Wednesday, 5 August 2009
Mary Chia Holdings Limited
(This person is not Mary Chia :P but the spokeswomen "李锦梅")
Mary Chia Holdings Limted is one of the leading lifestyle and wellness service provider in Singapore. It is offering 24.565m new shares at 23 cents per share to investors via placement only and will be listed on the Catalist and the offer will close on 6 Aug 2009 at 12pm.
Revenue has grown from $10.84m in FY2006 to $13.46m in FY 2008 while net profit increased from $0.75m to $3.05m in the same period. The NTA post IPO will be 3.3 cents. The earnings per share for FY 2008 assuming the service agreement is in place will be 1.60 cents and based on the IPO price of 23 cents, the company is being priced at a historical PER of 14.4x (expensive!). The market cap post IPO will be $37.6m
You would have known by now that i dont like Catalist listings as a high percentage of the proceeds raised are paid to the Sponsors. I have no idea what is the point of raising $5m and giving $2m away. It is crazy! In addition, post listing, the mother - Mary Chia and her daughter - Wendy Ho, own 81% of the company and investors are purely minority shareholders. Prior to the IPO, the company has also declared generous dividend to its owners and the company still owes money to the founders post IPO. Given the low profitability, the Company will still pay generous package of at least $500,000 to the founders.
Avoid this IPO. The business is too localised with many unlisted competitors such as Expressions and Jean Yip.