• Maintain BUY. TP (RM1.78). Infomina’s 9MFY24 core PATAMI of RM25.8mn was within our in-house expectation (79%) but below market forecast (56%). During 3QFY24, revenue slid 14.9% QoQ, no thanks to sluggish revenue from both Turnkey and Renewal segments. Nonetheless, operating profit soared 15.3% QoQ, underpinned by better earnings from Turnkey segment (+97.8% QoQ). We maintain a positive outlook on the group's strategic initiative to expand its presence in North Asia such as Japan, and concurrently strengthening its position in regional countries like Thailand and the Philippines. Leveraging Infomina's R&D and technological expertise, we are optimistic about its ability to effectively secure both turnkey and renewal projects. We make no changes to FY24-25F earnings assumption. Maintain a BUY call on Infomina, with unchanged TP of RM1.78.

• Key Highlight. The operating profit for 3QFY24 saw improvement, driven by contracts from Malaysia, particularly from the government sector. Additionally, the revenue breakdown for this quarter was mainly from the Renewal segment, accounting for 62.7%.

• Forecast. Unchanged.

• Outlook. The group is optimistic about its significant investment initiatives in research, development, and technology expansion. The company is focused on exploring new customers, fostering business growth, and strengthening its brand presence, both locally and globally. Additionally, the group has recently made a successful entry into the Japanese market and is expected to make a meaningful contribution to the group's revenue by the end of FY24.

• Our call. Maintain a BUY call with unchanged TP of RM1.78. Our valuation pegged at 23.4x PER (10% discount to weightage sector average of 26x) and FY25F EPS of 7.6sen. The discount is applied to account for potential downside risks associated with the drawdown of contracts from Renewal customers and lower-than-expected contracts from the Turnkey segment.

Source: BIMB Securities Research - 19 Apr 2024