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Although 1H26 revenue of $27.3mil is only 33% of RHTC’s $82mil for FY26F (1H25 was 40% of FY25), net profit at $9.7mil is 36% of RHTC’s $27mil for FY26F. We expect a stronger 2H26 based on a re-acceleration of order book growth in 1H26, retention metrics of over 90% for ITS’s core annual revenue upfront subscription HCM software (SaaS) and expected Academy corporate training momentum in 2H26.
Services revenue more than doubled to $4.9mil establishing Academy/AI corporate training as the second growth engine. This leverages a pool of government funding (SkillsFuture EC, 50-90% subsidy). Early-stage penetration implies long runway for margin-accretive growth.
Cash on the balance sheet improved from $67mil to $76.6mil (vs RHTC’s $93mil estimate for FY26F). Strong cash flow monetization remains on track. With zero borrowings and zero debt, this fully funds a projected 6.6% dividend in FY26F. Rule of 40 is projected to hit 90% (from 67%), signaling an increasingly efficient growth profile for a pure Asian SaaS play.
Strong GDP growth in ITS’s core market Singapore of 6.1% yoy in 1H and across the Causeway in ITS’s second main market Malaysia of an estimated 5%-6% support robust organic growth. We estimate organic expansion alone can increase revenue to $0.1bn over the medium term. Rule of 40 is projected to improve from 67% to 90%, signaling an increasingly efficient growth profile.
Significant valuation discount to SaaS peers, which have rallied 50%+ since our ITS initiation report on 4 May, and the broader market. ITS trades at 9.3x FY26F PE (5.9x ex-cash), 0.12x PEG and 4.4x EV/EBITDA vs global SaaS peers - Paycom, Paylocity and Workday – with an average of 12.5x EV/EBITDA and STI PEG of 1.55x. Longer-term re-rating potential exists as ITS scales into the enterprise segment. Based on our estimate FY26F Total Shareholder Return (TSR), ITS implied Intrinsic Value/Target Price comes to $2.00. We reiterate our BUY recommendation with potential 107% upside.
George KOH
Research Director
George.Koh@rhtgoc.com
Paul SCHYMYCK
Head of Research
Paul.Schymyck@rhtgoc.com
Mkt cap: S$250 mil
[$0.965 12Aug26]
Intrinsic Value: $2.00
52-week range: $0.76 – $1.16
Singapore
Software & Services [4510] FI. Source:
Important disclosures: see Appendix – Disclosures / Disclaimers
Source: Company data, RHTC estimates
EXECUTIVE SUMMARY
Revenue growth stayed strong
The main takeaway from the 1H FY2026 results was that revenue growth stayed strong at 22% yoy to $27.3mil and was broad-based. However, there was a revenue mix shift with a significant contribution from Services, which more than doubled (+116% yoy) to $4.9mil (17.9% of revenue) on the back of AI-related training through Info-Tech Academy — over 85% of Academy revenue in 1H FY2026 came from AI programmes. This mirrors the 183% full-year surge already seen in FY2025. ITS had already flagged that Academy/Services revenue is seasonally backloaded into 2H (as it was in 2HFY2025), so 1H is structurally the weaker half for Services. Cumulative Academy registrations exceed 23,000 at end 1H, up 5,000 or 28% from approximately 18,000 at end of FY2025.
Subscription order book up 14% to $30.4mil
Subscription, still the core (78% of revenue), grew a healthier 12% yoy to $21.2mil — an acceleration from FY2025's full-year 8% pace, indicating the core SaaS book also stayed healthy with customer retention metrics holding at over 90%. Active users expanded to 1.1mil users across 28,000 organisations, mainly SMEs in Singapore and Malaysia. The order book increased 14% yoy to $30.4mil in June 2026 keeping pace with the 14% growth in FY2025. The $30.4mil order book will be realised over the next 12 months indicating Subscription revenue should grow more robustly in 2H. This is excellent news given the earlier scare that AI could heavily disrupt the information technology and software sectors.
Margins Stable
Margins expanded, but reported figures for net profit and EPS of 89% yoy are inflated by opposite one-offs in 1H FY2026 and 1H FY2025. 1H FY2025 net profit of $5.1mil was depressed by $2.1mil of one-off IPO-listing and Malaysia office relocation expenses. 1H FY2026 net profit of $9.7mil was boosted by a $1.0mil one-off Enterprise Singapore GEMS grant. That combination is why reported net profit and EPS both jumped 89% yoy to $9.7mil and 3.75 cents respectively, but not an exact read on underlying performance. Stripping both distortions out, adjusted net profit grew 20% yoy to $8.7mil, and adjusted EBITDA grew 22% to $11.5mil — both roughly tracking revenue growth of 22%, implying margins were essentially stable on a like-for-like basis. We predict higher margins in 2H on the back of strong underlying momentum in Services.
