Ananda Development announces its IPO price

Ananda Development announces its IPO price

Ananda Development has set its initial public offering price at 4.20 baht per 10-satang-par-value share in a bid to raise 5.6 billion baht.

The company plans to sell 1.33 billion shares in its IPO.

Company president Chanond Ruangkritya said 3 billion baht of the proceeds will be used to refinance a leveraged buyout loan from Krung Thai Bank, 2 billion will be used for business expansion and the rest as working capital.

The company hopes its debt-to-equity ratio will decrease to 0.9 times after the refinancing.

Ananda's goal is to be a growth stock, which means its return will come mainly from capital gains, while dividends are not its strength, said Mr Chanond.

For the first nine months of this year, the company achieved revenue of 3.79 billion baht for a net loss of 314 million.

In 2011, full-year revenue was 5.69 billion baht for a net loss of 317 million due to amortisation costs.

As of Sept 30, the company had negative shareholder equity of 445 million baht due to a purchase price allocation (PPA).

Excluding the PPA, the company's earnings before interest, tax, depreciation and amortisation was 483 million baht for the first nine months of this year for a net profit of 40 million.

Ananda plans to spend 10-15 billion baht to start five or six new projects each year over the next three years for growth of 20-30%.

At present, the company has retained losses of 220 million baht but expects to return to the black next year, as presale bookings worth 13.5 billion baht will be realised in the next two years.

"Foreign investors don't really care about dividends. They look more for high growth potential," said Mr Chanond.

He remains confident in the company's strength, which is high-rise condominiums.

He added that foreign investors have only two other real choices _ L.P.N Development and Asian Property.

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