KUALA LUMPUR (Oct 6): ViTrox Corporation Bhd (KL:VITROX) will grow its earnings strongly from increasing exposure to artificial intelligence, Apex Securities said.
The research house is initiating coverage of the semiconductor equipment company with a ‘buy’ call and target price of RM5, the highest among 13 analysts. Earnings may rise by 43% in the 12 months ending June 30, 2026 (FY2026) alone, according to Apex Securities’ estimates.
ViTrox is on course for a rerating as the company expands further into high-growth segments such as high-powered computing servers and advanced semiconductor packaging, the house said.
Shares of ViTrox have rebounded more than 81% from their April lows during the global tariff turmoil and benefited from a sharp rally last week in technology stocks spurred by rising odds of US interest rate cuts.
Apex Securities’ target price implies another 18% gain from ViTrox's current price. The consensus however is not as bullish with six ‘sell’, two ‘hold’, and five ‘buy’ calls. The average target price is RM3.81, implying potential decline of over 10% from the current price.
Based in Penang, ViTrox manufactures automated machine vision inspection equipment for the semiconductor and electronics manufacturing industries. Nearly two-thirds of its revenue come from selling inspection systems that scan for manufacturing defects in printed circuit boards.
ViTrox also has a suite of new products that would allow the company to capitalise on the capital expenditure upcycle over the next two years, Apex Securities said.
The downside risk from the US’ Section 232 investigations would be limited as the American market only accounts for 10% of ViTrox’ revenue while the 19% tariff slapped on Malaysian goods is currently absorbed by customers, the research house noted.
“Overall, we believe the strong demand momentum for ViTrox’s vision inspection solutions, coupled with shortening order lead times that signal heightened urgency from customers, should underpin robust growth ahead,” the house added.