Pan Merchant
PMI specializes in manufacturing filter presses for liquid-solid separation. The primary application for the presses is in edible oils, and mainly for crude palm oil processing.
PMI specializes in manufacturing filter presses for liquid-solid separation. The primary application for the presses is in edible oils, and mainly for crude palm oil processing. The secondary application is within waste management, including water treatment as well as mining. This gives PMI potential as an ESG play. PMI is primarily an exporter, with over 85% sales coming from abroad, including countries like Indonesia, Europe, and US.
About the stock
PMI was listed on the ACE market in June 2025, with the retail portion undersubscribed at only 37% taken up. It remains controlled by the founders'
family - which also control the board and management. PMI is a Syariah-compliant stock.
Investment thesis
PMI is well positioned to capitalize on the development of domestic water
treatment projects in Selangor and other states - supplying press filters for waste management. Each phase (there are two) will require ~RM50 worth of filter press (based on projects of similar scale), or ~20% upside to baseline revenue run-rate. Placement of underwritten shares from IPO will also provide a liquidity event.
Key risks
- PMI has some customer concentration risk, with over almost 70% of revenues coming from its top 4 customers. PMI is mitigating this risk via diversification into other customers and segments.
- PMI could face competition from Chinese firms in the future. It is reliant on long-standing relationships with customers in the edible oils segment, and proven track-record to fend-off competition.
- Founders/shareholders control most key management positions via family members. This could pose governance, succession planning, and talent development risks.
Stock information
Pan Merchant
PMIBHD - 0361.KL
BUY
Target price: RM0.30
Last price: RM0.215
Market cap (RMm): RM1,97m
Shares out: 916m
52-week range: RM0.185 / RM0.26
3M ADV: RM0.02m
T12M returns: -20%
Share price performance
Investment fundamentals
| RMm | FY24A | FY25E | FY26E | FY27E |
|---|---|---|---|---|
| Revenue | 142 | 140 | 183 | 176 |
| Revenue YoY | 2% | -1% | 31% | -4% |
| Adj PATAMI | 10.2 | 8.1 | 15.3 | 12 |
| Adj PATAMI margin | 7% | 6% | 8% | 7% |
| DPS (sen) | - | 0.2 | 0.7 | 0.5 |
| ROA | 7% | 6% | 9% | 7% |
| ROE | 14% | 10% | 16% | 12% |
| PER | 18 | 22.7 | 12 | 15.3 |
| P/BV | 2.5 | 2.3 | 1.9 | 1.8 |
| Yield | 0% | 1% | 3% | 3% |
| Net debt/equity | -13% | 0% | -13% | -9% |
Source: Company data, NPS Research, October 2025
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