Memtech

Memtech: Potential beneficiary of Tesla's watershed Model 3
- Following Tesla's watershed unveiling of its mass market electric car Model 3 last week, market watchers have been blown away by the significant demand, particularly from retail buyers, for the model.
- Memtech currently supplies US$30 to US$40 worth of components per car for all of Tesla's previous models (Roadster, S, X).
- With production of Model 3 expected to commence in late-2017, Memtech is likely to see a pickup in orders from FY18.
- Memtech is trading at an attractive 7.1x forward P/E relative to its 5-year historical average of 8.4x. Bloomberg consensus has 2 Buy and 1 Hold ratings with average TP of $0.82.