KUMPULAN KITACON BERHAD

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Open to apply: 28/12/2022
Close to apply: 09/01/2023
Balloting: 11/01/2023
Listing date: 17/01/2023

Share Capital
Market cap: RM340mil
Total Shares: 500mil shares
Industry CARG (2017-2021)

Value of building construction work completed by sectors
1. Malaysia (residential) CAGR: -9.1%
2. Malaysia (non-residential) CAGR: -6.8%
3. Selangor (residential) CAGR: -7.5%
4. Selangor (non-residential) CAGR: -7.9%

Industry competitors comparison (net profit%)
Kitacon: 9.2% (PE8.1)
Kerjaya: 9.9% (PE13.04)
MGB Bhd: 4.5% (PE14.31)
Nestcon: 3.4% (PE30.56)
Inta Bina: 3.5% (PE11.81)
Vizione: -28.9% (PE-1.37)
TCS: 1.2% (PE-10.45)
Gagasan: 3.7% (PE-29.04)
Haily: 5.0% (PE8.74)

Provision of construction services
Residential: 84%
Non-residentail: 16%
Principal Market
Selangor: 96.8%
Negeri Sembilan: 1.6%
Johor: 1.6%

Fundamental
1.Market: Main Market
2.Price: RM0.68
3.P/E: 8.1 @ RM0.084
4.ROE(Pro Forma III): 21.09%
5.ROE: 22.69%(FYE2021), 14.96%(FYE2020), 22.42%(FYE2019)
6.Net asset: RM0.496
7.Total debt to current asset after IPO: 0.48 (Debt: 190.583mil, Non-Current Asset: 42.890mil, Current asset: 395.501mil)
8.Dividend policy: Propose 25% PAT dividend policy.
9. Shariah starus: Yes

Past Financial Performance (Revenue, Earning Per shares, PAT%)
2022 (FPE 30Jun): RM234.733 mil (Eps: 0.052),PAT: 11.1%
2021 (FYE 31Dec): RM455.502 mil (Eps: 0.084),PAT: 8.40%
2020 (FYE 31Dec): RM489.645 mil (Eps: 0.078),PAT: 7.80%
2019 (FYE 31Dec): RM581.523 mil (Eps: 0.110),PAT: 9.40%

Order book
FYE2022: RM104.961 mil
FYE2023: RM617.578 mil
FYE2024: RM131.070 mil

Operating cashflow vs PBT
2022: 87.83%
2021: 154.0%
2020: 84.9%
2019: 44.6%

Major customer (2022)
1. Sime Darby: 25.3%
2. Tropicana Aman Sdn Bhd: 14.8%
3. QLB: 11.4%
4. SP Setia Group: 10.2%
5. Symphony Hills Sdb bhd: 8.8%
***total 70.5%

Major Sharesholders
Tan Ah Kee: 8.4% (direct)
Teow Choo Hing: 28.9% (direct)
Suan Neo Capital: 35% (direct)

Directors & Key Management Remuneration for FYE2023 (from Revenue & other income 2022)
Total director remuneration: RM5.095mil
key management remuneration: RM2.10 mil - RM2.50 mil
total (max): RM7.595mil or 9.39%

Use of funds
1. Purchase of Aluminium formwork systems: 34.8%
2. Purchase of Scaffoldings and cabins: 11.6%
3. Purchase of land and construction of a storage and refurbishment facility: 38.7%
4. Working capital: 6.3%
5. Listing Expenses: 8.6%

Conclusions (Blogger is not wrote any recommendation & suggestion. All is personal opinion
and reader should take their own risk in investment decision)
Overall is a high risk IPO due to overall weak performance & challenge of the industry
environment cause the difficulty for the company to growth. The order 2022 like unable to break revenue in 2021, but order book in 2023 likely will have better result compare 2022.