IPO Rating (1.75 star out of 5.0)
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Date
Open to apply: 27/11/2018
Close to apply: 18/12/2018
Listing date: 07/01/2019
Share Capital
Market Cap: RM121.683 mil
Shares Issue to sell: 126.560 mil shares
Enlarged Issued Shares: 486.731 mil shares
Business
Manufaczture Aeosol product- DPI, Achor, Kromoto
Private label manufacturing services.
Market sizes (2013-2017 CAGR)
Msia: 8.1% (ave one year 1.6% per yr)
Japan: 3.9%
Australia: 4.1%
New Zealand: 4.0%
Indonesia: 3.2%
Vietnam: 3.2%
Myanmar:4.2%
Revenue on Geo (2018)
Msia: 81.74%
Outside Msia: 18.26%
Fundamental
Market: Ace Market
Price: RM0.25 (eps: RM0.0163)
P/E & ROE: PE15.34, ROE9.3%
Cash & fixed deposit after IPO: RM0.097 per shares
NA after IPO: RM0.13
Total debt to current asset after IPO: 0.12 (Debt: 7.881 mil, Non-Current Asset: 5.724 mil, Current asset: 65.656 mil)
Dividend policy: -
Financial
Trade Receivable: 58 days
Trade payable: 69 days
Past Financial Proformance (Revenue, EPS)
2018: RM50.294 mil (eps: 0.0163)
2017: RM49.360 mil (eps: 0.0258)
2016: RM46.923 mil (eps: 0.0206)
Net Profit Margin
2018: 11.86% (after exclude one-off asset dispose gain)
2017: 18.82%
2016: 15.81%
After IPO Sharesholding
Peter Chai: 56.98%
Adam Chai: 17.02%
Datuk Seri Nurmala: 0.04%
Fong Yoo Kaw: 0.04%
Lau Kok Hiyong: 0.04%
Director Remuneration for FYE2019 (from gross profit 2018)
Peter Chai: 806k
Adam Chai: 262k
Datuk Seri Nurmala: 60k
Fong Yoo Kaw: 60k
Lau Kok Hiyong: 60k
Total director remuneration from gross profit: 7.33%
Operation Capicity
2017: 72.32%
2018: 77.84%
Use of fund
Capital expenditure & expansion: 74.4%
Sales, Marketing & Advertising: 9.48%
Product development: 4.11%
Estimated listing expenses: 12.01%
Conclusion
Good thing is:
1. Low debt company.
2. Revenue is growing, but EPS not growing.
3. Almost all IPO funds use to expand business.
The bad things:
1. Ace market with PE15 is consider a bit expensive.
2. Market demand (market size sold by cans) on CAGR is very low.
3. No claer dividend policy.
4. Director remuneration is expensive.
Conclusions
Is a average IPO. The market demand CAGR rate of the product showing the business not likely to grow too fast.
IPO Price: RM0.25
Good time: RM0.25 (PE15)
Bad time: RM0.13 (PE8)