Greatec 0208

https://klse.i3investor.com/m/blog/general/210713.jsp
Greatech Technology Berhad 

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 
IPO 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 IPO 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