SIlverLake Axis - Tranche 4
Thesis : Largely unchanged since my assessment last year. Cyclical company that is on the uptrend due to increase in order book(RM340m order backlog). There is general increase in IT Capex of financial institutions. There are core banking contracts (high margin)as well as several (lesser margin) Thai / Malaysian contracts that was won. The financial effects are delayed to be booked in the FY 2018 Annual reports and financial records and the market have not sufficiently priced in the fundamentals. There is understatement of the company's financial performance as most of its books value are booked in the next quarter / financial year . Project related order book value has doubled and this certainly leads to large increase in Accounts receivable and increased cash flow in the future. The macro trend of Fintech in Asia is exceptional favorable, with Singapore Ravi menon stressing on the importance of embracing Fintech and setting up Fintech hub, UOB and OCBC digitalizing banking op...