CK Power (CKP) has offered a discount of 26% for its 220 million initial public offering shares at 13 baht each, which is almost at the bottom of the price range set at 12-15 baht.
Supamas: Aiming to strike a balance
The par value is at 5 baht each, with price per book of 1.2 times, said managing director Supamas Trivisvavet.
Of the 220 million shares, 180 million are newly issued and 40 million are being offered by shareholders Bangkok Expressway, Bang Pa-in Cogeneration and Thai Tap Water.
The shares will be allocated to CKP's trade partners (40%), institutional investors (20%) and retail investors (40%).
"We expect to mobilise a total of 2.86 billion baht from the IPO, of which about 1.3 billion baht will pay debt," Ms Supamas said.
This amount is slightly lower than its previous expectation of 3 billion baht as cautious sentiment has led the company to set a discount.
The discounted price is required to cushion liquidity and timing risks.
"We are aiming to balance two sides _ the capital we need and investors' profit," said Ms Supamas.
Even though the company will earn less than projected, it sees no effect as it is able to finance the project with a bank loan. Its debt-to-equity ratio is about 0.2 times, with about 1 billion debt.
Kongkiat Opaswongkarn, chief executive of Asia Plus Securities, the company's underwriter, said CKP is investing in six power plants in Thailand and overseas.
It is also conducting a feasibility study for eight cogeneration projects in central and northeastern Thailand as well as two hydropower plants in Laos.
Additionally, the firm is seeking opportunities in Myanmar.
"We aim to be a leading energy company, especially in renewables," said Ms Supamas.