Apex thinks it has a lock on Infoline Tec Group
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00:00 Good morning, we have a new beat today as Apex Securities initiates coverage on IT Infra
00:06 and cybersecurity expert Infoline Tech Group or Infotech with a buy call and RM1.15 target
00:13 price.
00:14 Let's break down the rationale.
00:15 Apex believes that Infotech is riding the rapid pace of technological evolution.
00:20 It is also strategically positioning itself within this high growth industry.
00:25 As according to IMR forecast, the IT infrastructure industry is expected to grow at a Compound
00:30 Annual Growth Rate or CAGR of 9.7% and 18.4% year-on-year in 2024 in Malaysia and China
00:38 respectively.
00:39 Geographically, Infotech has expanded its operations into China, establishing a presence
00:44 across three cities in response to strong demand inquiries.
00:48 Additionally, it has also extended its footprint to Singapore, Japan and India.
00:53 The company has bolstered its steady earnings stream through managed IT services segment
00:57 in a bid to generate recurring income streams.
01:01 Infoline maintained a mutually long-term working relationship with Dell Technologies, which
01:05 is the group's largest customer.
01:07 And Apex reckons that Infoline is well positioned to capitalize on the ongoing and future Dell
01:12 developments within the Asia-Pacific markets.
01:15 Infoline also boasts a healthy balance sheet with zero borrowings and a net cash position
01:18 of 37.9 million, representing 10.42 cent per share or 13.3% of current share price.
01:25 According to Bloomberg, only Apex Securities covers Infoline tech, so based on the RM1.15
01:30 target price, this implies a possible upside of 44% based on its last close of 80 cent.
01:36 Thanks for watching.