Aztech Global - Inflationary Cost Pressures Showing Up
- Aztech (SGX:8AZ)'s 1Q22 revenue at 16.8% of our/Bloomberg consensus full-year forecasts was below that achieved in FY21 where 1Q was 18.6% of full-year performance.
- Aztech's 1Q22 net profit at 15.4%/15.3% of our/Bloomberg consensus FY22F forecasts was below that achieved in FY21 (1Q:17.7% of FY21 performance).
- Aztech continued to benefit from a lower effective tax rate of 12.6% in 1Q22 versus 13.2% in 1Q21. Net cash position has increased to S$289.3m as at end Mar-2022 from S$186.8m as at end Dec-2021.
- On outlook, Aztech guided that the electronics supply chain and its operations remain vulnerable to new COVID-19 outbreaks in China and lockdowns.
- We reiterate our ADD call on Aztech with a target price of S$1.59. As at 18 Apr 2022, order book for fulfillment in FY22F is S$713.0m.
Above is the excerpt from research report by CGS-CIMB.
Clients of CGS-CIMB may access the full report in PDF @ https://www.itradecimb.com.sg/.
William TNG CFA CGS-CIMB Research | https://www.cgs-cimb.com 2022-04-19 2022-04-19
Previous report by CGS-CIMB:
2022-03-15 Aztech Global - Dongguan Also In Lockdown
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