Monday, June 19, 2017

Advancecon HOlding Berhad

IPO (Rating  2.25 star out of 5.0)
Copyright@http://lchipo.blogspot.com/

Date
Open to apply: 19/06/2017
Close to apply: 28/06/2017
Listing date: 10/07/2017

Share Capital
Market Cap: RM253.310 mil
Public Issue: 90 mil shares (Open to public:30 mil shares)
Enlarged Issued Shares: 402.079 mil shares

Business (Construction)
Earthwork (64.2%) & Civil Enginnering (35.8%)

Major Customer
Ecoworld: 28.8%
Tropicana Group: 17.2%
Sp Setia: 13.6%

Remaining Order Book
2017: RM123.76 mil
2018: RM105.78 mil
2019: RM342.94 mil

Fundamental
Market: Main Market
Price: RM0.63
EPS: RM0.0658
P/E: 9.57
Cash & fixed deposit after IPO: RM0.087 per shares
NA after IPO: RM0.26
Debt ratio after IPO: 0.53 (Debt: 177.767 mil, Non-Current Asset: 165.864 mil, Current asset: 170.424 mil)
Dividend policy: 20% from PAT
ROE: 16.68%

Financial 
Trade Receivable: 122 days
Trade payable: 73 days
Credit for customer: RM 1.582 mil (1.2% from total trade receivable) not collected after 150days

Past Financial Proformance (Revenue)
2016: RM234.668 mil (eps: 0.0658)
2015: RM264.307 mil (eps: 0.0745)
2014: RM199.809 mil (eps: 0.0533)

Net Profit Margin
2016: 11.3%
2015: 11.3%
2014: 10.7%

After IPO Sharesholding
Dato'Phum: 23.7%
Lim Swee Chai: 12.7%
Pham Soon Kok: 7.3%
other 7 major sharesholder total: 25.9%

Director Remuneration (from gross profit 2016)
Yeoh Chong Keat: RM101k-150k
Dato'Phum: RM1.2mil-1.25mil
Lim Swee Chai: RM1mil-1.05mil
Ir. Yeo An Thai: RM700k-750k
Tung Kai Hung: RM450k-500k
Mohd Zaky bin Othman: RM50k-100k
Fathi Ridzuan bin Ahmad Fauzi: RM50k-100k
Total director remuneration from gross profit: 5.5% - 6.1%

Use of fund
Capital Expenditure: 52.4%
Repayment borrowing: 22%
Working Capital: 18.9%
Listing Expenses: 6.7%

Conclusion
Good thing is:
1. PE9.57, ROE16.68% is attractive, debt ratio is healthy.
2. Bad debt is minimum.
3. Have clear dividend direction.

The bad things:
1. Order book 2017 remain RM123.76mil, Unable to allocate the sale within January to 19/05/2017. Is important because 2016 revenue is 234mil, but 2017 order book 123mil. Revenue from January to 19/05/2017 will decide the company performance & price level.
2. Director revenue is consider high.
3. 22% IPO fund use to pay debt.
4. 59.6% revenue depend on 3 major customer.

Conclusions
It is a average IPO. It highly depend on the contract they receive for the company revenue growth.

IPO Price: RM0.63
Good time: RM0.85 (PE13)
Bad time: RM0.46 (PE7)

Company website: www.advancecon.com.my/

Friday, June 16, 2017

Lotte Chemical Titan HOlding Berhad

IPO (Rating 3.0 star out of 5.0)
Copyright@http://lchipo.blogspot.com/

Date
Open to apply: 16/06/2017
Close to apply: 28/06/2017
Listing date: 11/07/2017

Share Capital
Market Cap: RM7.970 bil
Public Issue: 740.483 mil shares (IPO: 55.783 mil)
Enlarged Issued Shares: 2.468 bil shares

Business
Polypropylene (23.1%), Polyethylene Msia (34.9%), Polyethylene Indo (21.7%)

Geo Revenue
M'sia: 38.7%
Indonesia: 28.5%
China: 11.3%
Southeast Asia: 9.7%
Others: 11.8%

Major Customer
2016: top ten customer contribute revenue 23%

Fundamental
Market: Main Market
Price: RM8.00
EPS: RM0.53 (use total shares after IPO, in prospectus is RM0.7613 is before IPO)
P/E: 15
Cash & fixed deposit after IPO: RM0.42 per shares
NA after IPO: RM6.12
Debt ratio after IPO:  0.091 (Debt: 1.371 bil, Non-Current Asset: 11.749 bil, Current asset: 3.361 bil)
Dividend policy: 50% from nett profit
ROE: Before IPO 16.5%, after IPO 9.6%

