PETALING JAYA: Precision engineering group UWC Bhd
is favoured for its meaningful exposure to the front-end semiconductor value chain via wafer fab equipment (WFE).
The group is also recognised for its strong engineering capability in executing critical subsystem assembly alongside its traditional component fabrication, as well as its long-standing presence in the back-end semiconductor value chain.
Kenanga Research said in a note UWC’s financial year ended July 31, 2026 (FY26) net profit came in at RM93.8mil, accounting for 100% and 97% of its and consensus’ full-year estimates, respectively.
The in-line outcome was underpinned by strong momentum in the semiconductor segment, which more than offset continued weakness in the life science and medical division, it added.
Stripping out foreign-exchange impact, core net profit would have come in above expectations at RM103mil, representing 109% and 106% of its and consensus’ full-year estimates, respectively, the research house noted.
“We expect earnings momentum to strengthen progressively over the coming quarters, driven primarily by the semiconductor segment.
“Looking ahead, we expect semiconductor contributions to remain robust, supported by order ramps from both front-end and back-end customers.”
Following the results, Kenanga Research raised the target price for UWC to RM7.83 a share from RM7, after rolling forward its valuation base year to 2027.
At last look, the stock stood at RM7.03.
Kenanga Research said it continues to see the semiconductor segment as the anchor for the group’s next leg of growth, supported by strengthening contributions from both its front-end and back-end exposures.
On the front-end, it believes the WFE cycle still has further room to run in 2027, supported by ongoing capacity expansion plans from key industry players.
“At the back-end, we expect growth from the new manipulator program to normalise in due course,” it said.
Hong Leong Investment Bank Research sees good visibility on its FY27 earnings forecast of 60% year-on-year growth for UWC, with scope for further upside from a faster ramp by Customer I and/or higher volume allocation from Customer L.
“Beyond that, we believe there is more incremental upside on FY28 delivery, driven mainly by other front-end customers,” the research house noted.
