PIE Industrial Bhd’s near-term earnings growth prospects remain muted as earlier high tariffs delayed customer negotiations and caused a key client to shift production to Indonesia, according to Maybank Investment Bank (Maybank IB).
The research house said that while Malaysia’s tariff rate has now been reduced from 25% to 19% — matching rates in neighbouring countries — recovery in orders is only expected by the fourth quarter of 2025.
One major setback came from PIE’s supercomputer customer, which accounted for 35% of the group’s first-half FY25 revenue. When Indonesia secured the lower tariff ahead of Malaysia, this customer diverted all outstanding orders to an Indonesian electronics manufacturing services (EMS) provider.
Management is currently negotiating to reclaim the lost volumes, but Maybank IB noted that the earliest recovery would be in 4Q25. The company’s P5 plant expansion, initially slated for completion in 3Q25, has also been pushed back to 4Q25.
On a more positive note, discussions with prospective customers seeking to diversify production from China and Vietnam have resumed following the tariff cut, although onboarding timelines remain uncertain. Existing key customers have also resumed order loadings, which Maybank IB estimates should help PIE secure quarterly revenues of over RM150 million in FY25.
The investment bank is maintaining its forecasts and a HOLD rating on PIE, with a target price of RM3.56 based on a 17 times FY26E PER at -0.5 standard deviation from the five-year forward mean.
“Until there is clearer visibility on order recovery and new customer wins, we prefer to stay neutral,” Maybank IB said, adding that downside risks include prolonged onboarding delays, weaker demand, order losses, and labour shortages. Upside could come from faster-than-expected customer onboarding or a stronger rebound in order loadings.