Financial 
Trade Receivable: 30-60 days
Trade payable: 25.5 days
Bad Debt: RM1.7mil (0.4% from total trade receivable) not collected after 90days

Past Financial Proformance (Revenue)
2016: RM8.136 bil (eps: 0.7613)
2015: RM8.147 bil (eps: 0.3549)
2014: RM8.611 bil (eps: -0.0111)

Net Profit Margin
2016: 16.2%
2015: 7.5%
2014: 0.2%

After IPO Sharesholding
Lotte Chimecal Corporation: 67.8%

Director Remuneration (from gross profit 2016)
Tan Sri Dato' Abdul Rahman bin Mamat: RM250k-RM300k
Lee Dong Woo: RM950k-RM1mil
Lee Kwan Ho: RM1.15mil-RM1.2mil
Tan Sri Datuk (Dr.) Rafiah: RM150k-RM200k
Ang Ah Leck: RM150k-RM200k
Total director remuneration from gross profit:0.13% - 0.15%

Use of fund
Funding for project: 97.42% (5.771 bil)
Lising expenses: 2.58%

Conclusion
Good thing is:
1. Fundamental of company is strong.
2. Have very minimum debt compare asset.
3. Trade receivable & payable is in healthy level.
4. Director fee consider acceptable.
5. 97.42% of IPO fund use to expand bunisess.

The bad things:
1. Revenue doesn't growth for past 3 year, the EPS growth mainly from cost deduction.
2. Board of director have very minimum of shares in the company. Company shares price perform or not doesn't have much effect to director.
3. Profit margin increase mainly from low crude oil price. In case crude oil price increase the company cost is expected to increase.
4. PE15 is consider near to country PE. Consider as fair but not discount.
5. PE almost near to main competitor PCHEM. ROE% is PCHEM slighty better.

Conclusions
Is above average IPO.  heavy expand using the IPO fund will see return after 3 years. Good for investment period more than 3 years.

IPO Price: RM8.00
Good time: RM9.01 (PE17)
Bad time: RM5.30 (PE10)

Company website: http://www.lottechem.my/

Saturday, May 6, 2017

Inta Bina Group Berhad

IPO (Rating 2.75 star out of 5.0)
Copyright@http://lchipo.blogspot.com/

Date
Open to apply: 05/05/2017
Close to apply: 15/05/2017
Listing date: 25/05/2017

Share Capital
Market Cap: RM133.814 mil
Public Issue: 107.051 mil shares
Enlarged Issued Shares: 525.259 mil shares

Core Business & Geo
Business: Construction Industry, General civil engineering, building general works
Geo : Klang Valley 83.27%, Johor 17.5%

Major Customer
2017: Mitraland (38.69%), Ecoworld (27.44%)
2016: UEM Sunrise BHD, Tropicana Corp BHD, Ecoworld, Plenitude BHD.

Fundamental
Market: Ace Market
Price: RM0.25
EPS: RM0.0238
P/E: 10.5
Cash & fixed deposit after IPO: RM0.074 per shares
NA after IPO: RM0.15
Debt ratio after IPO:  0.65 (Debt: 150.822 mil, Non-Current Asset:68.712 mil, Current asset: 161.068mil)
Dividend policy: nil
ROE: 16.1%

Order Book (RM445.907)
2019: RM48 mil
2018: RM171 mil
2017: RM226 mil

Financial 
Trade Receivable: 97 days
Trade payable: 74 days
Cashfow: -9.680mil (2014), -9.625mil (2015), 0.730mil (2016)

Past Financial Proformance (Revenue)
2016: RM257 mil (eps: 0.0238)
2015: RM271 mil (eps: 0.0215)
2014: RM245 mil (eps: 0.0198)

Net Profit Margin
2016: 4.95%
2015: 4.23%
2014: 4.31%

After IPO Sharesholding
Lim Pang Kiam: 0.37%
Lim Ooi Joo: 33.88%
Teo Hock Choon: 8.8%
Ahmad Bin Awi: 12.68%
Chau Yik Mun: 2.41%
Yap Yoon Kong: 4.52%
Dato' Sia Thian Sang: 0.37%

Director Remuneration (from gross profit 2016)
Lim Pang Kiam: RM0-50k
Lim Ooi Joo: RM450k-500k
Teo Hock Choon: RM400k-450k
Ahmad Bin Awi: RM100k-150k
Chau Yik Mun: RM350k-400k
Yap Yoon Kong: RM0-50k
Dato' Sia Thian Sang: RM0-50k
Total director remuneration from gross profit: 10.22% - 12.97%

Use of fund
Capital Expenditure: 18.68%
Repayment bank borrowing: 33.63%
Working Capital: 35.73%
Listing Expenses: 11.96%

Conclusion
Good thing is:
1. PE is around 10, Debt is healthy, ROE more than 15%.
2. Average Trade receiveable able to maintain less than 100 days.
3. 3 years PAT showing it qualified for main board.

