Tuesday, 13 July 2010

Smartflex Holdings Ltd

Smartflex Holdings Ltd is a provider of IC module assembly and testing sevices for contact and dual interface smart cards based in Singapore.

The Company is offering 13m New shares at $0.22 each where 1.5m shares is via public offering and the rest via placement. Offer will close on 15 July at 12pm. The market cap is S$18.1m.

Revenue grew from US$14.6min FY 2007 to US$18.1m in FY2009. Profit after tax grew from US$1.2m to US$1.9 during the same period. EPS based on post IPO shares will be 2.33 US cents for FY2009. Based on post IPO shares and assuming service level agreement is in place in FY2009, the company is being listed at a PER of 6.65x.  The company intends to pay out 20% of its net profit attributable to sharesholders as dividend for FY2010.

The IPO is fairly priced and the market cap is too small. I personally dont favour such tech counters for long term investing and would avoid this IPO.

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