PETALING JAYA: Infomina Bhd
’s medium-term prospects look brighter as geographical expansion and higher contribution from renewal contracts drive earnings growth, analysts say.
Two research houses have raised their earnings forecasts for Infomina following its results briefing for the first quarter ended Aug 31, 2026 (1Q27).
Kenanga Research lifted its net profit projections for the group’s financial year 2028 (FY28) by 13.7% to RM58mil.
This was underpinned by an 11% upward revision in revenue to RM411mil to factor in stronger contributions from Japan, Australia and New Zealand as the group progressively capitalises on its expanded mandate to distribute and support Broadcom’s mainframe software across 12 Asia Pacific markets.
It maintained its FY27 forecasts and an “outperform” rating on the stock, with a 26% higher target price of RM2.40 from RM1.90 previously. Kenanga Research rolled forward its valuation base to FY28 while retaining its target price-to-earnings ratio of 25 times.
“We see Japan, Australia and New Zealand as key earnings growth drivers over FY27 to FY28, with further upside from potential non-mainframe software distribution rights and growing contributions from artificial intelligence (AI), data and cybersecurity solutions.”
Kenanga Research said it conservatively estimates Japan revenue of RM20mil and RM30mil in FY27 and FY28, respectively, along with RM30mil from Australia and New Zealand in FY28, leaving room for upside should contract conversions exceed expectations.
Another significant growth opportunity lies in Infomina’s pursuit of additional distribution rights for Broadcom’s non-mainframe software portfolio across Asia Pacific, with management saying this addressable market could be comparable in size to its existing mainframe software opportunity.
“Infomina has already secured access to Broadcom’s automation and operations software portfolio in Japan, with further regional distribution arrangements under discussion,” the research house said.
It added that the broader product offering should enable the group to deepen penetration of its enterprise customer base, grow recurring software revenue, and improve customer wallet share.
Moreover, it pointed to Infomina’s further diversification beyond mainframe services, with AI and data formally established as its third business pillar and the acquisition of a 51% stake in Blue Fortress strengthening its cybersecurity capabilities, which presents cross-selling opportunities.
“We believe the combination of recurring renewal income, expanding regional operations and emerging AI and cybersecurity businesses should support sustainable earnings growth over the medium-term,” Kenanga Research said.
It added that the company’s earnings growth will increasingly depend on revenue mix, especially the higher-margin renewal business, which in 1Q27 accounted for 77% of group revenue.
AmInvestment Bank (AmInvest) Research noted that Infomina’s renewal income has grown at a 66% compound annual growth rate since FY21 and offers sticky revenues, as mainframes power critical functions and are expensive to replace, ensuring long-term contracts and steady renewals.
It also highlighted the group’s strong order book, which doubled year-on-year in 1Q27 to RM614mil and rose a further 9% quarter-on-quarter.
The research house said Infomina’s entry into Australia and New Zealand could provide potential annual revenue of RM50mil.
“Importantly, revenue conversion could be faster than in Japan. The group takes over support responsibilities when existing contracts expire. Contract tenures in Australia and New Zealand are three years versus eight years in Japan,” it said.
AmInvest Research has raised its FY28 and FY29 earnings estimates for the group by 17% and 22% to reflect higher renewal revenues from its expansion into Australia and New Zealand.
It has maintained a “buy” call on Infomina with a higher target price of RM2.25 from RM1.85, after rolling forward its valuation base year to FY28 based on an unchanged target price-to-earnings multiple of 24 times.
