Copyright@http://lchipo.blogspot.com/Date
Open to apply: 30/09/2019
Close to apply: 11/11/2019
Listing date: 26/11/2019
Share Capital
Market Cap: RM136.718 mil
Total Shares: 390.623 mil shares (IPO 19.531 mil, Company Insider/Miti/Private Placement 79.297 mil)
Business
Design & Sale of solar energy sevices (EPCC services), Operations & Maintenance of solar energy services , and Operate Solar Plant.
EPCC Services: 94.7%
Operations & Maintenance: 0.16%
Solar PV plant: 5.12%
Fundamental
Market: Ace Market
Price: RM0.35 (eps: RM0.028)
P/E & ROE: PE12.5, ROE17.43%
Cash & fixed deposit after IPO: RM0.1145 per shares
NA after IPO: RM0.16
Total debt to current asset after IPO: 0.56 (Debt: 51.111 mil, Non-Current Asset: 23.644 mil, Current asset: 91.273 mil)
Dividend policy: No formal dividend policy.
Financial Ratio
Trade receivable: 71 days
Trade Payable: 54 days
Inventory turnover: 7 days
Past Financial Proformance (Revenue, EPS)
2019: RM112.201 mil (EPS: 0.028)
2018: RM45.069 mil (EPS: 0.021)
2017: RM39.009 mil (EPS: 0.017)
2016: RM35.286 mil (EPS: 0.011)
Net Profit Margin
2019: 9.9%
2018: 18.3%
2017: 16.7%
2016: 11.8%
After IPO Sharesholding
Lim Chin Siu: 41.1% (indirect)
Tan Chyi Boon: 41.1% (indirect)
Chiau Haw Choon 33.6% (indirect)
Director & Key Managemen Remuneration for FYE2019 (from gross profit 2018)
Dato' Che Halin: RM66k
Lim Chin Siu: RM490k
Tan Chyi Boon: RM463k
Chiau Haw Choon: RM42k
Chang Kong Foo: RM42k
Fong Shin Ni: RM42k
Total director & key management remuneration from gross profit: RM1.145mil or 5.1%
Use of fund
Business expansion: 8.7%
Capital expenditure: 11.5%
Working capital: 55.5%
Repayment Debt: 14.5%
Listing expenses: 9.8%
Competitors (PE & ROE)
Solarvest: PE12.5 ROE17.43% GP9.9%
Cypark: PE8.76, ROE10.49%
Tekseng: Loss making
Gading Kencana: loss making
Helios PV: GP23.9%
Mattan: GP1.3%
Plus Solar: GP12.4%
Industry Analysis (Forecast)
Green energy is very clearly futures trend of energy. Solar is in sunrise industry with a lot competitors.
Conclusions
Good thing is:
1. Co-founder Owners is young.
2. PE12.5 still acceptable, but a bit high in same industry & ROE17.43% is healthy.
3. Debt ratio is healthy.
4. Revenue growing for past 4 years.
5. In sunrise industry.
The bad things:
1. Net profit margin slowing down.
2. No clear dividend policy.
3. Director remuration is over 3% of gross revenue.
4. Use 14.5% IPO fund to pay debt.
5. Many competitors not making good profit in same industry.
6. Listing on Ace market.
7. Revenue highly depend on EPCC segment.
Conclusions
Green energy is a must in futures. However they are facing large competitors environment in same industry.
Will consider is an average IPO.
IPO Price: RM0.35
Good time: RM0.38 (PE13.5)
Bad time: RM0.17 (PE6)