The bad things:
1. No clear dividend policy
2. Director remuneration is expensis
3. USE IPO fund pay debt, 33.62

Conclusions
Is a normal IPO. The interesting part is that they qualified to IPO in market, but now IPO in Ace market.

IPO Price: RM0.25
Good time: RM0.35 (PE15)
Bad time: RM0.17 (PE7) 

Monday, May 1, 2017

Cabnet Holding Berhad

IPO (Rating 3.0 star out of 5.0)
Copyright@http://lchipo.blogspot.com/

Date
Open to apply: 28/04/2017
Close to apply: 08/05/2017
Listing date: 22/05/2017

Share Capital
Market Cap: RM72.8 mil
Public Issue: 21 mil shares
Enlarged Issued Shares: 130 mil shares

Core Business
Structured Cabling Work: 19.94%
ELV system: 59.43%
IT services: 24.48%
*will have 103%, 3% is consolidate adjustment

Revenue
Malaysia: 99.99%
Indonesia: 0.01%

Major Customer
Daiman Landmark Hotel Sdn Bhd: 0.02%
Kimlun Sdn Bhd: 11.67%

Fundamental
Market: Ace Market
Price: RM0.56
EPS: RM0.0493 (Based on total shares after IPO 130mil shares, instead of acct record 105.888 mil shares)
P/E: 11.35
Cash & fixed deposit after IPO: RM0.108 per shares
NA after IPO: RM0.28
Debt ratio after IPO: 0.229 (Debt: 10.777 mil, Asset:47.130 mil, Current asset: 41.525 mil)
Dividend policy: 30% of PAT
ROE: 17.63% (2016)

Financial
Receivable within credit period: RM10.817 mil
Receivable exceed credit preiod: RM1.397 mil
Trade payable with credit period: RM4.972 mil
Trade payable exceed credit period: RM2.22 mil

Past Financial Proformance (Revenue)
2016: RM 50.844 mil (eps: 0.0605)
2015: RM39.591 mil (eps: 0.00598)
2014: RM34.065 mil (eps: 0.0412)

Net Profit Margin
2016: 12.85%
2015: 14.78%
2014: 12.61%

After IPO Sharesholding
Datuk Tan Kok Hong: 0.19%
Tay Hong Sing (co-founder): 25.08%
Tan Boon Siang (co-founder): 25.08%
Lim Ming Koo: 0.12%
Loo Yong Peng: 0.12%

Director Remuneration (from gross profit 2016)
Datuk Tan Kok Hong: RM0-50k
Tay Hong Sing: RM250k-300k
Tan Boon Siang: RM250k-300k
Lim Ming Koo: RM0-50k
Loo Yong Peng: RM0-50k
Total director remuneration from gross profit: 4.1% - 6.15%

Use of fund
Working Capital -Purchase of equipment for projects: 44.7%
R&D expenditure: 4.3%
Repayment of bank borrowing: 25.5%
Listing expenses: 25.5%

Conclusion
Good thing is:
1. PE still below our country PE16.5
2. Debt ratio after IPO consider healty.
3. Have clear dividend policy.
4. ROE is 17.63% is good.
5. Past 3 year revenue continue to grow.
6. Only have 21 mil shares is market (easy to push during first day).
7. Co-founder still remain in the company.

The bad things:
1. Director fee is expensive. More than 3% from the gross profit, however 300k for director is not high, only can say revenue low & cost is high.
2. IPO fund 25.5% pay debt, 25.5% pay to broker for listing expenses. Total of 51% IPO fund use for non-encourage business growth usesage.Too sad for lisiting expenses in % is too high.
3. Lisiting in ACE market.

Conclusions
It can consider above average IPO.

IPO Price: RM0.56
Good time: RM0.73 (PE15)
Bad time: RM0.39 (PE8) 

Friday, March 31, 2017

Eversafe Rubber Berhad

IPO (Rating 2.75 star out of 5.0)
Copyright@http://lchipo.blogspot.com/

Date
Open to apply: 31/03/2017
Close to apply: 10/04/2017
Listing date: 21/04/2017

Core Business
Business: Masterbatch, Manufacturing of Tyre retreaders, rubber material traders, rubber works.

