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Date
Open to apply: 24/09/2019
Close to apply: 30/09/2019
Listing date: 14/10/2019
Share Capital
Market Cap: RM623 mil
Total Shares: 427.115 mil shares (IPO 17.084 mil, Company Insider/Miti/Private Placement 111.050 mil)
Business
Construction on industrial, property development, engineering, property investment.
Contract income: 80.93%
Property income: 12.72%
Rental income: 6.35%
Fundamental
Market: Mian Market
Price: RM1.30 (eps: RM0.11) will refund if Ins IPO price lower than RM1.30.
P/E & ROE: PE11.73, ROE8.38%
Cash & fixed deposit after IPO: RM0.408 per shares
NA after IPO: RM1.32
Total debt to current asset after IPO: 0.778 (Debt: 507.483 mil, Non-Current Asset: 448.306 mil, Current asset: 652.127 mil)
Dividend policy: Propose 20 PAT dividend policy.
Financial Ratio
Trade receivable: 44 days
Trade Payable: 66 days
Inventory turnover: 39 months
Past Financial Proformance (Revenue, EPS)
2019: RM339.013 mil (eps: 0.1109)
2018: RM341.320 mil (eps: 0.1662)
2017: RM298.958 mil (eps: 0.1350)
2016: RM249.243 mil (eps: 0.0763)
Net Profit Margin
2019: 15.04%
2018: 22.92%
2017: 19.10%
2016: 13.08%
After IPO Sharesholding
Tengku Azrina: 0.1%
Lee Chai: 21%
Lim Yook Kim: 21%
Kang Ah Chee: 21%
Lee Sai Boon: 7%
Lim Pei Shi: 0.1%
Chang Tian Kwang: 0.1%
Tan Lay Beng: 0.1%
Wee Soon Chit: 0.1%
Director & Key Managemen Remuneration for FYE2019 (from gross profit 2018)
Tengku Azrina: 61.8k
Lee Chai: 3.095 mil
Lim Yook Kim: 0.980 mil
Kang Ah Chee: 0.980 mil
Lee Sai Boon: 2.473 mil
Lim Pei Shi: 0.451 mil
Chang Tian Kwang: 41.2k
Tan Lay Beng: 48.1k
Wee Soon Chit: 41.2k
Total director & key management remuneration from gross profit: 9.346mil or 9.94%
Use of fund
Industrial property development & investment project: 62.2%
Working capital: 20.7%
Precast Concrete Fabrication Capacity: 8.1%
Lisitng Expenses: 9.00%
Competitors (PE)
*doesn't have very similar competitor because their business is focus on contruct industry property.
SPsetia PE16.36
Mahsing: PE7.88
Ecowrld: PE9.89
UEMS: PE28.23
Bpuri: loss making
Industry Analysis (Forecast)
2013-2018: per year
Industrial Construction: 3.3%
Precast Concrete: 11.13%
Steel Engineering: 4.8%
M&E: 20.21%
Indutry property: 4.01%
Conclusions
Good thing is:
1. PE on average level in the same industry.
2. Almost all IPO fund to use in business development.
3. Gov is focus on industry 4.0 & trade war will encourage the migrate of business to Asia countries.
4. Net profit margin is 15.04%
The bad things:
1. ROE too low.
2. Their business industry still in slow growing stage.
3. Director remuration is around 9.94% from gross revenue.
4. Revenue doesn't growth for past 2 years.
Conclusions
The business is focus on contruct industry property. The industry 4.0 might help, but believe still on the not the easy journey. Fully using the fund for business expansion is very encourage. Is only can consider a 60:40 winning ratio on this investment (40% rate of winning ratio).
IPO Price: RM1.30
Good time: RM1.21 (PE11)
Bad time: RM0.88 (PE8)