HLIB Research maintains Buy on Inari, ups target to RM3.67

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KUALA LUMPUR (May 18): Hong Leong IB Research has maintained its “Buy” rating on Inari Amertron Bhd at RM3.39 with a higher target price of RM3.67 (from RM3.44) and said it continued to like Inari’s expansionary business plans to outshine the growing semiconductor industry.

In a note today, the research house said Inari’s 4QFY15 order was likely to be at the same level with the hope that Avago may resolve its capacity constraint earliest by June 2015.

“A 6-story premise to be erected next to P13 equivalent to 222,000 sq ft to cater for 3 expansion projects. Total investment is estimated at RM53 million.

 “Amertron: although it has yet to achieve its net margin target of 10%, transformation is on track. The Clark Field factory will also be expanded for fibre optics business.

“Reiterate Buy after raising target price by 6.7% from RM3.44 to RM3.67 reflecting the upward earnings revisions,” it said.