Silverlake Axis

Silverlake Axis: DMG maintains Buy with $0.71 TP. Note that Silverlake Axis (SLA) has recently announced a series of positive developments which include 1) a contract win to strengthen its order book, 2) a proposed acquisition to grow the company and 3) a placement of treasury shares to refill its M&A warchest. We adjusted our FY13F and FY14F earnings forecasts upwards by 5.3% and 4.5% respectively. In view of the robust earnings growth momentum and superior cash flow generating capabilities, house have chosen to use DCF to value the stock.