Towards Financial Freedom
NeraTel - Potential For Higher Yield
NeraTel's 2QFY13 results came in slightly below expectation, with SGD10.5m PATAMI (+213.4% y-o-y) on the back of SGD47.2m revenue (+13.1% y-o-y). Notably, order intakes increased across all business segments. Reiterate BUY, with our TP unchanged at SGD0.93, based on 11.4x blended FY13/14 P/E (+1 SD). The counter remains as the top pick in our technology sector coverage.
- Higher revenue across all segments. Taking off the negative goodwill gain of SGD7.0m, core PATAMI was SGD3.5m (+4.8% y-o-y). Despite the increase in revenue across all business segments (+29.3% q-o-q), core net profits came in lower (-39.7% q-o-q) as GP margins normalised back to about 30%, along with higher selling and administrative expenses as well as the absence of the other operating income.
- Expanding workforce to capture opportunities. The higher selling and administrative expenses can be justified by the group's ongoing expansion of its workforce to capture the robust opportunities presented in new markets (eg Nigeria). NeraTel has secured SGD121m worth of new orders in 1HFY13 (+21.2 y-o-y).
Source: OSK
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This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
