PETALING JAYA: Mi Technovation Bhd is expected to see stronger contributions from its overseas ventures this year, given the opening of a new plant in China and higher take-up of certain series of its products.

       The technology company has set a target of 20% sales contribution from new models such as Ai, Vi and Si series for its semiconductor equipment business unit in 2022.

       Separately, the group’s wholly-owned unit, Mi Equipment China, has secured maiden orders from its 22.6% associate, Talentek Microelectronics, an outsource semiconductor assembly and test house servicing Chinese design houses that produce mainly radio frequency chips.

       According to CGS-CIMB Research, Talentek might require over 150 units of test handlers over the next two years.

       It has reiterated its “add” call on Mi Technovation, with a lower target price of RM3.50, compared with RM5 previously.

       “We retain our ‘add’ rating on the stock with a lower target price of RM3.50, based on a lower 26.2 times estimated P/E for 2023 (versus 36 times previously).

       “The stock also offers decent yields of 2.9% to 3.2% for 2022 and 2023,” it added.

       Mi Technovation’s revenue rose 64% year-on-year (y-o-y) in 2021 to RM375mil, which was a new record for the group, following the consolidation of Accurus under semiconductor material business unit from the second quarter of 2021.

       Accurus contributed RM125mil, or approximately 33%, of the group’s revenue in 2021. Overall, Mi Technovation’s core net profit in 2021 rose 23% y-o-y to RM71mil.

       CGS-CIMB Research noted Mi Technovation’s core net profit for 2021 was in line at 101% with its forecast, but the number beat the consensus full-year number by 8%.