From 2000 to 2012, it is not bad for a cool 12 years from 0 to a listed entity right? It took another 2 short years for OCK to upgrade herself from ACE to Main Market (20m PAT in 3-5 years with the latest financial year not less than RM6m PAT).
They are some info I would like to share for this stock.
1. 3x Cash Call in 4 Years
In a short span of 4 years of listing (2012 to 2016), she already did 2x of cash call and now calling for the 3rd round. The 3rd and latest round of cash call was announced in June 2016. What actually happened?
For a listed company, the main reason for an IPO is to sell/place out min 25% of their enlarged shareholding to raise cash (to meet the minimum 25% public spread). The cash raised should be sufficient to cater for the next few years business expansion purposes.
i. 2 years post listing, RM74m was raised through 'Private Placement' on June 2014
ii. The subsequent year, RM132m was raised though 'Right Issue' on Dec 2015
iii. The following year, they announced the 3rd round of fund raising exercise on June 2016
Extracted from Bursa Malaysia, 'Company Announcement' column;
Raising so much of funds via Equity do dilute the shares and EPS, moreover it is barely 4 years old in Bursa. Many Investment Managers definitely will raise their eye browse on this. Let's map the chronology of the fund raising:
Look at how the money flows as at 1st Quarter of 2016:
For 1st Cash Call:
There is a balance of 16.11% to be used. The mandate to utilize the money has expired on June 2016. I believe OCK has fully utilized the 100% of the 1st cash call for now.
For 2nd cash call:
There is a balance of 87.3% to be used for business expansion which I believe for Myanmar's Project.
What to look at for OCK?
Monies already spend but earnings only started to crystallized. This is to say, monies spend since year 2014 has starting to yield the positive numbers to the top and bottom line of the latest QR Report. For the funds raised in cash call 2 has yet being fully utilized. Believe it will give a further boast in their upcoming QR Reports. The overseas venture done is bearing fruits for her. During the Indonesia acquisition, it was 6000 sites, 2 years later it is 20000 sitess. Not bad at all.
The current weakening of RM against the US dollar is beneficial to her as well. What do you think for the upcoming 2nd, 3rd and 4th Quarter of 2016 numbers would be ? =)
Please refer below of the details highlighted in blue:
Do look at her Compounded Annual Growth Rate (CAGR) for Revenue and PAT (extracted from Annual Report):
Net profit has tripled for the past 5 years. From a RM9.2m to Rm27.1m. Talking about consistent high growth for her!
The consolidation of income from Seath Vietnam. Assuming 2016 yield about the same like 2015: 60% of 2015 PAT of RM7.44m will be around RM4.5m added in to the bottom line.
The additional incoming revenue from Indonesia and Myanmar. Monies raised from the upcoming placement definitely will be a great usage to improve the following few 2016 Quarterly Report results.
For those who likes to see for a longer time frame, lets look at below, it might look interesting for you. It is trading at the new high, trying to break the old resistance set in July 2014 ! Wonder what would it be in the near future ? =)
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