• Maintain BUY, new DCF-based Target Price of SGD0.57 from SGD0.65, 24% upside.
• We cut FY19-20F earnings by 7% on higher administrative costs. 
• Silverlake Axis reported decent 4Q18 numbers, with recurring PATMI up 3% y-o-y, ie in line with our estimate. However, earnings should grow strongly in FY19-20 – with FY18 marking the bottom of its earnings cycle – as it has managed to clinch new key banking projects that significantly boosted its orderbook to > MYR350m.
• With more projects ahead, we are positive on its outlook.

Silverlake Axis’ Orderbook Is Still at a Healthy MYR380m

The orders are scheduled to be realised in FY19-20 (of which at least MYR200m will be recognised in FY19). Orderbook levels like this have not been seen since FY15- 16 – which is a positive sign towards profitability going forward.

Source: RHB Invest Research - 28 Aug 2018