Smrt Holdings Berhad

The Top Three MoAT (ROA) Achievers in KLSE's Entire IT Sector FYE 2024
= SMRT, ADB, INFOTEC

$SMRT / 0117 (SMRT HOLDINGS BERHAD)
$KLSE-ADB
$INFOTEC / 0253 (INFOLINE TEC GROUP BERHAD)

Below is the MoAT analysis of INFOTEC:

INFOLINE TEC GROUP

i.

MoAT FYE 2024
= ROA
= 100×17,457÷92,917
= 18.7877352906


ii.

Intrinsic Earning Value (MoAT Model) FYE 2024
= ROA × EPS
= 18.7877352906×0.048060589
= RM 0.902949624


iii.

Intrinsic Earning Value (ROIC Model) FYE 2024
= ROIC × EPS
= 26.1598633339×0.0480605899
= RM 1.2572584635


iv.

Intrinsic ATC Number FYE 2024 (ROA Model)
= ROA × √( EPS × [ ROA_Ratio × NCAVPS ] )
= 18.7877352906×√(0.0480605899×(0.187877352906×0.1283763136))
= RM 0.6396591957


v.

Intrinsic ATC Number FYE 2024 (ROIC Model)
= ROIC × √( EPS × [ ROIC_Ratio × NCAVPS ] )
= 26.1598633339×√(0.0480605899×(0.261598633339×0.1283763136))
= RM 1.0509697235


vi.

Intrinsic Invested Capital Value FYE 2024
(Economic Spread Model, formulated by the Nobel Prize Laureates Franco Modigliani and Merton Miller)

= Economic Value Added (EVA) Per Share

= Economic Spread × Invested Capital Per Share

= (ROIC - WACCfinbox) × Invested Capital Per Share

= (26.1598633339-9.3)×0.183718811

= RM 3.0974740453

finbox. com/XKLS:INFOTEC/models/wacc/


vii.

Geometric Mean of Intrinsics
= (0.902949624×1.2572584635×0.6396591957×1.0509697235×3.0974740453)^(1÷5)
= RM 1.1877551539


viii.

Compared to the 10Y DCF Valuation by Finbox :

finbox. com/XKLS:INFOTEC/models


ix.

Compared to the Alphaspread DCF Valuation :

alphaspread. com/security/klse/infotec/dcf-valuation/base-case


x.

Note:

Significance of MoAT:

MoAT (ROA) ≤ 10%
= Lower Compounding Strength & Shorter Compounding Period

15% ≤ MoAT (ROA) ≤ 20%
= Strong Compounding Strength & Long Compounding Runway Period

MoAT (ROA) ≥ 25%
= Supreme Compounding Strength & Extraordinary Long Compounding Runway Period


xi.

Reference:

The Absolute Total Compound Investing Dharma 168:

stockbit. com/post/18380031

List of :
Intrinsic ATC Numbers FYE 2024
&
Intrinsic Earning Values FYE 2024 (ROIC Model)

of IT Stocks

$VSTECS / 5162 (VSTECS BERHAD)
$SMRT / 0117 (SMRT HOLDINGS BERHAD)
$INFOTEC / 0253 (INFOLINE TEC GROUP BERHAD)
KLSE-INFOM
KLSE-CLOUDPT
KLSE-LGMS
KLSE-SNS

1.

Vstecs

Intrinsic ATC Number FYE 2024
= ROIC × √( EPS × [ ROIC_Ratio × NCAVPS ] )
= 13.9237259374×√(0.1979105608×(0.1392372594×1.2393010896))
= RM 2.57

Intrinsic Earning Value FYE 2024 (ROIC Model)
= 13.9237259374×0.1979105608
= RM 2.76

2.

Smrt

Intrinsic ATC Number FYE 2024
= ROIC × √( EPS × [ ROIC_Ratio × NCAVPS ] )
= 28.6059434646×√(0.0595055481×(0.2860594346×0.1370165939))
= RM 1.38

Intrinsic Earning Value FYE 2024 (ROIC Model)
= 28.6059434646×0.0595055481
= RM 1.70


3.

