Starburst

Starburst: Initiation report by OCBC with a conviction Buy rating and TP of $0.39.

Starburst is an engineering solutions provider of firearms training facilities, and has established its track record in Southeast Asia since 1999 and more recently, in the Middle East. Typically, established track records are needed before these government bodies engage any contractor for defence-related works. In this case, Starburst has accumulated more than 15 years of experience in this niche industry.

With the rising threat of terrorism globally, though more evidently in the Middle East, Starburst is expected to benefit from the anticipated increase in defence spending over the next few years.

Post-listing on SGX in 2014, it has been able to secure more contracts from governments in the Middle East and expects this trend to sustain with more and bigger projects. With only a few key players in this niche industry, OCBC thinks Starburst is certainly undervalued at the current price level.