ValueMax Group

I started a new thread on this newly IPOed stock. This is the third one after MoneyMax and MaxiCash in SGX

Pawnbroker ValueMax launches IPO

SINGAPORE — The ValueMax Group, one of the oldest pawnbroking chains here, yesterday launched a S$70.4 million initial public offering, seeking to be the first in its industry to list on the mainboard of the Singapore Exchange.

The company is selling 138 million new shares at S$0.51 each, representing 25.9 per cent of its enlarged issued share capital after the IPO. About five million shares will be offered to the public, while the remaining 133 million will be offered under the placement tranche.

Trading is scheduled for Oct 30.
...
http://www.todayonline.com/business/pawn...unches-ipo

So can know which of the 3 valuations the cheapest? Don't think this IPO at 51 ct cheap.

(22-10-2013, 11:01 AM)hh488 Wrote: So can know which of the 3 valuations the cheapest? Don't think this IPO at 51 ct cheap.

Comparing the three stocks base on PE is misleading, IMO. Let's me put up a brief comparison between the three stock in PB.

MaxiCash - PB of 3.1, with market cap of 197 mil @ 42 cents

MoneyMax - PB of 3.0, with market cap of 127 mil @ 36 cents

ValueMax - At IPO price of 51 cents, the market cap is about 272 mil, with share base of 533 mil shares. The net asset was 78 mil (page 103 of IPO prospectus), that works out as PB of 3.5

In short, it seems ValueMax was demanding a higher valuation at IPO, comparing with the others. Let's see what is Mr. Market's valuation at its first trading day on 30 Oct.

(not vested)

The owner is portrayed in TODAY papers as having built business from scratch more than 10 years ago.

I think they are planning to build own brand pre-owned jewellery... 1st time I hear jeweller marketing and selling used pre-owned jewellery

The major pawn shops are cashing out before gold prices fall further.

(22-10-2013, 12:10 PM)CityFarmer Wrote:

(22-10-2013, 11:01 AM)hh488 Wrote: So can know which of the 3 valuations the cheapest? Don't think this IPO at 51 ct cheap.

Comparing the three stocks base on PE is misleading, IMO. Let's me put up a brief comparison between the three stock in PB.

MaxiCash - PB of 3.1, with market cap of 197 mil @ 42 cents

MoneyMax - PB of 3.0, with market cap of 127 mil @ 36 cents

ValueMax - At IPO price of 51 cents, the market cap is about 272 mil, with share base of 533 mil shares. The net asset was 78 mil (page 103 of IPO prospectus), that works out as PB of 3.5

In short, it seems ValueMax was demanding a higher valuation at IPO, comparing with the others. Let's see what is Mr. Market's valuation at its first trading day on 30 Oct.

(not vested)

Including the 66.3m raised,
ValueMax (post IPO) PB should be 1.88 (272 / (78 + 66.3))

half a billion business to raise $66 million from IPO?

(22-10-2013, 03:18 PM)MrValue Wrote:

(22-10-2013, 12:10 PM)CityFarmer Wrote:

(22-10-2013, 11:01 AM)hh488 Wrote: So can know which of the 3 valuations the cheapest? Don't think this IPO at 51 ct cheap.

Comparing the three stocks base on PE is misleading, IMO. Let's me put up a brief comparison between the three stock in PB.

MaxiCash - PB of 3.1, with market cap of 197 mil @ 42 cents

MoneyMax - PB of 3.0, with market cap of 127 mil @ 36 cents

ValueMax - At IPO price of 51 cents, the market cap is about 272 mil, with share base of 533 mil shares. The net asset was 78 mil (page 103 of IPO prospectus), that works out as PB of 3.5

In short, it seems ValueMax was demanding a higher valuation at IPO, comparing with the others. Let's see what is Mr. Market's valuation at its first trading day on 30 Oct.

(not vested)

Including the 66.3m raised,
ValueMax (post IPO) PB should be 1.88 (272 / (78 + 66.3))

Yes, you are right. I missed that. Thanks

I searched thru the old prospectus of MaxiCash and MoneyMax.

The PB (post IPO, adjusted with estimated proceeds) is 1.5 (NTA of 20 cents, with IPO price of 30 cents) for MaxiCash. Refer to page 46

The PB (post IPO, adjusted with estimated proceeds) is 1.9 (NAV of 16 cents, with IPO price of 30 cents) for MoneyMax. Refer to page 27.

So ValueMax was valued not too far from others.

(not vested)

EPS post invitation is ard 3+cents and that is with past 2 years of -ve operating cashflows.

Dividend policy is 50% for the next 3 years, so ard 1.5c (assuming flattish growth)
@ a listing price of 51c, this works out to be 2.94% yield

Given the working capital intensive nature of this biz, i find it difficult to see a higher cash payout anytime soon.

Why pay out dividend when capital is valued at 3X by Mr Market?