27/08/2025

BIZ & FINANCE WEDNESDAY | AUG 27, 2025

20

MARKETS/FROM THE BROKERS

SUNBIZ presents extracts of a selection of commentaries and research reports received from stockbrokers on counters that could be of interest to investors.

DISCLAIMER: The information is extracted from stockbrokers’ commentaries and research reports and do not represent the views or opinions of Sun Media Corporation Sdn Bhd. It is not a solicitation, recommendation or an offer to buy or sell the equities featured. Sun Media Corporation shall not be liable or responsible for any consequences resulting from usage of the information.

[ Compiled by SunBiz Team

Sorento Capital posts 18% revenue growth for FY25 KLANG: Sorento Capital Bhd, a bathroom and kitchen sanitary ware solution provider, recorded an 18.3% revenue growth to RM179.2 million for the financial year ended June 30, 2025 (FY25), up from RM151.5 million in FY24. Stronger performance across dealer and project-based sales channels drove the increase. As this marks the fourth interim financial report under the ACE Market Listing Requirements of Bursa Malaysia, no comparative quarterly figures are available. Dealer sales remained the group’s largest revenue contributor at 65.9%, rising 20.8% YoY to RM118.1 million (FY24: RM97.8 million). Project-based sales accounted for 33.3% of total revenue, growing 12.2% YoY to RM59.6 million (FY24: RM53.1 million). Online sales more than doubled to RM1.5 million from RM0.6 million previously. Net profit for FY25 rose 7.4% to RM26.2 million (FY24: RM24.4 million). Excluding one-off IPO listing expenses of RM3.1 million, adjusted net profit stood at RM29.3 million. In Q4’25, the company reported a net profit of RM7.9 million and revenue of RM43.3 million, resulting in a net margin of 18.2%. Sorento Capital declared a 0.5 sen single-tier tax-exempt dividend per ordinary share for FY25, amounting to RM4.3 million, which was paid on March 21, 2025. A similar interim dividend has been proposed for FY26, payable on Sept 19, 2025. As of June 30, 2025, the company maintained a robust net cash position of RM33.1 million, offset by borrowings of RM6 million, supported by a net operating cash flow of RM17.7 million – ensuring ample headroom for strategic growth. FM Global Logistics Holdings Bhd Neutral. Target price: RM0.59

Ringgit slips against dollar ahead of US data release THE ringgit ended lower against the American dollar yesterday on profit-taking ahead of the release of US economic data later today and toward the end of the working week. At 6pm, the local note slid to 4.2160/2210 versus the US dollar from Monday’s close of 4.2045/2105. UOB Kay Hian Wealth Advisors Sdn Bhd head of investment research Mohd Sedek Jantan said the US Conference Board consumer confidence report is due later, followed by a revision to US second-quarter GDP on Thursday and the closely watched core Personal Consumption Expenditures (PCE) inflation print on Friday. “Adding to this, the US Federal Reserve (Fed) Governor Christopher Waller is scheduled to deliver a speech on Thursday. Having voted for a rate cut in July and regarded as a leading contender to succeed Jerome Powell as Fed Chair next May, his comments on monetary policy will carry particular weight for markets,” he told Bernama. At the close, the ringgit settled mostly lower against a basket of major currencies. It rose versus the euro to 4.9087/9145 from 4.9163/9233 at Monday’s close, but fell vis-à-vis the Japanese yen to 2.8571/8607 from 2.8534/8577, and weakened against the British pound to 5.6827/6895 from 5.6740/6821. It traded mixed against other Asean currencies. The local note inched down versus the Singapore dollar to 3.2786/2828 from Monday’s 3.2761/2810, went down against the Thai baht to 12.9707/9917 from 12.9561/9801, and slid vis-à-vis the Indonesian rupiah to 258.6/259.0 from 258.5/259.1 previously. D&O Green Technologies Bhd Not Rated

Exchange Rates

FOREIGN CURRENCY

SELLING TT/OD

BUYING TT

BUYING OD

1 US Dollar

4.2740 2.7880 3.3290 3.0830 4.9810 2.5110 3.3290 5.7620 5.3470 3.5800 60.1100 68.4100 55.2500 4.9600 0.0272 2.9090 43.3900 1.5300 7.6400 118.1200 115.0600 25.1700 1.4500 46.0500 13.7700 117.6300 N/A

4.1380 2.6740 3.2250 2.9970 4.8190 2.4180 3.2250 5.5780 5.1180 3.3330 57.5600 62.9500 52.4900 4.6500 0.0246 2.8050 39.9100 1.4300 7.1900 112.1300 109.2200 22.7300 1.3300 41.9400 12.2100 111.5200 N/A

4.1280 2.6580 3.2170 2.9850 4.7990 2.4020 3.2170 5.5580 5.1030

1 Australian Dollar 1 Brunei Dollar 1 Canadian Dollar 1 New Zealand Dollar 1 Singapore Dollar 1 Sterling Pound 1 Swiss Franc 100 UAE Dirham 100 Bangladesh Taka 100 Chinese Renminbi 100 Danish Krone 100 Hongkong Dollar 100 Indian Rupee 100 Indonesian Rupiah 100 Japanese Yen 100 New Taiwan Dollar 100 Norwegian Krone 100 Pakistan Rupee 100 Philippine Peso 1 Euro