Infotec

Intrinsic ATC Number FYE 2024
= ROIC × √( EPS × [ ROIC_Ratio × NCAVPS ] )
= 26.16×√(0.0481×(0.2616×0.1283763136))
= RM 1.05

Intrinsic Earning Value FYE 2024 (ROIC Model)
= 26.16×0.0481
= RM 1.26

4.

Infom

Intrinsic ATC Number FYE 2024
= ROIC × √( EPS × [ ROIC_Ratio × NCAVPS ] )
= 20.3758848245×√(0.0537164241×(0.2037588482×0.2376582121))
= RM 1.04

Intrinsic Earning Value FYE 2024 (ROIC Model)
= 20.3758848245×0.0537164241
= RM 1.09


5.

Cloudpt

Intrinsic ATC Number FYE 2024
= ROIC × √( EPS × [ ROIC_Ratio × NCAVPS ] )
= 24.9300887995×√(0.0382×(0.249300888×0.1012095561))
= 0.773977222
= RM 0.770

Intrinsic Earning Value FYE 2024 (ROIC Model)
= 24.9300887995×0.0382
= RM 0.950


6.

Lgms

Intrinsic ATC Number FYE 2024
= ROIC × √( EPS × [ ROIC_Ratio × NCAVPS ] )
= 12.9668158796×√(0.0271×(0.1296681588×0.1538640351))
= RM 0.300

Intrinsic Earning Value FYE 2024 (ROIC Model)
= 12.9668158796×0.0271
= RM 0.350

7.

Sns

Intrinsic ATC Number FYE 2024
= ROIC × √( EPS × [ ROIC_Ratio × NCAVPS ] )
= 8.1349243634×√(0.01808316×(0.0813492436×0.0930468481))
= RM 0.0951739895

Intrinsic Earning Value FYE 2024 (ROIC Model)
= 8.1349243634×0.01808316
= RM 0.145


Note:

Intrinsic ATC Number belongs to the Intrinsic Value family.

Intrinsic ATC Number makes sense by integrating the profit, profitability and the net productive asset namely the NCAVPS of the balance sheet together to forge a equilibrium state.

The defective Graham Number could be replaced by ATC NUMBER.

Intrinsic ATC Number is intrinsically more profound, abstruse and has more qualitative contents than Graham Number.

Intrinsic ATC Number
= ROIC × Geometric Mean(EPS, ROIC_Ratio×NCAVPS)
= ROIC × √( EPS × [ ROIC_Ratio × NCAVPS ] )


****


KLSE-INFOTEC

Additional Intrinsic Values (Various Models)


A.

Extrapolated Forward 12 months FYE 2025F :


i.

Extrapolated Forward Intrinsic EVA Value FYE 2025
(formulated by the Nobel Prize Laureates Franco Modigliani and Merton Miller)
= Extrapolated Forward Economic Spread × Extrapolated Forward Invested Capital Per Share
= ( Extrapolated Forward ROIC - WACC ) × Extrapolated Forward Invested Capital Per Share
= (52.30-8.3)×(89,549÷363,229)
= 10.8475810026
= RM 10.85

MOS 50%
= RM 5.42


ii.

Extrapolated Forward Intrinsic Earning Value FYE 2025
(ROIC Model)
= Extrapolated Forward ROIC × Extrapolated Forward EPS
= 52.30×0.1289434489
= 6.7437423775
= RM 6.74

MOS 50%
= RM 3.37


B.

FYE 2024 Intrinsic Values :


i.

Intrinsic EVA Value FYE 2024 (formulated by the Nobel Prize Laureates Franco Modigliani and Merton Miller)
= (ROIC - WACC) × Invested Capital Per Share
= (26.16-8.3)×(66,138+218+376)÷363,229
= RM 3.28

MOS 50%
= RM 1.64


ii.

2-year Net Profit CAGR factor
= ((17,458÷12,118)^(1÷2))
= 1.2002777915

WACC = 8.3% (Finbox)

Discounted Earning Value (Gnp, Wacc & ROA Model)
= 0.0481×(1.2002777915÷1.083)×(1-(1.2002777915÷1.083)^(18.79))÷(1-1.2002777915÷1.083)
= RM 2.91

MOS 50%
= RM 1.45


iii.

