CMC Infocomm Limited ("CMC" or the "Company") is offering 24m New Shares at $0.25 each. There will be 21.6m placement shares and a public tranche of 2.4m shares. The IPO will end on 12pm on 11 Aug 2015 and start trading on 13 Aug 2015. The market cap is around S$38m
The Company is a regional communications solutions and services provider with operations in Singapore, Thailand and the Philippines covering four main segments:
- In-Building Coverage
- Outdoor Construction
- Telecommunications Implementation
- Maintenance Services
Financial Performance
I am not privy to the projected performance for 2015. Assuming it makes a fully diluted EPS of around 0.36 cents, the PE ratio is still a very high double digit number > 40x.
I don't like the fact that the revenue is overly concentrated in M1.
What i like about the Company
- It's a regional company with operations in higher growth countries like Thailand and Philippines and not limited to Singapore.
- Even though it is a small listing, the majority of the proceeds (66%) will be used for business. The Invitation expenses makes up the balance.
- Company finally turned around this year for the first 9 months.
- Interesting corporate shareholders in CMC Engineering and Tee International, which resulted in 84% being locked up.
- Interesting appointment of Alex Siow as independent director, who used to work as Starhub
Some of my concerns
- It has a small cap company with short operating history, having started in 2011 and making losses for last 3 years
- M1 is a major customer at between 34-47% of the revenue! Heavily reliant and M1 is also facing tough environment in Singapore
- It is a competitive landscape and the Company is right down the value chain with no recurring source of income
- Seems like a business created by a father for his son...
Mr IPO ratings
I will give it a one Chilli rating - buy only if you are in the mood to punt.
From a fundamental perspective, really nothing to shout about. I don't really like the fact that it is over reliant on M1 as well as the prospects of the sector. The IPO valuation is also too high. I struggle to give it a higher rating for fundamental reasons and will run road if i can make money. (you may want to buy Tee International instead) ^_^
Having said that, the free float of 24m is really small and can be easily taken up by friends and family of Tee International and CMC Engineering. It is not too difficult to place out the shares well.
Mr IPO is vested with 100 lots. Let's see how it performs but he won't overstay his welcome and will run road where possible.
Comments
Anyway, good luck to you and huat ah!
From: Dennis.
When he buys and recommends others to buy, price goes up
THen he sells and price goes down, and these others who follow his recommendation suffer a realised loss.
So, please dont miscommunicate when u write your articles
Choo Chiang 1st day close 39 cents from IPO price of 35 cents. Thereafter drop back to 36 cents. So sell at 30 cents for CMC Infocomm.
SGX stock market is profitable for the tradingpoint of view Singapore stock recommendations is best way to earn money.
Please be specific ^_^ on which part is unclear? :)
Anonymous to Annonymous: wasn't refering to you lah.. I said "non-anonymously", not "non-annonymously". chill bro =)
IPO Fella can get 100 lots so easily means danger sign is there..
lucky i cut loss at 24.5 cents this morning...
I have placement shares but advised readers not to subscribe, I get ridiculed for "losing money".
Really don't know what your guys want. Not that I really care anyway but I just find it hilarious. Lol
A man is measured by the things that bother him. Keep it up! =)
Ignore all those haters. Been a follower of your blog since ages ago, please don't let these haters stop you from all the IPOs update.
Looking forward to your Soo Kee analysis soon!
this retard total loser IPO fella is always wrong in his predictions on IPO's debut performance. He wrote Choo Chiang and IX Biopharma are NOT good and should avoid but these 2 ipos opened ABOVE their ipo prices for a STAG instead. Then this lousy CMC infocomm he never say avoid and he took big placement, instead this IPO opened BELOW water on it's debut.
Last time that Pahlawan and Tradesman are the good zhun ones on IPO's opening day predictions