{
  "id": 2924492,
  "title": "NationGate surged 9pct as UOB KayHian upgraded to \"Buy\"",
  "url": "https://urgent.news/2026/08/24/nationgate-surged-9pct-as-uob-kayhian-upgraded-to-buy",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-08-24T02:17:35.000Z",
  "source": {
    "name": "New Straits Times",
    "slug": "new-straits-times",
    "url": "https://www.nst.com.my/business/corporate/2026/08/1517524/nationgate-surged-9pct-uob-kayhian-upgraded-buy"
  },
  "original_language": "en",
  "account": "NationGate Holdings Bhd's shares surged nearly nine percent in early trading on Bursa Malaysia, making it one of the most actively traded stocks on the market. The stock climbed 9.2 percent to RM1.54 before settling at RM1.53, with over 25 million shares exchanged. The counter opened slightly below its previous close, at RM1.38, compared to the Friday close of RM1.41. On a year-to-date basis, the stock has gained 70.79 percent.\n\nUOB KayHian upgraded its rating on NationGate to a \"Buy\" with a higher price target of RM1.88, based on a 24 times price-to-earnings ratio for the year 2027. Despite missing expectations in its first half earnings, UOB KayHian believes the company will see improved margins as its optical networking business expands beyond its initial stage and increases volume. The firm sees this as a potentially transformative growth opportunity, with significant potential upon successful yield optimization and large-scale deployment starting in 2027.\n\nIn its earnings report, NationGate reported a profit of RM10.9 million in the second quarter, totaling RM11.2 million for the first half. This represents 38 percent of the firm's total year forecast and 51 percent of the consensus estimate. UOB KayHian noted that artificial intelligence infrastructure is expanding beyond graphics processing units (GPUs) into high-speed networking, as inter-GPU communication becomes a limiting factor in large-scale AI clusters. This is accelerating the shift from 800G to 1.6T optical interconnects, the research firm explained.\n\nThe growing demand for higher-speed connectivity is expected to support the expansion of NationGate's networking and telecommunications segment, particularly as hyperscalers accelerate AI data center deployments and migrate towards more advanced connectivity. Additionally, the firm expects a positive impact from a potential US restriction on Chinese-made optical transceivers, benefiting non-China-based suppliers. However, UOB KayHian lowered its earnings forecast for NationGate to RM39.2 million for 2026 from the previous RM78.2 million estimate. This reduction is primarily due to a longer-than-anticipated gestation period for the company's new optical module programs.\n\nNevertheless, the firm expects an \"S-curve\" earnings inflection, with profits projected to rise from RM98.1 million in 2026 to RM178.8 million in 2027. This projected growth is driven by enhanced production yields, increased operating leverage, and a higher-volume ramp-up as NationGate advances into higher-value optical transceiver module assembly, supported by robust customer program ramps.",
  "summary": "KUALA LUMPUR: NationGate Holdings Bhd’s shares rose as much as nine per cent in early trade, making it among the actively traded stocks on Bursa Malaysia.",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}