TalkMed

TalkMed: CIMB initiates Coverage with an Add call and TP of $1.20. The house notes that an ageing population coupled with unhealthy and stressful lifestyles are resulting in higher incidences of cancer. Against this back drop, demand for TalkMed’s oncology services is set to grow as more patients seek early treatment. TalkMed is an established medical oncology and palliative care services provider. The house DCF-derived target price of $1.20 translates into a CY15 P/E of 21.4x, which is deem reasonable compared to Singapore’s healthcare sector average CY15 P/E of 27x. Entry barriers are high given the specialised domain knowledge, while the business is asset light. Dividend payout ratio target is 75%.