Cash flow monetisation remains on track
Cash on the balance sheet improved from $67mil to $76.6mil (vs RHTC’s $93mil estimate for FY26F). Strong cash flow monetisation remains on track. With zero borrowings and zero debt, this fully funds a projected 6.6% dividend in FY26F while retaining capacity for continued Academy capacity investment and regional expansion (Malaysia, Hong Kong, India) without needing external funding, and share buybacks.
Rule of 40
At current growth trajectories in Singapore and Malaysia, we estimate organic expansion alone can support $0.1bn of revenue over the medium term. Rule of 40 is projected to improve from 67% to 90%, signalling an increasingly efficient growth profile for one of the few pure SaaS plays in Asia.
Dividend keeping pace
The interim dividend rose 8% from 1.55 cents to 1.68 cents tracking closely to the 20% growth in adjusted net profit. The payout ratio was set at 50% of adjusted net profit, roughly consistent with 1H FY2025's ~55% adjusted payout. Management appears to be sizing the dividend off the adjusted net profits base rather than the grant-boosted headline figure — a reasonable, conservative approach while signalling confidence for the rest of FY2026. RHTC is projecting a 6.6% dividend yield for FY2026.
Macro backdrop in Singapore favourable
The macro backdrop for ITS in its core Singapore market ($19.3mil or 71% of revenue and growth of 21% yoy) remains very supportive. On 11 August the Singapore Government sharply upgraded its 2026 full-year GDP growth forecast to 4.5%-5.5% (up from the previous range of 2%-4% and vs 5% in 2025). This major upward revision comes on the back of a strong 6.1% yoy growth in 1H 26 (6.3% in Q1 and 5.9% in 2Q) with growth being driven by the global AI capex boom. The robust GDP growth in 1H was reflected in strong employment growth of 9,400 in 1Q 26 (almost 4 times the 2,300 in 1Q 25) accelerating to 10,700 in 2Q 26 (also higher than the 10,400 in 2Q 25). This will also underpin revenue for ITS’s HRM SaaS business model in 2H which is based on employee numbers.
And in Malaysia
A similar story is happening across the Causeway in ITS’s second main market Malaysia ($6.2 mil or 22% of revenues and growth of 26% yoy in 1H). The official forecast for Malaysia’s 2026 GDP currently stands at 4%-5% but it appears on track to hit an improved growth of 5%-6% in 2026 (vs 5.2% in 2025) after 1Q growth of 5.4% yoy with Bank Negara governor Abdul Rasheed in July predicting growth will be at the top of the range. The upside for Subscription revenue in Malaysia remains substantial due to ITS’s low penetration rate vs Singapore. The market for AI training in Malaysia is also untapped.
Order book and retention metrics point to a stronger H2
On a clean, adjusted basis, this was a solid 1H FY2026 — ~20-22% growth across revenue, adjusted EBITDA, and adjusted net profit, with the core subscription business accelerating, a strong order book, and Academy/AI training now firmly established as the second growth engine. The 89% net profit/EPS headline is real cash to shareholders, but it's flattered by one-off items moving in the company's favour this time, after working against it a year ago.
Significant valuation discount to SaaS peers
Significant valuation discount to SaaS peers, which have rallied 50%+ since our ITS initiation report on 4 May, and the broader market. ITS trades at 9.3x FY26F PE (5.9x ex-cash), 0.12x PEG and 4.4x EV/EBITDA vs global SaaS peers - Paycom, Paylocity and Workday – with an average of 12.5x EV/EBITDA and STI PEG of 1.55x.
We reiterate our BUY recommendation
Longer-term re-rating potential exists as ITS scales into the enterprise segment. We estimate FY26F Total Shareholder Return (TSR) of approximately +105%, implying an Intrinsic Value/Target Price of $2.00. We reiterate our BUY recommendation with potential 107% upside.
Valuation Risks
Risks to RHT Capital views and intrinsic value/Target Price
1. Better/worse execution in pursuing new market shares that would pose an upside/downside risk to our estimates and valuation.
