♦ Higher costs. The company’s initial capex of RM80m was to expand
capacity for the 2.5’’ baseplate capacity to 5m/month in FY9/11 and
7m/month in FY9/12. However, due to higher-than-expected rejected rates,
management now expects to hold production capacity at 2m/month in
FY9/11. We believe the excess capacity and operational issues will dampen
the earnings outlook in the medium term. Management stated that it will
review plans for the 2.5” baseplate, and potentially “cut loss” on the project
within the next nine months.
Notion Vtec Berhad : Limited Visibility - 09/08/2010
Showing posts with label Notion Vtec. Show all posts
Showing posts with label Notion Vtec. Show all posts
Monday, August 9, 2010
Friday, August 6, 2010
Notion Vtec Berhad : Worse Than Feared - 06/08/2010
♦ Below expectations. 9MFY09/10 net profit of RM22.9m was below our and consensus expectations, accounting for 71.1% and 55.8% of our fullyear and consensus forecast respectively. The key variance was due to:
1) higher-than-expected costs; and 2) stronger RM vs. US$.
Notion Vtec Berhad : Worse Than Feared - 06/08/2010
1) higher-than-expected costs; and 2) stronger RM vs. US$.
Notion Vtec Berhad : Worse Than Feared - 06/08/2010
Tuesday, August 3, 2010
Notion Vtec Berhad : Not As Good As Hoped - 03/08/2010
Warning for 3Q results. The market yesterday beat us to the punch, de-rating Notion’s share price by 10.3%. We believe 3QFY9/10 results (to be announced on 5 Aug) are likely to be worse than expected due to higher costs incurred from the RM80m expansion of the 2.5” Hard-Disk Drive (HDD) baseplate capacity and lower revenue after adjusting for the weaker US$ vs. RM. Conditions are not expected to improve in 4QFY9/10.
Notion Vtec Berhad : Not As Good As Hoped - 03/08/2010
Notion Vtec Berhad : Not As Good As Hoped - 03/08/2010
RHB Equity 360° - 3 August 2010 (PLUS, Semicon, Notion Vtec, Unisem, Axiata, AMMB; Technical: MPHB, KNM)
Top Story : PLUS – Expecting strong 2QFY12/10 performance - Outperform
Results Preview
- We believe 2QFY12/10 results will likely to come in stronger (both yoy and qoq), thanks to the encouraging growth registered at PLUS's core expressways in 2QFY12/10 (+10.5% yoy and 5.8% qoq).
- Based on an actual traffic volume of 4,069.9m PCU-km registered at PLUS's core expressways in 2QFY12/10, we believe PLUS will likely to register a net profit of RM321.7m in 2QFY12/10.
- This means PLUS's 1HFY12/10 net profit is likely to come in at RM620.8m, which is 50.6-50.7% of our fullyear forecast and the full-year market consensus.
- DCF-derived fair value is RM4.33 (based on WACC of 7.7%).
RHB Equity 360° - 3 August 2010 (PLUS, Semicon, Notion Vtec, Unisem, Axiata, AMMB; Technical: MPHB, KNM)
Results Preview
- We believe 2QFY12/10 results will likely to come in stronger (both yoy and qoq), thanks to the encouraging growth registered at PLUS's core expressways in 2QFY12/10 (+10.5% yoy and 5.8% qoq).
- Based on an actual traffic volume of 4,069.9m PCU-km registered at PLUS's core expressways in 2QFY12/10, we believe PLUS will likely to register a net profit of RM321.7m in 2QFY12/10.
- This means PLUS's 1HFY12/10 net profit is likely to come in at RM620.8m, which is 50.6-50.7% of our fullyear forecast and the full-year market consensus.
- DCF-derived fair value is RM4.33 (based on WACC of 7.7%).
RHB Equity 360° - 3 August 2010 (PLUS, Semicon, Notion Vtec, Unisem, Axiata, AMMB; Technical: MPHB, KNM)
Thursday, May 20, 2010
Notion Vtec Berhad : Set To Deliver - 20/5/2010
On track to deliver 2.5" baseplate target. According to management, construction work on its new 150k sq ft plant is near completion. The new plant which is expected to house most of the base plate production capacity is set to commence production by Sep-10. Note that management expects capex of around RM80m to ramp up the base plate capacity to 1m/month, 5m/month, and 7m/month by FY10-12 respectively from 350-400k/month (currently) vs. 100k/month in Jan-10, pending the arrival of additional equipment and machinery i.e. die casting and computer numerical control (CNC) machines. Additionally, management is planning to increase the total workforce to 3,000 by 2011 (vs. 1,900 currently).
