IPO - Favelle Favco (Second Board)
Favelle Favco offers 48 million new shares and 22 million offer shares in its initial public offering (IPO), which are worth RM26.4 million based on a final price of RM0.55 per share.
Favelle Favco is a subsidiary of Muhibbah Engineering (M) Bhd, currently makes about 70 cranes a year at its factory in Senawang, Negri Sembilan. This translates into a 70 per cent capacity utilisation. The group is currently among the top 10 global suppliers for tower cranes, port/wharf cranes and offshore cranes.
About 80 per cent of the group's revenue are derived from overseas markets. In the last five years, Favelle Favco penetrated the US, Mexico, Azerbaijan and countries around the North Sea.
Today, some 70 per cent of the group's total revenue come from projects in the oil and gas industry. Its clients include Shell, British Petroleum, Exxon Mobil, Hyundai Heavy Industries, Talisman Energy and Petroliam Nasional Bhd.
Usage of IPO earning:
- Repay the group's borrowings
- Finance its research and development activities
- Pay for listing expenses and working capital
Future Plan:
- To expand its presence in countries such as Russia, Brazil and the Middle East, which are highly active in the oil and gas and construction industries.
Recent Contracts:
- Secured six new contracts from the Netherlands, Singapore and Malaysia. The current order book stands at RM310 million which should keep it busy until 2008
Revenues & Profits:
- In fiscal year to December 2004, the group made an after-tax profit of RM13.3 million (Exceptional gain of RM8.8 million) on RM267 million revenue.
- In fiscal year to December 2005, the group made an after-tax profit of RM7.8 million on RM330 million revenue.
- Projected RM349 million revenue for December 2006
Favelle Favco is a subsidiary of Muhibbah Engineering (M) Bhd, currently makes about 70 cranes a year at its factory in Senawang, Negri Sembilan. This translates into a 70 per cent capacity utilisation. The group is currently among the top 10 global suppliers for tower cranes, port/wharf cranes and offshore cranes.
About 80 per cent of the group's revenue are derived from overseas markets. In the last five years, Favelle Favco penetrated the US, Mexico, Azerbaijan and countries around the North Sea.
Today, some 70 per cent of the group's total revenue come from projects in the oil and gas industry. Its clients include Shell, British Petroleum, Exxon Mobil, Hyundai Heavy Industries, Talisman Energy and Petroliam Nasional Bhd.
Usage of IPO earning:
- Repay the group's borrowings
- Finance its research and development activities
- Pay for listing expenses and working capital
Future Plan:
- To expand its presence in countries such as Russia, Brazil and the Middle East, which are highly active in the oil and gas and construction industries.
Recent Contracts:
- Secured six new contracts from the Netherlands, Singapore and Malaysia. The current order book stands at RM310 million which should keep it busy until 2008
Revenues & Profits:
- In fiscal year to December 2004, the group made an after-tax profit of RM13.3 million (Exceptional gain of RM8.8 million) on RM267 million revenue.
- In fiscal year to December 2005, the group made an after-tax profit of RM7.8 million on RM330 million revenue.
- Projected RM349 million revenue for December 2006
posted by Ho Sang @ 3:07 PM
2 Comments:
At 7:44 PM,
nik271 said…
Kim Eng's in its research note put target price at 70 sen. I believe this stock will perform well although it is second board. It is good move by its parent, Muhibah to unlock the value. I think 60 sen to 65 sen is not asking too much for this 55-sen IPO.
At 5:27 AM,
Ho Sang said…
Favelle Favco opens 36% higher on it's first day! It macth the expected result.
Not sure how the IPO being over-subscribed as there's no way to apply for it via Maybank nor OSK Security Firm...
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