Bangkok--4 Jun--124 Communications
Jay Mart, Thailand’s leading mobile phone distributor and dealer, is set to ring the bell at its first day trading on June 25th with IPO price range between 1.60 — 1.80 Baht per share. Subscription of the new shares will be on June 17 -18, 2009
Mr. Adisak Sukhumvitaya, Chief Executive Officer of Jay Mart Public Company Limited, discloses that JMART is to sell its 75 millions new shares, at par value of 1 Baht per share through Initial Public Offering. 60 million new shares will be offered to retails and institutional investors, while the remaining 15 million new shares will be allocated for valued business partners, directors and employees.
Money raised from IPO will be used to expand its business as well as to pay off the short-term loan. Therefore, the D/E ratio of current 1.17 is expected to reduce to roughly as low as 0.7. Asia Plus Securities Plc. is a financial advisor and a lead underwriter for Jay Mart IPO.
JMART operates three services. Mobile phone business and accessories is the key business area of Jay Mart, accounting for 95% of earnings, while the rest is generated from retail management and debt collection under its subsidiary JMT Network Services.
Being one of the leader —if not the leader- in Thailand’s mobile phone distributing business, JMART earned 33% of the revenue from selling mobile phones and accessories through wholesales while the rest of 67% came from reselling via its 199 retail outlets located in leading department stores nationwide.
For the retail management, Jay Mart operates and manages 26 IT Junctions selling mobile phones nationwide in which 24 of them are located in Big C Superstore. IT Junctions contributes to JMART business because they not only serve as local distribution channels to JMART dealers, but they also yield space rental fee, accounting for 2% of total JMART’s earnings. The company has a plan to expand the number of IT Junctions to 35 by next year. Additionally, JMART also operates a stand-alone retail space so-called J-Venue. This kind of stand-along retail is targeted to be at such crowded communities as an industrial estate. The first and successful J-Venue is located at Navanakorn Industrial Park. It has plan to expand additional 3 outlets within the next two years.
The third and very promising business under the umbrella of JMART is JMT Network Services, a professional debt collection management, which accounts for 3% the total earnings. As of the end of the first quarter, total value of debt collection services is as high as 10,264 million Baht. Jay Mart has recently purchased a None Performing Asset (NPA) with a total value of 2,800 million baht for only 127 million Baht; the company plans to increase its NPA purchase to 240 millions in the next two years.
Having been the leader in all areas the company stepped in, JMART plans an aggressive expansion during these two years targeting to increase the market share of inter brands mobile phones and accessories from 11% to 18% and to have its own brand under ‘JFone’ name. This will result in complete segment in mobile phone business with higher profitability. Furthermore, the targeted number of 35 IT Junction will strengthen the ability to well market and distribute its products. Targeting to purchase additional of 115-million-baht NPA, the gross margin will definitely be increased since the margin in such business can be as high as 30-40%.
Ms. Pornpimol Dumrongsiri, Executive Vice President, Asia Plus Securities Public Company Limited, comments that Jay Mart has strengths in both horizontal and vertical integration strategy, which offer variety of its nationwide network, and its own “J-Fone” house brand will enhance the company’s sales and bottom line, making it a promising company to invest in. Asia Plus thus sets JMART’S IPO subscription during June 17 -18, and expects its first-day trade on June 25, 2009.
The range of IPO price is primarily set at 1.60-1.80 baht per share, calculating from its last year’s net profit in which EPS (fully diluted) at 0.32 baht, P/E ratio will be approximately 4.9-5.6, which is very attractive.
Jay Mart has a registered capital of Baht 300 million, with 300 million shares at 1-baht par value. Its paid-up registered capital is of Baht 225 million, consist of 225 common stock
In 2008, the company’s total revenue was Baht 5.500 million with a net profit of Baht 98 million. This year first quarter, the company earned its revenue of Baht 1,200 billion with a net profit of Baht 20 million.
For further information, please contact: Duchanee Nualkeiw
Eakkapop Panthurat
Niracha Ruenroeng
124Communications PCL.
Tel: 02-662-2266, www.124comm.com