WILL THIS STOCK BE THE NEXT MQTECH ???

Hello to all readers out there. This week saw the rise of many TECHNOLOGY stocks.

Having said the above, the stock which I'd like to talk about today is INIX TECHNOLOGIES HOLDINGS BERHAD (INIX - Stock Code 0094, ACE Market, Technology - Software)

BASIC INFORMATION ABOUT INIX

INIX was founderd in 2013 with core businesses in a few fields:

i) Domains

ii) Hosting

iii) Servers

iv) IT Services

Market Capitalization : RM 19.39 million

Shares Float : 298.25 million

Website : http://www.inix.com.my/

1. SUPERB MAY QR 2020 NET PROFIT - TRADING AT LOW FORWARD PE RATIO OF 1.5X

Refer below latest summary of QR for INIX. As of latest quarter, INIX has managed to turn into net profit of RM 3 million compared to the previous 3 quarters of losses.

As recorded by the company, the net profit was contributed by share from its associates company.

With net earning EPS of 1c, this makes the company trading in very low PE Ratio, should the earnings be able to be consistent for 4 quarters, translating to EPS of 4c.

This means now INIX is only trading at Forward PE Ratio of 1.5X.

2. MOHD ANUAR BIN MOHD HANADZLAH - CHAIRMAN OF MQTECH CUM

EXECUTIVE DIRECTOR OF INIX

Recently, one penny stock that made an impressive rally was MQTECH, which rallied from 2.5c to a high of 7.5c today, which represents 300% gains !!! 

Upon further checking, we find out that the Chairman of MQTECH, also sits on INIX Board as Executive Director.

Therefore, with superb gains in MQTECH, he might also be able to be a big deal maker contributor for INIX.

3. TECHNICAL ANALYSIS - STRONG BREAKOUT ABOVE EMA365 WITH YEAR

HIGH VOLUME

Refer below the basic price and volume chart with key EMAs for INIX daily chart :

A few observations on the daily chart chart:

i. Refer Circle 1 & 2, INIX had recently hit a low in March 2020, however we see that trading volume is very thin at the bottom, indicating that only weak sellers exited

ii. Refer Circle 3 & 4, INIX managed to breakout the EMA365 at 5.5c with super high volume of trading. This indicates a very strong interest in this stock and that the stock could potentially test higher levels soon

iii. Resistances seen at 8c and 10c for further uptrend confirmation

4. CHEAPER ENTRY INTO INIX VIA INIX WARRANTS-A (INIX WA)

Following is the profile of INIX WARRANTS A (INIX WA), for traders looking at lower cost entry into this stock. A few comments:

i. Maturity is November 2020, hence another 5 months to go to expiry

ii. Premium of 84% is considered quite reasonable, with the amount of life left for this warrant

iii. Strike price of 10c, which is 3.5c from the latest mother shares closing price

iv. Potentially, price can break out above 3c and head towards 5c, if the mother shares are able to trade above 10c

CONCLUSION

Considering all the above, I opine that current price for INIX is attractive due to below:

i) Superb May 2020 QR, trading at low Forward PE Ratio of 1.5X

ii) Chairman of MQTECH which rallied superbly, is also ED of INIX

iii) Chart showing bullish breakout of EMA365 on the back of strong volume, heading towards next resitances 8c and 10c

LET’S SEE HOW THE SHARE PRICE MOVEMENT IN THE NEAR FUTURE FORBEARING ANY GOOD CORPORATE NEWS.

Disclaimer : The above opinion is never intended to be a BUY CALL whatsoever. I am sharing my observations ONLY based on fundamental; past history; current trading pattern; charts etc. Please make your own informed decision before buying this share or whatever share for that matter.

BURSAMASTER