Wednesday, March 8, 2017

Eco World International Berhad

IPO (Rating 1.25 star out of 5.0)

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

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%

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.

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

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