KUALA LUMPUR: Aemulus Holdings Bhd's diversification into CMOS image sensor (CIS) and automotive could help the company to cushion the impact of a slowdown in mobile and tablet segments. 

CGS-CIMB Research noted that Aemulus's revenue had fallen 11.3 per cent quarter-on-quarter (QoQ) to RM17 million in this third quarter (Q3) due to weaker demand in mobile and tablet markets and order deferment amounting to over RM2.7 million. 

"The group saw order deferments from its customers mainly due to delays in wafer allocation by the foundries. 

"However, we gather from management that customers are looking to receive the testers within the next few quarters," said its analyst Mohd Shanaz Noor Azam in a note. 

CGS-CIMB revised down its financial year 2022 (FY22)-FY24 earnings-per-share forecast for Aemulus by five to 15 per cent to account for weaker-than-expected sales volume Q3 and lower sales volume griwrh forecasts to reflect the weakness in mobile and tablet markets.

"Nevertheless, Aemulus's diversification strategy into CIS and automotive is gaining good traction, with the group exploring longer-term commitments from its customers. 

"This could provide better order visibility and help to cushion the impact of a slowdown in mobile and tablet segments," said Mohd Shanaz. 

The firm also projected a better sales mix between China and rest of the world markets in Q4 as the wafer shortage situation gradually improved, especially with the easing of lockdowns in China. 

There is also a potential upside to margin delivery in Q4 in view of better economies of scale and upward revision in testers' average selling prices. 

CGS-CIMB reiterated its "Add" call for the company with a lower target price of 76 sen.