KUALA LUMPUR (July 10): TA Securities has valued Daythree Digital Bhd (Daythree) at 42 sen and said this takes into account Daythree’s robust earnings growth prospects (FY23F/FY24F/FY25F: +45.9%/+31.9%/+29.6%) as it is positioned to benefit from the growing interest by businesses to pursue digital transformation, which includes the engagement of global business services (GBS).

In a note on Monday (July 10), the research house said that as of May 31, 2023, Daythree is engaged by 22 clients from various industry segments.

It said this includes the energy & utilities and telecommunications & media segments, which from FY19 to FY22 collectively accounted for 72% to 86% of the group’s revenue.

“As for the other segments served, they include fintech & financial services, construction, e-commerce & retail, healthtech, and travel & hospitality,” it said.

Going forward, TA Securities projects Daythree’s revenue and core net profit to grow at a three-year CAGR of 22% and 35.6% to RM118.3 million and RM17.4 million in FY25F.

“We view that Daythree as part of the GBS industry is poised to continue benefiting from the growing interest by businesses across various industry segments to pursue digital transformation, especially with the more rapid pace of digitalisation post pandemic.

“On top of improving efficiency, we view that businesses will also be keen on embracing the capabilities of technology (eg RPA, AI & machine learning, and data analytics & business intelligence) to unlock new opportunities and deliver added value to end-customers,” it said.

Daythree is tentatively slated to be listed on the ACE Market on July 26.

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