Latest news with #RM1.04
New Straits Times
7 days ago
- Business
- New Straits Times
HLB logs RM946.7mil net profit, RM1.55bil revenue in Q3
KUALA LUMPUR: Hong Leong Bank Bhd's (HLB) posted a net profit of RM946.7 million in the third quarter ended March 31, 2025 (3Q25), down from RM1.04 billion a year ago. The 9.4 per cent profit fall was mainly due to higher operating expenses of RM23.7 million, lower share of profit from associated company of RM60.0 million and dilution loss from associated company of RM407.6 million. HLB's revenue for the quarter, however, rose to RM1.55 billion from RM1.44 billion previously, the bank's filing to Bursa Malaysia showed. Its earnings per share fell to 46.18 sen compared to 50.97 sen in 3Q24. No dividend was declared for the quarter. For the first nine months of FY25 (9MFY25), HLB's net profit rose to RM3.18 billion from RM3.16 billion a year ago, while revenue for the period climbed to RM4.78 billion from RM4.29 billion. The bank's net interest income for 9MFY25 was recorded at RM3.66 billion, marking a 5.8 per cent year-on-year (YoY) increase. This was underpinned by strong loan and financing growth as well as effective funding cost management. Accordingly, its net interest margin (NIM) was up five basis points (bps) YoY to 1.90 per cent. Its non-interest income for 9MFY25 maintained the notable improvement of 34.1 per cent YoY to RM1.12 billion, driven by encouraging performance in the wealth management business and GM franchise sales alongside the higher treasury and foreign exchange gain. The bank's expenses for 9MFY25 remained at RM1.85 billion, while the cost-to-income ratio was maintained at 38.8 per cent. Meanwhile, the bank's gross loans, advances and financing grew 7.2 per cent YoY to RM201.2 billion. This was driven by expansion in our key segments of mortgage, auto loans, SME and commercial banking as well as key overseas markets. Domestic loans/financing increased 7.1 per cent YoY, ahead of the industry growth rate of 5.3 per cent. The bank remains prudent in its funding and liquidity positions to strengthen resilience and stability, with loans to deposits ratio of 87.9 per cent as at March 31, 2025. Customer deposits for 9MFY25 rose 5.9 per cent YoY to RM225.0 billion with current account savings account expanding 5.0 per cent YoY to RM68.3 billion. HLB maintained a low gross impaired loans ratio of 0.57 per cent, reflecting stable asset quality. As of March 31, 2025, its capital position remained sound, with CET1, Tier 1, and total capital ratios at 12.8 per cent, 13.7 per cent, and 15.7 per cent, respectively. HLB group managing director and chief executive officer Kevin Lam said the bank is confident that the Malaysian economy will remain resilient amid the ongoing external headwinds. "At HLB, we focus on the execution of the 3-5 Year Transformative Plan to deliver sustainable results to our stakeholders. "With that, we are pleased to announce that our business performance thus far has been commendable underpinned by solid loans/financing growth, strong non-interest income contribution and healthy asset quality," he said in a separate statement. Lam said the bank acknowledges the presence of global uncertainties, particularly those stemming from evolving tariffs policies and negotiations, as well as policy responses from major central banks that could potentially influence the final growth outcome, even as resilient domestic demand is expected to provide a buffer against external headwinds. He added that by leveraging strengths in technology and artificial intelligence (AI), HLB will create innovative banking solutions that resonate with its customer across all touchpoints, solidifying its brand promise of "Built Around You".
