Kingdom Gaz

Industry

Energy

Asset Class

Private Equity

Value of Investment

$5 Million USD in 500 Subscription Units
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Aug 24th ; Kingdom Gaz has been selected by an American power company as the sole supplier of LPG for a power generation plant project it is planning to undertake. The company is currently visiting Cambodia to secure Power Purchasing Agreements with the local government, finding a suitable location near a transition line, and developing a facility on the Mekong river to receive 800-1000 metric tons of LPG in barges. Upon completion this will be another strong recurring source of revenue for Kingdom Gaz. Kingdom Gaz sales will surge from the newly introduced fleets of LPG tuktuk taxis growing from the massively popular PassApp ride hailing App. This high level of LPG conversion has opened a huge new market segment for Kingdom Gaz which should take revenues over $100 million. Trending development- a 15 acre parcel of land on the Mekong River has been identified to be developed into a LPG import terminal to significantly reduce shipping costs compared to overland trucking.

Energy Giant & Trading Co., Ltd., was established in Cambodia in 2011 with the objective of becoming market leader in the import, distribution, wholesale and retail of LPG in Cambodia and neighborhood countries, Vietnam and Laos. The company owns the Kingdom Gaz brand, recognized by the market as the leading brand.

EGT Holding (HK) Limited (“EGT”) acquired 100% of the interest into the Cambodian company in 2017 to develop the business regionally and organize an IPO. 

The funds raised through this offering will be used to increase  working capital for our core bulk operations and to acquire infrastructure and hard assets such as trucks to meet additional demand from existing and new customers. 

Funds will also be deployed into the 2 new segments of the market: wholesale and retail, through the acquisition of vehicles and equipment such as lorry trucks, cylinders, filling pumps, but also to hire staff and to develop a country-wide marketing campaign to promote the new products and services.



Current State of the Company

• EGT started operations in early 2012 with seed capital of US$515,000, fully licensed, with a small team and one truck.

• We have increased our activities from 50MT/month to a comfortable recurring minimum 2,000MT/month, ready to absorb increasing volumes with additional working capital.

• We started in the 3 main provinces: Kampong Cham, Siem Reap and Battambang, Kingdom Gaz has now a strong reach in large cities and key roads.

• To date, a network of over 120 reliable and returning customers, wholesalers and retailers.

• The CEO is very much hands-on and supported by an active, loyal and dedicated team of 15.

• EGT owns trucks of 15MT and 22MT as well as storage tanks and wholesale facilities.

• The company has already prepared the steps to penetrate the other tiers of the market, the
plan is backed by commitments and can be implemented directly after raising capital.

• The brand is well known and vehicles our values: integrity, quality, safety, customer focus.

Growth

• Energy Giant & Trading Co., Ltd. is facing strong demand from customers, in core and new segments and needs capital to absorb the demand.

• The Company is benefiting from growth in LPG demand, but is also encouraged to supply more customers.

• Because of the company’s impeccable reputation and quality in service, customers are encouraging us to develop into new segments: wholesale and retail.

• GDP growth, urbanization, increasing of living conditions, governmental subsidies and foreign aid are all supporting the switch from coal and wood to LPG.

• LPG is now the fuel of choice, with high vehicle conversion rates (most of taxis, many private vehicles) and rural consumers switching to LPG as well. The market is huge and the potential remains very strong.

• In a nutshell: our market share is growing in a growing market.

• We anticipate to reach annual sales of US$ 80 Million within 3 years making EGT the number one LPG company in the country.


Enhancing Margins

• With the current limitation due to lack of working capital, the Company is unable to absorb the demand, that we anticipate to be at least 2 times the current bulk volumes. With little marketing and sales activities, we believe EGT will achieve a 100% growth in sales in 2018, with additional working capital.

• The Company is entering new tiers of the market in order to improve its net margins, since Tier 2 and 3 offer better margins, despites higher operating costs. EGT is, as well, always employing cost-awareness methods in order to keep the activity as profitable as possible.

• The rise in import volumes provides higher margins due to economies of scale.

 

Next- Kingdom Port

• EGT has very good relationships with suppliers but depends on them.

• EGT has already diversified sources of supply, buying locally and from Vietnam, but EGT wants to organize its own import of LPG. EGT is fully licensed to import LPG by sea or river and plans to launch an infrastructure project Kingdom Port. EGT wants to develop a mixed-use port facility to import, unload, store, and load on trucks LPG in large quantities. The use of its own port will significantly cut transportation costs and lead to increased margins and volumes.

• The port itself is subject to additional financing (equity and debt) and will be developed jointly with an operator and developers.

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