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Singapore IPOs: Why I No Longer Cover Every Listing

Some readers may have noticed that I have not been writing about every Singapore IPO since last year. The simple reason is that life has become busier. Between my day job, an increasingly packed travel schedule, family commitments and desire to play more golf, I have become much more selective about how I spend my time.  Writing detailed IPO reviews takes time — reading prospectuses, analysing financials, comparing valuations and understanding the competitive landscape. While I still enjoy investing and writing, I no longer feel the need to cover every IPO that comes to market. Instead, going forward, I will probably focus only on IPOs where I am seriously considering investing my own money or where there is something particularly interesting that is worth discussing. I suspect this will make the blog more useful as well. Rather than writing about every deal, I can spend more time sharing my thoughts on the handful that I believe deserve attention. That bring...
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Qualitas Medical Group Limited



Qualitas Medical Group Limited ("Qualitas") is issuing 22m New shares at $0.25 per share comprising 1.1m shares via public offer and 20.9m shares via placement. The Company was established in 1997 and is a leading private healthcare services provider in Malaysia. The IPO will close on 28 August 2008 at 12pm.

Revenue for FY2007 is RM 57.7m and net profit is RM 6.3m. From FY2005 to FY2007, the revenue increased from RM 51.9m to RM57.7m but the net profit has actually declined over the same period from RM 6.7m to RM 6.3m. This somewhat indicated a trend of small, gradual growth with declining margins. Qualitas is listing at the historical PE of 12.9x based on the fully diluted no. of shares. Based on post-ipo shares of 134,684,221 shares, the market cap of Qualitas is S$33.7 million.

Qualitas must have studied the Healthway IPO very closely. Healthway is now trading at a more 'reasonable' valuation of 9.16x PE (historical) at current price of $0.12 (a drop of 66% from its IPO price of $0.36) and there is no vendor sale for Qualitas.

Unless you are very bullish about the Malaysia healthcare sector in the next 3 years, my view is to give this IPO a miss until there is a clearer picture of its expansion plans and execution in India and the region. 1 chilli for now.





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Anonymous said…
Hey, thanks for the info.
Do you remember how did the IPO do in the first day? What was the open and close of the day?
30 June 2014 at 16:03
Mr. IPO said…
If I recall correctly, eventually the board decided not to proceed with the IPO.
30 June 2014 at 16:44
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