May[12] - Declout (Proxy to IoT, Big Data and eCommerce era)

COUNTER: DECLOUT LTD

OVERVIEW:
Listed on Catalist Board in 2012, Declout is a Singapore based incubator of next-generation Information and Communication Technologies (ICT) companies with enviable track record. It's portfolio companies are grouped within two segments: IT Infrastructure (Infra) and Vertical Domain Clouds (VDC). The former forms one-stop data centre deployment and operations value chain, and latter focus on building e-Commerce VDC. Last December, it established investment subsidiary which involves in incubation and fund-raising facilitation for startups and growth enterprises.

Until now, it has built a range of IT products and solutions that are deployed across Asia-Pacific, US and Europe. It's subsidiaries as below.

HIGHLIGHTS:
[1]  On FY2016, it successfully spun off two business from Infra segment: the $156m listing of Procurri on SGX Mainboard and also completion of divestment of Acclivis to CITIC Telecom Group for up to $75m. It demonstrated the group's capability in invest-to-harvest strategy. 

[2] Last quarter saw the revenue and gross profit up 11% and 23% year on year. Both Infra and VDC segment saw significant growth. However it registered net loss 3.4m, due to administrative expenses incurred from newly setup joint venture and acquisition. Management indicated that first quarter used to be traditional slower period. Same quarter last year saw net loss 4.4m.

[3] Its debt gearing is 27%, with majority to be repaid in following year.

INVESTMENT THEMES:
[1] 1Q Earning per shares - (0.0041) || Book Value - 0.172
Last trading price, 0.162 translates to PB ~ 0.9.

[2] Record of excellent growth in revenue and earning over past five years.

[3] Subsidiary, Beaqon (telecommunications, network infrastructure and security arm) has been identified as next growth driver. Aligned with Singapore government's push towards a Smart Nation, Beaqon well position to be an end-to-end ICT market leader. Last year, it clinched major contracts in the build out of new data centres in Singapore, as well as key network infrastructure projects.

[4] Company has been buying back shares since April 2016. The directors also raised shareholding from open market recently as well. Holding on cash $34m, management is seeking for opportunities in further M&A.

PRICE TREND:
Price is hovering near to two year support ~ 0.161. Accumulation activity happened around last April.

May[11] - Market Updates

Singapore:
STI moved between 3189 to 3273 since May. Trend looks flat while US indices are hitting record high. Most of the STI constituents have expired with dividend entitlement. Oil price has been stable upon OPEC meeting. Looking forward, US FOMC meeting on coming June shall be next market event which might give a direction on market.

Market Calendar on coming week:
(SG: Singapore; CH: China; UK: United Kingdom; US: USA; JP: Japan)

Chart[47] - Golden Engergy

The counter showed strong earning result last Monday. However, stock price moving downwards on following days. Last two trading days, price slowly moved up with rising volume as shown in first chart. Its director has been raising stakes on the company from open market at the same time as well.

Looking at second chart, price capped at soft resistance ~ 0.445. Shall buying interest continue, trader could aim for next resistance ~ 0.48. Support lever is ~ 0.4.

May[10] - Financial Highlights

The following counters released respective latest financial results last week. A summary is provided.
Bumitama, CNMC Goldemine, Golden Energy, Mermaid Maritime, Nam Cheong, SATS, SIA, Silverlake Axis, Singtel and Spackman

May[9] - Market Update

Crude Oil:
Following co-announcement between Saudi and Russia about extension of oil production cut, oil price completed its second week of rally. Looking backwards, strong resistance should be faced around 53~ 54. Trader could position on potential correction on oil price by using Inverse Oil ETF: SCO (listed in US). Next week we will see meeting among OPEC and non OPEC about oil production of next half year. Last FOMC meeting minutes will be disclosed on coming week also. Rising interest rate might dampen commodity prices.

Market Calendar on coming week:
(SG: Singapore; CH: China; UK: United Kingdom; US: USA; JP: Japan)

Chart[46] - Declout

The counter released its latest financial results on last trading day. Both revenue and gross profit up 11% and 24% year on year. It registered net loss for the quarter because of administrative expenses incurred for recent joint venture. As show in first chart, it encountered strong buying volume on mid April. Company was buying back shares on that period as well.

As shown in second chart, price retreated to support with thin volume. Coming Monday will see market response to the result. Shall buying volume rises, price move ahead to first resistance ~ 0.18.

May[8] - Financial Highlights

The following counters released respective latest financial results last week. A summary is provided. Perennial, QAF, SIA Engineering, Singpost, SUTL, VICOM and Asian Pay TV Trust