Keong Hong Holdings Limited ("KHH" or "the Company") is offering 27m New Shares at S$0.24 each for a listing on Catalist. The Company is a provider of a broad range of building construction services. As of 30 Sep 2011, the order book was S$541m.
The timing couldn't been "better". Right smack in between the new property measures (additional stamp duties) and the European crisis.
The revenue grew from $78m in FY2008 to $125m in FY2010. Net profit grew from $1.4m to $8.1m and net margin improved from 1.9% to 6.5% during the same period.
There are no public tranche in this IPO. The NTA after considering the new shares issues is $0.2094. The fully diluted EPS based on the enlarged share cap and assuming the service agreements were in place is Singapore 4.94 cents and that translate into a historical listing PER of around 4.85x. Based on the IPO issue price, the market cap is around S$38.4m.
This is the second 'construction' related company to list in recent weeks after TA Corporation. As company is not issuing shares for the general public, i will not attempt to determine its fair value. However, looking at the historical listing PER, the Company is definitely fairly valued. Any upside will be considered a bonus.