• ISDN Holdings (SGX:I07) has announced a partnership with Whizpace Pte Ltd (unlisted) to deploy the latter’s Super Wifi offerings.
• As for it hydropower business, the company is still working towards commercialisation for two of its plants by end-FY21F.
• Reiterate ADD call on ISDN. Our target price remains at S$0.84.

Adding Super Wifi to ISDN's Offering

• On 18 Jun 2021, ISDN announced a global strategic partnership with Whizpace Pte Ltd (unlisted) to deliver wide-area Industry 4.0 and Internet of Things (IoT) solutions globally. This partnership helps ISDN extend the reach of its Industrial Automation solutions into new areas where intelligent devices are connected over wide spaces such as farms, oil fields, ships, forests and mines.
• Whizpace’s patented TV band connectivity (Super Wifi) fills an important gap in ISDN’s portfolio of industrial connectivity technologies. By providing reliable, low-energy connectivity in the 2km to 10km+ range, Whizpace allows ISDN to deliver automation solutions to farming, transportation, utilities, pipelines and other wide-area industrial operations.

What Is Super Wifi?

• TV White Space (TVWS) or Super Wifi are wireless spectrums in the TV bands that are not fully utilised by licensed services such as TV broadcasts and are made available for other users. The switch to digital TV has opened more opportunities for Super Wi-Fi. Some of the most immediate beneficiaries will be people living in areas that cannot be affordably reached with existing technologies (such as rural inhabitants) as well as sparse populations spread out over large areas in remote parts of developing markets such as Africa.
• The most common then tell the device which TV white space channels to operate on.

Hydropower Still a Year End Goal

• With regards to its hydropower plant projects in Indonesia, ISDN has three hydropower projects under construction. Management is into the hydropower plants, of which about 64% is equity funded and the balance 36% debt funded.

Reiterate ADD Call on ISDN

• We reiterate our ADD call on ISDN. Our target price of S$0.84 is based on 12.5x Singapore tech sector’s CY22 average P/E (currently the sector average is 14.0x).

• Potential re-rating catalysts could come from stronger-than-expected cost overruns in its hydropower business and any disruption to business activities due to the ongoing COVID-19 pandemic.

Source: CGS-CIMB Research - 23 Jun 2021