May 28--Qualitech Plc (QLT), a specialist in non-destructive testing and inspection for the energy and petrochemical businesses, will list on the Market for Alternative Investment (MAI) on June 9.
QLT will float 20 million shares in an initial public offering tomorrow, Monday and Tuesday.
The IPO price is set at 4.00 baht per share with a par value of one baht. Phillip Securities is the main underwriter, with Finansa Securities and Country Group Securities as co-underwriters.
The capital raised will be used to invest in non-destructive testing equipment, expanding QLT's branch in Rayong province and for working capital, said managing director Sannpat Rattakhan.
"Engineering inspection and testing have plenty of room to grow and they are necessary for industrial production," he said.
QLT is a top company in the sector. It differs from others in that the company has equal revenues from non-destructive testing, inspection and certification.
Each service has different strengths. Non-destructive testing offers growth potential, while inspection and certification services generate steady revenues from long-term contracts, he said.
These factors will drive the company's earnings even while the economy is slowing. QLT's clients are predominantly private projects that are legally required to have their equipment and services inspected. "So we're not worried about bringing QLT shares to list on the MAI at a time of gloomy market sentiment."
The company plans to expand its business overseas and is now negotiating with potential partners in the Middle East. The projects will in the oil exploration and production sectors, said Somchaan Lubtikultham, deputy managing director at QLT.
"QLT has a lot of experience and is ready to go international. Our major clients can be our good references, such as PTT, Siam Cement and Chevron. Now foreign projects generate 10 percent of total revenues," he said.
QLT is inspecting a dam in Laos which yields 5-6 million baht. Its staff has increased to 350, from 150 five years ago, and will expand to 400 within the year.
QLT had a 40 percent gross profit margin and a 20 percent net profit margin last year. It has set a sales growth target of 10 percent this year, from 245 million baht in 2008.
Phillip Securities' head of investment banking, Vicha Tomana, said QLT's price-to-earnings ratio was a low 5.6 times compared with 8 for the industry.