KUALA LUMPUR: Public Investment Bank (Public Invest) reiterated its 'outperform' call on Magni-Tech Industries Bhd and raised earnings by 8.0 per cent to 11 per cent for financial years 2024-2026 to reflect robust sales performance.
"We believe that the enduring consumer focus on health and active lifestyles will continue to underpin the global consumption of sportswear," it said in a note today.
Heading into the fourth quarter of financial year 2024 (FY2024), Public Invest anticipates a slight dip in Magni's earnings compared to the previous quarter, as historically, 3Q has typically been the stronger period owing to Magni's product portfolio.
"Despite this, we remain optimistic about the sustained demand for sportswear, fueled by the increasing awareness of sports, health, and wellness," it said.
While short-term sales may face some headwinds due to inflationary pressures, we anticipate a potential uplift in leisure sales with the upcoming summer Olympics in Paris.
Moreover, the outlook remains promising as Magni's key client gears up to introduce new products, which could drive further sales growth.
The research house said that Magni-Tech's current valuation is deemed attractive, given that it is trading below its five-year average forward earnings multiple of eight times.
At the time of writing, the Magni-Tech share price had risen 6.40 per cent to RM2.16.