PETALING JAYA: A weaker second half is expected for UMediC Group Bhd
stemming from uncertainties of its manufacturing segment.
Hong Leong Investment Bank (HLIB) Research said the strengthening ringgit against the US dollar and potential rise in plastic costs, as a result of recent oil price surges from the war in Iran, are likely to be key factors.
Furthermore, for UMediCs distribution segment, the group has guided a flattish second half due to lower demand for medical devices and consumables from both public and private healthcare service providers.
However, HLIB Research reckoned that sales volume of respiratory products from its manufacturing segment would be supported by global healthcare megatrends particularly the growing ageing population.
It reiterated its “hold” call with a lower target price (TP) of RM0.30 from RM0.35.
“Despite the earnings downgrade amid foreign exchange and raw material uncertainties, we believe the recent share price correction has largely priced in this headwind, leaving a more balanced risk-reward profile at this juncture.”
Meanwhile, Phillip Capital Research noted that UMediC’s results for the first six months of 2026 came in below its and consensus expectations, accounting for 40% and 44% of the full-year forecast, respectively.
It said the reason for this was on the back of lower-than-expected margins.
For the first quarter of 2026, revenue declined by 5% quarter-on-quarter, mainly from the distribution segment due to weaker public hospital orders, which will typically pause in November due to seasonal budget cycles.
