Kenanga IB sees limited impact on Scientex from US tariffs
KUALA LUMPUR: Kenanga Investment Bank Bhd (Kenanga IB) expects only minimal direct impact from the US tariffs threat for Scientex Bhd as the group has a manufacturing plant in the United States, making its exports to the US below five per cent of its total revenue.
Kenanga IB said management had guided on a challenging outlook for its plastic packaging segment given global economic and tariffs uncertainties and aggressive competition in the market.
"As the price of crude oil has surged more than 10 per cent lately largely due to the latest escalations of geopolitical tensions in the Middle East, we are monitoring any potential increase in resin price," it said in a note today.
In a Bursa Malaysia filing yesterday, Scientex recorded a lower net profit of RM123.87 million for the third quarter ended April 30, 2025, compared with RM130.50 million in the same period a year ago.
The packaging manufacturer and property developer said lower profit was mainly attributed to lower export sales and foreign exchange losses in the packaging division, which saw its revenue decline by 6.4 per cent to RM614.8 million from RM656.9 million.
For its property division, Kenanga IB said sales of its affordable properties should continue to be resilient given encouraging take-up rates from recent launches.
The group's unbilled sales stood at RM1.7 billion as of the second quarter of this fiancial year.
"In the past one year, we observe continuous demand for affordable houses priced below the RM500,000 mark while we saw rising appetite for housing in the range of RM500,000 to RM1 million signalling improving affordability," it added.
The research house maintained Scientex as 'market perform' with a higher target price of RM3.60 from RM3.34 previously.
As of 10.53 am, Scientex's share price rose one sen to RM3.35, with 789,00 shares traded on Bursa Malaysia.
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