This is a good stock to look at, if you are expecting to sell plenty of the new Myvi models which indeed looks promising. Selling plenty of cars mean more seats are needed and Pecca Group is closely related to supplying Perodua on its Bezza models previously.
We aren’t sure about current Myvi model taking up the seats from Pecca but the likelihood is high. Pecca’s customer base is still diversified throughout different car makers but Perodua still contributes a big chunk close to 30% of their revenue. Note that Pecca will only
A quick check from the chart, we found that the stock price continues to see weakness after the Malaysian automotive sales numbers continues to decline and expect an even slower growth ahead.
Technical analysis showed that MACD is currently turning up which makes it a good time to collect, OBV already saw a good support and the volume from current drop is much lower compared to the stock going upwards.
The downside in technical analysis could be show clearly here. We can’t determine a cut loss point due to insufficient data since the company just launched its IPO last year.
Cut loss point would have to be determined by your tolerance and understanding towards the stock. Recorded results from future earnings would be able to assist in finding more accurate valuations.
Another company to benefit from the latest Myvi would be APM Holdings where it derives a huge chunk of its revenue from Perodua. APM supplies interior equipments, suspension, electrical & heat exchange equipment to the Perodua.
Again, we do not know whether the new Myvi comes with parts from APM Holdings but based on limited suppliers in Malaysia, it is likely that the use previous suppliers.
Stock chart looks fine, but liquidity is still a major concern. We think that you would need a lot of patience buying into this counter as mostly move movements are hard to read and transacted volumes are small.
We recommend buying based on fundamentals but not our most preferred due to liquidity risk. Stick with Pecca at the moment…