Greatech upbeat on EV energy storage - MIDA | Malaysian Investment Development Authority
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Greatech upbeat on EV energy storage

Greatech upbeat on EV energy storage

12 Aug 2021

Greatech Technology Bhd expects demand to improve in the coming quarters, driven by continued pickup activities in the end markets of solar thin film and electric vehicle (EV) energy storage.

The factory automation solutions provider stated its growth would be supported by the strong local presence, consistent investment in technology and innovation and strategic expansion of its manufacturing capacities in Penang.

Greatech’s net profit jumped 117.7% year-on-year (YoY) to RM38.38 million for its second quarter ended June 30, 2021 (2Q21), compared to RM17.63 million in the corresponding period last year.

Revenue increased by 142.5% YoY to RM136.36 million versus RM56.22 million last year, mainly attributable to the higher revenue recognised for production line systems (PLS) in the EV energy storage industry, contributing 88.93% of the total revenue for PLS.

For six months, the group’s net profit increased by 135.4% to RM85 million while revenue soared 112.5% to RM231.5 million.

Greatech shares closed 0.7% lower to RM7.05 yesterday, giving it a market value of RM8.83 billion.

The counter closed weaker followed a weaker trend seen in other technology stocks.

The group said it continues to experience inflationary pressure in certain raw materials and freight. However, it has built up inventories and secured alternative means for certain critical parts.

Greatech noted that economic growth is picking up in the US, driven by unprecedented fiscal and monetary stimulus measures, and underlying drivers include development of carbon-efficient transportation, public and private sector funding and tightening of environmental regulations remains strong.

The company said it was not burdened by any negative effects of the Covid-19 pandemic, except from near-term upward pressures on freight prices and logistical challenges due to global transportation capacities linked to the pandemic situation.

“At this time, the group anticipates capital expenditure spending will be in the range of RM275 million to RM280 million, which is an increase from our prior announcement on Feb 18, 2021 of RM77.37 million.

“This entails significant capacity investments to meet demand, which is expected to remain strong and the targeted combined floorspace of one million sq ft (92,903 sq m) by 2022, of which further details will be announced upon finalisation,” Greatech said.

In addition, as of Aug 9, 2021, the group’s accumulated outstanding orderbook since 2Q21 stood at RM206 million, and is expected to last until the first half of 2022.

Source: The Malaysian Reserve