VENTURE CORPORATION LIMITED (SGX:V03)
Venture Corporation - Optimistic On The Long-Term Outlook
- We hosted an NDR for Venture on 23 Nov 2018.
- The company remains confident on its long-term prospects. Trade tariffs could prove to be positive for Venture.
- Meanwhile, the company has various experienced professionals to address the succession issue.
NDR
- We hosted an NDR for Venture on 23 Nov 2018 which was attended by 15 investors.
- At the NDR, Venture shared its optimism on the long-term outlook and that it maintained its determined focus to remain an outstanding partner to its customers.
- We maintain our ADD rating with Target Price of S$17.44 based on 12.3x FY20F P/E (0.5 s.d. below the 11-year average of 15.3x).
- Catalysts include stronger-than-expected customer orders while a key risk is delay in customer orders.
Innovating into the future
- Chairman and CEO, Mr. NL Wong, shared that he remains optimistic on the long-term growth outlook for the company.
- Venture will continue to go beyond operational excellence and has allocated resources to identify new business clusters/technology domains where it can add value and justify better margins.
Key takeaways from the NDR
- Venture thinks it will benefit from the current US-China trade tension but global manufacturing supply chains will take time to change.
- According to management, Venture generally tries to aim for a 6-10% net profit margin range. This, however, requires the whole corporation to work in tandem, in our view, and Venture would have to continuously add new differentiating capabilities.
- Venture has more than 50-60 key professionals in the company that are part of the team that is driving future growth for the company.
William TNG CFA
CGS-CIMB Research
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https://research.itradecimb.com/
2018-11-26
SGX Stock
Analyst Report
17.440
SAME
17.440
