KUALA LUMPUR (Aug 8): ATA IMS Bhd (KL:ATAIMS) said it has teamed up with Shanghai-listed Jinhua Chunguang Technology Co Ltd (Chunguang) to venture into the household and electrical appliances sector.

The electronics manufacturing service provider said its wholly owned subsidiary, Integrated Manufacturing Solutions Sdn Bhd (IMS), and Chunguang have agreed to form a joint venture (JV) company known as Suntone (Malaysia) Technology Sdn Bhd.

IMS will hold a 49% stake in the JV company via an investment of RM4.9 million, while Chunguang, which specialises in cleaning electrical hoses and accessories, will hold the remaining 51% stake worth RM5.1 million, said ATA IMS said in a filing with the stock exchange.

Noting that many customers are shifting their manufacturing bases to Southeast Asia due to geopolitical factors, the group said the JV will enable the ATA group and Chunguang to capitalise on these trade diversion opportunities.

ATA IMS' largest shareholder is Datuk Seri Foo Chee Juan, who holds a direct 0.11% stake and an indirect 33.97% through Oregon Technology Sdn Bhd. Other significant shareholders include Datuk Fong Chiu Wan with a direct 26.28% stake and Datuk Balachandran Govindasamy with a direct 0.82% stake and an indirect 7.15% through PP Tech Ltd.

For the financial year ended March 31, 2024, the group reported a net loss of RM104.9 million, down from RM254.54 million in the previous year, due to lower impairment of goodwill, plant and equipment, and reduced provision for slow-moving stock. Revenue fell 56.3% to RM399.81 million from RM915.78 million.

ATA IMS shares reached a two-year high of 52 sen last month but have since retreated. They closed unchanged at 38.5 sen on Thursday, giving the group a market capitalisation of RM457.24 million. Year-to-date, the counter has risen by over 26%.