VS Industry: Clouded Outlook

V.S. Industry Berhad (VS) swung into a core net loss of RM31m in 2QFY26 from a core net profit of RM7.4m in 2QFY25, driven primarily by a pullback in orders from key customers against a backdrop of softening global consumer sentiment.

Cumulative 1HFY26 results came in well below both our and consensus expectations, representing only 4% and 2% of respective full-year estimates.

VS Industry: Clouded Outlook

The discrepancy in our forecast was largely due to the weaker-than-expected order volumes from key customers. Compounding this, the recent escalation of geopolitical tensions, particularly in the Middle East, has heightened global risk aversion and introduced further supply chain uncertainties.

“Thus, we revise our FY26-28F earnings forecasts downward by an average of 68%, reflecting softer projected revenues and higher cost assumptions.

With that, we downgrade our rating from Trading Buy to Neutral with a lower TP of RM0.27, which is based on an unchanged valuation of 17x PE pegged to CY27F EPS,” says Public Investment Bank.

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