Declout

Declout: Wholly-owned subsidiary Acclivis has been appointed as Microsoft's first partner in Asia to offer the Partner Hosted Productivity Cloud solution to Microsoft's customers. Acclivis will provide cloud services to the clients of Microsoft with the hosting of an enterprise grade Microsoft Software-as-a-Service solution. Acclivis will be progressively switching its cloud operating systems to Microsoft platforms for the partnership agreement, enabling the hosting solutions for customers using the Microsoft Productivity Suite consisting of Microsoft Exchange, Microsoft SharePoint and Microsoft Lync. This will provide organizations to offer its employees with efficient access to emails, calendars and contacts and knowledge sharing within the organization. Currently, Declout services corporates like Deutsche Bank and SIA, outsourcing clients include IBM and HP. Segment revenue growth has been decent at $15m – 18m in each of the past two years, which translates into growth of 96% and 41% in FY11-12, respectively. Declout's Vertical Domain Cloud platform, which focuses on the games segment – will be the growth catalyst. Group intends to create a games eco-system with online payment and community networks across SE Asian markets beginning with Singapore, Malaysia, Indonesia and Thailand. The platform will support both PC and mobile games. Initial launch expected to take place in 2H13 with full services expected by 2014. If successfully executed, DeClout could find a new beachhead into the SE Asian gaming market that is expected to grow to US$1b comprising 117m gamers by 2016 - according to Niko Partners, which specializes in Asian games market intelligence. At the last closing price of $0.22, Declout trades at a forward P/E of 17.5x. Declout has a 12-month consensus TP of $0.41, implying a whopping 86% upside.