Greatech among top gainers in early trade on firm 2Q earnings

Greatech among top gainers in early trade on firm 2Q earnings
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KUALA LUMPUR (Aug 12): Greatech Technology Bhd emerged as one of the top gainers in early trade this morning after the group reported that its net profit in the second quarter (2QFY21) more than doubled to RM38.38 million from RM17.63 million a year ago. 

At 9.50am, the stock rose 18 sen or 2.84% to RM7.23, giving it a market capitalization of RM9.09 billion. It saw 2.85 million shares changed hands. 

Year to date, the stock has ballooned by 53.4% from RM4.70 recorded in January this year. 

Underpinned by strong revenue for production line systems (PLS) in the electric vehicle (EV) energy storage industry, the group’s quarterly revenue also jumped more than twofold to RM136.36 million from RM56.22 million a year ago, its filing to Bursa Malaysia showed yesterday. 

Earnings per share (EPS) also rose to 3.07 sen from 1.41 sen as a result.

In a bourse filing yesterday, Greatech said EV energy storage dominates the current quarter revenue, constituting 88.93% of the total revenue for PLS.

For the first half ended June 30, 2021, the group’s net profit grew more than two times to RM85 million from RM36.11 million a year earlier, while its revenue more than doubled to RM231.5 million from RM108.96 million.

Looking ahead, the group foresees improved demand driven by a continued uptick in activity in the end markets of solar thin film and EV energy storage to present attractive organic growth opportunities, supported by its strong local presence, consistent investment in technology and innovation as well as strategic expansion of its manufacturing capacities in Penang.

The group remains confident that it will continue to gain market share in the improving market conditions and deliver further improvements in the group’s second half financial performance.

The group, which continued to assess the capital expenditure spending as the year progresses, anticipated capital expenditure spending to be in the range of RM275 million to RM280 million, which is higher than the RM77.37 million announced on Feb 18.

This entails significant capacity investments to meet demand — which is expected to remain strong — as well as combined floor space of 1 million square feet by 2022, of which further details will be announced upon finalisation, said Greatech.

Surin Murugiah