AEM - Maybank Research 2024-05-09: 2H24 Hopes Diminish; Downgrade To HOLD

• We were too optimistic of a much stronger 2H24E based on potential order recovery from AEM's key customer as well as ramp up of recently unveiled new orders.

Still too early

• However, AEM's management updated that the new orders will only start mass production at end-FY24 and the main surge will only come in FY25E. It also only expects an uptick in growth in 2025.
• - Read this at SGinvestors.io -

Main recovery only likely in FY25E

• AEM (SGX:AWX)'s 1Q24 revenue dropped 38.3% y-o-y to S$94.2m while NPAT fell 85% y-o-y to S$2.3m, below consensus estimates but in line with ours’. This is mainly due to drops in equipment sales of -69% y-o-y to S$9.7m and services of -38% y-o-y to S$94.2m, as a key customer already made large purchases in FY21-23.
• - Read this at SGinvestors.io -

Expect more orders from new customers

• Read more at SGinvestors.io.

Jarick Seet Maybank Research | https://www.maybank-ke.com.sg/ 2024-05-09 SGinvestors.io

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