• Mooreast Holdings is a total mooring solutions specialist, serving mainly the offshore oil & gas (O&G), marine and offshore renewable energy industries. The Group’s operations are primarily in Singapore and it maintains a European sales office in Rotterdam, the Netherlands.
   
• The Group’s total Revenue grew 31% from S$15.0 million in FY2018 to S$19.7 million in FY2020, while Profit Net of Tax grew 13% from S$3.4 million in FY2018 to S$3.8 million in FY2020.
   
• The Group believes that the renewable energy industry offers good growth prospects with the increasing focus around the world on renewable energy sources, in particular, from floating offshore wind farms and floating Solar PV farms. Accordingly, it intends to leverage on its existing capabilities in providing total mooring solutions to further grow and develop its renewable energy business.

Mooreast Holdings is a total mooring solutions specialist, serving mainly the offshore oil & gas (O&G), marine and offshore renewable energy industries. The Group’s operations are primarily in Singapore and it maintains a European sales office in Rotterdam, the Netherlands through its subsidiary, Mooreast Europe. The Group also provides rigging equipment, marine supplies and related services to its customers.

Mooreast Holdings’ operations consist of four main business segments: (i) Mooring Division, (ii) Renewable Energy Division, (iii) Rigging and Heavy Lifting Division, and (iv) Marine Supplies and Services Division.

Highlights of the IPO based on Offer Document (click here)

1. Business Segments

Mooreast Holdings operates 4 main business segments:

• Mooring - Design, engineering, fabrication, supply, mobilisation and logistics, installation and commissioning, and leasing services for mooring systems and mooring system components.
• Renewable Energy - Provision of mooring solutions for floating wind turbine projects, offshore Solar photovoltaic (PV) projects and tidal turbine projects in Asia and Europe.
• Rigging and Heavy Lifting - Supply of rigging and heavy lifting equipment to customers in the offshore O&G, marine industries and construction industry in Singapore, including steel ropes, synthetic ropes and chains.
• Marine Supplies and Services - Supply of marine mooring component products such as anchors, chains, mooring fenders, wire ropes, synthetic mooring ropes and other equipment to the marine industry.

2.  Business Strategies and Future Plans (refer to Page 146 of the offer document)

Develop and grow Renewable Energy Division by leveraging on existing capabilities in providing total mooring solutions.

• Establishing a physical presence in key markets such as Europe and Asia to be in close proximity to its customers which it believes will enhance its responsiveness to the needs of customers and improve the quality of its service.
   
• It also aim to strengthen its engineering as well as research and development capabilities in the renewable energy business with a focus on developing cost-effective solutions for customers through innovative design and research.

Expand and upgrade the facility at 51 Shipyard Road to undertake fabrication of floating and related steel structures used in the offshore wind farm.

• In addition to supplying key mooring system components, Mooreast Holdings also intends to undertake fabrication of floating and related steel structures used in the offshore wind farms.
   
• It intends to upgrade the yard facility at 51 Shipyard Road, acquired in July 2021, which has an estimated productive capacity of approximately 5,000 mt of steel throughput per annum, compared to 2,000 mt from previous facility at 14 Benoi Sector.

Expand and diversify products and services offerings and capabilities.

• The Group may implement its expansion and diversification in Singapore or other countries which it believes would enable it to build or enhance its competitive advantages such as proximity to new markets or access to resources which would bring about cost savings.

3. Competitive strengths (refer to Page 144 of the offer document for a complete list of competitive strengths)

• Experienced and dedicated management team – The management team is led by Executive Director, CEO and Deputy Chairman, Mr Sim Koon Lam, who has more than 30 years of experience in providing mooring and rigging solutions to customers in the offshore O&G, marine and the offshore renewable energy industries.
   
• Full range of mooring solutions – The Group has the capabilities to provide design, engineering, fabrication and supply, mobilisation and logistics, installation and commissioning of complete mooring solutions for depths up to 1,500 meters.
   
• Strong in-house capabilities in design, engineering and fabrication – Mooreast Holdings believes that it has an experienced design, engineering and fabrication team who has the requisite expertise and knowledge of mooring and rigging solutions. This has enabled the Group to serve customers in offshore O&G, marine as well as offshore renewable energy industries.

4. Prospects (refer to Page 149 of the offer document for a complete list of prospects)

Increasing global demand for renewable energy and offshore wind energy

• The Organization of the Petroleum Exporting Countries (OPEC) estimates that the demand for renewable energy to grow by 7.0% per annum from an average of 6.8 million barrels of oil equivalent per day (mboe/d) in 2020 to an average of 36.6 mboe/d in 2045, significantly faster than other sources of energy.
   