Revenue (260 Customer)
MasterBatch:89.3% (Pre-cured tread liner, camelback & others)
Local: 45% (2015: 22% of local market shares), 2016 (43%)
Export (23 countries): 55% (2015), 57% (2016)

Major Customer
Kohshin Retread (Japan): 9.346mil (17%)

Fundamental
Market: Ace Market
Price: RM0.36 (Promoter & director average cost per shares: RM0.25)
EPS: RM0.031 (9mths, 1yr forecast 0.041)
P/E:  8.78 (based on forecast eps 1yr 0.041)
Cash & fixed deposit after IPO: RM0.0515 per shares
NA after IPO: RM0.28
Debt ratio after IPO: 0.27 (Debt: 25.431mil, Asset:92.952mil, Current asset: 50.056mil)
Dividend policy: 40%-60% of PAT

Financial Ratio
Trade Receiveables turover: 111.1 days
Trade Payable Turnover: 31.3 days
Inventory Turnover: 102.3 days
Current Ratio: 2.5
Gearing Ratio: 0.3
ROE: 10.09%

Cost (2016)
Materials: 75.5%
Labour cost: 9.2%
Overheads: 15.3%

Past Financial Proformance (Revenue)
2016 (9mths): RM 55.066 mil (eps: 0.031)
2015: RM75.297 mil (eps: 0.024)
2014: RM81.387 mil (eps: 0.022)
2013: RM80.816 mil (eps: 0.027)

Net Profit Margin
2016: 13.52%
2015:  7.74%
2014:  6.53%
2013:  8.11%

After IPO Sharesholding
Eu Ah Seng: 10.28%
Tai Hin & Son PG Sdn Bhd: 48.59%
Dato' Seri Cheah (51.35% on Tai Hin)
Cheah Familiy (48.65%)

Director Remuneration (from gross profit 2015)
Tan Sri Dato' Dr.Sak Cheng Lum: RM50k
Dato' Seri Cheah RM300k-350k
Eu Ah Seng: RM250k-300k
Cheah Siang Tee: RM300k-350k
Cheah Eu Lee: RM50k
Tuan Haji Mohd Isa Bin Talib: RM50k
Ng Meng Kwai: RM50k
Ong Beow Chieh: RM50k
Total director from Gross profit RM0.85mil (4.93%) to RM1.25mil (7.25%)

Use of fund
New Manufacturing Lines & autonation system: 12.580mil (72.8%)
IPR & overseas brading: 1.5mil (8.7%)
Listing Expenses: 3.2mil (18.5%)

Conclusion
Good thing is:
1. Big portion of IPO fund use to expand business
2. PE still below 10
3. More than 50% is expprt, not highly depend on local market
4. Low debt
5. Have clear dividend policy

The bad things:
1. Listing on Ace market
2. Director might too many & diretor fee is expensive
3. ROE% only 10%, Net profit margin might not attractive.
4. Lisitng expenses is unaccetable expensive in %

Conclusions
We see the intention of the IPO is to grow the business bigger. It should be a fair deal.

IPO Price: RM0.36
Good time: 0.53 (PE13)
Bad time: 0.245 (PE6) 

Wednesday, March 8, 2017

Eco World International Berhad

IPO (Rating 1.25 star out of 5.0)
Copyright@http://lchipo.blogspot.com/

Date
Open to apply: 09/03/2017
Close to apply: 21/03/2017
Listing date: 03/04/2017

IPO Issue
2 bonus of EWI warrant for every 5 EWI shares held after IPO.
Final price might lower then RM1.20 if final institution price lower than RM1.20

Warrant Detail
Unit: 960 mil warrant
Tunere: 5 year to expire
Excersive Price: 121% from the final price
***If use RM1.20 to cal, excersive price is RM1.45
***Warrant price is not same with excersice price

Core Business, Geo
Business: Real Estate / Properties
Geo: UK, Australia

On Going Project (Gross Development Value)
London City Island Phase 2: RM3,762.8 mill (handover 2018, 2019)
Embassy Gardens Phase 2, London: RM5,076.10 mil (handover 2018, 2019,2021)
Wardian London: RM3.0816 (handover 2020)
West Village, Parramatta Sydney: RM1,042.3 mil (handover 2020)
Total on going project value: RM12,962.8 mil

Fundamental
Market: Main Market
Price: RM1.20 (par value:RM1.00)
EPS: -RM0.967
P/E: -1.24 (PE Negative)
Cash & fixed deposit after IPO: RM0.504 per shares
NA after IPO: RM1.06
Debt ratio after IPO: 0.0162
Dividend policy: No Fixed policy of dividend

