UOB Kay Hian analysts maintain their &ldquo buy call&rdquo and $1.03 target price for Valuetronics. According to analysts John Cheong and Heidi Mo, the company will see improved order flows and new customers amid easing trade tensions between the US and Vietnam, the latter of which is where Valuetronics&rsquo main manufacturing plant is sited.

 

UOB Kay Hian expect Valuetronics &ldquo to reap earnings growth in FY26 and beyond&rdquo due to its successful diversification of its customer base. New customers have contributed significantly to 1H26, Cheong and Mo note, and include a Canada-based industrial and commercial electronics company providing network access solutions and a consumer electronics company supplying to a leading global entertainment conglomerate.

 

Cheong and Mo also see the Valuetronics&rsquo high net cash position of HK$1.1 billion, equivalent to 50% of the company&rsquo s market cap, as a potential catalyst for the company. The cash can be used to finance share buybacks or be distributed as dividends, thus boosting shareholder returns.

 

UOB Kay Hian&rsquo s target price of $1.03 is based on 13x PE for FY2027 earnings, which is at +1SD above the mean. Cheong and Mo raised Valuetronics&rsquo target price to $1.03 in their Nov 14 note, a 24% increase from their previous target price of 83 cents.

 

Valuetronics is &ldquo currently trading at 12x FY27F PE, a significant 35% discount to Singapore peers&rsquo 19x PE,&rdquo Cheong and Mo write. T

 

he company&rsquo s dividend yield of around 6% is attractive, and is over 100% higher than the 1.4% peer average. &ldquo We believe valuations remain undemanding, given VALUE&rsquo s defensive earnings profile and strong cash generation,&rdquo they add.

The board declares an interim dividend of HK$0.04 per share and a special dividend of HK$0.04 per share

 

[SINGAPORE] Electronics manufacturing services provider   Valuetronics   : BN2 +0.6% on Wednesday (Nov 12) posted a first-half FY2026 net profit of HK$93 million (S$15.6 million). 

 

This was up 2.7 per cent from HK$90.5 million in the previous corresponding period. 

 

This translated to earnings per share (EPS) of HK$0.229, up from an EPS of HK$0.221 for the same period last year.

 

Revenue for H1 FY2026 stood at HK$836.6 million, down 3 per cent from HK$862.1 million in H1 FY2025.

 

The dip in overall revenue was attributed mainly to the 32.9 per cent fall in revenue from the consumer electronics segment to HK$129.9 million, due to the &ldquo continued decline in traditional consumer lifestyle products&rdquo . 

 

Such products have become &ldquo unattractive&rdquo due to low margins and insufficient scale, said Valuetronics. 

 

It added that it will continue to phase out these &ldquo legacy products&rdquo and expects to complete the process by the end of the current financial year. 

 

Still, Valuetronics said that it sees growth potential with its &ldquo entertainment-focused&rdquo consumer electronics segment, supported by the &ldquo growing global adoption&rdquo of immersive entertainment technologies in theme-park applications.

 

The industrial and commercial electronics segment, on the other hand, recorded a 5.7 per cent increase in revenue to HK$706.7 million. 

This was due to contributions from new customers, particularly those in network-access-solutions products and cooling solutions for high-performance computing environments.

 

Ricky Tse, chairman and managing director, noted: &ldquo In the longer term, we see growing potential from our new customers that offer modern-tech products.&rdquo

 

Gross profit margin for H1 FY2026 improved two percentage points to 18.8 per cent, which the group said was driven by its focus on strengthening customer acquisition and rebalancing its product portfolio towards higher-margin offerings.

 

An interim dividend of HK$0.04 per share was declared, on top of a special dividend of the same amount.

 

Valuetronics said that the macroeconomic and trade environment during the first half of the year was &ldquo highly uncertain&rdquo , pointing to US President Donald Trump&rsquo s reciprocal-tariff policy.

 

It added that subsequent negotiations, where Vietnam emerged with a lower tariff rate than China, underscored the importance of its Vietnam factory as an integral part of its regional manufacturing footprint. 

 

&ldquo Global inflationary pressures, geopolitical risks and supply-chain uncertainties will continue to weigh on business confidence,&rdquo pointed out Valuetronics. 

 

Still, the company expects to remain profitable for FY2026, barring any unforeseen macroeconomic disruptions. 

