The Daily Pulse of Bursa Malaysia

Is Datasonic ready to propel higher?

Publish date: Mon, 10 Jun 2024, 07:49 AM
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Datasonic Group Bhd has been on a bullish streak, closing at a new 3-year high of 56 sen on June 7.

The counter is likely to see further upside given the the positive momentum.

Follow-through buying may lift prices towards immediate resistance levels at 60 sen and 63 sen.

In the past year alone, Datasonic has gained 22.8% to close at 56 sen.

It was trading at a low of 42 sen in January this year.

Recently, the optimism on the integrated information and communications technology (ICT) solutions provider rose mainly on its contract extensions from the Home Ministry worth a total of RM181.66 million.

However, all the extensions are for six months only, from June 1 to Nov 30 this year.

These follow the letter of award and four contract extensions, also for 6 months, from the Ministry of Home Affairs (MOHA) worth a total of RM175 million.

This time, Datasonic said it received an extension for the supply of MyKad, MyTentera and MyPOCA raw cards and consumables to the National Registration Department (JPN) for an additional ceiling contract value of RM27.81 million.

Datasonic also received a third extension to the contract for the comprehensive maintenance services of card personalisation centres at JPN, worth RM11.57 million.

In addition, it was also given contract extensions for the supply of Malaysian passport chips, worth an additional RM59.77 million; Malaysian passport documents worth RM29.81 million, and polycarbonate biodata pages worth RM52.70 million, to the Immigration Department.

The group has been the sole provider of passport solutions to the Immigration Department since 2016.

In May, the counter touched a two-week low of 47 sen despite reporting its best-ever quarterly and annual earnings.

The much improved performance was due to higher demand for passports, identity cards, and financial card personalisation services.

Datasonic’s net profit for the fourth quarter ended March 31, 2024 (4QFY2024) jumped 70% year-on-year (y-o-y) to an all-time high of RM38.6 million.

This was on the back of quarterly revenue of RM115.74 million, lifting full-year net profit by 20.08% to a record high of RM92.26 million.

Analysts expect the group’s earnings growth to continue in the coming financial years, given the sustained healthy demand for its products and margin expansion.

Perhaps this time, the counter will see a sustained run in its share price given its track record in securing contract extensions and better financial performance.

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1 person likes this. Showing 1 of 1 comments


If the co. has potential to move higher, why then the directors were disposing their shareholdings in the co? And in significant amounts.

1 week ago

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