IPO Watch: UK engineering play SRJ is paving its way to the ASX
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UK-based Engineering firm SRJ Technologies has mapped out its plans to list on the ASX before the end of this year, starting with a $5m seed raising.
The company develops a range of weld-free products for pipe repair and replacement for a number of industries including oil and gas.
The IPO is part of SRJ’s plan to rapidly accelerate growth in Australia and other markets.
“A significant portion of our future revenues is forecast to come from the Australian market as we continue to grow and design new products for the oil and gas industry,” CEO Alexander Wood said.
“We see this listing as a critical step towards capitalising on our current global supply agreements and entering new markets internationally.”
SRJ recently inked a global supply agreement with oil and gas engineering conglomerate EnerMech, which has operations in Australia, as well as a manufacturing deal with a WA company.
Wood told Stockhead that SRJ expected to see high single to double-digit growth in the overall pipeline market due to the increasing demand for crude oil and natural gas in developing countries.
“Whilst undoubtedly a positive for SRJ given we can provide both product solutions and asset integrity solutions for new capital expenditure projects, there are other factors that we look at when it comes to growth opportunities,” he said.
“If we take Australia as a case study here, which can be replicated across the globe, much of the original pipelines are of an age where significant maintenance projects are required to ensure continued asset integrity.”
Wood said fugitive emissions, local content requirements, lead time pressures and safety concerns were all areas of concern for the Australian industry.
“The demand for digitisation of product solutions also continues to gather pace as the industry strives to gain greater operational efficiencies, and SRJ are currently developing a digital coupling with the ability to monitor process flow parameters,” he said.
“Installing products faster, that are safer, smarter and ultimately more cost efficient is an attractive proposition for the market that will drive our growth.”
SRJ’s current forecast for 2019 is $US6m ($8.5m) in revenue, with $US4m already booked or under negotiation.
Perth stockbroking firm CPS Capital has been appointed as lead manager of the pre-IPO raising.
SRJ is aiming for a Q4 listing.