HLIB starts coverage of ITMAX 5309 ITMAX SYSTEM BERHAD with 'buy' rating, target price of RM1.70

HLIB starts coverage of  ITMAX 5309 ITMAX SYSTEM BERHAD with 'buy' rating, target price of RM1.70

KUALA LUMPUR (Dec 13): Hong Leong IB Research has initiated coverage of ITMAX System Bhd with a “buy” rating at RM1.07 and target price (TP) of RM1.70.

ITMAX operates in two business activities, namely: i) supply and installation of networked systems; and ii) provision of networked facilities, whereby it is a PaaS provider which supplies an integrated and holistic service s compri sing of IaaS, SaaS, AIaaS and DBaaS.

In a note on Tuesday (Dec 13), HLIB said ITMAX’s competitive advantages include: i) in-house R&D team for the design and development of public space networked system; ii) sustainable business model with project based and recurrent revenue; iii) ownership of MAN in Kuala Lumpur; and iv) healthy order and tender books.

“We ascribe a P/E multiple of 25x for ITMAX pegged to FY2024 earnings, resulting in a TP of RM1.70.

“As there is no exact local comparable, the multiple ascribed is in line with its global peers’ average of 24.5x which consists of smart city solution providers, PaaS, IaaS, SaaS, AIaaS and DB aaS players.

“At about only 15.7x FY2024 earnings in on its debut, we believe that this home-grown smart city integrated system and solution provider is a compelling case given its multi-year growth potential on the back of solid order and tender books,” it said.

http://www.theedgemarkets.com/article/hlib-starts-coverage-itmax-buy-rating-target-price-rm170