market Perform – TP RM3.70
“2QFY24 Earnings Almost Double QoQ"
UNISEM's 1HFY24 results met expectations. The green shoots of recovery could be seen in almost a doubling in Its 2QFY24 net profit sequentially, driven by an improved showing from its plant in Chengdu while the earnings decline at its plant in Ipoh has already bottomed out. We keep our forecasts, TP of RM3.70 and MARKET PERFORM call.
Analyst:
Samuel Tan
samueltan@kenanga.com.my
$UNISEM / 5005 (UNISEM (M) BERHAD)
Research by HLIB
Sell – TP RM2.04
“Subdued margins"
As 2Q24 revenue undershot its own guidance, 1H24 core PAT of RM27m (-16% YoY) was below expectations. 2Q24 DPS of 2.0 sen will go ex on 19 Sep. Simpang Pulai plant operation remained subpar while in Gopeng, assembly/test pilot line equipment set up is ongoing and has started internal qualification. Chengdu’s utilization rate improved QoQ while equipment installation and qualification in Phase 3 are in progress. Expect revenue (in USD) to grow 8-10% in 3Q24 although industry outlook remains cautious. Reiterate SELL with a lower TP of RM2.04.
Analyst:
Tan J Young
jytan@hlib.hongleong.com.my
$UNISEM / 5005 (UNISEM (M) BERHAD)
Research by CGS
Reduce – TP RM2.00
“2Q24 core net profit missed expectations"
■ Unisem’s 2Q24 core net profit fell by 41% yoy on weaker margins given rising staff costs in anticipation of a production ramp-up in 2H24F.
■ Management guided for 8-10% sequential US$ revenue growth in 3Q24F, supported by production ramp-up at existing and new projects in Chengdu.
■ Reiterate Reduce with an unchanged GGM-derived TP of RM2.00. Valuation at 32.6x FY25F P/E looks steep vs. its 9-year historical average of 21x.
Analysts:
Shafiq KADIR
shafiq.abkadir@cgsi.com
Dharmini THURAISINGAM
dharmini@cgsi.com
Unisem's 2Q Net Profit Down 30pct on Change in Product Mix, Higher Costs
Unisem (M) Bhd's net profit fell 30 per cent to RM16.76 million in the second quarter ended June 30, 2024 (2Q24) from a change in product mix and increased operating costs.
A year ago the company made a net profit of RM23.93 million.
Quarterly revenue, however, rose 4.2 per cent to RM394.59 million from RM378.66 million previously, underpinned by higher sales volume as well as appreciation of US dollar against ringgit. The company registered a lower earnings per share of 1.04 sen for the quarter compared to 1.48 sen in 2Q23.
For the cumulative six months period, Unisem registered a net profit of RM25.22 million from RM33.79 million a year ago, while revenue rose to RM759.36 million from RM732.71 million previously.
The company has declared a second interim dividend of two sen per share, which will be paid on Oct 4, 2024.
On prospects, Unisem expects its performance to be satisfactory for the next financial quarter.
"In light of elevated global tensions and ongoing conflict, the outlook of the semiconductor industry remains cautious. "Malaysia stands to benefit from the trade tensions as a strategic alternative destination in the supply chain," it said.
Unisem also said that the launch of the National Semiconductor Strategy (NSS) by the Malaysian government is a positive development that should help drive the industry forward, thus benefiting local semiconductor companies.
$UNISEM / 5005 (UNISEM (M) BERHAD)
Source: https://cutt.ly/lel0rgBJ
Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - MR JOHN CHIA SIN TET
DEALINGS IN LISTED SECURITIES (CHAPTER 14 OF LISTING REQUIREMENTS) : Dealings Outside Closed Period
Changes in Director's Interest (Section 219 of CA 2016) - MR JOHN CHIA SIN TET
DEALINGS IN LISTED SECURITIES (CHAPTER 14 OF LISTING REQUIREMENTS) : Intention to Deal During Closed Period
KUALA LUMPUR: Unisem (M) Bhd has proposed to acquire 38 plots of vacant land covering a total area of 1.88 million square feet in in Kinta, Perak for RM30.14mil cash, or at the rate of RM16 per square foot.
TRANSACTIONS (CHAPTER 10 OF LISTING REQUIREMENTS) : NON RELATED PARTY TRANSACTIONSUNISEM (M) BERHAD (UNISEM OR THE COMPANY)
ACQUISITION BY UNISEM OF 38 PLOTS OF VACANT LAND MEASURING IN AGGREGATE APPROXIMATELY 1,883,619 SQUARE FEET LOCATED IN MUKIM SUNGAI RAYA, DAERAH KINTA, PERAK FOR A TOTAL CASH CONSIDERATION OF RM30,137,940
Changes in Director's Interest (Section 219 of CA 2016) - MR JOHN CHIA SIN TET
DEALINGS IN LISTED SECURITIES (CHAPTER 14 OF LISTING REQUIREMENTS) : Dealings Outside Closed Period
Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - MR JOHN CHIA SIN TET
DEALINGS IN LISTED SECURITIES (CHAPTER 14 OF LISTING REQUIREMENTS) : Dealings Outside Closed Period
Changes in Director's Interest (Section 219 of CA 2016) - MR JOHN CHIA SIN TET
Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - MR JOHN CHIA SIN TET
DEALINGS IN LISTED SECURITIES (CHAPTER 14 OF LISTING REQUIREMENTS) : Dealings Outside Closed Period
Changes in Director's Interest (Section 219 of CA 2016) - MR JOHN CHIA SIN TET
Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - MR JOHN CHIA SIN TET
SEMICONDUCTOR
$UNISEM / 5005 (UNISEM (M) BERHAD) $MPI / 3867 (MALAYSIAN PACIFIC INDUSTRIES BERHAD) $ELSOFT / 0090 (ELSOFT RESEARCH BERHAD)
Research by TA
Overweight
“Backed by Robust Growth in Memory and Logic”
Overall, we maintain our OVERWEIGHT stance on the semiconductor sector. We expect the sentiment of the semiconductor sector in Malaysia will improve further, backed by an anticipated healthy recovery in global demand and increasing trade diversion opportunities as a result of the China Plus One strategy. Within our universe, we have Buy recommendation on INARI (TP: RM4.30). Meanwhile, we maintain Hold recommendations on UNISEM (TP: RM4.37), MPI (TP: RM41.10), and ELSOFT (TP: RM0.58).
Analyst(s):
Chan Mun Chun
mcchan@ta.com.my
Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - MR JOHN CHIA SIN TET