KUALA LUMPUR (Sept 10): A number of analysts have raised their earnings forecasts for Scientex Bhd (KL:SCIENTX), after a strong fourth quarter and full year results driven by both manufacturing and property segments.
Affin Hwang Investment Bank raised its FY2027/FY2028 earnings forecasts by 8.0%/6.1% respectively, reflecting stronger earnings from both the property and plastics segments.
Subsequently, the house kept its "buy" call and raised its sum of parts based target price (TP) of RM4.50 from RM4.35 earlier following the earnings upgrade.
In a separate note, TA Securities raised its FY2027-FY2028 core earnings forecasts by 4.7%, following the FY2026 results.
"We expect the (manufacturing) segment to sustain its momentum in FY2027, supported by stable demand for both consumer and industrial packaging," it said, while raising its TP to RM4.95 per share on the counter from RM4.82 previously.
Meanwhile, Nomura forecasts Scientex's FY2027/FY2028 core earnings of RM711 million/RM754 million, which is 15%/22% higher than FY2026 actual core earnings.
The house reiterated its "buy" recommendation at a TP of RM4.40 on the stock.
For 4QFY2026, the group's net profit rose nearly 30% year-on-year (y-o-y) to RM199.92 million compared to RM154.33 million the year prior.
During the quarter, the packaging segment alone saw revenue growth of 18.4% y-o-y to RM725.3 million, driven by higher average sales price, better margins and product mix.
Revenue in its packaging segment is expected to remain strong as renewed Middle East tensions will maintain high sale prices of industrial and commercial plastic packaging.
Analysts noted that while rising costs will be difficult to manage over the longer term, Scientex is shifting strategy to mitigate through cost pass-throughs, and sourcing competitively priced raw materials from China is expected to lead to higher contributions and better margins.
Meanwhile, during the quarter, its property segment saw a comparable growth of 17% to RM678.9 million due to 33 projects across Peninsular Malaysia.
Analysts expect strong gross development value from these projects when they launch in FY2027.