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Malaysia is launching on e-invoice test run on the month of May 2024, while the 1st batch of compulsory participating company with annual revenue above rm 100 million will go live on August 2024.
So while the trend is going to be picked up soon, let me show you some of the listed company that are involved in e-invoice/ pos system / erp system.
Here is 4 commonly known listed player in KLSE
1. ADB - 0276
2. CENSOF - 5195
3. IFCAMSC - 0023
4. PANDA - 0290
ADB and PANDA is the 2 companies that went IPO within the past 12 months period.
1. ADB
ADB annual revenue is around RM 40 million, with net profit at rm 12 to RM 13 million region
Market capitalization for ADB is RM 522 million with share price at 95 cents region
2. CENSOF
Censof got 2 types of customers. Government and commercial. On the commercial side of business, Censof software sales is around RM 25 million (Since e-invoice is only for commercial business)
The profit for the commercial customer is around RM 7 million annually on average.
3. IFCAMSC
IFCAMSC got the higher revenue compared to all the other, averaging RM 75 million for it's software services. However, it lacks on net profit margin, with the latest 4 quarter net profit at just RM 2.6 million. IFCAMSC can go further if they embark on internal operating cost restructuring.
Market cap is RM 200 million at the current share price.
4. PANDA
Panda annual revenue is around RM 23 million, with net profit at RM 4.3 million range. The market cap for PANDA is now at RM 208 million. The share price has seen a good run forward in the midst of implementation of e-invoice.
TARGET INVEST OPINION
In my opinion, CENSOF and PANDA commercial customer revenue base is very comparable, which is sitting at the range of RM 25 million. However, looking at the valuation, PANDA is currently valued at RM 200 million while CENSOF is just RM 140 million. That is not including the government side of business profit that CENSOF is bringing in to the shareholder.
Should CENSOF trade towards RM 200 million market cap valuation, CENSOF share price will be trading at RM 0.36 per share.
Current share price (RM 0.25) of CENSOF is 30% below valuation for peer to peer comparison on commercial SME customer base. Adding in government revenue and profit will bring CENSOF value more than RM 300 million.
What do you think of the 4 selections? Which one is undervalue?
IMPORTANT NOTICE
Please be informed that I am not a professional or certified analyst. I am not a licensed consultant, just a normal retail investor. I am just sharing my ideas and opinion on the market outlook. Any company mentioned should not be interpreted as a buy/sell/trade call. Please do your own research and buy/sell/trade at your own risk.
