The stock price of garment manufacturer Magni-Tech Industries Bhd jumped as much as 14 sen, or 7%, in the early morning trading today after returning impressive numbers for the November 2023-January 2024 period.

Magni-Tech was trading at RM2.17 at around 10am today after closing at RM2.03 yesterday.

In an exchange filing yesterday on its financial results for the third quarter ended Jan 31, 2024 (3Q24), the company said its net profit almost doubled to RM39.4 million, up from RM20.5 million in the same period last year, on the back of RM392.2 million in revenue, up 39% from 3Q23.

It said the higher profit was mainly due to higher revenue, improved cost of sales ratio and higher forex gain by RM4.6 million.

For the nine-month period, it posted a net profit of RM93.9 million, up 35% from the same period a year earlier, on the back of RM1.004 billion.

In a report, PublicInvest Research said Magni-Tech's cumulative nine-month core net profit of RM89.2 million was above expectations, accounting for 84% of its full-year estimates.

"The discrepancy in our forecast was mainly due to the stronger-than-expected sales from the garment segment," it said in the report released today.

It has an 'Outperform' call on the counter, with a 52-week target price of RM2.50. It said the company's current valuation was attractive, given that it was trading below its average 5-year PER of 8-times.

"Going into 4QFY24, we expect Magni to post weaker earnings QoQ, as 3Q has generally been the stronger quarter given Magni's product range," it said.

Magni-Tech's businesses are principally divided into two business segments, namely the manufacturing and sale of garments and flexible plastic packaging goods and corrugated cartons. The garment segment accounted for close to 96% of its revenue and profit from operations.

In the filing, it said the group remained 'cautiously optimistic' over the business outlook for the remaining quarter of FY24.