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Date
Open to apply: 13/05/2019
Close to apply: 24/05/2019
Listing date: 13/06/2019
Share Capital
Market Cap: RM381 mil
Shares Issue to sell: 119.750 mil shares (IPO 18.780 mil, Company Insider & placement 100.97 mil)
Business
Manufacture of Automated equipment & provision of parts and services for Solar, semiconductor, & consumer electronic sectors.
Geo
Local: 10.01%
Foreign: 89.99% (Vietnam 62.68% & USA 25.37%)
Fundamental
Market: Ace Market
Price: RM0.61 (eps: RM0.0627)
P/E & ROE: PE9.73, Ave ROE over 4yrs 11.74%
Cash & fixed deposit after IPO: RM0.11 per shares
NA after IPO: RM0.22
Total debt to current asset after IPO: 0.43 (Debt: 77.358 mil, Non-Current Asset: 39.243 mil, Current asset: 178.639 mil)
Dividend policy: Does not fixed any dividend policy.
Financial Ratio
Trade receivable: 65days (Ave over 4yrs)
Trade Payable: 62days (Ave over 4 yrs)
Past Financial Proformance (Revenue, EPS)
2018: RM219.582 mil (eps: 0.0627)
2017: RM93.914 mil (eps: 0.0376)
2016: RM22.703 mil (eps: 0.0115)
2015: RM21.393 mil (eps: 0.0111)
Net Profit Margin
2018: 14.45%
2017: 20.29%
2016: 25.59%
2015: 26.17%
After IPO Sharesholding
Tan Eng Kee: 74%
Director Remuneration for FYE2019 (from gross profit 2018)
Ooi Hooi Kiang: 66k
Tan Eng Kee: 698k
Khor Lean Heng: 510k
Mariamah Binti Daud: 66k
Ooi Ching Hock: 66k
Total director remuneration from gross profit: 3.1%
Use of fund
Business Expansion: 24.64%
Capital Expenditure: 6.85%
R&D expenditure: 6.85%
Working Capital: 50.03%
Repayment Debt: 6.16%
Lisitng Expenses: 5.47%
Competitor PE & ROE
Penta: PE22.28, ROE16
Vitrox: PE30.45, ROE24.88
Sam: PE14.18, ROE14.61
Mi: PE21.11, ROE13.42
Genetec: PE7.09, ROE11.38
Elsolf: PE14.29, ROE35.53
Industry Analysis (Asean 2012-2018)
Global Solar Cell & Solar Module Production CAGR:27.4% & 27.4%
Global Sales Semiconductor CAGR: 8.7%
Consumer Electronic CAGR: 6.1%
Conclusion
Good thing is:
1. PE9.73 still below PE10
2. Revenue is growing past 4 year.
3. Director fees around 3%
4. They are in the sunrise industry.
5. Business having 89.99% is export. The strong USD will benefit the company.
The bad things:
1. Average ROE11.74% (Below ROE15% level), their competitor ROE is higher.
2. IPO fund 6.16% use to pay debt.
3. IPO in the ACE market.
4. Effected by current trade war (might be opportunities & also might not).
Conclusions
Overall is a above average IPO. The most of the funds is use for expand the business.
Demand of their product is increasing every years.
IPO Price: RM0.61
Good time: RM0.94 (PE13)
Bad time: RM0.43 (PE7)