CGS-CIMB Research Securities is maintaining its “add” call and target price of $1.53 on Credit Bureau Asia (CBA).
This is believed to give the counter a 17.5% upside from its current $1.30 price, analysts Andrea Choong and Darren Ong write in an Aug 2 note.
Their move follows the credit and risk information solutions provider’s announcement of a joint venture with FiinGroup JSC.
As part of this, the company will provide analytics and data solutions to financial institutions, credit granting agencies, payment services agencies and other data companies in Vietnam.
See: Credit Bureau Asia to provide analytics and data solutions services in Vietnam with FiinGroup
CBA’s expansion into Vietnam “continues its streak of establishing new opportunities,” say Choong and Ong.
The company was, in June, designated as the new operator of the Moneylenders Credit Bureau (MLCB), a central repository of data on borrowers’ loans and repayment records with all licensed moneylenders in Singapore.
CBA hopes to incorporate these data points into its broader financial institution data business to create cross-selling opportunities, notes Choong and Ong.
For now, the duo estimate revenue contributions from MLCB to be relatively small.
Meanwhile, the group’s operations in Myanmar remain sluggish, following its launch in 1Q2021. So far, 30 financial institutions have signed up as members, but their on boarding process has been disrupted by the political instability there.
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Going forward Choong and Ong expect CBA’s PATMI (profits after taxes minus interest) to come in at $4.7 million in 1H2021 ended June.
This is up 17% y-o-y (on PATMI adjusted for listing expenses), and is supported by sustained volumes of bulk risk reviews and a pickup in new credit applications, the analysts explain.
The group’s results are expected after trading hours on Aug 5.
Shares in CBA closed flat at $1.35 on Aug 3.
