IPO Series 25 - CBH Engineering Holding Berhad - Data Center Related Stock

Figure 1: IPO timetable of CBH Engineering Holding Berhad
-Will be listed on the ACE Board

Info of IPO
Enlarged no. of shares upon listing:  1880.89 million
IPO price: RM0.28
Market capitalization: RM526.65 million
Estimated funds to raise from Public Issue:  RM83.44 million
PE ratio = 15.93x (based on FY2023)
 

Figure 2: Business model of CBH Engineering Holding Berhad
Source: CBH Engineering Holding Berhad IPO prospectus

Figure 3: Utilization of proceeds of CBH Engineering Holding Berhad
Source: CBH Engineering Holding Berhad IPO prospectus

Dividend Policy
-The group does not have a fixed dividend policy

Figure 5: Major customers and suppliers of CBH Engineering Holding Berhad in FPE2024
Source: CBH Engineering Holding Berhad IPO prospectus
 

Figure 6: Profit & Loss statement of CBH Engineering Holding Berhad

Figure 7: Financial position of CBH Engineering Holding Berhad

Figure 8: Ongoing project

Source: CBH Engineering Holding Berhad IPO prospectus

Figure 9: Industry players

Source: CBH Engineering Holding Berhad IPO prospectus
 
Financial overview, industry market, and personal opinion
-Based on the profit & loss statement, the PAT margin has increased from 5.30% to 17.20% between FY2021 to FPE2024 (8 months financial results), which translated to a CAGR of 48.05%.
-Following the independent market research report, the M&E engineering industry projects an exponential growth from 2019 to 2023. This industry comprises of heating, ventilation and air condition system, water supply and sanitation, fire protection system, utilities, and etc.
The group has expressed its involvement in the current trending sector, data centers, through the provision of M&E engineering works such as the design and construction of substations and electrical services. The involvement in the data center industry anticipates yielding a better PAT and margin in the following years.

By: Jshen Ng