• Riding on the fast expanding IoT market with ~90% revenue exposure.
• Above industry net margins of > 10%, with reputable global customer base.
• R&D capabilities, a key differentiator, enables Aztech to be a one-stop service provider.

IoT Market Is Still at the Nascent Stage of Growth

• With ~90% revenue exposure, Aztech Global (SGX:8AZ) is in a sweet spot to ride on the fast expanding IoT market which is projected to grow at a CAGR of 20.8% during 2019-2023F. We expect the orderbook momentum to remain strong, translating to revenue growth of 42% in FY21F and another 30% in FY22F.

Aztech Global - Company Background

More than 30 years in business.

• Aztech’s origins can be traced back to 1986 when its Executive Chairman and CEO, Mr. Michael Mun, founded the business to undertake the design, manufacture and distribution of PCs. Aztech’s product range has expanded over the years to include other electronics products ranging from sound cards and DECT phones to its current focus areas of IoT Devices, Data communication products and LED lighting products.

Transformation into IoT, data communication and LED lighting products focused business.

• Aztech has transformed from an OEM player into a full-fledged customers mainly in the IoT Devices and Data communication and LED lighting sectors.
• As at 11 December 2020, Aztech has over 270 online commerce companies and leading lighting companies.
• Aztech’s manufacturing facilities are located in Dongguan, Guangdong Province, the PRC, and Johor, Malaysia.

Initiate Coverage on Aztech With BUY

• Summary of analysis to be update. Meanwhile, refer to report attached below for complete analysis on Aztech Global (SGX:8AZ).

Source: DBS Research - 22 Apr 2021