PETALING JAYA: Cnergenz Bhd is expanding its production capacity to support growing demand for its original design manufacturing (ODM) artificial intelligence (AI) testers, while planning a new manufacturing facility targeted to begin operations by the financial year ending Dec 31, 2028 (FY28).
According to RHB Research, ODM accounted for about 10% of Cnergenz’s RM240mil order book, with production increasing to four units per week from two units previously.
This is supported by double-shift operations.
Cnergenz is utilising additional floor space to accommodate near-term production before its new manufacturing facility comes onstream.
Cnergenz expects about 57 units to be delivered in FY26, with volumes potentially exceeding 100 units in FY27 as capacity expands.
According to RHB Research, Cnergenz’s AI tester business could expand further if its major equipment-maker client secures more customers.
Meanwhile, Cnergenz is planning a new facility at Science Park, Batu Kawan, to support assembly, automation and ODM AI tester manufacturing.
This is partly funded by about RM32mil in initial public offering (IPO) proceeds.
At the time of its IPO, Cnergenz said the expected gross proceeds of RM58mil would primarily fund the expansion of its operational facilities, research and development expenditure, and working capital requirements.
Separately, the existing Xlent facility is allocated to support new product introduction and other ad-hoc projects.
The capacity expansion comes as Cnergenz expects FY26 revenue to exceed the RM259mil record set in FY19, said RHB Research in a statement.
This is expected to be driven by sustained demand for surface mount technology equipment, expansion by major electronics manufacturing services customers, growth in its ODM AI tester business and a recovery in integrated solutions.
Cnergenz’s order book grew to about RM240mil at the end of August from RM190mil at the end of May, with Cnergenz expecting more than 80% to be recognised as revenue within FY26.
Furthermore, Cnergenz’s acquisition of Xlent expanded its capabilities into manufacturing with proprietary intellectual property, adding a revenue stream with higher margins.
RHB Research raised its earnings forecasts for FY26, FY27, and FY28 by 56%, 51%, and 52%, respectively, reflecting stronger revenue and margin assumptions.
RHB Research maintained a “buy” call, raising its target price to RM1.40 from 92 sen based on 23 times forecast FY27 earnings, and incorporating a 2% environmental, social and governance discount.
Key risks include the timing of order recognition, project execution and foreign- exchange exposure, according to RHB Research.