Notion Vtec Berhad : Set To Deliver - 20/5/2010
Notion Vtec Berhad : Set To Deliver - 20/5/2010
RHB Equity 360° - 20 May 2010 (Notion Vtec, Kencana, Media Prima, Amway; Technical: IOI, FBM KLCI)
Visit Note
♦ Construction work on its new 150k sq ft plant is set to commence production by Sep-10. Note that management expects capex of around RM80m to ramp up the base plate capacity to 1m/month, 5m/month, and 7m/month by FY10-12 respectively from 350-400k/month (currently) vs. 100k/month in Jan-10.
♦ Also, the company expects stronger volume loading in 2H2010 from WD on the back of strong demand for HDD components. Recall that WD overtook Seagate as the No. 1 HDD vendor in 1Q10. WD now expects to increase its total HDD shipments by more than 20%. While currently capacities for these components are 800-900k/month, management is expecting to increase capacity to 1.5-2.0m/month by end-2010.
♦ In the anticipation of higher costs this year stemming from higher start-up costs and product testing, we have trimmed our FY10 net profit forecast by 4.3% to RM53.6m. However, given stronger volume loading as well as lower cost stemming from tight cost control and higher utilisation rate, we have tweaked upwards our FY11-12 net profit by 0.8% respectively.
♦ Separately, assuming completion of the proposed 10% placement and rights issue of free warrants, we estimate FY11 fully-diluted EPS of 38.5 sen, i.e. a dilution of 17.7% from our current forecast, while our fair value would fall to RM3.85. Nevertheless, this would still imply 41% upside from current levels.
♦ After revision in earnings, our fair value is raised to RM4.68 from RM4.64. Maintain Outperform.
RHB Equity 360° - 20 May 2010 (Notion Vtec, Kencana, Media Prima, Amway; Technical: IOI, FBM KLCI)
♦ Construction work on its new 150k sq ft plant is set to commence production by Sep-10. Note that management expects capex of around RM80m to ramp up the base plate capacity to 1m/month, 5m/month, and 7m/month by FY10-12 respectively from 350-400k/month (currently) vs. 100k/month in Jan-10.
♦ Also, the company expects stronger volume loading in 2H2010 from WD on the back of strong demand for HDD components. Recall that WD overtook Seagate as the No. 1 HDD vendor in 1Q10. WD now expects to increase its total HDD shipments by more than 20%. While currently capacities for these components are 800-900k/month, management is expecting to increase capacity to 1.5-2.0m/month by end-2010.
♦ In the anticipation of higher costs this year stemming from higher start-up costs and product testing, we have trimmed our FY10 net profit forecast by 4.3% to RM53.6m. However, given stronger volume loading as well as lower cost stemming from tight cost control and higher utilisation rate, we have tweaked upwards our FY11-12 net profit by 0.8% respectively.
♦ Separately, assuming completion of the proposed 10% placement and rights issue of free warrants, we estimate FY11 fully-diluted EPS of 38.5 sen, i.e. a dilution of 17.7% from our current forecast, while our fair value would fall to RM3.85. Nevertheless, this would still imply 41% upside from current levels.
♦ After revision in earnings, our fair value is raised to RM4.68 from RM4.64. Maintain Outperform.
RHB Equity 360° - 20 May 2010 (Notion Vtec, Kencana, Media Prima, Amway; Technical: IOI, FBM KLCI)
Tuesday, May 4, 2010
Corporate Highlights - 3/5/2010
♦ Oil & Gas
Sector Update : Upturn In FPSO Market
♦ Banking
Sector Update : Mar ‘10 System Data – Underlying Trends Still Positive
Corporate Highlights - 3/5/2010
Sector Update : Upturn In FPSO Market
♦ Banking
Sector Update : Mar ‘10 System Data – Underlying Trends Still Positive
Corporate Highlights - 3/5/2010
Monday, May 3, 2010
Notion Vtec Berhad : Rapid Expansion Ahead - 3/04/2010
Briefing highlights – Positive revenue and earnings outlook.
Management expects revenue and profit to grow over the next two years on the back of: 1) stronger-than-expected demand for mobile computing and consumer electronics; and 2) higher utilisation rate for the camera segment as demand for SLR cameras picks up. We note that the 2QFY10 utilisation rates for HDD and the camera segments were 90% and 50% respectively.
