PETALING JAYA: Kobay Technology Bhd
expects the issues of incubation stages for its two new projects – the electronic manufacturing system (EMS) and solar panels – to be resolved soon.
This would impact positively on the group’s manufacturing division which has incurred pre-operational costs of RM6mil over the past two quarters, it said.
The slowdown of the semiconductor market and softened new orders had also held down its manufacturing division despite the healthy outlooks for the aerospace and oil and gas divisions.
Kobay, however, said the division performance would remain soft due to the weak global economic conditions, HLIB Research said in a report on the diversified group yesterday.
Kobay is ready to manufacture aluminium frames for solar panels as the renovation and installation of its new 15-acre plant dedicated to renewable energy-related business had completed.
The factory is connected to electricity supply after a substation upgrade by Tenaga Nasional Bhd, the research house added.
Kobay’s EMS business has been qualified by customers in the second quarter ended Dec 31, 2022 (2Q22) and is currently awaiting for orders to be released to kick start production.
HLIB Research noted that at this juncture, the group has secured two customers with a revenue guidance of RM1mil monthly.
Despite minimal contribution from the EMS division, Kobay planned to utilise its surface-mount technology line and achieve breakeven.
“From the groups’ observation, the electrical and electronics and semi segments still indicate a slowdown and to mitigate this, Kobay’s strategy is to look for customers and secure more projects,” HLIB Research pointed out.
Kobay’s 2Q23 results had missed HLIB Research’s estimates by 7% quarter-on-quarter and 21% on a yearly basis with a core net profit of RM10mil for the second quarter of financial year (2Q23) bringing 1H23’s sum to RM21mil.
On a positive note, Kobay’s property development business is expected to deliver positive performance on the completion of its maiden proejct in Langkawi, Kedah.
