KUALA LUMPUR (June 11): Hong Leong Investment Bank (HLIB) said Infoline Tec Group Bhd (KL:INFOTEC) is poised to capitalise on the anticipated growing demand for IT infrastructure and cyber security solutions.

In a technical tracker on Tuesday, the research house said the cyber security segment is poised to be the main growth driver for FY2024.

HLIB said a key factor boosting demand for cyber security solutions is the impending gazettement of Malaysia's cyber security bill.

The research house said Infoline’s IT infrastructure sales is expected to record steady growth in FY2024, driven by strong order flows from both existing and new customers.

“For uninitiated, Infoline’s IT infrastructure sales are primarily driven by several key factors: (i) the expansion and upgrade of IT infrastructure for existing customers, (ii) the onboarding of new customers, and (iii) tech refreshes for existing customers.

“Recent discussions with management indicates that Infoline has secured several new local and multinational companies, who are currently undergoing IT infrastructure deployment,” it said.

HLIB said these new clients have outdated IT systems, making them a significant growth driver for FY2024.

Moreover, it said the increasing sophistication of IT infrastructure has shortened the tech refresh cycle and increased the value of each project, presenting Infoline with more contract opportunities in the long run.

“Infoline is currently trading within its support range of 76 sen to 79 sen, with indicators showing an uptick bias.

“A successful breakout above 83 sen hurdle will spur the share price toward 88 sen-90 sen-92 sen levels. Cut loss at 73 sen,” it said.