Malaysian Reserve
26-05-2025
- Business
- Malaysian Reserve
Inari Amertron faces near-term headwinds
INARI Amertron Bhd is facing near-term headwinds as the semiconductor support player is seen punching below market expectations. For the third quarter ended March 31, 2025 (3Q25), its net profit plunged 24.8% quarter-on-quarter (QoQ) to RM55.5 million on a revenue of RM308.3 million, down 11.3% compared to the same period. 'Long-term prospects remain intact with efforts to tap into advanced packaging markets, but near-term headwinds and volatile geopolitical trade dynamics justify a more conservative stance,' BIMB Securities Sdn Bhd said in a note released last week. It has a 'Hold' call on the company's counter with a 52-week target price (TP) of RM2.23. Inari Amertron has 12 'Buy', eight 'Hold' and two 'Sell' calls among the analysts tracked by Bloomberg, with a consensus TP of RM2.24. OSAT Provider The semiconductor company operates in the outsourced semiconductor assembly and test (OSAT) and electronics manufacturing (EM) segments. It is the largest semiconductor player in Malaysia and a key OSAT provider for Broadcom's rapidly thriving wireless division. In an exchange filing on May 20, Inari Amertron reported its net profit for the first nine months ended March 31, 2025 (9M25), fell 30.9% to RM169.6 million, on revenue of RM1.04 billion, which was down 11.3%. It said the decline in revenue was mainly due to comparatively lower product volume loading across all business segments and changes in the product mix. The lower profit was attributed to reduced volume loading, unfavourable foreign exchange (forex) movements and a start-up loss of RM15.7 million at its China subsidiary during the period. Excluding the losses from the China subsidiary, the profit decline would have been 27%. Commenting on the results, BIMB Securities said it has maintained its cautious stance, as volume recovery has yet to materialise amid continued softness in the smartphone and industrial segments, which still account for a significant portion of Inari Amertron's portfolio. While data communications are showing early signs of growth, the company's limited exposure to artificial intelligence (AI) and advanced packaging technologies restricts its ability to capitalise on selective tailwinds in the sector. Although Inari Amertron continues to scale its China operations and explore strategic partnerships, contributions from these initiatives remain negligible in the near term, it said. Kenanga Research Lowers Inari Amertron Outlook The counter was downgraded to 'Market Perform' from 'Outperform' by Kenanga Investment Bank Bhd (Kenanga Research), with a lower TP to RM2, down from RM2.39. The research house said Inari Amertron's 9M25 results came in below expectations, primarily due to weaker demand in its radio frequency (RF) and opto-electronics segments. 'Post-US Liberation Day, it is becoming evident to us that margin pressures are likely to persist amid ongoing forex volatility and uncertainties stemming from US-China tariff war. Incorporating a more cautious outlook, we trim FY25F/FY26F earnings forecasts by 8%/16%,' it said. On the company's outlook, Kenanga Research said Inari Amertron anticipates selective growth in the semiconductor industry, driven by the accelerating adoption of generative AI across various sectors. The group also expects robust performance from the data communications sector — which contributed approximately 14% of 9M25 revenue — while demand for smartphones (which made up 68% of sales) and other semiconductor products is likely to remain subdued. 'Margin pressures are expected to persist, stemming from forex volatility and ongoing US-China tariff negotiations, which continue to disrupt supply chains and inflate cost structures,' added the report. Meanwhile, Apex Securities Sdn Bhd has maintained its 'Buy' call on Inari Amertron but lowered its TP to RM2.94 from RM3.53 following an earnings revision. 'We expect RF volume to see some upticks in the 4Q25, supported by front-loading and rush buying of end-product smartphones during the 90-day trade truce window. However, the longer-term outlook remains clouded, with limited visibility for RF and automotive-related demand due to ongoing tariff uncertainties,' it said. Maybank Investment Bank Bhd (Maybank IB) has retained its 'Hold' call and TP of RM2, noting it was encouraged by Inari Amertron's management team's ability to manage cost efficiently and maintain operating margins despite a high fixed-cost base. CIMB Securities Sdn Bhd also retained its 'Buy' call with a TP of RM2. 'We believe the US tariff exemption for smartphones will help mitigate pricing pressures, thereby supporting stable RF volume loadings for Inari Amertron. 'At the same time, we remain cautiously optimistic that new programme ramp-ups will begin contributing meaningfully to revenue in FY26F.' The research house said potential catalysts for the stock include higher contribution from new programmes, a stronger-than-expected recovery smartphone demand, new customer acquisitions driven by trade diversion from North Asia, earnings-accretive acquisitions, favourable incentives from the Malaysian government through the implementation of the National Semiconductor Strategy and higher dividend payouts. Public Investment Bank Bhd (PublicInvest) has maintained its 'Outperform' call but lowered Inari Amertron's TP to RM2.30, down from RM2.46. Despite flattish growth in the smartphone segment and weaker momentum in the industrial segment, the report said Inari Amertron is expected to deliver strong growth in data communications segment. Inari Amertron closed at RM1.87 on May 21, valuing the company at RM7.09 billion. Its 52-week high/low was RM4.02/RM1.42 respectively. — TMR This article first appeared in The Malaysian Reserve weekly print edition
