Skip to main content

IPO Chilli Ratings

IPO Chilli Ratings
Click to understand how it works

Featured

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

Sabana REIT

Sabana Shari'ah Compliant Industrial Reit is offering 508 million units for $1.05 each in its initial public offering (IPO). About 432.5 million units will be for large institutional investors with the remaining 75.5 million available to small investors.

The units will give a yield of 8.22 per cent for next year, based on the expected distribution of 8.63 cents per unit. The yield for 2012 is expected to be 8.25 per cent or 8.67 cents per unit. The offering closes at 6pm on Wednesday with trading expected to kick off at 2pm on Friday.

Sabana holds 15 industrial properties across Singapore and will manage them in line with Islamic principles. To be Shari'ah Compliant, the premises cannot be used for gambling, for example, or the production of pork or alcohol for human consumption. An independent Shariah committee will advise the Reit manager and issue the compliance certification.

Mapletree Industrial Trust is currently trading $1.09 (and that translate into a yield of 6.82%m versus the yield of 8.22% for Sabana for next year). Having said that, MIT is a much bigger firm with better assets and Ah Gong's backing, thus the credit worthiness and ratings are at a premium.  Assuming a fair value yield of 7-8%, that will translate into a fair value price of between $1.12 to $1.23. However, the firm is launching its IPO amidst uncertainties over the Euro zone economy, jittery markets and a mini "war" breakout between the Koreans. In this aspect, while i expect downside to be limited, do not expect any spectacular 'fireworks' on its debut. I think it will likely be range bound between the fair value range i mentioned above. 

I would have preferred it to be priced "below $1" by issuing more units so that it can cross above $1 on its debut (something like how MIT has priced itself). However, what i am proposing is just more psychological than anything else. I will give it a 2 Chilli rating but dont think you will 'miss anything' even if you dont apply.

Comments

Anonymous said…
I have been monitoring the REITS in Singapore. This REIT is similar to Cambridge Industrial Trust not MIT. Hence, it should not hold a premium and should trade lower to about 9-10% yield.

Plus all its restriction and compulsory donation needed for profits, this trust will have prob negotiating when a crisis comes...

Good to stay out for this..
Mr. IPO said…
I also agree with you that it is more like cambridge. :) Cheers.
Anonymous said…
First day already drop below ipo.
Mr. IPO said…
Guess the "sponsor" of REIT is important, which is why i said "won't miss much if you miss this IPO". :)
Anonymous said…
Agreed. Not sure how many people get burn on this ipo.
Anonymous said…
@2Y Capital:

Can I ask normally what is your few criteria you judge when you see an IPO? Hoping to discuss so that both of us can learn something new... :) Actually, I myself got a list of criteria, but sometimes things are not that black and white. I am thinking of ways to minimise the amt of risk such that all risks taken are calculated ones..
Mr. IPO said…
The few key criteria will be:

1. Company's Valuation, biz and prospects.
2. Peers'valuation
3. Market sentiments
4. Sponsors for the listing.