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- Business model stickier than any adhesive. <\/strong>Infinity supplies consumable adhesives, primers and hardeners embedded in footwear production lines. Products must pass a dual-approval process by both global brands and OEMs<\/strong>, creating long qualification cycles, high switching costs and entrenched supplier mandates once approved.<\/li>\n<\/ul>\n\n\n\n
\n\n\n\nFY25 Snapshot<\/h2>\n\n\n\n
For the full-year, revenue and net profit\u00a0were\u00a0HK$835mn\u00a0and\u00a0HK$122mn respectively. The company\u2019s revenue has remained\u00a0stable across cycles, reflecting production-linked demand rather than discretionary retail.\u00a0Majority of Infinity\u2019s revenue (88%) comes from ASEAN, with 59% Vietnam, 15% Indonesia, 12% Bangladesh, 1% India. The remaining 12% comes from China.\u00a0Its balance sheet proves stable with net cash\u00a0of\u00a0HK$288.5mn\u00a0and\u00a0cash ~35% of total assets;\u00a0with\u00a0only lease-related liabilities outstanding.\u00a0For FY25, the company declared total dividends amounting to HK$0.205\u00a0per share, an increase from the HK$0.18 per share\u00a0in FY24.\u00a0<\/p>\n\n\n\n
\u00a0<\/div>\n\n\n\nStructural Industry Tailwinds, Though Near-Term Macro Conditions Have Softened<\/strong><\/h2>\n\n\n\n
The global footwear market is projected to grow from US$495bn in 2025 to approximately US$790bn by 2032, driven by emerging market consumption, sportswear penetration and lifestyle shifts. Rising labour costs, tariffs and supply-chain diversification continue to shift production from China into Vietnam and Indonesia, benefiting regionally embedded suppliers such as Infinity. Still, the ongoing Middle East conflict has raised near-term energy, freight and input costs, which may moderate factory activity across Asia even as the longer-term relocation trend remains intact.<\/p>\n\n\n\n
\u00a0<\/div>\n\n\n\nValuation & Action<\/h2>\n\n\n\n
Based on our discounted cash flow (DCF) valuation, we initiate coverage on Infinity Development Holdings with an OUTPERFORM<\/strong> rating and a target price of S$0.62.<\/strong> Our DCF-based valuation utilises employs a WACC of 8.03% and a blended terminal value approach, derived based on a 1.5% terminal growth rate and a forward P\/E multiple of 4.3x, reflecting a conservative risk assessment amid heightened macro uncertainty and near-term cost pressure across Asia.<\/p>\n\n\n\n
\u00a0<\/div>\n\n\n\nRisks<\/h2>\n\n\n\n
Customer concentration, OEM footwear production cyclicality, volatile raw material costs, currency and macroeconomic risks and Indonesia expansion execution.<\/p>\n\n\n\n
\u00a0<\/div>\n\n\n\n
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