Global Premium Hotel Limited

Download the Prospectus here

Global Premium Hotel Limited

Offer Price: $0.26
Offer Size: 450m new shares
Public Tranche – 13m shares
Placement Tranche – 437m shares
NAV per share (post-IPO): S$0.2897
Historical PE: 7.5x (FY10)
Market Cap (post-IPO): S$260m
Open: 19 Apr 2012
Close: 24 Apr 2012, 12.00 noon
Trading: 26 Apr 2012, 9.00 a.m. (on “ready” basis)

Global Premium Hotel Limited operate one of Singapore’s largest 

chains of hotels with 23 hotels, of which 22 are operated under our 

“Fragrance” brand and one hotel under the “Parc Sovereign” brand. 

GPH provide economy-tier and mid-tier class of accommodation with

1,738 rooms in Singapore and own all our hotels save for Fragrance

Hotel – Elegance. As at 31 October 2011, the market value of all the

22 hotels which GPH own amounted to S$747.6 million.

The company is principally engaged in the business of developing and

operating economy-tier to mid-tier class hotels. The established track 

record  and reputation of providing affordable accommodation has led to

“Fragrance” brand of hotels becoming well recognised in the local 

and regional hospitality industry. Most of the hotel property assets and

 hotel operations are strategically located in the city or city-fringe areas.

Over 85% of the 22 hotels owned are on freehold land. The hotels are

fairly new, with half being in operation for five years or less.

The company will raise about S$112.1 million from the listing
of shares and they will use the net proceeds as followed:

(a) approximately S$75 million will be Partial repayment of the 

Purchase Consideration
(b) approximately S$30 million will be Development and expansion of

 hotel business and operations in Singapore and overseas
(c) approximately S$7 million will be Working capital purposes

Global Premium Hotel Limited is actually a spin-off from its parent,

Fragrance Group which is also listed in SGX and will remain as the

major shareholder after the listing. The company intend to distribute 

at least eighty per cent. (80%) of net profit after tax to Shareholders

for FY2012, as they wish to reward our Shareholders for participating in

our Group’s growth. According to Euromonitor International:
i) Singapore’s inbound tourist arrivals are expected to increase by 2.7% p.a.

during 2011-2015 to reach 21.9m trips by 2015; and
ii) Retail value of Singapore hotel accommodation is expected to increase

by 50% from an est. S$4b in 2011 to S$6b in 2015
According to the Singapore Tourism Board, for the first two months of this 

year, the Revenue per Available Room (RevPAR) of Singapore hotels has

increased by 19% YoY to S$225, according to the Singapore Tourism Board.

The hotel chain has grown over the years, with 5-year CAGR of 13.9%

 and 10.9% for the number of hotels and rooms respectively. It also 

achieved growth in the average occupancy rate from 76.9% to 89.4% 

between 2008 and 2010. GPH’s revenue for FY10 was S$44.2m, 

demonstrating a 2-year CAGR of 9.4%. 9M11 revenue was at S$38.9m, 

up 20% YoY. GPH’s gross profit margins for FY10 (ended Dec 2010) and 

9M11 were both at 88.3%. Net profit margins for FY10 and 9M11 were 44.9%

 and 44.5% respectively.

It is very interesting to know that the company is actually listed at a discount

to its NAV and not like many others listed at a huge premium over it.
Although it can be deduced that most of the company's asset are the hotels
and the land it owned and so it is subjected to varied valuation at different time,
but I still like the fact that we are getting the stock at a discount right now. 
Also, another thing worth mentioning is the average price that the major 
shareholder Fragance Group actually "paid" for the share at 25cts and we as
a new shareholders can get the share at 26cts. That is only a single cent above
the major shareholder and this will also provide a good support to the share price.  

Just for comparison purpose, Bumitama's post-IPO NAV is 32.9cts and the 

new shareholder are paying 74.5cts which is a premium of 56%. The major

shareholder's average price per share are 4 and 2.6cts respectively and

the public pay the IPO price of 74.5cts

Civmec listed at 40cts and its post-IPO NAV is 12.7cts The major shareholders

pay as low as 4cts to a high of 23.4cts for the shares and public pay 40cts.

Get the picture?

When I look at the not-final prospectus in the comment stage, I wasn't really 

impressed by what I read and thought of giving the IPO a miss. But I was wrong, 

when I read the final prospectus again, I was sold and I believe that this a great

opportunity to own a stock that is likely to grow with the nation's progress and 

the influx of tourists and foreigners. With 13 million shares for public application,

the chances of getting the share is reasonably high and I will "show-hand" to

apply for it. If I manage to win the lucky draw, I will hold the stock for a 50-100%

profits considering the dividend and capital appreciation. 

Take note that I am not saying that the stock will surge 50-100% on its debut but

I will keep the stock until that level. This is just my view but I believe that given 

its business potential and prospect, it is a future take-over target, and I totally 

won't be surprise if it happen this way. But this is just my crystal-ball reading, 

so take it with a pinch of salt.

Source: Global Premium Hotel Limited IPO Prospectus, IPO Fact Sheet
by OCBC

Civmec Limited

To download a copy of the prospectus

Civmec Limited

Offer Price: $0.40
Offer Size: 51m new shares + 50m vendor shares
Public Tranche – 2.0m shares
Placement Tranche – 99m shares
NAV per share (post-IPO): S$0.127
Historical PE: 23.9x (FY11)
Market Cap (post-IPO): S$200.4m
Open: 5 Apr 2012
Close: 11 Apr 2012, 12.00 noon
Trading: 13 Apr 2012, 9.00 a.m. (on “ready” basis)

Civmec Limited is an Australian-based integrated
multi-disciplinary construction and heavy engineering
services provider to the oil and gas, mining and other
industries, such as the infrastructure, utilities, chemical
and power industries. The company provide heavy
engineering and other services including fabrication,
site civil works, pre-cast concrete and maintenance services.