MoAT Ratio FYE 2024 (Competitive Return On Asset Ratio)
= ∛(Revenue × Gross Profit × Net Profit) ÷ Total Assets
= ∛(101,326 × 47,298 × 17,457)÷92,917
= 0.470705475

Intrinsic Earning Value FYE 2024 (MoAT Model)
= MoAT × EPS
= 47.0705475 × 0.0481
= RM 2.26

List of :
Multiple On Quality Ratio (MoQ) Valuation @ 52wH @ 8 May 2025:

$SMRT / 0117 (SMRT HOLDINGS BERHAD)
$INFOTEC / 0253 (INFOLINE TEC GROUP BERHAD)
$INFOM / 0265 (INFOMINA BERHAD)
KLSE-CLOUDPT
KLSE-VSTECS
KLSE-ATECH
KLSE-GREATEC
KLSE-FRONTKEN
KLSE-NATGATE
KLSE-SNS
KLSE-LGMS
KLSE-INARI


MoQ, Multiple On Quality Ratio
= √[P² ÷ (BPS × EPS × ROE × ROIC)]


Note:

The Lower The MoQ Ratio, The Greater Bargain On Quality


1.

SMRT
MoQ, Multiple On Quality Ratio @ 52wH RM 1.4
= √[52wH² ÷ (BPS × EPS × ROE × ROIC)]
= √(1.4^2÷(0.18574725×0.0595055481×32.0357626022×28.6059434646))
= 0.4398883275


2.

INFOTEC
MoQ, Multiple On Quality Ratio @ 52wH RM 1.21
= √[52wH² ÷ (BPS × EPS × ROE × ROIC)]
= √(1.21^2÷(0.18×0.0481×26.72×26.16))
= 0.4918577093


3.

INFOM
MoQ, Multiple On Quality Ratio @ 52wH RM 1.6
= √[52wH² ÷ (BPS × EPS × ROE × ROIC)]
= √(1.6^2÷(0.2587×0.0537×20.76×20.38))
= 0.6599618952


4.

CLOUDPT
MoQ, Multiple On Quality Ratio @ 52wH RM 1.08
= √[52wH² ÷ (BPS × EPS × ROE × ROIC)]
= √(1.08^2÷(0.1521×0.0382×25.14×24.93))
= 0.5659573326


5.

VSTECS
MoQ, Multiple On Quality Ratio @ 52wH RM 4.52
= √[52wH² ÷ (BPS × EPS × ROE × ROIC)]
= √(4.52^2÷(1.41×0.196×13.9×13.7791850498))
= 0.6212718505


6.

ATECH
MoQ, Multiple On Quality Ratio @ 52wH RM 3.89
= √[52wH² ÷ (BPS × EPS × ROE × ROIC)]
= √(3.89^2÷(1.13×0.1407×12.45×12.2758885622))
= 0.7891366002


7.

GREATEC
MoQ, Multiple On Quality Ratio @ 52wH RM 2.935
= √[52wH² ÷ (BPS × EPS × ROE × ROIC)]
= √(2.935^2÷(0.3620695971×0.061717757×17.0458269639×16.4061896329))
= 1.1740703157


8.

FRONTKEN
MoQ, Multiple On Quality Ratio @ 52wH RM 4.78
= √[52wH² ÷ (BPS × EPS × ROE × ROIC)]
= √(4.78^2÷(0.46×0.0858×18.65×17.9804332478))
= 1.3139106799


9.

NATGATE
MoQ, Multiple On Quality Ratio @ 52wH RM 3.03
= √[52wH² ÷ (BPS × EPS × ROE × ROIC)]
= √(3.03^2÷(0.414372683×0.0703612278×16.9801800732×8.2300657624))
= 1.5010928857


10.

SNS
MoQ, Multiple On Quality Ratio @ 52wH RM 0.96
= √[52wH² ÷ (BPS × EPS × ROE × ROIC)]
= √(0.96^2÷(0.16×0.0181×11.31×8.4367125036))
= 1.8262239197


11.

LGMS
MoQ, Multiple On Quality Ratio @ 52wH RM 1.8
= √[52wH² ÷ (BPS × EPS × ROE × ROIC)]
= √(1.8^2÷(0.2069×0.0271×13.08×12.97))
= 1.8455837357


12.

