Expo Lanka Holding Limited - IPO
Sri Lanka's stock exchange has approved an initial public offering by Expolanka Holdings to raise 2.4 billion rupees by issuing 172 million ordinary voting shares at 14 rupees each.
The IPO opens May 12 with the prospectus was available on April 25.
The company has said it plans a sell-down of a 25 percent stake including a recent private placement to raise funds for expansion and repay debt.
The company announced after its recent private placement that three independent directors had been appointed to its board.
post by Sinhala Ayojakaya,
Expo Lanka Holding Limited, another IPO.As usual our retails investors are very busy to find cash to apply for said ipo.Some time they sell their good stocks to find cash. Who cares prospectus? Why? Every IPO share price is going up in first day. So no need to read prospectus and best thing is applying all IPOs. Do you think same? We think that most of our retail investors think so. Companies, those come to IPOs, they know how our investors think and they value their IPO price with smart premium and rest will be handed over to our investors. They are doing job well. Finally IPO is oversubscribed by many times.
If above comments is not relevant to you, please forget it.
Here we would like to highlight few points regarding Expo Lanka Holding Limited.
· Stated capital of the company Rs.1,782,915,000/=.its equal to issued no of shares (before IPO).This means promoters cost of shares is Rs.1.if directors sell 127,351,071 shares @14,their cost for the company is zero. They can do this without changing major shareholding.
· 15%, out of IPO shares will be allocated to employees, its means 25,800,000 no of shares. In addition to this another 2,678,500 shares will be allocated on May 2011 under ESOP. some time they may dump their holding in first day,if they feel,price is getting down and they know their company real value.
· 316,667,500 shares were transferred @ rs.6.we can’t say exactly their decision on first trading day. but we know if they sell @14,they will get a wonderful capital gain (14-6).
· ROE of the company is 15%, EPS .711 for nine months ended including major one off income, Book value per shares 2.41 after IPO increased to 3.42.pls make your valuation.
· Company has declared dividend for the nine months ended 31st December 2011,cents 0.121.this reduced further cost of a share of directors
· During the year Rs.100,626,192 has been granted to directors as advance.
Note. If you think that above comments are wrong, please discuss with Sinhala Ayojakaya.
