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This line is one of the first in Malaysia to have an automatic seat production process where seat frame welding lines and seat track assembly are carried out by robots.
With this new line, error and manpower utilisation are significantly reduced. This plant is now capable of consistently achieving quicker and higher volume of production without any compromise on quality and finishing.
o *APM Automotive (APM MK, CP: MYR2.06, Not Rated)*: Reported a net profit of MYR9.7m (+34% YoY) in 1Q23. Excluding one-offs, its 1Q23 core PATMI soared 61% YoY to MYR10.1m. Note that 1Q22 PATMI was mainly boosted by a MYR1.4m net foreign exchange gain. No dividend was declared for the quarter. Stock trades at 10x annualized 1Q23 core EPS. Balance sheet wise, APM is sitting on a net cash of MYR235m as at 31 Mar 2023, which is equivalent to c.58% of its market capitalization.
In response to the growing popularity of EVs, APM has embarked on several projects such as:
* Developed prototype electric buses, which are currently under evaluation;
* Established an
"e-division" under our research and
engineering arm, APM Engineering and Research, focusing on electrification projects;
* Set up an EV battery pack assembly line at its premises in Port Klang; and
* Investment in EV Connection Sdn. Bhd., a pioneer one-stop EV charging solution provider.
With the end of the sales tax exemption, the local automotive industry is expected to soften in 2023, and this was highlighted by Malaysian Automotive Association with a forecast of 650,000 units.
The Group is expected to face the challenges in escalating material, energy and labour costs, as well as the anticipated deceleration of the global economy.
* Indonesia - New JV co started to generated profit instead of loss in comparison to previous year. All other operations commenced ramp up production to support higher demands from OEMs as well as REM.
* Vietnam - secured new seats business and started supplying in Sept 2022.
Higher material price, logistic cost and staff expenses (especially due to increase of minimum wages with effect from 1 May 2022) did however compress the profitability of the Group both domestic and overseas operations.
The Malaysian Automotive Association (MAA) has revealed vehicle sales data for the month of July 2023, which saw a total of 63,676 units delivered to customers. This represents an increase of around 1.7% from the 62,593 units sold in June 2023.
The July 2023 sales total is also 27.5% higher when compared to the same month in 2022 that saw 49,934 deliveries. According to the association, the encouraging results are a result of improved supply chains as well as fulfilment of bookings for new model launches recently.
Meanwhile, the total industry volume (TIV) as of the end of July 2023 is 429,807 units, which is 12.6% higher than the same period in 2022. At a press briefing last month, the association revised its full year 2023 TIV forecast from 650,000 units to 725,000 units.
For the month of August 2023, expected to be slightly higher than July 2023 due to new model launches and promotional campaigns by car companies in conjunction with the Merdeka Day celebrations.
On the production side, July 2023 saw 66,862 vehicles produced, which is a 28% year-on-year increase from July 2022. The YTD production figure currently stands at 429,397 units, 16% higher than the corresponding period last year.
