DELTA accelerates price hike talks as high raw material costs squeeze margins

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โดย Thunhoon·Read original
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Delta Electronics Thailand, or DELTA, is in talks with customers to raise selling prices to offset higher raw material costs. The negotiation process is expected to continue through the fourth quarter of 2026, with clear results seen thereafter. CEO Victor Cheng said demand in the AI and data center segments remains strong, with high levels of advance orders supporting full-year revenue growth in the double digits as targeted. However, gross margins are being pressured by surging raw material prices, especially IC fabrication, DRAM, PCB, MOSFET, MLCC, metal parts, and chemicals, as well as the impact of Middle East conflicts and sanctions on Chinese suppliers. This has forced the company to accelerate sourcing of alternative production bases and set aside inventory reserves of about 800 million baht in the second quarter of 2026. Analysts at Bualuang Securities noted that second-quarter 2026 profit is likely the trough, and they expect net profit in the third quarter of 2026 to recover to around 9 billion baht, with full-year profit estimated at 37 billion baht. They recommend holding the stock and accumulating at a support level of 275 baht.

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