Inari Amertron

[winston]

2QFY22: Plain sailing
Results above expectations; maintain BUY

2QFY22 core NP of MYR113m was above expectations, as 1HFY22 core NP of MYR226m came in at 56%/58% of our/the street’s FY22E estimates.

We have raised our FY22-24E earnings assumptions by 17%/23%/24%, but lower our valuation peg to 35x FY23E PER, at +1.5SD to the LT mean (from 44x at +2.5SD), to account for the accelerated inflation-induced rate increase cycle.

Imputing for both, our TP is nudged marginally higher to MYR4.77 (+1%).

Inari remains our top OSAT pick, underpinned by its RF division’s strength/robust volume loading and the potential onboarding of new customers as industry supply is likely to remain tight, at least until 1H23.

Source: Maybank

https://mkefactsettd.maybank-ke.com/PDFS/252066.pdf

[winston]

not vested

Inari Amertron (INRI MK)
1HFY22: In Line; Record-Breaking Quarter On Sixth Consecutive yoy Growth

Inari recorded its sixth consecutive yoy growth on a record-high profit, thanks to the
strong RF sales amid the 5G refreshment cycle.

The group has also executed its first multi-pronged growth strategy via horizontal integration, through a JV set up in China with CFTC for OSAT manufacturing in the China market.

Further earnings accretive M&A activities would uplift its market cap to strengthen its position as an FBMKLCI constituent. Maintain BUY. Target price: RM4.00.

Source: UOBKH

https://research.uobkayhian.com/content ... 8622241008

[winston]

not vested

Inari Amertron (INRI MK)
Decent Visibility In FY22; Gearing Up For Next Growth Engine

Despite material constraints and softer seasonality, Inari’s key segments are
expected to remain resilient in FY22.

Besides modules assembly services, the group is also exploring new trade-diversion opportunities in LED packaging and substrate level.

We increase our earnings forecasts by 8-11% for FY23-24.

Further earnings accretive M&A activities would uplift its market cap to strengthen its position as an FBMKLCI constituent.

Maintain BUY. Target price increased to RM4.30.

Source: UOBKH

https://research.uobkayhian.com/content ... 8ea6b56c30

[winston]

not vested

Inari Amertron (INRI MK)
Attractive Risk-Reward Ratio After Selldown Against Bright Prospects

Inari’s key segments are expected to remain resilient in FY22.

Besides modules assembly services, it is also exploring new trade diversion opportunities in LED packaging and substrate level.

Inari is trading at an attractive 19.2x ex-cash FY23F PE (-1SD to its five-year mean PE), notwithstanding the enormous growth potential from its new venture and M&A activities which could uplift its market cap to strengthen its FBMKLCI constituent position.

Maintain BUY. Target price: RM4.00.

Source: UOBKH

https://research.uobkayhian.com/content ... fb1870bbce

[winston]

not vested

New growth engine to start in 2HFY22F

We gathered that Inari’s product pipeline remains healthy, underpinned by diversification strategy into automotive and data communication segments.

Reiterate Add, with an unchanged RM4.30 TP, still based on 33x CY23F P/E.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 43517AC0CB

[winston]

not vested

Inari Amertron Bhd posted a 10% increase in its net profit for the third quarter ended March 31, 2022 (3QFY22) to RM90.48 million from RM81.95 million in the previous year’s corresponding quarter amid higher revenue growth across all business segments.

Its revenue for the quarter grew 5% to RM360.34 million from RM342.93 million a year ago.

It proposed a 2.2 sen per share dividend for the quarter.

For the nine months ended March 31, its net profit rose 25% to RM304.7 million from RM242.11 million a year earlier, while revenue jumped 13% to RM1.21 billion from RM1.07 billion previously.

Source: The Edge

[winston]

not vested

New China growth engine back on track

Inari is entering into a JV with China Fortune Tech Capital (CFTC) to carry out an OSAT business in China targeting China’s semiconductor market.

Inari is injecting cash and 100% stake in ATK for a controlling stake in YSIC, while CFTC will inject cash and existing investments in YSIC worth RM376m.

Reiterate Add, with an unchanged RM3.40 TP, still based on 27x CY23F P/E.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 367C6F466F

[winston]

Inari Amertron (INRI MK)
FY22: In Line; Commendable Profit Thanks To Forex Gains

Results are within expectations.

Inari’s core net profit recorded its eighth consecutive yoy earnings growth thanks to forex gains.

Inari is trading at an attractive 19.6x ex-cash FY23F PE (-1SD below its five-year mean PE), notwithstanding the enormous growth potential from its new venture and M&A activities which could uplift its market cap to strengthen its FBMKLCI constituent position.

We fine-tune our FY23-25 earnings by 1-2% after model updates.

Maintain BUY. Target price: RM3.40.

Source: UOBKH

https://research.uobkayhian.com/content ... 2912953124

[winston]

not vested

Record-breaking profit delivery in FY6/22

FY6/22 results were in line at 101%/100% of our/consensus forecasts.

Core net profit in FY6/22 rose 19% yoy on higher sales from all divisions.
However, we see tough FY6/23F prospects amidst softer mobile demand.

Revise down FY23-24F EPS by 10-11%; reiterateAdd with lower RM3.15 TP.

Source: UOBKH

https://rfs.cgs-cimb.com/api/download?f ... 5CAECC8A21

[winston]

not vested

Inari Amertron Bhd

MIDF said its top pick for semiconductor players is Inari Amertron Bhd given the company’s exposure in the radio frequency (RF) segment.

MIDF said the growth prospects for the sector stay intact, supported by the emerging technologies like 5G, Internet-of-Things (IoT), artificial intelligence (AI), personal computers (PCs), Cloud, and electric vehicles (EVs).

“We opined that the selldown of the tech sector might be overdone and thereby provide opportunities to forward-looking investors to place their investment in a growth stock,” MIDF said.

Public Investment also retained Inari as a suggested pick for 2023 amongst the smaller-capitalised stocks. The bank said it expects Inari to likely see multi-year growth stories and earnings stability.

Similar to MIDF, Public Investment said the management is particularly upbeat on the RF component outlook with strong double-digit growth. The bank also believes Inari for higher earnings contributions from new product offerings in the assembly of next-generation phone cycles.

MIDF recommended a TP of RM3.20 for Inari, while Public Investment suggested RM3.74.

Source: The Edge