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IPO Chilli Ratings

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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Sincap Group Limited

This is for information only. No public tranche was offered.

Sincap Group Limited ("Sincap" or "Company") is in the trading of alumina and thermal coal, as well as in the mining and sale of gypsum in China.

The Company is selling 32.5m placement shares at $0.20 each of which 25.5m are new shares and 7m are vendor shares. The listing will be on the Catalist. The offer closed on 23 July and will be listed on 25 July 2012.

Based on the enlarged share capital and IPO price and assuming the service agreement was in place, the company will be listing at a historical PER of 58x. wow... and the market cap will be $35.1m. Since i am not privy to the 2012 projections, i will not attempt to determine its fair value. The company will be tightly controlled with a free float of 18.5%.

The directors intend to propose a dividend of at least 50% of its net profit for FY2012. Assuming the profit level remained the same, the profit in SGD will be around $810,000. Since they have raised SGD5.1m from the public, they should have the means to pay out $810k of which 81.5% will go to the founders of the company. Investors better hope the profit for 2012 remain low?!!?

I don't really fancy the IPO for the following biased reasons:

1. Small cap China-based mining firm.
2. Audited by non big 4 audit firm.
3. Expensive valuation.

My rating: Chopped Chilli.


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Vendor Agreements said…
In this vendor agreement agreement must mention the details about the service being provided by the vendor.
30 July 2012 at 15:12
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