Singapore O&G Ltd

[Bibi]

PD isnt really a cash cow i feel as compulsoty injections can be done in Polyclinics for a very very subsidised price.

Dont go polyclinics lah. I used to go to normal GP for son injection. THen i heard from friend how fast and cheap it was to do it at poly. I decided to give it a try. Then i see how "thick" the injection needle was compared to those used at normal GP. My baby son cried like hell. After that, i nv used poly anymore.

[CityFarmer]

PD isnt really a cash cow i feel as compulsoty injections can be done in Polyclinics for a very very subsidised price.

Dont go polyclinics lah. I used to go to normal GP for son injection. THen i heard from friend how fast and cheap it was to do it at poly. I decided to give it a try. Then i see how "thick" the injection needle was compared to those used at normal GP. My baby son cried like hell. After that, i nv used poly anymore.

I concur. My girl did it with GP. Base on peers' feedback, Polyclinic was done by junior nurses, but GP was done by doctor. My experience with GP was good.

Quite a number of my peers, done with PD, especially those with weaker kids. Of course, I don't deny some of them are more of the "kiasu".

[buyhighselllow]

This reminds me of the Talkmed listing which has done really well since its IPO.

Nick, Agree that there are parallels with Talkmed. Same IPO banker too Hong Leong Finance. Both operate in a niche area with a small but growing chain of clinics. We are essentially betting on a few doctors (i.e. Dr Ang Peng Tiam for Talkmed and Dr Lee Keen Whye, Dr Heng Tung Lan, Dr Beh Suan Tiong for SOG) as they are the rainmakers.

I think the main difference is Talkmed Dr Ang is the controlling shareholder, CEO and the main rainmaker. SOG CEO and co-founder Dr Ng Koon Keng does not run his own clinic and owns less than 4%. Not sure whether this is a good or bad thing, curious what forumers think. Good - he can focus on expanding the business as not bogged down serving patients daily. Not good - less alignment of interests if we want to compare with Talkmed since he owns only a small stake

I think it seems like a decent short-medium term investment as the proposed dividend will support the price. Clean balance sheet is obviously a key selling point too. Longer term i'm not sure yet, what do others think?

[CityFarmer]

Why does the doctors in SOG want to ipo?

Their business isnt really scalable as its limited by labour. They dont need much to raise much capital.
Wouldn't they be better off doing what they have been doing before as a private enterprise and therefore do not need to share any profits with other shareholders and keeping all to themselves?

Then u may say, they are cashing out..but the money raised isnt that much and i am sure they earn much more..

Listing now, they are saddled with more adminstration work.

Just weird.

And the dependency of apparently some super star doctors spell high risk...if they leave what happens to SOG.

I guess for better liquidity and valuation.

I am looking a both TalkMed and this company. I agree with Nick, the company might perform as good as TalkMed. Both are structured similarly.

TalkMed IPO price was pretty cheap, and Sing O&G is higher. TalkMed demands a PE around 18 now. If Sing O&G has similar valuation, the upside might be +50% with similar EPS at IPO.

[madagnet]

CEO Dr Ng Koon Keng used to be the CEO of Asiamed listed on catalist.

Might be a good case study for people interested in this IPO.

Anyway the offering is only 2mil shares @ 0.25. This works out to about S$500k offered to public. Chances of successful subscription is extremely limited. Good luck everyone!

[Nick]

This reminds me of the Talkmed listing which has done really well since its IPO.

Nick, Agree that there are parallels with Talkmed. Same IPO banker too Hong Leong Finance. Both operate in a niche area with a small but growing chain of clinics. We are essentially betting on a few doctors (i.e. Dr Ang Peng Tiam for Talkmed and Dr Lee Keen Whye, Dr Heng Tung Lan, Dr Beh Suan Tiong for SOG) as they are the rainmakers.

I think the main difference is Talkmed Dr Ang is the controlling shareholder, CEO and the main rainmaker. SOG CEO and co-founder Dr Ng Koon Keng does not run his own clinic and owns less than 4%. Not sure whether this is a good or bad thing, curious what forumers think. Good - he can focus on expanding the business as not bogged down serving patients daily. Not good - less alignment of interests if we want to compare with Talkmed since he owns only a small stake

I think it seems like a decent short-medium term investment as the proposed dividend will support the price. Clean balance sheet is obviously a key selling point too. Longer term i'm not sure yet, what do others think?

The 3 rainmakers for SOG collectively generated 90-93% of the Group's revenue for the past three years. They will collectively own 63.91% of the Group post IPO.

Pros:

1) More diversified rain-makers (1 vs 3)
2) Separation of operational and executive management team.
3) Alignment of interests

Cons:
1) Weaker margins than Talkmed.
2) Short operating history.

The yield will prove to be attractive coupled with the low PE. But as others have mentioned, it will be quite tough to secure it from the Public Offer due to the small float available.

