Mercury Securities has initiated coverage on P.I.E. Industrial Bhd with a BUY recommendation with a TP of RM4.59 based on FY24F EPS 30.2 sen and PE of 15.2x in line with the 10-years average.
It said that it likes the stock for its attractive dividend yield, 3-year CAGR forward earnings of 24.4% from FY21 to FY24F, and cheap valuations.
One-stop integrated EMS provider. PIE is a one-stop integrated electronic manufacturing service (EMS) provider, capable of providing one-stop EMS to MNCs with the services of manufacturing and assembly of wire and cables, fabrication of moulds and dies, printed circuit board (PCB) assembly using precision SMT, testing of electronic products, plastic injection moulding, and Class 10K and 100K clean room product assembly.
With the strong support from Foxconn Technology Group, which is PIE’s indirect major shareholder, the company can benefit from its network to improve its profit margins by leveraging on the raw materials.
In tandem with the expansion plans, Mercury Securities said that the company plans to hire more workers, expected to arrive in 3Q22. Running at double shifts on 24 hours a day, we expect an RM150million worth of backlog orders to be cleared by end of FY22.
