- Venture Corp (SGX:V03)'s 3Q23 PAT was down 35% y-o-y to S$63mil. The results were below expectations. 9M23 revenue and PAT were 70%/69% of our FY23e forecast. Soft demand and inventory adjustment continue to weigh down on revenue and earnings.
- - Read this at SGinvestors.io -
- We cut our FY23e revenue and PATMI forecast for Venture Corp by 7% and 8%, respectively.
- We maintain our NEUTRAL recommendation on Venture Corp with a lower target price of S$12.50 (previously S$15.20).
The Positive
Recovery in net cash.
- - Read this at SGinvestors.io -
- Inventory declined by S$304mil y-o-y to a still elevated S$949mil. Inventory is high compared to pre-pandemic levels of around S$700mil.
The Negatives
Weakness in margins.
- There was no disclosure of gross margins this quarter. But assuming interest income was similar to prior quarters, Venture Corp's operating margins declined by at least 1% point. This was despite staff costs declining around 9% y-o-y.
Revenues lump.
- Read more at SGinvestors.io.
