Fintech player iFAST set to gain further speed, says DBS

Wealth management fintech player iFast Corp. still has room to run despite posting a seventh straight quarter of record assets under administration (AUA), DBS said.

AUA rose 24.8 percent on-year to S$8.07 billion at the end of the first quarter, DBS said in a note last week.

“There is still room for growth as the current AUA level remains small relative to the size of the wealth management industry in Singapore
and the other Asian markets it operates in,” it said.

iFAST’s first-quarter revenue rose 40.1 percent to S$31 million, while net profit jumped 53.6 percent to S$2.7 million, the note said, adding it was mainly due to the AUA rise for both business-to-business and business-to-consumer in the period, benefitting from new customer investment inflows.

The Singapore market contributed to the most to the fintech player’s revenue, while its China operations were still losing money, the report said.

“China business still remains in the early stages of building the iFAST brand among potential clients and investment practitioners in China’s wealth management industry,” the report said.

But overall, the company’s “scalable” business model will allow it to scale up “without a proportionate increase in cost once it reaches a substantial scale,” DBS said.

It kept a buy call with a S$1.26 price target.

But it also pointed to a couple risks, including that the securities and financial services industry is highly regulated and that iFast’s operations can be vulnerable to market sentiment.

The stock was up 0.57 percent at S$0.885 at 2:08 P.M. SGT.