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Saturday, 19 November 2011

JK Tech Holdings Limited

For records purpose only

JK Tech Holdings Limited ("JK Tech" or "the Company") placed out 10m new shares at $0.20 each for a listing on Catalist.  The offer closed on 10 Nov 2011. 

The Company is a one stop provider of IT products, services and solutions to companies. It reported a revenue of $19.8m for FY2011 with a net profit of $2.7m. The EPS based on the enlarged post IPO share cap was 4.08 Singapore cents. That translate into a listing PER of 4.9x. The market cap post listing is only $13.27m, ultra small cap company.

Just a note of caution: For ultra small cap company like JK Tech or Libra, the free float is actually very small. Imagine the number of shares for free float is 66.4m x 30% = 19.9m shares. At 20 cents, the free float translate into $3.98m value. In other words, the founders just need to find 10 friends to take about $400k each to absorb the free float and push up the price thereafter. That is why you see wild swings in prices of such stocks if they are being targeted by speculators. The name of the game is 'dont be the last one holding the baby'. 


Ren said...

Haha, true. Don't be the last to hold the baby.

Dennis The Menance said...

While Jf Tech Holding may be a good company. I do Not believe that it is anymore than an average stock as far as expected returns go. I would invest in a company called PFS web Symbol {PFSW.} The Company provides business process outsourcing and ecommerce solutions in the United States, Canada, and Europe. The stock trades around 3.30 a share.

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