2. Faster/slower-than-expected organic growth would pose an upside/downside risk to our estimates and valuation.
3. A better/worse-than-expected macro/trade environment that may provide upside/downside risk to growth across business lines.
Valuation Method and Risk Statement
Investing in the technology sector entails above-average risk given low sales visibility, rapid pace of innovation and technological change, intense competition, frequent M&A, and low barriers to entry in many markets
ITS Target Price based on 2026E PEG and EV/EBITDA. Risks include macroeconomic environment, competition [incumbent SaaS], growth initiative traction, and potential float income contraction.
Growth would be curtailed by a slowdown in employment on the SaaS portfolio given ITS’ employee-based PEPM pricing model and the general HCM market’s exposure to macroeconomic conditions. Additionally, larger HCM providers could become more competitive down market and constrain ITS’ growth
Intrinsic Value is based on 2026E forecasts. We view the derived intrinsic value/target price as fair given macroeconomic and geopolitical uncertainty, which could potentially fuel further downward estimate revisions.
Our Intrinsic Value/Target Price is based on Total Shareholder Return framework with 1-year holding period premised on our FY26 estimates.
Risks
- Greater than expected public sector tailwind
- Macroeconomic environment
- Reliance on government grants
- SME cyclicality
- Data security exposure
Appendix
A-1 SWOT Analysis
| SWOTs | Description |
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| Strengths |
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| Weaknesses |
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| Opportunities |
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A-2 Disclosures/Disclaimers
This report is issued and distributed by RHT Capital Pte Ltd (“RHTC”). RHTC is a capital markets services licensee under the Securities and Futures Act 2001. Accordingly, it is exempted from the requirement to hold a financial adviser’s licence under the Financial Advisers Act, 2001.
This report is prepared for general circulation and for information purposes only and under no circumstances should it be considered or intended as an offer or a solicitation to deal in the securities of the company(ies) referred to herein. This report is not intended to provide personal investment advice and does not take into account the specific investment objectives, the financial situation and the particular needs of persons who may receive or read this report. Investor should independently evaluate the particular investment and seek advice from a professional financial adviser regarding the suitability of investing in any securities recommended in this report, taking into account the specific investment objectives, financial situation or particular needs, before the investor makes a commitment to buy or sell the investment product.
This report is not directed to, or intended for distribution to or use by, any person or entity in any country or jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation, or which would subject RHTC to any registration or licensing or other requirement, or penalty for contravention of such requirements within such jurisdiction.
This report is proprietary and may not be reproduced, transmitted to, copied or distributed to any other party in whole or in part in any form or manner without prior written consent of RHTC.
The information in this report has been obtained or derived from sources believed to be reliable, but RHTC has not conducted due diligence on any of the company(ies), or independently verified any information or sources. Accordingly, RHTC does not make any representation or warranty as to the accuracy, completeness or correctness of the information set out in this report.
While reasonable care has been taken to ensure statements of facts made in this report are accurate, this report may include forward-looking statements based on assumptions and information currently available and are subject to risks and uncertainties that could cause actual results to differ materially. Such statements are not guarantees of future performance, and readers should not place undue reliance on them. RHTC assumes no obligation to update or revise these statements after issuance of this report. Accordingly, RHTC accepts no liability whatsoever for any consequences arising from reliance on or use of this report, including, without limitation, any direct, indirect, or consequential losses or damages.
RHTC, its affiliates and related corporations, their directors, associates, connected parties and/or employees may own or have positions in the securities of the company(ies) covered in the report and may from time to time add to or dispose of, or may be materially interested in, any such securities. Further, RHTC, its affiliates and its related corporations may from time to time perform services for or solicit business from any company(ies) mentioned in this report.
As at the date of this report, RHTC does not have a proprietary position in Info-Tech Systems Ltd.
As at the date of this report, RHTC has no ongoing relationship with the Info-Tech Systems Ltd. within the past 12 months.
Analyst Declaration
The analyst(s) who prepared this report certifies that the opinions contained herein accurately reflect his or her personal views about the securities of the company(ies), and that he or she has taken reasonable care to maintain independence and objectivity in respect of the opinions herein.
The analyst(s) also certifies that no part of his or her compensation was, is, or will be directly or indirectly related to the specific recommendations or views contained in this report.
The analyst(s) confirms that he/she or his/her associate does not serve on the board or in trustee positions of the company(ies) and does not have financial interests in relation to the company(ies) mentioned in this report.