That said, Delfi’s revenue declined 5.3% y-o-y in 1QFY2024, marking the first quarter of y-o-y decline since 1QFY2021. This is primarily due to the decision to reduce and refocus spending on trade promotions, which suggests a weaker outlook for the rest of FY2024, Tay notes. In its 1QFY2023, revenue and ebitda contributed larger shares at 29.6% and 34.2% of FY2023’s results respectively.
CGS International (CGSI) analyst Tay Wee Kuang has kept “add” on Delfi with a lower target price of $1.10 from $1.47 previously, expecting the company’s margins to start facing pressure in 2HFY2024.
In his June 3 note, Tay points out that Delfi benefitted from the stronger 1QFY2024 ended March with the Valentine’s Day gifting period as well as Lebaran earlier this year, resulting in its US$25.5 million ebitda, in line with CGSI’s estimates.
