Thai Nguan to press ahead with IPO despite gloom
Thai Nguan Metal is pressing ahead with its plan to list on the stock market in the first quarter, despite weakening market sentiment.
It hopes to raise Bt100 million from an initial public offering (IPO), according to its financial adviser BFIT Securities. An executive at BFIT said the IPO should get a warm welcome if it is suitably priced and its subscription period and trading debut well-timed. "If the IPO price and timing are right, it should be successful. I believe that the company's earnings will also be a plus in attracting investors," he said. Thai Nguan executives will meet with the advisers at the end of this week to decide on the subscription period as well as the date for the trading debut. BFIT will then produce a valuation report and set the IPO price. It will also announce the IPO's arrangers and underwriters. All these steps can be achieved before the end of this quarter, the BFIT executive said. Thai Nguan Metal is a distributor of raw materials and ornamental metals. It has registered capital of Bt400 million - 400 million shares with a par value of Bt1 - and paid-up capital of Bt300 million. The company earlier reported in a filing to stock exchange that the par value of the 100 million IPO shares would be Bt1. Funds from the IPO will be used to build a new factory, and purchase machinery and equipment. Some will be set aside as working capital. The BFIT executive noted that investors continue to fret about deteriorating market sentiment, in particular the ongoing fallout from the Bank of Thailand's controversial imposition of a 30 per cent withholding measure on capital inflows. Still, he was confident that the negative sentiment would not be a factor in the IPO price, saying investors had already factored it into the market. He said the market would rebound when the capital controls were lifted. Multibax, the first new company to be traded on the stock exchange this year, did not receive a warm welcome or its debut. Its share price closed below the IPO price. Still, the BFIT executive was confident Thai Nguan would not see the same fate. Meanwhile, Finance Minister MR Pridiyathorn Devakula said yesterday that a tax incentive package for newly listed companies would be submitted to the Cabinet today.
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