KUALA LUMPUR (Sept 1): Inari Amertron Bhd (KL:INARI) tested a 20-month high in Tuesday trading, as more analysts turned optimistic on the semiconductor services firm’s earnings recovery that appears to be gaining traction.
At least two analysts upgraded the stock post-earning briefing. Kenanga Investment Bank said stronger volume loading for radio frequency (RF) chips and the accelerating ramp-up of its fibre optics business will support earnings for the financial year ending June 2027 (FY2027).
“RF remains the core earnings anchor, with a stronger start to the new smartphone cycle,” the house said, noting that Inari has indicated capacity utilisation of about 85%, above its earlier 75% expectation.
Shares of Inari added as much as 18 sen, or about 7%, to RM2.74 on Tuesday, their highest since January 2025. The stock pared some of its earlier gains to close five sen, or 1.95%, higher at RM2.61 on Tuesday, giving the group a market capitalisation of RM10.04 billion.
The outsourced semiconductor assembly and test company has gained nearly 60% in market value so far this year, as investors bet on a massive jump in earnings, driven by artificial intelligence in smartphones, as well as demand for optical transceivers used in data centres.
Inari has 13 'buy' and seven 'hold' calls, without any 'sell' rating from analysts. The average target price, meanwhile, has risen to RM2.75.
The photonics business is “increasingly becoming the more important driver” for Inari with the company’s in-house chip fabrication capacity expected to double in FY2027, driven by strong demand from a client identified only as Customer B, said BIMB Securities.
“The key inflection point will be the transition from its current small, lab-scale operation into automated, high-volume manufacturing by October-November,” the research house said.
BIMB Securities upgraded its recommendation to 'buy' from 'hold' and raised its target price by 38 sen to RM2.90, citing a multi-year growth phase ahead, rather than a cyclical recovery.