OVERVIEW:
The counter is a provider of digital economy solutions and services for major organisations in Banking, Insurance, Payment, Retail & Logistics industries. Its client base consists of top 5 largest ASEAN financial institution as well as top 20 largest banks in South-East Asia, including three local banks.
HIGHLIGHTS:
[1] Latest quarter saw revenue up 10% year on year. Net profit down 20%. Last 9 months saw net profit down 5% year on year.
[2] Its revenue contribution among business activities showed improvement in overall.
[3] The group is in net current asset position worth RM246m. Total debt/equity <25%.
INVESTMENT THEMES:
[1] Current valuation: PE ~15 || PB ~ 7 || Dividend yield ~ 5%
[2] Last quarter earning was largely dragged down by one off cost incurred due to new business consolidation. A better Q4 would be expected as new business contribution grows. In early this month, its subsidiary just announced five new accounts being won from insurance companies in growth market, such as Vietnam, Philippines and Thailand.
[3] Amid current soft economic condition, financial institutions in Asia region are seeking to expand services in a more cost effective manner by leveraging on information Technology. It presents growth opportunities for the counter. Its evolution path is clear and impressive.
PRICE TREND:
Current price hit support line at 0.5 which was formed last year September. Rebounding signal on last trading day could present accumulation chance.
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