PETALING JAYA: Supermax Corp Bhd
is navigating a turbulent operating environment, with analysts forecasting widened losses in the near term even as policy catalysts and operational upgrades offer a glimmer of upside.
RHB Research said the inflection point thesis from its previous switch to a “trading buy” on Supermax had deviated from reality.
“Cash burn has resumed, with the net cash position narrowing to RM596mil (19 sen per share) from RM691mil in the first quarter ended Sept 30, 2025 (1Q26),” the brokerage said.
“We believe Supermax is navigating a perfect storm – it is incurring the heavy operating expenditure burden of ramping up its US operations just as the federal protection via the 19% to 20% International Emergency Economic Powers Act tariffs on imports from Asean peers was weakened by a legal ruling,” it explained.
It expected Supermax’s core losses to widen to RM67mil in the financial year ending June 30, 2026 (FY26), before swinging back into positive earnings of RM7mil by FY28.
As such, it lowered its target price for Supermax to 34 sen from 43 sen, while maintaining a “trading buy” rating.
Kenanga Research highlighted Supermax’s investment in automation to counter higher operating costs.
“Supermax is increasing investment in automation. It is retiring or upgrading older, inefficient production lines and replacing them with modern, high-efficiency, high-capacity ones,” it noted.
Despite the measures, Kenanga Research forecast a FY26 net loss of RM101mil and downgraded the stock to “underperform” from “market perform” and lowered its target price to 24 sen from 37 sen.
TA Research also noted efficiency gains from line upgrades but pointed to high US production costs.
