By: Intermarket Securities Limited
TPL Trakker Limited (TPL) held an analyst briefing last week. To recall, TPL posted NPAT of PkR202mn (EPS: PkR0.93) in FY15, up by 129%YoY (pre‐tax: +66%YoY) largely on capital gain of PkR144mn from stake disposal on TDIL coupled with 4%YoY revenue growth (Asset Tracking: +2%YoY; Container Tracking: +8%YoY).
Recent initiatives include Fuel monitoring, Live Camera, Personal tracking devices, and E‐ticketing solutions while upcoming projects/business lines include Navigation (TPL Maps trial version due in Oct’15), Container Tracking (potential increase in NATO demand) and TPL Rupiya (E‐payment solution). At the same time, associate TPL Properties is planning to go public this year (“Centre Point” has been 100% leased).
Despite muted sales growth in FY15, TPL has gained 103.5%CYTD/2.9%FYTD to trade at a trailing P/S of 2.4x (avg. P/S since listing: 1.38x) with the market evidently looking at (i) swift growth prospects and (ii) further gains as TPL Properties goes public. While anticipation of the latter may keep share price performance buoyant in the near‐term, we believe medium‐term justification of valuations will require revenue growth to quickly pick up.