TL;DR
- Procurri resumed trading following a share placement to meet the regulatory free float requirements.
- The company’s revenue growth could slow down with a muted corporate tech spending outlook, as well as a trickling return to offices in the US.
- In addition, its margins could remain weak as tight labour markets in the US and Europe drive up wage costs.
- Procurri is trading at 10x FY21 EV/EBITDA, 37x FY21 PE and 1.4x price to book.
What happened?
Procurri resumed trading on 18 Jan 2023 after completing a share placement of 21m new and 6m old shares. This was to meet the exchange’s 10% free float requirement. Its share price promptly fell by 26.8% on that day to S$0.30, the placement price.
Free float is now 10.1%, or 31.9m shares. This is still small, in our view. Declout Pte Ltd owns the balance 89.9% of the company.
Procurri distributes, refurbishes, recycles and resells used IT hardware and data centre assets. It also provides third-party maintenance services....