INARI
MoQ, Multiple On Quality Ratio @ 52wH RM 4.03
= √[52wH² ÷ (BPS × EPS × ROE × ROIC)]
= √(4.03^2÷(0.7443×0.064×8.6×8.5503858972))
= 2.1532723621

List of :
Pricing @ IT Industry Geometric Average MoQ 0.4573183195 (Multiple On Quality) @ 28.4.2025

$SMRT / 0117 (SMRT HOLDINGS BERHAD)
$INFOTEC / 0253 (INFOLINE TEC GROUP BERHAD)
$INFOM / 0265 (INFOMINA BERHAD)
KLSE-CLOUDPT
KLSE-VSTECS
KLSE-SNS
KLSE-LGMS

KLSE-ATECH
KLSE-FRONTKEN
KLSE-INARI
KLSE-VITROX


Therefore,

1.

SMRT pricing @ IT Industry Geometric Average MoQ 0.4573183195 (Multiple On Quality) @ 28.4.2025
= 0.4573183195÷0.2929591113×0.945
= RM 1.4751745048


2.

INFOTEC pricing @ IT Industry Geometric Average MoQ 0.4573183195 (Multiple On Quality) @ 28.4.2025
= 0.4573183195÷0.3190977701×0.785
= RM 1.1250309919

Very Closed to the Intrinsic EarningValue (ROIC Model)
= ROIC × EPS
= 26.16×0.0481
= 1.258296


3.

INFOM pricing @ IT Industry Geometric Average MoQ 0.4573183195 (Multiple On Quality) @ 28.4.2025
= 0.4573183195÷0.3629790424×0.88
= RM 1.1087144825


4.

CLOUDPT pricing @ IT Industry Geometric Average MoQ 0.4573183195 (Multiple On Quality) @ 28.4.2025
= 0.4573183195÷0.3773048884×0.72
= RM 0.8726873151


5.

VSTECS pricing @ IT Industry Geometric Average MoQ 0.4573183195 (Multiple On Quality) @ 28.4.2025
= 0.4573183195÷0.3958546304×2.88
= RM 3.3271728029


6.

SNS pricing @ IT Industry Geometric Average MoQ 0.4573183195 (Multiple On Quality) @ 28.4.2025
= 0.4573183195÷0.8750656282×0.46
= RM 0.2404007427


7.

LGMS pricing @ IT Industry Geometric Average MoQ 0.4573183195 (Multiple On Quality) @ 28.4.2025
= 0.4573183195÷0.9432983538×0.92
= RM 0.4460230978


REFERENCE :

:: KLSE IT Industry Arithmetic & Geometric Average Multiple On Quality Ratio

( The Lower The MoQ Ratio, The Greater Bargain Over Quality )

1.

KLSE:

IT Industry “Arithmetic Average” Multiple On Quality Ratio @ 28.4.2025
= Arithmetic Average (Smrt, Infotec, Infom, Cloudpt, Vstecs, Sns, Lgms)
= (0.2929591113+0.3190977701+0.3629790424+0.3773048884+0.3958546304+0.8750656282+0.9432983538)÷7
= 0.5095084892


2.

KLSE:

IT Industry “Geometric Average” Multiple On Quality Ratio @ 28.4.2025
= (0.2929591113×0.3190977701×0.3629790424×0.3773048884×0.3958546304×0.8750656282×0.9432983538)^(1÷7)
= 0.4573183195


******************

Are Malaysian stocks cheap? A look at historical valuation benchmarks |

klsescreener. com/v2/news/view/1513017

# Excerpt :

In contrast, Apex Securities head of research Kenneth Leong thinks semiconductor stocks are worth considering at current valuations.

His top picks include Aurelius Technologies Bhd (KL:ATECH), Inari Amertron Bhd (KL:INARI), Frontken Corp Bhd (KL:FRONTKN) and Infoline Tec Group Bhd (KL:INFOTEC).

# Remark:

KL:INFOTEC is the only IT Solution stock in the Top Picks of Kenneth Leong.

Not surprising at all viewing the expansion and growth of KL:INFOTEC ascending year after year.