Financial Ratio
Current Ratio: 0.19
Gearing Ratio: 9.69

Past Financial Proformance (Revenue)
2016: RM0.683 (EPS -0.967)

After IPO Sharesholding
Tan Sri Liew: 10.3%
Dato' Teow: 0.6%
Tan Sri Azlan: 0.3%
Dato' Siow Kim Lun: 0.2%
Cheah Tek Kuang: 0.2%

Director Remuneration (from gross profit 2015)
Tan Sri Liew: RM4.650 mil - RM4.7 mil
Dato' Teow: RM6.050 - RM6.1 mil
Tan Sri Azlan: RM0.2 mil - RM0.25 mil
Dato' Siow Kim Lun: RM0.2 mil - RM0.25 mil
Cheah Tek Kuang: RM0.2 mil - RM0.25 mil

Use of fund
Debt Repayment: 52.9%
Settlement of Acquisition of EW Investment: 1.5%
Working Capital: 43.6%
Listing Expenses: 2%

Conclusion
Good thing is:
1. 2018 onward only can have harvert the investment return.
2. Have some free warrant.

The bad things:
1. Company in still in losses.
2. 52.9% IPO fund use to pay debt.
3. Minimum RM11mil director fee is very expensive.
4. Director hold too small shares in company.

Conclusions
The only attractive part is the handover project start from 2018 until 2021. Anything can happen from now until 2018, & our blog believe investor will have opportunities to buy below IPO price.
Hope it not like another AAX case.

IPO Price: RM1.20
After IPO price should fall below RM1.20

Friday, December 30, 2016

Serba Dinamik Holding Berhad

IPO (Rating 2.5 star out of 5.0)
Copyright@http://lchipo.blogspot.com/

Date
Open to apply: 30/12/2016
Close to apply: 19/01/2017
Listing date: 08/02/2017

Core Business, Geo, Customers, Supplier
Business: Enginnering solution on O&G & power generation.
Geo (operating facilities): Malaysia, Indonesia, Bahrain, UAE, UK
Customer 2016: Petronas 23.14%, Sarawak shell bhd 3.36%, Energy Engineering & Services 2.53%, Energy Machine Services L.L.C 1.02%
Supplier: Technorette sdn bhd 14.38%, FRZ Scientific 10.95%, Qatar Enginerring & Construction 10.02%

Fundamental
Market: Main Market
Price: RM1.50 (par value:RM0.50)
Intrinsic Value: RM1.48 (forcase by 2016 EPS0.152)
EPS: RM0.152
P/E: 9.87
Cash & fixed deposit after IPO: RM0.38 per shares
NA after IPO: RM0.76
Dividend policy: at least 30% on PAT

Financial Ratio
Trade Receivables turnover days: 95.70
Trade Payable turnover days: 70.81
Inventory turnover days: 62.82
Current Ratio: 1.25
Gearing Ratio: 0.82
Debt ratio: 0.19 (Debt: RM0.861 bil, Total Asset: RM1.885 bil)

Past Financial Proformance (Revenue)
2013: RM 536.195 mil (EPS: 0.95)
2014: RM 755.768 mil (EPS: 1.03)
2015: RM1402.942 mil (EPS: 2.52)
2016 (6 mths): RM 911.726 mil (EPS: 1.52)

After IPO Sharesholding
Hj.Abdul Kadier: 22.22%
Dato' Awang Daud: 14.17%
Dato' Karim: 28.02%

Director Remuneration (from gross profit 2015)
Hj.Abdul Kadier: RM350k-400k
Dato' Awang Daud: RM900k-950k
Dato' Karim: RM1150k-1200k
Dato' Mohamed Nor: RM150k-200k
others 3 director: RM100k-150k
***total director fee from gross profit: 1.23%-1.38%

Use of fund
Expansion of business & operation facilities: 73.69%
Working capital: 7.2%
Repayment borrowing: 14.74%
Listing expenses: 4.37%

Conclusion
Good thing is:
1. PE around 10
2. Intrinsic value is near to IPO price (earning power).
3. Debt ratio still acceptable.
4. Revenue still growing.

The bad things:
1. O&G still industry still very depend on the crude oil price.
2. Receiveable turnover days quite high.
3. Director fee is look lower in percetage but the amount pay out is very heavy if they unable to sustain their revenue.
4. 14.74% IPO use to pay debt.

Conclusions
The timing of IPO might not the best for the company since crude oil price still in low level. Might not able to provide good return in short-term.

IPO Price at RM1.50 (PE9.87)
Good time : RM1.82 (PE12)
Bad time : RM0.76 (PE5)