PETALING JAYA: Pantech Group Holdings Bhd
is expected to see a stronger first quarter of financial year 2026 (1Q26) driven by better manufacturing contributions.
Phillip Capital Research said earnings momentum will be further fuelled by the addition of new customers, successful market expansion and higher automation levels.
In 4Q25, the steel pipe manufacturer had posted a net profit of RM14.25mil or a basic earnings per share of 1.71 sen, as well as a revenue of RM193mil.
The group closed the year with a cumulative net profit of RM82.5mil or a basic earnings per share of 9.91 sen.
Its revenue for FY25 totalled to RM947.48mil.
Looking ahead, Phillip Capital Research estimates Pantech to come in stronger in 1Q26 with earnings expected to grow by 12% year-on-year.
The research house attributed the stronger earnings forecast to better manufacturing contribution which is expected to help offset ongoing weakness in the trading division amid subdued domestic oil and gas activity.
As of now, the group’s manufacturing plants are operating at a high utilisation level of about 90%.
That being said, Pantech is now investing in machinery upgrades and intensifying automation efforts as a move to boost operational efficiency and drive further margin improvements.
“With the manufacturing plants operating at a high 90% utilisation level, we expect Pantech Global to register RM14mil to RM15mil core net profit.
“We expect 1Q26 to be broadly in line with our FY26 earnings forecast, representing 19% to 21% of our FY26 full-year estimates,” said the research house, adding that historically 1Q25 has contributed 19%, 22% and 36% of full-year earnings in FY23 to FY25, respectively.
Additionally, Phillip Capital Research noted that the group’s export demand in the United States remained resilient.
This is despite the US government’s efforts to double tariffs on pipe products to 50%, which is expected to take effect today.
Pantech continued to see strong orders from key existing markets, with incremental demand from data centre-related projects in the United States and Mexico.
Meanwhile in Europe, the group is enjoying a relative competitive advantage, as the anti-dumping duties imposed on its products are lower than those levied on Chinese producers.
Having secured its first Brazilian customer in the previous quarter, the group is also noted to be in an active discussion with another potential buyer in Brazil for stainless steel pipes and fittings.
Phillip Capital Research maintained a “buy” call on Pantech with an unchanged target price of 89 sen.
“We remain positive on Pantech’s growth potential, supported by listing proceeds of Pantech Global, which are earmarked for future capacity expansion to capture robust global export demand,” it added.
