IPO Rating (1.75/5.0 Stars)
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Date
Open to apply: 29/06/2020
Close to apply: 10/07/2020
Listing date: 23/07/2020
Share Capital
Market Cap: RM46.944 mil
Total Shares: mil shares (Public apply:10.8 mil, Company Insider/Miti/Private Placement/other: 97.2mil)
Industry
Property & construction segment have been in slow growth phase in Malaysia for this few years. However it still cannot category as sunset industry. I will be in temporary sleeping mode for industry growth.
**CAGR posted in Prospectus book using forecase 2019-2024, we decided do not take this as reference as it did not reflect true CAGR 5 year average of previous year result.
Competitor (Profit before tax margin)
TCS: 6.1% (PE5.75)
Gagasan: 15.2% (PE9.31)
GDB: 11.7% (PE12.92)
Inta Bina: 7.2% (PE5.9)
Business
Construction services for buildings, infrastructure, civil and structural works in Malaysia.
Fundamental
Market: Ace Market
Price: RM0.23 (EPS:0.04)
P/E: PE5.75
ROE: 26.5 (IPO pro Forma III)
ROE: 26.5 (2019), 16.6 (2018), 10.5(2017), 8.6 (2016)
Cash & fixed deposit after IPO: RM0.0899 per shares
NA after IPO: RM0.16
Total debt to current asset after IPO: 0.86 (Debt:119.484 mil, Non-Current Asset: 39.607mil, Current asset: 138.962mil)
Dividend policy: No fix dividend policy.
Past Financial Performance (Revenue, EPS)
2019: RM358.424 mil (EPS: 0.0435)
2018: RM146.266 mil (EPS: 0.0269)
2017: RM71.718 mil (EPS: 0.0172)
2016: RM103.628 mil (EPS: 0.0141)
Net Profit Margin
2019: 4.37%
2018: 6.71%
2017: 8.63%
2016: 4.91%
After IPO Sharesholding
Dato' Ir Tee Chai Seng: 59.07%
Datin Koh Ah Nee: 10.42%
Directors Remuneration for FYE2021 (from gross profit 2019)
Dato' Ir Tee Chai Seng: RM1.004 mil
Datin Koh Ah Nee: RM367k
Tan Sri Dato' Sri Izzuddin bin Dali: RM75k
Dato' Seri Ir Mohamad Othman Bin Zainal Azim: RM63k
Ooi Guan Hoe: RM63k
Total director remuneration from gross profit: RM1.572 mil or 4.17%
Key Management Remuration for FYE2021 (from gross profit 2019)
Ooi Kee An: RM200k-250k
Yap Choo Cheng: RM200k-250k
Liew Kok Yoong: RM100k-150k
Ho Chee Woei: RM150k-200k
Koo Yoke Ping: RM50k-100k
Ng Lee Foong: RM50k-100k
key management remuneration from gross profit: RM1.05 mil or 2.78%
Use of fund
Purchase of new construction machinery and equipment: 62.80%
Working capital: 20.29%
Listing Expenses: 16.91%
Good thing is:
1. Low PE, ROE26.5
2. ROE increase over pass few years.
3. Use 83.09% IPO fund to expand business.
4. Revenue have growth for pass 4 year.
5. Low interest environment will encourage property industry.
The bad things:
1. Compare to other competitor, profit margin not high & net profit margin less than 10%.
2. Direcrtor fee have a bit expensive.
3. Listing Expenses is expensive.
4. Unable to know the true industry CAGR for past 5 years.
5. No fixed dividend policy.
Conclusions (Blogger is not wrote any recommedation & suggestion. All is personal opinion)
The industry of their business is on sleeping mode. As property & construction is growing slow in Malaysia for past few years. We still have many other good opportunities to allocate properly our capital for investment.
IPO Price: RM0.23
Good time: RM0.32 (PE8)
Bad time: RM0.16 (PE4)
*Valuation is only personal opinion & view. Perception & forecast will change if any new quarter result release. Reader take their own risk & should do own homework to follow up every quarter result to adjust forecast of fundamental value of the company.