Singapore Myanmar Investco (SMI) reported its 1H18 results yesterday evening. Revenue grew 20.9% to US$11.6m, underpinned by healthy growth in Duty Free & Fashion Retail and Construction Services.

Gross profit increased 52.5% YoY to US$3.1m, supported by an increase in gross profit margin from 21.1% in 1H17 to 26.6%. The group recorded a net loss of US$2.1m from continuing operations, vs. a net loss of US$1.6m in 1H17.

Part of the increase in net loss was due to one-off items in the previous half-year including a US$300k write-back of over-accrual of bonus and a US$137k write-back of over-accrual of corporate secretarial costs in 1H17.

Pending further details and a change in covering analyst, we maintain BUY but place our S$0.97 fair value estimate (16x FY19F; year ending Mar 2019) under review.

Source: OCBC Research - 14 Nov 2017