KUALA LUMPUR (Sept 2): Ann Joo Resources Bhd (KL:ANNJOO) extended its decline on Tuesday as investors reacted to a weaker quarter while analysts flagged demand worries weighing on the stock.
The ballooning net losses for the first half of 2025 were larger than expected, and the company is expected to stay in the red for 2025, according to estimates by CIMB Securities and TA Securities. CIMB Securities downgraded the stock to ‘hold’ from ‘buy’ after slashing its forecasts.
Globally, the steel market continues to grapple with subdued demand from China’s property sector while uncertainties over project rollouts in Malaysia could limit near-term visibility, said TA Securities.
Ann Joo slipped on Tuesday to 67 sen, its lowest in three weeks.
Shares of Ann Joo have declined about 20% year to date. Steel prices in the international market, meanwhile, have recovered since China introduced “anti-involution” measures in a bid to stamp out price wars and curb industrial overcapacity.
Following CIMB Securities’ downgrade, Ann Joo no longer has any ‘buy’ calls. The stock now has two ‘hold’ and one ‘sell’ call, with an average target price of 75 sen.
Any earnings recovery in the second half will be muted for Ann Joo, CIMB Securities said. “Without additional stimulus, we caution that the current uptrend in steel prices may not be sustainable as China’s steel demand remains subdued against elevated steel exports,” the research house added.
On Friday, Ann Joo reported that its net losses widened to RM54.05 million, or 7.7 sen per share, for the second quarter ended June 30, 2025 (2QFY2025). The total net loss for the first six months swelled to RM132.89 million from RM59.87 million in the same period in 2024.