IEV Holdings Limited ("IEV") launched its Catalist listing for 37m new shares at $0.30 each via placement through Collins Stewart. IEV is an acronym for "Innovative Engineering Ventures" and supports the offshore oil and gas industry in Asia Pacific.
IEV claimed to have invented an "ocean-powered" marine growth control technology that prevents any marine life to grow on the offshore platforms. (Hmm... it is always interesting how these most environmentally unfriendly companies try to position themselves as clean and green).
I think in layman's terms, IEV provides "technology" that can extend the life of the platforms as marine life (i presume such as clams and mussels) are unable to 'stick' onto the metal railings. Such a business has proven to be lucrative as the Company is able to carve a niche for itself. The audited revenue grew from RM 25.3m in FY2008 to RM 67.7m in FY2010 and the profit after tax grew from a loss of RM6.2m in FY2008 to a profit of RM16.8m in FY2010.
The Company has proposed that it intend to distribute at least 10% of its net profits for FY2011 as dividends. The IPO will close on 21 Oct at 12pm. Based on the enlarged share capital of 135m shares, the NTA per share is about 15.3 cents and the listing PER is about 7.5x. The market cap at its IPO price is $51.6m
At its IPO price, i think the company is priced fairly. I have not attempted to 'forecast' its 2011 profits but from the look of the graphs above, the earnings can be quite 'lumpy' and leaned towards the 2nd half of the year.
It is quite 'heartening' to see one IPO making a comeback after such a long lull period even though it is a Catalist listing. For the sake of our local bourse, I hope this Company will do well enough such that more companies dare to come forward. Unfortunately, the challenges faced continue to be the weak market sentiments and the recent weeks of steep price declines had make existing stocks valuations more attractive vis-a-vis this company.