PETALING JAYA: ACE Market-bound Haily Group Bhd, which is involved in the construction of residential and non-residential buildings in Johor, is anticipated to record steady earnings growth, supported by its healthy unbilled order book.
TA Securities in a report said it expects the group to record earnings growth of 2.9%, 17.4%, and 12.1% to RM10.5mil, RM12.3mil and RM13.8mil, respectively, from 2021 to 2023.
“We expect the group to register a decent earnings growth in 2022 and 2023, as we believe all the economic activities in Malaysia will fully operate next year, given that the government is actively pushing to expedite the nationwide vaccination programme.
“The Johor market is expected to remain the leading revenue generator for the group.”
TA Securities said it is projecting order book replenishment assumptions of RM150mil, RM180mil and RM200mil for three consecutive years from 2021 to 2023.
“Generally, we are optimistic on the outlook for Haily as the group is backed by a healthy unbilled order book of RM249.6mil as of June 10, 2021, translating into about 1.5 times 2020 revenue.
“The unbilled order book comprises 18 construction projects for residential and non-residential and two civil engineering projects. This would provide earnings visibility to the group for the next two years.”
Haily was founded by See Tin Hai and his wife Kik Siew Lee.
The company, which will be listed on July 21, launched its prospectus on June 30 and aims to raise RM20.4mil from its initial public offering (IPO) exercise.
The IPO entails a public issue of 30 million shares at RM0.68 each and will be closed for application today.
Of the 30 million shares, it is offering 8.92 million shares to the public, 10 million to eligible directors, employees and persons who have contributed to the group’s success, and 11.08 million to selected investors by way of a private placement.
Additionally, there will be an offer for sale by its promoter that involves 18 million existing ordinary shares in Haily by way of a private placement to selected investors. Its promoters are Haily Holdings Sdn Bhd, See and Kik.
TA Securities Holdings Bhd is the principal adviser, sponsor, underwriter and placement agent in relation to the IPO.