RHB initiates ‘buy’ on iFast on rising Asia-Pacific wealth management demand

[SINGAPORE] RHB has initiated a “buy” on iFast , given its view that the wealth management and digital banking firm is a “key beneficiary” of Asia-Pacific’s growing wealth management market.

The brokerage on Friday (Mar 27) set its target price at S$12.20, representing a 36.7 per cent increase from iFast’s closing price of S$8.94 a day earlier. The counter was trading 1.8 per cent or S$0.17 lower at S$9.05 as at 4.28 pm on Monday.

RHB analyst Syahril Hanafiah noted that iFast “sits at the centre of Asia-Pacific’s long-term structural wealth growth”. The region’s wealth management market, he noted, is set to reach US$41.8 trillion by 2031, from US$29.6 trillion in 2026.

Syahril also pointed out that the group’s asset-light model allows for incremental revenue with “relatively little additional cost” as assets under administration (AUA) increase.

RHB forecast that iFast’s profit before tax margin will rise to between 39 and 42 per cent from FY2026 to FY2028. AUA, meanwhile, is expected to rise at a three-year compound annual growth rate (CAGR) of 22 per cent.

The ePension division, which provides digital pension services, is also projected to drive iFast’s earnings growth.

The group “is responsible for building and operating” Hong Kong’s eMPF platform, a centralised electronic platform to standardise, streamline and automate administration of the city’s Mandatory Provident Fund.

The Hong Kong division is expected to generate profit before tax margins of 43 to 45 per cent from FY2026 to FY2028, “mainly due to higher contributions from the better-margin eMPF business”.

AUA-linked contributions, such as income generated from managing pension assets, are estimated to grow at a three-year CAGR of 42 per cent, supported by “steady growth from the wealth management platform” and contributions from the occupational retirement scheme ordinance segment.

Core earnings are expected to grow by 23, 18 and 15 per cent for FY2026, FY2027 and FY2028, respectively. Syahril said that this will be helped by “increasing operating leverage on scalability” of iFast’s wealth management platform and digital banking businesses.

The group reported a net profit of S$32.9 million for the fourth quarter of FY2025, marking a 70.4 per cent rise from S$13.6 million for the same period a year earlier.

Revenue rose 45.7 per cent year on year to S$151.7 million, fuelled by higher contributions from the ePension segment and banking operations, as well as stronger performance in its core wealth management platform. 

However, Syahril noted that iFast faces risks of earnings dependence on AUA, regulatory risks and exposure to foreign exchange currencies. 

Profitable digital banking arm

The group’s digital deposits in FY2025 came in at S$1.57 billion, up 55 per cent year on year. Syahril expects deposit growth at a three-year CAGR of 23 per cent, “supported by new customers and increased contributions from existing depositors”.

Revenue from iFast’s UK-based digital banking arm, iFast Global Bank, is also estimated to grow 28, 25 and 16 per cent in FY2026, FY2027 and FY2028, respectively, following its first profitable year in FY2025.

Syahril attributed iFast Global Bank’s expected revenue growth to a “growing deposit base amid stable net interest margins, (as well as) higher fee and commission income due to elevated transaction volumes”.

Positive macro environment

RHB also flagged the macroeconomic environment as a potential boost for iFast, with geopolitical and economic uncertainties “shaping investor allocation decisions” and Asia’s growth dynamics continuing to “attract both institutional and wealth capital into Singapore”.

“For a digital wealth management platform with this country as its primary operating hub, we think this macro environment provides a structural boost to iFast,” Syahril said.

“Sustained inflows into Singapore, whether driven by domestic savings or international capital reallocation, translate directly into a growing and increasingly profitable recurring revenue base,” he added.

Profit before tax for iFast’s Singapore division is therefore expected to grow at a CAGR of 21 per cent from FY2026 to FY2028.

In FY2025, the Singapore division’s AUA grew 27.9 per cent year on year, with net inflows reaching S$4.7 billion, up 43.3 per cent from a year earlier. Its business-to-business segment booked net inflow growth of 65.1 per cent, while its business-to-consumer segment’s inflows more than doubled.