KUALA LUMPUR (Nov 8): Shares of Pentamaster Corp Bhd (KL:PENTA) fell on Friday, after the automated test equipment company reported that its net profit nearly halved in the latest quarter.
Pentamaster declined as much as 27 sen or nearly 7% to RM3.73. The stock was trading at RM3.84 at 9.05am, giving the company a market capitalisation of RM2.74 billion. Trading volume totalled 249,100 shares so far.
RHB Research, in a note on Friday, maintained its “buy” call on the stock, with a target price (TP) of RM5.95, despite Pentamaster’s 9MFY2024 core net profit coming in below expectations, making up only 67% and 70% of the house’s and consensus’ full-year estimate.
“The automotive segment saw another disappointing quarter, impacted by persistent market headwinds, following the recent policies and tariffs announced by the US and Europe on Chinese-made EVs (electric vehicles),” it added.
However, RHB noted that Pentamaster’s 3QFY2024 pre-tax profit margin improved sequentially to 9.7% (versus 2QFY2024: 6%), thanks to higher-margin projects.
“This offsets the weaker FAS (factory automation solutions) margin, which dropped 5.1 ppts (percentage points) to 28.2%, due to higher material cost,” it added.
Sales during the quarter were impacted by lower automated test equipment (ATE) sales volume.
Moving forward, RHB said Pentamaster expects its ATE segment to remain subdued, possibly until the first half of 2025, due to macroeconomic uncertainties and policies affecting Chinese-made EVs.
Nonetheless, the company sees growth in semiconductor packaging and optoelectronic devices, and is taking steps to enhance operational efficiency, RHB added.