New Straits Times
20-05-2025
- Business
- New Straits Times
Aeon profit rises 18 pct to RM68.1mil in Q1
KUALA LUMPUR: Aeon Co (M) Bhd's net profit for the first quarter (1Q) of 2025 rose 18 per cent to RM68.10 million from RM57.39 million a year earlier, supported by seasonal spending uplift from the double festive celebrations within the quarter. Revenue increased by 6.6 per cent to RM1.24 billion from RM1.17 billion previously, with its retail business and property management services segments recording revenue growth. Aeon said its retail business segment achieved 6.1 per cent higher revenue of RM1.04 billion in the quarter under review, contributed by stronger consumer spending during the double festive periods. Its property management services segment reported a revenue growth of 9.4 per cent to RM204.4 million, supported by improved occupancy rate, effective tenancy renewals, and higher sales commissions driven by buoyant tenants' sales performance during festive periods. Managing director Naoya Okada said the retail industry is expected to proactively adapt to rising business costs throughout the year, while continuing to meet evolving consumer expectations and support resilient household spending. "Aeon remains focused on enhancing operational efficiency, expanding its private brand offerings, accelerating digital transformation, optimising tenant mix, strengthening its loyalty programme, as well as elevating the overall value of its retail spaces to attract greater foot traffic," he said. Looking ahead, Aeon said it will continue to deepen customer engagement, capitalise on emerging opportunities, and reinforce the foundations of its core businesses to deliver sustainable value for its customers, business partners, and shareholders, while remaining steadfast in its role to serve communities across Malaysia.
BusinessToday
24-04-2025
- Business
- BusinessToday
Retail Consumption To Remain Robust: MIDF
MIDF Amanah Investment Bank Bhd (MIDF Research) has maintained its positive outlook on the consumer sector despite challenges, citing strong retail spending and a recovering tourism sector. The research house has reaffirmed its positive stance with a BUY recommendation for Fraser & Neave Holdings Berhad (F&N), Aeon, and Life Water, with respective target prices of RM32.68, RM1.77, and RM1.04. MIDF Research highlighted that the consumer sector remains resilient amid a moderated GDP outlook, with strong retail growth and stabilising margins in the food and beverage sector. Retail spending in Malaysia has sustained strong growth, with February 2025 retail trade expanding by 5.9% year-on-year to RM65.15 billion, bringing cumulative sales for the first two months of the year to RM131.27 billion. This marked a 7% increase compared to the same period in 2024. This growth was largely driven by buoyant demand in food and beverage, alongside robust sales in non-specialised stores such as hypermarkets and convenience outlets. Despite a modest dip in monthly sales following January's festive surge, the broader retail landscape remains strong. The stable labour market is also contributing to consumer resilience, with Malaysia's unemployment rate holding steady at 3.1%. Employment growth of 2.9% year-on-year continues to outpace the expansion of the labour force for the 43rd consecutive month. On the inflation front, the headline Consumer Price Index (CPI) moderated to 1.5% year-on-year in February 2025, signalling that inflationary pressures have remained well-contained, which supports the purchasing power of consumers. Looking ahead, MIDF Research expects retail consumption to remain robust, driven by structural factors such as civil servant pay hikes, higher minimum wages, cash assistance, and the recovery of the tourism sector. These elements are expected to bolster household spending, thus supporting sustained retail growth. In the food and beverage sector, while commodity trends are mixed, with cost pressures from cocoa and coffee, relief has been seen in sugar and packaging costs. Poultry feed costs have stabilised, which should support margins for companies in this segment. The strengthening of the ringgit, while positive, is likely to moderate as tariff risks persist, particularly with the potential indirect impact from US tariffs. Despite these challenges, MIDF Research has reiterated its positive stance on the consumer sector, maintaining 'BUY' calls on its top picks, F&N, Aeon, and Life Water, based on their solid positioning to benefit from the favourable consumer environment. Related
Yahoo
13-02-2025
- Business
- Yahoo
Is There An Opportunity With My E.G. Services Berhad's (KLSE:MYEG) 46% Undervaluation?
