Smartflex

Smartflex: Said on Wed that it will partner a leading global smart card manufacturer to launch their eco SIM product in India. According to mgt, their customer is the third largest mobile operator in India, hence UOBK believes the company could be Idea Cellular, an Aditla Birya Group company. This partnership will allow Smartflex to access Idea's customer base of ~130m subscribers and 16% share in India, a smart card market that has been growing at a rate of 10-12% CAGR over the past few yrs . IN fact, Idea's yearly smart card demand is ~200m-300m modules, and UOBKS predicts this demand could gradually shift contract orders to Smartflex, as its ecoSIM cards are priced at least 10% below competitors. At an estimated US$0.12 per module, this would translate to over US$3m in savings for Idea each year. Meanwile, Smartflex's target of 50m units in India by 2016 seems achievable UOBK maintains Buy on Smartflex with TP $0.21, valuing the stock at 1.3x P/B (30% discount to peers)