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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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Vividthree Holdings Ltd

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Vividthree Holdings Ltd ("Vividthree" or the "Company") is placing out 51.8m shares at $0.25 each. The IPO has closed and will be listed on 25 Sep 2018. The market cap based on the IPO price is $83.50 million

Principal Business

The company is founded in 2006 and currently has a presence in Singapore and Malaysia. It is a virtual reality, visual effects and computer-generated imagery studio focused on content production and post-production. 


As part of its business strategies, vividthree intends to build up its digital IP through development of VR products and other immersive experiences. It also intends to expand overseas and make strategic acquisitions. 

Competitive Strengths


Financial Highlights


The Company has been profitable for the last 3 years where revenue grew from $3.9m to $7.06m and net profit as of FY2018 was $2.17m. The EPS based on the enlarged shares is 0.81 cents.


The pro-forma EPS is 0.86 cents and that translates into a PE ratio of 29x. The NAV per share is around 3.82 cents.


This is basically a human capital business. The margins are high but the ability to win deals and retain talents are equally important. 

What I Like about the Company
  • Increased use of VR technology - The use of visual effects is very common in movies nowadays and vividthree was involved in computer-generated imagery works in "Ah Boys to Men" series. The challenge will be winning the projects and the lineage to MM2 Asia should help
  • Creating IP content - The Company will produce thematic tour shows based on IP rights acquired or licensed from 3rd parties. On that front, vividthree is developing a VR thematic tour show based on the film "Train to Busan", which was very well received. This would be the most "exciting" segment if they are able to execute well
  • Profitable - While the listing valuation is high, at least the company is profitable and able to operate on the standalone basis.
Some of my concerns
  • Competitive landscape - The VR business is highly competitive and the ability of vividthree to expand beyond its "ah boys to men" fame will be important for its regional expansion
  • Thematic tour shows not proven yet - The company reminded me somewhat of Cityneon's expansion into different thematic sets by Avengers and they are doing the same with VR thematic shows, starting with popular movies such as Train to Busan. If it is successful, it will create a name and market for itself 
  • Transfer pricing - The Company will have business with its parent, MM2 Asia. While the relationships helps open doors, there could be potential transfer pricing considerations as MM2 Asia is involved in movie productions as well. The ability to deal at arm's length with MM2 Asia related projects will be important. 
  • MM2-related listings - MM2 Asia has been very successful in acquiring and then listing its different business units. Unsual Productions and Vividthree is a series of such spin outs. While i don't want to draw parallels with how Ezra spun out its different units previously, I genuinely hope this "spin out trends" doesn't continue as MM2 Asia is arbitraging the difference between the valuation at which they acquired the companies and subsequently listing these entities 
Mr IPO's view

From MM2 Asia to Unusual Productions, Melvin Ang has a group of "strong" supporters behind him. I envisage the support for vividthree will be similar. Even though the valuation of vividthree is high at 29x, i believe the mm2 "fans" will continue to support him.  

As such, despite the weak sentiment, my "anyhow" guess is that it will be 2 chili rating opening. Good luck to those who had received the shares. 

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