Monday, April 9, 2012

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

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