To signal its appreciation for shareholders, TeleChoice plans to pay a final dividend of 0.45 cent, up from just 0.125 cent paid for the preceding FY2024.
Specifically, revenue from the business of handling devices logistics for key customer U-Mobile jumped 42% y-o-y to $200 million, driven by the telco's growth in subscriber numbers and also higher postpaid plans. TeleChoice also increased outlets, widened the range of phones and introduced more accessories, notes Chew.
On the other hand, Telechoice got to make higher inventory provisions. Chew notes that there was a spike in inventory write-down or a $2.5 million increase to $3.8 million. "We believe it is a general inventory provisioning rather than actual obsolescence," he reasons.
According to Chew, the PCS segment will continue to be a key growth driver, riding on U Mobile's aim to increase market share with the rollout of its 5G network, which implies more business for TeleChoice.
Also, its network engineering services segment will see growth with new managed services in Indonesia and the installation of network equipment in Malaysia.
A third business segment, ICT, or info-communication technology, is "recovering" as TeleChoice goes after more projects in healthcare and financial services, he adds.
For the current FY2026, Chew has raised his patmi forecast by 13% to $8.3 million, and by applying the same 15x PE, in line with other SGX-listed proxies in the system integration and software sectors, derive the higher target price of 27.5 cents.
Down the road, the company is mulling further expansion into new, higher-growth segments within the digital infrastructure, including data centres, says Chew.
TeleChoice International shares changed hands at 19 cents as at 2pm, down 2.06%, but is up 137.5% in the past year.
