CORAZA: Strong Outlook Projected on Robust Order Book and Capacity Expansion
| Investment Bank | TA SECURITIES |
|---|---|
| TP (Target Price) | RM0.70 (+33.3%) |
| Last Traded | RM0.525 |
| Recommendation |
Optimism prevails regarding the future prospects of the integrated technology company, following an analyst briefing by TA Securities. The investment bank highlighted a robust order book estimated at RM90.0 million and management’s ambitious target for record-high revenue in the financial year 2025 (FY25).
Performance & Outlook
Management expressed a positive outlook for the final quarter of FY25, underpinning their goal for record revenue. For context, the company’s previous record revenue was RM143.3 million in FY22. In the third quarter of FY25, the sheet metal fabrication segment continued to be the primary revenue driver, contributing 89.3% of total revenue, despite a guided utilization rate of 50-60% for this segment.
Strategic Growth Initiatives
The aerospace business is notably gaining traction, although its current revenue contribution remains minor. The group is actively working with an aerospace customer on the final qualification of a key part, with the potential for one or two products to enter mass production next year. This development is expected to deliver more meaningful contributions to revenue in the coming year.
Furthermore, the new P3 plant, located in Nibong Tebal, Penang, has been completed and is scheduled for full handover by the end of December 2025. This expansion will add approximately 83,000 square feet of production floor space. Management is already in discussions with two new multinational customers from the semiconductor segment to utilize this additional capacity, signaling strong demand and future growth.
Analyst’s View
TA Securities reiterated its “Buy” recommendation for the stock, maintaining an unchanged target price of RM0.70. This valuation is based on an unchanged 22 times projected CY26 earnings. The firm’s positive stance is underpinned by the company’s ongoing capacity expansion and its strategic exposure to high-growth sectors, including semiconductors, instrumentation, and medical and life sciences.