 

UOB Kay Hian analysts have kept their " buy" call on Valuetronicsfollowing a record FY2025. While there are broader trade uncertainties, the company is " cautiously optimistic" about its prospects thanks to new customers, according to analysts John Cheong and Heidi Mo, who have raised their target price from 78 cents to 83 cents.

 

For its FY2025, Valuetronics reported revenue of HK$1.79 billion, up 3.5% y-o-y. However, earnings grew at a faster pace of 6.8% y-o-y to HK$170.4 million thanks to a more favourable sales mix, which lifted gross margins to a record of 17%.

 

To cap it off, the company plans to pay a final dividend of 11 HK cents and a special dividend of 8 HK cents.

 

This brings the total for FY2025 to 27 HK cents - the highest payout since FY2018, " reflecting Valuetronic' s commitment to shareholder returns," state Cheong and Mo.

 

This current FY2026, the company expects to " remain profitable" despite the volatile trade environment fraught with tariff risks.

 

Cheong and Mo point out that the company' s integrated manufacturing base in Vietnam and " established core strengths" in China are seen to support " operational resilience" .

 

The analysts also note that many of the US customers have already shifted production from China to Vietnam.

 

" This early relocation has helped Valuetronics mitigate the impact of ongoing trade tensions," state Cheong and Mo.

 

Meantime, it is expanding its capacity in Vietnam by around 30% so as to be ready to support future orders fulfilment.

 

Another positive aspect of Valuetronics is its share HK$250 million share buyback programme which was introduced in Feb 2022, and which is continuing this current FY.

 

The analysts also observed that Valuetronics has maintained a strong net cash position of HK$1.1 billion, equal to two-thirds of its market cap, and has no borrowings.

 

The higher target price takes into account stronger demand from four new customers plus contributions from a joint venture.

 

Cheong and Mo note that Valuetronics is trading at only 3x FY2026 net cash PE and offers FY2026 yield of 6.8%.

The board has proposed a final dividend of HK$0.11 per share and a special dividend of HK$0.08 per share

 

[SINGAPORE] Electronics manufacturing services provider Valuetronics : BN2 -1.43% on Wednesday (May 28) posted net profit of HK$79.9 million (S$13.1 million), up 3.1 per cent from HK$77.4 million in the same year-ago period.

 

This translated to earnings per share (EPS) of HK$0.195, up from an EPS of HK$0.188 in the corresponding period a year prior.

 

Revenue for the half-year period stood at HK$866.9 million, up 11.4 per cent from HK$778.5 million in H2 FY2024. Both industrial and commercial electronics segments, as well as consumer electronics segment, recorded increases in revenue.

 

For the full year ended Mar 31, Valuetronics reported net profit of HK$170.4 million, up 6.8 per cent from HK$159.6 million in FY2024, translating to an EPS of S$0.416. Revenue for FY2025 increased 3.5 per cent to HK$1.7 billion.

 

Other income and gains for the full year slipped 10.1 per cent to HK$58 million from HK$64.5 million in the same period a year earlier, largely due to the fair value loss from financial assets and the decrease in interest income in tandem with the lowering of interest rates by the US Federal Reserve during the financial year.  

 

The board has proposed a final dividend of HK$0.11 per share and a special dividend of HK$0.08 per share, to be paid out on Aug 22.

This brings the total dividend for FY2025 to HK$0.27 per share, including the interim dividend and special dividend of HK$0.08 paid in December 2024, and implies a dividend payout ratio of 65 per cent of net profit with respect to FY2025.

 

On Feb 28, 2022, Valuetronics announced its HK$250 million share buyback programme, where HK$107.1 million has since been used to repurchase an aggregate of 34.1 million company shares. The group intends to continue with the share buyback programme in FY2026.

Between Apr 17 and 24, Valuetronics independent director Sandy Liu acquired 84,400 shares at S$0.607 per share. This followed the acquisition of 59,000 shares on Apr 15. Liu was appointed to the board of the integrated electronic manufacturing services in July 2024. 

On Apr 15, Valuetronics independent director Sandy Liu acquired 59,900 shares at S$0.60 per share. This was Liu&lsquo s first acquisition in the one-stop integrated electronic manufacturing services provider since her appointment to the board in July 2024. 

 

Back in November, Valuetronics said that its strategic diversification progress, which included allocating more resources towards newly acquired customers with higher growth potential and better margins, was showing results. The group also highlighted growth in its industrial and commercial electronics segment driven by new customers, including encouraging revenue contribution from a Canadian network access solutions provider, and other new customers.