# Relative Valuation Analysis:

Multiple On Quality Ratio, MoQ
= Multiples On Profitabilities Ratio, MoP

( The Lower The Ratio, The Greater Bargain On Quality )

i.

INFOTEC
MoQ, Multiple On Quality Ratio @ 28 Apr 2025
=
√
[
P² ÷ (BPS × EPS × ROE × ROIC)
]
= √(0.785^2÷(0.18×0.0481×26.72×26.16))
= 0.3190977701

P/E @ 0.785
= 16.32

ii.

ATECH
MoQ, Multiple On Quality Ratio @ 28 Apr 2025
=
√
[
P² ÷ (BPS × EPS × ROE × ROIC)
]
=
√(3.15^2÷(1.13×0.1407×12.45×12.2758885622))
= 0.6390180696

P/E @ 3.15
= 22.39


iii.

FRONTKEN
MoQ, Multiple On Quality Ratio @ 28 Apr 2025
=
√
[
P² ÷ (BPS × EPS × ROE × ROIC)
]
= √(3.47^2÷(0.46×0.0858×18.65×17.9804332478))
= 0.9538221881

P/E @ 3.47
= 40.44


iv.

INARI
MoQ, Multiple On Quality Ratio @ 28 Apr 2025
=
√
[
P² ÷ (BPS × EPS × ROE × ROIC)
]
=
√(1.92^2÷(0.7443×0.064×8.6×8.5503858972))
= 1.0258766589

P/E @ 1.92
= 30.0

**********************

More references:

MoQ, Multiple On Quality Ratio
( The Lower The MoQ Ratio, The Greater Bargain On Quality )
= Multiples ÷ Profitabilities
=
√{ (P/B)×(P/E) } ÷ √{ ROE×ROIC }
=

√
[
{ (P/B)×(P/E) } ÷ { ROE×ROIC }
]

=

√
[
P² ÷ (BPS × EPS × ROE × ROIC)
]


( The Lower The MoQ Ratio, The Greater Bargain On Quality )


1.

SMRT

MoQ, Multiple On Quality Ratio @ 28 Apr 2025
=
√
[
P² ÷ (BPS × EPS × ROE × ROIC)
]
= √(0.945^2÷(0.182×0.0595×32.85×29.25))
= 0.2929591113

P/E @ 0.945
= 0.945÷0.0595
= 15.88


2.

INFOTEC
MoQ, Multiple On Quality Ratio @ 28 Apr 2025
=
√
[
P² ÷ (BPS × EPS × ROE × ROIC)
]
= √(0.785^2÷(0.18×0.0481×26.72×26.16))
= 0.3190977701

P/E @ 0.785
= 16.32


3.

INFOM
MoQ, Multiple On Quality Ratio @ 28 Apr 2025
=
√
[
P² ÷ (BPS × EPS × ROE × ROIC)
]
= √(0.88^2÷(0.2587×0.0537×20.76×20.38))
= 0.3629790424

P/E @ 0.88
= 16.39


4.

CLOUDPT
MoQ, Multiple On Quality Ratio @ 28 Apr 2025
=
√
[
P² ÷ (BPS × EPS × ROE × ROIC)
]
= √(0.720^2÷(0.1521×0.0382×25.14×24.93))
= 0.3773048884

P/E @ 0.720
= 18.85


5.

VSTECS
MoQ, Multiple On Quality Ratio @ 28 Apr 2025
=
√
[
P² ÷ (BPS × EPS × ROE × ROIC)
]
= √(2.88^2÷(1.41×0.196×13.9×13.7791850498))
= 0.3958546304

P/E @ 2.88
= 14.693877551


6.

SNS
MoQ, Multiple On Quality Ratio @ 28 Apr 2025
= √(0.46^2÷(0.16×0.0181×11.31×8.4367125036))
= 0.8750656282

P/E @ 0.46
= 25.41


7.

LGMS
MoQ, Multiple On Quality Ratio @ 28 Apr 2025
=
√
[
P² ÷ (BPS × EPS × ROE × ROIC)
]
=
√(0.92^2÷(0.2069×0.0271×13.08×12.97))
= 0.9432983538

P/E @ 0.92
= 33.95


8.

