Sawad seeks B1.73bn from IPO

Sawad seeks B1.73bn from IPO

Srisawad Power 1979 (Sawad), a car title lender, will raise 1.73 billion baht in fresh funds from earmarking 250 million shares to the public to capitalise on the sizzling initial public offering (IPO) market.

Thida: 1,000 branches in next three years

The company priced its IPO shares at 6.90 baht each, translating to 11.9 times for a price-to-equity (PE) ratio or a 23.7% discount to the financial sector’s PE.

Upon completing the share offering, its registered capital will be increased to 1 billion baht from 750 million at present.

Of the total IPO shares, 40% will be sold to institutional investors and the rest to retail investors.

The subscription date is set from April 28-30. Its stock is set to debut on the Stock Exchange of Thailand (SET) on May 8.

Proceeds from the share allocation will be used to expand its lending portfolio and repay debts.

Asia Plus Securities is financial adviser and lead underwriter for the IPO. KT Zmico Securities, Kasikorn Securities, CIMB Securities and Finansia Syrus Securities are co-underwriters.

A recent series of successful IPOs and the rising stock market is likely to whet investors’ appetite.

All four new stocks on the SET gained on the opening day above their IPO prices.

Thida Kaewbootta, a director, said Sawad targets 30% lending growth to 8 billion baht this year from 5.7 billion baht last year.

“The company’s lending portfolio is expected to grow to 10 billion baht in the next five years, underpinned by branch expansion,” said Ms Thida.

The company plans to spend 30 million baht this year on 100 new branches bringing the total to 702 branches nationwide, eyeing 1,000 in the next three years.

Ms Thida said the company will expand branches in conveniences stores to tap the fast-growing business trend in the future.

Managing director Duangchai Kaewbootta said Sawad’s car title loans have high growth potential amid the gloomy economy, as they are an alternative source of funding for those in dire need of money.

The company’s revenue amounted to 1.94 billion baht and net profit 575 million last year. Its net profit margin stood at 30%, while non-performing loans were 3.7% of loans outstanding.

In 2013 it had total assets of 6.05 billion baht. Return on assets was 11%, while return on equity stayed at 66%.

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