Infoline Tec Group Berhad - Aggressive expansion hampered margins
Tue, 04-Jun-2024 08:22 am
by Jayden Tan • Apex Research

Counter

INFOTEC (0253)

Target Price (RM)

0.905

Recommendation

Buy

Summary

  • 1QFY24 net profit at RM225k lagged behind our expectations on higher administrative costs and lower profit margins as a result of the Group's aggressive expansion and acquisition of new customers.
  • Looking ahead, we are positive on recovery prospects, particularly in 2H24 from billings of new contacts secured.
  • We maintain our BUY recommendation with lower target price of RM0.905 by pegging PE multiple of 17.0x to FY25f EPS of 5.3 sen.
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