Inari’s RF orders remain strong with visibility up to six months
KUCHING: Analysts have reaffirmed their positive stance on Inari Amertron Bhd (Inari), as they note that radio frequency (RF) orders remain strong with visibility up to six months.
In its recent conference call with Inari, the research arm of Kenanga Investment Bank Bhd (Kenanga Research) learnt that the group has added 10 system-in-package (SiP) assembly lines in its P34 plant and is expected to install another four SiP lines by end2020, bringing total SiP lines to 22.
“This is a 2.75-fold increase from the eight SiP lines in financial year 2020 (FY20) which is based in P13 plant,” Kenanga Research said.
“The current utilisation rate of 80 per cent is expected to be ramped up further to 95 per cent.”
The research arm attributed the strong RF loading volume to the latest 5G US smartphones that were launched last week.
According to Kenanga Research, overdue replacement cycle will drive demand for the latest US 5G smartphones, making it a go-to-choice for a future-proof upgrade among consumers.
“Note that the top three active US smartphones in circulation still consist of four to five years old models which are due for replacement.
“The fact that the latest models support 5G and were launched at the same price point as its predecessor will likely entice consumers to upgrade.
“Inari’s order visibility for RF remains very strong for the next six months.”
Kenanga Research gathered that to expand the group’s presence in the growing data centre space, Inari has secured a Hong Kong-based customer who specialises in designing and manufacturing its own proprietary optical transceiver.
“Inari is currently doing the back-end test and expects to qualify for full-line assembly in January 2021.
“In addition, the group has been working with a Swissbased company on sub-module assembly for the impedance matching network equipment.
“We gather that the end user for this product is Lam Research in Penang.”
The research arm noted that in an effort to increase revenue streams, Inari has formed a joint venture (JV) with MIT to collaborate on manufacturing outsourced semiconductor assembly and test (OSAT) equipment.