PLCs continue trend of venturing into EV space in 1Q

TheEdge Wed, Apr 06, 2022 08:00am - 4 months View Original


KUALA LUMPUR (April 6): Riding on the global interest in electric vehicles (EV), a number of Malaysian listed companies have tapped into this growing sector, with the trend continuing in the first quarter of this year.  

In January, Dagang NeXchange Bhd’s (DNeX) subsidiary Silterra Malaysia Sdn Bhd, in anticipation of the elevated demand for semiconductors, said it is investing RM645 million in an expansion plan to boost its annual capacity by 20% to 10 million mask layers.

DNeX said the move will position the semiconductor wafer foundry to grow further, in view of the continued strong demand for semiconductors and prevailing capacity constraints within the industry due to the high demand of electric vehicles, Internet-of-things (IoT), data centres and electronic commerce.

Meanwhile, early last month, auto parts maker EP Manufacturing Bhd (EPMB) said it had signed a memorandum of agreement (MoA) with CIS Pride Silver Rock Fund (CIS) and Sharkgulf Technologies Group Ltd to undertake the manufacturing and distribution of two-wheeled electric vehicles for Malaysia and other Southeast Asian countries.

Even companies whose core businesses are not related to automotives or semiconductors want a slice of the EV pie.

For instance, stainless steel cookware maker Ni Hsin Group Bhd said in March that it had inked an original equipment manufacturing agreement with China-based Dongguan Tailing Motor Vehicles Co Ltd to assemble, test, as well as run quality control and commission the latter’s eBixon EV Bike.

CSH Alliance Bhd announced its shift to the EV sector on the heels of its decision to scrap its plan to construct a glove manufacturing plant. 

Last month, the group — which is involved in the manufacture of ceramic and pottery products, moneylending, construction, property development and logistics — said it entered into a memorandum of understanding (MoU) with BYD Malaysia Sdn Bhd to explore a partnership to distribute fully electric commercial vehicles and provide related after-sales services in Malaysia.

Notably, it had called off its plans to build a glove manufacturing plant, saying the venture was not viable, given that it would be a late entrant into the sector, which will require significant time and capital; CSH Alliance had earlier raised RM103.61 million from a rights issue, of which RM76.1 million was earmarked for its glove venture.

Of the four companies, only DNeX is in the black, reporting a net profit of RM43.84 million for its second financial quarter ended Dec 31, 2021 (2QFY22), thanks to higher revenue contribution from SilTerra, while its quarterly revenue stood at RM353.31 million.

For its financial period ended June 2021 (FY21) which covered an 18-month period as DNeX changed its financial year end to June 30 from Dec 31, it registered a net profit of RM119.98 million.

EPMB returned to the black for its fourth quarter ended Dec 31, 2021 (4QFY21), with a net profit of RM2.74 million, from a net loss of RM7.13 million in the immediate preceding quarter.

It remained in the red for the full FY21, although its net loss narrowed to RM8.19 million from RM15.16 million a year ago.

As for Ni Hsin, it posted a net loss of RM6.39 million for its financial year ended Dec 31, 2021, compared to net profit of RM1.92 million a year ago, despite revenue rising to RM30.62 million from RM25.29 million.

CSH Alliance posted a net profit of RM40,000 for its second quarter ended Dec 31, 2021 (2QFY22), against a net loss of RM685,000 last year, on the back of revenue almost tripling to RM9.53 million from RM3.44 million in 2QFY21.

Meanwhile, for the six months ended Dec 31, 2021 (6MFY22), its net loss contracted to RM659,000 from RM888,000 a year ago, as its revenue jumped over three-fold to RM17.12 million, from RM5.88 million in the corresponding period of the previous year.

Net loss at the group widened to RM16.6 million for its financial year ended June 30, 2021, from RM5.0 million the year prior.  

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