Broker Name: CGS International
Date of Report: December 10, 2025
Excerpt from CGS International report.
Report Summary
- Inari-Amertron Bhd’s outlook for FY26 remains mixed due to weakness in its core RF segment, although this is balanced by positive growth prospects in datacom and power management divisions.
- The company has doubled its datacom plant capacity and established a silicon carbide (SiC) line for power management, positioning for AI-related demand.
- Despite losing RF assembly market share, Inari still commands about 80% of the final test market for its key US customer, supporting margins and earnings stability.
- The report upgrades Inari to a Hold with a higher target price of RM1.85, reflecting moderate earnings growth, solid cost controls, and an EBITDA margin above 20% despite volume challenges.
- Key upside risks include stronger RF volume loading, new product wins, and a stronger US dollar, while downside risks are continued RF market share losses and failure to scale new initiatives.
- Inari’s ESG practices are highlighted as best-in-class, with strong localisation efforts, independent audits, and proactive management of labour and automation trends.
- The company remains financially robust, with high cash levels, low gearing, and consistent dividend payouts, but 5-year earnings CAGR is muted at 1.4%.
Above is an excerpt from a report by CGS International. Clients of CGS International can be the first to access the full report from the CGS International website: https://www.cgsi.com
