Listing Detail:
Listing Sought: Main Market
Issue Price: RM 1.42

Dates:
Offer Period Open: -
Offer Period Close: 07 Jun 2018
Tentative listing date: 20 Jun 2018

Number of shares:
Public Issue: 134,428,000
Offer for Sale: 18,521,000
Private Placement: 110,449,000

Stock Code: MI

Official Announcement

INITIAL PUBLIC OFFERING ("IPO") IN CONJUNCTION WITH THE LISTING OF Mi EQUIPMENT HOLDINGS BERHAD ("Mi EQUIPMENT HOLDINGS") ON THE MAIN MARKET OF BURSA MALAYSIA SECURITIES BERHAD COMPRISING:

(I) PUBLIC ISSUE OF 134,428,000 NEW ORDINARY SHARES IN Mi EQUIPMENT HOLDINGS ("SHARES") ("ISSUE SHARES") IN THE FOLLOWING MANNER: 25,000,000 ISSUE SHARES AVAILABLE FOR APPLICATION BY THE MALAYSIAN PUBLIC; 17,500,000 ISSUE SHARES AVAILABLE FOR APPLICATION BY THE ELIGIBLE PERSONS (AS DEFINED IN THE PROSPECTUS); 60,449,000 ISSUE SHARES BY WAY OF PRIVATE PLACEMENT TO IDENTIFIED INVESTORS; 31,479,000 ISSUE SHARES BY WAY OF PRIVATE PLACEMENT TO IDENTIFIED BUMIPUTERA INVESTORS APPROVED BY THE MINISTRY OF INTERNATIONAL TRADE AND INDUSTRY ("MITI"); AND

(II) OFFER FOR SALE OF 18,521,000 EXISTING SHARES ("OFFER SHARES") BY WAY OF PRIVATE PLACEMENT TO IDENTIFIED BUMIPUTERA INVESTORS APPROVED BY THE MITI,

AT AN IPO PRICE OF RM1.42 PER ISSUE SHARE/OFFER SHARE, PAYABLE IN FULL UPON APPLICATION.

Company Overview

Mi Equipment Holdings Berhad operates as a holding company. The Company, through its subsidiaries, manufactures factory automation equipment. Mi Equipment Holdings offers wafer to reel final test handlers, art die sorting machines, and other equipment. Mi Equipment Holdings serves customers in Asia and the United States.

Address & Contact:

Mi Equipment Holdings Berhad,
Plot 13, Bayan Lepas Technoplex,
MK 12, Industrial Zone Phase 4,
11900 Bayan Lepas,
Penang, Malaysia

Telephone: (+60)4 6301288
Fax: (+60)4 6301283
Website: https://www.mi-eq.com/

Emails:

Products & Solutions: sales@mi-eq.com
Human Resource: hr@mi-eq.com

Share Capital
Market Cap: RM710 mil
Shares Issue to sell: 18.655 mil shares
Enlarged Issued Shares: 134.428 mil shares

Business

Design, Develop, Manufacture & Sale WLCSP storting machine (use in semiconductor industry)

Revenue on Geo (2017)
Southeast Asia 8.77%
Northeast Asia 63.70%
North Atlantic 10.78%
Malaysia 16.75%

Fundamental
Market: Main Market
Price: RM1.42 (eps: RM0.1186)
P/E & ROE: PE11.97, ROE18.7%
Cash & fixed deposit after IPO: RM0.38 per shares
NA after IPO: RM0.62
Total debt to current asset after IPO: 0.1189 (Debt: 31.873  mil, Non-Current Asset: 74.459 mil, Current asset: 267.983 mil)
Dividend policy: suggest 20% profit after tax

Financial
Trade Receivable: 75 days
Trade payable: 67 days

Past Financial Proformance (Revenue, EPS)
2017: RM173.321 mil (eps: 0.1186)
2016: RM57.089 mil (eps: 0.0322)
2015: RM105.143 mil (eps: 0.0818)

Competitor PAT Margin %
ASM Pacific: 4.49%
Daitron: 3.58%
Muehlbauer: 31.01%
Tesec: 10.4%
Mi Equipment: 34.21%

Net Profit Margin
2017: 34.22%
2016: 28.16%
2015: 38.91%

After IPO Sharesholding
Foo Hee Chaik: 0.06%
Oh Kuang Eng: 68%
Koay Huck Khim: 0.06%
Ong Tee Ni: 0.36%
Lee Boon Leng: 0.06%
Tan Boon Hoe: 0.06%

Director Remuneration (from gross profit 2017)
Foo Hee Chaik: 63k
Oh Kuang Eng: 1.711 mil
Koay Huck Khim: 0.292 mil
Ong Tee Ni: 0.226 mil
Lee Boon Leng: 45k
Tan Boon Hoe: 45k
Total director remuneration from gross profit: 2.55%

Use of fund
New factory & office (Bayan Lepas): 34.06%
New factory & office (Batu Kawan): 39.29%
R&D: 3.14%
Working Capital: 19.27%
Listing Expenses: 4.24%

Conclusion

Pros:

1. Semiconductor still is a sunrise industry.
2. PE11.4 still consider acceptable rang & ROE18.7% is good.
3. PAT margin is good.
4. Debt ratio is healthy.
5. Director fee is healthy.
6. 95.76% of IPO fund use to develop business.

Cons:

1. Other compeitor PAT margin is around 10% or below. After IPO need to maintain high PAT margin.
2. Timing of listing in June 2018 might in market low period.
3. Technology changing is fast in this industry.
4. Customer repeat order will take years time because their product is selling machines, so they have to keep find new order.

Overall, this is a good IPO. Should able to see the company growth faster after 2 years time. Investment will have good return on this company.

News: Mi Equipment to raise RM190.87m from IPO

KUALA LUMPUR: Mi Equipment Holdings Bhd plans to raise up to RM190.87mil from the issuance of new shares under its floatation exercise on the Main Market of Bursa Malaysia Securities.

In its prospectus issued on Monday, the equipment manufacturer of wafer level chip scale packaging (WLCSP) sorting machines for the semiconductor industry said it was issuing 134.428 million new shares at RM1.42 each.

Of the new shares, it said 25 million shares would be offered to the public, 17.50 million shares to eligible persons and 60.449 million shares would be placed out. The remaining 31.479 million shares would be placed out to approved Bumiputera investors.

The shareholders would also offer for sale 18.52 million existing shares which would be placed out to approved Bumiputera investors.

The listing is scheduled for June 20.

Mi Equipment said of the RM190.88mil to be raised from the issuance of new shares, it would use 34% or RM65mil to build a factory cum office in Bayan Lepas, Penang. It will also use 39.3% or RM75mil to build a new factory and office in Batu Kawan, Penang.

Another 19.3% or RM36.78mil would be used for working capital, RM6mil for research and development and the remaining RM8.10mil for listing expenses.

Mi Equipment said the board plans to recommend and distribute a dividend of at least 20% of its annual audited profit after tax attributable to the shareholders of the company.