Grand Venture Technology Limited announced that it's IPO Garner "STRONG SUPPORT" in its Press Release. 42,918 mil shares was 1.3x subscribed. Public shares was oversubscrib at 12,568 mil shares at 15.66x. The IPO write up is here.
Grand Venture Technology Limited commence trading today with SGX name Grand Venture and code JLB. Grand Venture opened on the Catalist board at S$0.27 below its IPO price of S$0.275 a share on Wednesday and close at S$0.270 a share.
The first IPO for 2019. Hope It's a good start for the new year.
Grand Venture Technology Limited is offering 42.918mil shares for its IPO on Catalist at $0.275 per share. These comprise a public tranche of 800,000 shares and a placement tranche of 42,118,000 shares. The IPO will close on 11th Jan 2019 at 12 pm and starts trading on 23rd Jan 2019. The market cap for this IPO is $64.4mil.
Company Overview
Established in Singapore in 2012, Grand Venture Technology (“GVT”) is a trusted manufacturing solutions and services provider for the semiconductor, analytical life sciences, electronics and other industries. Backed by a highly experienced management team, GVT delivers engineering, assembly, testing and product life cycle management solutions. GVT operates out of its facilities in Singapore, Malaysia (Penang) and the PRC (Suzhou) to serve a portfolio of customers that are some of the largest OEMs in these industries.
What's their business
GVT provide manufacturing solutions and services provider for the semiconductor, analytical life sciences, electronics and other industries.
CVT Business
How do GVT fare in the business
Financial Hightlights
Key Profit and Loss
The loss in FY2015 is due to low production volume as GVT is fulfilling the audit and accreditation process to be an approved vendor and to clear first articles inspections of certain new customers and products. FY2016 GVT ramp up their production causing the gross profit to increase.
GVT is listing at PE ration of around 11.2 PE and $0.078 NAV which is quite expensive compare market cap to equity.
What is good about GVT
Good range of products from small high-precision components to large structural components.
10-year agreement with SICO Technology GmbH and Sico Asia Quartz Pte Ltd to build up quartz and ceramic machining capabilities which not much competitions in the market with the knowledge.
Track record in optimizing operations, implementing strategic plans and creating shareholder value
Losses in FY 2015, other than that YoY is making profit and new components are in production for better margin.
What is not so good about GVT
Small pool of major customers and they accounted for an aggregate of 78.7%, 92.3%, 89.7% and 94.8% FY2015, FY2016, FY2017 and HY2018 respectively.
Raw material prices for aluminium and stainless steel fluctuate and will have a significate impact on P&L.
Conclusion
At an expensive listing price, I feel that It's not worth to invest and the risk of raw materials supply and pricing. The profit margin might not be as current and might see a big drop compare to current profit margin.
As the new year start, It means that my CPF will be collecting interest for the balances in 2018.
2019 is the year that I cross over to 35 years old which mean my OA contribution will be reduced and adjusted towards SA and MA. Which I think is a good move as It's preparing me towards retirement and allowed me to earn 5% interest without risk.
Photo from CPF
For the interest of 2018, CPF paid me a total of $4309.12 across all three accounts. Unfortunately, my OA is almost empty and not earning much interest due to the mortgage loan which I still have to serve for another 27 years.
No place to park your excess funds and want a flexiable place to park while gain a decent yield. SSB is the place for you to park your funds.
February 2019 SSB give an average interest rate of 2.2% over the next 10 years and can be applied thru DBS/POSB, OCBC and UOB ATMs and Internet Banking. This bond will be reflected as "SBFEB19 GX19020V" in your CDP statement and "CDP-SBFEB19" in your bank statement.
