ISDN Holdings - CGS-CIMB Research 2019-05-22: Be Part Of The Automation Revolution


ISDN Holdings - Be Part Of The Automation Revolution

  • ISDN is a motion control specialist with more than 30 years of industry experience.
  • Strong prospects for its core motion control business, its hydropower plants coming on stream and investment by Novo Tellus could catalyse its stock.
  • We initiate coverage on ISDN.

What ISDN does?

Established core business

  • ISDN HOLDINGS LIMITED (SGX:I07) is an engineering solutions company specialising in integrated precision engineering and industrial computing solutions. The company offers a wide range of engineering services, mainly to customers who are manufacturers and original design manufacturers of products and equipment that have specialised requirements in precision controls.
  • ISDN provides the full spectrum of engineering services from conceptualisation, design & development to prototyping, production, sales & marketing and after-sales engineering support.
  • ISDN was listed on the Mainboard of the SGX-ST on 24 Nov 2005 and subsequently listed on the Main Board of SEHK on 12 Jan 2017. 2017 marked the 30th anniversary of ISDN’s inception. ISDN’s success is primarily attributable to the relationship it has built with its suppliers over the years so that the group is able to recommend and offer its customers a variety of products as a solution to serve a wide range of engineering needs.
  • In addition to its core motion control, industrial computing and other specialised engineering solutions businesses, ISDN has diversified into renewable energy, primarily in developing hydropower plants in Indonesia, and resource mining and trading.
  • Headquartered in Singapore, ISDN operates through 76 subsidiaries with 65 sales offices across Mainland China, Hong Kong, Malaysia and a few other Asian countries, including Vietnam, Thailand, Taiwan and Indonesia as at 31 Dec 2018.
  • In China, ISDN owns an industrial base with a gross floor area of approximately 40,657 sq m in an industrial park in 江蘇省蘇州吳江區 (Wujiang district, Suzhou, Jiangsu province) where the group makes a certain range of products such as hinges and locks, precision gearboxes, and other industrial hardware for its other specialised engineering solutions by installing and assembling components and parts sourced.
  • As at 31 Dec 2018, ISDN had 856 employees, approximately 37% of whom were sales and engineering staff dedicated to working on solutions to satisfy its customers’ engineering needs.

Summary of analysis to be updated. Meanwhile, please refer to the attached 26-page PDF report for complete analysis.

William TNG CFA CGS-CIMB Research | Colin TAN CGS-CIMB Research | https://research.itradecimb.com/ 2019-05-22
SGX Stock Analyst Report BUY INITIATE NOT RATED 0.32 SAME 0.32