iWow Technology — iWow stands for “inspiring the World of Wireless” — has announced that it will raise $6.5 million to fund its plans to capture a bigger piece of the growing market for connected systems and devices.
The company, which was set up in 1999, on April 6 launched its initial public offering by placing out 26 million shares at 25 cents each. Based on FY2021 earnings per share of 1.48 cents, this issue is priced at around 16.9x historical earnings.
The sponsor and issue manager is Evolve Capital Advisory and the underwriter and placement agent is Futu Singapore. Trading will start on April 14.
Chairman and non-executive director Soo Kee Wee has a deemed interest of around 52% of the company, while CEO Raymond Bo, who began his career as an engineer with Motorola, holds around 10% directly.
“We are wireless engineers. A lot of our team are from wireless backgrounds. We are based in Singapore and we are IoT providers,” Bo says in an earlier interview.
With wireless technologies at the core, the company has found different ways to run its business. “We have two main types of business models. IoT is subscription-based, while our Smart City sector is project-based sales,” Bo continues.
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“There are many other things we do such as electronic monitoring of persons of interest. This is part of a rehabilitation programme by Singapore Prisons. In the last stage of their sentence, these persons of interest are allowed to go home on a home supervision scheme. The ankle bracelet is part of the rehabilitation programme.”
The Smart City projects include the white Trace Together token. “The design doesn’t allow the user to change the battery so we supply refurbished tokens to vending machines, and the quantity will go beyond the population of Singapore. We have a four-star cybersecurity standard which is required for the Trace Together tokens and this is why people can’t change the batteries,” Bo explains.
Some of iWow’s products are an amalgamation of its two Smart City and IoT businesses. These include the installation of smart meters for companies such as Ascendas-Singbridge (now part of the CapitaLand group), Keppel Energy, Sembcorp Industries and Senoko Power. These smart meters are installed for billing customers, Bo says. iWow services these meters, providing a stable and longer-term cash flow.
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The company also installs emergency buttons deployed in rental flats for seniors, and continues to provide services in conjunction with these installations. “We got a contract for 10,000 households [in 2021]. Seniors in trouble press the button and speak to a Ministry of Health personnel. We have more than 1,000 activations and ambulances will be dispatched,” Bo says.
In the subscription-based models for the tag for prisoners and the emergency buttons, the government pays iWow on a per person per month basis.
As at March 8, iWow has an order book of around $67.4 million with the bulk of this, $54.2 million, from the electronic monitoring system.
The company has enjoyed a big growth spurt in recent years. Back in FY2019, it was loss-making with red ink of $0.6 million on revenue of $2.1 million. The following year, it managed to break even on higher revenue of $4.4 million. For the most recent FY2021, it generated revenue of $26.4 million and reported earnings of $3.7 million.
With the IPO proceeds, Bo is looking to replenish and increase the orderbook with sales of existing products, and to grow an overseas wing. “We are working on two products: one is smart test kit which automates Covid ART testing,” he says.
The second range of products will be developed for the silver generation. “We are thinking of doing a premium version of the emergency button for consumers,” Bo adds, mulling over the potential of introducing this product to developed economies with an ageing population, in Asia and possibly Europe.
“Our [prisoner] tag, we believe, is going to be one of the world’s smallest tags and suitable for countries looking for rehabilitation by electronic means. So we are talking to Japan and they are talking about electronic monitoring for people on bail,” Bo reveals.
For the Trace Together token, Bo notes that Malaysia has announced it hopes to give out tokens to foreign workers for contact-tracing. “We have customers in Thailand, Indonesia and the United Arab Emirates,” he adds. “The world is our oyster.”