Frencken - Maybank Research 2025-03-02: Growing Steadily

• Frencken remains our Top Pick in the Singapore tech sector. Frencken expects semi-con sales to increase further in 1H25 while the other segments remain stable. It’s also considering enhancing and expanding its production resources in Singapore to raise efficiency, capacity and capabilities to cater to new and expanded existing programmes.
• - Read this at SGinvestors.io -

Expect semi-con sales to still increase in 1H25

• Management expects its semi-con sales to increase in 1H25E from 2H24, especially in Asia and continue to gain more wallet share of its key customers in the front-end equipment sector.
• - Read this at SGinvestors.io -

Potential capacity expansion in Singapore

• To cater to new and expanded existing programs, as well as future business growth, Frencken is considering enhancing and expanding its production resources in Singapore due to its strong Intellectual property laws to increase efficiency, capacity and capabilities, especially as one of its key semi-con customers is also expanding in Singapore. This is likely to cost S$40-60m and 2 years to complete.
• In the US, a new facility will be inaugurated in 1H25. This will expand the US operation’s production capacity to support growth of the existing business and to capitalise on future opportunities.

Maintain BUY with a lower target price of S$1.20

• Read more at SGinvestors.io.

Jarick Seet Maybank Research | https://www.maybanktrade.com.sg/ 2025-03-02 SGinvestors.io

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