Oppstar Berhad (Technical Buy)

• Hitting a low of RM1.49 in May 2023, the share price moved sideways and closed at RM1.76 last Friday. With the share price likely to find support at its near-term support of RM1.70, which coincides with the recent price reversal point in July 2023, a technical rebound could be anticipated.

• This is supported by the DMI Plus hovering above the DMI Minus coupled with the 12-day moving average is still hovering above the 26-day moving average following the recent MACD golden cross.

• The stock will likely head towards our resistance thresholds of RM1.95 (R1; 10% upside potential) and RM2.09 (R2: 19%upside potential).

• Our stop-loss level is pegged at RM1.60 (representing a 9% downside risk).

• Oppstar’s primary operations revolve around semiconductors as well as producing computer chip designs for various uses (i.e. analog, mixed-signal, and digital applications).

• Fundamentally speaking, QoQ, the group achieved a profit of RM5.5m in 4QFY23 compared with a profit of RM4.5m in 3QFY23 mainly backed by its strong order book.

• Based on consensus forecasts, OPPSTAR’s net earnings are projected to come in at RM28.7m in FY March 2024 and RM40.6m in FYE March 2025, which translate to forward PERs of 39.0x and 27.6x, respectively.

Sunview Group Berhad (Technical Buy)

• Listed in October 2022, SUNVIEW’s share price has been riding on an uptrend reaching a high of RM0.98 recently, showing an increment of 238% and closed at RM0.92 last Friday. We expect the share price to surge given that more EPCC projects will be dished out under the CGPP.

• A continuation of the uptrend can be anticipated supported by the positive technical signals as suggested by the rising of Parabolic SAR and the DMI Plus placing higher than the DMI Minus.

• The stock is expected to climb towards our resistance thresholds of RM1.00 (R1: 9% upside potential) and RM1.08 (R2: 17%upside potential).

• Our stop-loss level is pegged at RM0.84 (representing a 9% downside risk).

• From the fundamental point of view, SUNVIEW’s operations primarily involve the EPCC of Solar PV systems as well as selling the solar power it generated.

• Earnings-wise, the group reported a profit of RM5.6m in 4QFY23 compared with a profit of RM2.3m in 3QFY23 mainly due to more EPCC jobs from the LSS.

• Based on consensus forecasts, SUNVIEW’s net earnings are projected to come in at RM21.9m in FY March 2024 and RM29.1m in FYE March 2025, which translate to forward PERs of 39.1x and 27.7x, respectively.

Source: Kenanga Research - 14 Aug 2023