111.3200

3.1330

N/A

62.7500 52.2900 4.4500 0.0196 2.7950 39.7100 1.2300 6.9900 111.9300 109.0200 22.5300 1.1300 41.7400 11.8100 N/A

100 Qatar Riyal 100 Saudi Riyal

100 South Africa Rand 100 Sri Lanka Rupee 100 Swedish Krona

100 Thai Baht

Source: Malayan Banking Bhd/Bernama

Allianz Malaysia Bhd Neutral. Target price: RM19.60

Aug 26, 2025: RM18.20

Aug 26, 2025: RM1.31

Aug 26, 2025: RM0.575

Source: Bloomberg

Source: Bloomberg

Source: Bloomberg

FM reported Q4’25 core profit of RM7.9 million (+6.8% QoQ, +54.7% YoY), bringing FY25 core earnings to RM31.5 million (+2.9% YoY), which came slightly below our and consensus fullyear estimates at 95.8% and 97.8%. Earnings growth was primarily driven by a more conducive pricing environment and better product mix. FM’s sea freight segment posted a stronger revenue (+24.3% YoY) and profit (+9.4% YoY) on higher throughput (+4.7% YoY) of 120k TEUs. The air freight wing posted revenue growth of 20.4% YoY to RM108.7 million and profit growth of 12.1% YoY to RM26.9 million, supported by recurring aircraft projects. On the other hand, land freight rose 10.3% YoY to RM41.6 million in revenue, driven by fleet expansion and new customers. In contrast, the 3PL and warehousing segment remained a drag, with revenue and profit contracting 10.1% and 11.3% YoY, largely due to elevated operating costs from the new warehouse. That said, management expects this facility to contribute positively from FY26 onwards. We remain cautiously optimistic on FM’s earnings trajectory. While the company should continue to benefit from resilient sea freight volumes and a recurring project works in air freight, external headwinds cannot be overlooked. We expect global uncertainty to remain high, driven by unpredictable US tariff policies and a subdued global trade growth outlook, with the World Trade Organisation projecting 1.8% growth in 2026. These factors could dampen volume recovery and weigh on freight rates in the near term. Key downside risks: Slower-than-expect volumes, higher-than expected opex, and a slowdown in global trade activities. The opposite represents the upside risks. NEUTRAL with RM0.59 TP. – RHB Research, Aug 26

D&O commands strong positions in automotive optoelectronics, with innovations spanning interior, exterior, and ambient lighting. Its LEDs feature precise colour/intensity control, superior thermal and power performance, and support high-speed ethernet (single controller unit), cate ring to EV and smart-car trends. This technological edge, coupled with robust manufacturing capabilities, positions the company to capture market share in a competitive landscape with a remarkable 5 year revenue CAGR of 16% despite lacklustre vehicle sales. In April 2024, it partnered with ams-OSRAM (AMS SW, NR) to integrate its Open System Protocol (OSP) into for automotive ambient lighting solutions – as a second source of compatible LEDs, boosting supply chain flexibility and resiliency. Despite the modest auto sales growth (+1.3% in 2025), D&O benefits from rising LED content per vehicle and growing EV penetration. In fact, the automotive LED market is forecasted to record a CAGR of 6.9% through 2029, driven by trends such as EV adoption, adaptive lighting, connected cars, and energy efficiency. With over 100 customers, design wins in rear combination lights and headlamps, and a 5-year revenue CAGR of 16%, D&O is well-positioned for structural growth with design wins in both rear combination lights and headlamp (offers better margin). Besides, signs of recovery are seen from the average automotive Tier-1 supplier revenue growth of 6% QoQ in Q2’25 and expected recovery in orders for D&O in 2H’25. Margin recovery in 2H’25 and FY26 should be supported by cost rationalisation (headcount, process efficiency, material savings) and capex optimisation. – RHB Research, Aug 26

ALLZ’S Q2’25 net profit of RM214 million (+28% YoY, flat QoQ) brought the 1H’25 total to RM427 million (+20% YoY) – forming 55% and 54% of our and consensus’ full-year estimates. The key deviation stemmed from higher-than-expected insurance service results (+27% YoY) on lower-than-expected reinsurance expenses. This, we expect, will trend higher in 2H’25 as the monsoon season commences. Overall, insurance revenue growth was a robust 12% YoY owing to strong contributions from both the general and life insurance segments, while a better claims experience ensured a slight uptick in the underwriting margin to 17% (1H’24: 15%). The general insurance segment booked RM1.7 billion in insurance revenue in 1H25, up 14% YoY from higher recognition from the motor and fire businesses. An improved claims experience (+2% YoY) ensured an easing of the reported combined ratio by 1.5ppts YoY to 87%. As at Jun 2025, AGIC remains the market leader in the domestic general insurance segment with a 15.1% market share, a marginal uptick from 14.9% in the previous quarter. Recall that in April 2025, ALIM had repriced a large block of policies by the maximum allowable 10%. This was reflected in the strong new business value of RM171 million generated in Q2’25 (up 37% YoY and 43% QoQ), which pushed the contractual service margin (CSM) balance up 5% YoY to RM3.6 billion (QoQ: +3%). Elsewhere, while the segment was impacted by an upwards normalisation of incurred claims (+1% YoY, +17% QoQ), this was largely mitigated by higher net investment income of RM89 million, from a net loss of RM32 million in Q1’25. NEUTRAL with RM19.60 TP. – RHB Research, Aug 26