Supportive  parent  allows  for  collaborative  opportunities.  NeraTel's  new  parent, Northstar,  allows  for  potential  collaborative  opportunities  with  one  of  its  telco  equipment business which own and charter out radio masts and towers. NeraTel could gain business through supplying radio equipment used in these towers.   

Well-positioned  to  tap  on  the  robust  Telco  spending  outlook.   With  data  demand increasing rapidly (14x increase over the next five years), telecommunication networks are becoming increasingly congested. Consumers gradually place greater emphasis on speed and  it  may  emerge  as  one  of  the  most  important  criteria  for  them  to  choose  a  mobile carrier. As such, we expect carriers to channel increasing amount of resources to upgrade their existing infrastructure. With a 60 year brand name and track record, NeraTel is able to capture  this  growing  pie  along  with  improved  margins  through  offering  higher  value-add services such as system consulting and design.

More  recurring  revenue  stream  from  the  stellar  POS  business. With the boom of the Southeast  Asia  consumer  market  and  the  gradual  maturity  of  the  banking  infrastructure comes  the  need  for  efficient payment systems. NeraTel's point-of-sales  terminal  (POS) business  is  set  to  grow.  Management  is  confident  to  grow  from  220,000  terminals  at  the moment to 300,000 within a year, boosting its recurring revenue stream.

New  Myanmar  story.  Management  also  shared  that  NeraTel  has  made  a  small  but significant  step  into  the  Myanmar  market.  Its  entry  involves  both  the  telecommunication infrastructure business and its POS business. They have done telco infrastructure project as  well  as  help  a  number  of  retailers  set  up  POS  locally.  We  believe  that  given  time, NeraTel  will  make  its  name  in  the  Myanmar  market  as  its  strong  financial  position  and established  track  record  puts  it  in  a  much  more  favourable  position  than  its  peers  (e.g. SGX-listed Ntegrator).

Source: OSK