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Saturday, 19 May 2012

Swee Heng IPO thoughs

Some points that I found interesting


Competitive Strengths:
Established and proven track record of more than 43 years
- Our track record of repeatedly winning public sector tenders
is testament to the quality of our services. Most of our revenue
is derived from our public sector works – 100% in FY2011,
and 97.2% in FP2012.

Prospects:

- BCA has indicated that construction demand from the public sector
in 2013 and 2014 is expected to range between S$12 billion and
S$15 billion per year.

- The new North-South Expressway - a dual three-lane, expressway
to serve the north-south corridor is expected to commence
construction in 2013 and be completed by 2020.
- A dual four-lane road in Bukit Brown, linking Thomson Road, Adam
Road and the Pan Island Expressway, is expected to commence
construction in early 2013 and be completed by 2016.

Auditors: Nexia TS Public Accounting Corporation

NAV after ipo 13.62c

Dividend Policy: We currently do not have a fi xed dividend policy. However, we intend to recommend and distribute dividends of at least 20% of our net profi ts after tax attributable to Shareholders for FY2012 and FY2013

Trade and other receivables: 31m of which 24m is from contracts. (note that govt always will inspect thoroughly before payment)

Cash: 9.2m

Total Assets: 52m

Total Liabilities: 17.5m

Post IPO shares: 368.5m

Interesting to note that this is a family business so shares would be tightly held and see little play with the freefloat. At most during IPO, it might be played for a couple of days.

It might be worth a punt based on ipo price but a float of 2.8m for public will make it tough to get a good allocation. Also, the markets have just started their downtrend, so might not be a good time to vest.




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