IPO has been increasingly popular in the stock market in recent years especially in Year 2024, reaching 55 new IPOs in Year 2024 itself, number of IPOs much higher than average of 35 IPOs for the past few years.
Coming into Year 2025, the momentum expected to maintain and more IPOs coming. There is one confirmed IPO to be listed in the second week of January 2025. Let’s take a closer look at it!
Swift Energy Technology Berhad (“Swift Energy”) is an industrial services provider, set to be listed on the ACE Market of Bursa Malaysia early next year (8 January 2025) with the market capitalization of over RM 280 million.
The IPO application date is 9 Dec – 23 Dec 2024. The IPO price would be RM 0.28 per share, with a public issue of 250.2 million shares. Swift Energy offers a total of 25% of stakes in the company to the public, while 75% maintain with the owners and related existing shareholders. In the public issue, allocation will be as follow:
- 25.02 million new shares are allocated to the Malaysian public
- 50.04 million shares are reserved for eligible individuals
- 125.1 million shares to Bumiputera investors
- 25.02 million shares to selected investors via a private placement
A total of RM 70.06 million could be raised through this IPO which will be used to expand the business especially to facilitate its business expansion into Indonesia, which includes setting up a wholly-owned subsidiary and an office in Jakarta (40% of proceeds to be utilize). Other proceeds utilization details per below:
Business Segment
Provision of industrial automation and power systems
Process control system (PCS)
- An industrial / process control system (ICS / PCS) acts like a “brain” that manages machines and processes in factories. It tells machines when to start, stop, speed up, or slow down — similar to how traffic lights control cars. Working automatically based on pre-set instructions, it doesn’t need human intervention and sends real-time updates to a control room so workers can monitor operations.
- These systems are used in places like cookie factories, oil refineries, and power plants to ensure efficiency, accuracy, and safety. For example, they control conveyor belts, oven temperatures, and packing machines in food production, while in oil refineries, they manage pressure, temperature, and flow.
- By automating processes, ICS / PCS increases production speed, maintains consistent product quality, and detects issues early to prevent accidents — much like a smart home system controlling appliances, but on a larger, more complex scale.
Explosion-proof solar photovoltaic (solar PV) systems
- An explosion-proof solar PV system is a solar power solution designed to operate safely in hazardous environments with flammable gases, vapors, or dust. It prevents sparks, heat, or electrical discharges, meeting safety standards like ATEX and IECEx to ensure safe use in high-risk areas.
- These systems are used in places like offshore oil rigs and petrochemical refineries to power lighting, sensors, and monitoring devices. They provide a safe, renewable energy source while reducing reliance on traditional power systems.
Power distribution system (PDS)
- Think of a power distribution system like a network of pipes delivering electricity instead of water. For homes and businesses, it’s a simple network that sends power to things like lights and air conditioners. But in factories, it’s much more complex because it also needs to power big machines and equipment.
- When electricity enters the building, it first goes to a main control board (called a switchboard), which directs it to the right places. For big factories, the electricity comes in at a higher voltage to power larger equipment, and there are safety systems like circuit breakers that stop the power if something goes wrong, protecting both machines and people from harm.
Other related systems
- Distributes / Supply of related products and services
- Power and industrial electrical products
- Technical services for systems rendered
Industry Coverage
- Oil and gas (O&G)
- Grain products, edible oils, food manufacturing
- Utilities
- Others (Marine, mining, pharmaceutical, construction, industrial trading, and other general industries
Geographic Markets
- Major markets: Malaysia, China, Thailand, Singapore
- Other markets: South Africa, Indonesia, Ghana, Papua New Guinea, Vietnam and others
*Serve around 550 customers across 29 geographical markets.
The financial performance of Swift Energy is also on eye for FYE 2021 – FYE 2023. Revenue has been growing rapidly at near to 65% for 2 years period from RM 56.12 mil to RM 92.43 mil. Malaysia operations has been the largest revenue contributor of over 40% out of total revenue of the company, and the rest filled up by operations from Thailand, Singapore, China and others.
Now, let us zoom into who are the major shareholders of the company:
Top 1 shareholder: Blueprint Capital Sdn Bhd
- Controlled by Swift Energy Executive Director cum Chief Executive Officer – Mr. Tan Bin Chee and corporate affairs director Suzana Abu Bakar
- Will be holding 31.6% shares post-IPO listing, a drop from the current 47.5%.
Top 2 shareholder: Mr. Tan Bin Chee
- Swift Energy Executive Director cum Chief Executive Officer (CEO)
- Will be holding 27.8% post-IPO listing, a drop from 37.07% pre-IPO shareholding.
Top 3 shareholder: Mr. Chin Saw Yong
- Swift Energy Executive Director cum Chief Operating Officer (COO)
- Will be holding 10.6% of shares post-IPO listing, current shareholding is 15.43%.
Advantages:
- Swift Energy has foreign operations out of Malaysia, which including Singapore, Thailand and China to cater for larger exposure and opportunities, post-IPO will be adding in Indonesia.
- Swift Energy is the only IECEx-certified manufacturer for Ex solar PV modules, Ex switchracks, Ex battery chargers, Ex battery enclosures and Ex solar controllers in Malaysia.
Disadvantages:
- Swift Energy’s future growth will depend on its ability to win more projects both in Malaysia and abroad due to very less recurring projects.
- It’s also worth noting that demand for its products and services can be influenced by its customers’ capital expenditure plans, especially O&G, edible oils and food manufacturing industry, which is something investors should keep an eye on.
- Swift Energy has no long-term agreement / contract with their customers.
- Exposed to foreign currency exchange risk.
Last but not least, let us take a look at Swift Energy competitor in the market. There are 2 competitors who are listed company in Malaysia stock markets, they are Willowglen MSC Bhd and Powerwell Holdings Bhd. If we are to look at the GP margin and NP margin based on the latest financial year end, Swift Energy is the highest among the 3 companies.
Willowglen MSC Bhd, Powerwell Holdings Bhd, and Swift Energy Technology Berhad serve different niches with some overlap. Swift Energy, certified under IECEx, provides energy solutions for hazardous environments in the oil and gas sector, which sets it apart. Swift Energy’s IECEx certification for explosive atmospheres distinguishes it from the other two companies.
In short, the nature of business of Swift Energy can be said to be an engineering company, due to one-off project and it really depends on the company itself to continue looking for more projects and opportunities.
Undoubtedly, the company’s revenue and profit for the past 3 years has been growing tremendously and the PBT & PAT margin also improving from 7.12% to 15.67% and 6.52% to 13.2% respectively.
However, as an investor who wishes to stay long with the company, has to monitor closely on the company’s future plan of growing.