Excerpts from analysts' report
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NPAT surges 521.6% YoY to USD0.7m. Trek 2000 International Ltd (Trek) announced a solid 1Q15 with NPAT surging 521.6% YoY to USD0.7m, accompanied by 80% topline growth mainly driven by its interactive consumer solutions (ICS) division, which grew 91% QoQ amid increased sales of Flucard and Wifi memory modules. Licensing revenue also increased 56.1% QoQ to USD0.7m in 1Q15 as third-party licensing customers reported an improvement in sales. 
Trek CEO Henn Tan launching the FluCard in 2010.
Photo: Company Flucard the potential new industry norm. We expect Trek to continue to try to lower its cost of manufacturing the wireless Flucard, which is poised to replace the normal SD card as the industry norm, especially once the price differential between the two products narrows to just 10-20%.
Potential bright spark – automobile. We expect Trek to expand its Flucard Wifi module into the medical and automobile space. We understand that it is in talks with second-tier manufacturers in the automobile space, and will introduce its Wifi module at the factory level. We expect this segment to gain traction with a potentially positive outcome by the end of 1H15.
Maintain BUY with a SGD0.61 TP. With a positive outlook ahead, we reiterate our bullish stance and expect FY15 to be a phenomenal year for Trek, with rewards from its wireless Flucard kicking in. We expect approximately a 264% NPAT surge for FY15.
In addition, we continue to think that Trek could also be a potentially favourable acquisition target by its larger peers due to its database of valuable patents. Maintain BUY with a SGD0.61 TP, pegged to a 16x FY15 P/E, implying a 36% upside.
