Tiruchelvam says he expects the company’s cloud-based platform’s annual recurring revenue to grow at 25% per year at a 6.2% CAGR over FY2025 to FY2028. The analyst thinks the Mainboard-listed company is “likely” to generate $18 million in ebitda in FY2025 ending Dec 31.
Info-Tech reported earnings of $5.16 million for 1HFY2025, down 21% y-o-y.
Info-Tech, which listed on the Singapore Exchange in July, has built-in compliance features that drive strong retention and operating leverage, says Tiruchelvam. This means it is poised to capture Southeast Asia’s SME digitalisation wave, he adds. “There is a US$17.3 billion addressable market in HR and finance digitisation. Info-Tech is on the cusp of sustained earnings growth.”
Already, Info-Tech is scaling its geographic footprint across Malaysia, Hong Kong and India to capture SME-driven growth in digital transformation.
See also: Newly-listed Info-Tech reports lower earnings of $5.16 mil for 1HFY2025 due to one-off expenses
In Malaysia, onboarding is propelled by SME Digitalisation Grants. In Hong Kong, RegTech partnerships address cross-border compliance. In India, Info-Tech is engaging state-level fintech alliances to penetrate the fragmented SME landscape.
With a “buy” call on Info-Tech, Tiruchelvam values the company on a discounted cash flow model, leading to his target price of $1.17.
“We forecast the company to generate an ebitda margin of over 30% in FY2025 to FY2028. In FY2025, Info-Tech is projected to have a net cash position of $41 million on the back of its recent IPO. These proceeds would provide the fulcrum for its regional expansion,” he adds. “Info-Tech appears undervalued according to SaaS metrics like the Rule of 40, as well as comparative metrics.”
As at 9.55am, shares in Info-Tech are trading flat at 86 cents.
