Kerry Express (KEX), Thailand's first delivery company to be listed on the SET, is expected to raise capital of 8.4 billion baht from offering 300 shares at an IPO price of 28 baht, which are scheduled to be traded on Christmas Eve.
Proceeds from the IPO are allotted to fund business expansion and paying off debts, said Prasert Tantayawit, managing director for investment banking at Maybank Kim Eng Securities Thailand.
KEX will likely make the SET 50 by mid-2021, said Veena Lertnimitr, executive vice-president for investment banking function at SCB Securities.
The IPO market capitalisation is at 48.72 billion baht for total paid-up capital of 1.74 billion shares at an IPO price of 28 baht.
"The market cap for the last SET 50 stocks is just 50 billion baht but KEX stocks' high growth may drive its market cap to 100 billion baht in the future," said Ms Veena.
The company plans to utilise 8.4 billion baht in IPO funding for business expansion, debt repayment and working capital reserves.
Chief operating officer Warawut Natpradith said KEX plans to expand its delivery network to enhance its logistics capacities, grow the customer-to-customer (C2C) base, invest in IT data storage and restoration systems to prepare for more competition and potential newcomers.
Expanding new business via business partners and strategic shareholders is also a strategy for future competition, as well as strategic investment via both horizontal and vertical acquisition opportunities.
Mr Prasert said vertical expansions include service expansions related to the delivery process such as delivery vehicles while horizontal expansions include development of new products and services to generate additional income.
The company has more than 15,000 service centres nationwide including 2,000 of its own, 3,000 for large partners and 10,000 for small and medium-sized branches.
The company was able to deliver up to 1.9 million parcels a day thanks to its commitment to next day delivery, with cash-on delivery worth 6.5 billion baht a month.
For the first three quarters, the company reported total revenue worth 14.7 billion baht, a 0.2% increase against the same period in 2019 and net profit worth 1.03 billion baht, a gain of 14.4%. Mr Prasert said the revenue from C2C contributed 53.9%, with business-to-customers making up 44.3%, business-to-business at 1.7% and advertisements at 0.1%.
Institutional investors oversubscribed by 24 times from the period of book building last week. Cornerstone investors overbooked by 10 times.