Q1-FY2026 of Scientex Berhad

 

Scientex Berhad (SCIENTX) involves in 2 core businesses:

(a)   plastic film and

(b)   property development (affordable housing).

 

At the time of writing on 24 Dec 2025, the share price of SCIENTX dropped by 20% YTD. This has caught my attention, as SCIENTX is a good company after all, from my point of view.

 

Figure 1: Share price of Scientex Berhad up to 24 Dec 2025

 

Upon extracting the operating profits of the two core business segments of SCIENTX, I found the following:

(1) Operating profit of the plastic film manufacturing segment (see Figure 2) is declining since Q2-FY2024. This could be due to the profit margin compression as shown in Figure 3. However, it seems that the profit margin started to pick up again since Q3-FY2025, which is an encouraging sign.

Figure 2: Quarter operating profit of the manufacturing segment

 

Figure 3: Quarter operating profit margin (%) of the manufacturing segment

(2) On the other hand, the property segment of SCIENTX is performing exceptionally well. This could be attributed to the aggressive land bank acquisition performed earlier and launching of affordable homes which has drawn tremendous interest from the public. It is interesting to note that Q4 of each financial year is normally the best quarter in terms of profit for this segment.

Figure 4: Quarter operating profit of the property development segment

Upon comparing the performance of these 2 business segments, I found that property development draws a very good profit margin of ~30%, vs. ~5-10% for plastic film manufacturing. No wonder SCIENTX focuses so much on land bank acquisition to grow its property development segment.

SCIENTX has just released its quarter Q1-FY2026 report, showing growth in both business segments. Now, most countries are cutting interest rates to spur economic growth. Hopefully, this could increase the order from the manufacturing segment of SCIENTX again.

 

Valuation

Is it worth for investing in Scientex Berhad now? Let us work on the answer.

 

The core profit is calculated after adding/deducting the unrealized forex loss/gain into the reported net profit attributed to shareholders. To get the fair PE value for SCIENTX, I used the PE values on the recent years 2019-2021, 2023-2024, as these years show year-on-year profit growth. For further explanation on this method, you may refer to my earlier post in YSPSAH.

 

The average and median values of the PE values from those chosen years are then determined. Here, the median value is chosen as it is smaller than the average value. Therefore, the estimated fair PE of SCIENTX is ~ 12.45.

 

Assuming the core EPS of SCIENTX in the upcoming FY2026 is same as that in FY2025 (i.e. no growth, core EPS = RM0.34), the current PE based on the current closing price of RM3.50 is PE = 3.50/0.34 = 10.29. The margin of safety (MOS) is (12.45-10.29)/10.29*100% = 21%. Personally, it is quite attractive.

 

Hopefully, the EPS of SCIENTX could improve in FY2026 (> RM0.34 EPS). If that happens, I believe the market would re-rate the PER of SCIENTX again.

 

Figure 5: Core profit and PER of SCIENTX