• The International Renewable Energy Agency (IRENA) forecasted that the global offshore wind industry will represent 17% of total global installed wind capacity of 6,044 GW by 2050.

Increasing demand for offshore wind industry in Asia and in the UK

• The offshore wind industry in Asia, excluding Mainland China, is expected to see an upsurge over the next few years, led by increasing governmental support and commitments. Governments in Japan, South Korea and Taiwan have set offshore wind capacity targets of 10 GW by 2030, 12 GW by 2030 and 5.7 GW by 2025, respectively.
   
• The offshore wind industry in the UK has seen a significant upsurge over the past few years, and as of 2020, is one of the world’s leading offshore wind markets. In October 2020, UK Government made available £160 million to upgrade ports and infrastructure to increase offshore wind capacity.

Increasing demand for solar energy in Southeast Asia

• Solar PV in Southeast Asia has been growing at a CAGR of 63.0% from 1,988 MW in 2015 to 22,845 MW in 2020.
   
• Floating Solar PV systems are expected to benefit Southeast Asian countries which generally face land scarcity and a lack of primary energy resources and associated infrastructures.

Recovery of O&G industry

• OPEC has forecasted medium-term recovery for global oil demand, while factors such as an expanding middle class, high population growth and stronger economic growth in developing countries may also drive long term global oil demand.

5. Key Risks Factors (refer to Page 32 of the offer document for a complete list of risk factors)

• Business and financial performance are dependent on the state of the offshore O&G and marine industries – A reduction in the level of activity in the exploration, development and production of oil and natural gas as a result of any changes in capital spending in the offshore O&G and marine industries may adversely affect the Group.
   
• Changes to government initiatives relating to renewable energy sources may have a material adverse effect – In recent years, various government legislation and policies have supported the use of renewable energy sources. However, if governments scale back or eliminating these support systems, the Group’s business and prospects may be adversely affected.
   
• The viability of offshore wind energy is dependent on the relative cost of oil, coal and other fossil fuels – Cheaper and large supplies of fossil fuels favour energy generation from non-renewable sources. Discovery of new and significant oil, gas and coal deposits or a decline in the global prices of oil, gas and coal and other petroleum products, could result in lower wholesale electricity prices.
   
• Business, revenues and profits may fluctuate with changes in O&G prices – A large proportion of the Group’s existing customers comprises companies operating in the global offshore O&G and marine industries and their businesses are dependent upon the prices of, and demand for O&G.

Financials & Valuation

• The Group’s total revenue grew 31% from S$15.0 million in FY2018 to S$19.7 million in FY2020, while Profit Net of Tax grew 13% from S$3.4 million in FY2018 to S$3.8 million in FY2020.
• According to the Offer Document, Mooreast Holdings’ post-invitation earnings per share (EPS) is 1.46 Singapore cents based on the audited FY2020 income statement. With an Invitation Price of S$0.22, the price-to-earnings (P/E) ratio is approximately 15.1x.

Additional Information from Offer Document (click here)

IPO Details

• Invitation price at S$0.22 per Invitation Share
• Invitation of 38.85 million Invitation Shares
  • 0.8 million Offer Shares; and
  • 38.05 million Placement Shares
• Shareholding (direct interest) immediately after the listing:
  • Feng Tai Investment Pte. Ltd* – 73.6%
  • EDB Investments Pte. Ltd. – 11.4%
  • Public Shareholders – 15.0%
• Estimated IPO Market Capitalisation of S$57.0 million based on post-invitation share capital of 259.0 million Shares
• Net proceeds approximately S$6.7 million
• Use of net proceeds:
  • S$0.5 million – Develop and grow the Renewable Energy Division
  • S$4.0 million – Development of facilities and capacity of 51 Shipyard Road and scale up of operations to cater for increased workload expected from floating wind energy prospects
  • S$1.0 million – To explore opportunities in mergers and acquisitions of strategic businesses/companies
  • S$1.243 million - General corporate and working capital purpose
     

Note: *Feng Tai Investment Pte. Ltd. is an investment holding company and its shareholders are Mr Sim Koon Lam, Executive Director, CEO and Deputy Chairman of Mooreast Holdings (60.0%) and Mrs Elaine Sim (40.0%). Mrs Elaine Sim is the spouse of Mr Sim.