In the News: 2005

SAT Sets Bt12.90 Share Price for IPO

The Nation
19 January 2005

Somboon Advance Technology (SAT) has priced its 74 million initial public offering (IPO) shares at Bt12.90 each.

The subscription period has been slated for January 20-21.

SAT president Verayut Kitaphanich expressed confidence that the stock would successfully remain above the offering price on its January 31 debut, because of its price-to-equity ratio of eight times - well below the current SET index of 10 times.

He said news of the IPO had received an overwhelming response from both local and international institutional investors.

Of the total shares, 30 million are earmarked for institutional investors. The firm's registered capital will increase to Bt300 million from the share sale.

The company will mobilise Bt954.6 million from the share allotment to increase production capacity for drive shafts and other products, as well as to repay its debts. Trinity Securities is the lead underwriter for SAT's share allocation, while another eight brokers are involved as underwriters.

He said the company would grow by 15-17 per cent this year, a higher rate than for the industry as a whole.

Kanitha Subpa-asa, president of Trinity Advisory 2001 - SAT's financial adviser for the pending IPO - said the company's business potential was attractive to investors.

She said that Thailand is the world's second-largest pickup manufacturing base, and SAT dominates the drive-shaft market here for pickups.

The government's policy of promoting Thailand as the Detroit of Asia and continued relocation of pickup manufacturers to the Kingdom have been a boon to SAT, said Kanitha.

In the first nine months of 2004, SAT recorded sales of Bt2.36 billion and a net profit of Bt641 million.

The Thailand Equity Fund earlier bought 13.3 per cent of SAT, an indication of the company's fundamental, soundness.