PUBLIC INVESTMENT BANK
PublicInvest Research Results Review
KDN PP17686/03/2013 (032117)
MI TECHNOVATION
DESCRIPTION
Mi Technovation is principally involved in the in-house design, development, manufacturing and sale of wafer level chip scale packaging sorting machines
RM2.47
RM2.10
+17.6%
RM2.47
Main
Technology
5286
MI MK
Yes
SHARE PRICE CHART
52 Week Range (RM) 1.40-2.78
3-Month Average Vol (‘000) 1,064.0
| SHARE PRICE PERFORMANCE | 1M | 3M | 6M |
|---|---|---|---|
| Absolute Returns | 23.6 | -5.4 | 6.0 |
| Relative Returns | 7.5 | -8.3 | 4.2 |
| KEY STOCK DATA | |
|---|---|
| Market Capitalisation (RM m) | 1,646.6 |
| No. of Shares (m) | 890.0 |
| MAJOR SHAREHOLDERS | |
|---|---|
| % | |
| Oh Kuang Eng | 45.0 |
| Yong Shiao Voon | 11.3 |
Record Quarter
Excluding non-core items, namely (i) net foreign exchange (FX) loss of RM18m and (ii) minority interests of RM0.2m, Mi Technovation delivered a stronger set of results for 1HFY25 with a core profit of RM47m, up 5.9% YoY. The improvement was primarily driven by stronger semiconductor equipment earnings. Results exceeded both our and the street’s expectations, accounting for 60% and 69% of full-year forecasts, respectively. It is worth noting that the new business, Semiconductor Solution Business Unit (SSBU) incurred YTD start-up losses of RM10.6m. Pending further updates from the analyst briefing today, we maintain our Outperform call with an unchanged TP of RM2.47, based on 27x FY26 EPS. A first DPS of 1sen was declared for the quarter.
2QFY25 revenue climbed 21.2% YoY. The increase in revenue was driven by both the SEBU and the Semiconductor Material Business Unit (SMBU) segments. SEBU sales increased by 23.1% to RM88.5m, attributed to higher demand for Mi Series Die Sorter machines for the Mobility & Wearables and High-Performance Computing (HPC) & Memory segment in the Southeast Asia market. SMBU sales climbed 25.2% YoY to RM65.6m due to the increased sales demand in solder balls from both China and Korean markets for the i) Mobility & Wearables, ii) HPC & Memory, and iii) Automotive & Renewable Energy segments. The Hangzhou-based SSBU, which is mainly involved in i) motor control unit, ii) power distribution model and iii) network control unit for commercial vehicles, booked in a small revenue of RM78k.
Highest ever quarterly profit. Excluding (i) net FX loss of RM16.7m and (ii) minority interest gains of RM0.5m, core profit rose from RM26.4m to a record high of RM28.6m. This was driven by stronger SEBU earnings (+3.6% YoY), partially offset by weaker SMBU earnings (-31.2% YoY). EBITDA margin declined from 23.5% to 12.5%, mainly due to FX losses. SSBU incurred start-up losses of RM5.6m, primarily from higher R&D staffing and related development costs. Meanwhile, the 90%-owned Mi Korea had turned profitable, while 30.75%-owned Talentek posted a marginal loss of RM0.2m.
Eyeing continuous growth in 3Q. Management expects SEBU momentum to remain strong in 3QFY25, underpinned by resilient demand from the Mobility & Wearables segment and robust sales of HPC & Memory Mi Series Die Sorters. SMBU is projected to post modest growth in FY25, supported by increasing adoption of specialty alloys by IDM and OSAT customers. Stronger growth is also anticipated from the HPC & Memory segment, driven by the global acceleration of AI applications that require high-performance GPUs and high-bandwidth memory technologies. Lastly, SSBU has completed its first power module prototype using its in-house pilot production line in Hangzhou, with commercialisation targeted for 2027.
