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12-08-2013, 11:12 PM
Extracts of OSK DMG report from remisiers.org,
Potential For Higher Yield
NeraTel’s 2QFY13 results came in slightly below expectation, with SGD10.5m PATAMI (+213.4% y-o-y) on the back of SGD47.2m revenue (+13.1% y-o-y). Notably, order intakes increased across all business segments. Reiterate BUY, with our TP unchanged at SGD0.93, based on 11.4x blended FY13/14 P/E (+1 SD). The counter remains as the top pick in our technology sector coverage.
Higher revenue across all segments. Taking off the negative goodwill gain of SGD7.0m, core PATAMI was SGD3.5m (+4.8% y-o-y). Despite the increase in revenue across all business segments (+29.3% q-o-q), core net profits came in lower (-39.7% q-o-q) as GP margins normalised back to about 30%, along with higher selling and administrative expenses as well as the absence of the other operating income.
Expanding workforce to capture opportunities. The higher selling and administrative expenses can be justified by the group’s ongoing expansion of its workforce to capture the robust opportunities presented in new markets (eg Nigeria). NeraTel has secured SGD121m worth of new orders in 1HFY13 (+21.2 y-o-y).
Myanmar market set to contribute. NeraTel has already set up an office in Myanmar and is currently recruiting people to bid for upcoming telco projects. While it is still too early for a breakthrough in this frontier, the group has already secured a dominant 90% share in the point-of-sales terminal market in Myanmar.
Sustainable yield hike likely. Most notably, in view of the exceptional cash gain of SGD5.3m, the group declared a surprise interim dividend of 2 cents. As such, we adjust our FY13 full year dividend estimates to 6 cents, translating to an attractive FY13 yield of 7.5%, based on its last closing price of SGD0.795. Going forward, as we are confident of the group’s abilities to deliver around 20% profit growth, we now reasonably expect it to pay higher dividends, adjusting our FY14 DPS forecast to 5 cents.
Potential For Higher Yield
NeraTel’s 2QFY13 results came in slightly below expectation, with SGD10.5m PATAMI (+213.4% y-o-y) on the back of SGD47.2m revenue (+13.1% y-o-y). Notably, order intakes increased across all business segments. Reiterate BUY, with our TP unchanged at SGD0.93, based on 11.4x blended FY13/14 P/E (+1 SD). The counter remains as the top pick in our technology sector coverage.
Higher revenue across all segments. Taking off the negative goodwill gain of SGD7.0m, core PATAMI was SGD3.5m (+4.8% y-o-y). Despite the increase in revenue across all business segments (+29.3% q-o-q), core net profits came in lower (-39.7% q-o-q) as GP margins normalised back to about 30%, along with higher selling and administrative expenses as well as the absence of the other operating income.
Expanding workforce to capture opportunities. The higher selling and administrative expenses can be justified by the group’s ongoing expansion of its workforce to capture the robust opportunities presented in new markets (eg Nigeria). NeraTel has secured SGD121m worth of new orders in 1HFY13 (+21.2 y-o-y).
Myanmar market set to contribute. NeraTel has already set up an office in Myanmar and is currently recruiting people to bid for upcoming telco projects. While it is still too early for a breakthrough in this frontier, the group has already secured a dominant 90% share in the point-of-sales terminal market in Myanmar.
Sustainable yield hike likely. Most notably, in view of the exceptional cash gain of SGD5.3m, the group declared a surprise interim dividend of 2 cents. As such, we adjust our FY13 full year dividend estimates to 6 cents, translating to an attractive FY13 yield of 7.5%, based on its last closing price of SGD0.795. Going forward, as we are confident of the group’s abilities to deliver around 20% profit growth, we now reasonably expect it to pay higher dividends, adjusting our FY14 DPS forecast to 5 cents.
Luck & Fortune Favours those who are Prepared & Decisive when Opportunity Knocks
------------ 知己知彼 ，百战不殆 ；不知彼 ，不知己 ，每战必殆 ------------
------------ 知己知彼 ，百战不殆 ；不知彼 ，不知己 ，每战必殆 ------------
