Marine Construction Stock IPO, Benalec Holdings Berhad

Benalec Holdings Bhd, Malaysia’s second largest marine construction firm, is schedule to be listed in Main Market on 17th January 2011. The company, was established in 1978 is also eyeing to expand its marine construction services regionally especially in Indonesia and Vietnam.

Benalec’s IPO consists of a public issue of 100 million ordinary shares at an IPO price of RM1.00 per share with RM0.25 par value.

36.5 million shares will be allocated for the Malaysian public, 57 million shares for private placement and 6.5 million shares for eligible directors, employees and business associates of the group. On top of that 130 million shares will be allocated for placement to identified investors.

The IPO will raise in RM100 million in proceeds for working capital to take on bigger jobs for which they are bidding. As of Dec 2010, Benalec has a total order book amounting to some RM855 million, of which RM664 million is unbilled and will last until 2016. Currently, Benalec tenders for projects collectively worth about RM1 billion.

Benalec adopted a dividend policy of paying between 15 and 30 per cent of group net profits to shareholders. At an IPO price of RM1.00 per share, the net dividend yield is estimated to be approximately between 1.2 to 2.4 per cent for financial year end 2010.

Benalec profit after tax for financial end 2010, is RM58.4 million up from 17.3 million in 2009 and 13.4 million in 2008.

Currently, Benalec has a fleet of 91 vessels to support its operations and their shipyard is located in Sijangkang.

AmInvestment Bank Bhd is the adviser, sole underwriter and sole placement agent of the IPO.

For those who are interested in Benalec IPO you may subscribed at ATM machines or via Internet Banking. The subscription period is opened until 6th January 2011.

View Benalec Holdings Bhd prospectus in Bursa Malaysia webpage. Benalec Holdings Bhd stock name in Bursa Malaysia is “BENALEC”.

Another, interesting IPO to subscribe. Dividend is on the low side but the profit after tax growth is very good.

What do you think about Benalec IPO? Are you going to subscribe?

7 comments… add one
  • What is the PE ratio for Benalec holdings please?

  • Based on my calculation it is approximately 12.50 for 2010.

    • Am invest has placed a fair value of RM1.90, probably because they are the underwriters.Would you recommend to subscribe?
      Thank you

      • Hi, for me I would like to subscribe because I can see that for previous 2 years, the growth is very good. They also will pay dividend but on low side.

        PE also not so high & gearing ratio is at 0.41.

  • what is the expected price for benalec?how about kssc & tilb ?

  • Hi tini, I don’t have target price for these IPOs except RM1.90 for Benalec by AmResearch as point out by Ramakrishnan. However, I am interested in Benalec & Tambun Indah.

    • At 5.00 pm closed for IPO Benalec. Wish, i can get full my application.
      Benalec paid dividen is very high 30% to investors.


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