The projected fair value for My E.G. Services Berhad is RM1.92 based on 2 Stage Free Cash Flow to Equity Current share price of RM1.04 suggests My E.G. Services Berhad is potentially 46% undervalued Analyst price target for MYEG is RM1.43 which is 25% below our fair value estimate Today we'll do a simple run through of a valuation method used to estimate the attractiveness of My E.G. Services Berhad (KLSE:MYEG) as an investment opportunity by taking the expected future cash flows and discounting them to their present value. Our analysis will employ the Discounted Cash Flow (DCF) model. It may sound complicated, but actually it is quite simple! Companies can be valued in a lot of ways, so we would point out that a DCF is not perfect for every situation. Anyone interested in learning a bit more about intrinsic value should have a read of the Simply Wall St analysis model. Check out our latest analysis for My E.G. Services Berhad We are going to use a two-stage DCF model, which, as the name states, takes into account two stages of growth. The first stage is generally a higher growth period which levels off heading towards the terminal value, captured in the second 'steady growth' period. To start off with, we need to estimate the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, so we discount the value of these future cash flows to their estimated value in today's dollars: 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 Levered FCF (MYR, Millions) RM622.8m RM695.2m RM785.9m RM856.4m RM919.5m RM976.8m RM1.03b RM1.08b RM1.13b RM1.18b Growth Rate Estimate Source Analyst x2 Analyst x2 Analyst x1 Est @ 8.97% Est @ 7.36% Est @ 6.23% Est @ 5.44% Est @ 4.89% Est @ 4.50% Est @ 4.23% Present Value (MYR, Millions) Discounted @ 9.3% RM570 RM582 RM602 RM601 RM590 RM574 RM553 RM531 RM508 RM484 ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF) = RM5.6b After calculating the present value of future cash flows in the initial 10-year period, we need to calculate the Terminal Value, which accounts for all future cash flows beyond the first stage. For a number of reasons a very conservative growth rate is used that cannot exceed that of a country's GDP growth. In this case we have used the 5-year average of the 10-year government bond yield (3.6%) to estimate future growth. In the same way as with the 10-year 'growth' period, we discount future cash flows to today's value, using a cost of equity of 9.3%. Terminal Value (TV)= FCF2034 × (1 + g) ÷ (r – g) = RM1.2b× (1 + 3.6%) ÷ (9.3%– 3.6%) = RM21b Present Value of Terminal Value (PVTV)= TV / (1 + r)10= RM21b÷ ( 1 + 9.3%)10= RM8.8b The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is RM14b. In the final step we divide the equity value by the number of shares outstanding. Compared to the current share price of RM1.0, the company appears quite undervalued at a 46% discount to where the stock price trades currently. Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind. Now the most important inputs to a discounted cash flow are the discount rate, and of course, the actual cash flows. Part of investing is coming up with your own evaluation of a company's future performance, so try the calculation yourself and check your own assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at My E.G. Services Berhad as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 9.3%, which is based on a levered beta of 0.958. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. Strength Earnings growth over the past year exceeded its 5-year average. Debt is not viewed as a risk. Weakness Earnings growth over the past year underperformed the Professional Services industry. Dividend is low compared to the top 25% of dividend payers in the Professional Services market. Opportunity Annual earnings are forecast to grow for the next 4 years. Good value based on P/E ratio and estimated fair value. Threat Paying a dividend but company has no free cash flows. Annual earnings are forecast to grow slower than the Malaysian market. Whilst important, the DCF calculation ideally won't be the sole piece of analysis you scrutinize for a company. It's not possible to obtain a foolproof valuation with a DCF model. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. What is the reason for the share price sitting below the intrinsic value? For My E.G. Services Berhad, we've compiled three fundamental aspects you should explore: Risks: Be aware that My E.G. Services Berhad is showing 1 warning sign in our investment analysis , you should know about... Future Earnings: How does MYEG's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with our free analyst growth expectation chart. Other High Quality Alternatives: Do you like a good all-rounder? Explore our interactive list of high quality stocks to get an idea of what else is out there you may be missing! PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the KLSE every day. If you want to find the calculation for other stocks just search here. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
