IPO Rating ( 3.25 star out of 5.0)
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Date
Open to apply: 28/06/2018
Close to apply: 09/07/2018
Listing date: 20/07/2018
Share Capital
Market Cap: RM174.759 mil
Shares Issue to sell: 81.66 mil shares
Enlarged Issued Shares: 317.743 mil shares
Business
Health care product (mostly distribution on pharmacies)
Revenue on Geo (2017)
M'sia: 96.1%
Others: 3.9%
Fundamental
Market: Ace Market
Price: RM0.55 (eps: RM0.0431)
P/E & ROE: PE12.76, ROE25.64%
Cash & fixed deposit after IPO: RM0.0416 per shares
NA after IPO: RM0.17
Total debt to current asset after IPO: 0.3435 (Debt: 12.703 mil, Non-Current Asset: 36.980 mil, Current asset: 29.187 mil)
Dividend policy: suggest 30% audited profit
Financial
Trade Receivable: 125 days
Trade payable: 24 days
Past Financial Proformance (Revenue, EPS)
FPE2017 (6mth): RM12.486 (eps: 0.05)
2017: RM24.541 mil (eps: 0.1466)
2016: RM24.270 mil (eps: 0.1448)
2015: RM22.847 mil (eps: 0.1313)
Competitor
Ahealth: PE16.51
Biohldg: PE17.05, 39.5% (gross profit margin)
CCMBIO: PE19.36
Herbal Science: 46.6% (gross profit margin)
BioFact: 30.4% (gross profit margin)
Net Profit Margin
2017: 55.9%
2016: 55.8%
2015: 53.7%
After IPO Sharesholding
Dr Abdul Manaf: 0.09%
Phang Nyie Lin: 7.95%
Tan Sok Mooi: 42.50%
Phang Yeen Nung: 7.95%
Phang Yeen Aun: 7.95%
Director Remuneration (from gross profit 2017)
Dr Abdul Manaf: 36k
Phang Nyie Lin: 111k
Phang Yeen Nung: 140k
Phang Yeen Aun: 140k
Dr Munavvar: 36k
Sulaiman: 36k
Sim Seng Loong: 36k
Tan Mio Har: 36k
Total director remuneration from gross profit: 3.25%
Use of fund
New GMP-Compliant Production Facility: 36.7%
R&D: 25.8%
Expand retail market: 11.2%
Working capital: 20.5%
Lisitng Expenses: 5.8%
Conclusion
Good thing is:
1. PE still in acceptable level & Debt in healthy level.
2. ROE is attractive & net margin profit is attractive.
3. Have clear dividend poslicy.
4. Director fee is acceptable level.
5. Three year revenue is increasing.
The bad things:
1. Listing in Ace Market.
2. Trade receivable is 125days (4 month) instead of 2 month company policy credit term.
3. High depend on local market.
4. High competitive enviroment.
5. Having import business (USD stronger now USD4.03 will increase the company cost).
Conclusions
Overall is a good IPO. However IPO timing might not too encourage as USD is stronger which will increase the company cost in short-term. However it should be a good investment for long term investment.
IPO Price: RM0.55
Good time: RM0.73(PE17)
Bad time: RM0.345 (PE8)