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Tuesday, 23 October 2007

Rokko Holdings Limited

This is a 'small float' company with only 30m shares (28m placement and 2m public). It will be extremely difficult to get the shares from the public offering. Due to the small float, it is likely to be a stag on the first day but may dribble lower once investors forget about this counter. In addition, it is also in the tech sector which in my view, is not very 'exciting'. Although it is likely to be a 'stag' for IPO punters, i think investors can give this counter a miss for the following reasons:

(1) Difficult to get at the IPO

(2) Unattractive sector as it is very dependent on the semiconductor industry which is very volatile and cyclical.

(3) Fair value is only a slight premium to the IPO price.

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