IPO - DUG Technology Ltd, page-26

This is an interesting project. I only went through half of the prospectus, kept wondering how could this business survive for so long. It's great that this is a scientic/tech/service project, which has its own value for the nitch. However, considering it has 317 employees and 40% of them are higher educated, the past three years' income report doesn't look promising:

How can a company with 230 clients creates only tens of thoughd $ revenue a year? Is the above report incorrectly presented? As reported in the supplement document, just a single contract for a year worths US$2.7m. Beats me.

This has to be a high expenditure business. 317 employees alone need $35m for salaries minimum. Actually you can't attract high calibre tech people with such payment in the long run. We all know how expensive the highly skilled software developers are. And the computing equipments need constant refresh and upgrade to remain competitive. Running multiple data centre requries lots of opex as well.

The IPO funds can barely support one year's expenditure IMO, considering DUG's revenue is virtually nothing (and actually at a loss).

I'll be watching from sideline with interest to see how it pans out.