Revenue and profit trend from their current mobile digital and SMS business has been trending downwards for the past couple of years. FY 19 is expected to be worst based on the 1Q19 result where revenue fell to less than RM3mil.
New revenue and profit growth was supposed to come mainly from its new telco venture in Thailand but all that was scrapped back in October. At the moment there is no indication by the management on whether they have identified any other businesses that has the same high potential as the Thai venture.
I was initially attracted to invest into the company due to its high cash balance and low debt level (net cash of RM30.5mil). However, most of this cash that was raised during during the last right issue exercise back in November are already assign to specifics projects. Most of the remaining RM30 mil will be used to expend further the company's current business.
You should only invest in this company if you believe that management would be able to turnaround the company via further expansion of the company current businesses. It would be better for you to wait for the next quarter to see if things has started to turnaround or not ( i have my doubts on this).
Hopefully all the new investment that the company had make and going to make will start to bear fruits soon and compensate those investors that had put their confidence in the company's management.
For those looking to diversify in companies outside of the Telco/ Media industry, i would recommend you to look at MBMR.
MBMR is a direct proxy to Perodua via its 22.6% interest in the company. Valuation is cheap at only 5.8x PE (based on target FY18 PATAMI of RM145mil. 9m PATAMI is already RM106mil). PB is low at only 0.5x BV. 4Q18 results is expected to be higher than 3Q18 and last year's 4Q17. And FY19 growth will be driven by the still high demand of new Myvi and the launch of the new SUV in 1Q19.
Hey! Today, R-Table will be covering mTouche Technology Berhad by presenting 10 years financial results in a short, fun & interesting way. Click the link below to watch the video.
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....
kingcobra
2,772 posts
Posted by kingcobra > 2017-11-29 08:52 | Report Abuse
pasti bolih!