Sunday, 15 June 2008

Combine Will International Holdings Limited



Combine Will ("CW") is offering 88 million new shares at S$0.23 per share of which 5m will be for public and the rest via private placement. The Company is based in Dongguan, Guandong Province and there are 3 main business segments - ODM/OEM of plastic and die-cast products, moulds and tooling and machines sales. The IPO will close on 19 June at 12pm and will commence trading on 23 June.

Audited revenue for FY06 is S$174m with net profit of S$5.47 million. For the 9m ended 30 Sep 2007, the sales is S$153.5m and net profit is $10.5m. It is amazing that the Company was unable to disclose its full year audited figures for 2007 as it is already the June period, almost close to the end of the statutory reporting for companies with financial years ending on 31 December.

Based on the post IPO shares of 328m shares, the market cap is around $75.4 million. This is really a small cap company. Assume a full year profit of S$14m to S$17m, the EPS will range between 4.3 cents to 5.2 cents. At the IPO price of 23 cents, it is trading at the PE range of 4.4x to 5.3x, which is typical of small S-chip stocks in Singapore.

I will avoid this counter for now due to its small cap status, competitive segment and poor IPO sentiments.

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