FRONTKEN
MoQ, Multiple On Quality Ratio @ 28 Apr 2025
= √(3.47^2÷(0.46×0.0858×18.65×17.9804332478))
= 0.9538221881

#
CONCLUSION:

SMRT, INFOTEC, INFOM, CLOUDPT are EXTREMELY UNDERVALUED relative to LGMS, SNS & FRONTKEN.
#

HLIB TOP PICKS 2025...

Sturdier ship but choppier waters.

- Enter Trump 2.0. We expect heightened market volatility in 1H25 as investors grapple with the incoming policy
risks from Trump’s presidential comeback. That said, we are inclined to believe that he will take a more nuanced approach on tariffs – in a targeted manner rather than blanket – seeing that this would have an inevitable impact on inflation. Last year, Malaysia accounted for only 2.5% of US’ trade deficit (ranked 12th), while the top five countries (China, Mexico, Vietnam, Germany and Canada)
collectively made up 66%. While noting the upside bias to
Inflation from Trump’s tariff tantrums, we still expect the Fed to continue with its rate cuts by -50bp in 2025 – though this is softer than its official forecast of -100bp. With further narrowing of the FFR-OPR spread, this should provide some appreciation bias to the ringgit (our end-2025 USD-MYR target is 4.10) and local bourse (being inversely correlated to the former at -45%).

- Malaysia on a sturdier ship. External headwinds aside, perhaps it would be useful to reflect that Malaysia is now on a sturdier ship with steady growth, subsidy reforms in motion, robust investment pipeline, and a more stable political climate. We feel that foreigners have yet to fully
appreciate the country’s ongoing rejuvenation given their
continued underweight position on Malaysia, though now at a smaller quantum. The Fed’s ongoing rate down-cycle should help risk appetite for emerging markets resurface, particularly in countries such as Malaysia that aren’t in the tariff spotlight. A reprieve in foreign shareholding levels should be positive for the KLCI given the 69% correlation between the two.

- Key themes. We remain upbeat on the following
investment themes for 2025: (i) disposable income boosters, (ii) tourism shifting from recovery to record, (iii) Johor’s developmental reinvigoration, (iv) energy transition amidst a data centre boom, – while Trump’s impending presidency cold see revived interest in (v)
trade war plays.

$YTLPOWR / 6742 (YTL POWER INTERNATIONAL BHD)
$NOTION / 0083 (NOTION VTEC BERHAD)
$SMRT / 0117 (SMRT HOLDINGS BERHAD)

$SMRT / 0117 (SMRT HOLDINGS BERHAD)
Research by HLIB

HLIB TOP PICKS Q4 2024

Rejuvenation of domestic fundamentals. Our positive stance on Malaysian equities goes beyond the Fed’s rate down cycle as the country is seeing rejuvenated domestic fundamentals with GDP growth picking up, record approved investments and subsidy reforms in motion, alongside a more stable political landscape. We remain upbeat on the following themes that we had earlier introduced for 2024: (i) continued robust tourism recovery, (ii) energy transition under NETR, (iii) Johor’s developmental reinvigoration, (iv) disposable income boosting measures from EPF Account 3 and civil servants pay hike and (v) trade diversion and proliferation of the China+1 strategy from the US-China trade war.

$YTLPOWR / 6742 (YTL POWER INTERNATIONAL BHD) $AIRASIA / 5099 (AIRASIA GROUP BERHAD) $SMRT / 0117 (SMRT HOLDINGS BERHAD) $MNHLDG / 0245 (MN HOLDINGS BERHAD) $IOIPG / 5249 (IOI PROPERTIES GROUP BERHAD)

$SMRT / 0117 (SMRT HOLDINGS BERHAD)
Research by HLIB
BUY – TP RM2.28

" Robust outlook ahead”

SMRT ended FY24 on a high note, with managed site additions exceeding our expectations. Looking ahead to FY25, we expect strong site deployments to continue, supported by a robust pipeline from PAPI, TNB, and potential contributions from PLN. In particular, the upcoming RP4 period is likely to drive higher deployments from TNB, bolstered by increased approved capex. We also anticipate strong deployment in both Indonesia and the Philippines, driven by PLN and PAPI, respectively. Overall, we maintain our BUY call with an unchanged TP of RM2.28. SMRT remains one of our top picks in the tech application sector.

