【The Business Hidden Above Your Ceiling】West River IPO: Why I’m Paying Attention to This Company

2025’s IPO scene is buzzing… and today we’re diving into West River.

There are only 17 hours left before the application deadline — after reading this, tell me: should we subscribe?

When I first looked into this company — West River Berhad (WESTRVR, 0353) — the name made it sound like they were into “rivers,” but the truth is, they specialize in “invisible infrastructure” that we rely on every day.

👷 What is “Invisible Infrastructure”?

Simply put, it’s everything in your apartment, office, parking lot, mall, or high-rise building that you don’t see —

air vents, ceiling ducts, switchboards, control panels, backup generators — the behind-the-scenes essentials that keep everything running.

And many of these are handled by West River.

They are a full-service M&E (Mechanical & Electrical) turnkey contractor — handling everything from design, installation, testing, to final handover.

📌 Quick IPO Facts:

– IPO Price: RM0.39

– Listing Market: ACE Market

– Market Cap: RM139.5M

– Total Shares: 357.7M

– Listing Date: 5 May 2025

✅ 1. Reputable Clients — Business Built on Substance, Not Just Stories

West River handles sizeable projects for clients like Tuju Setia, Inta Bina, Gamuda, and China State Construction — all reputable, publicly listed contractors.

This tells us two things:

– High trust factor: You don’t get big M&E contracts from these players unless you’re reliable.

– Stable orders: Their clients follow strict payment protocols and work on long-term project cycles.

✅ 2. Factory Capacity Nearly Maxed Out — IPO Funds Going Toward Expansion

Their current Kajang factory produces 1,317 switchboards a year with an average 90% utilization rate.

They plan to use part of the RM10M IPO proceeds to build a new factory and boost capacity by 300% to 3,951 units.

This isn’t just a nice-to-have expansion — space is running out. And having their own factory cuts production cost by 20%, helping margins and competitive pricing.

✅ 3. Strong Order Book — RM247M in Backlog

West River already has RM247.3 million in uncompleted contracts spread across the next three financial years:

– FYE25F: RM145.38M

– FYE26F: RM92.67M

– FYE27F: RM9.25M

This means their revenue for the next 2 years is already partially secured — they won’t be relying solely on new contracts for performance.

✅ 4. Financial Growth Is Solid — Not Just “Hot Air”

From FYE2020 to FYE2024, revenue grew from RM45.9M to RM122.7M, while net profit increased from RM3.7M to RM11.46M — a 5-year CAGR of 32.4%.

Meanwhile, net margin improved from 8.1% to 9.3%, showing better cost control and project efficiency.

✅ 5. In-House Neutron IoT System — A Glimpse Into the Future

Currently, their “smart building” segment only contributes 3.67% of revenue, but they’ve developed their own Neutron IoT system for energy management, remote control, automated lighting/AC, etc.

Although small now, with the rise of Green Building demand, this could be a future valuation re-rating catalyst.

🤓 Hidden Highlights That Might Be Overlooked:

– Dividend Habit: No fixed policy, but they’ve been paying dividends for the past five years — if cash flow remains healthy, this could continue.

– Gov’t Certified: Registered with TNB, SEDA (solar provider), and MOF — backed by official recognition.

– Low Gearing: Gearing ratio of just 0.34x in FYE24 — not overly reliant on debt.

– Reasonable Valuation: FYE24 EPS is 4.01 sen; IPO at RM0.39 = adjusted PE of only 9.7x, which is relatively low in its peer group.

❗️ Risks to Consider:

– Project-based revenue: No recurring income — they have to consistently win new contracts.

– Geographic exposure: Currently only operating in Malaysia — no overseas presence yet.

📝 My Conclusion:

West River isn’t your explosive tech-themed IPO. But it’s one of those “solid fundamentals, strong cash flow, steady execution” companies.

If you’re looking for an engineering stock with a reasonable valuation, solid order book, and legitimate expansion story — West River is worth researching.

📌 For those interested in subscribing, IPO applications are open until 17 April — just a few hours left!

You can apply via your broker or platforms like Moomoo.

🌎 Interested in apply IPO stocks with just one button?

Deposit on Moomoo using my exclusive code: NCSPACE27 to enjoy an EXTRA RM40 reward!