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29-07-2015, 08:28 AM
(This post was last modified: 29-07-2015, 05:03 PM by CityFarmer.)
Choo Chiang Holdings Ltd. (“Choo Chiang” and together with its subsidiaries, the “Group”), one of Singapore’s largest and leading suppliers and retailers of electrical products and accessories, today announced that its initial public offering (the “IPO” or the “Invitation”) of 33.28 million shares (the “Invitation Shares”) at S$0.35 per share has received positive interest from investors. CIMB Bank Berhad, Singapore Branch is the Sponsor and Issue Manager and CIMB Securities (Singapore) Pte. Ltd. is the Underwriter and Placement Agent for this IPO. The Invitation comprises 33.28 million Vendor Shares. As at the close of the Invitation at 12 noon on 27 July 2015, there were 704 valid applications received for the 1.0 million Offer Shares available to the public for purchase. In total, an aggregate of approximately 43.28 million Offer Shares were applied for by the applicants, with total application monies received amounting to approximately S$15.15 million.
Lai liao lo... Huat big~~!
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New thread created, after the success of the IPO
Thanks
Regards
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I thought the IPO is over-priced, considering the business and profits have not been able to grow much in the last 2 years, and the construction industry which feed the business is not expected to do much better in the next few years.
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The company is at a bad year, immediately after the IPO...
Choo Chiang posts 43.3% fall in 1H earnings to $2.2 mil
SINGAPORE (Sept 3): Electronic appliance distributor Choo Chiang Holdings posted a 43.3% fall in earnings to $2.2 million in its maiden six months financial results ended June.
The weaker bottomline came on the back of a 9.9% fall in revenue to $31.6 million.
Choo Chiang blames the fall in revenue to a reduction in selling prices for the group's electrical products and accessories, in an effort to maintain price competitiveness.
...
http://www.theedgemarkets.com/sg/article...ngs-22-mil
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Choo Chiang Holdings Ltd. (the “Company”) wishes to announce that the Company’s subsidiary, Choo Chiang Marketing Pte. Ltd. (“CCM”), has signed a lease agreement with a third party for the leasing of a property located at Oxley BizHub, Block 61 Ubi Road 1, #01-11, Singapore 408727. Barring unforeseen circumstances, CCM expects to open a new retail branch at the aforesaid premises by the end of the current financial year ending 31 December 2015. The expected opening of this new retail branch is in line with the plans of the Company and its subsidiaries as disclosed in the Company’s offer document dated 15 July 2015.
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Looking through CCH, which has been listed for 2 years but hasn't seen much trading of its shares, I was reminded of George Goodman's Supermoney.
The 70% owner of CCH -- Lim Trust (which is 90% owned by Thomas Lim and 10% owned by Rocky Lim) -- has benefited immensely from its business and the sales of its shares.
1) There has only been 5 years of available data but it appears that CCH is an okay business. During this period, the average per-year FCF is about $3.56m. An investment property portfolio of about $15m and $5.1m of debt was also on its books during IPO; the years leading up to IPO can't be too bad.
FCF
FY16: $3.5m
(IPO) FY15: $3.3m
FY14: $2.9m
FY13: $5.4m
FY12: $2.7m
2) It was clear however, that the owners were looking to monetise their golden goose, as much as it could.
In FY12, it took additional loans of $3.0m and paid $4.8m of dividends. In FY13, it paid $7.4m of dividends with the help of an additional $1.3m loan and the proceeds from a property disposal. In FY14, it paid a $10.8m dividend which resulted in a net debt position of $1.8m, and Lim Trust sold 15% (out of 100%) of their shares to Rhodus for $5.5m. This sale values CCH at about $36m, or 10 times its average FCF over 5 years. In FY15, it IPOed by selling another 15% vendor shares, with only a tiny 0.5% sold (by Rhodus) by way of public offer. This sale values CCH at about $73m, or 20 times its average FCF over 5 years, or twice what Rhodus paid a year earlier.
Lim Trust receives:
FY15: $11.3m from sale of vendor shares, valuing CCH @ $73m
FY14: $10.8m from dividend + $5.5m from sale of vendor shares to Rhodus, valuing CCH @ $36m
FY13: $7.4m from dividend
FY12: $4.8m from dividend
Total: $29m
No dividends was paid in FY15; cash was used to pay down the debts incurred from previous years. A comparatively small $1.2m dividend was paid in FY16.
I'm not sure what opmi can expect from management in future years.
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