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Wednesday, April 15, 2015

NEXT For IFCA ... Other Catalysts Apart GST Upgrade

It has gained 1310% in the past one year as it is the major beneficiaries of the GST. It expects to sustain its strong growth momentum in 2015, driven by the launch of new cloud based solutions for SMEs and high growth from the China market.
Its official opines there is still huge potential for it to grow its recurring income as it launches its service as a Saas in June 2015. Saas allows smaller property companies to rent IFCA’s software.
SMEs can subscribe to its software services by paying a monthly subscription fee of rm4000 to rm5000 instead of forking out hundreds of thousands of ringgit upfront.

It is seeking to transfer to main market.

It posted a net profit of rm21.07 million for the financial year ended Dec 31 2014 from rm1.73 million in Fy2013 mainly due to the scalable nature of the software business. Revenue for FY2014 rose 71.59% to rm89.24 million from rm52 million.

It is Malaysia’s largest maker of cloud based software for property companies with around 80% market share of the domestic market. It serves major property developers including SP Setia, Mah Sing and EcoWorld.

With the implementation of the GST on April 1 2015, which forces smaller companies to computerize and upgrade their software believed it’s a very good time for IFCA to launch Saas.

The group will launch four Saas products in 2015, covering business accounting solutions for contracting business, standard operating procedures, marketing and contract management.

IFCA will not restrict itself to the property industry but will expand its services in the ICT, construction and engineering sectors.

For 2015, IFCA is also banking on growth from its China market.

It expects the China market to grow significantly in 2015, leveraging on its reputation and proven products. It accounted for 30% of the group’s revenue in FY2014.

IFCA’s clients in China include big names like the Wanda and R&F groups and Country garden Holdings Co Ltd. Other regional clients include Japan’s Mitsui Fudosan Co Ltd and Singapore’s CapitalLand Ltd.

Its Fy2104 recorded good results were not solely from GST software upgrade jobs, which only contributed 20% to its revenue in Fy2014. Its new software and cloud based products targeted at bigger property players like SP Setia, EcoWorld and Sunway Bhd had helped boost its profitability.

Currently (April 2015) institutional investors hold about 20% stake in the company.

As at Jan 23 2015, Yong holds a direct interest of 0.51% and an indirect stake of 42.48% in IFCA.

Going forward, IFCA has its contribution from China and it will still benefit from the migration from the Windows platform to a mobile based platform to a mobile based platform. Saas and its plan to transfer to the Main Market are the potential catalyst.

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