- We expect Frencken (SGX:E28) to issue its 3Q23 business update by after the market close on 27 Nov 2023. In our view, 3Q23F revenue likely fell by 9.5% y-o-y to S$176.8m, while net profit likely dropped by 45.1% y-o-y to S$6.0m.
Previously guided that 2H23F revenue could be similar to 1H23’s
- - Read this at SGinvestors.io -
- For 2H23F, Frencken has provided the following guidance for its segmental revenue:
- semiconductor segment to see higher revenue h-o-h;
- medical segment to register stable revenue h-o-h;
- analytical & life sciences segment revenue to increase h-o-h;
- - Read this at SGinvestors.io -
- automotive segment revenue to stay stable h-o-h.
There are production outsourcing opportunities from Europe into Malaysia, in our view
- Going into FY24-25F, we think Frencken’s customers’ inventories have been depleted and the company can expect more firm orders from these customers.
- In our view, compared to 1H23 when customers were not willing to accept components from Frencken due to their excess inventory situation, Frencken is now able to ship the components it is producing to customers.
- The Netherlands accounted for 27.2% of Frencken’s FY22 revenue. In our view, given the higher production costs in Europe and the difficulty in hiring workers, Frencken could benefit from production outsourcing opportunities from Europe into Malaysia.
Reiterate ADD with higher S$1.37 target price on rollover
- Read more at SGinvestors.io.
Above is the excerpt from research report by CGS-CIMB.
Clients of CGS-CIMB may access the full report in PDF @ https://www.itradecimb.com.sg/.
William TNG CFA CGS-CIMB Research | https://www.cgs-cimb.com 2023-10-19
Read also CGS-CIMB's most recent report:
2023-11-23 Frencken - Most Segments’ Revenue To Grow In 2H23.
Price targets by 5 other brokers at Frencken Target Prices.
Listing of research reports at Frencken Analyst Reports.
Relevant links:
Frencken Share Price History,
Frencken Announcements,
Frencken Dividends & Corporate Actions,
Frencken News Articles
