KUALA LUMPUR (April 22): AmInvestment Bank Research has upgraded Globetronics Technology Bhd (GTB) to Buy at RM2.49 with an unchanged fair value of RM2.84, pegged to an FY22F PE of 24x after the recent decline in the share price.

In a note today, the research house said via its channel checks, the key sensor customer’s qualification programmes for the next generation of light and gesture sensors have not been halted and mass production is still set for June 2021 and July 2021 respectively as planned.

“Following the decline in share price, we believe GTB is undervalued and that investors should take advantage of this correction to accumulate the stock,” it said.

The research house kept its FY21F capex assumptions for GTB unchanged and note that the pilot lines would be subject to customers’ qualification.

AmInvestment said GTB’s positive prospects arise from: (i) its strength in smart sensors with new generation sensor demand expected to drive growth ahead; (ii) ramp-up in laser automotive headlamps to boost LED/SSD segment; and (iii) potential opportunities to be secured from the US-China trade war that could lead to customer diversification and revenue enhancement.