Nanofilm Technologies - DBS Research 2022-11-18: Downgrade To HOLD As Outlook Worsens

Nanofilm Technologies - Downgrade To HOLD As Outlook Worsens

  • Post the release of NanoFilm Technologies (SGX:MZH)'s 9M22 update on 3 November 2022, further developments, especially with regard to the disruption to the smartphone supply chain of one of NanoFilm's key customers, and also the industrial equipment segment, has worsened, vs our earlier expectations of a gradual improvement.
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  • In the last two years, 2H typically accounts for ~60% of total revenue. For 9M22, NanoFilm registered revenue growth of 10% y-o-y. 1H22 saw revenue growth of 15% y-o-y.

Disruptions to supply chain affecting the smartphone segment.

  • The customer's factory in Zhengzhou, which supplies the bulk of the smartphone products for NanoFilm, has been operating at a significantly reduced capacity due to the COVID-19 restrictions in China. Hence, revenue contribution for this segment is expected to be lower.
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  • Overall, the 3C segment, which typically contributes > 60% to NanoFilm's total group revenue, could continue to see demand weakness in 2023. According to data from Gartner, phones, PCs, and tablets are projected to be back on the growth path only in 2024.

Industrial equipment segment affected by cuts in customers’ capital expenditure.

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Above is the excerpt from report by DBS Group Research.
Clients of DBS may access the full report in PDF @

Lee Keng LING DBS Group Research | 2022-11-18

Read also DBS's most recent report:
2024-02-27 Nanofilm Technologies - Margin Pressures Remain; FY23 Below Expectations Despite 2H23 Showing Recovery.

Previous report by DBS:
2023-11-09 Nanofilm Technologies - 3Q23 Profitable; Outlook Remains Challenging.

Price targets by 2 other brokers at NanoFilm Target Prices.

Listing of research reports at NanoFilm Analyst Reports.

Relevant links:
NanoFilm Share Price History,
NanoFilm Announcements,
NanoFilm Dividends & Corporate Actions,
NanoFilm News Articles


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