The company will raise about S$18.1 million from the listing
of shares and they will use the net proceeds as followed:

(a) approximately S$6 million will be committed for Building of office
 — relocation to larger premises
(b) approximately S$3 million will be Investment into additional
fixed assets for expansion into SMP
(c) approximately S$9.09 million will be Working capital/provision
of performance and warranty guarantees


Based on the offer price of 40cts, Civmec with an NAV of just
12.7cts will have a 214.4% premium of Invitation Price per Share
over the Adjusted NAV per Share. This is a very rich valuation
of the stock offer price. And the Historical PE of 23.9x is also
reasonably high.

This IPO is consider much muted than its previous 2
IPO in Cordlife and Bumitama and there isn't a lot
of media coverages and reports on it. Maybe because
it is just a significantly smaller listing. Given such a high
valuation, will Civmec still perform when it debuts on this Friday?
Yes, I believe it should still have a decent performance base
on the fact that there is a "oil and gas" component in its business.
Nowadays, anything dealing with it seems to be in the limelight
and Civmec will be the same.There is only 2 million for public
application and the chances  of getting it is like playing 4D and
Toto, but nevertheless I will still risk my $2 application fee.
Do take note that I feel that the stock is "expensive" and I will
take profits if it is above the 50cts region. 

Source: Civmec Limited IPO Prospectus, IPO Fact Sheet
by UOB

Bumitama Agri Limited

To download a copy of the prospectus,
please do it here.

Bumitama Agri Limited

Offer Price: $0.745
Offer Size: 273.334m new shares + 24.236m vendor shares
Public Tranche – 15.0m shares
Placement Tranche – 157.737m shares
Cornerstone Tranche – 124.833m shares
NAV per share (post-IPO): Rp2,342 (Equivalent to S$0.328)
Historical PE: 15.0x (FY11)
Market Cap (post-IPO): S$1.309b
Open: 4 April 12
Close: 10 April 12
Listing: 12 April 12, 9.00am

Bumitama Agri Limited will join the current already-listed
palm-oil related peer like Wilmar, Golden Agri, Indo Agri,
First Resources, Mehwah, Kencana Agri and Global Palm
in SGX this coming Thursday. The company is a pure
upstream oil palm plantation player with operations in
Indonesia, mainly Central Kalimantan, West Kalimantan
and Riau. The company has a total landbank of 191,948ha,
comprising 119,162ha (62%) of planted area and 72,786ha (38%)
of uncultivated land available for new planting. Bumitama
has a young age profile of 5 years for its planted area, and
only 28% of its total planted area is at the prime age.
Currently, it owns and operates five crude palm oil (CPO)
mills in Kalimantan and one in Riau, with a total fruitfresh
bunch (FFB) processing capacity of 2.07m tonnes every year.

The company will raise about S$195.2 million from the listing
of shares and they will use the net proceeds as followed:

(a) approximately S$142.0 million will be committed for capital
expenditure for the expansion and development of our existing
uncultivated land bank and oil palm plantations;
(b) approximately S$12.6 million to repay the Shareholder Loans,
where the majority of the loans were used to increase and
consolidate our shareholding in our subsidiary, BGA, as part of
the Restructuring Exercise;
(c) approximately S$27.9 million to finance our share of the capital
expenditure of subsidiaries under SNA and BAS for cultivation;
and
(d) the balance of approximately S$12.7 million for our working
capital needs.

It is worthy to note that Oakridge, a subsidiary of Malaysia-listed
IOI will hold 30.4% of Bumitama and Asdew Acquisitions Pte Ltd,
Hwang Investment Management Berhad, Target Asset Management
Pte Ltd, UOB Asset Management Ltd, Value Partners Hong Kong
Limited and Wii Pte Ltd (a wholly owned subsidiary of Wilmar
International Limited) will be the cornerstone investor.

At 74.5cts, Bumitama will be listed at a PE of 15.2x for FY 2011
and Price/Book of 3.7 times and gearing of 0.8 times, this is rather
high valuation. Most of its peers are trading at lower valuation
now and I don't see a favourable trading condition for the company
pass the honeymoon period. Just to give an example of what
happened to its last 2 peers listed, Global Palm, a much smaller
producers listed at 46cts and it never see this price again after
listing and is now hovering around half of its IPO price around 23cts.
Mewah listed at $1 and is also trading around 50% of the IPO
around 51.5cts I am not saying that Bumitama will definitely perform
as there are other peers like First Resources and Indo Agri who are
soaring high. I am just saying that Bumitama is listing at a notably
higher and valuation. 

I feel that the stock is priced at a rich valuation but since this
is only the 2nd IPO this year and looking at Cordlife's debut,
we can expect the same reception for the stock as well.
At this price, I will take profits within the first few days of
trading and will not hold on to it for long until I see "value"
in the company again. 
My personal recommendation is to Subscribe for the public
offering with a profit potential of 20-25% from the share.
With 15 million shares for public offering, the chances of getting
the stock is significantly higher and it is worth the punt on the stock.

Source: Bumitama Agri IPO Prospectus, IPO Fact Sheet
by UOB, Straits Times.