Quite interested to see how sustainable this model (Talkmed, SOG) will be in the coming years.

[MINX]

PD isnt really a cash cow i feel as compulsoty injections can be done in Polyclinics for a very very subsidised price.

Dont go polyclinics lah. I used to go to normal GP for son injection. THen i heard from friend how fast and cheap it was to do it at poly. I decided to give it a try. Then i see how "thick" the injection needle was compared to those used at normal GP. My baby son cried like hell. After that, i nv used poly anymore.

I concur. My girl did it with GP. Base on peers' feedback, Polyclinic was done by junior nurses, but GP was done by doctor. My experience with GP was good.

Quite a number of my peers, done with PD, especially those with weaker kids. Of course, I don't deny some of them are more of the "kiasu".

Just make me wonder after reading your post, if we bring up our kids this way, does it make them too soft to face challenges in life?

[vesfreq]

Why does the doctors in SOG want to ipo?

Their business isnt really scalable as its limited by labour. They dont need much to raise much capital.
Wouldn't they be better off doing what they have been doing before as a private enterprise and therefore do not need to share any profits with other shareholders and keeping all to themselves?

Then u may say, they are cashing out..but the money raised isnt that much and i am sure they earn much more..

Listing now, they are saddled with more adminstration work.

Just weird.

And the dependency of apparently some super star doctors spell high risk...if they leave what happens to SOG.

Else these superstars need to be paid super premium for them to stay.

I have to say that you are right about scalability. I cant fathom the rate of increase in patient counts. For growth to occur, there has to be:
1. Patient numbers
2. Room for margin widening
3. Lower cost.

Patient numbers may be challenging with public hospitals and also rmg n parkway offering full suite of medical services. Sog cant bundle services like rmg n parkway.

Margin widening also not so easy. I dont have a kid. As an outsider, cant comprehend how much wider margins can go. If margins too wide, it will have after effect on fees and prices. Not so ideal given the competition from rmg n parkway.

Cost cant be much lower. Superstar docs cost a premium. And with listing costs, its one tough biz. May be dental biz easier. More mouths to maintain. With longer average life spans, dentistry cant do too badly.

Just a.few thoughts.

[CityFarmer]

PD isnt really a cash cow i feel as compulsoty injections can be done in Polyclinics for a very very subsidised price.

Dont go polyclinics lah. I used to go to normal GP for son injection. THen i heard from friend how fast and cheap it was to do it at poly. I decided to give it a try. Then i see how "thick" the injection needle was compared to those used at normal GP. My baby son cried like hell. After that, i nv used poly anymore.

I concur. My girl did it with GP. Base on peers' feedback, Polyclinic was done by junior nurses, but GP was done by doctor. My experience with GP was good.

Quite a number of my peers, done with PD, especially those with weaker kids. Of course, I don't deny some of them are more of the "kiasu".

Just make me wonder after reading your post, if we bring up our kids this way, does it make them too soft to face challenges in life?

You mean the kids are pampered? Well, I don't think so with GP over Polyclinic.

[Nick]

Why does the doctors in SOG want to ipo?

Their business isnt really scalable as its limited by labour. They dont need much to raise much capital.
Wouldn't they be better off doing what they have been doing before as a private enterprise and therefore do not need to share any profits with other shareholders and keeping all to themselves?

Then u may say, they are cashing out..but the money raised isnt that much and i am sure they earn much more..

Listing now, they are saddled with more adminstration work.

Just weird.

And the dependency of apparently some super star doctors spell high risk...if they leave what happens to SOG.

Else these superstars need to be paid super premium for them to stay.

I have to say that you are right about scalability. I cant fathom the rate of increase in patient counts. For growth to occur, there has to be:
1. Patient numbers
2. Room for margin widening
3. Lower cost.

Patient numbers may be challenging with public hospitals and also rmg n parkway offering full suite of medical services. Sog cant bundle services like rmg n parkway.

Margin widening also not so easy. I dont have a kid. As an outsider, cant comprehend how much wider margins can go. If margins too wide, it will have after effect on fees and prices. Not so ideal given the competition from rmg n parkway.

Cost cant be much lower. Superstar docs cost a premium. And with listing costs, its one tough biz. May be dental biz easier. More mouths to maintain. With longer average life spans, dentistry cant do too badly.

Just a.few thoughts.

I view it differently. We are not simply buying a healthcare operation. Rather, this is akin to investing in a healthcare professional (the trio) and the market capitalization is the PV of their income stream. Personally, this is why the PE of Talkmed and SOG (at IPO) is in their low teens as compared to healthcare operators whose PE lies over 20. The revenue of these businesses are 'salary of the professionals'. The margins are high since nobody depreciates human life in the accounting world (yet). Perhaps one day, we can start investing in football stars too haha ! This is my own view of their business model. I intend to apply for the IPO. I think the yield will prove to be attractive to many investors coupled with Talkmed stellar performance post IPO. Feel free to point out otherwise.