Notion Vtec Berhad : Rapid Expansion Ahead - 3/04/2010
Management expects revenue and profit to grow over the next two years on the back of: 1) stronger-than-expected demand for mobile computing and consumer electronics; and 2) higher utilisation rate for the camera segment as demand for SLR cameras picks up. We note that the 2QFY10 utilisation rates for HDD and the camera segments were 90% and 50% respectively.
Notion Vtec Berhad : Rapid Expansion Ahead - 3/04/2010
RHB Equity 360° - 3 May 2010 (O&G, Banks, Notion Vtec, MAS; Technical: Maybank, Genting)
Top Story : Oil & Gas – Upturn in FPSO market Overweight
Sector Update
♦ According to Fred Olsen (a Norwegian floater specialist), the marked recovery is a continuation of the pickup in activity since 4Q 2009 which saw the award of seven contracts followed by another four contracts in Jan-Feb 2010. Going forward, we believe the market for FPSO is on track for a strong rebound driven mainly by: 1) stronger E&P spending beginning 2H 2010; and 2) increase in deepwater E&P activities.
♦ We highlight the potential shortages for the ‘High Case’ forecast of around 25-30 vessels p.a. in 2010-11, in the event of stronger-than-expected demand stemming from increased E&P activity in deepwater and ultradeepwater fields (Brazil, Africa, Malaysia, Vietnam and Gulf of Mexico). Hence, we expect FPSO charter rates to rise significantly over the next two years, driven by strong demand amidst a shortage of supply in the market.
RHB Equity 360° - 3 May 2010 (O&G, Banks, Notion Vtec, MAS; Technical: Maybank, Genting)
Sector Update
♦ According to Fred Olsen (a Norwegian floater specialist), the marked recovery is a continuation of the pickup in activity since 4Q 2009 which saw the award of seven contracts followed by another four contracts in Jan-Feb 2010. Going forward, we believe the market for FPSO is on track for a strong rebound driven mainly by: 1) stronger E&P spending beginning 2H 2010; and 2) increase in deepwater E&P activities.
♦ We highlight the potential shortages for the ‘High Case’ forecast of around 25-30 vessels p.a. in 2010-11, in the event of stronger-than-expected demand stemming from increased E&P activity in deepwater and ultradeepwater fields (Brazil, Africa, Malaysia, Vietnam and Gulf of Mexico). Hence, we expect FPSO charter rates to rise significantly over the next two years, driven by strong demand amidst a shortage of supply in the market.
RHB Equity 360° - 3 May 2010 (O&G, Banks, Notion Vtec, MAS; Technical: Maybank, Genting)
Friday, April 30, 2010
Notion Vtec Berhad : Proposes Private Placement and Warrants Issue - 30/04/2010
2QFY10 results in line. 1HFY09/10 net profits were in line with our expectations and market consensus, accounting for 47% and 50% of our full-year and market consensus respectively. While 2QFY09/10 revenue remained resilent qoq, net profit dropped arginally qoq due to: 1) seasonal factors; and 2) higher expenses incurred from the capacity ramp up coming into 2Q.
Notion Vtec Berhad : Proposes Private Placement and Warrants Issue
Notion Vtec Berhad : Proposes Private Placement and Warrants Issue
RHB Equity 360° - 30 April 2010 (Market, CSC Steel, Notion Vtec; Technical: Perisai)
Top Story : Taking Stock – Position for more volatility ahead
Market Update
- We expect the market volatility to continue due to changing external factors including rising interest rates, fluctuating exchange rates, rising commodity prices, and balanced against the global economic recovery.
- We caution that May has tended to be volatile with the FBM EMAS and FBM KLCI showing a decline for end-May vs. end-Apr prices in six out of the last 10 years. The 2010 FIFA World Cup in South Africa in Jun/Jul could also have a negative impact. Price charts for the last five World Cup years indicate the FBM EMAS and FBM KLCI generally having a downswing in the early part of each event
RHB Equity 360° - 30 April 2010 (Market, CSC Steel, Notion Vtec; Technical: Perisai)
Market Update
- We expect the market volatility to continue due to changing external factors including rising interest rates, fluctuating exchange rates, rising commodity prices, and balanced against the global economic recovery.
