Advice IT Infinite, an IT retailer and wholesaler, will launch its initial public offering (IPO) on the Stock Exchange of Thailand, with the first day of trading scheduled for Jan 31, according to the company's chief executive Nath Natnithikarat.
The company's IPO will consist of the sale of up to 170 million shares, representing 27.4% of its total paid-up capital, priced at 3.24 baht per share. It will open for subscription between Jan 22-24, 2024. The company has appointed Asia Plus Securities as lead underwriter.
The company will use the funds raised, estimated at around 500 million baht, to expand its business, including the rollout of additional branches and the renovation of existing branches. An amount would also be used to repay loans to financial institutions and upgrade the company's IT system.
Mr Nath owns a 37% stake in the company at present, Thai Joint Venture Group holds 35%, Amorn Tathong holds 15.8%, while individual investors hold a combined 11.7%. After the IPO, Mr Nath's shareholding would be diluted to 26.8%, Mr Amorn's to 11.5%, Thai Joint Venture Group's to 25.8%, while the share own by other individuals would be diluted to 8.5%, the company revealed.
"After the IPO's postponement over the past few years, we think this is the right timing for the IPO and we're the first company to list on the SET this year," Mr Nath noted.
The company was established over two decades ago, initially with 150 million baht in capital. The company's revenue reached 10.3 billion baht as of the first nine months of 2023.
The company will use the 500 million baht in funds from the IPO to expand its branch network. The company has 338 outlets at present, 110 of which are operated by the company, while 228 of them are franchises. The goal is to have 390 branches by 2026, of which 130 would be operated by the company.
"We are among the top four IT retailers in Thailand by revenue. When accounting only for IT products, excluding smartphones, we are the leader, hence there is still room for growth in the smartphone market," Mr Nath said.
With the new source of funds, Advice will focus more on the smartphone market, particularly Apple devices. Advice is expected to be appointed as an Apple authorised reseller and it will open an iStudio by Advice shop by the first quarter of 2024.
"We aim for smartphones to account for 30% of total revenue within three years, up from 5% in 2023 and an anticipated 10% in 2024," Mr Nath added.
Mr Nath acknowledged that the IT and smartphone markets have continued to face challenges amid the current unfavourable economic conditions and intense competition. However, Advice still sees opportunities when it comes to the replacement of smartphones in the country.
"Advice will create differences from other players and aims to have Apple products in 75 Advice outlets by the end of this year."
In the second half of 2024, the IT market is expected to see the launch of more AI-enabled PCs that will spur demand for replacement and the use of specific device designs.
Moreover, Advice aims to increase service revenue from its repair centre. It has set up a dedicated team to target demand for IT devices in the corporate market. It aims to increase revenue from the corporate market from 5.4% last year to 10% in 2026.
He added that Advice's strength in efficient inventory management makes it a lean operation, and the company also offers competitive prices to users while maintaining its profitability, even in this highly competitive situation. This minimises risk from exchange rates, too, Mr Nath said.
Advice aims to grow its revenue by 10% this year, which is above the industry's average level of growth. The firm posted revenue of 14.3 billion baht in 2022.