KEY FINANCIAL SUMMARY
| FYE Dec (RM m) | 2023A | 2024A | 2025F | 2026F | 2027F | CAGR |
|---|---|---|---|---|---|---|
| Revenue | 355.9 | 463.4 | 506.4 | 535.1 | 546.9 | 5.7% |
| Gross Profit | 110.3 | 161.3 | 176.2 | 186.8 | 190.9 | 5.8% |
| Pre-tax Profit | 65.5 | 90.6 | 97.7 | 102.1 | 105.8 | 5.3% |
| Core Net Profit | 45.3 | 73.5 | 78.2 | 81.7 | 84.7 | 4.8% |
| EPS (Sen) | 5.1 | 8.2 | 8.8 | 9.1 | 9.5 | 4.8% |
| P/E (x) | 38.3 | 23.6 | 22.2 | 21.2 | 20.5 | |
| DPS (Sen) | 4.0 | 4.0 | 4.0 | 4.0 | 4.0 | |
| Dividend Yield (%) | 2.1 | 2.1 | 2.1 | 2.1 | 2.1 |
Source: Company, PublicInvest Research estimates
| FY Dec (RM’m) | 2Q25 | 2Q24 | 1Q25 | QoQ chg (%) | YoY chg (%) | FY25 | FY24 | YoY chg (%) | Comments | |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | 154.1 | 127.1 | 119.5 | 29.0 | 21.2 | 273.6 | 234.3 | 16.8 | Driven by stronger sales from both equipment and material businesses | |
| Operating expenses | -112.8 | -94.0 | -89.8 | 25.6 | 20.0 | -202.6 | -178.9 | 13.2 | ||
| Gross profit | 41.3 | 33.1 | 29.7 | 39.1 | 24.8 | 71.0 | 55.4 | 28.2 | ||
| Share of results of associates | -0.2 | 0.0 | -0.7 | – | – | -0.9 | 0.0 | – | Due to losses from 30.75%-owned Talentek | |
| Net FX (loss)/gain | -16.8 | 1.3 | -1.3 | >100 | <-100 | -18.1 | 11.8 | <-100 | ||
| Other operating income | 2.1 | 2.0 | 0.3 | – | – | 5.0 | 2.4 | 3.1 | -22.6 | |
| Depreciation & Amortisation | -7.2 | -6.4 | -7.0 | 2.9 | 12.5 | -14.2 | -13.0 | 9.2 | ||
| Operating profit | 19.2 | 30.0 | 21.0 | -8.6 | -36.0 | 40.2 | 57.3 | -29.8 | ||
| Interest Income | 1.9 | 3.5 | 1.9 | 0.0 | -45.7 | 3.9 | 7.2 | -45.8 | ||
| Finance costs | -0.4 | -0.4 | -0.4 | 0.0 | 0.0 | -0.7 | -0.7 | 0.0 | ||
| Pre-tax profit | 20.7 | 33.1 | 22.5 | -8.0 | -37.5 | 43.4 | 63.8 | -32.0 | ||
| Income tax | -4.7 | -6.0 | -5.3 | -11.3 | -21.7 | -10.1 | -10.4 | -2.9 | ||
| Net profit | 16.0 | 27.1 | 17.2 | -7.0 | -41.0 | 33.3 | 53.4 | -37.6 | ||
| Core profit | 28.6 | 26.4 | 18.4 | 55.4 | 8.3 | 47.0 | 44.4 | 5.9 | After stripping out FX changes | |
| Core EPS (sen) | 3.2 | 3.0 | 2.1 | 55.4 | 8.3 | 5.3 | 5.0 | 5.9 | ||
| DPS (sen) | 1.0 | 2.5 | 0.0 | – | -60.0 | 1.0 | 2.5 | -60.0 | Ex-date: 28 Aug 2025 | |
| Gross Margin (%) | 26.8 | 26.0 | 24.9 | – | – | 26.0 | 23.6 | – | ||
| Pre-tax Margin (%) | 13.4 | 26.0 | 18.8 | – | – | 15.9 | 27.2 | – | ||
| Net Margin (%) | 18.6 | 20.8 | 15.4 | – | – | 17.2 | 19.0 | – | ||
| Effective tax rate (%) | 22.7 | 18.1 | 23.6 | – | – | 23.3 | 16.3 | – |
| Revenue by segment: | 2Q25 | 2Q24 | 1Q25 | QoQ chg (%) | YoY chg (%) | FY25 | FY24 | YoY chg (%) | Comments |
|---|---|---|---|---|---|---|---|---|---|
| Semiconductor Equipment Business | 88.5 | 71.9 | 73.0 | 21.2 | 23.1 | 161.5 | 133.3 | 21.2 | Supported by strong demand for Mi Series Die Sorter for the Mobility and HPC & Memory segments |
| Semiconductor Material Business | 65.6 | 52.4 | 46.5 | 41.1 | 25.2 | 112.1 | 98.2 | 14.2 | Underpinned by stronger orders from all segments |
| Semiconductor Solution Business Unit | 0.0 | 2.8 | 0.0 | – | – | 0.0 | 2.8 | – | Mainly from the sales of services and samples |
| 154.1 | 127.1 | 119.5 | 29.0 | 21.2 | 273.6 | 234.3 | 16.8 |
| Pre-tax profit by segment: | 2Q25 | 2Q24 | 1Q25 | QoQ chg (%) | YoY chg (%) | FY25 | FY24 | YoY chg (%) | Comments |
|---|---|---|---|---|---|---|---|---|---|
| Semiconductor Equipment Business | 19.9 | 19.2 | 19.7 | 1.0 | 3.6 | 39.6 | 35.3 | 12.2 | |
| Semiconductor Material Business | 9.5 | 13.8 | 10.8 | -12.0 | -31.2 | 20.3 | 26.0 | -21.9 | |
| Semiconductor Solution Business Unit | -5.6 | 1.0 | -5.0 | – | – | -10.6 | 0.7 | – | Due to higher R&D staff costs and related development expenses |
| 23.8 | 33.0 | 25.5 | -6.7 | -27.9 | 49.3 | 61.3 | -19.6 |
KEY FINANCIAL DATA
INCOME STATEMENT DATA
| FYE Dec (RM m) | 2023A | 2024A | 2025F | 2026F | 2027F |
|---|---|---|---|---|---|
| Revenue | 355.9 | 463.4 | 506.4 | 535.1 | 546.9 |
| Gross Profit | 110.3 | 161.3 | 176.2 | 186.8 | 190.9 |
