Aurelius Technologies growth momentum intact
Maybank IB said the company's management has flagged that continued US dollar weakness could exert pressure on margins.
PETALING JAYA: Aurelius Technologies Bhd 's strong demand from new and existing customers is anticipated for all its three core segments in the coming quarters, although the US dollar weakness could exert some pressure on margins.
Maybank Investment Bank Research (Maybank IB) said from the company's latest results briefing, it gathered that growth momentum from new and existing customers is expected across all three core segments – communications and Internet of Things (IoT), electronic devices and semiconductor components (SC), in the coming quarters.
Plant utilisation across plant one (P1) to P3 has reached about 90%, while the latest facility, P5, is currently operating at 10% utilisation rate (UR).
That said, the research outfit said management has flagged that continued US dollar weakness could exert pressure on margins but the impact may be offset by higher volume loadings as demand scales up.
'Our back-of-the-envelope calculations suggest that every 5% depreciation of the US dollar against the ringgit could reduce revenue by about 5% and net profit by around 4%.
Aurelius Technologies is a provider of manufacturing solutions for industrial electronic products.
The company's long-standing engagement with a new customer is starting to bear fruit, with mass production and material contribution expected as early as the third quarter of this financial year (3Q25).
For its SC customer, momentum appears to be picking up as UR has reached about 80% to 85%, it noted.
Separately, Aurelius Technologies is also installing customer-consigned infrastructure to support rising demand as discussions for additional production lines are ongoing.
'With overall UR running at near full capacity, we believe there is a realistic opportunity for the company to expand capacity further, potentially by adding new lines in P5,' Maybank IB said, noting that it is lifting its 2026 estimate earnings forecasts by 5%, driven by more favourable product mix while adjusting 2027 estimate by minus 3% to reflect slightly slower gestation period of new capacity.
Maybank IB is reiterating a 'buy' call on Aurelius Technologies, underpinned by its exposure to the ongoing global supply chain diversification and its strong expertise in IoT and automotive modules.
Key risks include weaker than expected demand, loss of key customers, ringgit strength and production ramp-up delays.
For the first quarter of the financial year ended March 31, 2025, the company's net profit rose to RM16.10mil from RM15.73mil in the previous corresponding period, while revenue improved RM147.85mil from RM125.70mil a year earlier.
In a filing with Bursa Malaysia on its first-quarter performance, Aurelius Technologies said the communication and IoT products contributed RM124.5mil (84.2%), electronics devices contributed RM15.2mil (10.3%) and semiconductor components contributed the remaining RM8.1mil (5.5%).
'In the preceding year's corresponding quarter, the group recorded a revenue of RM125.7mil.
'Communication and IoT products contributed RM95.2mil (75.7%), electronics devices contributed RM25mil (19.9%) and semiconductor components contributed the balance of RM5.5mil (4.4%).'
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