From left: WTEC Group Bhd non-independent non-executive director Eu Tiong Nam, WTEC group executive director Andy Tiow See Yen, WTEC group managing director Tan Kok Kheng, WTEC independent non-executive chairperson Teresa Tan Siew Kuan, Alliance Islamic Bank Bhd chief executive officer Rizal IL-Ehzan Fadil Azim, Alliance Bank group chief corporate & institutional banking officer Teoh Chu Lin, Alliance Islamic Bank Bhd head / senior vice president, corporate finance, Islamic capital markets Tee Kok Wah.
PETALING JAYA: TA Research has set a target price of 28 sen for ACE Market-bound WTEC Group Bhd
, indicating a 12% upside from its initial public offering (IPO) price of 25 sen per share.
The research house stated that the valuation is based on a price-to-earnings ratio (PER) of 12.7 times its forecasted financial year 2025 (FY25) earnings per share (EPS).
“The assigned PER of 12.7 times reflects a 10% discount to the weighted average PER of comparable regional peers in the sector, taking into account WTEC’s smaller market capitalisation,” it noted.
At an IPO price of 25 sen per share, WTEC is valued at a PER ratio of 12.8 times its FY24 core EPS, with a market capitalisation of RM120mil.
WTEC manufactures and trades foam and non-woven fabric products used across various industries, including automotive, electronics and construction.
Its products include seat padding, electronic insulation materials, and technical foams.
In FY24, WTEC posted RM52.03mil in revenue and a net profit of RM8.2mil, with a gross margin of 38.6%.
The automotive industry contributed around 36.1% of its revenue, while 33.4% came from the electrical and electronics sector.
Geographically, Malaysia accounted for 76% of WTEC’s sales, followed by Vietnam at 12%, with smaller contributions from Australia, Thailand and other export markets.
The company plans to raise RM22.54mil from the IPO. Of that, RM9.42mil or 41.8% will be used to purchase and renovate a new factory, while RM3mil or 13.3% is allocated for new machinery and equipment.
The subscription for WTEC’s IPO shares closes today, with the stock slated to be listed on April 29.
