IPO (Rating 1.0 star out of 5.0)
Copyright@http://lchipo.blogspot.com/
Date
Open to apply: 19/12/2016
Close to apply: 03/01/2017
Listing date: 17/01/2017
Core Business, Customers, Supplier
Business: Plantation estate, Sale of FFB, & Property Investment Holding.
Major Customer: Lenga Palm Industrial S/B (100%, 2016)
Supplier: Twwin Arrow Fertillizer S/B 68.2%, Nisin Bio Tech 19.4%
Fundamental
Market: Ace Market
Price: RM0.13 (par value:RM0.10)
Intrinsic Value: RM0.075 (forcase by 2016 EPS RM0.0009)
EPS: RM0.0009
P/E: 144.44
Cash & fixed deposit after IPO: RM0.015 per shares
NA after IPO: RM0.10
Dividend policy: Does not fixed any dividend policy
Financial Ratio
Trade Receivables turnover days: 23
Trade Payable turnover days: 27 (2015d data, 2016 no data)
Inventory turnover days: 17
Current Ratio: 17 (after IPO 29.96)
Debt ratio: 0.013 (Debt: RM2.396 mil, Total Asset: RM184.53 mil)
Past Financial Proformance (Revenue)
2013: RM 8.720 mil (EPS: 0.0011)
2014: RM 9.402 mil (EPS: 0.0011)
2015: RM 7.411 mil (EPS: 0.0010)
2016: RM 7.169 mil (EPS: 0.0009)
Platation area (by Hectares)
Less profitable trees
Replanting: 16.4 (need 5 years to mature)
1-4 years: 217.6
21-25 years: 16.4
Profitable trees
5-10 years: 244.9
11-15 years: 216.8
16-20 years: 370.0
After IPO Sharesholding
Eng Cheng Guan 0.01%
Datuk Tan Teck Poh 0.01%
Ng Keng Heng 0.05%
Director Remuneration (from gross profit 2016)
Eng Cheng Guan 50k-100k
others 11 director 0-50k
***total director fee from gross profit 2015: 1.09%-14.27%
Use of fund
Replanting: 1.5%
Capital Expenditure: 15.1%
Working Capital: 70.5%
Listing Expenses: 12.9%
Conclusion
Good thing is:
1.Profitable trees 76.9% (2016), the company forecast 93.3% (2017).
2. Debt is very low compare Asset
The bad things:
1. PE is too high because of EPS too low.
2. Director fees too high (14.27% from gross profit 2016) & too many directors for this company size.
3. Yearly profit is dropping.
4. Director holding % very low (major sharesholder Huaren, Rohua, MHB)
Conclusions
Avoid this IPO