Geohan Corporation Berhad IPO's Analysis
Geohan Corporation Berhad
Geohan Corporation Berhad, through its subsidiaries, is principally involved in the provision of foundation and geotechnical services, as well as other related construction services in Malaysia. The Group's services focus on activities below ground level, providing stable foundations for buildings and infrastructure. Its offerings include a comprehensive range of foundation works such as piling (bored, caisson, micropile), earth retaining structures, and sub-structure works. It also provides geotechnical services like slope stabilisation and ground improvement. Additionally, the Group is involved in hiring out equipment and machinery, and the wholesale of construction materials. The Group was formed through a series of acquisitions and has key operational hubs including a headquarters in Kuala Lumpur and a depot facility in Selangor. It also has a subsidiary incorporated in Singapore, Geohan Pte Ltd, to facilitate expansion into the Singaporean market.
IPO Details
Market:
Main
Principal Adviser:
Alliance Islamic Bank Berhad
Issuing House:
Malaysian Issuing House (MIH)
Shariah Status:
SC (Yes)
Listing Price:
0.55
MITI allocation?:
Yes
Closing Date:
21-Nov-2025
Balloting Date:
28-Nov-2025
Listing Date:
05-Dec-2025
Oversubscription rate:
7.78x
Average Analysts FV
:
Public Invest (0.65), RHB (0.64), TA (0.67), Mplus (0.66)
iSaham IPO Score
:
Market Cap:
242.00 M
Number of Shares:
440.00 M
( info)
Median Sectors PE:
N/A
Median Peers PE:
Strategic Overview & Data Visuals
Utilisation of Proceeds
| Purpose | Amount (RM'000) | % | |
|---|---|---|---|
| Expansion | Capital expenditure | 40,000 | 55.1 |
| Working capital | Working capital | 25,600 | 35.26 |
| Listing expenses | Estimated listing expenses | 7,000 | 9.64 |
| Total | 72,600 | 100 | |
Analyst Highlights
| Date | Analyst Highlights |
|---|---|
|
21-Nov-2025
Mplus |
|
|
20-Nov-2025
Public Invest |
|
|
20-Nov-2025
TA |
|
|
19-Nov-2025
RHB |
|
Utilisation of Proceeds
Business Segments
Geographical Segments
Major Customers
Revenue by Financial Year Ended
Profit After Tax (PAT) by Financial Year Ended
Revenue by Financial Period Ended
Profit After Tax (PAT) by Financial Period Ended
SWOT Analysis
Strengths
- High-Rise Residential Specialist: Geohan has established a strong foothold in the Klang Valley high-rise segment with Tier-1 clients like Sunway and Mah Sing, providing a steady baseline revenue stream that cushions against infrastructure project volatility.
- Profit Margins: Geohan maintains a healthy 5.9% net margin, significantly outperforming peers like Aneka (-1.7%) and Econpile (0.4%), proving operational efficiency without sacrificing profits just to win volume.
- Previous Experience in Singapore: Having successfully delivered the Jurong East MRT modification (2009-2011) proves to Singapore regulators (BCA/LTA) that Geohan is technically capable, even if they have been away for a while.
Weaknesses
- Zero Singapore Projects: Unlike Pintaras Jaya which generates ~84% of its revenue (RM311 million) from Singapore, Geohan holds zero active contracts there, making entry high-risk against such a dominant incumbent with established economies of scale.
- Valuation Premium Risk: Listing at a PE of ~16.9x makes Geohan more expensive than its closest peer Pintaras (PE 8.7x)—which already generates ~84% of revenue from Singapore—potentially deterring value investors who prefer companies with a proven overseas track record.
- Short-Term Order Visibility: With an order book coverage of 0.99x, Geohan trails behind direct peers like Pintaras (1.01x), Aneka (1.32x) and Econpile (1.19x). The breakdown reveals a massive revenue drop-off by FY2027 (only RM17m secured), creating urgent pressure to replenish the order book immediately post-listing.
Opportunities
- Increased Operating Capacity: A significant portion of the IPO proceeds (55.10%) will be used for capital expenditure to purchase new machinery, including rotary boring rigs, crawler cranes, and excavators. This expansion is expected to increase operating capacity, enhance efficiency, and reduce reliance on rental machinery.
- Favorable Industry Outlook: The construction industry in Malaysia is experiencing continuous growth, driven by demand for properties and government-led infrastructure projects. This provides a steady pipeline of potential projects for foundation and geotechnical services.
- Singapore Infrastructure Boom: Massive demand from Changi T5, Data Centers, and MRT lines creates "spillover" opportunities for Geohan to win sub-contracts that incumbents like PTARAS or CSC cannot fulfill alone.
Threats
- Industry Cyclicality: The company's performance is heavily dependent on the cyclical nature of the construction industry, which is influenced by economic conditions, government policies, and market sentiment. An economic slowdown could reduce demand for its services.
- Material Price Volatility: The business is subject to fluctuations in the prices of key building materials like ready-mix concrete and steel bars. As contracts are often on a firm-price or lump-sum basis, the company may be unable to pass on increased costs to customers, potentially leading to cost overruns and reduced profitability.
- Intense Competition: The foundation and geotechnical industry is specialized and competitive. The company faces competition from other established players in Malaysia and will face new competitors in Singapore, competing on technical expertise, track record, and pricing.
- Profitless Revenue Risk: If desperate to refill its order book, Geohan risks underbidding for projects, potentially mirroring Aneka’s scenario of winning high-volume contracts but suffering net losses due to cost overruns.
Key Highlights
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Conclusion
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