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‘Wait and see’ stance for Avi-Tech as it grapples with chip shortage: RHB

Lim Hui Jie
Lim Hui Jie8/25/2021 11:22 AM GMT+08  • 2 min read
‘Wait and see’ stance for Avi-Tech as it grapples with chip shortage: RHB
RHB has maintained its 'neutral' call on Avi-Tech, as it does not expect any recovery in its burn-in segment till 2HFY2022.
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RHB Group Research’s Jarick Seet has maintained his “neutral” call on Avi-Tech Electronics after it saw a 41.7% drop in profit after tax & minority interests (PATMI) in its FY2020 ending June 30.

In a Aug 25 report, Seet gave an unchanged target price of 42 cents, saying that the drop was due to the drop in its high-margin burn-in revenue.

This, in turn, stemmed from the chip shortage in the automotive sector. Seet writes, “we expect the chip shortage to last until 2QFY2022, and prefer to adopt a wait-and-see approach for now. The end of this shortage should be crucial for the recovery of its burn-in business.”

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