VENTURE CORPORATION LIMITED (SGX:V03)
Venture Corporation - Future Ready
Sustainability drives economic growth
- Venture Corp (SGX:V03) is exposed to governance (e.g. conflict of interest, customer confidentiality), labour and environmental risks through its business in the electronics manufacturing supply chain. Venture Corp believes in order to be “Future Ready”, sustainability is core in driving long-term economic growth.
- Maintain HOLD on Venture Corp and Target Price of SGD18.46 (2x FY21E P/B).
- We prefer Frencken Group (SGX:E28) (BUY, Target Price SGD1.33, see report: Frencken Group - Maybank Kim Eng 2020-08-19: Continued Resilience.) due to more attractive valuations, and higher probability for earnings resilience, in our view.
Strong execution and satisfied customers
- Venture Corp has policies to manage key governance risks that include corruption, conflicts of interest and customer confidentiality.
- In 2019, Venture Corp had:
- zero public cases regarding corruption/ termination of business relationships due to corruption; and
- zero incidents of breach of customer privacy and loss of customer data.
- Moreover, Venture Corp has a robust track record of service excellence, and has been frequently recognized as a preferred supplier by many customers.
Anti-labour exploitation and conflict minerals
- As Venture Corp relies on a significant number of migrant workers, it faces risks of worker exploitation by third-party suppliers. Venture Corp has processes in place, such as conducting audits with its recruitment service providers to ensure recruitment complies with all local regulations.
- Venture Corp is also exposed to risks of conflict minerals in its supply chains. Its anti-conflict mineral policy includes mandating suppliers fulfil due diligence to ensure minerals are not sourced from conflict areas.
Environmental exposure
- Venture Corp’s environmental exposure is mainly through power, water and materials. Venture Corp’s manufacturing sites are ISO 14001 Environment Management System certified, and it has committees to ensure each site’s compliance with laws and regulations. Venture Corp also complies with the Restriction of Hazardous Substances (RoHS) directive, and uses RoHS- certified equipment. In 2019, there were no significant fines or non-monetary sanctions related to environmental laws.
- See Venture Corp Share Price; Venture Corp Target Price; Venture Corp Analyst Reports; Venture Corp Dividend History; Venture Corp Announcements; Venture Corp Latest News.
Gene Lih Lai CFA
Maybank Kim Eng Research
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https://www.maybank-ke.com.sg/
2020-09-29
SGX Stock
Analyst Report
18.46
SAME
18.46
