See: Frencken Group sees 5.2% growth in 2H20 earnings of $23.8 mil; profit holds steady in FY20 despite slight dip in revenue
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According to Seet, the group’s medical and semiconductor segment continues to enjoy strong growth. “Frencken continues to enjoy larger medical orders relating to computed tomography or CT scans and other scanning-related equipment. The company’s clients have reduced the number of manufacturers, place larger orders and new products to the manufacturers retained, which yield higher margins. Frencken stands to benefit from this trend,” notes Seet. Meanwhile, the company management is remaining bullish also on its semiconductor segment, as most areas of the segment will likely grow strongly y-o-y in FY2021, says Seet. The group’s automotive segment is estimated to be stronger y-o-y despite a chip shortage, says Seet. Despite a lack of orders placed forward due to the downtown in the automotive sector in 2020 and chips being allocated to other sectors, Frencken Group is optimistic that this situation will be resolved and volumes will resume back to higher levels due to the stronger demand.
See also: Maybank Kim Eng maintains 'buy' on Frencken as 2H20 earnings beat expectations