 

It declares an interim dividend of HK$0.04 per share, on top of a special dividend of the same amount

 

INTEGRATED electronic manufacturing services (EMS) provider Valuetronics&rsquo net profit for the first half ended September grew 10.2 per cent to HK$90.5 million (S$15.6 million) from HK$82.1 million.

 

Earnings per share grew 11.6 per cent to HK$0.221, versus HK$0.198 in the same period the previous year.

 

This came as improved margins helped to offset a 3.3 per cent dip in revenue to HK$862.1 million, said the group on Wednesday (Nov 13).

 

Revenue from consumer electronics fell 17.6 per cent to HK$193.4 million, which Valuetronics attributed to softening demand in end-markets.

 

Top-line growth from the industrial and commercial electronics segment helped to offset the decline in part, rising 1.8 per cent to HK$668.7 million on the back of revenue contributions from new customers.

 

Chairman and managing director Ricky Tse noted &ldquo encouraging&rdquo revenue contributions from a new Canada-based industrial and commercial electronics customer, which Valuetronics acquired in the previous financial year.

 

&ldquo Together with other new customers acquired in the past two years, these revenue streams offset reduced demand from a consumer electronics customer that is focused on traditional consumer lifestyle products,&rdquo he said.

 

Gross profit margin for H1 FY2025 improved 1.2 percentage points to 16.8 per cent, which the group said was driven by a shift in sales mix and reduced material costs as component shortages eased.

 

Valuetronics noted that labour costs in China eased due to the depreciation of the yuan against the Hong Kong dollar.

 

Overall operating expenses and finance costs were nonetheless higher in the half year under review, due to higher administrative expenses which the group considered in line with its enlarged operations.

 

An interim dividend of HK$0.04 per share was declared on top of a special dividend of the same amount, both to be paid out on Dec 6.

 

This brings the total dividend for H1 FY2025 to HK$0.08 per share, unchanged from the prior year. 

Electronics manufacturing services provider Valuetronics BN2 Holdings will invest approximately HK$172 million ($28.39 million) through its wholly-owned subsidiary to expand AI computing infrastructure that will be leased to its 55%-owned joint venture (JV), Trio AI Limited.

 

According to a Sept 27 bourse filing, Valuetronics will acquire an additional batch of approximately 750 MetaX graphics processing unit (GPU) chips and ancillary hardware as part of the investment. This will expand Trio AI&rsquo s computing capacity from the current 250 GPU chips to above 1,000 GPU chips. 

 

Mainboard-listed Valuetronics announced in June that it had set up a JV with SinnetCloud HK. The latter is a wholly-owned Hong Kong subsidiary of Sinnet Cloud Co. Ltd., a GPU and AI solutions provider affiliated with the Shenzhen Stock Exchange-listed Beijing Sinnet Technology Co., Ltd.

 

Valuetronics says the increased GPU capacity will let Trio AI offer &ldquo premium, high-performance services&rdquo , including accelerated AI model training, real-time analytics and large-scale simulations, that can command higher pricing and profit margins.

 

According to the announcement, the larger capacity will allow the JV to enable generative AI uses and tailored services for AI-driven applications, including personalised recommendations and advanced cybersecurity solutions.

 

Ricky Tse, chairman and managing director of Valuetronics, says: &ldquo The market response to our initial investment in the 250-unit GPU computing cluster in Hong Kong has been remarkable. This deployment has garnered significant attention because MetaX GPU is developed by a leading technology company in China and we are the first one to commercially introduce it in the overseas markets. Building on this momentum, our latest investment strategically increases our capacity to over 1,000 GPU chips, establishing an industry-leading scale that further strengthens Trio AI' s pioneering status in the Hong Kong market.&rdquo

 

Tse adds that the expansion will attract high-value clients and unlock new business opportunities. &ldquo We are confident that this expansion will enable us to fully leverage the growing potential within the rapidly evolving AI landscape."  

 

Similar to the terms of its earlier investment, this batch of additional equipment will be leased to Trio AI under the existing master equipment leasing agreement, with terms that include a lease period of 60 months from the date of delivery and installation. 

 

The lease terms will cover the acquisition and associated costs, including an interest component, with the total cost to be funded through the group&rsquo s internal resources.