Insight Provider, CrossASEAN Research

Nicolas Van Broekhoven

Insight Provider

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Equity Bottom-Up

<a href="https://www.smartkarma.com/entities/isdn-holdings-ltd" target="_blank" rel="noopener" data-smartkarma-citation="entities:19907:1">Isdn Holdings (ISDN SP)</a> has been stuck in first gear failing to deliver any meaningful value for shareholders for the last five years. If we exclude its "amazing" stock explosion to 1.41 SGD/share in 2013 the period of non-performance stretches back a decade. Recall, the company came public at 0.29 SGD/share in May 2005 and was recently trading at 0.22 SGD. Since its IPO we have seen a revenue CAGR of 18.03% and NP CAGR of 16.12%. Over this time period, however, its shares outstanding have also more than doubled from 197.5M in 2005 to 429.57M in 2019.Has Mr. Market been wrong all this time? The <a href="https://links.sgx.com/FileOpen/ISDN-PR_27.02.2019_ENG.ashx?App=Announcement&amp;FileID=545378" target="_blank" rel="noopener">entry of Singapore PE firm Novo Tellus</a> certainly raises this question. Novo Tellus currently controls an 8.92% stake and is now the company's second-largest shareholder. ISDN over the years has told great stories about agro-tech, Emmett Capital, Renewables in Indonesia, etc. The time for delivery has come to settle once and for all if this is a company that warrants our attention.During last week's 3Q19 analyst briefing we heard from CEO Teo Cher Koon and Keith Toh, partner at Novo Tellus. In short, the story is that Novo Tellus will bring its operational excellence to the company and drive a shift towards software services. Software services carry high margins and could transform ISDN's erratic margin profile.Over the past few years betting against Novo Tellus has not been smart as demonstrated in the performance of <a href="https://www.smartkarma.com/entities/aem-holdings-ltd" target="_blank" rel="noopener" data-smartkarma-citation="entities:11019:1">AEM Holdings (AEM SP)</a> and <a href="https://www.smartkarma.com/entities/procurri-corporation-limited" target="_blank" rel="noopener" data-smartkarma-citation="entities:24110:1">Procurri Corporation (PROC SP)</a> recently.

Isdn Holdings (ISDN SP) has been stuck in first gear failing to deliver any meaningful value for shareholders for the last five years. If we exclude its "amazing" stock explosion to 1.41 SGD/share in 2013 the period of non-performance stretches back a decade. Recall, the company came public at 0.29 SGD/share in May 2005 and was recently trading at 0.22 SGD. Since its IPO we have seen a revenue CAGR of 18.03% and NP CAGR of 16.12%. Over this time period, however, its shares outstanding have also more than doubled from 197.5M in 2005 to 429.57M in 2019.Has Mr. Market been wrong all this time? The entry of Singapore PE firm Novo Tellus certainly raises this question. Novo Tellus currently controls an 8.92% stake and is now the company's second-largest shareholder. ISDN over the years has told great stories about agro-tech, Emmett Capital, Renewables in Indonesia, etc. The time for delivery has come to settle once and for all if this is a company that warrants our attention.During last week's 3Q19 analyst briefing we heard from CEO Teo Cher Koon and Keith Toh, partner at Novo Tellus. In short, the story is that Novo Tellus will bring its operational excellence to the company and drive a shift towards software services. Software services carry high margins and could transform ISDN's erratic margin profile.Over the past few years betting against Novo Tellus has not been smart as demonstrated in the performance of AEM Holdings (AEM SP) and Procurri Corporation (PROC SP) recently.

ISDN (ISDN SP): Stuck in First Gear Since 2005, Can Novo Tellus Get It to Full Speed?

France

Velcan develops and operates hydro power concessions in emerging markets.  The company has operations in India, Brazil, Laos and Indonesia.

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Velcan Holdings (ALVEL FP)

ISDN (ISDN SP): Stuck in First Gear Since 2005, Can Novo Tellus Get It to Full Speed?

Isdn Holdings (ISDN SP) has been stuck in first gear failing to deliver any meaningful value for shareholders for the last five years. If we...

Nicolas Van Broekhoven

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