The Daily Pulse of Bursa Malaysia

YBS hits big time with all time high. Can it continue to trend higher?

Publish date: Mon, 08 Apr 2024, 08:23 AM
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YBS International Bhd looks like an attractive option for investors after the counter touched at its all-time high of 84 sen. In the past year alone, YBS has gone up some 32.3%. The market is pretty bullish on YBS, comparing it to Inari, Vitrox and Genetec, whereby their share prices have jumped exponentially.

The home-grown YBS recently announced its tie up with California-based lithium-ion battery manufacturer Enovix Corp. YBS houses a high-volume manufacturing line for Enovix to produce silicon-based batteries at the former's Penang factory.

It is expected to start small-scale production in the second quarter of this year. As it is, YBS has the experience of assembling batteries and chargers for Motorola mobile devices, and this experience can be put to good use now.

The company will need to have some RM470 million for capital expenditure, plus RM710 million for working capital. Cumulatively, this venture is certainly a huge sum, with more than RM1 billion but the company said it has secured funding sources. In comparison, YBS spent RM24.7 million for the financial year ended March 31, 2023.

Luckily, Enovix is putting in a huge sum for this venture. Enovix invested US$30 million to turn YBS’ Penang Science Park plant into a high-volume manufacturing facility. It also provided a credit guarantee for YBS to raise US$70 million to fund the setting up and installation of machinery.

Apparently, Enovix has committed to invest US$1.5 billion in Malaysia over the next 15 years. This is pretty ambitious given that Enovix is just a start-up but is said to have the potential to be as big as technology giant Nvidia Corp.

It is good to be ambitious, for YBS to grow its size to the likes of Inari and Vitrox while Enovix to emulate Nvidia’s success story. For investors who believe these companies can one day achieve its aspirations, now will be a good time to start planting their funds in them.

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