| EBIT | 67.3 | 92.3 | 99.4 | 103.8 | 107.5 |
| Finance costs | -1.8 | -1.7 | -1.7 | -1.7 | -1.7 |
| Pre-tax Profit | 65.5 | 90.6 | 97.7 | 102.1 | 105.8 |
| Income Tax | -12.8 | -23.9 | -19.5 | -20.4 | -21.2 |
| Effective Tax Rate (%) | 19.5 | 26.4 | 20.0 | 20.0 | 20.0 |
| Core Net Profit | 45.3 | 73.5 | 78.2 | 81.7 | 84.7 |
Growth (%)
| 2023A | 2024A | 2025F | 2026F | 2027F | |
|---|---|---|---|---|---|
| Revenue | -8.6 | 30.2 | 9.3 | 5.7 | 2.2 |
| Gross Profit | -13.2 | 37.1 | 7.7 | 4.4 | 3.6 |
| Core Net Profit | -20.5 | 26.6 | 17.2 | 4.4 | 3.7 |
Source: Company, PublicInvest Research estimates
BALANCE SHEET DATA
| FYE Dec (RM m) | 2023A | 2024A | 2025F | 2026F | 2027F |
|---|---|---|---|---|---|
| Fixed assets | 196.0 | 181.5 | 256.7 | 251.5 | 245.9 |
| Other long-term assets | 324.9 | 322.7 | 322.7 | 322.7 | 322.7 |
| Cash at bank | 422.7 | 344.7 | 287.3 | 322.2 | 369.9 |
| Other current assets | 278.1 | 329.9 | 360.1 | 380.0 | 388.3 |
| Total Assets | 1,221.7 | 1,178.8 | 1,226.9 | 1,276.4 | 1,326.8 |
| Short-term borrowings | 17.9 | 21.1 | 21.1 | 21.1 | 21.1 |
| Long-term borrowings | 18.4 | 10.6 | 10.6 | 10.6 | 10.6 |
| Payables | 50.1 | 61.1 | 66.8 | 70.5 | 72.0 |
| Other liabilities | 60.7 | 57.3 | 57.3 | 57.3 | 57.3 |
| Total Liabilities | 147.1 | 150.1 | 155.8 | 159.5 | 161.0 |
| Shareholder Equity | 1,074.6 | 1,028.7 | 1,071.1 | 1,117.0 | 1,165.8 |
| Total Equity and Liabilities | 1,221.7 | 1,178.8 | 1,226.9 | 1,276.4 | 1,326.8 |
Source: Company, PublicInvest Research estimates
PER SHARE DATA & RATIOS
| FYE Dec | 2023A | 2024A | 2025F | 2026F | 2027F |
|---|---|---|---|---|---|
| Book Value Per Share (RM) | 1.1 | 1.1 | 1.1 | 1.2 | 1.2 |
| NTA Per Share (RM) | 1.1 | 1.1 | 1.1 | 1.2 | 1.2 |
| EPS (sen) | 5.1 | 8.2 | 8.8 | 9.1 | 9.5 |
| DPS (sen) | 4.0 | 4.0 | 4.0 | 4.0 | 4.0 |
| Payout Ratio (%) | 79.0 | 48.7 | 45.8 | 43.8 | 42.3 |
| ROA (%) | 4.3 | 5.7 | 6.4 | 6.4 | 6.4 |
| ROE (%) | 4.9 | 6.5 | 7.3 | 7.3 | 7.3 |
Source: Company, PublicInvest Research estimates
DISCLAIMER
This document has been prepared solely for information and private circulation only. It is for distribution under such circumstances as may be permitted by applicable law. The information contained herein is prepared from data and sources believed to be reliable at the time of issue of this document. The views/opinions expressed herein are subject to change without notice and solely reflects the personal views of the analyst(s) acting in his/her capacity as employee of Public Investment Bank Berhad (“PIVB”). PIVB does not make any guarantee, representations or warranty neither expressed or implied nor accepts any responsibility or liability as to its fairness liability adequacy, completeness or correctness of any such information and opinion contained herein. No reliance upon such statement or usage by the addressee/anyone shall give rise to any claim/liability for loss of damage against PIVB, Public Bank Berhad, its affiliates and related companies, directors, officers, connected persons/employees, associates or agents.
This document is not and should not be construed or considered as an offer, recommendation, invitation or a solicitation of an offer to purchase or subscribe or sell any securities, related investments or financial instruments. Any recommendation in this document does not have regards to the specific investment objectives, financial situation, risk profile and particular needs of any specific persons who receive it. We encourage the addressee of this document to independently evaluate the merits of the information contained herein, consider their own investment objectives, financial situation, particular needs, risks and legal profiles, seek the advice of their, amongst others, tax, accounting, legal, business professionals and financial advisers before participating in any transaction in respect of any of the securities of the company(ies) covered in this document.
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