Inari Amertron

[winston]

not vested

Inari’s FY24 outlook likely to improve

PETALING JAYA: Near-term challenges due to lacklustre smartphone shipment will continue to weigh on Inari Amertron Bhd, whose core earnings at RM255mil for the nine-month period of financial year 2023 missed analysts’ estimates.

For the period under review, revenue came in lower by 12.9% year-on-year to RM1.06bil amid low demand for consumer devices, while 3Q23 revenue and core profit fell 23.5% and 41% from a year ago, with weaknesses seen in the radio frequency and optoelectronic businesses, said the research house.

Going forward, it expects new power modules on the system-on module platform, sensors, memory, and power LED to drive growth in FY24.

Source: The Star

https://www.thestar.com.my/business/bus ... to-improve

[winston]

not vested

Semiconductor players set to see rebound this year

In the outsourced semiconductor assembly and test space (Osat), Kenanga Research said its preference remains with Inari Amertron Bhd due to its proactive strategy towards artificial intelligence-related products.

Inari has initiated low-volume production through a single line for a memory customer, with plans to expand to four lines by June this year.

The company has indicated that this venture into memory products will eventually position it to capitalise on the growing demand for artificial intelligence (AI) applications, as memory plays a crucial role alongside graphical processing power.

Furthermore, its foray into optical transceivers is gaining momentum, driven by the transition to 800 gigabits per second by customers seeking faster data transfer rates within data centres to accommodate growing AI adoption, it added.

Meanwhile, for its radio frequency business (about 63% of group revenue), Inari anticipates the upcoming low cycle in 1Q23 to be manageable, cushioned by the absence of power interruptions that occurred in the prior quarter.

Source: The Star

https://www.thestar.com.my/business/bus ... -this-year

[winston]

not vested

Inari Amertron (INRI MK)
9MFY24: In Line With House Expectation; Gearing Up For Next Growth Engine

Inari’s results were in line with our forecast but below consensus expectation.

The group is back to growth trajectory again in 2024 predominantly driven by its RF segment (on new flagship programme) after a gestation year in 2023.

In view of 27.3x ex-cash 2024F PE (-0.5SD below its five-year mean) with negative de-ratings being
priced in, we see a balanced risk-reward ratio for a favourable entry point.

Maintain BUY. Target price: RM3.60.

Source: UOBKH

https://research.uobkayhian.com/content ... e=hs_email

[winston]

not vested

Inari-Amertron Bhd
No major surprises

9MFY24 core net profit (-3% yoy) was in line with our estimates, at 72%/70% of our/Bloomberg consensus’ full-year forecasts.

Operational footprint expansion for new businesses is underway, but EPS contribution may still be negligible in FY24F, in our view.

We reiterate our Hold call with a GGM-derived TP of RM2.90. At 35.4x FY24F P/E, the stock is trading close to +1 s.d. of its 8-year mean of 29x.

Source: CIMB

https://rfs.cgsi.com/api/download?file= ... E91153A9BD

[winston]

not vested

4QFY24: Another tough year

HOLD maintained with a lower TP

Inari’s delivered a subdued set of results in 4QFY24 as it grappled with margin compression, primarily from efforts to diversify its customer base.

We introduce FY27E and lower our earnings estimates for FY25-26E by 5%10%.

Our TP is also lowered to MYR3.30 (-10sen) as we roll-forward valuations to FY26E.

Our TP is now pegged to 29x FY26E PER, at LT mean (from 32x FY25E PER, +0.5SD previously). Risk-reward remains balanced.

Source: Maybank

https://mkefactsettd.maybank-ke.com/PDFS/401926.pdf

[winston]

not vested

Inari Amertron (INRI MK) FY24: Below Expectations; Gearing Up For Next Growth
Engine Results missed expectations on subpar margin in 4QFY24.

Cut FY25-26 earnings by 910%.

Inari is gearing up to capture the booming wave of AI-capable smartphones and high bandwidth optoelectronic devices in networks and data centres.

At 26.5x ex-cash 2025F PE (at its five-year forward mean) with negative de-ratings (cyclical bottom) being priced in, we see a balanced risk-reward ratio for a favourable entry point.

Maintain BUY. Target price: RM3.80.

Source: UOBKH

https://research.uobkayhian.com/content ... e=hs_email

[winston]

not vested

Positioning For The Next Wave Of Growth

Inari is gearing up to capitalise on the exponential growth of the advanced packaging market, fuelled by transformative megatrends such as the explosive proliferation of AI and Edge AI technologies.

With an ex-cash 2025F PE of 23.6x (close to -1SD below its five-year forward mean) with the onset of recovery from a cyclical bottom, the current valuation offers a compelling risk-reward dynamic for a favourable entry point.

Maintain BUY. Target price: RM3.40.

Source: UOBKH

https://research.uobkayhian.com/content ... e=hs_email

[winston]

not vested

Advanced packaging sharing takeaways

Inari’s management shared its technological roadmap for its advanced packaging solutions, aiming to make bigger inroads into logic and memory.

This could translate into rising capex in FY25-26F, partially mitigated by collaborations with other partners and agencies.

Reiterate Hold, with a lower TP of RM2.60, as we cut FY25-26F EPS by 1920% on lower RF revenue and margin dilution from new ventures.

Source: CGS

https://rfs.cgsi.com/api/download?file= ... 7CA93E31F5

[winston]

not vested

1HFY25: Navigating Choppy Seas; Positioning For Next Wave Of Growth

Results missed expectations dragged by lower loadings in the auto and industrial segments as well as adverse forex fluctuations.

Cut FY25-26 earnings by 4-7%. Inari is gearing up to capture the booming wave of AI-capable smartphones and high bandwidth optoelectronic devices in networks and data centres.

At 23.2x ex-cash 2025F PE (at -1SD below mean) with negative de-ratings being priced in, we see a balanced risk-reward ratio for a favourable entry point.

Maintain BUY. Target price: RM3.20.

Source: UOBKH

https://research.uobkayhian.com/content ... e=hs_email

[winston]

2QFY25: Sluggish momentum

Maintain HOLD with lower TP of MYR2.70

INRI’s 2QFY25 earnings delivery underwhelmed on the back of weaker forex translation and tariff tiff-related global demand uncertainties that may have affected volume loading.

With expectations of a weaker outlook, we cut FY25-27E by 8-26% and lower our TP to MYR2.70, albeit still pegged to the 5Y Mean, but at a higher 31x FY26E PER (29x FY26E previously).

Maintain HOLD, as downside risk may be limited following INRI’s 16% share price retracement since 13 Dec 24. We prefer FRCB for MY Semicon.

Source: Maybank

https://mkefactsettd.maybank-ke.com/PDFS/437861.pdf