KUALA LUMPUR (Aug 21): Malaysian Pacific Industries Bhd (KL:MPI) fell to its lowest in three months on Friday after the semiconductor services firm closed out its fiscal year slightly below market expectations.
The outsourced semiconductor assembly and test company could see a 34% earnings growth in the year ending June 30, 2027 (FY2027), according to Bloomberg consensus, though analysts remained cautious in their outlook for the stock price following year-to-date gains.
“While we remain positive on MPI’s exposure to the semiconductor upcycle and higher-margin opportunities in AI [artificial intelligence] servers and sensors, near-term cost pressures remain a key earnings constraint,” said Kenanga Investment Bank.
MPI fell as much as 6% or RM2.72 to RM42.58, its lowest since May 20. At 3pm, the stock was trading at RM43.56, valuing the company at RM8.7 billion, as more than one million shares exchanged hands.
Shares of MPI have retreated from their all-time high near the end of May. At its peak, the company's market capitalisation exceeded RM10 billion. Still, MPI is up by some 35% from the end of 2025, benefitting from broader optimism in the technology sector.
The stock now only has two 'buy' calls from seven research houses tracked by Bloomberg, with the rest on 'hold' and 'sell' calls. The average target price is RM48.06.
For CIMB Securities, which maintained its 'buy' recommendation, MPI is entering a new investment cycle with the opening of its Suxiang plant in China and the start-up costs are expected to weigh on earnings in the near term.
However, MPI’s growth prospects remain intact, underpinned by structural growth in demand for power chips required to manage high voltages and currents amid the rapid expansion of data centres, the research house said.
“Structural adoption of silicon carbide and gallium nitride in power packaging should further drive demand for MPI’s services, given their importance in high-power-density and high-efficiency applications for next-generation AI servers and rack systems,” RHB Research added.
Read also:
MPI 4Q net profit hit by costs and taxation