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EUR 88.49
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My colleague, Toh Zhen Zhou, had earlier written about the company's background and its financial performance at the time of its previous listing attempt in 2018, Cal-Comp Tech (Philippines) Pre-IPO Review - Muted Growth in Core Products. Hence, I will not be going into too much detail about the company’s background and past performance. In this insight, I’ll talk about the updates since the past filings.
CCPH has registered stupendous growth in revenue over 2016-18 which has been accompanied by an equally impressive margin expansion. Most of this growth seems to have been driven by new contract wins from Dyson. Dyson now accounts for a bulk of the company’s revenue and probably an even higher proportion of its bottom-line. In addition, the company has also been diversifying into manufacturing of new products into 2019.
Although, it hasn’t been all gung-ho as the earnings growth has not been accompanied by commensurate growth in operating cash flows. The increasing working capital requirements have led to a drain on cash flows and an increase in leverage. Furthermore, the company remains highly exposed to a handful of customers and its sales structure leaves it exposed to related party transactions as well.
Cal-Comp Technology IPO - Getting vacuumed up by Dyson, in a good way
Cal-Comp Technology Philippines (CCPH) plans to raise around US$150m in its upcoming Philippines IPO.My colleague, Toh Zhen Zhou, had earlier written about the company's background and its financial performance at the time of its previous listing attempt in 2018, Cal-Comp Tech (Philippines) Pre-IPO Review - Muted Growth in Core Products. Hence, I will not be going into too much detail about the company’s background and past performance. In this insight, I’ll talk about the updates since the past filings.
CCPH has registered stupendous growth in revenue over 2016-18 which has been accompanied by an equally impressive margin expansion. Most of this growth seems to have been driven by new contract wins from Dyson. Dyson now accounts for a bulk of the company’s revenue and probably an even higher proportion of its bottom-line. In addition, the company has also been diversifying into manufacturing of new products into 2019.
Although, it hasn’t been all gung-ho as the earnings growth has not been accompanied by commensurate growth in operating cash flows. The increasing working capital requirements have led to a drain on cash flows and an increase in leverage. Furthermore, the company remains highly exposed to a handful of customers and its sales structure leaves it exposed to related party transactions as well.
Provider
Aequitas Research
Aequitas Research is a leading ECM research firm with a focus on IPOs and placements/follow-on offerings across the Asia Pacific with deal size of over USD100m.
Since 2015, we have covered 400+ IPOs and 450+ placements with a hit rate of 73% and 65%, respectively. We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic analysis.
Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis. We also provide a more quant driven analysis on placement/follow-on offerings.
Markets that we cover include:
Hong Kong,
China ADRs,
India,
Japan,
Australia, and
ASEAN.
Hong Kong,
China ADRs,
India,
Japan,
Australia, and
ASEAN.
Sumeet Singh
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