- We caution that May has tended to be volatile with the FBM EMAS and FBM KLCI showing a decline for end-May vs. end-Apr prices in six out of the last 10 years. The 2010 FIFA World Cup in South Africa in Jun/Jul could also have a negative impact. Price charts for the last five World Cup years indicate the FBM EMAS and FBM KLCI generally having a downswing in the early part of each event
RHB Equity 360° - 30 April 2010 (Market, CSC Steel, Notion Vtec; Technical: Perisai)
Monday, April 26, 2010
Corporate Highlights... - 26/04/2010
♦ Fajarbaru Builder Group
Results Preview : 9MFY06/10 Results To Beat Our Expectation
♦ Construction
Sector Update : Twelve Bidders Shortlisted For Langat 2?
♦ Hong Leong Bank
News Update : Proposing Capital Raising Exercise Of Up To RM3.4bn
♦ Genting Malaysia
News Update : Another MGM Notes Investment of US$48m
♦ Notion Vtec
Results Preview : Stronger Demand Ahead
Corporate Highlights...-26/04/2010
Results Preview : 9MFY06/10 Results To Beat Our Expectation
♦ Construction
Sector Update : Twelve Bidders Shortlisted For Langat 2?
♦ Hong Leong Bank
News Update : Proposing Capital Raising Exercise Of Up To RM3.4bn
♦ Genting Malaysia
News Update : Another MGM Notes Investment of US$48m
♦ Notion Vtec
Results Preview : Stronger Demand Ahead
Corporate Highlights...-26/04/2010
Notion Vtec Berhad : Stronger Demand Ahead - 26/04/2010
2QFY10 results preview. Notion Vtec (NVB) will release its 2QFY10 results on 29 April. We estimate net earnings to fall marginally 5-7% qoq vs. +9.2% qoq) to around RM13m due to:
1) seasonal factors;
2) strengthening of RM against the USD (+4.3% qoq); and
3) higher expenses stemming from the capacity ramp up in 2Q.
This would bring 1HFY10 net profit to around 54-55% of our full-year net profit forecast and around 53- 54% of consensus estimates. However, we expect a strong qoq growth in 3Q-4Q10, driven mainly by:
1) higher volume loading of base plates from Samsung and strong contribution from higher margin spindle motor hub.
Notion Vtec Berhad : Stronger Demand Ahead-26/04/2010
1) seasonal factors;
2) strengthening of RM against the USD (+4.3% qoq); and
3) higher expenses stemming from the capacity ramp up in 2Q.
This would bring 1HFY10 net profit to around 54-55% of our full-year net profit forecast and around 53- 54% of consensus estimates. However, we expect a strong qoq growth in 3Q-4Q10, driven mainly by:
1) higher volume loading of base plates from Samsung and strong contribution from higher margin spindle motor hub.
Notion Vtec Berhad : Stronger Demand Ahead-26/04/2010
RHB Equity 360° (Fajarbaru, Construction, HL Bank, Genting Malaysia, Notion Vtec; Technical: CMS, MPI) -26/04/2010
Top Story : Fajarbaru – 9MFY06/10 results to beat our expectation Outperform
Results Preview
♦ We expect Fajarbaru’s 9MFY06/10 net profit to come in above our expectation driven largely by higher than- expected margins from key on-going construction projects.
♦ However, it appears that Fajarbaru is unlikely to meet our FY06/10 new orderbook target of RM400m. So far in FY06/10, Fajarbaru has only managed to secure RM70m.
♦ We are raising FY06/10 net profit forecast by 9% largely to reflect a higher blended margin of 15% vis-Ã -vis 11.3% previously. However, FY06/11-12 net profit forecasts are cut by 11-13% largely to reflect the impact of the shortfall in new contracts secured in FY06/10.
♦ Fair value is trimmed slightly from RM1.35 to RM1.31. Maintain Outperform.
RHB Equity 360° (Fajarbaru, Construction, HL Bank, Genting Malaysia, Notion Vtec; Technical: CMS, MPI) -26/...
Results Preview
♦ We expect Fajarbaru’s 9MFY06/10 net profit to come in above our expectation driven largely by higher than- expected margins from key on-going construction projects.
♦ However, it appears that Fajarbaru is unlikely to meet our FY06/10 new orderbook target of RM400m. So far in FY06/10, Fajarbaru has only managed to secure RM70m.
♦ We are raising FY06/10 net profit forecast by 9% largely to reflect a higher blended margin of 15% vis-Ã -vis 11.3% previously. However, FY06/11-12 net profit forecasts are cut by 11-13% largely to reflect the impact of the shortfall in new contracts secured in FY06/10.
