Dragon One stock decision next week
The board of governors of the Stock Exchange of Thailand (SET) will make a final decision on approving the relocation of Dragon One shares from the main bourse to the Market for Alternative Investment (MAI) next week.
"It makes no difference where the company's stock trades. However, I think it would be of benefit if it traded on the MAI because it would become one of the top five market-cap stocks and this would catch investors' eyes," said Dragon One chief executive Jrarat Pingclasai. Dragon One took over Diana Department Store through a backdoor listing, but the SET is requiring it to reapply for listing after it sold all of Diana Department Store's assets and turned itself into a holding firm, with Application Hosting Services as its main source of income. The SET initially said Dragon One itself was not qualified for listing on the main bourse because it had no profit track record. If the company wants to maintain its listing status, it must reapply under the name of subsidiary Application Hosting Services, which does have a profit track record. However, Application Hosting Services, which has registered capital of Bt78 million - well below the minimum Bt200 million in registered capital required by the SET - must trade on the MAI instead. Jrarat said the SET would allow the company to start trading on the MAI next month. He said the company would benefit in terms of corporate income tax because it would pay a rate of 20 per cent trading on the MAI, compared with the 30 per cent of its annual net profit it pays at present. Moreover, MAI president Chanitr Charnchainarong will invite the company to participate in a road show to be held soon abroad, he said. He said investors should consider earnings from the company's financial statement, not from the consolidated financial statement, because the company's financial statement had to book losses from Diana Department Store. Dragon One's consolidated financial statement for this year's first quarter recorded a net loss of Bt22 million, compared with a net profit of Bt1.14 million in the same period last year. However, its financial statement recorded a first-quarter net profit of Bt1.08 million. Jrarat has repeatedly said the company will announce the takeover of three or four companies late in the second quarter. The deals are under negotiation, but the company has slowed down the process because it does not want any changes during the filing of applications.
|
