HLIB maintained its BUY call on Yenher Holdings Bhd with an unchanged target price of RM1.37, implying 69.1% upside from RM0.81, after the animal health products maker posted record quarterly earnings.
HLIB said 2QFY26 core PATAMI of RM6.9 million was within expectations, bringing 1HFY26 core PATAMI to RM12.4 million, up 17.2% year-on-year.
The stronger quarter was driven by robust feed-additive distribution sales as customers stocked up amid war-related supply disruptions. This helped cushion weaker premix exports to the Middle East, where demand was affected by the same conflict. Revenue was largely flat year-on-year but higher-margin feed additives lifted the distribution gross profit margin to 18.4% from 10.6% previously.
HLIB said the stronger momentum is expected to continue into July before normalising from August, while Middle Eastern export sales could recover in the fourth quarter as supply disruptions ease and customers replenish inventories.
The research house also highlighted Yenher’s expansion plans, with its 60%-owned black soldier fly farm beginning operations in June and expected to be fully commissioned by early FY27. A new premix plant with around three times current capacity, a new complete feed plant and a biotech feed additive joint venture are also expected to begin operations by year-end.
HLIB expects these new facilities to support a multi-year growth phase and retained its earnings forecasts, with the target price based on a 16 times price-to-earnings multiple.
As of 11.10 am, the stock price is flat at RM0.81.
