Heavy demand for Fontana shares

Fontana shares are now listed on the Junior Market of the Jamaica Stock Exchange with bids now in to purchase 7.7 million shares up $2.50 prior to the opening of trading. There is just one offer at $4 to sell 4,500 shares.
The heavy demand in in keeping with heavy over subscription the IPO received. A number of investors in the stock are not pleased that the company varied the terms of the allocation of shares to persons in the general pool from the stated treatments included in the prospectus that stated that multiple applications would be merged and treated as one.
The share issue attracted 2,770 applicants for shares in the company. The order book on the buy side is shown in the accompanying chart with orders at 10 am.
The PE based on last year’s earnings is a low 8, suggesting that a price in the mid $4 region or higher is likely, once it can trade at those levels. Subsequent to the time the attached chart was created, the highest bid is now at $2.60 to buy 130,000 units with total bids in the syetem to purchase 17.7 million shares. One more offer at $3.77 to sell 30,610 units was posted after trading commenced. The maximum price the stock can trade at today is $2.44, 30 percent above the IPO price of $1.88.

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