Analyst:
Sam Jun Kit
jksam@hlib.hongleong.com.my
Tan J Young
jytan@hlib.hongleong.com.my

Titan Weekend Chart Reviews

$SMRT / 0117 (SMRT HOLDINGS BERHAD)

Since retracing back towards the RM 0.95+ support levels, was able to rebound and hold back above its RM 1.10+ main support region.

For now slowly rebounding back towards the RM 1.18+ regions. Seems to be regaining its strength now and could trend back towards the RM 1.27+ regions soon.

Looks quite stable here, perhaps due to EPF's emergence as a substantial shareholder.

Support: RM 1.15, RM 1.10 areas
Resistance: RM 1.20, RM 1.27, RM 1.30, RM 1.40 areas

Titan Trading Notes For Tuesday [27/8/2024]:

$KLSE-KLCI had a decent rebound back towards the 1638 points region with an overall mixed market sentiment as we still saw over 570 counters closing red for the day. Daily trading volume remains quite low around the 2.8 billion mark.

Honestly, it feels like a yo-yo market here despite US market performing quite well and with foreign fund flowing into our market. Our market lacks liquidity. From reaching a daily trading volume of over 7 billion just months ago, to heading back towards 2.8 billion, there is a huge difference.

In terms of market sentiment, it looks like we're in a consolidation phase now after a huge profit taking round over the past 1-2 months. Solid trading opportunities come few and far between. Plus, we won't know when the rally will stop and have a sudden huge sell down as witnessed from the likes of $NOTION / 0083 (NOTION VTEC BERHAD) .

We will have to navigate through this rough path with caution. I believe our overall market will be in an uptrend, but it won't be as smooth as you think.

Main stocks that showed strong buying momentum today would be the likes of ELRIDGE, WCT, SIMEPROP, BPURI, CUSCAPI, PERDANA, SUNWAY, DAYANG, and SCB. All of which were able to sustain their rallies throughout the day on the top volumes list.

ELRIDGE since its IPO debut, had been breaking out over the past 2 days, rallying all the way towards the RM 0.455 regions today, forming a new all time high region despite the mixed market sentiment.

For now still looking quite strong here and not showing any signs of weakness yet. As long as able to hold above its RM 0.43 immediate support levels, could continue on towards and beyond the RM 0.455+ regions in the coming few days.

Will be monitoring ELRIDGE closely here as seems to be trending up strong.

$WCT / 9679 (WCT HOLDINGS BERHAD) since taking a hit earlier this month, retraced all the way back towards the RM 0.95+ major support level regions and formed a strong base there during the weak market sentiment.

Today, it was able to breakout from its RM 1.03 immediate downtrend resistance levels with good volume and buying momentum, rallying all the way towards the RM 1.10+ regions here.

So far looking quite bullish and as long as able to sustain above its RM 1.03 support, could continue on to trend up back towards the RM 1.17+ regions soon. Will be monitoring WCT closely here.

$SMRT / 0117 (SMRT HOLDINGS BERHAD) since retracing all the way back towards the RM 0.97+ major support levels earlier this month, had been able to rebound strong and gain momentum, forming its higher low region around the RM 1.09+ support on the daily chart.

So far seems to be holding on quite strongly here and if able to sustain, could breakout back above the RM 1.20+ regions and trend up towards and beyond the RM 1.30 - RM 1.40+ major resistance levels for an uptrend continuation pattern.

Will be monitoring SMRT closely here.

$SMRT / 0117 (SMRT HOLDINGS BERHAD)
Research by HLIB
Buy - TP RM2.28

"Ending with a bang"

SMRT reported FY24 core net profit of RM26.1m, which came in above our projection at 113%. The outperformance was mainly driven by stronger-than-expected site deployments throughout the year. Looking ahead, we expect sequential growth in 1HFY25 as utility companies typically ramp up capex spending during this period. Additionally, SMRT remains optimistic about reaching 1k PAPI sites in the Philippines by 2QFY25, which will further strengthen its recurring income base. Maintain BUY with unchanged TP of RM2.28 based on 30x P/E on FY26f EPS of 7.6sen.

