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Singapore Institute of Advanced Medicine Holdings Ltd

Singapore Institute of Advanced Medicine Holdings Ltd ("Sam" or the "Company") is offering 114m new shares comprising 4.415m Public Offer Shares and 109.585m Placement Shares at $0.23 each for a listing on Catalist.  The Company aims to raise $26.2m and the majority of the proceeds will be used to repay debt and the balance for working capital. The market cap based on the IPO price is $231.8m and the offer will close on 14 Feb at 12 noon and starts trading on 16 Feb 2024 at 9am.   Principal Business SAM is a healthcare service provider using advanced technology for early and accurate diagnosis to detect and treat cancer, neurodegenerative and cardiovascular diseases.  SAM has strategic collaborations with public and private institutions for research and clinical work.  SAM's goal is to create a comprehensive one-stop ambulatory cancer centre to undertake the challenges to fight cancer and is one of the first to adopt proto beam therapy treatment in Singapore. Fi
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Li Heng Chemical Fibre Technologies Limited


(IPO booth at Raffles Place - Photo compliments from Fergus)

Li Heng Chemical Fibre ("Li Heng") is offering 400m shares (340m new shares, 60m vendor shares) at $0.80 each. 10m shares will be for the public while 390m shares will be privately placed out. It is amazing that under current sentiments, the vendors are still allowed to cash out at IPO. Closing date is 10 March 08 at 12pm. Market cap is $1.36 billion based on 1.7b shares at IPO price of $0.80. The cost per share to the Pre-IPO investor is around 41.58 cents (versus IPO price of 80 cents).

Li Heng is primarily in the business of manufacturing and selling high-end nylon yarn products in China. The main listed rival on SGX will be China Sky. To get a better feel of Li Heng, let's look at 2006 and 2007 financial results of China Sky:

2007 sales - $449.1m. Net profit - $127.9m. EPS - 16.1 cents
2006 sales - $374.4m. Net profit - $102.8m EPS - 14.3 cents

The financials for Li Heng is as follows:

2006 sales - $338m. Net profit - $95.2m. EPS - 5.6 cents
2007 1H sales - $285.8m. Net profit - $93.7m. EPS - 5.51 cents.

Assuming 2007 full year sales doubled. Sales will be 571.6m and net profit will be $187.4m. The EPS will be 11.02 cents. Based on the IPO price of 80 cents, it is priced at 7.3x 2007 PE. China Sky's share price at the close of March 7 is $1.07, the share price of China Sky is trading at 6.6x 2007 PE.

It appears that China Sky will present a better investment opportunity than Li Heng. My suggestion is to keep your cash at bank and save the IPO application fee of $2. On a longer term basis, assuming a fair value PE of 8-10x, Li Heng's fair value will range from 88 cents to 110 cents.
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