PETALING JAYA: Techbond Group Bhd
is likely to see stronger export growth and steady demand from existing and new markets, with Vietnam driving an earnings recovery next year.
This will be from a low base as Techbond’s performance this year was impacted by production setbacks, said RHB Research.
The adhesives and sealants producer highlighted that global macroeconomic conditions remain fluid amid policy shifts and evolving tariff dynamics.
While US reciprocal tariffs add complexity to trade dynamics, on-going regional diversification efforts portend tailwinds for Asean-based producers, including Techbond, the research house said.
RHB Research maintained its earnings estimates on Techbond for now as it views the continued optimisation and rationalisation of the company’s product portfolio to be supportive of gross profit margin while the expanding clientele base should drive stronger growth ahead.
It maintained its “buy” call on the stock with an unchanged target priceof 42 sen, adding it offers a 4% yield for the company’s financial year ending June 30, 2027 (FY27).
The target price is based on 14.5 times FY26’s price-earnings ratio, supported by the Techbond’s vertically integrated business, expanding export footprint, margin-accretive optimisation strategy, and strong net cash balance sheet.
The key downside risks cited are weaker-than-expected demand and margins, and foreign exchange volatility.
