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IPO Chilli Ratings

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Food Innovators Holding Limited

Food Innovators Holdings Limited ("FIH" or the "Company") is offering 14m shares at $0.22 each, for which 13m shares will be through placement and the remaining 1m shares via a Public Offer. The IPO will close on 14 Nov at 12 noon and starts trading on 16 Oct 9am.  FIH has two business models - the first is to be a master lease and sublease the space to other tenants and the second is to operate and manage restaurants.  The Company currently has 12 restaurants in Japan, 10 in Singapore and 4 in Malaysia. The market cap based on the IPO price is around $24.9m. Financial Highlights FIH's revenue grew from $37.8m in FY2022 to $43.8m in FY2024. It is quite funny to see that being a master land lease holder has a higher margin than operating the restaurants, once again illustrating the point that it is better to be a landlord to shake leg and collect rent. According to the prospectus, the PER is around 19x. The Company intends to pay 20% of its net profit after tax a
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Debao Property Development Ltd

My apologies to all readers here. Just came back from overseas and i thought i could get a picture of the IPO booth today (saw it yesterday) but interestingly, they dismantled the IPO booth before the IPO closes! The IPO close on 8 April 2010 at 12pm.

Debao Property Development Ltd is an integrated property developer in Foshan City, PRC. The company is offering 138m shares at 43 cents each comprising of 125m New Shares and 13m Vendor Shares. 1.5m shares will be via public offer and 136.5m shares via placement. The vendor shares are sold by pre-ipo investors and the list is rather long (comprising many individuals and BVI companies). Pre-IPO investors are getting in at 50% discount to the IPO price and that translate into a price of 21.50 cents. Pre-IPO investors still hold a chunky 27.54% post IPO and the share price is likely to face selling pressure once the moratorium is over.

The IPO proceeds will be used for existing property development projects, acquiring new sites and for working capital. The market cap based on enlarged 1.125m shares is $483.75m and the adjusted NAV per share post IPO is Singapore 20.23 cent. In this aspect, at 43 cents, investors are paying a high premium over its net worth (more than 112%).

Revenue was RMB 136.6m in FY 2008 (a drop of 54% over FY2007).  Net profit dropped to RMB 2.7m versus 111.97m in FY 2007 (a drop of 97.5% over FY2007). For the 1H 2009, revenue was RMB 202.67m and net loss was RMB 16.1m

I am not going to spend too much time and effort on this company as I believe investors are better off not buying the IPO. The company is too 'concentrated' in Foshan and the Chinese government is keen to rein in prices in the booming property sector. The overhang in shareholders post moratorium will also not be a good sign.

Give this IPO a miss.
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