Lantrovision

Lantrovision: PhillipCapital initiates with a Trading Buy and TP of $0.685. House notes the two trends that Lantrovision rides on: 1) The need for globally standardised high quality structured cabling to avoid and quickly deal with critical systems failure; 2) Growth of Data Centres in Asia. Channel checks by PhillipCapital reveal that Lantrovision is “best in class” with an excellent track record on its regional presence. The Lantro Global Alliance Programme (LGAP) that the company has enables it to bid for global structured cabling contracts from the Fortune 500, a key competitive advantage given the increasingly global nature of contracts. Lantrovision has a strong cash position at 75% of equity with no debt. Excluding net cash, counter trades at just 3-4x fwd P/E, based on conservative earnings estimate for FY14F EPS of 4.9¢ (9MFY14 EPS: 4.0¢). We note that visibility have been increasing for the counter, with the recent initiation by UOB (Buy, TP $0.645) as well.