HANA Price rises over 6% on new investment

Hana Microelectronics announced its plan to invest US$65m in a new facility for mass production of both Silicon & Silicon Carbide Power Management devices in the next 12 months. As a result, share prices have risen by over 6 per cent in Monday’s trading. 

According to a filing with the exchange, HANA says its key respondents include Chinese telecommunication and server companies, a leading Japanese global consumer electronics corporation, a major Korean auto infotainment brand, a leading Korean EV charger company, and significantly, one of Korea’s largest consumer electronics Chaebols with which a contractual agreement has been signed to supply devices in volume upon the completion of mass production facilities. 

HANA also announced an interim dividend of Bt1/share. It goes XD on October 29 and the payment date is November 15.

While investors have upped the share price by 7%, how much does this facility will contribute to the earnings, is not known yet. Perhaps the company will update analysts on the prospects of new business on 12 November when it reports its 3Q earnings.

Analysts expect 3Q profit of Bt671m, up 112% YoY and down 10% QoQ. On analysts’ forecasts, 4Q net profit may be less than 3Q21. Given that Baht has weakened against the US dollar, HANA’s may surprise analysts as it benefits from currency depreciation.

Latest developments related to the company are as follows: –

  1. Analysts upgraded 2021 profit forecast by 24% in last 4 weeks
  2. Analysts estimate of 3Q earnings to fall QoQ 
  3. At least one analyst upgraded the stock rating to BUY
  4. At least one analyst upgraded target price to Bt85
  5. Trading volume has risen
  6. Increase in holdings in last 3 months by SCB Asst Mgmt., Thanachart Fund Mgmt., Krungsri Asset Management, BBL Asset Management, Manulife Financial Corp, and UOB Asset Management.
  7. Decrease in holding in last 3 months by State Street Global Advisors, Aberdeen Asst Mgmt, Tisco Asset Management.
  8. Based on the foreign ownership limit change, in September, foreign investors net bought Bt1.0bn on the foreign board, and Bt890m in NVDRs.

On Bloomberg, HANA is rated buy by 10 analysts, and HOLD by 4 analysts. Average target price is Bt81. Kasikorn Securities and DBS Bank have target price of Bt95 – highest.

Insiders have been selling shares until September. This month one of the executives has started to buy shares.

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