Serial System

Serial System: unveiled last month its growth strategy following a major review. Serial currently supplies ~60% of the components per pdt per customer. It aims to raise this metric to 90%, by i) targeting growth areas such as the automotive and mobile industries, and ii) offering packaged solutions rather than standalone components. This should translate into higher margins and more revenue. On the back of these initiatives, Voyage raises its FY14e revenue growth forecast to 15% from 10%, and lifts its profit margin forecast to 1.8% from 1.5%. Accordingly, the house has a higher TP of $0.193 (from $0.18), and maintains its Overweight rating.