♦ Fair value is trimmed slightly from RM1.35 to RM1.31. Maintain Outperform.
RHB Equity 360° (Fajarbaru, Construction, HL Bank, Genting Malaysia, Notion Vtec; Technical: CMS, MPI) -26/...
Monday, March 15, 2010
Corporate Highlights - 15/03/2010
♦ Notion Vitec : Moving Up The Value Chain
♦ MBM Resources : Entered Into Distributorship/Dealership Agreements
♦ Market Technical Reading : Revisiting The 1,300 Stronghold...
♦ Cahya Mata Sarawak : An Opportunity To Bargain Buy Near RM2.10...
♦ Commodities & Currencies : More Weakness On The US$ Imminent This Week…
Corporate Highlights - 15/03/2010
♦ MBM Resources : Entered Into Distributorship/Dealership Agreements
♦ Market Technical Reading : Revisiting The 1,300 Stronghold...
♦ Cahya Mata Sarawak : An Opportunity To Bargain Buy Near RM2.10...
♦ Commodities & Currencies : More Weakness On The US$ Imminent This Week…
Corporate Highlights - 15/03/2010
Notion Vtec Berhad : Moving Up The Value Chain - 15/03/2010
Global Supplier. Notion Vtec Berhad (Notion) supplies high precision components to the world’s biggest manufacturers such as Western Digital, Seagate, Hitachi, Nikon, and Continental. The company drives on technology-based equipment. The company has 3 main business segments:
1) hard disk drives (HDD);
2) Camera; and
3) Auto & Industrial.
Notion Vtec Berhad : Moving Up The Value Chain - 15/03/2010
1) hard disk drives (HDD);
2) Camera; and
3) Auto & Industrial.
Notion Vtec Berhad : Moving Up The Value Chain - 15/03/2010
RHB Equity 360° (Notion, MBM; Technical: Tan Chong, Cahya Mata Sarawak) - 15/03/2010
Top Story : Notion Vtec – Moving Up the Value Chain Outperform
New Coverage
- Notion Vtec (Notion) is an integrated precision engineering specialist and tools maker.
- Notion is expected to extensively produce for Samsung 2.5" baseplates components with initial production of 100K units per/month rising sharply to 1m units per/month (by June) and 2m pieces per/month by end-2010 respectively. We expect this to grow significantly in FY11-12 as Notion steps-up its capability to produce higher-value components.
- Recall that Nikon acquired a 8.98% via a private placement exercise raised about RM33.8m. The proceeds will be used for its plant in Thailand with plans for further expansion. We expect Notion Nikon to further develop its expertise and technical know-how in order to service Nikon which will further improve production efficiently.
- We estimate revenue growth in FY10, FY11, and FY12 to driven mainly by: 1) stronger demand in the 2.5" HDD segment particularly the robust orders from Samsung; and 2) stronger contribution from its camera division given volume loading from Nikon.
- We estimate a fair value of RM 4.59 based on 10x FY11 EPS. Initiate coverage with an Outperform recommendation.
RHB Equity 360° (Notion, MBM; Technical: Tan Chong, Cahya Mata Sarawak) - 15/03/2010
New Coverage
- Notion Vtec (Notion) is an integrated precision engineering specialist and tools maker.
- Notion is expected to extensively produce for Samsung 2.5" baseplates components with initial production of 100K units per/month rising sharply to 1m units per/month (by June) and 2m pieces per/month by end-2010 respectively. We expect this to grow significantly in FY11-12 as Notion steps-up its capability to produce higher-value components.
- Recall that Nikon acquired a 8.98% via a private placement exercise raised about RM33.8m. The proceeds will be used for its plant in Thailand with plans for further expansion. We expect Notion Nikon to further develop its expertise and technical know-how in order to service Nikon which will further improve production efficiently.
- We estimate revenue growth in FY10, FY11, and FY12 to driven mainly by: 1) stronger demand in the 2.5" HDD segment particularly the robust orders from Samsung; and 2) stronger contribution from its camera division given volume loading from Nikon.
- We estimate a fair value of RM 4.59 based on 10x FY11 EPS. Initiate coverage with an Outperform recommendation.
RHB Equity 360° (Notion, MBM; Technical: Tan Chong, Cahya Mata Sarawak) - 15/03/2010