Despite a record 3QFY2021 ended March for Micro-Mechanics (Holdings), PhillipCapital analyst Paul Chew has maintained his ‘neutral’ rating for the counter after 9MFY2021 revenue and net profit came below his forecasts for the year at 77% and 64% respectively.

Chew believes that semiconductor supply disruption, particularly in Taiwan and the US, resulted in the lower-than-expected revenue of $17.7 million for the 3QFY2021. “Countries with more automobile exposure suffered from disruption in chip supply,” he notes in a May 2 research note.

In addition, the gross margin of 53.9% for the period was also below his estimates. “We had expected record revenue and increased product complexity to lift margins, mirroring its FY17-18 upcycle when margins were 57% and capacity utilisation [was at] 60%. Current utilisation is only 56%,” he explains.

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