Key Indices
Top Stories
Company Results | Malaysia Marine And Heavy Engineering Holdings (MMHE MK/BUY/RM0.38/Target: RM0.53)
- 1H26 core earnings beat expectation, mainly due to better project close-outs for the offshore segment, coinciding with the sailaway of several platforms. Marine repair still appears weaker yoy on account of lower vessel repair/conversion jobs relative to 1H25, but 2H26 will see better traction. Sustaining its execution and building up a higher marine repair profit base are key for a re-rating. Maintain BUY with a target price of RM0.53 adjusted from RM0.50 as we roll over to 2027 horizon (0.5x P/B).
Company Results | NationGate Holdings (NATGATE MK/BUY/RM1.41/Target: RM1.88)
- NatGate’s results missed our expectations as a revenue and margin recovery lagged our earlier optimistic 2026 assumptions. That said, we expect an earnings inflection from 4Q26, driven by new optical module programmes, booming AI data centre demand and improving yields. Growth should accelerate further into 2027 as a higher volume ramp-up, better yields and operating leverage drive an S-curve earnings recovery. Upgrade to BUY with a revised RM1.88 target price (from RM0.82), following an earnings recalibration and a rollover to 24x 2027F PE.
Company Results | Velesto Energy (VEB MK/BUY/RM0.25/Target: RM0.29)
- 2Q26 core loss/weak EBITDA are temporary blips within expectation, reflecting downtrending DCR and a low 56% utilisation in 2Q26. While N3 will remain idle until mid-4Q26, VEB’s unique track record again appeals to regional oil majors seeking domestic rig security demand. As its remaining five rigs are fully contracted for 2H26, we expect 2H26 utilisation at >85% – superior even to Borr’s 2H26 contract coverage of 70%. We retain our forecasts. Maintain BUY with an unchanged target price of RM0.29.
What’s Inside
Company Results | Oxford Innotech (OXB MK/BUY/RM0.49/Target: RM0.66)
- OXB’s 1H26 results were within expectations. 2Q26 core net profit surged 106% yoy to RM4.2m, supported by stronger contributions from the DC, semiconductor and E&E segments. Order backlog increased 30% qoq to RM38.9m, providing improved earnings visibility. We expect stronger 2H26 performance, underpinned by capacity expansion and rising demand from semiconductor and DC customers. Maintain BUY. Target price: RM0.66.
Market Spotlight
- The FBMKLCI took a breather last Friday, sliding 0.23pt to close at 1,736.48 following mild profit-taking in blue chips, in-line with weakness across the region.
- US stocks were higher after the close on Friday, as gains in the basic materials, consumer goods and healthcare sectors led shares higher.
Tehnical Analysis
FBMKLCI, FCPO & FKLI Index Outlook
Traders’ Corner
Eco World Development Group | ECW MK
- Trading Buy Range: RM2.11-2.12
Focus Point Holdings | FOCUSP MK
- Trading Buy Range: RM0.535-0.54
MCE Holdings | MCE MK
- Trading Buy Range: RM1.56-1.57
Top Stories
Company Results | Malaysia Marine And Heavy Engineering Holdings (MMHE MK/BUY/RM0.38/Target: RM0.53)
- 1H26 core earnings beat expectation, mainly due to better project close-outs for the offshore segment, coinciding with the sailaway of several platforms. Marine repair still appears weaker yoy on account of lower vessel repair/conversion jobs relative to 1H25, but 2H26 will see better traction. Sustaining its execution and building up a higher marine repair profit base are key for a re-rating. Maintain BUY with a target price of RM0.53 adjusted from RM0.50 as we roll over to 2027 horizon (0.5x P/B).
Company Results | NationGate Holdings (NATGATE MK/BUY/RM1.41/Target: RM1.88)
- NatGate’s results missed our expectations as a revenue and margin recovery lagged our earlier optimistic 2026 assumptions. That said, we expect an earnings inflection from 4Q26, driven by new optical module programmes, booming AI data centre demand and improving yields. Growth should accelerate further into 2027 as a higher volume ramp-up, better yields and operating leverage drive an S-curve earnings recovery. Upgrade to BUY with a revised RM1.88 target price (from RM0.82), following an earnings recalibration and a rollover to 24x 2027F PE.
Company Results | Velesto Energy (VEB MK/BUY/RM0.25/Target: RM0.29)
- 2Q26 core loss/weak EBITDA are temporary blips within expectation, reflecting downtrending DCR and a low 56% utilisation in 2Q26. While N3 will remain idle until mid-4Q26, VEB’s unique track record again appeals to regional oil majors seeking domestic rig security demand. As its remaining five rigs are fully contracted for 2H26, we expect 2H26 utilisation at >85% – superior even to Borr’s 2H26 contract coverage of 70%. We retain our forecasts. Maintain BUY with an unchanged target price of RM0.29.
What’s Inside
Company Results | Oxford Innotech (OXB MK/BUY/RM0.49/Target: RM0.66)
- OXB’s 1H26 results were within expectations. 2Q26 core net profit surged 106% yoy to RM4.2m, supported by stronger contributions from the DC, semiconductor and E&E segments. Order backlog increased 30% qoq to RM38.9m, providing improved earnings visibility. We expect stronger 2H26 performance, underpinned by capacity expansion and rising demand from semiconductor and DC customers. Maintain BUY. Target price: RM0.66.
Market Spotlight
- The FBMKLCI took a breather last Friday, sliding 0.23pt to close at 1,736.48 following mild profit-taking in blue chips, in-line with weakness across the region.
- US stocks were higher after the close on Friday, as gains in the basic materials, consumer goods and healthcare sectors led shares higher.
Tehnical Analysis
FBMKLCI, FCPO & FKLI Index Outlook
Traders’ Corner
Eco World Development Group | ECW MK
- Trading Buy Range: RM2.11-2.12
Focus Point Holdings | FOCUSP MK
- Trading Buy Range: RM0.535-0.54
MCE Holdings | MCE MK
- Trading Buy Range: RM1.56-1.57
Key Indices
IMPORTANT NOTICE - DISCLOSURES AND DISCLAIMERS
This report is provided subject to, and must be read together with, the full Disclosures / Disclaimers available at this link, which are incorporated by reference into this report. In particular, this report is intended for general circulation and informational purposes only and does not constitute personal investment advice or a recommendation to buy or sell any investment product or security. You should independently evaluate the information and, where necessary, seek advice from a qualified financial adviser regarding the suitability of any investment. Analyst certifications required under applicable regulations, including SEC Regulation AC (where relevant), are included in this report. By accessing, receiving or using this report, you acknowledge that you have read, understood and agreed to be bound by the Disclosures / Disclaimers, as may be amended, supplemented or updated from time to time.