Analysts:
Sam Jun Kit
jksam@hlib.hongleong.com.my
Tan J Young
jytan@hlib.hongleong.com.my

$SMRT / 0117 (SMRT HOLDINGS BERHAD)

$WCT / 9679 (WCT HOLDINGS BERHAD)
$NOTION / 0083 (NOTION VTEC BERHAD)
$MAHSING / 8583 (MAH SING GROUP BERHAD)
$SCGBHD / 0225 (SOUTHERN CABLE GROUP BERHAD)
$SMRT / 0117 (SMRT HOLDINGS BERHAD)
...

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - URUSHARTA JAMAAH SDN. BHD.

$SMRT / 0117 (SMRT HOLDINGS BERHAD)

Sharing from my remisier

🔥 *Stock in focus: SMRT (FV RM2)* 🔥
We recently met with SMRT’s management and believe the market is undervaluing the company's growth potential.

*_Valuations and fair value_*
- SMRT is currently trading at a conservative valuation of 14.1x CY25 earnings, compared to peers trading at 24x.
- We estimate the fair value of SMRT to be RM2/shr, applying a target PER of 24x to CY25 earnings projected at RM36mn.
- SMRT presents a compelling investment opportunity with substantial upside potential, driven by its scalable business model, strong customer relationships, and expanding market opportunities in Southeast Asia.

*_Who is SMRT?_*
- Specializes in IoT solutions, offering scalable end-to-end wireless network connectivity services, including equipment installation, monitoring, maintenance, data collection, and network surveillance.
- High recurring revenue (over 50%) and minimal capex.

*_Growth drivers_*
- FY24E profit – RM25-26mn
- 9MFY24A net profit – RM20mn, 80% of full year estimates
- Net profits are expected to grow at 22-23% annually over the next two years (FY25 & FY26)
- Dirven by expanding site deployments, notably with major customers like TNB, PT PLN (Indo), and new ventures with financial and water utilities clients such as Pito AxM Platform (PAPI) and Air Selangor
- From 4,500 sites in FY24 to 6,000 sites in FY25 and 7,500 sites in FY26

*_Utilities sector expansion is particularly promising_*
- TNB plans to deploy an additional RM35bn between 2025-2030 towards upgrading power grid.
- TNB aims to achieve 41% of cumulative installation of distribution automation at substations by end of 2024, 64% by end of 2027 and 84% by end of 2030 from only 29% as of end 2023.
- SMRT has secured 5 out of 22 regions which include Lampung, Nusa Tenggara Timur, Jawa Barat, Kalimantan Timur dan Utara and Jakarta.

*_Other sectors_*
- SMRT's contract with PAPI in the Philippines for ATM infrastructure is progressing well
- Management maintained its target of rolling out its managed ATM infrastructure solution to 1,000 sites by end of CY2024.
- We understand that SMRT has deployed about 100 sites so far.
- Hence, PAPI is expected to add 900 sites in 1HFY25.
- To note, PAPI has approximately 3,000 sites in the Philippines.
- SMRT has secured a multi-year deal with Air Selangor to digitalize water management, which is anticipated to provide incremental revenue starting FY25.

Change in Boardroom - MR ARTHUR JACK HOGARTH

Change in Audit Committee - MR ARTHUR JACK HOGARTH

Change in Audit Committee - IR KAMALIAH BINTI ABDUL KADIR

Change in Risk Committee - IR KAMALIAH BINTI ABDUL KADIR

Change in Remuneration Committee - MR ARTHUR JACK HOGARTH

Change in Nomination Committee - IR KAMALIAH BINTI ABDUL KADIR

Change in Risk Committee - MR ARTHUR JACK HOGARTH

Change in Nomination Committee - MR ARTHUR JACK HOGARTH

Change in Remuneration Committee - IR KAMALIAH BINTI ABDUL KADIR

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - URUSHARTA JAMAAH SDN. BHD.

Changes in Sub. S-hldr's Int (Section 138 of CA 2016) - URUSHARTA JAMAAH SDN. BHD.

Change of Company Secretary - LIM LI HEONG

Change of Company Secretary - WONG MEE KIAT

Change of Company Secretary - YIP SIEW CHENG

Change of Company Secretary - WONG YOUN KIM