PETALING JAYA: Swift Energy Technology Bhd, an industrial automation and power systems provider, aims to raise RM70.06 million from its initial public offering (IPO) by issuing 250.2 million new shares at a price of 28 sen each in conjunction with its listing on the ACE Market of Bursa Malaysia.
With about one billion (1,000,800,000) shares after the IPO, the company’s market value will be RM280.22 million.
Out of the RM70.06 million to be raised, 40% of the proceeds will be allocated for the expansion of its fabrication facility, storage, office, and the establishment of a new research and development (R&D) centre in Shah Alam. It will use 21.4% to repay borrowings, 19% for working capital requirements, 8.6% to cover its listing expenses, 3.1% to purchase machinery, equipment and software, while 2.1% is earmarked for setting up a dedicated R&D centre to drive innovation.
In addition, 5.8% of the proceeds will support the group’s business expansion into Indonesia, including the establishment of a wholly owned subsidiary and an office in Jakarta.
Swift Energy CEO Tan Bin Chee said its offerings, including process control, Ex Certified Solar PV Systems (solar PV systems that are rated explosion-proof and are typically installed in hazardous or potentially explosive locations), and power distribution systems, support critical sectors such as oil and gas, grain products, and food manufacturing industries.
“For instance, we have witnessed significant growth in the demand for our Ex solar PV systems in the past few years, arising from the global shift towards sustainability and renewable energy within the oil and gas industry, evident in commitments as announced in the National Energy Transition Roadmap net zero emission target by Petroliam Nasional Bhd in Malaysia and PTT Exploration and Production PCL’s net zero greenhouse targets in Thailand,” he said at the prospectus launch today.
As for grain products and food manufacturing, Tan said food security remains a key factor for countries such as China and, more recently, the African region, where there is a high demand for solutions that enable the strengthening of their basic food supply chain.
“From our roots in Malaysia, we have expanded across key regional markets, and our global presence reflects our resilience, growth, and ability to deliver world-class solutions tailored to diverse industries,” he added.
Swift Energy recorded a compound annual growth rate of 28.3% in revenue between the financial years ended 2021 and 2023. In FY23, the group achieved revenue of RM92.43 million, compared to RM56.12 million in FY21.
Group profit after tax margin rose from 6.5% in FY21 to 14.3% in the latest nine-month financial period ended Sept 30, 2024 (FPE 2024).
The group’s provision of industrial automation and power systems segment contributed 80.7% to its revenue in FPE 2024, of which 27.8% was from Ex solar PV systems, followed by 25.3% from power distribution systems, 25% from process control systems, and the remaining 2.6% from other Ex systems.
Notably, Ex solar PV systems have shown significant growth in the past three years, growing from RM7.2 million in FY21 to RM24.8 million in FY23. For FPE 2024, Ex solar PV systems recorded RM22.6 million.
In Malaysia, Tan said, the company’s Ex solar PV systems competes with overseas manufacturers who conduct business through local agents.
“As of now, we believe we are the number one player in Malaysia for Ex solar PV systems, both in terms of contract value and the number of platforms. We also hold a dominant position in Asean,” he said.
“In FY23, we completed 18 platforms, while the entire Malaysian market saw only 10. We’ve also secured additional platforms abroad, including in Thailand. We are a regional player, not just Malaysia-centric.”
The company’s shares have been classified as syariah-compliant by the Shariah Advisory Council of the Securities Commission Malaysia. Swift Energy’s listing is scheduled for Jan 8, 2025.
M&A Securities is the principal adviser, sponsor, underwriter, and placement agent for Swift Energy’s IPO.
