Inari Amertron

[winston]

not vested

Inari’s share price down over 4% as Apple plans to drop Broadcom chip from devices

by Syafiqah Salim

Broadcom's RF chips are complex to design and manufacture, and therefore, replacement is unlikely in the short term.

The company currently trades at a price-earnings ratio of 25.62 times, and offers a dividend yield of 3.64%.

Singapore remains Inari’s largest geographical market, accounting for 86% of the group’s revenue for the financial year ended June 30, 2022 (FY2022), followed by China (8%) and Malaysia (5%).

Apple is Broadcom's largest customer, accounting for about 20% of the chip maker's revenue for the last fiscal year, which totalled nearly US$7 billion.

Source: theedgemarkets.com

https://www.theedgemarkets.com/node/651144

[winston]

not vested

November 21, 2022
Shariah Compliant Technology Malaysia

Inari Amertron (INRI MK)
1QFY23: A relatively muted start
Leaner ops, strong USD offset lower volume loading

Operational efficiencies and a strong USD offset weaker revenue in 1QFY23 as Inari’s customers turned cautious on volume loading owing to a weak macro-climate outlook. '

Pending mgmt’s briefing this Thursday, we maintain our BUY rating, TP and earnings forecast. With a potential upside of 45% to our TP (pegged to an unchanged 26x FY24 PER, at the LT mean), Inari remains our top MY tech hardware pick - premised on its strong mgmt team / operational resilience, proactive customer acquisition efforts, solid cash pile (MYR0.55 per share) and DY attraction; maintain BUY.

Source: Maybank

https://mkefactsettd.maybank-ke.com/PDFS/290061.pdf

[winston]

not vested

Inari Amertron (INRI MK)
1QFY23: In Line; Commendable Profit Thanks To Forex Gains

Results came in within expectations thanks to forex gains.

Inari is trading at an attractive 19.1x ex-cash FY23F PE after the recent selldown (-1SD below its five-year PE mean), notwithstanding the growth potential from its new venture and M&A activities
which could lift its market cap to strengthen its FBMKLCI constituent position.

Maintain BUY. Target price: RM3.10.

Source: UOBKH

https://research.uobkayhian.com/content ... 1b680d6342

[winston]

vested

- It was reported in the news that Apple plans to drop key Broadcom chip to use key in house design in 2025, according to people familiar with the situation.

- In particular, it was mentioned that Broadcom’s Combined WiFi and Bluetooth chip would be internalised

- Note that Apple also aims to ready its first cellular modem chip by the end of 2024 or early 2025, letting it swap out electronics from Qualcomm Inc.

- On the first glance, while the news appeared to be negative to Broadcom (including players in the supply chain), Inari is only involved in the RF FBAR filters, which is NOT part of the supply chain reconfiguration/internalisation. Note that RF contributes 2/3 of Inari’s total revenue.

- While there is no clear pic whether other chips would be part of the supply chain reconfiguration, Inari has been partnering wtih CFTC for OSAT jobs in China, which we see as an effort in diversification in terms of concentration risk.

[winston]

vested

Return to supremacy

Inari’s 1QFY21 core net profit of RM76m (+98% QoQ and +63% YoY) was in line with HLIB’s expectation but beat consensus.

The strong performance was mainly driven by the revival of RF business yielding favourable sales mix and improved margin.

Proposed first interim single tier dividend of 2.0 sen per share which goes ex on 15 Dec. Inari will continue to expand capacity to meet the robust RF demand over the next few quarters.

Reiterate BUY with unchanged TP of RM3.28, pegged to 35x FY22 FD EPS.

Source: HLIB

[winston]

vested

Kenanga sees no impact on Inari from Apple plans to drop Broadcom chip

by Surin Murugiah

Kenanga Research has maintained its “Market Perform” rating on Inari Amertron Bhd at RM2.64 with a lower target price (TP) of RM2.60 (from RM2.85) and said it does not expect Inari to be impacted by news that consumer electronics giant Apple Inc might be dropping Broadcom Inc's chip from its devices as it is involved in RF filters which are more complex in design and unlikely to be replaced in the short term.

Source: theedgemarkets.com

https://www.theedgemarkets.com/node/651288

[winston]

vested

Buy on Weakness

According to Bloomberg, Apple is looking to cut its dependency on Broadcom-supplied chips that power Bluetooth and WiFi capabilities across devices by 2024 and replace them with chips developed internally.

Apartfrom seeing some cost savings, we believe the move would also give them greater flexibility and control to design their products.

For Inari, we believe its OSAT business is unlikely to be affected given its cost advantage and
long establishment in the OSAT industry.

We advise investors to take advantage of the negative news flow as current valuations look appealing, trading closer to -1 standard deviation.

Inari remains one of our top picks for 2023. Maintain Outperform with an unchanged TP of RM3.74 based on 35x FY24 EPS.

Source: Public Invest

[winston]

vested

Inari pares loss as analysts see limited impact from Apple's plan to drop Broadcom chip

by Justin Lim

The company’s outsourced semiconductor assembly and test (OSAT) business is unlikely to be affected by Apple's move to replace Broadcom Inc’s chips with in-house design chips.

In the event that Apple successfully develops all types of chips required by its devices, Public Invest Research analyst Chong Hoe Leong said the research house’s back-of-the-envelope calculations showed that Inari’s direct exposure to the world's leading smartphone maker revenue is only 17%-18%, given that Apple contributed about 20% to Broadcom’s annual revenue.

Inari is only involved in the radio frequency (RF) filters and not any of the components stated in the news.

Based on the trend seen, it will be more than five years (since the acquisition of Intel’s cellular modem arm in 2019) before the US smartphone manufacturer finally implements its own design in 2025 that is able to compete with what Qualcomm is already offering.

Source: theedgemarkets.com

https://www.theedgemarkets.com/node/651317

[winston]

vested

Inari-Amertron Bhd
Building blocks of growth beyond FY23F

We expect RF to remain the major growth driver for Inari, driven by new value-added processes in new generation smartphones beyond 2023F.

We see exciting growth and diversification opportunities in China ahead of YSIC’s plant completion in 2HCY23F.

Reiterate Add and RM3.00 TP.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 565FF2E7FF

[winston]

vested

CGS-CIMB sees growth and diversification opportunities in China for Inari

by Surin Murugiah

Inari’s 54.5%-owned subsidiary Yiwu Semiconductor International Corp’s (YSIC) plant construction is on track for completion in 3QCY23F, with the initial production line set up by 4QCY23F.

CGS-CIMB said YSIC will be mainly involved in assembly and test services, including system-in-package assembly, for the China market.

”We estimate YSIC could contribute up to Rmb1 billion (RM650 million) revenue once its Yiwu plant is fully operational.

We believe Inari’s RF division growth prospects are intact as our channel checks indicate the group is already working on new processes technology to support new generation smartphone models.

Source: theedgemarkets.com

https://www.theedgemarkets.com/node/651454