Venture Corp (SGX:V03)'s FY22 results were within expectations. Revenue and PATMI were 102%/97% of our FY22e forecast. 4Q22 PAT rose 3.4% y-o-y. Gross margin was the weakest in seven years.
There was caution in the company’s outlook. The environment in the short term is uncertain. Healthcare, life science and semiconductor sectors are the medium-term opportunities with their long product cycles.
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Our target price for Venture Corp is lowered to S$19.70 (previously S$20.80), 16x P/E FY23e. The macro backdrop for electronic exports has declined significantly and the global economy slowing.
The Positive
Healthy growth in revenue.
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Pre-pandemic, revenue growth was a negative 4% from FY17 to FY19. We also expect revenue growth to slow in 2023 with the absence of the Malaysia re-opening lift experienced in 2022.
The Negative
Major decline in margins.
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Above is an excerpt from a report by Phillip Securities Research. Clients of Phillip Capital may be the first to access the full PDF report @ https://www.stocksbnb.com/.
